UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,  D. C. 20549
FORM 10-Q
Mark One

      /X/  QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
           SECURITIES AND EXCHANGE ACT OF 1934
                For the quarter period ended September 30, 1999

      //   TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF
           THE EXCHANGE ACT
               For the transition period from _______ to _______
                       Commission File Number: 33-81890
                          Community Bankshares, Inc.
                      __________________________________
            (Exact name of registrant as specified in its charter)

                Georgia                                58-1415887
   (State or other jurisdiction of                   (IRS Employee
    incorporation or organization)               identification number)

                            448 North Main Street,
                            Cornelia, Georgia 30531
                   (Address of principal executive offices)
                                  (Zip Code)
                                (706) 778-2265
             (Registrant's telephone number, including area code)

                                      N/A
                (Former name, former address and former fiscal
                      year, if changed since last report)

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

                     APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of
September 1, 1999:  2,172,830
<PAGE>


                          COMMUNITY BANKSHARES, INC.
                               AND SUBSIDIARIES
                                     INDEX

                                     Page No.
PART I.   FINANCIAL INFORMATION

Item 1.    Financial Statements

      Consolidated Balance Sheet -
      September 30, 1999 and December 31, 1998         2

      Consolidated Statements of Operations
      and Comprehensive Income for Three
      Months Ended September 30, 1999 and 1998
      and Nine Months Ended September 30, 1999
      and 1998                                         3

      Consolidated Statements of Cash Flows -
      Nine Months Ended September 30, 1999 and 1998    4

      Notes to Consolidated Financial Statements       5

Item 2.    Management's Discussion and Analysis of
      Financial Condition and Results of Operations    6

PART II.   OTHER INFORMATION

Item 4.    Submission of Matters to a Vote of
             Security Holders                          7

Item 6.    Exhibits and Reports on Form 8 - K          7

      Signatures                                       8
<PAGE>

                       PART I - FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS

<TABLE>
<CAPTION>

                          COMMUNITY BANKSHARES, INC.
                               AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                   SEPTEMBER 30, 1999 AND DECEMBER 31, 1998
                            (Dollars in thousands)
                                  (Unaudited)

                      Assets                           1999        1998
                                                   ----------  ----------
<S>                                               <C>         <C>
Cash and due from banks                            $  31,545   $  26,796
Interest-bearing deposits in banks                       374         428
Federal funds sold                                    12,355      22,890
Securities available-for-sale                         48,263      42,525
Securities held-to-maturity (fair value
     $30,897 and $32,174)                             30,767      30,915
Loans held for sale                                      627         699

Loans                                                361,874     313,438
Less allowance for loan losses                         5,366       4,863
                                                   ----------  ----------
          Loans, net                                 356,508     308,575
                                                   ----------  ----------

Premises and equipment                                13,664      13,463
Other assets                                          15,513      14,302
                                                   ----------  ----------

          Total assets                             $ 509,616   $ 460,593
                                                   ----------  ----------

       Liabilities and Stockholders' Equity

Deposits
    Noninterest-bearing demand                     $  70,669   $  65,266
    Interest-bearing demand                           99,787      94,458
    Savings                                           22,292      19,731
    Time, $100,000 and over                           78,755      67,003
    Other time                                       170,505     158,824
                                                   ----------  ----------
          Total deposits                             442,008     405,282
Federal Home Loan Bank advances                       15,000       5,000
Other borrowings                                       1,094         808
Other liabilities                                      7,644       8,958
                                                   ----------  ----------
          Total liabilities                          465,746     420,048
                                                   ----------  ----------

Commitments and contingent liabilities

Redeemable common stock held by ESOP, 380,722
     and 363,616 shares outstanding, at fair value    14,924      14,254
                                                     --------    --------

Stockholders' equity
    Common stock, par value $1; 5,000,000
        Shares authorized; 2,172,830
        Shares issued and outstanding                  2,173       2,170
    Capital surplus                                    6,063       6,036
    Retained earnings                                 21,265      17,858
    Accumulated other comprehensive income,
         Net of tax                                     (555)        227
                                                   ----------  ----------
          Total stockholders' equity                  28,946      26,291
                                                   ----------  ----------

 Total liabilities and stockholders' equity        $ 509,616   $ 460,593
                                                   ----------  ----------
<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>
<PAGE>


<TABLE>
<CAPTION>
                          COMMUNITY BANKSHARES, INC.
                               AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                            AND COMPREHESIVE INCOME
              THREE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998 AND
                 NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
               (Dollars in thousands, except per share amounts)
                                  (Unaudited)

                                      Three Months        Nine Months
                                         Ended               Ended
                                     September 30,       September 30,
                                     1999     1998        1999     1998
                                   -----------------  --------- --------
<S>                                <C>      <C>        <C>     <C>
Interest income
    Loans                          $ 8,895  $ 7,785    $ 25,674 $ 21,818
    Taxable securities                 591      631       1,747    2,041
    Nontaxable securities              500      448       1,478    1,256
    Deposits in banks                    3       14          14       32
    Federal funds sold                 244       98         681      317
                                   -------- --------  --------- --------
          Total interest income     10,233    8,976      29,594   25,464
                                   -------- --------  --------- --------

