`FIRST M & F CORPORATION

                        SECURITIES AND EXCHANGE COMMISSION
                              Washington, D.C.  20459

                                     FORM 10-Q


[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

                        For the quarter ended March 31, 2005

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

                For the transition period from ____________ to _____________

Commission file number 000-09424

                               FIRST M & F CORPORATION
                  (Exact name of registrant as specified in its charter)

                     Mississippi                         64-0636653
          -------------------------------           -------------------
          (State or other jurisdiction of            (I.R.S. Employer
          incorporation of organization)            Identification No.)

             134 West Washington Street
              Kosciusko, Mississippi                      39090
       --------------------------------------          -------------
       Address of Principal Executive Offices             Zip Code

                                 (662) 289-5121
                          -------------------------------
                           Registrant's telephone number

                                    No Change
              ------------------------------------------------------
                Former name, former address and former fiscal year,
                           if changed since last report

Indicate by check mark whether the registrant (1) has filed all reports required by
Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for shorter period that the registrant was required to file such report),
and (2) has been subject to such filing requirements for the past 90 days.

                              Yes   X       No
                                  -----        -----

Indicate by check mark whether the registrant is an accelerated filer (as defined
in Rule 12b-2 of the Exchange Act).

                              Yes   X       No
                                  -----        -----

Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.

            Class                             Outstanding at April 30, 2005
            -----                             -----------------------------

Common stock ($5.00 par value)                       4,498,659 shares`

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                     FORM 10-Q

                                       INDEX

                                                                      Page
                                                                         ----

PART I:  FINANCIAL INFORMATION

  Item 1 - Financial Statements (unaudited):                               3
             Consolidated Statements of Condition                          4
             Consolidated Statements of Income                             5
             Consolidated Statements of Comprehensive Income               6
             Consolidated Statements of Stockholders' Equity               7
             Consolidated Statements of Cash Flows                         8
             Notes to Consolidated Financial Statements                   10
             Report of Independent Registered Public Accounting Firm      14

  Item 2 - Management's Discussion and Analysis of Financial
           Condition and Results of Operation                             15

  Item 3 - Quantitative and Qualitative Disclosures About
           Market Risk                                                    29

  Item 4 - Controls and Procedures                                        30


PART II:  OTHER INFORMATION

  Item 1 - Legal Proceedings                                              30

  Item 2 - Unregistered Sales of Equity and Use of Proceeds               31

  Item 3 - Defaults upon Senior Securities                                31

  Item 4 - Submission of Matters to a Vote of Security
           Holders                                                        31

  Item 5 - Other Information                                              31

  Item 6 - Exhibits                                                       31

SIGNATURES                                                         32

EXHIBIT INDEX

CERTIFICATIONS`

# -2-

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`FIRST M & F CORPORATION

                                        PART I:  FINANCIAL INFORMATION

Item 1 - Financial Statements (Unaudited)`

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                             Consolidated Statements of Condition
                                                          (Unaudited)
                                               (In Thousands, Except Share Data)

                                                                      March 31                   December 31
                                                                      --------                   -----------
Assets                                                         2005               2004               2004
------                                                         ----               ----               ----
Cash and due from banks                                     $  35,134          $  28,328           $  40,376
Interest bearing bank balances                                  6,305              5,614               5,105
Federal funds sold                                              8,850             18,300               3,550
Securities available for sale, amortized cost
   of $197,819, $189,788 and $172,808                         198,354            195,925             175,654
Loans held for sale                                            14,362             12,658              12,236

Loans, net of unearned income                                 849,518            769,082             832,486
   Allowance for loan losses                                  (11,776)           (10,958)            (11,619)
                                                        --------------     --------------    ----------------
      Net loans                                               837,742            758,124             820,867
                                                        --------------     --------------    ----------------

Bank premises and equipment                                    27,475             24,718              26,497
Accrued interest receivable                                     7,498              7,191               7,126
Other real estate                                               3,428              1,157               2,816
Goodwill                                                       16,348             16,348              16,348
Other intangible assets                                           399                457                 413
Bank owned life insurance                                      13,978             13,418              13,849
Other assets                                                   17,645             14,074              17,875
                                                        --------------     --------------    ----------------
                                                          $ 1,187,518        $ 1,096,312         $ 1,142,712
                                                        ==============     ==============    ================

Liabilities and Stockholders' Equity
------------------------------------
Liabilities:
Noninterest-bearing deposits                                $ 136,131          $ 115,895           $ 137,728
Interest-bearing deposits                                     824,743            736,094             739,536
                                                        --------------     --------------    ----------------
     Total deposits                                           960,874            851,989             877,264
                                                        --------------     --------------    ----------------
Short-term borrowings                                          13,762             17,099              16,808
Other borrowings                                               91,454            106,217             128,838
Accrued interest payable                                        1,867              1,375               1,728
Other liabilities                                               6,744              7,772               5,605
                                                        --------------     --------------    ----------------
      Total liabilities                                     1,074,701            984,452           1,030,243
                                                        --------------     --------------    ----------------

Noncontrolling interest in subsidiaries                             1                152                   1
                                                        --------------     --------------    ----------------

Stockholders' equity:
Preferred stock:
   Class A; 1,000,000 shares authorized                             -                  -                   -
   Class B; 1,000,000 shares authorized                             -                  -                   -
Common stock of $5.00 par value; 15,000,000 shares
   authorized: 4,498,659, 4,562,859 and
   4,506,159 shares issued                                     22,493             22,814              22,531
Additional paid-in capital                                     29,349             31,246              29,587
Retained earnings                                              62,187             55,333              60,113
Accumulated other comprehensive income                         (1,213)             2,315                 237
                                                        --------------     --------------    ----------------
      Total stockholders' equity                              112,816            111,708             112,468
                                                        --------------     --------------    ----------------
                                                          $ 1,187,518        $ 1,096,312         $ 1,142,712
                                                        ==============     ==============    ================

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

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                         Consolidated Statements of Income
                                                    (Unaudited)
                                         (In Thousands, Except Share Data)

                                                                        Three Months Ended March 31
                                                                        ---------------------------
Interest income:                                                         2005                2004
                                                                         ----                ----
Interest and fees on loans                                                $13,445           $12,161
Interest on loans held for sale                                               117                93
Taxable investments                                                         1,301             1,392
Tax-exempt investments                                                        518               561
Federal funds sold                                                            118                69
Interest bearing bank balances                                                 66                29
                                                                    --------------    --------------
Total interest income                                                      15,565            14,305
                                                                    --------------    --------------

Interest expense:
Deposits                                                                    3,740             2,818
Short-term borrowings                                                         156               147
Other borrowings                                                              992             1,071
                                                                    --------------    --------------
Total interest expense                                                      4,888             4,036
                                                                    --------------    --------------

Net interest income                                                        10,677            10,269
Provision for loan losses                                                     871             2,460
                                                                    --------------    --------------
Net interest income after
provision for loan losses                                                   9,806             7,809
                                                                    --------------    --------------

Noninterest income:
Service charges on deposit accounts                                         1,705             1,821
Mortgage banking income                                                       148               171
Agency commission income                                                      931               865
Trust and brokerage income                                                    120               110
Bank owned life insurance income                                              129               149
Securities gains (losses), net                                                  -                70
Other income                                                                1,072               791
                                                                    --------------    --------------
Total noninterest income                                                    4,105             3,977
                                                                    --------------    --------------

Noninterest expenses:
Salaries and employee benefits                                              5,223             4,946
Net occupancy expenses                                                        599               572
Equipment expenses                                                            626               653
Software and processing expenses                                              291               338
Telecommunication expenses                                                    199               212
Marketing and business development expenses                                   302               307
Intangible asset amortization                                                  14                32
Other expenses                                                              1,955             1,917
                                                                    --------------    --------------
Total noninterest expenses                                                  9,209             8,977
                                                                    --------------    --------------

Income before income taxes and noncontrolling interests                     4,702             2,809
Income taxes                                                                1,505               768
Noncontrolling interest in losses of subsidiaries,
  net of taxes of $1 and $333                                                  (1)             (560)
                                                                    --------------    --------------

Net income                                                                $ 3,198           $ 2,601
                                                                    ==============    ==============

Earnings per share:
   Basic                                                                  $   .71           $   .57
   Diluted                                                                $   .71           $   .57
                                                                    ==============    ==============

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

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                  Consolidated Statements of Comprehensive Income
                                                    (Unaudited)
                                                  (In Thousands)

                                                                       Three Months Ended March 31
                                                                       ---------------------------
                                                                           2005          2004
                                                                           ----          ----
Net income                                                                $3,198        $2,601

Other comprehensive income:
Change in unrealized gains (losses) on securities
   available for sale, net of tax of $862 and $1                          (1,450)            3
Reclassification adjustment for (gains) losses on securities
   available for sale included in net income, net of
   tax of $0 and $26                                                           -           (44)
Minimum pension liability adjustment, net of tax                               -             -
                                                                       ----------    ----------

Other comprehensive income                                                (1,450)          (41)
                                                                       ----------    ----------

Total comprehensive income                                                $1,748        $2,560
                                                                       ==========    ==========


