SECURITY AND EXCHANGE COMMISSION
	WASHINGTON, D. C. 20549

	FORM 10-Q

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




For quarter ended   March 31, 2001   Commission file number   2-71249

                         SOUTH BANKING COMPANY
	(Exact name of registrant as specified in its charter)


              Georgia                         58-1418696
(State or other jurisdiction of (I.R.S. Employer Identification Number)
 incorporation or organization)


 104 North Dixon Street, Alma, Georgia                 31510
(Address of principal executive offices)             (Zip Code)


Registrant's telephone number, including area code   (912) 632-8631

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 to be filed by Sections 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such report(s), and (2) has
been subject to such filing requirement for the past 90 days.


                                             Yes    X        No

Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of March 31, 2001.


    Common stock, $1.00 par value - 399,500  shares outstanding

	SOUTH BANKING COMPANY

	SOUTH BANKING COMPANY
	ALMA,      GEORGIA

Part I.  Financial Information

         Consolidated Financial Statements . . . . . . . . . . . 4 -  9

         Notes to Consolidated Financial Statements . . . . . . 10 - 11

         Management's Discussion and Analysis of Financial
          Condition and Results of Operations . . . . . . . . . 12 - 18


Part II. Other Information  . . . . . . . . . . . . . . . . . .      19

SOUTH BANKING COMPANY
	ALMA,     GEORGIA
	CONSOLIDATED BALANCE SHEETS
	(UNAUDITED)

	March 31,    	December 31,
	2001         	   2000

	ASSETS

Cash and due from banks	$ 12,034,410	$  8,911,914

Deposits in other banks -
 interest bearing	$    773,000	$    825,279

Investment securities:
 Available for sale	$ 19,019,093	$ 20,695,055

 Held to maturity 	$    147,379	$    147,326

Georgia Bankers stock	$    547,283	$    547,283

Federal Home Loan Bank stock	$    426,100	$    426,100

Federal funds sold	$ 21,463,000	$ 14,693,000

Loans 	$168,118,807	$163,227,679
Less: Unearned discount	(   252,930	)	(   253,273	)
Reserve for loan losses 	 ( 2,836,916)	 ( 2,728,219)

	$165,028,961	$160,246,187

Bank premises and equipment	$  6,088,486	$  6,111,361

Goodwill	$  1,857,412	$  1,916,358

Other assets	$  5,470,983	$  5,930,175


Total Assets	$232,856,107	$220,450,038

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

  4

SOUTH BANKING COMPANY
	ALMA,     GEORGIA
	CONSOLIDATED BALANCE SHEETS (Con't)
	(UNAUDITED)

	March 31,    	December 31,
	2001         	2000

	LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities
Deposits:  Demand - non-interest
                     bearing	$ 28,863,821	$ 24,298,756
           Demand - interest bearing	28,810,358	27,404,525
           Savings	12,434,041	11,326,824
           Time	 133,694,960	 129,649,110

	$203,803,180	$192,679,215
Borrowing	6,196,979	6,223,363
Accrued expenses and other
 liabilities	2,734,096	2,236,900
Federal funds purchased	-	-
Note payable - Federal Home Loan Bank	  1,026,667	   1,040,000

Total Liabilities	$213,760,922	$202,179,478

Stockholders' Equity
Common stock $1 par value; shares
 authorized - 1,000,000,  shares
 issued and outstanding at
 March 31, 2001 and December 31,
 2000 - 399,500 and 399,500,
 respectively	$    399,500	$    399,500
Surplus	3,070,831	3,070,831
Undivided profits	15,561,692	14,887,046
Accumulated other comprehensive
 income	      63,162		  (   86,817)

Total Stockholders' Equity	$ 19,095,185	$ 18,270,560

Total Liabilities and
 Stockholders' Equity	$232,856,107	$220,450,038

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

                                    5
	SOUTH BANKING COMPANY
	ALMA,     GEORGIA
	CONSOLIDATED STATEMENT OF INCOME AND
	 COMPREHENSIVE INCOME
	(UNAUDITED)

	 Three Months	Three Months
	Ended        	 Ended
	March 31,    	March 31,
	2001         	2000
Interest Income
Interest and fees on loans	$  4,461,307	$  3,768,790
Interest on federal funds sold	286,670	107,037
Interest on deposits with other
 banks	11,039	10,733
Interest on investment securities:
 U. S. Treasury	7,695	24,372
 U. S. government agencies	265,140	217,368
 Mortgage backed securities	5,534	8,349
 State and political subdivisions	18,819	20,852
 Dividends	     20,228	      21,007