Interest expense on deposits
    Deposits                         4,341    4,101      12,654   11,704
    Other borrowings                   158       15         319       32
                                   -------- --------  --------- --------
          Total interest expense     4,499    4,116      12,973   11,736
                                   -------- --------  --------- --------

          Net interest income        5,734    4,860      16,621   13,728
Provision for loan losses              370      224       1,027      764
                                   -------- --------  --------- --------
          Net interest income
          after provision for
          loan losses                5,364    4,636      15,594   12,964
                                   -------- --------  --------- --------

Other income
    Service charges on
       Deposit accounts                744      643      2,105    1,859
    Other service charges and fees     202      130        466      386
    Gains on sale of loans              83      157        239      372
    Trust Department fees               21       29         89       83
    Net realized gains on
       sales of securities               -       30          -       41
    Nonbank subsidiary
        non-interest income          1,584    3,536      4,583    7,175
    Other operating income             193      131        572      376
                                   -------- -------   --------  --------
          Total other income         2,827    4,656      8,054   10,292
                                   -------- --------  --------- --------

Other expenses
    Salaries and employee benefits   2,978    2,662      9,177    7,562
    Occupancy expense                  364      355      1,033      969
    Equipment expense                  697      492      1,958    1,396
    Other operating expenses         1,780    1,684      5,336    4,753
                                   -------- --------  --------  -------
          Total other expenses       5,819    5,193     17,504   14,680
                                   -------- --------  --------  -------

          Income before income       2,372    4,099      6,144    8,576
taxes

Income tax expense                     765    1,399      1,809    2,838
                                   -------- --------  --------  -------

          Net income               $ 1,607  $ 2,700   $  4,335  $ 5,738
                                   -------- --------  --------  -------

Other comprehensive income (loss):
   Unrealized gains (losses) on
   Securities available-for-sale
   arising during the period            99      209      (782)      191
   Less:  reclassification
adjustment for
gains included in net
income                                   -       18          -       25
                                   -------- --------  --------- --------
     Total other comprehensive
           Income                       99      227       (782)     216
                                   -------- --------  --------- --------

          Comprehensive income     $ 1,706  $ 2,927   $  3,553  $ 5,954
                                   ======== ========  ========= ========

Basic earnings per common share    $  0.74  $  1.24   $   2.00  $  2.64
                                   -------- --------  --------- --------
Diluted earnings per common share     0.73     1.23       1.97     2.61
                                   -------- --------  --------  --------
Cash dividends per share of
common stock                       $ 0.039  $ 0.037   $  0.118  $ 0.110
                                   -------- --------  --------- --------
<FN>
See Notes to Consolidated
Financial Statements.
</FN>
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
                          COMMUNITY BANKSHARES, INC.
                               AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
             FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
                            (Dollars in thousands)
                                  (Unaudited)

                                                       1999        1998
                                                    --------    --------
<S>                                              <C>         <C>
OPERATING ACTIVITIES
    Net income                                    $   4,335   $   5,738
    Adjustments to reconcile net income to
        net cash provided by operating
        activities:
        Depreciation and amortization                 1,758       1,441
        Provision for loan losses                     1,027         764
        Provision for other real estate                   -          10
        Deferred income taxes                          (259)       (221)
        Increase (decrease) in loans held for
           sale                                          72        (394)
        Net realized (gains) losses on
           securities                                     -         (41)
          Available-for-sale
        Net (gains) losses on sale of other real
           estate                                       (56)         (3)
        (Increase) decrease in interest
           receivable                                   298        (740)
        Increase (decrease) in interest payable        (545)        651
        Increase in taxes payable                       345       1,112
        Increase (decrease) in accounts
           receivable of nonbank subsidiary            (181)     (1,136)
        Increase (decrease) in work in
           process of nonbank subsidiary                219        (804)
        Increase (decrease) in accruals and
           payables of nonbank subsidiary            (1,253)        270
        Other operating activities                     (666)     (1,164)
                                                  ----------  ----------

              Net cash provided by
                 Operating activities                 5,094       5,483
                                                  ----------  ----------

INVESTING ACTIVITIES
    Purchases of securities available-for-sale      (17,771)    (12,936)
    Proceeds from sales of securities
      available-for-sale                                  -       6,161
    Proceeds from maturities of securities
      available-for-sale                             10,731      16,378
    Purchases of securities held-to-maturity           (448)     (2,329)
    Proceeds from maturities of securities
      held-to-maturity                                  596         830
    Net decrease in Federal funds sold               10,535      (1,150)
    Net increase in interest-bearing
     deposits in banks                                   54        (177)
    Net increase in loans                           (49,703)    (56,017)
    Purchase of premises and equipment               (1,729)     (2,862)
    Net cash acquired in branch acquisition               -         171
    Proceeds from sales of other real estate            607          70
                                                  ----------  ----------

              Net cash used in
                Investing activities                (47,128)    (51,861)
                                                  ----------  ----------

