##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

|                   |                                                         |                                                         
|------------------ | ------------------------------------------------------- | --------------------------------------------------------
|(Mark one)         |                                                        
|(BOX WITH AN X)    | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|                   | SECURITIES EXCHANGE ACT OF 1934                        
|                  
|                  
|                  
|                  
|                   |                                                         | For the quarterly period ended March 31, 2001           
|                  
|                  
|                  
|                  
|(EMPTY BALLOT BOX) |                                                         | 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 0-27652

REPUBLIC BANCSHARES, INC.
(Exact Name of Registrant As Specified In Its Charter)

|                                        |  |                    
|--------------------------------------- |  | -------------------
|FLORIDA                                 |  | 59-3347653         
|                                       
|                                       
|                                       
|                                       
|(State or other jurisdiction of         |  | (IRS Employer      
|                                       
|                                       
|                                       
|                                       
|incorporation or organization)          |  | Identification No.)
|                                       
|                                       
|                                       
|                                       
|111 2nd Avenue N.E., St. Petersburg, FL |  | 33701              
|                                       
|                                       
|                                       
|                                       
|(Address of Principal Office)           |  | (Zip Code)         

(727) 823-7300
(Registrants Telephone Number, Including Area Code)

N/A

---

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes (EMPTY BALLOT BOX) No (EMPTY BALLOT BOX)

APPLICABLE ONLY TO CORPORATE ISSUERS

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

|                                       |  |                                                
|-------------------------------------- |  | -----------------------------------------------
|Common stock par value $2.00 per share |  | 10,561,589 shares outstanding at April 30, 2001





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TABLE OF CONTENTS



|                                                                                              |                                                                                                                                  |  |  |  |  |  |  | 
|--------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|Part I. FINANCIAL INFORMATION                                                                
|Item 1. Financial Statements                                                                 
|                                                                                              | Consolidated Balance Sheets - March 31, 2001 (unaudited) and December 31, 2000                                                  
|                                                                                              | Consolidated Statements of Operations - Three months ended March 31, 2001 and 2000 (unaudited)                                  
|                                                                                              | Consolidated Statements of Stockholders' Equity - Year ended December 31, 2000 and Three months ended March 31, 2001 (unaudited)
|                                                                                              | Consolidated Statements of Comprehensive Income - Three months ended March 31, 2001 and 2000 (unaudited)                        
|                                                                                              | Consolidated Statements of Cash Flows - Three months ended March 31, 2001 and 2000 (unaudited)                                  
|                                                                                              | Notes to Consolidated Financial Statements (unaudited)                                                                          
|                                                                                              | Selected Quarterly Financial and Other Data (unaudited)                                                                         
|Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
|Part II. Other Information                                                                   
|Item 1. Legal Proceedings                                                                    
|Item 5. Other Information                                                                    
|SIGNATURES                                                                                   



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##### Table of Contents



REPUBLIC BANCSHARES, INC.

INDEX



|                              |  |                                                                                                                                  |  |      |    | 
|----------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------- |  | ---- | -- | 
|                              |  |                                                                                                                                  |  | Page
|                              |  |                                                                                                                                  |  |     
|Part I. FINANCIAL INFORMATION |  |                                                                                                                                  |  |     
|Item 1. Financial Statements  |  |                                                                                                                                 
|                             
|                             
|                             
|                             
|                              |  | Consolidated Balance Sheets  March 31, 2001 (unaudited)
and December 31, 2000                                                   |  |      | 2  | 
|                             
|                             
|                             
|                             
|                              |  | Consolidated Statements of Operations -
Three months ended March 31, 2001 and 2000 (unaudited)                                   |  |      | 3  | 
|                             
|                             
|                             
|                             
|                              |  | Consolidated Statements of Stockholders Equity -
Year ended December 31, 2000 and
Three months ended March 31, 2001 (unaudited) |  |      | 4  | 
|                             
|                             
|                             
|                             
|                              |  | Consolidated Statements of Comprehensive Income -
Three months ended March 31, 2001 and 2000 (unaudited)                         |  |      | 4  | 
|                             
|                             
|                             
|                             
|                              |  | Consolidated Statements of Cash Flows -
Three months ended March 31, 2001 and 2000 (unaudited)                                   |  |      | 5  | 
|                             
|                             
|                             
|                             
|                              |  | Notes to Consolidated Financial Statements (unaudited)                                                                           |  |      | 6  | 
|                             
|                             
|                             
|                             
|                              |  | Selected Quarterly Financial and Other Data (unaudited)                                                                          |  |      | 13 | 
|                             
|                             
|                             
|                             
|Item 2.                       |  | Managements Discussion and Analysis of Financial Condition
and Results of Operations                                            |  |      | 16 | 
|                             
|                             
|                             
|                             
|Part II                       |  | OTHER INFORMATION                                                                                                               
|                             
|                             
|                             
|                             
|Item 1.                       |  | Legal Proceedings                                                                                                                |  |      | 20 | 
|                             
|                             
|                             
|                             
|Item 5.                       |  | Other Information                                                                                                                |  |      | 20 | 
|                             
|                             
|                             
|                             
|SIGNATURES                    |  |                                                                                                                                  |  |      | 21 | 





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##### Table of Contents



Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Certain statements contained in this Quarterly Report on Form 10-Q (other than
the financial statements and statements of historical fact), including,
without limitation, statements as to our expectations and beliefs presented
under the caption, Managements Discussion and Analysis of Financial
Condition and Results of Operations, may constitute forward-looking
statements. Forward-looking statements are made based upon our expectations
and beliefs concerning events, many of which, by their nature are inherently
uncertain and outside of our control. It is possible that our actual results
and financial condition may differ, possibly materially, from the anticipated
results and financial condition indicated in these forward-looking statements.

We wish to caution readers that the assumptions which form the basis for
forward-looking statements with respect to or that may impact earnings for the
year ending December 31, 2001, and thereafter include many factors that are
beyond our ability to control or estimate precisely. Some factors include the
market demand and acceptance of our existing and new loan and deposit
products, the impact of competitive products, and changes in economic
conditions, such as inflation or fluctuations in interest rates.

While we periodically reassess material trends and uncertainties affecting our
results of operations and financial condition in connection with our
preparation of the managements discussion and analysis contained in our
quarterly report, we do not intend to review or revise any particular
forward-looking statement referenced herein in light of future events.

1



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##### Table of Contents





















REPUBLIC BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS  MARCH 31, 2001 AND DECEMBER 31, 2000
($ in thousands, except share data)

|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |           |           |           |  |  |  |  | 
|---------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ----------------- | --------- | ----------- | --------- | ------------ | --------- | --------- | --------- |  |  |  |  | 
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           | March 31,   |           | December 31,
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           | 2001        |           | 2000        
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |             
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           | (unaudited)
|ASSETS                                                                                                                                        
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Cash and due from banks                                                                                                                        |                                                                                                                                                                                                   | $                                          | 52,533            |           |             | $         | 52,540       |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Interest bearing deposits in banks                                                                                                             |                                                                                                                                                                                                   |                                            | 6,462             |           |             |           | 6,910        |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Federal funds sold                                                                                                                             |                                                                                                                                                                                                   |                                            | 203,891           |           |             |           | 150,212      |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Investment securities  available for sale                                                                                                     |                                                                                                                                                                                                   |                                            | 8,713             |           |             |           | 18,787       |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Mortgage-backed and mortgage-related securities:                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Held to maturity                                                                                                                                                                                  |                                            |                   | 31,408    |             |           |              | 33,844    |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Available for sale                                                                                                                                                                                |                                            |                   | 381,534   |             |           |              | 329,748   |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Trading                                                                                                                                                                                           |                                            |                   | 47,905    |             |           |              | 24,578    |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|FHLB stock                                                                                                                                     |                                                                                                                                                                                                   |                                            | 13,816            |           |             |           | 13,816       |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Loans, net of allowance for loan losses                                                                                                        |                                                                                                                                                                                                   |                                            | 1,623,426         |           |             |           | 1,677,880    |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Premises and equipment, net                                                                                                                    |                                                                                                                                                                                                   |                                            | 46,347            |           |             |           | 47,223       |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Other real estate owned acquired through foreclosure, net                                                                                      |                                                                                                                                                                                                   |                                            | 4,496             |           |             |           | 5,729        |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Accrued interest receivable                                                                                                                    |                                                                                                                                                                                                   |                                            | 12,219            |           |             |           | 13,950       |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Goodwill and premium on deposits                                                                                                               |                                                                                                                                                                                                   |                                            | 28,004            |           |             |           | 28,969       |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Other assets                                                                                                                                   |                                                                                                                                                                                                   |                                            | 35,427            |           |             |           | 36,418       |          
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |          
|                                                                                                                                               | Total assets                                                                                                                                                                                      |                                            | $                 | 2,496,181 |             |           | $            | 2,440,604 |          
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |          
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Liabilities:                                                                                                                                  
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Deposits-                                                                                                                                                                                        
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               |                                                                                                                                                                                                   | Noninterest bearing checking               |                   | $         | 145,373     |           |              | $         | 133,950   |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               |                                                                                                                                                                                                   | Interest checking                          |                   |           | 177,814     |           |              |           | 178,777   |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               |                                                                                                                                                                                                   | Money market                               |                   |           | 333,351     |           |              |           | 295,918   |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               |                                                                                                                                                                                                   | Savings                                    |                   |           | 184,628     |           |              |           | 199,875   |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               |                                                                                                                                                                                                   | Time deposits                              |                   |           | 1,370,226   |           |              |           | 1,349,297 |          
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |          
|                                                                                                                                               |                                                                                                                                                                                                   |                                            | Total deposits    |           |             | 2,211,392 |              |           |           | 2,157,817 | 
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Securities sold under agreements to repurchase                                                                                                                                                    |                                            |                   | 44,069    |             |           |              | 41,581    |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | FHLB advances                                                                                                                                                                                     |                                            |                   | 758       |             |           |              | 761       |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Holding company senior debt                                                                                                                                                                       |                                            |                   | 4,028     |             |           |              | 6,833     |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Convertible subordinated debt                                                                                                                                                                     |                                            |                   | 14,715    |             |           |              | 14,712    |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Term subordinated debt and unsecured notes                                                                                                                                                        |                                            |                   | 6,250     |             |           |              | 6,250     |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Other liabilities                                                                                                                                                                                 |                                            |                   | 10,160    |             |           |              | 11,559    |          
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |          
|                                                                                                                                               |                                                                                                                                                                                                   |                                            | Total liabilities |           |             | 2,291,372 |              |           |           | 2,239,513 | 
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |          
|Company-obligated mandatorily redeemable preferred
securities of subsidiary trust solely holding junior
subordinated debentures of the Company |                                                                                                                                                                                                   |                                            | 28,750            |           |             |           | 28,750       |          
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |          
|Stockholders equity:                                                                                                                         
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Perpetual preferred convertible stock ($20.00 par, 100,000 shares authorized,
75,000 shares issued and outstanding. Liquidation preference $6.6 million
at March 31, 2001 and December 31, 2000.) |                                            |                   | 1,500     |             |           |              | 1,500     |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                               | Common stock ($2.00 par, 20,000,000 shares authorized, and 10,561,439
and 10,555,989 shares issued and outstanding at March 31, 2001
and December 31, 2000, respectively.)                        |                                            |                   | 21,123    |             |           |              | 21,112    |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Capital surplus                                                                                                                                |                                                                                                                                                                                                   |                                            | 128,781           |           |             |           | 128,735      |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Retained earnings                                                                                                                              |                                                                                                                                                                                                   |                                            | 23,240            |           |             |           | 21,669       |          
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|                                                                                                                                              
|Net unrealized gain (loss) on available for sale securities, net of tax effect                                                                 |                                                                                                                                                                                                   |                                            | 1,415             |           |             |           | (675         | )         |           |           |  | 
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |          
|                                                                                                                                               |                                                                                                                                                                                                   | Total stockholders equity                 |                   |           | 176,059     |           |              |           | 172,341   |          
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |          
|                                                                                                                                               |                                                                                                                                                                                                   | Total liabilities and stockholders equity |                   | $         | 2,496,181   |           |              | $         | 2,440,604 |          
|                                                                                                                                               |                                                                                                                                                                                                   |                                            |                   |           |             |           |              |          