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

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                  Consolidated Statements of Stockholders' Equity
                                    Three Months Ended March 31, 2005 and 2004
                                                    (Unaudited)
                                         (In Thousands, Except Share Data)

                                                                                             Accumulated
                                                       Additional                               Other
                                        Common           Paid-in           Retained         Comprehensive
                                        Stock            Capital           Earnings             Income              Total
                                     -------------    --------------     -------------     -----------------    ---------------
January 1, 2004                           $22,825           $31,624           $53,873                $2,356          $ 110,678
Net income                                      -                 -             2,601                     -              2,601
Cash dividends ($.25 per share)                 -                 -            (1,141)                    -             (1,141)
34,321 common shares issued
  in exercise of stock options                172               741                 -                     -                913
36,500 common shares
  repurchased                                (183)           (1,119)                -                     -             (1,302)
Net change                                      -                 -                 -                   (41)               (41)
                                     -------------    --------------     -------------     -----------------    ---------------

March 31, 2004                            $22,814           $31,246           $55,333                $2,315          $ 111,708
                                     =============    ==============     =============     =================    ===============

January 1, 2005                           $22,531           $29,587           $60,113                 $ 237          $ 112,468
Net income                                      -                 -             3,198                     -              3,198
Cash dividends ($.25 per share)                 -                 -            (1,124)                    -             (1,124)
2,500 common shares issued
  in exercise of stock options                 12                54                 -                     -                 66
10,000 common shares
  repurchased                                 (50)             (292)                -                     -               (342)
Net change                                      -                 -                 -                (1,450)            (1,450)
                                     -------------    --------------     -------------     -----------------    ---------------

March 31, 2005                            $22,493           $29,349           $62,187              $ (1,213)         $ 112,816
                                     =============    ==============     =============     =================    ===============


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

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                       Consolidated Statements of Cash Flows
                                                    (Unaudited)
                                                  (In Thousands)

                                                                                Three Months Ended March 31
                                                                                ---------------------------
                                                                                    2005             2004
                                                                                    ----             ----
Cash flows from operating activities:
Net income                                                                          $3,198         $2,601
Adjustments to reconcile net income
  to net cash provided by operating activities:
  Depreciation and amortization                                                        480            483
  Provision for loan losses                                                            871          2,460
  Net investment amortization                                                          182            192
  Capitalized dividends on FHLB stock                                                  (46)           (35)
  Net change in unearned fees/deferred costs on loans                                  (18)          (114)
  Net accretion of discount on time deposits                                             7              -
  Gain on securities available for sale                                                  -            (70)
  Gain on loans held for sale                                                          (24)           (31)
  Other asset sale (gains)/losses                                                       59            (57)
  Earnings (loss) of noncontrolling interest                                            (2)          (893)
  Deferred income taxes                                                                 13             64
  (Increase) decrease in:
    Accrued interest receivable                                                       (372)            139
    Cash surrender value of bank owned life insurance                                 (129)           (149)
    Loans held for sale                                                             (2,102)           (493)
    Other assets                                                                       833              58
  Increase (decrease) in:
    Accrued interest payable                                                           139              (4)
    Other liabilities                                                                  598             365
                                                                                -----------    -----------

   Net cash provided by operating activities                                         3,687           4,516
                                                                                -----------    -----------

Cash flows from investing activities:
Purchases of securities available for sale                                         (43,201)        (23,881)
Sales of securities available for sale                                               3,838           9,390
Maturities of securities available for sale                                         14,170           5,991
Redemptions of FHLB stock                                                              868               -
Net (increase) decrease in:
  Interest bearing bank balances                                                    (1,200)         (3,060)
  Federal funds sold                                                                (5,300)        (17,350)
  Loans                                                                            (19,277)         (2,759)
  Bank premises and equipment                                                       (1,418)           (939)
Proceeds from sales of other real estate and other repossessed assets                  823             314
                                                                                -----------    -----------

   Net cash used in investing activities                                           (50,697)        (32,294)
                                                                                -----------    -----------




                                                                                                                (Continued)`

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                       Consolidated Statements of Cash Flows
                                                    (Unaudited)
                                                  (In Thousands)

                                                                              Three Months Ended March 31
                                                                              ---------------------------
                                                                                2005                2004
                                                                                ----                ----
Cash flows from financing activities:
Net increase in deposits                                                         $83,603            $31,763
Net increase (decrease) in short-term borrowings                                  (3,046)             1,894
Proceeds from other borrowings                                                         -             13,400
Repayments of other borrowings                                                   (37,384)           (29,270)
Earnings distributions to noncontrolling interests                                    (5)                 -
Cash dividends                                                                    (1,124)            (1,141)
Common shares issued                                                                  66                913
Common shares repurchased                                                           (342)            (1,302)
                                                                          ---------------    ---------------

   Net cash provided by financing activities                                      41,768             16,257
                                                                          ---------------    ---------------

   Net decrease in cash and due from banks                                        (5,242)           (11,521)

Cash and due from banks at January 1                                              40,376             39,849
                                                                          ---------------    ---------------

Cash and due from banks at March 31                                              $35,134            $28,328
                                                                          ===============    ===============

Total interest paid                                                               $4,749             $4,040
Total income taxes paid                                                                -                246
Income tax refunds received                                                           17                  -

Transfers of loans to foreclosed property                                          1,447                570
                                                                          ===============    ===============


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

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                    Notes to Consolidated Financial Statements
                                         (In Thousands, Except Share Data)`

The accompanying unaudited
condensed consolidated financial statements have been prepared in accordance
with accounting principles generally accepted in the United States of America
for interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all the
information and footnotes required by accounting principles generally accepted
in the United States of America for complete financial statements. In the
opinion of management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. The condensed
consolidated financial statements of First M & F Corporation include the
financial statements of Merchants and Farmers Bank, wholly owned subsidiary, and
the Banks wholly owned subsidiaries, First M & F Insurance Company,
Inc., M & F Financial Services, Inc., M & F Bank Securities Corporation,
M & F Insurance Agency, Inc., M & F Insurance Group, Inc., and M & F
Business Credit, Inc. The consolidated financial statements also include the
Banks 51% ownership in Merchants Financial Services, LLC, an accounts
receivable financing business, and the Banks 55% ownership in MS Statewide
Title, LLC, a title insurance agency.  Certain reclassifications have been made
to the 2004 financial statements to be consistent with the 2005 presentation.
For further information, refer to the consolidated financial statements and
footnotes thereto included in the Companys annual report on form 10-K for
the year ended December 31, 2004.

The Company accounts for
its stock-based employee compensation plans based on the intrinsic value
method provided in Accounting Principles Board Opinion (APB) No. 25,
Accounting for Stock Issued to Employees, and related
interpretations. Because the exercise price of the Companys employee stock
options equals the market price of the underlying stock on the date of grant, no
compensation expense is recognized on option plans.

Statement of Financial
Accounting Standards (SFAS) No. 123, Accounting for Stock-Based
Compensation, as amended by SFAS No. 148, requires pro forma disclosures
for net income and earnings per share for companies not adopting its fair value
accounting method for stock-based employee compensation. The pro forma
disclosures below use the fair value method of SFAS No. 123 to measure
compensation expense for stock-based employee compensation plans.

`Three Months Ended March 31
                                                                       ---------------------------
                                                                        2005                2004
                                                                        ----                ----
Net income, as reported                                                   $3,198            $2,601
Less: Total stock-based employee compensation
expense determined under fair value method
for all awards, net of related tax effects                                     2                21
                                                                    -------------    --------------

Pro forma net income                                                      $3,196            $2,580
                                                                    =============    ==============

Earnings per share:
   Basic - as reported                                                      $.71              $.57
   Basic - pro forma                                                         .71               .57

   Diluted - as reported                                                     .71               .57
   Diluted - pro forma                                                       .71               .57
                                                                    =============    ==============`

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                    Notes to Consolidated Financial Statements
                                         (In Thousands, Except Share Data)


Note 2  (Continued)

The fair value of stock options granted was estimated at the date of grant using the Black-Scholes option pricing model.

The following table is a summary of outstanding options and weighted average exercises.

                                                           Three Months Ended March 31
                                                     2005                                  2004
                                                     ----                                  ----
                                           Number                Price            Number             Price
                                           ------                -----            ------             -----
January 1                                   126,185              $30.16           174,406             $29.55
Exercised                                    (2,500)              26.60           (34,321)             26.60
Expired                                      (3,000)              30.46                 -                  -
Granted                                           -                   -                 -                  -
                                     ---------------    ----------------    --------------    ---------------

March 31                                    120,685              $30.22           140,085             $30.28
                                     ===============    ================    ==============    ===============

In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share-Based Payment" (SFAS 123R). SFAS 123R requires all
share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements
based on their fair values beginning with the first interim or annual period after June 15, 2005. SFAS 123R requires the
Company to determine the appropriate fair value model to use for valuing share-based payments, the amortization method for
compensation cost and the transition method to use at adoption. In March 2005, the SEC issued Staff Accounting Bulletin No.
107 (SAB 107) which summarized the view of the SEC staff on the interaction of SFAS 123R and current SEC rules and
regulations. SAB 107 also addressed the SEC staff's views regarding valuation techniques and assumptions used in determining
the fair value of share-based compensation. In April 2005, the SEC issued a press release announcing the amendment of
compliance dates related to SFAS 123R which would effectively move the Company's adoption date of the new standard to January
1, 2006. The Company does not expect the adoption of SFAS 123R to have a material impact on its financial condition or
results of operations.