FINANCING ACTIVITIES
    Net increase in deposits                         36,725      42,839
    Increase in FHLB advances                        10,000       5,000
    Increase in other borrowings                        400           -
    Repayment of other borrowings                      (114)       (115)
    Proceeds from issuance of Common
      Stock                                              30           -
    Dividends paid                                     (258)       (239)
                                                  ----------  ----------
              Net cash provided by
                financing activities                 46,783      47,485
Net increase (decrease) in cash and
   due from banks                                 $   4,749   $   1,107

Cash and due from banks at beginning of the          26,796      23,957
Period
                                                  ----------  ----------

Cash and due from banks at end of the Period      $  31,545   $  25,064
                                                  ----------  ----------

SUPPLEMENTAL DISCLOSURES
    Cash paid for:
        Interest                                  $  13,518   $  11,085

        Income taxes                              $   1,729   $   1,947

NONCASH TRANSACTIONS
    Unrealized (gains) losses on
      securities available-for sale               $   1,302   $    (318)

    Principal balances on loans and premises
      and equipment transferred to other
      real estate                                 $     743   $     127

BRANCH ACQUISITION
    Net cash acquired                             $       -   $     171
                                                  ----------    --------

    Loans                                         $       -       2,981
    Premises and equipment                                -          10
    Other assets                                          -          14
    Core deposit intangible                               -         759
    Deposits                                              -      (5,838)
    Other liabilities                                     -         (25)
                                                  ----------    --------

         Net liabilities assumed, net of                  -
           cash and due from banks of $171        $           $  (2,099)
                                                  ----------    --------

 <FN>
 See Notes to Consolidated Financial Statements
 </FN>
 </TABLE>
 <PAGE>


                           COMMUNITY BANKSHARES, INC.
                                AND SUBSIDIARIES

                   NOTE TO CONSOLIDATED FINANCIAL STATEMENTS

 NOTE 1.   BASIS OF PRESENTATION

 The consolidated financial information included herein is unaudited; however,
 such information reflects all adjustments (consisting solely of normal
 recurring adjustments) which are, in opinion of management, necessary for a
 fair statement of results for the interim periods.

 The results of operations for the nine month period ending September 30, 1999
 are not necessarily indicative of the results to be expected for the full
 year.

 NOTE 2.   CURRENT ACCOUNTING DEVELOPMENTS

 In June 1998, the Financial Accounting Standards Board issued Statement of
 Financial Accounting Standards No. 133 ("SFAS No. 133"), "Accounting for
 Derivative Instruments and Hedging Activities".  This statement is required
 to be adopted for fiscal years beginning after June 15, 1999.  However, the
 statement permits early adoption as of the beginning of any fiscal quarter
 after its issuance.  The Company expects to adopt this statement effective
 January 1, 2000.  SFAS No. 133 requires the Company to recognize all
 derivatives as either assets or liabilities in the consolidated balance sheet
 at fair value.  For derivatives that are not designated as hedges, the gain
 or loss must be recognized in earnings in the period of change.  For
 derivatives that are designed as hedges, changes in the fair value of the
 hedged assets, liabilities, or firm commitments must be recognized in
 earnings or recognized in other comprehensive income until the hedged item is
 recognized in earnings, depending on the nature of the hedge.  The
 ineffective portion of a derivative's change in fair value must be recognized
 in earnings immediately.  Management has not yet determined what effect the
 adoption of SFAS No. 133 will have on the Company's earnings or financial
 position.

 NOTE 3    EARNINGS PER COMMON SHARE

 The following is a reconciliation of net income (the numerator) and
 weighted-average shares outstanding (the denominator) used in determining
 basic and diluted earnings per common share (EPS).
 <TABLE>
 <CAPTION>
                       Three Months Ended September 30, 1999
                 (Dollars in Thousands, except per share amounts)

                            Net      Weighted-Average
                           Income          Shares      Per Share
                        (Numerator)     (Denominator)    Amount
    <S>                   <C>             <C>         <C>
    Basic EPS               $ 1,607           2,172     $ 0.74
    Effect of Dilutive
    Securities                    0              27
         Stock options
                           --------        --------   --------
    Diluted EPS             $ 1,607           2,199     $ 0.73
                           ========        ========   ========
</TABLE>

<TABLE>
<CAPTION>

                      Three Months Ended September 30, 1998
                 (Dollars in Thousands, except per share amounts)

                            Net      Weighted-Average
                           Income          Shares      Per Share
                        (Numerator)     (Denominator)    Amount
    <S>                   <C>             <C>         <C>
    Basic EPS               $ 2,700           2,170     $ 1.24
    Effect of Dilutive
    Securities
         Stock options            0              26
                           --------        --------   --------
    Diluted EPS             $ 2,700           2,196     $ 1.23
                           ========        ========   ========
</TABLE>

<TABLE>
<CAPTION>

                         Nine Months Ended September 30, 1999
                 (Dollars in Thousands, except per share amounts)