The accompanying notes are an integral part of these consolidated balance sheets

2



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##### Table of Contents









REPUBLIC BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
($ in thousands, except share data; unaudited)

|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |            |        |        | 
|------------------------------------------------------------- | ------------------------------------------------------------------------ | --------------------------------------------------- | ------------------------ | ---------- | ----------------------------------- | ------ | ------ | ---------- | ------ | ------ | 
|                                                              |                                                                          |                                                     |                          |            | For the Three Months Ended Mar. 31,
|                                                              |                                                                          |                                                     |                          |            |                                    
|                                                              |                                                                          |                                                     |                          |            | 2001                                |        | 2000  
|                                                              |                                                                          |                                                     |                          |            |                                     |        |       
|INTEREST INCOME:                                             
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest and fees on loans                                               |                                                     | $                        | 35,575     |                                     |        | $      | 41,331     |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on investment securities                                        |                                                     |                          | 198        |                                     |        |        | 353        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on mortgage-backed securities                                   |                                                     |                          | 5,844      |                                     |        |        | 5,994      |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on trading securities                                           |                                                     |                          | 308        |                                     |        |        | 293        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on federal funds sold                                           |                                                     |                          | 3,061      |                                     |        |        | 1,135      |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on commercial paper                                             |                                                     |                          |           |                                     |        |        | 112        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on other investments                                            |                                                     |                          | 371        |                                     |        |        | 369        |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              |                                                                          | Total interest income                               |                          |            | 45,357                              |        |        |            | 49,587 |       
|                                                             
|                                                             
|                                                             
|                                                             
|INTEREST EXPENSE:                                            
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on deposits                                                     |                                                     |                          | 26,184     |                                     |        |        | 24,867     |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on FHLB advances                                                |                                                     |                          | 13         |                                     |        |        | 13         |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on senior debt                                                  |                                                     |                          | 114        |                                     |        |        | 203        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on subordinated debt                                            |                                                     |                          | 266        |                                     |        |        | 266        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on term subordinated debt                                       |                                                     |                          | 66         |                                     |        |        | 67         |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on unsecured notes                                              |                                                     |                          | 85         |                                     |        |        |           |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Interest on other borrowings                                             |                                                     |                          | 465        |                                     |        |        | 499        |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              |                                                                          | Total interest expense                              |                          |            | 27,193                              |        |        |            | 25,915 |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              |                                                                          | Net interest income                                 |                          |            | 18,164                              |        |        |            | 23,672 |       
|                                                             
|                                                             
|                                                             
|                                                             
|PROVISION FOR LOAN LOSSES                                     |                                                                          |                                                     | 1,800                    |            |                                     |        | 4,400  |           
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              |                                                                          | Net interest income after provision for loan losses |                          |            | 16,364                              |        |        |            | 19,272 |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|NONINTEREST INCOME:                                          
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Service charges on deposit accounts                                      |                                                     |                          | 1,965      |                                     |        |        | 1,987      |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Loan service fees                                                        |                                                     |                          | 1,356      |                                     |        |        | 1,698      |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Other loan fee income                                                    |                                                     |                          | 1,030      |                                     |        |        | 967        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Gain on sale of loans, net                                               |                                                     |                          | 185        |                                     |        |        | 20         |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Gain (loss) on securities, net                                           |                                                     |                          | 920        |                                     |        |        | (139       | )     
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Other operating income                                                   |                                                     |                          | 410        |                                     |        |        | 397        |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              |                                                                          | Total noninterest income                            |                          |            | 5,866                               |        |        |            | 4,930  |       
|                                                             
|                                                             
|                                                             
|                                                             
|NONINTEREST EXPENSES:                                        
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Salaries and employee benefits                                           |                                                     |                          | 9,821      |                                     |        |        | 9,354      |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Net occupancy expense                                                    |                                                     |                          | 3,849      |                                     |        |        | 4,009      |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Advertising and marketing                                                |                                                     |                          | 225        |                                     |        |        | 538        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Data and item processing fees and services                               |                                                     |                          | 965        |                                     |        |        | 1,190      |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | FDIC and state assessments                                               |                                                     |                          | 178        |                                     |        |        | 254        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Telephone, postage and supplies                                          |                                                     |                          | 946        |                                     |        |        | 1,092      |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Legal and professional                                                   |                                                     |                          | 100        |                                     |        |        | 543        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Other operating expenses                                                 |                                                     |                          | 2,029      |                                     |        |        | 2,363      |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              |                                                                          |                                                     | Total operating expenses |            |                                     | 18,113 |        |            |        | 19,343 | 
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | ORE expense, net                                                         |                                                     |                          | 169        |                                     |        |        | 317        |       
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Amortization of goodwill & premium on deposits                           |                                                     |                          | 965        |                                     |        |        | 965        |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              |                                                                          | Total noninterest expenses                          |                          |            | 19,247                              |        |        |            | 20,625 |       
|                                                             
|                                                             
|                                                             
|                                                             
|Income before income taxes & minority interest                |                                                                          |                                                     | 2,983                    |            |                                     |        | 3,577  |           
|                                                             
|                                                             
|                                                             
|                                                             
|Income tax provision                                          |                                                                          |                                                     | (926                     | )          |                                     |        | (1,507 | )         
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|Income before minority interest                               |                                                                          |                                                     | 2,057                    |            |                                     |        | 2,070  |           
|                                                             
|                                                             
|                                                             
|                                                             
|Minority interest in income from subsidiary trust, net of tax |                                                                          |                                                     | (421                     | )          |                                     |        | (421   | )         
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              |                                                                          | NET INCOME                                          |                          | $          | 1,636                               |        |        | $          | 1,649  |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|PER SHARE DATA:                                              
|                                                             
|                                                             
|                                                             
|                                                             
|                                                              | Net income per common share  basic                                      |                                                     | $                        | .15        |                                     |        | $      | .15        |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              | Weighted average common shares outstanding-basic                         |                                                     |                          | 10,557,373 |                                     |        |        | 10,555,889 |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              | Net income per common & common equivalent
share  diluted                |                                                     | $                        | .14        |                                     |        | $      | .15        |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           
|                                                              | Weighted average common & common equivalent
shares outstanding  diluted |                                                     |                          | 11,326,530 |                                     |        |        | 11,310,181 |       
|                                                              |                                                                          |                                                     |                          |            |                                     |        |        |           

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

3



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##### Table of Contents









REPUBLIC BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
FOR THE YEAR ENDED DECEMBER 31, 2000 AND
THE THREE MONTHS ENDED MARCH 31, 2001
($ in thousands, except share data; three months ended March 31, 2001 unaudited)

|                                                                          |  |                     |        |              |  |        |       |        |  |         |            |          |  |              |        |          |  |          |         |   |  |   |        |   |  |   |        |   |  |   |         |  
|------------------------------------------------------------------------- |  | ------------------- | ------ | ------------ |  | ------ | ----- | ------ |  | ------- | ---------- | -------- |  | ------------ | ------ | -------- |  | -------- | ------- | - |  | - | ------ | - |  | - | ------ | - |  | - | ------- | -
|                                                                          |  | Perpetual Preferred
|                                                                          |  | Convertible Stock   |        | Common Stock |  |        |       |        |  |         |            |          |  | Gain/(Loss) 
|                                                                          |  |                     |        |              |  |        |       |        |  |         |            |          |  | on Available
|                                                                          |  | Shares              |        |              |  |        |       | Shares |  |         |            |          |  | Capital      |        | Retained |  | for Sale
|                                                                          |  | Issued              |        | Amount       |  | Issued |       | Amount |  | Surplus |            | Earnings |  | Securities   |        | Total   
|                                                                          |  |                     |        |              |  |        |       |        |  |         |            |          |  |              |        |         
|Balance, December 31, 1999                                                |  |                     | 75,000 |              |  | $      | 1,500 |        |  |         | 10,555,889 |          |  | $            | 21,112 |          |  | $        | 128,780 |   |  | $ | 26,530 |   |  | $ | (7,677 | ) |  | $ | 170,245 |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Net loss for the year
ended Dec. 31, 2000                                 |  |                     |       |              |  |        |      |        |  |         |           |          |  |              |       |          |  |          |        |   |  |   | (4,598 | ) |  |   |       |   |  |   | (4,598  | )
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Net unrealized gains on
available for sale securities,
net of tax effect  |  |                     |       |              |  |        |      |        |  |         |           |          |  |              |       |          |  |          |        |   |  |   |       |   |  |   | 7,002  |   |  |   | 7,002   |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Exercise of stock options                                                 |  |                     |       |              |  |        |      |        |  |         | 100        |          |  |              |       |          |  |          | 1       |   |  |   |       |   |  |   |       |   |  |   | 1       |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Adjustment to capital surplus
from nonqualified/performance
stock options |  |                     |       |              |  |        |      |        |  |         |           |          |  |              |       |          |  |          | (46     | ) |  |   |       |   |  |   |       |   |  |   | (46     | )
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Dividends on preferred
stock                                              |  |                     |       |              |  |        |      |        |  |         |           |          |  |              |       |          |  |          |        |   |  |   | (263   | ) |  |   |       |   |  |   | (263    | )
|                                                                          |  |                     |        |              |  |        |       |        |  |         |            |          |  |              |        |          |  |          |         |   |  |   |        |   |  |   |        |   |  |   |         |  
|Balance, December 31, 2000                                                |  |                     | 75,000 |              |  |        | 1,500 |        |  |         | 10,555,989 |          |  |              | 21,112 |          |  |          | 128,735 |   |  |   | 21,669 |   |  |   | (675   | ) |  |   | 172,341 |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Net income for the three months
ended March 31, 2001                      |  |                     |       |              |  |        |      |        |  |         |           |          |  |              |       |          |  |          |        |   |  |   | 1,636  |   |  |   |       |   |  |   | 1,636   |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Net unrealized gains on
available for sale securities,
net of tax effect  |  |                     |       |              |  |        |      |        |  |         |           |          |  |              |       |          |  |          |        |   |  |   |       |   |  |   | 2,090  |   |  |   | 2,090   |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Exercise of stock options                                                 |  |                     |       |              |  |        |      |        |  |         | 5,450      |          |  |              | 11     |          |  |          | 46      |   |  |   |       |   |  |   |       |   |  |   | 57      |  
|                                                                         
|                                                                         
|                                                                         
|                                                                         
|Dividends on preferred
stock                                              |  |                     |       |              |  |        |      |        |  |         |           |          |  |              |       |          |  |          |        |   |  |   | (65    | ) |  |   |       |   |  |   | (65     | )
|                                                                          |  |                     |        |              |  |        |       |        |  |         |            |          |  |              |        |          |  |          |         |   |  |   |        |   |  |   |        |   |  |   |         |  
|Balance, March 31, 2001                                                   |  |                     | 75,000 |              |  | $      | 1,500 |        |  |         | 10,561,439 |          |  | $            | 21,123 |          |  | $        | 128,781 |   |  | $ | 23,240 |   |  | $ | 1,415  |   |  | $ | 176,059 |  
|                                                                          |  |                     |        |              |  |        |       |        |  |         |            |          |  |              |        |          |  |          |         |   |  |   |        |   |  |   |        |   |  |   |         |  