Note 3: Allowance for Loan Losses

The following table is a summary of the activity in the Allowance for Loan Losses for the first three months of 2005 and 2004.

                                                          Three Months Ended March 31
                                                          ---------------------------
                                                              2005              2004
                                                              ----              ----
Balance at January 1                                          $11,619         $10,891

Loans charged off                                                (855)         (2,508)
Recoveries                                                        141             115
                                                        --------------  --------------
Net charge-offs                                                  (714)         (2,393)
                                                        --------------  --------------

Provision for loan losses                                         871           2,460
                                                        --------------  --------------

Balance at March 31                                           $11,776         $10,958
                                                        ==============  ==============`

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                    Notes to Consolidated Financial Statements
                                         (In Thousands, Except Share Data)


Note 4:  Earnings Per Share

                                                                              Three Months Ended March 31
                                                                              ---------------------------
                                                                              2005                2004
                                                                              ----                ----
Net income                                                                       $3,198                $2,601
                                                                       =================     =================

Weighted average shares outstanding                                           4,499,048             4,565,225
Add dilutive effect of outstanding options                                       14,024                19,722
                                                                       -----------------     -----------------

   Adjusted dilutive shares outstanding                                       4,513,072             4,584,947
                                                                       =================     =================

Earnings per share:
Basic                                                                              $.71                  $.57
Diluted                                                                             .71                   .57
                                                                       =================     =================

Stock options not included in adjusted
shares due to anti-dilutive effect                                                  334                   201


Note 5:  Goodwill and Other Intangible Assets

Following is a summary of intangible assets, net of accumulated amortization, included in the Consolidated Statements of
Condition:

                                                                                                   Customer
                                                                                   Core             Renewal          Noncompete
                                                               Goodwill          Deposits            Lists           Agreements
                                                               --------          --------            -----           ----------
Balance at December 31, 2003                                    $16,348           $    21          $    289            $   179
Amortization expense                                                  -               (18)               (7)                (7)
                                                          --------------    --------------    --------------    ---------------

Balance at March 31, 2004                                       $16,348           $     3          $    282            $   172
                                                          ==============    ==============    ==============    ===============

Balance at December 31, 2004                                    $16,348           $     -          $    262            $   151
Amortization expense                                                  -                                 (7)                (7)
                                                          --------------    --------------    --------------    ---------------

Balance at March 31, 2005                                       $16,348           $     -          $    255            $   144
                                                          ==============    ==============    ==============    ===============

Amortization expense related to intangible assets is expected to be $41 thousand for the remainder of 2005. Amortization
expense is expected to be $55 thousand per year for the years 2006 through 2009 and $41 thousand for the year 2010.`

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`FIRST M & F CORPORATION AND SUBSIDIARY

                                    Notes to Consolidated Financial Statements
                                         (In Thousands, Except Share Data)`

As discussed in Note 10 to
the December 31, 2004 financial statements, the Bank has a defined benefit
pension plan covering substantially all full time employees of the Bank and its
subsidiaries. The following is a summary of the components of net periodic
benefit costs for the three months ended March 31, 2005 and 2004:

`Three Months Ended March 31
                                                              ---------------------------
                                                                 2005               2004
                                                                 ----               ----
Service cost                                                   $      -          $      -
Interest cost                                                       116               117
Expected return on plan assets                                     (126)             (124)
Amortization of transition asset                                     (2)               (2)
Amortization of prior service costs                                  (9)               (9)
Recognized actuarial (gain) loss                                     55                54
                                                            ------------      ------------

Net pension cost                                               $     34          $     36
                                                            ============      ============`

The Company plans to make
$500 thousand in contributions to the pension plan during the remainder of 2005.

Other liabilities on the
Consolidated Statements of Condition include an accrued benefit liability of
$2.935 million at March 31, 2005 and December 31, 2004 and for $2.918 million at
March 31, 2004 related to the unfunded minimum liability of the Companys
defined benefit pension plan.

The Company made a $75
thousand contribution to the ESOP and $74 thousand in matching contributions to
the 401k plan during the first quarter of 2005.

The following is a summary
of other borrowings at March 31, 2005 and 2004:

`2005            2004
                                                                                 ----            ----
Company's line of credit in the amount of $15,000,000, renewable
annually; secured by approximately 29% of the Bank's common
stock; interest payable annually at .75% below the lender's base rate             $2,641        $6,291

Bank's advances from Federal Home Loan Bank of Dallas, net of
unamortized purchase accounting adjustments of $0 and $161                        88,813        99,926
                                                                             ------------   -----------

                                                                                 $91,454      $106,217
                                                                             ============   ===========`

The Bank has advances from the
Federal Home Loan Bank of Dallas (FHLB) under Blanket Agreements for Advances
and Security Agreements. These agreements allow the Bank to borrow funds from
the FHLB to fund mortgage loan programs and to satisfy certain other funding
needs. The value of mortgage-backed securities and mortgage loans pledged under
these agreements must be maintained at not less than 115% and 150%,
respectively, of the advances outstanding.

---

We have reviewed the accompanying consolidated statements of condition of First M & F Corporation and subsidiary as of March
31, 2005 and 2004, and the related consolidated statements of income, comprehensive income, stockholders' equity and cash
flows for the three-month periods ended March 31, 2005 and 2004. These financial statements are the responsibility of the
Company's management.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A
review of interim financial information consists principally of applying analytical procedures to financial data and making
inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit
conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of
which is expressing an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an
opinion.

Based on our review, we are not aware of any material modifications that should be made to the accompanying interim
consolidated financial statements for them to be in conformity with accounting principles generally accepted in the United
States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States), the consolidated statement of condition of First M & F Corporation and subsidiary as of December 31, 2004, and the
related consolidated statements of income, comprehensive income, stockholders' equity and cash flows for the year then ended
(not presented herein) and in our report dated January 27, 2005, we expressed an unqualified opinion on those consolidated
financial statements. In our opinion, the information set forth in the accompanying consolidated statement of condition as of
December 31, 2004 is fairly stated, in all material respects, in relation to the consolidated statement of condition from
which it has been derived.

---

The following provides a
narrative discussion and analysis of significant changes in the Companys
results of operations and financial condition. This discussion should be read in
conjunction with the interim consolidated financial statements and supplemental
financial data presented elsewhere in this report.

Certain of the information
included in this discussion contains forward looking financial data and
information that is based upon managements belief as well as certain
assumptions made by, and information currently available to management.
Specifically, this discussion includes statements with respect to the adequacy
of the allowance for loan losses, the effect of legal proceedings on the
Companys financial condition, results of operations and liquidity, and
market risk disclosures. Should one or more of these risks materialize or the
assumptions prove to be significantly different, actual results may vary from
those estimated, anticipated, projected or expected. For instance, if the
economy deteriorated and real estate values became depressed, the approximately
77% of the Companys loan portfolio that is secured by real estate could
come under stress, thus possibly requiring additional loan loss accruals. The
Company may not be able to dispose of its foreclosed real estate at prices above
the properties carrying values, thus causing additional losses.
Unfavorable judgments in excess of accrued liabilities related to ongoing
litigation may result in additional expenses. Unanticipated catastrophic loss
claims could occur that would reduce or eliminate the profit sharing revenues of
the insurance agencies. Such claims may also affect the availability of
insurance products for certain classes of customers, thereby reducing commission
revenues available to the agencies. A severe slowing of the economy may affect
the ability of the Companys customers to make timely loan payments, or may
cause customers to use up deposit balances, thereby causing a potential strain
on the Companys liquidity. A much steeper than anticipated increase in
interest rates could cause the Companys net interest margins to decrease,
thereby decreasing net interest revenues. Mortgage originations, and therefore
mortgage revenues, would be hurt by steeply rising interest rates. A poor stock
market could reduce brokerage transactions, therefore reducing investment
brokerage revenues. An unanticipated increase in inflation could cause the
Companys operating costs related to salaries, technology, supplies and
property taxes to increase. Unforeseen new competition from outside the
traditional financial services industry could constrain the Companys
ability to price its products profitably. Investments in the portfolio of the
Companys pension plan may not provide adequate returns to fund the
accumulated and projected plan obligations, thus causing higher annual plan
expenses and requiring additional contributions by the Company. These examples
are not intended to be exhaustive, and describe events, circumstances and
contingencies that may never materialize. Nevertheless, the reader is cautioned
that such types of occurrences, usually outside of the control of the Company,
may cause financial results to be different than the reader or the
Companys management had originally estimated.