                            Net      Weighted-Average
                           Income          Shares      Per Share
                        (Numerator)     (Denominator)    Amount
    <S>                   <C>             <C>         <C>
    Basic EPS               $ 4,335           2,172     $ 2.00
    Effect of Dilutive
    Securities                    0              27
         Stock options
                           --------        --------   --------
    Diluted EPS             $ 4,335           2,199     $ 1.97
                           ========        ========   ========
</TABLE>

<TABLE>
<CAPTION>

                         Nine Months Ended September 30, 1998
                 (Dollars in Thousands, except per share amounts)

                            Net      Weighted-Average
                           Income          Shares      Per Share
                        (Numerator)     (Denominator)    Amount
    <S>                   <C>             <C>         <C>
    Basic EPS               $ 4,648           2,033     $ 2.29
    Effect of Dilutive
    Securities
         Stock options            0              24
                           --------        --------   --------
    Diluted EPS             $ 4,648           2,057     $ 2.26
                           ========        ========   ========
 </TABLE>

 NOTE 4    SEGMENT INFORMATION

 Selected  segment  information  by  industry  segment  for the  periods  ended
 September 30, 1999 and 1998 is as follows:
<TABLE>
<CAPTION>

                                        Reportable Segments
                                       (Dollars in thousands)
                               ---------------------------------------
                                                      All
   For the three month period   Banking   Financial  Other    Total
   ended September 30, 1999               Super-
                                          markets
   ---------------------------- --------- --------- -------- ---------
  <S>                          <C>        <C>        <C>    <C>
   Revenue from external        $ 11,563     1,646       57  $ 13,266
   customers
   Intersegment revenues
   (expenses)                       (125)      162      395       432
   Segment profit (loss)           1,418       589     (347)    1,660
   Segment assets               $520,151    13,931    2,624  $536,706
</TABLE>

<TABLE>
<CAPTION>

                                        Reportable Segments
                                       (Dollars in thousands)
                               ---------------------------------------
                                                      All
   For the three month period   Banking   Financial  Other    Total
   ended September 30, 1998               Super-
                                          markets
   ---------------------------- --------- --------- -------- ---------
  <S>                           <C>         <C>       <C>    <C>
   Revenue from external
   customers                     $10,095     3,548       41   $13,684
   Intersegment revenues
    (expenses)                      (101)      134      365       398
   Segment profit (loss)         $ 1,219     1,671     (193)  $ 2,697
</TABLE>

<TABLE>
<CAPTION>
                                        Reportable Segments
                                       (Dollars in thousands)
                               ---------------------------------------
   For the nine month period    Banking   Financial   All      Total
   ended September 30, 1999               Super-     Other
                                          markets
   ---------------------------- --------- --------- --------  --------
  <S>                           <C>         <C>      <C>      <C>
   Revenue from external
   customers                     $33,392     4,708      142    $38,242
   Intersegment revenues
    (expenses)                      (368)      469    1,185      1,286
   Segment profit                $ 3,906     1,406     (878)   $ 4,434
</TABLE>

<TABLE>
<CAPTION>


                                        Reportable Segments
                                       (Dollars in thousands)
                               ---------------------------------------
   For the nine month period    Banking   Financial   All      Total
   ended September 30, 1998               Super-     Other
                                          markets
   ---------------------------- --------- --------- --------  --------
  <S>                           <C>         <C>      <C>     <C>
   Revenue from external
   customers                     $28,621     7,207       98   $35,962
   Intersegment revenues
    (expenses)                      (273)      359    1,094     1,180
   Segment profit                $ 3,315     2,963     (549)  $ 5,729
</TABLE>

<TABLE>
<CAPTION>


                                  For the three       For the nine
                                      months             months
                                 Ended September,   Ended September,
                                        30                 30
                                 -----------------  ------------------
                                   1999      1998      1999      1998
                                 --------  -------  --------   -------
   <S>                           <C>       <C>       <C>      <C>
   Net Income:
   Total profit for
    reportable segments          $ 2,007   $ 2,890    $5,312   $ 6,278
   Non-reportable segment loss      (347)     (193)     (878)     (549)
   Elimination of
    intersegment (gains) losses      (53)        3       (99)        9
                                 --------  --------  --------  --------
      Total consolidated
        other income             $ 1,607   $ 2,700    $4,335   $ 5,738
                                 ========  ========  ========  ========
</TABLE>

 <PAGE>


                           COMMUNITY BANKSHARES, INC.
                                AND SUBSIDIARIES

                MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL
                      CONDITION AND RESULTS OF OPERATIONS

 Forward Looking Statements
 ----------------------------------------------
 The following appears in accordance with the Securities Litigation Reform
 Act.  These financial statements and financial review include forward looking
 statements that involve inherent risks and uncertainties.  A number of
 important factors could cause actual results to differ materially from those
 in the forward looking statements.  Those factors include fluctuations in
 interest rates, inflation, government regulations, economic conditions, Year
 2000 issues and competition in the geographic business areas in which the
 Company conducts its operations.

 Management Discussion and Analysis
 ----------------------------------------------
 The following is management's discussion and analysis of certain significant
 factors which have affected the Company's financial position and operating
 results during the periods included in the accompanying consolidated
 financial statements.