REPUBLIC BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
($ in thousands; unaudited)

|                                                                  |                                                                    |   |                                     |       |      |   |        |        |  
|----------------------------------------------------------------- | ------------------------------------------------------------------ | - | ----------------------------------- | ----- | ---- | - | ------ | ------ | -
|                                                                  |                                                                    |   | For the Three Months Ended Mar. 31,
|                                                                  |                                                                    |   |                                    
|                                                                  |                                                                    |   | 2001                                |       | 2000
|                                                                  |                                                                    |   |                                     |       |     
|Net income                                                        |                                                                    | $ | 1,636                               |       |      | $ | 1,649  |       
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Unrealized (losses) on available for sale securities:            
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|                                                                  | Unrealized holding gains (losses), net of tax effect during period |   |                                     | 2,428 |      |   |        | (1,290 | )
|                                                                 
|                                                                 
|                                                                 
|                                                                 
|Less reclassification adjustment for gains realized in net income |                                                                    |   | (338                                | )     |      |   | (3     | )     
|                                                                  |                                                                    |   |                                     |       |      |   |        |        |  
|Net unrealized gains (losses)                                     |                                                                    |   | 2,090                               |       |      |   | (1,293 | )     
|                                                                  |                                                                    |   |                                     |       |      |   |        |        |  
|Comprehensive income                                              |                                                                    | $ | 3,726                               |       |      | $ | 356    |       
|                                                                  |                                                                    |   |                                     |       |      |   |        |        |  

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

4



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##### Table of Contents









REPUBLIC BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
($ in thousands; unaudited)

|                                                                                     |                                                    |                                                                        |                                                     |                   |          |                                     |        |         |         |        |        | 
|------------------------------------------------------------------------------------ | -------------------------------------------------- | ---------------------------------------------------------------------- | --------------------------------------------------- | ----------------- | -------- | ----------------------------------- | ------ | ------- | ------- | ------ | ------ | 
|                                                                                     |                                                    |                                                                        |                                                     |                   |          | For the Three Months Ended Mar. 31,
|                                                                                     |                                                    |                                                                        |                                                     |                   |          |                                    
|                                                                                     |                                                    |                                                                        |                                                     |                   |          | 2001                                |        | 2000   
|                                                                                     |                                                    |                                                                        |                                                     |                   |          |                                     |        |        
|OPERATING ACTIVITIES:                                                               
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|Net income                                                                           |                                                    | $                                                                      | 1,636                                               |                   |          | $                                   | 1,649  |        
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|Reconciliation of net income to net cash
provided by (used in) operating activities:
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Provision for loan and ORE losses                                      |                                                     |                   | 1,894    |                                     |        |         | 4,400   |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Depreciation and amortization, net                                     |                                                     |                   | 2,328    |                                     |        |         | 3,275   |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Amortization of premium (accretion) of fair value, net                 |                                                     |                   | (300     | )                                   |        |         | 1,692   |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Gain on sale of loans, net                                             |                                                     |                   | (185     | )                                   |        |         | (20     | )     
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Loss/(gain) on sale of securities                                      |                                                     |                   | (920     | )                                   |        |         | (139    | )     
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | (Gain)/loss on sale of ORE                                             |                                                     |                   | 10       |                                     |        |         | 190     |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | (Capitalization) /amortization of mortgage servicing/residual interest |                                                     |                   | (327     | )                                   |        |         | 637     |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Net (increase) decrease in deferred tax asset                          |                                                     |                   | (445     | )                                   |        |         | 393     |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Net decrease in value performance/unqualified options                  |                                                     |                   |         |                                     |        |         | (46     | )     
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Net decrease in other assets                                           |                                                     |                   | 2,228    |                                     |        |         | 2,586   |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Net increase (decrease) in other liabilities                           |                                                     |                   | (1,398   | )                                   |        |         | 310     |       
|                                                                                     |                                                    |                                                                        |                                                     |                   |          |                                     |        |        
|                                                                                     |                                                    |                                                                        | Net cash provided by operating activities           |                   |          | 4,521                               |        |         |         | 14,927 |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | INVESTING ACTIVITIES:                                                 
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Net decrease in loans                                                  |                                                     |                   | 28,858   |                                     |        |         | 1,977   |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Proceeds from sales and maturities of:                                
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    |                                                                        | Investment securities held to maturity              |                   |          |                                    |        |         |         | 3,000  |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    |                                                                        | Investment securities available for sale            |                   |          | 10,000                              |        |         |         |       |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    |                                                                        | Mortgage-backed securities available for sale       |                   |          | 57,429                              |        |         |         | 2,485  |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    |                                                                        | Commercial paper                                    |                   |          |                                    |        |         |         | 40,000 |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    |                                                                        | Revenue bonds                                       |                   |          | 75                                  |        |         |         | 75     |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Purchase of mortgage-backed securities available for sale              |                                                     |                   | (129,385 | )                                   |        |         | (34,900 | )     
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Purchase of mortgage-backed securities held to maturity                |                                                     |                   |         |                                     |        |         | (14,890 | )     
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Principal repayment on mortgage-backed securities                      |                                                     |                   | 26,733   |                                     |        |         | 12,002  |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | (Purchase) of premises & equipment, net                                |                                                     |                   | (684     | )                                   |        |         | (234    | )     
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Proceeds from sale of ORE                                              |                                                     |                   | 2,061    |                                     |        |         | 1,992   |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Investment in ORE, net                                                 |                                                     |                   | 325      |                                     |        |         | 3       |       
|                                                                                     |                                                    |                                                                        |                                                     |                   |          |                                     |        |        
|                                                                                     |                                                    |                                                                        | Net cash (used in) provided by investing activities |                   |          | (4,588                              | )      |         |         | 11,510 |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|FINANCING ACTIVITIES:                                                               
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Net increase in deposits                                               |                                                     |                   | 53,617   |                                     |        |         | 51,918  |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Net increase in repurchase agreements                                  |                                                     |                   | 2,488    |                                     |        |         | 8,859   |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Repayment of FHLB advances, net                                        |                                                     |                   | (3       | )                                   |        |         | (2      | )     
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Proceeds from issuance of common stock                                 |                                                     |                   | 57       |                                     |        |         |        |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Repayment of holding company debt                                      |                                                     |                   | (2,802   | )                                   |        |         | (831    | )     
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Dividends on perpetual preferred convertible stock                     |                                                     |                   | (66      | )                                   |        |         | (66     | )     
|                                                                                     |                                                    |                                                                        |                                                     |                   |          |                                     |        |        
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    |                                                                        | Net cash provided by financing activities           |                   |          | 53,291                              |        |         |         | 59,878 |       
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     | Net increase in cash and cash equivalents          |                                                                        |                                                     | 53,224            |          |                                     |        | 86,315  |        
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     | Cash and cash equivalents, beginning of period     |                                                                        |                                                     | 209,662           |          |                                     |        | 93,461  |        
|                                                                                     |                                                    |                                                                        |                                                     |                   |          |                                     |        |        
|                                                                                     | Cash and cash equivalents, end of period           |                                                                        | $                                                   | 262,886           |          |                                     | $      | 179,776 |        
|                                                                                     |                                                    |                                                                        |                                                     |                   |          |                                     |        |        
|                                                                                     | SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    | Cash paid during the period for-                                      
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    |                                                                        |                                                     | Interest          |          | $                                   | 18,086 |         |         | $      | 25,450 | 
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                    
|                                                                                     |                                                    |                                                                        |                                                     | Income taxes paid |          |                                     | 3,475  |         |         |        | 115    | 

The accompanying notes are an integral part of these consolidated statements

5



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##### Table of Contents









REPUBLIC BANCSHARES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Organization

In the opinion of Republic Bancshares, Inc. (the Company or Republic or
We), the accompanying consolidated financial statements (marked unaudited
where applicable) reflect all adjustments necessary to present fairly our
financial position as of March 31, 2001 and the results of operations and cash
flows, for the three months ended March 31, 2001 and 2000. The accounting and
reporting policies of the Company and its wholly-owned subsidiaries, Republic
Bank including its subsidiary Republic Insurance Agency (the Bank) and RBI
Capital Trust I (RBI), are in conformity with generally accepted accounting
principles and prevailing practices within the financial services industry.

The preparation of financial statements in conformity with generally accepted
accounting principles requires that we make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expense during the reporting period. Such
estimates are subject to change in the future as additional information becomes
available or previously existing circumstances are modified.

Our consolidated financial statements include the accounts of the Company, RBI,
the Bank, and the Banks wholly-owned subsidiary, Republic Insurance Agency,
Inc. All significant intercompany accounts and transactions have been
eliminated. Our primary source of income is from the Bank, which operates 80
branches throughout Florida. The Banks primary source of revenue has been
derived from net interest income on loans and investments.

These consolidated financial statements should be read in conjunction with the
financial statements and the notes thereto included in our Annual Report on
Form 10-K for the year ended December 31, 2000, filed with the Securities and
Exchange Commission (SEC) on March 5, 2001. The results for the three months
ended March 31, 2001, are not necessarily indicative of the results to be
expected for the fiscal year ending December 31, 2001.

Reclassifications

Certain reclassifications have been made to prior period financial statements
to conform to the March 2001 financial statement presentation. These
reclassifications had no impact on results of operations or financial position.

Recent Accounting Pronouncements

SFAS No. 133  Accounting for Derivative Instruments and Hedging Activities

In June 1998, the Financial Accounting Standards Board (FASB) issued
Statements of Financial Accounting Standards (SFAS) No. 133, Accounting for
Derivative Instruments and Hedging Activities. SFAS No. 133 establishes
accounting and reporting standards for derivative instruments, including
certain derivative instruments embedded in other contracts, (collectively
referred to as derivatives), and for hedging activities. It requires that
entities recognize all derivatives as either assets or liabilities in the
statement of financial position and measure those instruments at fair value.
In June 1999, the FASB issued SFAS No. 137, Accounting for Derivative
Instruments and Hedging Activities  Deferral of the Effective Date of SFAS No.
133, which delayed the date of implementation to all fiscal quarters of all
fiscal years beginning after June 15, 2000. In June 2000, the FASB issued SFAS
No. 138, Accounting for Certain Derivative Instruments and Certain Hedging
Activities  an amendment of SFAS No. 133, which amends the accounting and
reporting standards of SFAS No. 133 for certain derivative instruments and
certain hedging activities. The adoption of SFAS No. 133, on January 1, 2001,
did not have a material effect upon our results of operations.

6



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##### Table of Contents



SFAS No. 140  Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities (a replacement of SFAS No. 125)

In September 2000, the FASB issued SFAS No. 140, Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities (a replacement
of SFAS No. 125). SFAS No. 140 revised the standards for accounting for
securitizations and other transfers of financial assets and collateral and
requires certain disclosures, but carries over most of SFAS No. 125s
provisions without consideration. SFAS No. 140 is effective for transfers and
servicing of financial assets and extinguishments of liabilities occurring
after March 31, 2001, and requires additional disclosures relating to previous
securitization transactions and collateral for the fiscal years ending after
December 15, 2000. The adoption of SFAS No. 140 did not have a material effect
upon our results of operations.

EITF No. 99-20  Recognition of Interest Income and Impairment on Purchased and
Retained Beneficial Interest in Securitized Financial Assets

In January 2001, the Emerging Issues task Force issued EITF 99-20, Recognition
of Interest Income and Impairment on Purchased and Retained Beneficial
Interests in Securitized Financial Assets, which provides guidance on the
method used for the recognition and measurement of interest income and
impairment of those retained interests. EITF 99-20 is effective for quarterly
periods after March 15, 2001. The adoption of EITF 99-20 did not have a
material effect upon our results of operations.

2. RECENT DEVELOPMENTS

Sales and Closings of Branch Offices

On January 4, 2001, we reached agreement with Pointe Bank (Pointe) for the
sale of branch offices in Miami-Dade County, Florida. The five offices had
total deposits of $55.3 million at March 31, 2001. On April 23, 2001, Pointe
purchased the loans assigned to the branches at par value, purchased the
fixtures and improvements and other assets assigned to four of the branches at
their book value and assumed the deposit liabilities of all five offices. On
December 21, 2000, we signed an agreement with CNB National Bank (CNB) for
the sale of two branch offices. These branches are located in Lake City and
Live Oak, Florida and had total deposits of $64.0 million at March 31, 2001.
CNB agreed to purchase the loans, premises and other assets assigned to the two
branches at their net book value and to assume the deposit liabilities. The
sale was consummated on May 11, 2001.