Net income for the first
quarter of 2005 was $3.198 million, or $.71 basic and diluted earnings per share
as compared to $2.601 million, or $.57 basic and diluted earnings per share for
the same period in 2004 and $2.640 million, or $.58 basic and diluted earnings
per share for the fourth quarter of 2004. Major factors contributing to the
increased earnings were (1) strong loan growth that occurred throughout 2004 and
into 2005 combined with excellent first quarter deposit growth in 2005, (2) improved
asset quality that resulted in loan loss accruals below those required in the
fourth and first quarters of 2004, (3) solid noninterest revenue growth over the
fourth quarter of 2004 and (4) sound expense control, resulting in a decrease in
noninterest expense from the fourth quarter of 2004. Net interest margins were down
from the fourth quarter of 2004 and the first quarter of 2004 as market rates steadily
increased throughout 2004. The Companys stock buy-back program during 2004
was another positive contributor to the increased earnings per share over the fourth
and first quarters of 2004.

---

Highlights for the first
three months of 2004 and 2005 are as follows:

`o   Return on assets for the first quarter of 2005 was 1.09% while the return on equity was 11.20%, both solid
         improvements over the 2004 first quarter results
     o   Loan growth in DeSoto County continued to be strong in the first quarters of 2004 and 2005
     o   Opened a fourth branch in Rankin County at Flowood in February, 2004
     o   Opened a loan production office in Memphis during December, 2004 and saw encouraging initial growth in the first
         quarter of 2005
     o   Currently building an additional branch location in Southaven
     o   Plan to add a new location which will house a branch facility and several fee-generating services in Madison within
         the next 12 months
     o   Began a deposit growth campaign in February of 2005 that was on track at the end of the first quarter in moving
         toward the June goal
     o   Continued the expansion of the insurance agency network by placing a full-service agent in the Olive Branch location
         in February of 2005
     o   Nonperforming loans were .35% of total loans at March 31, 2005, with annualized net charge-offs as a percentage of
         average loans at .34% for the first quarter of 2005, all improved over the 2004 first and fourth quarter statistics`

---

`FIRST M & F CORPORATION

The following table shows the quarterly net loan, non-interest bearing deposit, and interest bearing
deposit growth for the last five quarters.

(Net change, in thousands)
                                                       Non-Interest                         Interest
       Quarter               Loans                   Bearing Deposits                   Bearing Deposits
----------------------- -----------------         -----------------------            ------------------------
1st Qtr 2004                 $       (74)                  $      (7,296)                     $      39,059
2nd Qtr 2004                      11,245                          11,260                            (12,834)
3rd Qtr 2004                      46,532                           2,457                             (4,489)
4th Qtr 2004                       5,627                           8,116                             20,764
1st Qtr 2005                      17,032                          (1,597)                            85,207


The following table shows the quarterly net interest income, loan loss accruals, non-interest income and
non-interest expense amounts for the last five quarters.

(Net amount, in thousands)

                             Net Interest           Loan Loss          Non-Interest           Non-Interest
        Quarter                 Income              Accruals              Income                Expense
------------------------- -------------------     --------------      ----------------      -----------------
1st Qtr 2004                   $      10,269         $    2,460          $      3,977            $     8,977
2nd Qtr 2004                          10,007                999                 3,693                  8,890
3rd Qtr 2004                          10,304                620                 3,845                  9,485
4th Qtr 2004                          10,661              1,273                 3,652                  9,643
1st Qtr 2005                          10,677                871                 4,105                  9,209


The following table shows the components of diluted earnings per share for the last five quarters:

                             1st Qtr 2005       4th Qtr 2004      3rd Qtr 2004       2nd Qtr 2004     1st Qtr, 2004
                             --------------    ---------------    --------------    ---------------   ---------------
Net interest income                 $ 2.37             $ 2.35            $ 2.27             $ 2.19            $ 2.24
Loan loss expense                      .19                .28               .14                .22               .54
Noninterest income                     .91                .80               .85                .81               .87
Noninterest expense                   2.05               2.12              2.09               1.95              1.96
                             --------------    ---------------    --------------    ---------------   ---------------
Net income before taxes               1.04                .75               .89                .83               .61
Income taxes                           .33                .21               .27                .25               .16
Noncontrolling interest                  -               (.04)              .01               (.02)             (.12)
                             --------------    ---------------    --------------    ---------------   ---------------
Net income                           $ .71              $ .58             $ .61              $ .60             $ .57

Noncontrolling interest is an expense representing the earnings (losses) due to (from) minority owners in
subsidiaries in which the Company has a greater than 50% ownership. Therefore,
negative amounts increase the Companys earnings.`

---

`FIRST M & F CORPORATION

The following table shows performance ratios for the last five quarters:

                                          1st Qtr 2005       4th Qtr 2004       3rd Qtr 2004      2nd Qtr 2004        1st Qtr 2004
                                         ---------------    ---------------    --------------    ---------------     ---------------

Net interest margin                              4.13%              4.25%             4.24%              4.19%               4.24%
Efficiency ratio                                60.94              65.80             65.41              63.25               61.47
Return on assets                                 1.09                .93              1.00               1.01                 .94
Return on equity                                11.20               9.34              9.98               9.87                9.29
Noninterest income to avg. assets                1.40               1.28              1.39               1.35                1.44
Noninterest income
  to revenues (1)                               27.17              24.92             26.51              26.27               27.23
Noninterest expense to avg assets                3.14               3.39              3.43               3.26                3.25
Salaries and benefits to total
   noninterest expense                          56.72              56.22             56.52              55.80               55.10
Contribution margin (2)                         65.43              63.01             63.04              64.70               66.13
Nonperforming loans to loans                      .35                .47               .75                .66                1.11
Annualized net charge offs as a
   percent of average loans                       .34                .94               .05                .09                1.25
     (1) Revenues equal tax-equivalent net interest income before loan loss expense, plus noninterest income.
     (2) Contribution margin equals revenues minus salaries & benefits, divided by revenues.


The following table shows revenue related performance statistics for the last five quarters:

(Amounts in thousands)
                                        1st Qtr 2005       4th Qtr 2004       3rd Qtr 2004       2nd Qtr 2004       1st Qtr 2004
                                        ---------------    ---------------    ---------------    ---------------    ----------------
Mortgage originations                      $  12,916          $  21,942          $  12,916          $  21,942           $  14,987
Commissions from annuity sales                   124                130                124                130                  63
Trust revenues                                    55                 66                 55                 66                  69
Retail investment revenues                        32                 59                 32                 59                  41
Revenues per FTE employee                         32                 31                 32                 31                  33
Agency commissions per agency
   FTE employee (1)                               18                 19                 21                 18                  18
     (1) Agency commissions are property, casualty, life and health commissions produced by the insurance agency personnel.


The following table shows additional statistics for the Company at the end of the last five quarters:

                                        1st Qtr 2005       4th Qtr 2004       3rd Qtr 2004       2nd Qtr 2004       1st Qtr 2004
                                        ---------------    ---------------    ---------------    ---------------    ----------------
Full-time equivalent employees                   466                459                461                460                 445
Number of noninterest-bearing
   deposit accounts                           31,745             30,792             30,687             30,410              30,014`

---

Net interest income before
loan loss expenses for the first quarter of 2005 was $10.677 million as compared
to $10.269 million for the same period in 2004. Earning asset yields increased
by 12 basis points from the first quarter of 2004. Liability costs increased by
27 basis points over the first quarter of 2004. This caused the spread between
earning asset yields and liability costs to decrease by 15 basis points from the
first quarter of 2004. However, the net interest margin dropped by only 11 basis
points for the same periods. This smaller decrease was the result of loan growth
and noninterest-bearing deposit growth. Average loans as a percent of average
earning assets increased to 79.16% in the first quarter of 2005 from 76.43% in
the first quarter of 2004. Average costing liabilities as a percent of average
assets decreased from 78.71% in the first quarter of 2004 to 78.12% in the first
quarter of 2005. An influencing factor in this trend was a 19.98% increase in
average noninterest-bearing deposits from the first quarter of 2004 to the first
quarter of 2005.

The Company produced
excellent loan growth year-over-year, especially in the Lafayette, Rankin and
Desoto County markets as well as in the Memphis asset-based lending subsidiary.
Although loan yields improved by only 3 basis points from the first quarter of
2004 to the first quarter of 2005 the increased loan volumes and short-term
funds have helped to support interest income growth and earning asset yields,
which increased by 12 basis points during the same period. Over the past twelve
months the Company has used borrowings for match-funding certain loans and
brokered deposits to provide needed liquidity. Deposit costs increased
throughout 2004 and into 2005 due to the general interest rate environment. The
Company also became more aggressive with deposit pricing during 2004 as market
forces created higher demand for deposit funding among competitor banks. This
adjustment to pricing strategy resulted in interest-bearing deposits becoming
much more sensitive to changes in market rates than in prior years. Loan yields
reacted similarly, but at a more measured pace due to the characteristics of the
floating-rate portion of the portfolio. During the early months of 2004, the
prime rate had to increase several times before many of the floating-rate loans
moved above their floor rates. Until that time, they were essentially fixed-rate
loans. Although the market for loans has become more competitive, the Company
has maintained a pricing discipline emphasizing profitable pricing over
aggressive, discount pricing. Approximately 20% of the loan portfolio has
floating rates that reprice at least as often as quarterly. Going forward the
Company will continue to emphasize noninterest-bearing deposit growth and loan
growth in an effort to support net interest margins. The Company also will
continue to use borrowings and certificate of deposit special promotions when
needed to maintain targeted liquidity levels.