 Financial Condition

 As of September 30, 1999, the Company continues to experience growth in total
 assets, total loans and total deposits as compared to December 31, 1998.
 Total assets, loans, and deposits increased by 10.64%, 15.40% and 9.06%
 respectively.  The growth in all areas is slightly less than the same period
 last year but consistent with management's expectations. The growth in assets
 is attributable to growth in deposits and retention of earnings.  Management
 expects the growth to continue in the future.

 Liquidity

 As of September 30, 1999, the Liquidity Ratio was 25.01% which is consistent
 with the Company's target range of 20 - 25%.  Liquidity is measured by the
 ratio of net cash, short term and marketable securities to net deposits and
 short term liabilities.

 Interest Rate Risk

 The Company's overall interest rate risk was less than 3% of net interest
 income subjected to rising and falling rates of 200 basis points.

 Capital

 Banking regulation requires the Company to maintain capital levels in
 relation to Company assets.  At September 30, 1999, the Company's capital
 ratios were considered satisfactory based on regulatory minimum capital
 requirements.  The minimum capital requirements and the actual capital ratios
 for the Company at September 30, 1999 were as follows:
 <TABLE>


                                      Actual        Regulatory
                                                       Minimum
    <S>                             <C>               <C>
    Leverage                           8.29%             4.00%
        Risked Based
    Capital ratios:
        Core Capital                  10.65%             4.00%
        Total Capital                 11.90%             8.00%

 </TABLE>
 Results of Operation


 Net interest income for the nine month period ended September 30, 1999 is up
 21.07% over the same period for 1998, from $13,728,000 to $16,621,000, and is
 up 17.98% for the three month period ending September 30, 1999 from
 $4,860,000 to $5,734,000 for 1999.  Interest income was up by 16.22% for the
 nine month period ending September 30, 1999 from $25,464,000 to $29,594,000
 and up 14.00% for the three month period ending September 30, 1999 from
 $8,976,000 to $10,233,000.  Interest expense was up 10.54% or $1,237,000 for
 the nine month period ended September 30, 1999, over the same period in 1998
 and up 9.31% or $383,000 for the three month period ending September 30,
 1999, as compared to 1998.  The increase in interest income is due to an
 increase of 18.43% or $70,683,000 in earning assets from September 30, 1998
 to September 30, 1999.  Investment securities increased slightly by
 $4,774,000 or 6.43% during the period primarily due to funds being used to
 fund loan growth.  Total loans increased during the last year by $48,364,000
 or 15.40%. The increase in interest income, interest expense, and net
 interest income were consistent with the budget projections made by
 management and are on target to be consistent with annual projections.

 The provision for loan losses was $1,027,000 for the first nine months of
 1999.  This provision will fluctuate based on Small Business Administration
 (SBA) loans closed, as we have a policy of reserving 5% of the un-guaranteed
 portion of any SBA loans.  The Company currently has reserves totaling
 $1,042,318 for its un-guaranteed portion of SBA loans.

 The following table furnishes information on the Loan Loss Reserve for the
 current nine month reporting period and the same period for 1999.
 <TABLE>
 <CAPTION>
                                             1999      1998
     <S>                                <C>       <C>
     Beginning Balance                    $ 4,863   $ 4,024

     Less Charge Offs:
          Real Estate Loans                  (23)       (7)
          Commercial Loans                  (279)      (75)
          Consumer Loans                    (427)     (277)
          Credit Cards                       (24)       (8)

     Plus Recoveries
          Real Estate Loans                     4        18
          Commercial Loans                     44        20
          Consumer Loans                      179        89
          Credit Cards                          2         0

     Plus Provision                         1,027       764
                                         --------  --------
     Ending Balance                       $ 5,366   $ 4,548
                                         ========  ========
</TABLE>

The loan loss reserve for the company is evaluated monthly and adjusted to
reflect the risk in the portfolio in the following manner.  We use four
different methods of measuring risk in the portfolio:  (a)  Risk in our watch
list of loans and past due ratios;  (b)  Historical charge offs;  ( c) Peer
group comparisons; and (d)  Percentage of classified loans.  We then compare
results to reserve balances to assure any and all identified risk are covered.

The Provision for Loan Losses for the nine month period ended September 30,
1999 represented 137% of charge offs for the same period, while the provision
for the first nine months of 1998 represented 208% of the charge offs
recorded in that period.  The reserve at the end of September 30, 1999
represented 217% of non accrual loans while the reserve at September 30, 1998
represented 374% of non accrual loans.  Non accrual loans have increased from
$1,215,000 at September 30, 1998 to $2,469,000 as of September 30, 1999.
Past due loans greater than 90 days and accruing interest have increased from
$446,000 in 1998 to $1,464,000 in 1999.  This increase is indicative of a
slight deterioration in loan quality.  Management is aware of this trend and
is in the process of taking steps to address the issue of loan quality.  The
Company is currently outside its policy guideline of maintaining a loan loss
reserve of 200% of non-performing assets.  However, $1,259,000 of non-accrual
loans are guarantee by the Small Business Administration and after taking the
effect of these guarantees into consideration, the Company would be in
compliance with its policy.  The Loan Loss Reserve balance to total loan
ratio at September 30, 1999 was 1.48% as compared to 1.51% at September 30,
1998.  Management considered the Loan Loss Reserve to be adequate to absorb
any losses that may be incurred.