Total Interest Income	$ 5,076,432	$  4,178,508


Interest Expense
Interest on deposits	$ 2,529,460	$  1,701,257
Interest on other borrowings	    138,773	      59,834

Total Interest Expense	$  2,668,233	$  1,761,091

Net Interest Income	$  2,408,199	$  2,417,417
Provision for loan losses	     141,500	      87,500

Net interest income after provisions
 for loan losses	$  2,266,699	$  2,329,917


Other Operating Income
Service charge on deposit accounts	$    410,320	$    354,223
Commission on insurance	23,214	28,139
Other income	361,989	179,114
Gain (loss) sale of securities	-	-
Computer income	     134,706	     112,345

Total Other Operating Income	$    930,229	$    673,821

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

                                    6
	SOUTH BANKING COMPANY
	ALMA,     GEORGIA
	CONSOLIDATED STATEMENT OF INCOME AND
	COMPREHENSIVE INCOME (Con't)
	(UNAUDITED)

	Three Months	Three Months
	Ended        	 Ended
	March 31,    	March 31,
	2001         	2000
Other Operating Expenses
Salaries	$    944,876	$    795,413
Profit sharing and other personnel
 expense	179,117	159,088
Occupancy expense	129,016 	98,132
Furniture and fixtures expense	260,753	181,554
Payroll taxes	62,006	50,945
Data processing	72,796	44,546
Other operating expenses	     532,043	     466,964

Total Other Operating Expenses	$  2,180,607	$  1,796,642

Income before income taxes	$  1,016,321	$  1,207,096
Applicable income taxes	     341,674	     403,209

Net income	$    674,647	$    803,887
Other comprehensive income, net of tax
 Unrealized gains (losses) on
  securities	$    149,979		$(   112,425	)

Other comprehensive income (loss)	$    149,979	$(   112,425)

Comprehensive income	$    824,626	$    691,462


Per share data on weighted average
 outstanding shares
Weighted average outstanding shares	$    399,500	     399,500

Net income per share	$      1.689	$      2.012

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

                                   7
	SOUTH BANKING COMPANY
	ALMA,     GEORGIA
	STATEMENT OF CASH FLOWS
	(UNAUDITED)


	Three Months	Three Months
	Ended        	 Ended
	March 31,    	March 31,
	2001         	2000
Cash Flows From Operating Activities:
 Net income	$    674,647	$    803,887
 Add expenses not requiring cash:
  Provision for depreciation and
   amortization	281,660	167,906
  Provision for loan losses	141,500	87,500
 Bond portfolio losses (gains)	-	-
 Gain on sale of other real estate
  owned	-	-
 Increase (decrease) in taxes payable  	 380,666 	345,770
 Increase (decrease) in interest payable  	284,515	118,689
 Increase (decrease) in other liabilities  (  167,985	)	180,249
 (Increase) decrease in interest
  receivable	196,874		(   123,101	)
 (Increase) decrease in prepaid
  expenses	(   45,343	)	(    40,894	)
 (Increase) decrease in other assets          220,526	   (  221,127)
 Recognition of unearned loan income	          -	        9,000

Net Cash Provided (Used) by Operating
 Activities	$ 1,967,060	$  1,327,879

Cash Flows From Investing Activities:
 Proceeds from maturities of investment
  securities - available for sale	$ 6,664,682	$     10,452
 Proceeds from maturities of investment
  security - held to maturity	-	-
 Purchase of investment securities - AFS	( 4,750,000	)	-
 Purchase of investment securities - HTM	-		-
 Net loans to customers	( 4,924,274	)	( 8,827,480	)
 Purchase of premise and equipment	(   201,499	)	(   326,230	)
 Proceeds from sale of equipment	         -	 -
 Proceeds from other real estate owned	-	-
 Purchase of FHLB stock	          -		           -