In the first quarter of 2001, the regulatory agencies approved our applications
to close three branch offices, one in Pinellas County, one in Marion County and
one in Lake County, Florida.

Branch Openings

On January 16, 2001, we announced the opening of a new full-service branch in
Sarasota, Florida. This office will offer personal banking, commercial and real
estate lending, private banking services, including safe deposit boxes, and an
automated teller machine. In April 2001, we filed applications to open a
branch office in each of Hillsborough and Monroe Counties, Florida.

Issuance of 7% Convertible Subordinated Debentures Due 2011

On April 17, 2001 we announced that we would privately place up to $15.0
million of convertible subordinated debentures, to be due 2011 (the
Debentures). On May 8, 2001, we completed the sale of $15.0 million of the
Debentures with an interest rate of 7%. The Debentures are convertible at any
time prior to maturity, unless previously redeemed, into shares of our common
stock at a conversion price of $15.60 per share (equivalent to a conversion
rate of 64.1026 shares per $1,000 principal amount of Debentures), subject to
adjustment in certain circumstances. The Debentures are redeemable at any time
after April 1, 2006, at our option, in whole or in part, at fixed redemption
prices, together with accrued interest to the redemption date. The Debentures
may also be

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redeemed, at our option on not less than 30 days notice, without
payment of any premium, at any time after April 1, 2003, provided the closing
bid price of our common stock for not less than 20 consecutive trading days
equals or exceeds 130% of the conversion price then in effect, together with
accrued interest to the redemption date. The net proceeds from the Debentures
were used to repay $10.2 million of outstanding debt and the
balance will be used
for general corporate purposes.

3. EARNINGS PER SHARE

Diluted earnings per common and common equivalent shares have been computed by
dividing net income by the weighted average common and common equivalent shares
outstanding during the periods. The weighted average common and common
equivalent shares outstanding has been adjusted to include the number of shares
that would have been outstanding if the stock options had been exercised, at
the average market price for the period, with the proceeds being used to buy
shares from the market (i.e., the treasury stock method) and the perpetual
preferred convertible stock and the convertible subordinated debentures that
would have been converted to common stock earlier in the year or the issue date
(i.e., the if-converted method). Basic earnings per common share was computed
by dividing net income (loss) less dividends paid on the perpetual preferred
convertible stock, by the weighted average number of shares of common stock
outstanding during the year.

The table below reconciles the calculation of the diluted and basic earnings
per share for 2001 and 2000 ($ in thousands, except per share data; unaudited):

|                                               |  |                                      |       |             |  |          |            |          |  |             |     |       |  |          |       |          |  |  |            |  |  |   |      |  |  |  |  | 
|---------------------------------------------- |  | ------------------------------------ | ----- | ----------- |  | -------- | ---------- | -------- |  | ----------- | --- | ----- |  | -------- | ----- | -------- |  |  | ---------- |  |  | - | ---- |  |  |  |  | 
|                                               |  | For the three Months Ended March 31,
|                                               |  |                                     
|                                               |  | 2001                                 |       | 2000       
|                                               |  |                                      |       |            
|                                               |  |                                      |       |             |  | Weighted |            | Earnings |  |             |     |       |  | Weighted |       | Earnings
|                                               |  | Net                                  |       | Shares      |  | Per      |            | Net      |  | Shares      |     | Per  
|                                               |  | Income                               |       | Outstanding |  | Share    |            | Income   |  | Outstanding |     | Share
|                                               |  |                                      |       |             |  |          |            |          |  |             |     |      
|Net income attributable
to common stockholders |  | $                                    | 1,570 |             |  |          | 10,557,373 |          |  |             |    |       |  | $        | 1,583 |          |  |  | 10,555,889 | 
|                                              
|                                              
|                                              
|                                              
|Basic earnings per share                       |  |                                      |      |             |  |          |           |          |  | $           | .15 |       |  |          |      |          |  |  |           |  |  | $ | .15  | 
|                                              
|                                              
|                                              
|                                              
|Weighted average options
outstanding(1)        |  |                                      |      |             |  |          | 19,157     |          |  |             |    |       |  |          |      |          |  |  | 12,599     |  |  |   |     | 
|                                              
|                                              
|                                              
|                                              
|Convertible perpetual
preferred stock          |  |                                      | 66    |             |  |          | 750,000    |          |  |             |    |       |  |          | 66    |          |  |  | 750,000    |  |  |   |     | 
|                                               |  |                                      |       |             |  |          |            |          |  |             |     |       |  |          |       |          |  |  |            |  |  |   |      | 
|Diluted earnings per share                     |  | $                                    | 1,636 |             |  |          | 11,326,530 |          |  | $           | .14 |       |  | $        | 1,649 |          |  |  | 11,318,488 |  |  | $ | 0.15 | 
|                                               |  |                                      |       |             |  |          |            |          |  |             |     |       |  |          |       |          |  |  |            |  |  |   |      | 



---

|(1) |  | There were 521,217 and 601,967 of stock options that were
antidilutive as of March 31, 2001 and 2000, respectively, and
there were 833,333 shares of convertible subordinated debentures
which were antidilutive as of March 31, 2001 and 2000.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4. INVESTMENT, MORTGAGE-BACKED AND MORTGAGE-RELATED SECURITIES

Investments consisting of U.S. Treasury and federal agency securities
(Investment Securities), mortgage-backed securities (MBS) and
mortgage-related securities (Mortgage-Related Securities) were $469.6 million
at March 31, 2001. As of March 31, 2001, $390.2 million of securities were
classified as available for sale (of which $381.5 million were MBS and $8.7
million were Investment Securities), $31.4 million of MBS were classified as
held to maturity and $47.9 million of Mortgage Related Securities were trading
assets. Included in the trading asset category were: (1) a $10.9 million
subordinate tranche purchased from our securitization of high loan-to-value
loans (High LTV Loans) in June 1998 (the Subordinate Tranche); (2) $10.2
million in overcollateralization and residual interests in cash flows from a
$60.0 million securitization in December 1997 and a $240.0 million
securitization in June 1998 (the Residuals); (3) $23.2 million of FHLMC
mortgage-backed securities resulting from loan securitizations in the current
quarter; and (4) $3.6 million representing the excess spread on mortgage
servicing rights.

The market values assigned to the MBS classified as available for sale and the
FHLMC mortgage-backed securities classified as trading were derived using
market quotations at March 31, 2001. Other trading assets are evaluated at
least quarterly with any valuation adjustment reflected as a trading gain or
loss in the statement of operations. Under

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applicable accounting rules, use of
quoted market values is the preferred method for valuing trading assets.
However, where the market for those assets is illiquid and/or price quotations
are not readily available, other methods are permitted, including techniques
utilizing the present value of expected cash flows. We have used present value
techniques to value the Subordinate Tranche, the Residuals and the excess
spread on mortgage servicing rights. The key assumptions used in the
valuations were as follows ($ in thousands, at March 31, 2001):

|                                    |  |                |        |                |  |                    |         |   |  |  |       |  
|----------------------------------- |  | -------------- | ------ | -------------- |  | ------------------ | ------- | - |  |  | ----- | -
|                                    |  | December 1997  |        | June 1998      |  | Excess Spread-    
|                                    |  | Securitization |        | Securitization |  | Mortgage-Servicing
|                                    |  | ("1997-1")     |        | ("1998-1")     |  | Rights            
|                                    |  |                |        |                |  |                   
|Collateral amount                   |  | $              | 32,390 |                |  | $                  | 161,935 |   |  |  | N/A   |  
|                                   
|                                   
|                                   
|                                   
|Market Value                        |  |                | 3,119  |                |  |                    | 7,021   |   |  |  | 3,620 |  
|                                   
|                                   
|                                   
|                                   
|Discount rate                       |  |                | 15.00  | %              |  |                    | 15.00   | % |  |  | 12.00 | %
|                                   
|                                   
|                                   
|                                   
|Prepayment speed                    |  |                | 14.00  |                |  |                    | 12.00   |   |  |  | 12.00 |  
|                                   
|                                   
|                                   
|                                   
|Cumulative lifetime default rate(1) |  |                | 22.92  |                |  |                    | 19.75   |   |  |  | N/A   |  



---

|(1) |  | Expressed as the percent of total defaults over the expected life of the
collateral to the initial collateral amount.
|--- |  | ---------------------------------------------------------------------------------------------------------------------

5. LOANS

Loans at March 31, 2001 and December 31, 2000, are summarized as follows ($ in
thousands; March 31, 2001 unaudited):

|                               |                                |                                       |         |           |           |              |         |           |           | 
|------------------------------ | ------------------------------ | ------------------------------------- | ------- | --------- | --------- | ------------ | ------- | --------- | --------- | 
|                               |                                |                                       |         | March 31, |           | December 31,
|                               |                                |                                       |         | 2001      |           | 2000        
|                               |                                |                                       |         |           |           |             
|Real estate mortgage loans:   
|                              
|                              
|                              
|                              
|                               | One-to-four family residential |                                       | $       | 590,758   |           |              | $       | 638,296   |          
|                              
|                              
|                              
|                              
|                               | Nonconforming mortgages        |                                       |         | 63,768    |           |              |         | 65,662    |          
|                              
|                              
|                              
|                              
|                               | Multifamily residential        |                                       |         | 88,933    |           |              |         | 89,938    |          
|                              
|                              
|                              
|                              
|                               | Warehouse lines of credit      |                                       |         | 34,742    |           |              |         | 39,835    |          
|                              
|                              
|                              
|                              
|                               | Commercial real estate         |                                       |         | 446,532   |           |              |         | 438,092   |          
|                              
|                              
|                              
|                              
|                               | Construction/land development  |                                       |         | 102,980   |           |              |         | 115,650   |          
|                               |                                |                                       |         |           |           |              |         |          
|                               |                                | Mortgage loans secured by first liens |         |           | 1,327,713 |              |         |           | 1,387,473 | 
|                              
|                              
|                              
|                              
|Commercial (business) loans    |                                |                                       | 130,284 |           |           |              | 124,699 |          
|                              
|                              
|                              
|                              
|Consumer loans                 |                                |                                       | 23,565  |           |           |              | 23,431  |          
|                              
|                              
|                              
|                              
|Home equity loans              |                                |                                       | 138,935 |           |           |              | 137,845 |          
|                              
|                              
|                              
|                              
|High LTV Loans                 |                                |                                       | 36,112  |           |           |              | 37,894  |          
|                               |                                |                                       |         |           |           |              |         |          
|                               | Total gross portfolio loans    |                                       |         | 1,656,609 |           |              |         | 1,711,342 |          
|                              
|                              
|                              
|                              
|Less-allowance for loan losses |                                |                                       | (33,183 | )         |           |              | (33,462 | )        
|                               |                                |                                       |         |           |           |              |         |          
|                               | Total loans held for portfolio |                                       | $       | 1,623,426 |           |              | $       | 1,677,880 |          
|                               |                                |                                       |         |           |           |              |         |          

Mortgage loans serviced for others as of March 31, 2001 and December 31, 2000,
were $1.2 billion and $1.3 billion, respectively. Mortgage loan servicing
rights (both purchased and originated) amounted to $19.0 million and $19.6
million at March 31, 2001 and December 31, 2000, respectively. Loans on which
interest was not being accrued at March 31, 2001 and December 31, 2000, totaled
approximately $50.4 million and $49.4 million, respectively. Loans past due 90
days or more and still accruing interest at March 31, 2001 and December 31,
2000 totaled $774,000 and $1.2 million, respectively.