The following table is a summary of Non Accrual, Past due and Restructured
Debt
<TABLE>
<CAPTION>
                               September 30, 1999

                       Non-accrual    Past Due   Restructured
                          Loans       90 days        Debt
                                       Still
                                      accruing
    <S>                <C>          <C>          <C>
    Real Estate Loans             0            0             0
    Commercial Loans          1,770          917           747
    Consumer Loans              699          547             0
                           --------     --------      --------
    Total                     2,469        1,464           747
                           ========     ========      ========

 </TABLE>

 <TABLE>
 <CAPTION>
                               September 30, 1998

                       Non-accrual    Past Due   Restructured
                          Loans       90 days        Debt
                                       Still
                                      accruing
    <S>                <C>          <C>          <C>
    Real Estate Loans            30           55             0
    Commercial Loans            509          127           683
    Consumer Loans              676          264             0
                           --------     --------      --------
    Total                     1,215          446           683
                           ========     ========      ========
 </TABLE>

Loans classified for regulatory purposes as loss, doubtful, substandard, or
special mention that have not been included in the table above do not
represent or result from trends or uncertainties which management reasonably
expects will materially impact future operating results, liquidity or capital
resources.  These classified loans do not represent material credits about
which management is aware of any information which causes management to have
serious doubts as to the ability of such borrows to comply with the loan
payment terms.

The bank places loans on non-accrual at such a time it is apparent that the
collection of all principal and interest is questionable and the loan is
either past due 90 days or bankruptcy has been filed.

Other income decreased by 21.75% or $2,238,000 during the nine month period
ended September 30, 1999 as compared to the same period for 1998 and the
three month period ending September 30, 1999 showed a 39.28% or $1,829,000
decrease over the same three month period of 1998.  The majority of these
decreases, $2,592,000 and $1,952,000, respectively, are due to fewer
installations of supermarket bank units in the first half of 1999 compared to
1998.  In addition, the company received compensation as a result of the
termination of the Company's Master Consulting Agreement with Nationsbanc
Services, Inc. ("Nationsbac") on August 14, 1998, that was non-recurring
income.  Service charges on deposit accounts increased by $246,000 or 13.23%
for the nine month period ended September 30, 1999, and $101,000 or 15.71%
for the three month period ended September 30, 1999, as compared to the same
periods in 1998.  The major increase was the increase in non-sufficient funds
(NSF) charges of $186,000 and $97,000 for the nine month period and the three
month period ended September 30, 1999, respectively, compared to the same
period in 1998.  NSF charges increased primarily as a result of the Company's
continued growth in accounts in the totally free checking program.  The gains
on sale of loans decreased by $133,000 or 35.75% during the nine month period
ended September 30, 1999 as compared to the same period for 1998.  This
decrease is due to a smaller number of SBA loan originations during 1999
compared to 1998.  Trust department income for the first nine months of 1999
increased by 6,000 or 7.23% to $89,000 compared to $83,000 for the first nine
months of 1998.

Other operating expenses increased by 19.24% or $2,824,000 for the nine month
period ended September 30, 1999, and 12.05% or $626,000 for the three month
period ending September 30, 1999 as compared to the same periods in 1998.
Salaries and benefits increased by $1,615,000 or 21.36% during the nine month
period ended September 30, 1999 compared to the same period in 1998.  Full
time equivalent employees increased from 283 at the end of September 1998 to
309 at the end of September 1999.  Equipment and occupancy expenses were up
by 26.47% or $626,000 for the nine month period ended September 30, 1999, and
25.27% or $214,000 for the three month period ending September 30, 1999, as
compared to the same period in 1998. The increase in full time equivalent
employees as well as equipment and occupancy expenses was influenced by the
addition of two supermarket banking center during the past twelve months as
well as the overall growth of the Company's banking operations.  In addition,
the increase in the equipment and occupancy expense is a direct result of the
depreciation and operating expense associated with the Company's new data
processing system which was became fully operational during the first six
months of 1999.

Net income for the nine month period ended September 30, 1999, was $4,335,000
or a decrease of 24.45% and for the three month period ended September 30,
1999, was $1,607,000 or a decrease of 40.48% over the same periods for 1998.
The net income was less than management's budget for both periods primarily
due to fewer sales of supermarket banking units than anticipated during the
first half of the year as well as the compensation received as a result of
the termination of the Company's Master Consulting Agreement with Nationsbanc
Services, Inc. ("Nationsbac") on August 14, 1998, that was not received in
1999.  Management anticipates the sale of supermarket banking units to remain
low during the last half of 1999 primarily due to limited capital expansion
in the banking industry due to Year 2000 concerns.  However, management
expects sales associated with the first phase of an agreement with the
Canadian Imperial Bank of Commerce to start during the last quarter of 1999.
Overall management anticipates income to be less than in 1998 and less than
budgeted for 1999.