---

`FIRST M & F CORPORATION

The following table shows the components of the net interest margin for the quarter-to-date periods ending on March 31 of
2005 and 2004:

                                                                                    Yields/Costs
                                                                                    ------------
                                                                                   Quarter-to-Date
                                                                                   ---------------
                                                                          March 31, 2005        March 31, 2004
                                                                          --------------        --------------
Short term funds                                                                  2.49%                  .94%
Taxable investments                                                               4.08                  4.34
Tax-exempt investments                                                            6.47                  6.64
Loans held for sale                                                               3.53                  3.03
Loans held for investment                                                         6.39                  6.36
                                                                    -------------------    ------------------
   Earning asset yield                                                            5.97                  5.85

NOW & MMDA                                                                        1.11                   .66
Savings                                                                           1.56                  1.28
Certificates of deposit                                                           2.59                  2.33
Short-term borrowings                                                             3.87                  3.26
Other borrowings                                                                  3.74                  3.69
                                                                    -------------------    ------------------
   Cost of interest-bearing liabilities                                           2.13                  1.86
                                                                    -------------------    ------------------

Net interest spread                                                               3.84                  3.99
Effect of non-interest bearing deposits                                            .28                   .22
Effect of leverage                                                                 .01                   .03
                                                                    -------------------    ------------------
   Net interest margin, tax-equivalent                                            4.13                  4.24
   Less: Tax equivalent adjustments:
 Investments                                                                       .11                   .13
 Loans                                                                             .01                   .01
                                                                    -------------------    ------------------
   Reported book net interest margin                                              4.01%                 4.10%


The following table shows average balance sheets for the quarter-to-date periods ending on March 31 of 2005 and 2004:

(Amounts in thousands)
                                                                                   Quarter-to-Date
                                                                                   ---------------
                                                                         March 31, 2005        March 31, 2004
                                                                         --------------        --------------
Short term funds                                                               $ 29,487               $41,638
Taxable investments                                                             128,116               128,433
Tax-exempt investments                                                           51,062                53,973
Loans held for sale                                                              13,272                12,338
Loans held for investment                                                       842,999               766,377
                                                                     -------------------    ------------------
   Earning assets                                                             1,064,936             1,002,759
Other assets                                                                    109,099               101,872
                                                                     -------------------    ------------------
   Total assets                                                             $ 1,174,035           $ 1,104,631

NOW & MMDA deposits                                                             320,961               295,986
Savings deposits                                                                 86,344                87,687
Certificates of deposit                                                         387,500               351,722
Short-term borrowings                                                            16,092                18,005
Other borrowings                                                                106,252               116,096
                                                                     -------------------    ------------------
   Interest-bearing liabilities                                                 917,149               869,496
                                                                     -------------------    ------------------
Noninterest-bearing deposits                                                    136,200               113,517
Other liabilities                                                                 6,439                 9,668
Stockholders' equity                                                            114,247               111,950
                                                                     -------------------    ------------------
   Liabilities and stockholders' equity                                     $ 1,174,035           $ 1,104,631

Loans to earning assets                                                          79.16%                76.43%
Loans to assets                                                                  71.80%                69.38%
Earning assets to assets                                                         90.71%                90.78%
Noninterest-bearing deposits to assets                                           11.60%                10.28%
Equity to assets                                                                  9.73%                10.13%`

---

`FIRST M & F CORPORATION

The following table shows prime rate changes during 2004 and 2005:

                                                    Changed       Changed
                                                      from:          to:
                                                      ----           --
June 30, 2004                                        4.00%         4.25%
August 10, 2004                                      4.25%         4.50%
September 21, 2004                                   4.50%         4.75%
November 10, 2004                                    4.75%         5.00%
December 14, 2004                                    5.00%         5.25%
February 2, 2005                                     5.25%         5.50%
March 22, 2005                                       5.50%         5.75%`

Management believes that
the Federal Reserve will continue to raise short-term interest rates for the
foreseeable future. However, management believes that market rates will increase
steadily rather than sharply, which should provide opportunities for rebalancing
asset and liability mix and durations as needed to allow for the reasonable
management of future net interest margins.

The provision for loan
losses for the first quarter of 2005 was $871 thousand as compared to $2.460
million for the first quarter of 2004. The provision in 2004 included $1.5
million of additional accruals related to a $2.0 million loan loss incurred in a
51% owned accounts receivable factoring company. The factoring company
experienced a significant deterioration in one account, resulting in a
charge-off of $2.0 million with a remaining balance of $1.5 million being placed
on nonaccrual status. In the fourth quarter of 2004, after applying the proceeds
from the liquidation of collateral, the remaining balance of approximately $950
thousand was charged off. The allowance for loan losses as a percentage of loans
was 1.39% at March 31, 2005, 1.40% at December 31, 2004, and 1.42% at March 31,
2004. Net charge-offs were $714 thousand for the first quarter of 2005 as
compared to $2.393 million for the first quarter of 2004.

Nonperforming loans as a
percentage of loans declined to .35% at March 31, 2005 from 1.11% at March 31,
2004. Management believes that the positive trend in loan quality is
sustainable, given a stable economy. Management stratifies and reviews certain
sectors of the portfolio to detect if there are weaknesses related to economic,
environmental or other customer-specific factors. The Companys loan review
personnel also monitor portfolios by geographic sector to address local credit
issues expeditiously.

---

Noninterest income,
excluding securities transactions, for the first quarter of 2005 was $4.105
million as compared to $3.907 million for the same period in 2004. Deposit revenues
continued to decrease as they fell from $1.815 million in the fourth quarter of
2004 to $1.705 million in the first quarter of 2005. Lack of overdraft fee
transaction volumes as well as continued growth in the free checking product
contributed to this trend. However, debit card transaction volumes continued to
increase, providing a 58.81% improvement in revenues over the first quarter of
2004. Mortgage banking income decreased to $148 thousand for the first quarter
of 2005 from $166 thousand for the fourth quarter of 2004 and $171 thousand for
the first quarter of 2004. The interest rate environment had a significant
dampening effect on mortgage revenues. Agency commission income increased by $66
thousand over the first quarter of 2004 with annuity commissions providing $35
thousand, title insurance commissions providing $17 thousand and the insurance
agency subsidiaries providing $14 thousand of the growth. The Company continued
its strategy of placing agents in branch locations by adding an insurance agent
to the Desoto County banking operation in February of 2005. Other income was up
in 2005 primarily due to contingency income received by the property and
casualty insurance business. Contingency revenues, based upon new business and
claims experience, were $454 thousand in 2005 as compared to $275 thousand for
the first three months of 2004. Other income also increased due to the receipt
of $110 thousand as a member of the PULSE network upon its acquisition by the
Discover Financial Services network.

Securities gains of
approximately $70 thousand were incurred in the first quarter of 2004 to
restructure part of the investment portfolio. Approximately $6.7 million of
mortgage-backed securities were sold and replaced with corporate securities.
This was done to match the investments more closely with their funding sources.

The Company has a strategy
to increase noninterest revenues as a proportion of total revenues over time.
Management plans to do this by continuing to (1) emphasize fee-based services to
deposit customers, (2) grow the trust and retail brokerage businesses and (3)
emphasize corporate treasury and cash management services to play a vital part
in the success of our commercial customers. Increased noninterest revenues would
contribute to a more stable revenue base, mitigating the income statement
effects of changing interest rates.

Noninterest expenses were
up by 2.58% in the first quarter of 2005 as compared to the same period in 2004.
Salary and benefit expenses produced the largest increases with a 5.60% increase
over the first quarter of 2004. However, salaries and benefits decreased by
3.65% from the fourth quarter of 2004. The number of full-time equivalent
employees increased to 466 at March 31, 2005 as compared to 459 at December 31,
2004 and 445 at March 31, 2004. Much of the increase occurred during the second
and third quarters of 2004, primarily in the retail branch and insurance agency
staffs as the Bank expanded its presence in Rankin and DeSoto counties,
continued to build the asset-based lending operation in Memphis and expanded
retail brokerage and insurance agency services.

The business expansion
efforts during 2004 also produced an increase in related occupancy expenses.
This resulted in a 4.72% increase in occupancy expense in the first quarter of
2005 over the first quarter of 2004.

Income tax expense for the
first quarter of 2005 was almost double the expense for the first quarter of
2004 as pre-tax earnings increased by 67.39% for the same period. The effective
tax rates for the first quarter periods in 2005 and 2004 were 32.01% and 27.34%
respectively. Effective tax rates increased over the course of 2004 with the
effective rate for the year averaging 28.98%. The increasing trend is due (1) to the
higher percentage of taxable revenues to total revenues over time as the Company
continues to build the loan portfolio as a percentage of total earning assets and
(2) the losses of MFS included in net income before taxes which resulted in tax
benefits for the Company in 2004.