9



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At March 31, 2001, the composition of our loan portfolio, according to the
location of the borrower or the real estate taken as underlying collateral, was
as follows ($ in thousands, unaudited):

|      |                                       |        |   |           |           |            |  |      |        |  
|----- | ------------------------------------- | ------ | - | --------- | --------- | ---------- |  | ---- | ------ | -
|      |                                       |        |   | Disbursed |           | Percent of
|State |                                       | Amount |   | Total    
|      |                                       |        |   |          
|      | Florida                               |        | $ | 1,270,230 |           |            |  | 76.7 | %     
|     
|     
|     
|     
|      | New England(1)                        |        |   | 86,113    |           |            |  | 5.2  |       
|     
|     
|     
|     
|      | California                            |        |   | 40,485    |           |            |  | 2.4  |       
|     
|     
|     
|     
|      | Texas                                 |        |   | 37,029    |           |            |  | 2.2  |       
|     
|     
|     
|     
|      | Georgia                               |        |   | 29,122    |           |            |  | 1.8  |       
|     
|     
|     
|     
|      | Illinois                              |        |   | 23,979    |           |            |  | 1.5  |       
|     
|     
|     
|     
|      | Virginia                              |        |   | 23,459    |           |            |  | 1.4  |       
|     
|     
|     
|     
|      | New Jersey                            |        |   | 20,222    |           |            |  | 1.2  |       
|     
|     
|     
|     
|      | New York                              |        |   | 19,428    |           |            |  | 1.2  |       
|     
|     
|     
|     
|      | North Carolina                        |        |   | 17,753    |           |            |  | 1.1  |       
|     
|     
|     
|     
|      | Ohio                                  |        |   | 16,693    |           |            |  | 1.0  |       
|     
|     
|     
|     
|      | Missouri                              |        |   | 10,614    |           |            |  | 0.6  |       
|     
|     
|     
|     
|      | All other (none greater than $10,000) |        |   | 61,483    |           |            |  | 3.7  |       
|      |                                       |        |   |           |           |            |  |     
|      |                                       | Total  |   | $         | 1,656,609 |            |  |      | 100.00 | %
|      |                                       |        |   |           |           |            |  |      |       



---

|(1) |  | New England has been defined by us to include the states of Connecticut,
Delaware, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------

6. ALLOWANCES FOR LOSSES

Allowance for loan losses

The allowance for loan losses provides for risks of losses inherent in the
credit extension process. Losses and recoveries are either charged or credited
to the allowance. Our allowance is an amount that we believe will be adequate
to absorb probable losses on existing loans that may become uncollectible,
based on our evaluations of the collectibility of the loans and prior loan loss
experience. The evaluations take into consideration such factors as changes in
the nature and volume of the loan portfolio, overall portfolio quality, review
of specific problem loans, and current economic conditions that may affect the
borrowers ability to pay. The evaluations are periodically reviewed and adjustments are recorded in the
period in which changes become known.

While we believe that the allowance for loan losses was adequate as of March
31, 2001, based on currently available information, future provisions to the
allowance may be necessary due to changes in economic conditions, deterioration
of creditworthiness of the borrower, the value of underlying collateral, or
other factors. Additionally, the Florida Department of Banking and Finance
(the Department), the Federal Deposit Insurance Corporation (the FDIC), and
the Federal Reserve, as an integral part of their regular examination process,
periodically review the allowance for loan losses. These agencies may require
additions to the allowance based on their judgments about information available
to them at the time of examination. The portion of the allowance for loan
losses that was created through the allocation of discounts on purchased loans
may only be used to absorb losses on the related acquired loans. As of March
31, 2001, approximately $648,000 of the allowance remained from the discount
allocations for the March 1995 purchased loans.

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Changes in the allowance for loan losses were as follows ($ in thousands;
unaudited):

|                                                             |                 |   |                                     |        |      |   |        |        |  
|------------------------------------------------------------ | --------------- | - | ----------------------------------- | ------ | ---- | - | ------ | ------ | -
|                                                             |                 |   | For the Three Months Ended Mar. 31,
|                                                             |                 |   |                                    
|                                                             |                 |   | 2001                                |        | 2000
|                                                             |                 |   |                                     |        |     
|Balance, beginning of period                                 |                 | $ | 33,462                              |        |      | $ | 28,177 |       
|                                                            
|                                                            
|                                                            
|                                                            
|Provision for possible loan losses                           |                 |   | 1,800                               |        |      |   | 4,400  |       
|                                                            
|                                                            
|                                                            
|                                                            
|Loan discount (net) allocated to (from) purchased portfolios |                 |   |                                    |        |      |   | (5     | )     
|                                                            
|                                                            
|                                                            
|                                                            
|Loans charged-off                                            |                 |   | (2,319                              | )      |      |   | (2,749 | )     
|                                                            
|                                                            
|                                                            
|                                                            
|Recoveries of loans charged-off                              |                 |   | 240                                 |        |      |   | 647    |       
|                                                             |                 |   |                                     |        |      |   |        |       
|                                                             | Net charge-offs |   |                                     | (2,079 | )    |   |        | (2,102 | )
|                                                             |                 |   |                                     |        |      |   |        |       
|Balance, end of period                                       |                 | $ | 33,183                              |        |      | $ | 30,470 |       
|                                                             |                 |   |                                     |        |      |   |        |       

Allowance for Losses on Other Real Estate (ORE)

We generally conduct appraisals on ORE on an annual basis. We recognize any
estimated potential decline in the value of ORE between appraisal dates through
periodic additions to the allowance for losses on ORE. Writedowns charged
against this allowance are taken if the related real estate is sold at a loss.

State banking regulations require us to dispose of all ORE acquired through
foreclosure within five years of acquisition, with a possibility for additional
extensions, each of up to five years. There were no properties, which have
exceeded the five-year holding period limitation as of March 31, 2001.

7. RELATED PARTY TRANSACTIONS

Mr. William R. Hough, is chairman of the board, a director, and our largest
shareholder. Mr. Hough is also President and the controlling shareholder of
William R. Hough & Co. (WRHC), a NASD-member investment-banking firm. During
1999, we entered into an agreement with WRHC whereby they would act as our
agent in open-market purchases and sales of securities. WRHC is compensated
under that agreement on a commission basis. We also periodically purchase
securities under agreement to repurchase at a rate based on the prevailing
federal funds rate and one-eighth of one percent, per an agreement entered into
on August 15, 1995. For the quarter ended March 31, 2001, we purchased $127.8
million and sold $58.1 million of securities through WRHC. There were no
securities sold under agreement to repurchase with WRHC in the first quarter of
2001.

Previously, we had borrowed from Mr. Hough, individually, $3.5 million on an
unsecured, revolving line of credit basis and $1.5 million via term
subordinated debt. The proceeds were used for holding company debt service. On
May 8, 2001, we repaid both obligations in full using the net proceeds from our
issuance of Debentures (see Note 2  Recent Developments). WRHC participated
as a selling agent in the placement of the Debentures and was paid a
$89,000
fee for its sales efforts. Mr. Hough, individually, purchased $3.7 million of
the Debentures. No fee was paid on sale of Debentures to Mr. Hough or any
other director of the Company.

WRHC offers sales of insurance and mutual fund products and investment advisory
services on our premises. We are paid 50% of the net profits earned from sales
of investment products on our premises. Fee income earned from this
relationship was $10,000 and $50,000 for the three months ended March 31, 2001
and 2000, respectively.

Certain other directors and executive officers, members of their immediate
families, and entities with which such persons are associated are customers of
ours. As such, they had transactions in the ordinary course of business with
us. All loans and commitments to lend included in those transactions were made
in the ordinary course of business, upon substantially the same terms.
Features including interest rates and collateral, as those prevailing at the
time for comparable transactions with other persons and, in our opinion, have
not involved more than the normal risk of collectibility or presented other
unfavorable features.

11



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8. HOLDING COMPANY CASHFLOW AND DEBT SERVICE

Florida statutes limit the amount of dividends we can pay in any given year to
that years net income plus retained net income from the preceding two years.
Additionally, we cannot pay dividends, which would cause us to be
undercapitalized as defined by federal regulations. Under the Florida
Financial Institutions Code, the prior approval of the Department is required
if the total of all dividends declared by a bank in any calendar year will
exceed the sum of a banks net retained profits (net income less any dividends
paid) for that year and its retained net profits for the preceding two years.
As of March 31, 2001, there was a net retained profit surplus for dividend
payment purposes of $616,000.

[Balance of page intentionally left blank]

12



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##### Table of Contents









Selected Quarterly Financial and Other Data
Five Consecutive Quarters
($ in thousands, except share data; unaudited)