Net Cash Provided (Used) by Investing
 Activities	$( 3,211,091)	$( 9,143,258)


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

                                    8
    SOUTH BANKING COMPANY
ALMA,     GEORGIA
STATEMENT OF CASH FLOWS (Con't)
(UNAUDITED)


	         Three Months 	Three Months
 	Ended        	 Ended
	March 31,    	March 31,
	2001         	2000

Cash Flows From Financing Activities:
 Net increase (decrease) in demand
  deposits, NOW and money market	$  5,970,898	$  2,669,568
 Net increase (decrease) in savings
  and time deposit	5,153,067	5,449,452
 Net increase (decrease) in borrowings	(    26,384)(   177,531	)
 Dividends paid	-	-
 Redemptions of company stock	-	-
 Federal funds purchased	-	(   450,000)
 Net decrease - note payable - FHLB	(    13,333) (    13,333)

Net Cash Provided (Used) by
 Financing Activities	$ 11,084,248		$  7,478,156

Net Increase (Decrease) in Cash
 and Cash Equivalents	$  9,840,217		$(   337,223)

Cash and Cash Equivalents at
 Beginning of Year	  24,430,193	  15,744,998

Cash and Cash Equivalents at
 End of Period	$ 34,270,410	$ 15,407,775

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

                                    9
	SOUTH BANKING COMPANY
	ALMA,     GEORGIA
	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Basis of Presentation

	The accounting and financial reporting policies of South Banking
Company and its subsidiaries conform to generally accepted accounting
principles and to general practice within the banking industry.  The
consolidated statements include the accounts of South Banking Company
and its wholly owned subsidiaries.  All material intercompany accounts
and transactions have been eliminated in consolidation.  The
accompanying interim financial statements are unaudited.  In
management's opinion, the consolidated financial statements reflect a
fair presentation of the consolidated financial position of South
Banking Company and subsidiaries, and the results of its operations
and its cash flows for the interim periods presented, in conformity
with generally accepted accounting principles.  These interim financial
statements should be read in conjunction with the audited financial
statements and footnote disclosures in the Bank's 10K for the fiscal
year ended December 31, 2000.

      Basic earnings per share have been computed by dividing net
income (the numerator) by the weighted average number of common shares
(the denominator) for the period.

	In June 1997, the FASB issued SFAS No. 131, "Disclosures about
Segments of an Enterprise and Related Information."  SFAS No. 131
requires that public companies report certain information about
operating segments in complete sets of financial statements of the
company and in condensed financial statements of interim periods issued
to shareholders.  It also requires that public companies report certain
information about their products and services, the geographic areas in
which they operate, and their major customers.  SFAS No. 131 applies to
fiscal years beginning after December 15, 1997.  South Banking Company
is a four bank holding company operating primarily in Southeast Georgia.
The primary purpose of the company is the delivery of financial services
within its market.  Each of the company's entities are part of the same
reporting segment, whose operating results are regularly reviewed by
management.  Therefore, consolidated financial statements, as presented,
fairly reflect the operating results of the financial services segment
of our business.

     In June 1997, FASB issued SFAS No. 130, "Reporting Comprehensive
Income" ("SFAS 130").  SFAS 130 established standards for reporting and
display of comprehensive income and its components in the financial
statements.  SFAS 130 applies to fiscal years beginning after December
15, 1997. Reclassification of financial statements for earlier periods
has been provided for comparative purposes.

                              10
SOUTH BANKING COMPANY
ALMA, GEORGIA
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

	During 1998, the FASB issued SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities" ("SFAS 133"), which
establishes accounting and reporting standards for derivative instruments
and for hedging activities.  The statement requires that all derivatives
be recognized as either assets or liabilities in the statement of financial
position and be measured at fair value.  SFAS 133 is effective for fiscal
quarters of all fiscal years beginning after June 15, 1999; earlier
application is permitted. The company does not hold or issue derivative
instruments as defined by SFAS 133; and accordingly, it is the opinion of
management that there will be no future impact from this recent accounting
standard.