The company is not aware of any other known trends, events or uncertainties,
other than the effect of events as described above, that will have or that
are reasonably likely to have a material effect on its liquidity, capital
resources or operations.  The Company is also not aware of any current
recommendations by the regulatory authorities which, if they were
implemented, would have such an effect.

YEAR 2000 COMPLIANCE

The following are forward-looking statements reflecting management's current
assessment and estimates with respect to the Company's year 2000 compliance
efforts and the impact of year 2000 issues on the Company's business and
operations.  Various factors could cause actual plans and results to differ
materially from those contemplated by such assessments, estimates and
forward-looking statements, many of which are beyond the control of the
Company.  Some of these factors include, but are not limited to
representations by the Company's vendors and counterparties, technological
advances, economic considerations, and consumer perceptions.  The Company's
year 2000 compliance program is an ongoing process involving continual
evaluation and may be subject to change in response to new developments.

The Company utilizes and depends upon data processing systems and software to
conduct its business.  The "year 2000 issue" arises from the widespread use
of computer programs that rely on two-digit codes to perform computations or
decision-making functions.  Many of these programs may fail due to an
inability to properly interpret date codes beginning January 1, 2000.   For
example, such programs may misinterpret "00" as the year 1900, rather than
2000.  In addition, some equipment, being controlled by microprocessor chips,
may not deal appropriately with the year "00".

The Company's State of Readiness
------------------------------------------

The Company views year 2000 readiness as not only an information or
technology problem, but as a corporate-wide challenge and has placed the
issue at the forefront of all strategic planning.  The Company's readiness
plan has been designed to cover all aspects of its operations, which include
the current operations, the conversion period and contingency planning in the
event of the failure of a mission critical system.  Based on the complex
nature of the Company's operations, corporate wide objectives have been to:
1) minimize disruptions of service to the institution and its customers, 2)
ensure timely resumption of operations, and 3) limit losses to earnings and
capital.

The Company began evaluating its information technology ("IT") systems and
non-IT systems, which include microcontrollers and other embedded computers,
to ascertain the impact of year 2000 issues in June of 1997.  In l997, a Year
2000 Task Force Committee was organized and the Chief Financial Officer of
the Company was appointed to direct the Company's year 2000 remediation
efforts.  The Committee believes that it has identified and remediated all
major internal business and operational functions that will be impacted by
the date changes.

Remediation of the Company's IT and Non-IT Systems.  The Company's
remediation program was implemented during the first quarter of 1998.  In
general, the Company believes that because the majority of IT equipment and
software is relatively new, and has been certified by the developers as being
year 2000 compliant, such equipment and software  require only minor
modification to become year 2000 compliant.

During the fourth quarter of 1998, management of the Company determined that
it would be necessary to proceed with its traditional software provider, as
opposed to the client-based software as originally planned.  As planned,
modifications to the Company's IT equipment and software were complete on
March 8, 1999.  With respect to the Company's non-IT systems, no remediations
were required.

Record retention policies have been amended to include all year 2000 due
diligence documents and any new acquisition, upgrades to existing systems, or
written agreements are reviewed prior to execution for year 2000 warrants or
guarantees of readiness.

Year 2000 Testing
----------------------------------------------

The Company considers the testing phase of its year 2000 program to be a
significant phase of its year 2000 program.  In May of l998, a Year 2000
Readiness-Key Milestones Testing Plan was adopted that defined the Company's
year 2000 testing strategy (the "Plan").  The Plan will continue to be
modified to address any change in the remediation plans as necessary.  The
Company's testing has been reviewed by employees independent of in-house
testing.  In addition, test results were reported to the Board of Directors
of each Community Banking Subsidiary for evaluation.  The Company
successfully completed its Year 2000 testing prior to June 30, 1999.

Assessment of Third Party Readiness
----------------------------------------------

To the extent possible, the Company has also evaluated the systems of its
major business partners, borrowers and suppliers of products and services.
The Company has sent out a letter and questionnaire to its major borrowers
and suppliers of products and services.  The Company has received a majority
of responses from these parties and notes no significant year 2000 issues.

Costs to Address Year 2000 Issues
----------------------------------------------

The Company does not anticipate that the related overall costs will be
material to the financial condition of the Company for any single year or
quarter.  The Company estimates that costs of assessing, testing, and
remediation issues associated with the year 2000 will total approximately
$1,200,000. Total costs incurred to date with respect to year 2000
remediations are $1,200,000.  The Company anticipates little or no additional
costs relating to the remaining modifications the Company at Y2K readiness.
A majority of these costs have been capitalized, with 62% incurred in
connection with the purchase of new software and 38% required as a result of
the replacement of hardware.  Any expenses relating to the independent audit
of the test results will be deducted from income.

The Company has not used any independent verification and validation
processes to assure the reliability of year 2000 cost estimates.  None of the
Company's IT projects have been deferred due to year 2000 efforts.