|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|-------------------------------------------------------------- |  | -------------- | ---------- | --------- |  | ---------- | ---------- | --------- |  | --------- | ---------- | - |  | - | ---------- | - |  | - | ---------- | -
|                                                               |  | Quarters Ended
|                                                               |  |               
|                                                               |  | Mar. 2001      |            | Dec. 2000 |  | Sept. 2000 |            | June 2000 |  | Mar. 2000
|                                                               |  |                |            |           |  |            |            |           |  |          
|OPERATING DATA:                                               
|                                                              
|                                                              
|                                                              
|                                                              
|Interest income                                                |  | $              | 45,357     |           |  | $          | 47,605     |           |  | $         | 49,163     |   |  | $ | 50,846     |   |  | $ | 49,587     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Interest expense                                               |  |                | 27,193     |           |  |            | 27,509     |           |  |           | 27,217     |   |  |   | 26,836     |   |  |   | 25,915     |  
|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|Net interest income                                            |  |                | 18,164     |           |  |            | 20,096     |           |  |           | 21,946     |   |  |   | 24,010     |   |  |   | 23,672     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Loan loss provision                                            |  |                | 1,800      |           |  |            | 6,300      |           |  |           | 5,000      |   |  |   | 5,000      |   |  |   | 4,400      |  
|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|Net interest income after loan loss provision                  |  |                | 16,364     |           |  |            | 13,796     |           |  |           | 16,946     |   |  |   | 19,010     |   |  |   | 19,272     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Noninterest income (expense)                                   |  |                | 5,866      |           |  |            | (7,088     | )         |  |           | 5,290      |   |  |   | 4,178      |   |  |   | 4,930      |  
|                                                              
|                                                              
|                                                              
|                                                              
|Operating expenses                                             |  |                | 18,113     |           |  |            | 19,618     |           |  |           | 17,951     |   |  |   | 18,612     |   |  |   | 19,343     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Other noninterest expense                                      |  |                | 1,134      |           |  |            | 1,181      |           |  |           | 1,048      |   |  |   | 994        |   |  |   | 1,282      |  
|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|Net income before income taxes
& minority interest             |  |                | 2,983      |           |  |            | (14,091    | )         |  |           | 3,237      |   |  |   | 3,582      |   |  |   | 3,577      |  
|                                                              
|                                                              
|                                                              
|                                                              
|Income tax benefit (expense)                                   |  |                | (926       | )         |  |            | 5,063      |           |  |           | (1,295     | ) |  |   | (1,474     | ) |  |   | (1,507     | )
|                                                              
|                                                              
|                                                              
|                                                              
|Minority interest in income from
subsidiary trust              |  |                | (421       | )         |  |            | (421       | )         |  |           | (426       | ) |  |   | (421       | ) |  |   | (421       | )
|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|Net income (loss)                                              |  | $              | 1,636      |           |  | $          | (9,449     | )         |  | $         | 1,516      |   |  | $ | 1,687      |   |  | $ | 1,649      |  
|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|PER SHARE DATA:                                               
|                                                              
|                                                              
|                                                              
|                                                              
|Earnings per share  basic                                     |  | $              | .15        |           |  | $          | (.90       | )         |  | $         | .14        |   |  | $ | .15        |   |  | $ | .15        |  
|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|Weighted average shares outstanding  basic                    |  |                | 10,557,373 |           |  |            | 10,555,989 |           |  |           | 10,555,989 |   |  |   | 10,555,897 |   |  |   | 10,555,889 |  
|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|Earnings per share  diluted                                   |  | $              | .14        |           |  | $          | (.90       | )         |  | $         | .13        |   |  | $ | .15        |   |  | $ | .15        |  
|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|Weighted average shares outstanding  diluted                  |  |                | 11,326,530 |           |  |            | 10,555,989 |           |  |           | 11,311,158 |   |  |   | 11,307,494 |   |  |   | 11,310,181 |  
|                                                               |  |                |            |           |  |            |            |           |  |           |            |   |  |   |            |   |  |   |            |  
|BALANCE SHEET DATA (at period-end):                           
|                                                              
|                                                              
|                                                              
|                                                              
|Total assets                                                   |  | $              | 2,496,181  |           |  | $          | 2,440,604  |           |  | $         | 2,490,181  |   |  | $ | 2,554,828  |   |  | $ | 2,626,458  |  
|                                                              
|                                                              
|                                                              
|                                                              
|Investment & mortgage-backed securities                        |  |                | 469,560    |           |  |            | 406,957    |           |  |           | 440,312    |   |  |   | 466,180    |   |  |   | 442,845    |  
|                                                              
|                                                              
|                                                              
|                                                              
|Portfolio loans, net of unearned income                        |  |                | 1,656,609  |           |  |            | 1,711,342  |           |  |           | 1,790,143  |   |  |   | 1,864,640  |   |  |   | 1,882,560  |  
|                                                              
|                                                              
|                                                              
|                                                              
|Nonperforming assets                                           |  |                | 56,127     |           |  |            | 56,973     |           |  |           | 60,100     |   |  |   | 36,066     |   |  |   | 29,903     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Allowance for loan losses                                      |  |                | 33,183     |           |  |            | 33,462     |           |  |           | 30,441     |   |  |   | 28,273     |   |  |   | 30,470     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Goodwill & premium on deposits                                 |  |                | 28,004     |           |  |            | 28,969     |           |  |           | 29,933     |   |  |   | 30,897     |   |  |   | 31,862     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Deposits                                                       |  |                | 2,211,392  |           |  |            | 2,157,817  |           |  |           | 2,195,515  |   |  |   | 2,267,111  |   |  |   | 2,346,816  |  
|                                                              
|                                                              
|                                                              
|                                                              
|Stockholders equity                                           |  |                | 176,059    |           |  |            | 172,341    |           |  |           | 178,109    |   |  |   | 173,254    |   |  |   | 170,489    |  
|                                                              
|                                                              
|                                                              
|                                                              
|Book value per share (dollars)                                 |  |                | 15.56      |           |  |            | 15.24      |           |  |           | 15.75      |   |  |   | 15.32      |   |  |   | 15.08      |  
|                                                              
|                                                              
|                                                              
|                                                              
|SELECTED FINANCIAL RATIOS:                                    
|                                                              
|                                                              
|                                                              
|                                                              
|Return on average assets                                       |  |                | 0.27       | %         |  |            | (1.53      | )%        |  |           | 0.24       | % |  |   | 0.26       | % |  |   | 0.26       | %
|                                                              
|                                                              
|                                                              
|                                                              
|Return on average equity                                       |  |                | 3.82       |           |  |            | (21.16     | )         |  |           | 3.44       |   |  |   | 3.96       |   |  |   | 3.90       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Equity to assets                                               |  |                | 7.05       |           |  |            | 7.06       |           |  |           | 7.15       |   |  |   | 6.78       |   |  |   | 6.49       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Equity and minority interest in preferred
subsidiary to assets |  |                | 8.20       |           |  |            | 8.24       |           |  |           | 8.31       |   |  |   | 7.91       |   |  |   | 7.58       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Portfolio loans/deposit ratio                                  |  |                | 74.91      |           |  |            | 79.31      |           |  |           | 81.54      |   |  |   | 82.25      |   |  |   | 80.22      |  
|                                                              
|                                                              
|                                                              
|                                                              
|Net interest spread                                            |  |                | 2.63       |           |  |            | 2.97       |           |  |           | 3.29       |   |  |   | 3.49       |   |  |   | 3.50       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Net interest margin                                            |  |                | 3.09       |           |  |            | 3.45       |           |  |           | 3.73       |   |  |   | 3.89       |   |  |   | 3.86       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Operating expense to average assets                            |  |                | 2.94       |           |  |            | 3.19       |           |  |           | 2.88       |   |  |   | 2.88       |   |  |   | 3.00       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Operating efficiency ratio                                     |  |                | 75.38      |           |  |            | 150.81     |           |  |           | 65.91      |   |  |   | 66.03      |   |  |   | 67.63      |  
|                                                              
|                                                              
|                                                              
|                                                              
|Loan loss allowance to portfolio loans                         |  |                | 2.00       |           |  |            | 1.96       |           |  |           | 1.70       |   |  |   | 1.52       |   |  |   | 1.62       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Loan loss allowance to nonperforming loans                     |  |                | 64.87      |           |  |            | 66.12      |           |  |           | 56.30      |   |  |   | 95.68      |   |  |   | 128.40     |  
|                                                              
|                                                              
|                                                              
|                                                              
|CAPITAL RATIOS:                                               
|                                                              
|                                                              
|                                                              
|                                                              
|Tier 1 (leverage)  Company                                    |  |                | 6.34       |           |  |            | 6.30       |           |  |           | 6.37       |   |  |   | 6.14       |   |  |   | 5.93       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Tier 1 (leverage)  Bank                                       |  |                | 7.02       |           |  |            | 7.18       |           |  |           | 7.25       |   |  |   | 6.95       |   |  |   | 6.78       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Tier 1/risk-assets  Company                                   |  |                | 10.14      |           |  |            | 10.27      |           |  |           | 10.05      |   |  |   | 9.81       |   |  |   | 9.27       |  
|                                                              
|                                                              
|                                                              
|                                                              
|Tier 1/risk assets  Bank                                      |  |                | 11.24      |           |  |            | 11.69      |           |  |           | 11.45      |   |  |   | 11.12      |   |  |   | 10.59      |  
|                                                              
|                                                              
|                                                              
|                                                              
|Risk-based capital  Company                                   |  |                | 12.55      |           |  |            | 12.69      |           |  |           | 12.48      |   |  |   | 12.20      |   |  |   | 11.65      |  
|                                                              
|                                                              
|                                                              
|                                                              
|Risk-based capital  Bank                                      |  |                | 12.49      |           |  |            | 12.94      |           |  |           | 12.75      |   |  |   | 12.41      |   |  |   | 11.89      |  
|                                                              
|                                                              
|                                                              
|                                                              
|OTHER DATA (at period-end):                                   
|                                                              
|                                                              
|                                                              
|                                                              
|Number of branch banking offices                               |  |                | 80         |           |  |            | 80         |           |  |           | 81         |   |  |   | 81         |   |  |   | 81         |  
|                                                              
|                                                              
|                                                              
|                                                              
|Number of full-time equivalent employees                       |  |                | 955        |           |  |            | 995        |           |  |           | 996        |   |  |   | 997        |   |  |   | 995        |  

13



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##### Table of Contents



REPUBLIC BANCSHARES, INC.
QUARTERLY NONPERFORMING ASSET TREND
($ in thousands; unaudited)

|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |           |        |        |          |        |        |        |        |        |        |  
|------------------------------------------------ | ---------------------------------- | ----------------------------- | ------ | ------ | -------------- | ------ | --------- | ------ | ---------- | ------ | --------- | ------ | --------- | ------ | ------ | -------- | ------ | ------ | ------ | ------ | ------ | ------ | -
|                                                 |                                    |                               |        |        | Quarters Ended
|                                                 |                                    |                               |        |        |               
|                                                 |                                    |                               |        |        | Mar. 2001      |        | Dec. 2000 |        | Sept. 2000 |        | June 2000 |        | Mar. 2000
|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |          
|Non-performing loans:                           
|                                                
|                                                
|                                                
|                                                
|Residential first lien                           |                                    | $                             | 11,111 |        |                | $      | 11,017    |        |            | $      | 11,312    |        |           | $      | 14,133 |          |        | $      | 15,380 |       
|                                                
|                                                
|                                                
|                                                
|Warehouse lines of credit                        |                                    |                               | 2,421  |        |                |        | 3,029     |        |            |        | 2,467     |        |           |        | 2,867  |          |        |        | 48     |       
|                                                
|                                                
|                                                
|                                                
|Nonconforming first lien                         |                                    |                               | 4,347  |        |                |        | 3,485     |        |            |        | 3,866     |        |           |        | 4,280  |          |        |        | 4,177  |       
|                                                
|                                                
|                                                
|                                                
|Commercial real estate                           |                                    |                               | 30,620 |        |                |        | 30,181    |        |            |        | 34,274    |        |           |        | 6,332  |          |        |        | 1,327  |       
|                                                
|                                                
|                                                
|                                                
|Multifamily residential                          |                                    |                               |       |        |                |        |          |        |            |        | 315       |        |           |        |       |          |        |        |       |       
|                                                
|                                                
|                                                
|                                                
|Commercial (business)                            |                                    |                               | 1,097  |        |                |        | 736       |        |            |        | 650       |        |           |        | 592    |          |        |        | 602    |       
|                                                
|                                                
|                                                
|                                                
|Home equity                                      |                                    |                               | 1,023  |        |                |        | 1,504     |        |            |        | 686       |        |           |        | 831    |          |        |        | 1,841  |       
|                                                
|                                                
|                                                
|                                                
|Consumer & other                                 |                                    |                               | 69     |        |                |        | 176       |        |            |        | 80        |        |           |        | 178    |          |        |        | 183    |       
|                                                
|                                                
|                                                
|                                                
|High LTV                                         |                                    |                               | 466    |        |                |        | 477       |        |            |        | 424       |        |           |        | 336    |          |        |        | 173    |       
|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |           |        |        |          |        |        |        |        |        |        |  
|                                                 |                                    | Total nonperforming loans (1) |        |        | 51,154         |        |           |        | 50,605     |        |           |        | 54,074    |        |        |          | 29,549 |        |        |        | 23,731 |       
|                                                
|                                                
|                                                
|                                                
|Other nonperforming receivables                  |                                    |                               | 477    |        |                |        | 639       |        |            |        | 653       |        |           |        | 687    |          |        |        | 711    |       
|                                                
|                                                
|                                                
|                                                
|Other real estate:                              
|                                                
|                                                
|                                                
|                                                
|Residential                                      |                                    |                               | 1,679  |        |                |        | 2,559     |        |            |        | 1,737     |        |           |        | 2,508  |          |        |        | 2,141  |       
|                                                
|                                                
|                                                
|                                                
|Commercial                                       |                                    |                               | 2,817  |        |                |        | 3,170     |        |            |        | 3,636     |        |           |        | 3,322  |          |        |        | 3,320  |       
|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |           |        |        |          |        |        |        |        |        |        |  
|                                                 |                                    | Total ORE                     |        |        | 4,496          |        |           |        | 5,729      |        |           |        | 5,373     |        |        |          | 5,830  |        |        |        | 5,461  |       
|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |           |        |        |          |        |        |        |        |        |        |  
|                                                 |                                    | Total nonperforming assets    |        | $      | 56,127         |        |           | $      | 56,973     |        |           | $      | 60,100    |        |        | $        | 36,066 |        |        | $      | 29,903 |       
|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |           |        |        |          |        |        |        |        |        |        |  
|Memorandum:                                     
|                                                
|                                                
|                                                
|                                                
|Past due 90+ days-still accruing
(incl. above)   |                                    | $                             | 774    |        |                | $      | 1,209     |        |            | $      | 3         |        |           | $      | 46     |          |        | $      | 4      |       
|                                                
|                                                
|                                                
|                                                
|Nonperforming loans/portfolio loans              |                                    |                               | 3.09   | %      |                |        | 2.96      | %      |            |        | 3.02      | %      |           |        | 1.58   | %        |        |        | 1.26   | %     
|                                                
|                                                
|                                                
|                                                
|Nonperforming assets/assets                      |                                    |                               | 2.25   |        |                |        | 2.33      |        |            |        | 2.41      |        |           |        | 1.41   |          |        |        | 1.14   |       
|                                                
|                                                
|                                                
|                                                
|ORE/assets                                       |                                    |                               | 0.18   |        |                |        | 0.23      |        |            |        | 0.22      |        |           |        | 0.23   |          |        |        | 0.21   |       
|                                                
|                                                
|                                                
|                                                
|Loan loss allowance to nonperforming loans:     
|                                                
|                                                
|                                                
|                                                
|                                                 | Originated portfolio               |                               |        | 63.88  | %              |        |           | 65.19  | %          |        |           | 56.05  | %         |        |        | 98.18    | %      |        |        | 143.60 | %     
|                                                
|                                                
|                                                
|                                                
|                                                 | July 1997 purchase                 |                               |        |       |                |        |           |       |            |        |           | 2.93   |           |        |        | 1.94     |        |        |        | 2.43   |       
|                                                
|                                                
|                                                
|                                                
|                                                 | March 1995 purchase                |                               |        | 239.46 |                |        |           | 199.25 |            |        |           | 238.39 |           |        |        | 1,136.17 |        |        |        | 228.45 |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Other purchased portfolios         |                               |        |       |                |        |           |       |            |        |           | 58.26  |           |        |        | 69.52    |        |        |        | 21.03  |       
|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |           |        |        |          |        |        |        |        |        |        |  
|                                                 |                                    |                               | Total  |        |                | 64.87  | %         |        |            | 66.12  | %         |        |           | 56.30  | %      |          |        | 95.68  | %      |        |        | 128.40 | %
|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |           |        |        |          |        |        |        |        |        |        |  
|Other loan delinquency data
30-89 days past due:
|                                                
|                                                
|                                                
|                                                
|                                                 | Residential first lien             |                               | $      | 8,343  |                |        | $         | 10,929 |            |        | $         | 11,229 |           |        | $      | 8,169    |        |        | $      | 9,170  |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Warehouse lines of credit          |                               |        |       |                |        |           | 2,813  |            |        |           |       |           |        |        | 222      |        |        |        | 11,048 |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Nonconforming first lien           |                               |        | 2,646  |                |        |           | 2,612  |            |        |           | 3,454  |           |        |        | 2,867    |        |        |        | 3,087  |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Commercial real estate/multifamily |                               |        | 7,089  |                |        |           | 6,133  |            |        |           | 2,240  |           |        |        | 1,925    |        |        |        | 915    |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Commercial (business)              |                               |        | 1,656  |                |        |           | 1,827  |            |        |           | 1,054  |           |        |        | 686      |        |        |        | 824    |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Home equity                        |                               |        | 2,815  |                |        |           | 1,934  |            |        |           | 1,893  |           |        |        | 1,290    |        |        |        | 1,351  |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Consumer & other                   |                               |        | 262    |                |        |           | 398    |            |        |           | 343    |           |        |        | 378      |        |        |        | 364    |       
|                                                
|                                                
|                                                
|                                                
|                                                 | High LTV                           |                               |        | 1,858  |                |        |           | 2,410  |            |        |           | 2,342  |           |        |        | 2,890    |        |        |        | 2,385  |       
|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |           |        |        |          |        |        |        |        |        |        |  
|                                                 |                                    |                               | Total  |        | $              | 24,669 |           |        | $          | 29,056 |           |        | $         | 22,555 |        |          | $      | 18,427 |        |        | $      | 29,144 |  
|                                                 |                                    |                               |        |        |                |        |           |        |            |        |           |        |           |        |        |          |        |        |        |        |        |        |  