                                 11

SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Liquidity and Capital Resources

     Liquidity management involves the matching of the cash flow
requirements of customers, who may be either depositors desiring to
withdraw funds or borrowers needing assurance that sufficient funds will
be available to meet their credit needs and the ability of South Banking
Company and its subsidiaries (the "Company") to meet those needs.  The
Company strives to maintain an adequate liquidity position by managing
the balances and maturities of interest-earning assets and interest-
bearing liabilities so that the balance it has in short-term investments
(Federal funds sold) at any given time will adequately cover any
reasonably anticipated immediate need for funds.  Additionally, the
subsidiary banks (the "Banks") maintain relationships with correspondent
banks, which could provide funds to them on short notice, if needed.

	The liquidity and capital resources of the Company are monitored
on a periodic basis by state and federal regulatory authorities.  As
determined under guidelines established by these regulatory authorities,
the Banks' liquidity ratios at March 31, 2001 were considered
satisfactory.  At that date, the Banks' Federal funds sold were adequate
to cover any reasonably anticipated immediate need for funds.  The
Company is aware of no events or trends likely to result in a material
change in liquidity. At March 31, 2001, the Company's and the Banks'
capital asset ratios were considered well capitalized based on
guidelines established by regulatory authorities.  During the three
months ended March 31, 2001, total capital increased $824,625 to
$19,095,185.  This increase in capital resulted from net earnings of
$674,647 and an increase of $149,978 in unrealized losses on securities
available for sale, net of taxes.

	At March 31, 2001, South Banking Company had one binding commitment
 for capital expenditures. South Banking Company's subsidiary, Alma
Exchange Bank, had entered into an agreement to remodel its main bank
building.  Alma Exchange Bank has estimated the final cost to approximate
$2,000,000.

Results of Operations

	The following discussion and analysis presents the significant
changes in financial condition and the results of operations of South
Banking Company and Subsidiaries for the periods indicated.  This
discussion and analysis should be read in conjunction with the Company's
2000 Form 10-K.

   12
SOUTH BANKING COMPANY
	ALMA,     GEORGIA
	MANAGEMENT'S DISCUSSION AND ANALYSIS OF
	FINANCIAL CONDITION AND RESULTS OF OPERATIONS


Results of Operations (Con't)

	Since the primary business activities of South Banking Company
are conducted through its Banks, this discussion focuses primarily on
the financial condition and operations of the Banks.  Included in this
discussion are forward looking statements based on management's current
expectations, actual results, however, may differ.  Amounts and
percentages used in this discussion have been rounded. The acquisition
of the three branches by subsidiary, Pineland State Bank, in July of
2000 has an impact on these comparisons and all comments below should be
read taking the acquisition in effect.

Earnings Summary

	Net income for the first quarter of 2001 was $674,647, down
$129,240 from $803,887 in the first quarter of 2000.  On a per share
basis earnings registered a similar decrease from $2.01 to $1.69.
These levels of income represent annualized returns on average assets of
1.19% and 1.80%, respectively.  Return on average equity also decreased
from 19.90% to 14.44%.  Details concerning the Company's results of
operations are discussed in the following sections of this report.

	Net interest income for the first quarter of 2001 totaled
$2,408,199, down $9,218 from $2,417,417 in the first quarter of 2000.
Interest income is being impacted by the mix of assets, the level of
earning assets and the interest rate environment.  Average earning assets
for the quarter of $202.5 million are $42.1 million in excess of the
first quarter 2000 average.  These funds have primarily been invested in
the loan portfolio until this quarter when loan demand weakened.  The
rate environment and loan volume has caused loan income to increase
$692,517 from $3,768,790 in the first quarter of 2000 to $4,461,307 in
the first quarter of 2001.  This increase reflects the volitile repricing
of the Bank's substantial portfolio of one-year adjustable rate loans;
however, the recent decrease in the prime rate has begun to negatively
impact interest income.

	Interest expense, the other component of net interest income,
increased $907,142 when compared to the first quarter of last year
including the fact that the average balance of interest bearing
liabilities was up $44.9 million.  The overall cost of interest bearing
liabilities for the quarter of 5.19% is 15 basis points higher than in
the first quarter of 2000, reflecting several rate changes implemented
in 2000 that increased rates before rate changes in early 2001 began to
lower rates.  Many of the higher rates have not matured and overall rates
have remained high.