---

The $560 thousand negative
balance in noncontrolling subsidiary losses in 2004 is the amount of losses, net
of tax benefits of $333 thousand, primarily the result of a $2.0 million loan
loss, attributable to the other minority owner in the Merchants Financial
Services (MFS) factoring business. The business was substantially curtailed by
the end of 2004, with all performing receivables being sold to the owners of
MFS.

Assets were up by 3.92% in
the first three months of 2005 as compared to 1.67% in the first three months of
2004. Total assets were up by 8.32% from March 31, 2004. Investments increased
by 12.92% in the first three months of 2005 and increased by 4.45% during the
first three months of 2004. The Company purchased $21.827 million in government
agency securities and $17.464 million in mortgage-backed securities during the
first quarter of 2005. The purchases replaced $13.000 million in proceeds from
agency security maturities and $3.474 million in mortgage-backed security
principle payments received. The remaining purchases were made from excess
liquidity that resulted from the first quarter deposit growth. The Company
increased investments during the first quarter of 2004 in corporate securities
by $5.309 million, while increasing agency securities and mortgage-backed
securities by approximately $2.000 million each. Loans grew by 2.05% during the
first quarter of 2005, but were up by 10.46% from March 31, 2004. The low loan
growth in 2005, coupled with high deposit growth, provided excess liquidity that
management deployed into liquid government agency securities and mortgage-backed
securities. The Company used the liquidity provided by investment maturities
during 2004 to fund loan growth in the second and third quarters. Management
anticipates healthy loan demand in the second and third quarters of 2005 and
expects to be able to fund the growth through some of the investment cash flows
if needed, but primarily through deposits and match-funded borrowings. Loan
growth in 2005 has occurred primarily in real estate commercial credits.
Management expects that commercial real estate loans as well as other commercial
business loans will provide most of the loan growth in the near future.
Metropolitan areas such as Madison, Rankin, and DeSoto counties as well as
Memphis, Tennessee provide the majority of the Companys lending activity
and should continue to do so through 2005. Loan growth during the third quarter
of 2004 required liquidity from the investment portfolio as well as from
borrowings. Loans as a percent of total assets were 71.54% at March 31, 2005 as
compared to 72.85% at December 31, 2004 and 70.15% at March 31, 2004. Management
believes that one of the keys to the Companys future success will be to
continue to expand into markets that are vital economically and can provide high
loan demand.

---

`FIRST M & F CORPORATION

The following table shows loans held for investment by type as of March 31, 2005, December 31, 2004, and March 31, 2004.

                                          March 31, 2005                     December 31, 2004                 March 31, 2004
                                      ------------------------             -----------------------          ----------------------
Commercial real estate                              $ 431,285                           $ 416,177                       $ 370,893
Residential real estate                               240,797                             237,746                         231,565
Other commercial                                      129,827                             127,611                         112,271
Consumer                                               43,869                              46,677                          50,559
Other loans                                             3,740                               4,275                           3,794
                                      ------------------------             -----------------------          ----------------------
   Total                                            $ 849,518                           $ 832,486                       $ 769,082
                                      ------------------------             -----------------------          ----------------------


Mortgages held for sale                             $   2,247                           $     923                       $   2,653
Student loans held for sale                            12,115                              11,313                          10,005`

Deposits increased by 9.53%
during the first three months of 2005 as compared to increasing by 3.87% during
the first three months of 2004. Deposits grew by $83.610 million in the first
quarter of 2005 with public funds deposits contributing $64.585 million of that
increase. Much of the public funds growth in the first quarter of 2005 occurred
in NOW and MMDA balances with one large relationship providing over half of that
growth. Retail and commercial deposits increased by $10.146 million in NOW, MMDA
and savings balances while increasing by $9.562 million in certificates of
deposit. The large growth in public funds deposits is a natural trend that
occurs during the early months of the year as tax receipts are collected. The
funds generally move out during the summer months as spending occurs. However,
the one large new public fund relationship, which provided NOW deposit growth,
was procured under a two-year contract and should not be as volatile as
traditional public deposits. Managements strategic initiative is to build
the core customer deposit base and rely less on borrowed funds as a primary
source of liquidity. However, when borrowed funds are less costly than time
deposits, the Company will still look to those sources to help maintain the
spread between the yield on earning assets and the cost of funds.

The following table shows
the deposit mix as of March 31, 2005, December 31, 2004, and March 31, 2004.

`March 31, 2005                    December 31, 2004                 March 31, 2004
                                       ------------------------            -----------------------          ----------------------
Noninterest-bearing demand                           $ 136,131                          $ 137,728                       $ 115,895
NOW deposits                                           228,440                            149,572                         144,513
Money market deposits                                  124,984                            122,409                         150,985
Savings deposits                                        87,250                             85,342                          86,992
Certificates of deposit                                384,069                            382,213                         353,604
                                       ------------------------            -----------------------          ----------------------
   Total                                             $ 960,874                          $ 877,264                       $ 851,989


The following table shows the mix of public funds deposits as of March 31, 2005, December 31, 2004, and March 31, 2004.

                                         March 31, 2005                      December 31, 2004                 March 31, 2004
                                     ------------------------              -----------------------          ----------------------
Noninterest-bearing demand                         $   4,187                            $   5,101                       $   4,668
NOW deposits                                         120,538                               59,241                          58,446
Money market deposits                                 33,294                               21,394                          27,427
Savings deposits                                         307                                  299                             562
Certificates of deposit                               66,830                               74,536                          61,271
                                     ------------------------              -----------------------          ----------------------
   Total                                           $ 225,156                            $ 160,571                       $ 152,374`

Other borrowings decreased
by $37.384 million during the first three months of 2005 after increasing by
$6.805 million over the course of 2004. The decreases were the result of matured
borrowings that the Company procured primarily during the third quarter of 2004
to provide liquidity for loan funding in the face of decreasing deposit
balances. The first quarter, 2005 deposit growth provided the funds to pay off
the maturing borrowings in full. Other borrowings consist of Federal Home Loan
Bank (FHLB) borrowings, most of which were originated to fund loan growth. The
Company also has debt of $2.641 million which is the remaining balance of debt
that was used primarily to repurchase stock, beginning in 1999 and continuing
through 2004.

---

The Companys and
Banks regulatory capital ratios at March 31, 2005, as shown below are in
excess of the minimum requirements and qualify the institution as well
capitalized under the risk-based capital regulations.

`First M & F Corporation                 M & F Bank
                                                                       -----------------------                 ----------
                                                                        Amount            Ratio           Amount            Ratio
                                                                        ------            -----           ------            -----
Actual:
Total risk-based capital                                                $ 107,157        11.74%           $ 107,381        11.78%
Tier 1 capital                                                             95,734        10.49%              95,972        10.53%
Leverage                                                                   95,734         8.27%              95,972         8.30%

For Capital Adequacy Purposes:
Total risk-based capital                                                  73,015>         8.00%             72,932>         8.00%
Tier 1 capital                                                            36,508>         4.00%             36,466>         4.00%
Leverage                                                                  46,291>         4.00%             46,249>         4.00%

To Be Well Capitalized Under Prompt
Corrective Action Provisions:
Total capital                                                                                               91,165>        10.00%
Tier 1 capital                                                                                              54,699>         6.00%
Leverage                                                                                                    57,811>         5.00%`

The Company repurchased
36,500 shares during the first three months of 2004 at an average price of
$35.70 per share. The Company also issued 34,321 shares related to the exercise
of stock options during the first three months of 2004 at an average exercise
price of $26.60 per share. The Company repurchased 10,000 shares during the
first three months of 2005 at an average price of $34.23 per share. The Company
also issued 2,500 shares related to the exercise of stock options during the
first three months of 2005 at an average exercise price of $26.60 per share.
Management is currently evaluating whether to initiate a new stock repurchase
program when the current program ends on April 30, 2005.

Responsibility for managing
the Companys program for controlling and monitoring interest rate risk and
liquidity risk and for maintaining income stability, given the Companys
exposure to changes in interest rates, is vested in the asset/liability
committee. Appropriate policy and guidelines, approved by the board of
directors, govern these actions. Monitoring is primarily accomplished through
monthly reviews and analysis of asset and liability repricing opportunities,
market conditions and expectations for the economy. Cash flow analyses are also
used to project short-term interest rate risks and liquidity risks. Management
believes, at March 31, 2005, there is adequate flexibility to alter the current
rate and maturity structures as necessary to minimize the exposure to changes in
interest rates, should they occur. The Company is currently in a positive gap
position for assets and liabilities repricing within the next year. This
generally means that for assets and liabilities maturing and repricing within
the next 12 months, the Company is positioned for more assets to mature and
reprice than it has in liabilities maturing and repricing.

The asset/liability
committee further establishes guidelines, approved by appropriate board action,
by which the current liquidity position of the Company is monitored to ensure
adequate funding capacity. Accessibility to local, regional and other funding
sources is also maintained in order to actively manage the funding structure
that supports the earning assets of the Company. These sources are primarily
correspondent banks, the Federal Home Loan Bank and the Federal Reserve.