---

|(1) |  | Represents all loans on nonaccrual and all loans 90 days and over past due
|--- |  | --------------------------------------------------------------------------

14



---



##### Table of Contents



REPUBLIC BANCSHARES, INC.
QUARTERLY CREDIT LOSS EXPERIENCE
($ in thousands; unaudited)

|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |           |  
|--------------------------------------------------------- | -------------------------------------- | - | -------------- | --------- | --------- | - | ---------- | --------- | --------- | - | --------- | --------- | - | - | ------- | --------- | - | - | ------- | --------- | -
|                                                          |                                        |   | Quarters Ended
|                                                          |                                        |   |               
|                                                          |                                        |   | Mar. 2001      |           | Dec. 2000 |   | Sept. 2000 |           | June 2000 |   | Mar. 2000
|                                                          |                                        |   |                |           |           |   |            |           |           |   |          
|Daily average loans outstanding:                         
|                                                         
|                                                         
|                                                         
|                                                         
|Residential first lien                                    |                                        | $ | 595,848        |           |           | $ | 619,567    |           |           | $ | 649,313   |           |   | $ | 668,806 |           |   | $ | 689,922 |          
|                                                         
|                                                         
|                                                         
|                                                         
|Warehouse lines of credit                                 |                                        |   | 33,871         |           |           |   | 36,918     |           |           |   | 52,584    |           |   |   | 71,124  |           |   |   | 81,049  |          
|                                                         
|                                                         
|                                                         
|                                                         
|Nonconforming first lien mortgages                        |                                        |   | 64,905         |           |           |   | 67,028     |           |           |   | 70,129    |           |   |   | 73,570  |           |   |   | 78,118  |          
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial real estate/multifamily                        |                                        |   | 672,626        |           |           |   | 689,803    |           |           |   | 704,278   |           |   |   | 728,835 |           |   |   | 714,664 |          
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial (business)                                     |                                        |   | 122,569        |           |           |   | 124,423    |           |           |   | 109,626   |           |   |   | 100,975 |           |   |   | 80,728  |          
|                                                         
|                                                         
|                                                         
|                                                         
|Home equity                                               |                                        |   | 138,595        |           |           |   | 136,215    |           |           |   | 133,508   |           |   |   | 130,791 |           |   |   | 122,501 |          
|                                                         
|                                                         
|                                                         
|                                                         
|Consumer                                                  |                                        |   | 24,107         |           |           |   | 23,856     |           |           |   | 24,746    |           |   |   | 24,937  |           |   |   | 23,719  |          
|                                                         
|                                                         
|                                                         
|                                                         
|High LTV                                                  |                                        |   | 36,996         |           |           |   | 68,440     |           |           |   | 83,372    |           |   |   | 87,269  |           |   |   | 90,142  |          
|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |          
|                                                          | Total                                  |   | $              | 1,689,517 |           |   | $          | 1,766,250 |           |   | $         | 1,827,556 |   |   | $       | 1,886,307 |   |   | $       | 1,880,843 |  
|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |          
|Allowance for loan losses at beginning of period          |                                        | $ | 33,462         |           |           | $ | 30,441     |           |           | $ | 28,273    |           |   | $ | 30,470  |           |   | $ | 28,177  |          
|                                                         
|                                                         
|                                                         
|                                                         
|Loan discount (net) allocated to/                        
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | (from) purchased portfolios            |   |                |          |           |   |            | (384      | )         |   |           |          |   |   |         |          |   |   |         | (5        | )
|                                                         
|                                                         
|                                                         
|                                                         
|Provision for loan losses                                 |                                        |   | 1,800          |           |           |   | 6,300      |           |           |   | 5,000     |           |   |   | 5,000   |           |   |   | 4,400   |          
|                                                         
|                                                         
|                                                         
|                                                         
|Acquired reserve-purchased loans                          |                                        |   |               |           |           |   |           |           |           |   |          |           |   |   |        |           |   |   |        |          
|                                                         
|                                                         
|                                                         
|                                                         
|Charge-offs:                                             
|                                                         
|                                                         
|                                                         
|                                                         
|Residential first lien                                    |                                        |   | (188           | )         |           |   | (547       | )         |           |   | (388      | )         |   |   | (374    | )         |   |   | (463    | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Warehouse lines of credit                                 |                                        |   | (26            | )         |           |   | (522       | )         |           |   | (77       | )         |   |   | (4,412  | )         |   |   | (66     | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Nonconforming first lien mortgages                        |                                        |   | (153           | )         |           |   | (237       | )         |           |   | (172      | )         |   |   | (290    | )         |   |   | (319    | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial real estate/multifamily                        |                                        |   | (4             | )         |           |   | (710       | )         |           |   | (65       | )         |   |   | (1      | )         |   |   |        |          
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial (business)                                     |                                        |   |               |           |           |   | (10        | )         |           |   | (55       | )         |   |   | (3      | )         |   |   |        |          
|                                                         
|                                                         
|                                                         
|                                                         
|Home equity                                               |                                        |   | (517           | )         |           |   | (33        | )         |           |   | (235      | )         |   |   | (945    | )         |   |   |        |          
|                                                         
|                                                         
|                                                         
|                                                         
|Consumer                                                  |                                        |   | (136           | )         |           |   | (39        | )         |           |   | (109      | )         |   |   | (44     | )         |   |   | (34     | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Other                                                     |                                        |   | (149           | )         |           |   | (62        | )         |           |   | (67       | )         |   |   | (82     | )         |   |   | (32     | )        
|                                                         
|                                                         
|                                                         
|                                                         
|High LTV                                                  |                                        |   | (1,146         | )         |           |   | (1,400     | )         |           |   | (1,879    | )         |   |   | (1,299  | )         |   |   | (1,835  | )        
|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |          
|                                                          | Total charge-offs                      |   |                | (2,319    | )         |   |            | (3,560    | )         |   |           | (3,047    | ) |   |         | (7,450    | ) |   |         | (2,749    | )
|                                                         
|                                                         
|                                                         
|                                                         
|Recoveries:                                              
|                                                         
|                                                         
|                                                         
|                                                         
|Residential first lien                                    |                                        |   | 26             |           |           |   | 63         |           |           |   | 43        |           |   |   | 31      |           |   |   | 48      |          
|                                                         
|                                                         
|                                                         
|                                                         
|Warehouse lines of credit                                 |                                        |   | 10             |           |           |   | 13         |           |           |   | 28        |           |   |   | 10      |           |   |   |        |          
|                                                         
|                                                         
|                                                         
|                                                         
|Nonconforming first lien mortgages                        |                                        |   |               |           |           |   | 71         |           |           |   |          |           |   |   | 4       |           |   |   |        |          
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial real estate/multifamily                        |                                        |   | 19             |           |           |   | 180        |           |           |   | 11        |           |   |   | 3       |           |   |   | 287     |          
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial (business)                                     |                                        |   | 19             |           |           |   | 11         |           |           |   | 14        |           |   |   | 9       |           |   |   | 29      |          
|                                                         
|                                                         
|                                                         
|                                                         
|Home equity                                               |                                        |   | 6              |           |           |   | 11         |           |           |   | 37        |           |   |   | 9       |           |   |   | 4       |          
|                                                         
|                                                         
|                                                         
|                                                         
|Consumer                                                  |                                        |   | 13             |           |           |   | 17         |           |           |   | 12        |           |   |   | 12      |           |   |   | 11      |          
|                                                         
|                                                         
|                                                         
|                                                         
|Other                                                     |                                        |   | 18             |           |           |   | 15         |           |           |   | 26        |           |   |   | 5       |           |   |   | 2       |          
|                                                         
|                                                         
|                                                         
|                                                         
|High LTV                                                  |                                        |   | 129            |           |           |   | 284        |           |           |   | 44        |           |   |   | 170     |           |   |   | 266     |          
|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |          
|                                                          | Total recoveries                       |   |                | 240       |           |   |            | 665       |           |   |           | 215       |   |   |         | 253       |   |   |         | 647       |  
|                                                         
|                                                         
|                                                         
|                                                         
|Net (charge-offs) recoveries:                            
|                                                         
|                                                         
|                                                         
|                                                         
|Residential first lien                                    |                                        |   | (162           | )         |           |   | (484       | )         |           |   | (345      | )         |   |   | (343    | )         |   |   | (415    | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Warehouse lines of credit                                 |                                        |   | (16            | )         |           |   | (509       | )         |           |   | (49       | )         |   |   | (4,402  | )         |   |   | (66     | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Nonconforming first lien mortgages                        |                                        |   | (153           | )         |           |   | (166       | )         |           |   | (172      | )         |   |   | (286    | )         |   |   | (319    | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial real estate/multifamily                        |                                        |   | 15             |           |           |   | (530       | )         |           |   | (54       | )         |   |   | 2       |           |   |   | 287     |          
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial (business)                                     |                                        |   | 19             |           |           |   | 1          |           |           |   | (41       | )         |   |   | 6       |           |   |   | 29      |          
|                                                         
|                                                         
|                                                         
|                                                         
|Home equity                                               |                                        |   | (511           | )         |           |   | (22        | )         |           |   | (198      | )         |   |   | (936    | )         |   |   | 4       |          
|                                                         
|                                                         
|                                                         
|                                                         
|Consumer                                                  |                                        |   | (123           | )         |           |   | (22        | )         |           |   | (97       | )         |   |   | (32     | )         |   |   | (23     | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Other                                                     |                                        |   | (131           | )         |           |   | (47        | )         |           |   | (41       | )         |   |   | (77     | )         |   |   | (30     | )        
|                                                         
|                                                         
|                                                         
|                                                         
|High LTV                                                  |                                        |   | (1,017         | )         |           |   | (1,116     | )         |           |   | (1,835    | )         |   |   | (1,129  | )         |   |   | (1,569  | )        
|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |          
|                                                          | Net charge-offs                        |   |                | (2,079    | )         |   |            | (2,895    | )         |   |           | (2,832    | ) |   |         | (7,197    | ) |   |         | (2,102    | )
|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |          
|Allowance for loan losses at end of period                |                                        | $ | 33,183         |           |           | $ | 33,462     |           |           | $ | 30,441    |           |   | $ | 28,273  |           |   | $ | 30,470  |          
|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |          
|Net charge-offs (recoveries) to average loans-annualized:
|                                                         
|                                                         
|                                                         
|                                                         
|Residential first lien                                    |                                        |   | 0.11           | %         |           |   | 0.31       | %         |           |   | 0.21      | %         |   |   | 0.21    | %         |   |   | 0.24    | %        
|                                                         
|                                                         
|                                                         
|                                                         
|Warehouse lines of credit                                 |                                        |   | 0.19           |           |           |   | 5.51       |           |           |   | 0.37      |           |   |   | 24.76   |           |   |   | 0.33    |          
|                                                         
|                                                         
|                                                         
|                                                         
|Nonconforming first lien mortgages                        |                                        |   | 0.94           |           |           |   | 0.99       |           |           |   | 0.98      |           |   |   | 1.55    |           |   |   | 1.63    |          
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial real estate/multifamily                        |                                        |   | (0.01          | )         |           |   | 0.31       |           |           |   | 0.03      |           |   |   |        |           |   |   | (0.16   | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Commercial (business)                                     |                                        |   | (0.06          | )         |           |   |           |           |           |   | 0.15      |           |   |   | (0.02   | )         |   |   | (0.14   | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Home equity                                               |                                        |   | 1.47           |           |           |   | 0.06       |           |           |   | 0.59      |           |   |   | 2.86    |           |   |   | (0.01   | )        
|                                                         
|                                                         
|                                                         
|                                                         
|Consumer                                                  |                                        |   | 2.04           |           |           |   | 0.37       |           |           |   | 1.57      |           |   |   | 0.51    |           |   |   | 0.39    |          
|                                                         
|                                                         
|                                                         
|                                                         
|High LTV                                                  |                                        |   | 11.00          |           |           |   | 6.52       |           |           |   | 8.80      |           |   |   | 5.17    |           |   |   | 6.96    |          
|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |          
|                                                          | Total net charge-offs to average loans |   |                | 0.49      | %         |   |            | 0.66      | %         |   |           | 0.62      | % |   |         | 1.53      | % |   |         | 0.45      | %
|                                                          |                                        |   |                |           |           |   |            |           |           |   |           |           |   |   |         |           |   |   |         |          