	This combination of higher average balances and higher rates
produced a net interest margin of 4.83% for the quarter, down from 5.37%
in the first quarter of last year.

  13
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS


Earnings Summary (Con't)

	The provision for loan losses is a charge to earnings in the
current period to replenish the allowance for loan losses and maintain
it at the level management determines is adequate.  The provision for
loan losses charged to earnings amounted to $141,500 and $87,500 during
the three months ended March 31, 2001 and 2000, respectively.

Noninterest Income

	Following is a comparison of noninterest income for the three
months ended March 31, 2001 and 2000.

                              Three       Three
                              Months    	Months
     	                	      Ended      	Ended
     	   	                  March 31,  	March 31,
		                  2001  	2000
Service charges on deposits	$  410,320	$  354,223
Other service charges, commissions
 & fees	23,214	28,137
Other income	   496,695	   291,461

Total Noninterest Income	$  930,229	$  673,821


	Total noninterest income for the three months ended March 31,
2001 was $256,408 higher than during the same period in 2000.  The
primary increase is related to additional computer processing income
from nonaffiliated banks and brokerage services and gain from loan
sale.

	During the third quarter of 1998, the Bank began offering
brokerage services, including stocks, bonds, mutual funds and
annuities, to its customers.  The effect on the deposit base has been
limited as less than one quarter of the total sales have come from
Bank deposits.  In the long-term, management believes this service
could actually increase deposits.

Noninterest Expense

	Noninterest expense includes all items of expense other than
interest expense, the provision for loan losses, and income taxes.
Total noninterest expense for the first quarter of 2001 of $2,180,607
was $383,965, or 21.37% greater than during the first quarter of 2000.

  14
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Noninterest Expense (Con't)

	The majority of this increase was due to the addition of the
three branches purchased by Pineland State Bank and includes all areas
of expenses.  Salaries have increased as a result of the normal growth
in assets and normal salary increases. Increases were also experienced
in group insurance and pension expense.

	Other non-personnel expense had little change from prior year
except for new branch costs.  Management expects this trend to remain
constant during the remainder of the year.

Income Taxes

	The Company's provision for income taxes, which totaled $341,674
in the first quarter of 2001 and $403,209 in the first quarter of 2000,
includes both federal and state income taxes.  The effective tax rates
during the two periods were 33.6% in 2001 and 33.4% in 2000.

Financial Condition

	Average total assets during the first quarter of 2001 were
$226,653,073, up from $178,392,115 from the first quarter of 2000.  A
detailed discussion of the Bank's financial condition, and its various
balance sheet components follows:

Loan Portfolio

	The loan portfolio, which represents South's largest asset, has
increased during the first quarter by $4,891,128 to $168,118,807.
Competitive pressures from auto manufacturers and a variety of mortgage
providers continue to make loan growth at acceptable yields and risk
levels difficult for those types of loans.  Management also believes
that with the recent decline in the local farming economy, there exists
little opportunity to expand and develop the agricultural loan
portfolio. In the year since March 31, 2000, the loan portfolio has
increased substantially. Commercial and real estate lending remains the
largest part of the portfolio and where the growth is derived.

The Bank is also a party to financial instruments with off-balance sheet
risk in the normal course of business to meet the financing needs of its
customers.  These financial instruments include commitments to extend
credit and letters of credit.  Those instruments involve, to varying
degrees, elements of credit and interest rate risk in excess of the
amount recognized in the consolidated balance sheets.  At March 31,
2001, commitments to extend credit, including unused lines of credit,
totaled $26,564,000 while letters of credit totaled $344,000.

  15
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Loan Portfolio (Con't)

	Company policy requires those loans which are past due 90 days
or more be placed on nonaccrual status unless they are both well
secured and in the process of collection.  The following table provides
a summary of past due loans and nonperforming assets.