Risks of the Year 2000
----------------------------------------------

The Company believes that all significant remediations with respect to the
Company's systems are complete.  However, no assurance can be given that the
Company will not be exposed to potential losses resulting from system
problems associated with the change in date. There can also be no assurance
that the Company's systems that have been designed to be year 2000 compliant
contain all of the necessary date code changes and that systems have been
correctly modified, or will be correctly modified in contemplation of the
year 2000.

In addition to year 2000 compliance in the Company's internal systems, the
impact of year 2000 non-compliance by outside parties with whom the Company
may transact business cannot be accurately gauged.  The year 2000 issue may
have a material impact on the financial condition of the Company if borrowers
of the Company become insolvent and are, therefore, unable to repay loans as
they become due as a result of the borrowers' year 2000 non-compliance.

Certain risk controls to manage the year 2000 related risks posed by
customers have been implemented and the broad categories of customers have
been identified.  They are: 1) Funds Takers, 2) Funds Providers and 3)
Capital Market/Asset Management Counterparties. Based on the analysis of the
previously described groups, the Company is able to look at different
assumptions of risk, liquidity and contingency.  A high level program of
awareness continues in this area with sub-committees of the Board of
Directors of each Community Banking Subsidiary carefully monitoring year 2000
remediation efforts to minimize financial risk.  Lending officers have
attempted to identify economic factors in the Company's trade or assessment
areas that would have an impact on customers as a result of a potential Year
2000 problem and will continue to monitor this potential.

In addition, the Company is reliant upon the Federal Reserve Company of
Atlanta (the "Atlanta Reserve Bank") for electronic funds transfers.  If the
Atlanta Reserve Bank does not successfully complete all modifications
required by the date change, and is forced to interrupt automated services to
the Company, the Company could experience difficulties with respect to making
electronic funds transfers.  The Company believes that the Atlanta Reserve
Bank is aggressively pursuing a year 2000 compliance strategy, and that the
risk associated with year 2000 non-compliance by the Atlanta Reserve Bank is
insignificant.  With the exception of the Atlanta Reserve Bank, the Company
is not aware of any other third party relationships whose year 2000
non-compliance could result in a material adverse effect on the Company's
results of operations, liquidity and financial condition due to the date
change.

Another area of review for year 2000 potential liability has been that of
fiduciary services.  Client assessment management through the bank's trust
department has been identified and will continued to be monitored.

Contingency Plans
----------------------------------------------

The potential impact of business disruptions has placed contingency plan
validation and training at the forefront of Year 2000 planning during .   The
company has established organizational planning guidelines that define the
business continuity planning strategy;  conducted business impact analysis in
all banking centers; developed a business resumption contingency plan that
has directorate approval and established a schedule for plan validation. The
business resumption contingency plan is considered phase II of the company's
overall Plan of Prevention which emphasis disaster prevention.

Plan development has been centered around mission critical and mission
necessary systems. A process of  "event planning" has been used to focus on
each core business process.

The plan validation has been completed.  The Parent Company's internal
auditor has reviewed contingency and validation plans.  A report has been
given to the directorate on plan development, implementation and audit
findings.  Documentation is maintained on all planning and validation
processes and placed in record retention.

Staff wide contingency training has been identified as a primary component of
the company's overall plan.  Monthly contingency planning has been scheduled
in all banking centers during third and fourth quarters with the emphasis on
external forces that could create or compound Year 2000 related risks.

Contingency planning has encompassed liquidity and sources designated that
could be converted to cash quickly.  Management has secured additional lines
through the Federal Home Loan Bank and Federal Reserve.  Other market funds
providers have also been considered.  Affiliate banks have adopted specific
liquidity polices that detail cash on hand, borrowings and net incoming cash
flows.

Customer awareness continues to be on the forefront of the Company's Year
2000 Plan.  Awareness programs include not only information concerning the
Company's Year 2000 readiness but emphasizes avoiding fraudulent Year 2000
schemes.

The Company's continuing due diligence processes in the areas of contingency,
recovery and restoration, training, liquidity and customer awareness should
decrease the bank's vulnerabilities to those external forces outside the
Company's control.  The Company is emphasizing a clean management program
during the last quarter of 1999 to ensure that Year 2000 compliant systems
are not disrupted.

The Company has introduced a program of risk mitigation in order to have a
more heightened sense of potential points of failure.  Change control
processes will be adhered to during the century rollover.  Areas receiving
significant focus will be those which include data entry and processing
controls, controlled user communications and intensified physical security
for the data center.

<PAGE>

                          PART II - OTHER INFORMATION

 ITEM 4.   Submission of Matters to a Vote of Security Holders.


 ITEM 6.   Exhibits and Reports on Form 8-K

(a)   Exhibits

                      Exhibit 27.  Financial Data Schedule

(b)   Reports on Form 8-K

                  None
<PAGE>


                                  SIGNATURES

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



                               COMMUNITY BANKSHARES, INC.


DATE:  September 15, 1999           BY:  /s/  Harry L. Stephens
                               Harry L. Stephens,
                               Executive Vice President and
                               Chief Financial Officer
<PAGE>