---

The Company measures and
monitors credit quality on an ongoing basis through credit committees and the
loan review process. Credit standards are approved by the Board with their
adherence monitored during the lending process as well as through subsequent
loan reviews. The Company strives to minimize risk through the diversification
of the portfolio geographically within Mississippi as well as by loan purpose
and collateral.

The Banks credit
standards are enforced within the Bank as well as within all of its wholly-owned
and majority-owned subsidiaries. Management will apply the Companys credit
policies as well as other quality and internal control standards in any future
business ventures in which it is a partner and within any companies in which it
acquires a controlling interest.

The adequacy of the
allowance for loan losses is monitored quarterly with provision accruals
approved by the Board. Allowance adequacy is dependent on loan classifications
by external examiners as well as by internal loan review personnel, past due
loans, loan growth and loss history. The allowance as a percentage of loans at
March 31, 2005 is comparable to other peer banks.

The following table shows
non-performing loans and other assets of the Company:

`(Amounts in thousands)
                                                                     March 31             December 31              March 31
                                                                       2005                   2004                    2004
                                                                       ----                   ----                    ----
Nonaccrual loans                                                    $       2,083           $       3,302           $       7,349
Past due 90 days or more and still
   accruing interest                                                          917                     645                   1,317
                                                              --------------------    --------------------    --------------------
Total non-performing loans                                                  3,000                   3,947                   8,666
Other real estate                                                           3,428                   2,816                   1,157
                                                              --------------------    --------------------    --------------------

Total non-performing assets                                         $       6,428           $       6,763           $       9,823
                                                              ====================    ====================    ====================

Ratios:
Non-performing loans to loans                                                .35%                    .47%                   1.11%
Non-performing assets to assets                                              .54%                    .59%                    .90%
                                                              ====================    ====================    ====================`

The Companys primary
off-balance sheet arrangements are in the form of loan commitments and operating
lease commitments. At March 31, 2005 the Company had $146.362 million in unused
loan commitments outstanding. Of these commitments, $71.577 million mature in
one year or less. Lines of credit are established using the credit policy of the
Company concerning the lending of money.

Letters of credit are used
to facilitate the borrowers business and are usually related to the
acquisition of inventory or of assets to be used in the customers
business. Letters of credit are generally secured and are underwritten using the
same standards as traditional commercial loans. Most standby letters of credit
expire without being presented for payment. However, the presentment of a
standby letter of credit would create a loan receivable from the Banks
loan customer. The Banks asset-based lending subsidiary uses commercial
letters of credit to facilitate the purchase of inventory items by its
customers. There were $98 thousand in commercial letters of credit outstanding
at the end of the third quarter. At March 31, 2005 the Company had $24.643
million in financial standby letters of credit issued and outstanding.

A liability of $132
thousand is recognized in Other Liabilities related to the obligation to stand
ready to perform related to standby letters of credit.

---

In the ordinary course of
business the Company enters into rental and lease agreements to secure office
space and equipment. The Company has a variety of lease agreements in place, all
of which are operating leases. The largest lease obligations are for office
equipment and mainframe computer systems.

The Company did not have
any variable interest entities or other off-balance sheet vehicles as of March
31, 2005.

The following table
summarizes the obligations of the Company:

`(Amounts in thousands)
                                                                                 Payments Due by Period
                                                                                 ----------------------
                                                                           Less                                           More
                                                                          Than 1         1 - 3           3 - 5           Than 5
Contractual Obligations                                   Total            Year          Years           Years           Years
-----------------------                                   -----            ----          -----           -----           -----
Long-term debt                                            $88,813         $19,116        $38,846         $16,743          $14,108
Capital lease obligations                                       -               -              -               -                -
Operating leases                                            2,690           1,036          1,367             276               11
Purchase obligations                                            -               -              -               -                -
Other long-term liabilities                                     -               -              -               -                -
                                                       -----------     -----------    -----------    ------------    -------------
   Total                                                  $91,503         $20,152        $40,213         $17,019          $14,119
                                                       ===========     ===========    ===========    ============    =============`

The preparation of the
Companys financial statements requires management to make certain
judgments and assumptions in determining critical accounting estimates that
affect the reported amounts of assets, liabilities, revenues and expenses, and
related disclosures of contingent assets and obligations. Management evaluates
these judgments and estimates on an ongoing basis to determine if changes are
needed. Management believes that the following critical accounting policies
affect the more significant judgments and estimates used in the preparation of
the Companys consolidated financial statements.

The Companys policy
is to maintain the allowance for loan losses at a level that is sufficient to
absorb estimated probable losses in the loan portfolio. Accounting standards
require that loan losses be recorded when management determines it is probable
that a loss has been incurred and the amount of the loss can be reasonably
estimated. Managements estimate is reflected in the balance of the
allowance for loan losses. Changes in this estimate can materially affect the
provision for loan losses, and thus net income.

Management of the Company
evaluates many factors in determining the estimate for the allowance for loan
losses. Historical loan losses by loan type and loan grade are a significant
factor in estimating future losses. Management reviews loan quality on an
ongoing basis to determine the collectibility of individual loans and reflects
that collectibility by assigning loan grades to individual credits. The grades
will generally determine how closely a loan will be monitored on an ongoing
basis. A customers payment history, financial statements, cash flow
patterns and collateral, among other factors, are reviewed to determine if the
loan has potential losses. Concentrations of credit by loan type and collateral
type are reviewed to determine exposures and risks of loss. General economic
factors as well as economic factors for individual industries or factors that
would affect certain types of loan collateral are reviewed to determine the
exposure of loans to economic fluctuations. The Company also has a loan review
department that audits types of loans as well as geographical segments to
determine credit problems and loan policy violations that require the attention
of management. All of these factors are used to determine the adequacy of the
allowance for loan losses and adjust its balance accordingly.

The allowance for loan
losses is increased by the amount of the provision for loan losses and
recoveries of previously charged-off loans. It is decreased by loan charge-offs
as they occur when principal is deemed to be uncollectible.

---

The policy of the Company is to assess goodwill for impairment at the reporting unit level on an annual basis. Impairment is
the condition that exists when the carrying amount of goodwill exceeds its implied fair value. Accounting standards require
management to estimate the fair value of each reporting unit in making an annual assessment of impairment. Management
performs this assessment as of January 1 of each year.

Impairment of goodwill is recognized by a charge against earnings and is shown as a separate line item in the noninterest
expense section of the consolidated statement of income.

The estimate of fair value is dependent on such assumptions as: (1) future cash flows determined from the budget, strategic
plan, and forecasts of growth, and (2) discount rates and earnings multiples used to determine the present value of those
cash flows. Management uses a model similar to those used to evaluate potential mergers and acquisitions. Testing of the
goodwill asset in the first quarters of 2004 and 2005 resulted in no impairment charges.

Identifiable intangible assets are amortized over their estimated lives. Identifiable intangible assets that have indefinite
lives are not amortized until such time that their estimated lives are determinable. Intangible assets with indefinite lives
must be assessed for impairment annually.

Accounting standards require that a liability be recorded if management determines that it is probable that a loss has
occurred and the loss can be reasonably estimated. Management must estimate the probability of occurrence and estimate the
potential exposure of a variety of contingencies such as health claims, legal claims, tax liabilities and other potential
claims against the Company's assets or requirements to perform services in the future.

Management's estimates are based upon their judgment concerning future events and their potential exposures. However, there
can be no assurance that future events, such as changes in a regulator's position or court cases will not differ from
management's assessments. When management, based upon current facts and expert advice, believes that an event is probable and
reasonably estimable, it accrues a liability in the consolidated financial statements. That liability is adjusted as facts
and circumstances change and subsequent assessments produce a different estimate.

In March, 2004, The SEC issued Staff Accounting Bulletin No. 105 (SAB 105), "Application of Accounting Principles to Loan
Commitments." SAB 105 provides guidance for accounting related to loan commitments accounted for as derivative instruments.
Generally, interest-rate locks on loans that are to be held for sale are considered derivatives, and therefore accounted for
under the guidelines of Statement of Financial Accounting Standards (SFAS) No. 133 and subsequent amendments. As derivatives,
these commitments are required to be marked-to-market through the income statement for each reporting period. SAB 105
specifically prohibits the incorporation of the expected future cash flows related to servicing of the future loan to be
considered in the valuation of the rate-lock commitment. The adoption of this statement did not have a material effect on the
financial statements.