Summary of Past Due Loans and Nonperforming Assets
(in thousands)

                                                 -------March 31-------
		2001   	2000
                                                      (Unaudited)
	Loans past due 90 or more days
      still accruing interest	$   371	$   155

	Nonperforming assets:
	 Nonaccruing loans	$ 1,602	$   843
	 Other real estate owned	    575	    700

		$ 2,177	$ 1,543


	Management makes this determination by its analysis of overall
loan quality, changes in the mix and size of the loan portfolio,
previous loss experience, general economic conditions, information about
specific borrowers, and other factors.  At March 31, 2001, the allowance
for loan losses was $2,836,916 or 1.68% of gross loans. Given the
inherent risk contained in the portfolio, including the nonaccrual loan
described above as well as commitments to extend credit, this level is
considered adequate.  Management is not aware of any trends,
uncertainties or other information relating to the loan portfolio, which
it expects will materially impact future operating results, liquidity,
or capital resources.

	The provision for loan losses is a charge to earnings which is
made to maintain the allowance for loan losses at a significant level.
The provision totaled $141,500 during the first quarter of 2001 and
$87,500 during the first quarter of 2000.

Securities Portfolio and Federal Funds Sold

	The Bank's securities portfolio consists of available for sale
and held to maturity securities while no securities are maintained in
a trading account.  At March 31, 2001, the held to maturity portfolio
totaled $147,379.

  16
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS


Securities Portfolio and Federal Funds Sold (Con't)

	Management attempts to emphasize the available for sale
port-folio due to the flexibility it allows in managing the balance
sheet structure and addressing asset/liability issues. At March 31,
2001, this portfolio had an estimated fair value of $19,019,093,
$97,925 more than the amortized cost.  Such excess represents an
unrealized gain.

	This portfolio is invested primarily in U.S. Treasury and agency
obligations and tax exempt municipals.  The treasury and agency portion
of the portfolio, including agency backed mortgage securities, total
$17,120,917 at quarter end or 89.3% of the available for sale portfolio.
Tax exempt municipals totaling $1,539,426 comprised 8.0%. The remainder
of the portfolio, which totals $506,128, consists of bank holding
company stock.

	The Bank has typically favored investments with maturities of five
years or less which have known cash flow patterns.  Such instruments
typically provide greater safety, less market value fluctuation and more
simplified asset/liability issues.  However, some callable securities
and mortgage backed securities may be purchased from time to time for
their increased yield.

	The Bank generally tries to minimize its involvement in the
overnight federal funds sold market, instead relying on the continually
maturing securities portfolio to provide the liquidity needed to fund
loans or meet deposit withdraw demands.  Nonetheless, at any given time,
the execution of specific investing or funding strategies or normal
fluctuations in deposit and loan balances may require the bank to sell,
or buy, funds on an overnight basis.  In addition, any daily excess
funds are maintained in Federal Funds until demands on accounts are
determined.

Deposits and Other Funding Sources

	Total deposits at March 31, 2001 of $203,803,180 were up from
their year end total of $192,679,215.  The first quarter has
traditionally been a slow growth period.  First quarter deposits have
increased $11,123,965.

	Noninterest bearing deposits increased $4,565,065 to $28,863,821
during the quarter.  In contrast to this, interest bearing deposits
increased $6,558,900 or 3.4%, to $174,939,359 during the quarter.
Increases were experienced in all types of interest bearing deposits.

  17
SOUTH BANKING COMPANY
ALMA, GEORGIA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Deposits and Other Funding Sources (Con't)

	In addition to deposits the Bank may generate funding by the use
 of borrowings.

Impact of Inflation

     The consolidated financial statements and related data included
in this report were prepared in accordance with generally accepted
accounting principles, which require the Company's financial position
and results of operations to be measured in terms of historical dollars,
except for the available for sale securities portfolio. Consequently,
the relative value of money generally is not considered. Nearly all of
the Company's assets and liabilities are monetary in nature and, as a
result, interest rates and competition in the market area tend to have
a more significant impact on the Company's performance than the effect
of inflation.


  18
	SOUTH BANKING COMPANY
	ALMA,     GEORGIA
	PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings - None

Item 6.  Exhibits and Reports on Form 8-K

         (A)  Exhibits

         (27) Financial Data Schedule

         The registrant has not filed any reports on Form 8-K during the
         three month period ended March 31, 2001.

19

SIGNATURES



     Pursuant to the requirements 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.


                                  SOUTH BANKING COMPANY
                                  (Registrant)



Date:  May 1, 2001               By:
                                     Paul Bennett
                                     President


Date:  May 1, 2001               By:
                                     Olivia Bennett
                                     Vice President