In March, 2004, the Financial Accounting Standards Board (FASB) approved certain additional provisions of EITF Issue No.
03-1, "The Meaning of Other-Than-Temporary Impairment and Its Applications to Certain Investments." These revisions require
disclosures for cost method investments similar to those previously presented in fiscal 2003 financial statements for
investments accounted for under SFAS No. 115. These revisions also clarify the appropriate timing and methodology for
evaluating whether an "other-than-temporary" impairment has occurred. The new impairment evaluation and recognition guidance
was originally effective for reporting periods beginning after June 15, 2004. An impairment is considered
"other-than-temporary" unless, (1) the investor has the ability and intent to hold an investment for a reasonable period of
time sufficient for an anticipated recovery of fair value up to or beyond the cost of the investment and (2) evidence
indicating that the cost of the investment is recoverable within a reasonable period of time outweighs evidence to the
contrary. An issue of great concern to financial institutions is the implication that impairments resulting from increases in
interest rates, sector spreads, or both may be required to be recognized if the impairment (or interest rate environment)
persists. The FASB issued an exposure draft of a proposed FASB Staff Position (FSP) in September, FSP EITF Issue 03-1-a to
address these concerns and clarify the effect on other temporarily impaired debt securities in a class of a decision to
dispose of a temporarily impaired debt security, thereby triggering an impairment charge. The comment period for this
exposure draft ended on October 29, 2004. The FASB is evaluating whether to move toward a final FSP or to address the issue
within a different framework. Once a final pronouncement is issued, the Company will evaluate the financial statement impact
of implementing the impairment provisions.

---

In October, 2003, the FASB approved the AICPA's issuance of SOP 03-3, "Accounting for Loans or Certain Debt Securities
Acquired in a Transfer", which modifies the accounting for certain loans that are acquired with evidence of deterioration in
credit quality since origination. SOP 03-3 does not allow the excess of contractual cash flows over cash flows expected to be
collected to be recognized as a yield adjustment, valuation allowance, or other loss accrual. Therefore, the yield that may
be accreted is limited to the excess of cash flows expected to be collected in excess of the acquirer's initial investment in
the loan or security. SOP 03-3 is effective for years beginning after December 15, 2004. This pronouncement was adopted on
January 1, 2005 and is being applied prospectively. The FDIC has also clarified that past due classifications are to be
determined with reference to the contractual cash flows of the loans rather than the expected cash flows used in recording
the transfer.

In December 2004, the FASB issued SFAS No. 123 (revised 2004), "Share-Based Payment" (SFAS 123R). SFAS 123R establishes
standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services. It
also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the
fair value of the entity's equity instruments or that may be settled by the issuance of these equity instruments. SFAS 123R
requires that the cost of share-based employee compensation be recognized as an expense over the period that the employee
earns the awards. The Company will use the "modified prospective" method of adopting the new standard. This method basically
requires that the grant date fair value of unearned share-based compensation must begin to be recognized, starting at the
adoption date and going forward. All new awards after the adoption date will be accounted for at fair value and recognized
over the periods that they are earned by the employees. The adoption date for the Company would be July 1, 2005 under SFAS
123R. In March, 2005 the SEC issued Staff Accounting Bulletin No. 107 (SAB 107) clarifying valuation and other issues related
to the implementation of SFAS 123R. In April, 2005 the SEC announced that it would allow companies to adopt SFAS 123R
starting with fiscal years beginning after June 15, 2005, thereby delaying the Company's adoption date to January 1, 2006.
The Company does not expect the adoption of SFAS 123R to have a material effect on its financial statements.

Market risk reflects the risk of economic loss resulting from changes in interest rates and market prices. This risk of loss
can be reflected in either reduced potential net interest income in future periods or diminished market values of financial
assets.

The Company's market risk arises primarily from interest rate risk, which the asset/liability management committee monitors
and manages on a monthly basis. The committee manages the interest rate risks inherent in the loan, investment, deposit and
borrowing portfolios of the institution. The asset/liability management committee determines the risk profile of the Company
and determines strategies to maintain interest rate sensitivity at a low level. As of March 31, 2005, the institution was in
a positive repricing gap position of approximately 22.89% of assets.

Interest rate shock analysis shows that the Company will experience a 12 basis point decrease over 12 months in its net
interest margin with an immediate and sustained 100 basis point decrease in interest rates. An immediate and sustained
increase in rates of 100 basis points will result in a 10 basis point increase in the net interest margin. Factors that
influence the simulation results are (1) the assumption that floating-rate loans adjust approximately simultaneously with
changes in general interest rates, (2) the assumption that core deposits such as NOW and MMDA accounts will have average
lives much longer than their repricing periods, (3) that noninterest-bearing deposits are a stable, long-term source of
funds, and (4) the durations of mortgage-backed securities will extend during periods of rising rates and shorten during
periods of falling rates.

An analysis of the change in market value of equity shows how an interest rate shock will affect the difference between the
market value of assets and the market value of liabilities. With all financial instruments being stated at market value, the
market value of equity will increase by .26% with an immediate and sustained decrease in interest rates of 100 basis points.
The market value of equity will decrease by 2.42% with an immediate and sustained increase in interest rates of 100 basis
points.

The Company had no hedging instruments or other derivative contracts in place at March 31, 2005.

---

As defined by the
Securities and Exchange Commission in Exchange Act Rule 13a-15(e), a
companys disclosure controls and procedures means controls and
other procedures of an issuer that are designed to ensure that information
required to be disclosed by the issuer in the reports that it files or submits
under the Exchange Act is recorded, processed, summarized and reported, within
the time periods specified in the Commissions rules and forms.

As of March 31, 2005 (the
Evaluation Date), the Companys Chief Executive Officer and
Chief Financial Officer have evaluated the effectiveness of the Companys
disclosure controls and procedures as defined in the Exchange Act Rules. Based
on their evaluation, the Companys Chief Executive Officer and Chief
Financial Officer have concluded that the Companys disclosure controls and
procedures are sufficiently effective to ensure that material information
relating to the Company and required to be disclosed by the Company in the
reports that it files or submits under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in the
Commissions rules and forms.  There has been no change in the Company's
internal control over financial reporting during the quarter ended March 31, 2005
that has materially affected, or is reasonably likely to materially affect, the
Company's internal control over financial reporting.

The Company and its
subsidiaries are defendants in certain cases alleging that loans were originated
or renewed in a way that the borrowers were improperly sold insurance products,
such as credit life insurance. The Company denies these allegations and is
defending these claims. The Company is also involved in various other lawsuits
arising out of the normal course of business. The Company accrues for any
probable losses expected to be incurred due to litigation. In the opinion of
management, the ultimate resolution of these claims should not have a material
adverse effect on the Companys consolidated financial position or results
of operations.

---

The following table
summarizes repurchases of common stock for the program in place during the first
quarter of 2005:

`Maximum Number
                                                                                        Total Number             (or Approximate
                                                                                          of Shares               Dollar Value)
                                                                                    (or Units) Purchased      of Shares (or Units)
                                      Total Number                                        As Part of              That May Yet Be
                                     of Shares (or          Average Price Paid        Publicly Announced        Purchased Under the
          Period                    units) Purchased       Per Share (or Unit)         Plans or Programs         Plans or Programs
          ------                    ----------------       -------------------         -----------------         -----------------
01/01/05 - 01/31/05 (1)                       5,000                  $ 34.06                      5,000                    30,000
02/01/05 - 02/28/05                           5,000                    34.40                      5,000                    20,000
03/01/05 - 03/31/05                               -                        -                          -                    10,000

(1)      On April 14, 2004, the Board authorized a program to repurchase up to 120,000 shares of common stock in the open
         market over a twelve month period beginning on May 1, 2004 and ending on April 30, 2005. The authorization limits
         the number of shares that may be repurchased in any calendar month to no more than 10,000.`

`Exhibit 3(A) - Articles of Incorporation, as amended. Filed as Exhibit 3 to the Company's Form S-1 (File No. 33-08751)
     September 15, 1986, incorporated herein by reference.

     Exhibit 3(B) - By-Laws, as amended. Filed as Exhibit 3-b to the Company's Form S-1 (File No. 33-08751) September 15,
     1986, incorporated herein by reference.

     Exhibit 11 - Computation of Earnings Per Share - See note 4 to the consolidated financial statements included in this report.

     Exhibit 31 - Rule 13a-14(a)/15d-14(a) Certifications.

     Exhibit 32 - Section 1350 Certifications.`

---

`FIRST M & F CORPORATION


SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized.


FIRST M & F CORPORATION


Date: May 10, 2005


BY:  /s/ Hugh S. Potts, Jr.                                              BY: /s/ John G. Copeland
     -----------------------------------------------------                  ----------------------------------------------
         Hugh S. Potts, Jr.                                                   John G. Copeland
         Chairman of the Board and                                            Executive Vice President and
         Chief Executive Officer                                              Chief Financial Officer`

---

`FIRST M & F CORPORATION


EXHIBIT INDEX


3 (A)   Articles of Incorporation, as amended. Filed as Exhibit 3 to the Company's Form S-1 (File No. 33-08751) September 15,
        1986, incorporated herein by reference.

3 (B)   Bylaws, as amended. Filed as Exhibit 3-b to the Company's Form S-1 (File No. 33-08751) September 15, 1986,
        incorporated herein by reference.

11      Computation of Earnings Per Share - Filed herewith as note 4 to the consolidated financial statements.

31      Rule 13a-14(a) Certification of Hugh S. Potts, Jr., Chief Executive Officer and Rule 13a-14(a) Certification of John G.
        Copeland, Chief Financial Officer

32      Section 1350 Certification of Hugh S. Potts, Jr., Chief Executive Officer and Section 1350 Certification of John G.
        Copeland, Chief Financial Officer`

---