15



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##### Table of Contents









|        |  |                                                                                      
|------- |  | -------------------------------------------------------------------------------------
|Item 2. |  | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

Comparison of Balance Sheets at March 31, 2001 and December 31, 2000

Overview

At March 31, 2001, we had total assets of $2.5 billion, stockholders equity of
$176.1 million and a book value per share of $15.56, compared with total assets
of $2.4 billion, stockholders equity of $172.3 million and a book value of
$15.24 at December 31, 2000. Loans, net of allowances for loan losses, were
$1.6 billion at March 31, 2001, a decrease of $54.5 million from $1.7 billion
at December 31, 2000, while total deposits were $2.2 billion, an increase of
$53.6 million from $2.2 billion at year-end 2000.

Investment, Mortgage-Backed and Mortgage-Related Securities

Investments consisting of Investment Securities, MBS, and Mortgage-Related
Securities were $469.6 million as compared to $407.0 million at the end of
last year. At March 31, 2001, $390.3 million of securities were classified as
available for sale, $31.4 million of MBS were classified as held to maturity
and $47.9 million of Mortgage-Related Securities were trading assets. These
trading assets consisted of: (1) a $10.9 million subordinate tranche purchased
from our securitization of High LTV Loans in June 1998; (2) $10.2 million in
overcollateralization and residual interests in cash flows from
securitizations in December 1997 and June 1998; (3) $23.2 million of FHLMC
mortgage-backed securities resulting from loan securitizations in the first
quarter of the current year (these securities were sold in April 2001); and
(4) the excess spread on mortgage servicing rights, which amounted to $3.6
million at March 31, 2001.

Loans

Total loans declined by $54.7 million from $1.71 billion at the prior year-end
to $1.66 billion at March 31, 2001. This decline primarily resulted from
payoffs and other reductions of warehouse lines of credit and residential
mortgages which more than offset increases in commercial and consumer loans.
Warehouse lines of credit decreased $5.1 million, nonconforming mortgages
decreased $1.9 million and conventional/government residential loans declined
by $47.5 million (including the loan securitization in March). High LTV Loans
decreased by $1.8 million. Commercial loans increased $5.6 million and home
equity loans increased $1.1 million, while commercial real estate loans and
business loans secured by real estate increased $8.4 million. Also
contributing to the decline was the securitization of $23.2 million of seasoned
fixed rate residential loans in March 2001.

Allowance for Loan Losses

The allowance for loan losses amounted to $33.2 million (2.00% of portfolio
loans) at March 31, 2001, compared with $33.5 million (1.96% of portfolio
loans) at December 31, 2000. Activity to the allowance in 2001 included
provisions for loan losses of $1.8 million less loan charge-offs (net of
recoveries) of $2.1 million. At March 31, 2001, the ratio of the allowance for
loan losses to nonperforming loans was 64.87% compared to 66.12% at the end of
2000.

Nonperforming Assets

Nonperforming assets amounted to $56.1 million (2.25% of total assets) at March
31, 2001, compared with $57.0 million (2.33% of total assets) at December 31,
2000. ORE balances decreased $1.2 million to $4.5 million but this improvement
was partially offset by an increase in nonperforming loans which totaled $51.2
million at March 31, 2001, $549,000 higher than the prior year-end total of
$50.6 million.

16



---



##### Table of Contents



Deposits

Total deposits were $2.2 billion at March 31, 2001, a $53.6 million increase
from the prior year-end. Money market accounts increased by $37.4 million,
certificates of deposit increased by $20.9 million, and checking accounts
(including non-retail deposits such as official checks) increased by $10.5
million, while savings deposits declined by $15.2 million (primarily from
shifts to the money market product).

Holding Company Debt

Holding company debt decreased by $2.8 million to $25.0 million at March 31,
2001. Holding company debt at March 31, 2001, consisted of a non-revolving
line of credit (Senior Debt) with SunTrust Bank, N.A. of $4.0 million, term
subordinated debt payable to several of our current and former directors of
$2.8 million, $3.5 million of unsecured notes from Mr. Hough, the chairman of
the holding companys board (see Note 7  Related Party Transactions) and
$14.7 million of convertible subordinated debentures due 2014. The Senior Debt,
term subordinated debt and the unsecured notes to Mr. Hough were all repaid on
May 8, 2001 using the net proceeds from issuance of convertible subordinated
debt due 2011 (see Note 2  Recent Developments).

Stockholders Equity

Stockholders equity was $176.1 million at March 31, 2001, or 7.05% of total
assets, compared to $172.3 million or 7.06% of total assets at December 31,
2000. At March 31, 2001, the Banks tier 1 (leverage) capital ratio was
7.02%, its tier 1 (risk-based) capital ratio was 11.24%, and its total
risk-based capital ratio was 12.49%, all in excess of minimum FDIC guidelines
for an institution to be considered a well-capitalized bank. The same
ratios for the Company at March 31, 2001 were 6.34%, 10.14%, and 12.55%,
respectively.

[Balance of page intentionally left blank]

17



---



##### Table of Contents



Comparison of Results of Operations for the Three Months Ended March 31, 2001 and 2000

Overview

Net income for the first quarter of 2001 was $1.6 million, or $.14 per share
(on a diluted basis), compared with $1.6 million, or $.15 per share, on the
same basis for the same period in 2000. In the current quarter we recorded a
$1.8 million loan loss provision compared with a $4.4 million loan loss
provision in 2000. The provision in the prior quarter was largely the result of
losses in the portfolio of warehouse lines of credit.

Analysis of Net Interest Income (see table on page 19)

Net interest income for the three months ended March 31, 2001, was $18.2
million compared with $23.7 million for the same period last year, a $5.5
million or 23.3% decrease. The decrease was the result of two major factors,
the largest of which was a $191.3 million decline in the average balance of
loans outstanding. The majority of this decline resulted from payoffs and
sales of discontinued loan products including warehouse lines of credit and
High LTV Loans which together accounted for $100.3 million of the decline.
The Companys exit from out of state lending activities also contributed to
the decrease. New business initiatives partially offset that decline by
increasing the average balance of consumer home equity loans and commercial
(business) loans. Net interest income also was adversely effected by the
rapid decline in market interest rates that occurred in the first quarter of
2001 which, when combined with the Companys asset sensitive interest rate
position during the first 120 days following a rate change, resulted in a
decline in asset yield. Interest income was $45.4 million for the first
quarter of 2001, a decrease of $4.2 million over the same period in 2000.
Interest expense increased by $1.3 million from $25.9 million in 2000 to $27.2
million in 2001. Average asset yield decreased by 32 basis points from 8.16%
for the same period of 2000 to 7.84% for 2001. The average cost of
interest-bearing liabilities increased by 55 basis points from 4.66% to 5.21%.

Noninterest Income

Noninterest income for the three months ended March 31, 2001 was $5.9 million
compared with $4.9 million for the same period of 2000, an increase of
$936,000. Improvements to noninterest income included a $724,000 increase in
net trading securities gain (primarily from the securitization of $23.2
million of seasoned, fixed rate residential loans into mortgage-backed
securities) and a $335,000 increase in gain on sale of securities.

The following table reflects the components of noninterest income for the
three months ended March 31, 2001, and 2000 ($ in thousands; unaudited):

|                                    |  |                                      |       |      |  |            |       |   |  |          |      |  
|----------------------------------- |  | ------------------------------------ | ----- | ---- |  | ---------- | ----- | - |  | -------- | ---- | -
|                                    |  | For the Three Months Ended March 31,
|                                    |  |                                     
|                                    |  |                                      |       |      |  |            |       |   |  | Increase
|                                    |  | 2001                                 |       | 2000 |  | (Decrease)
|                                    |  |                                      |       |      |  |           
|Service charges on deposit accounts |  | $                                    | 1,965 |      |  | $          | 1,987 |   |  | $        | (22  | )
|                                   
|                                   
|                                   
|                                   
|Loan service fees                   |  |                                      | 1,356 |      |  |            | 1,698 |   |  |          | (342 | )
|                                   
|                                   
|                                   
|                                   
|Other loan fee income               |  |                                      | 1,030 |      |  |            | 967   |   |  |          | 63   |  
|                                   
|                                   
|                                   
|                                   
|Gain on sale of loans, net          |  |                                      | 185   |      |  |            | 20    |   |  |          | 165  |  
|                                   
|                                   
|                                   
|                                   
|Gain on sale of securities, net     |  |                                      | 338   |      |  |            | 3     |   |  |          | 335  |  
|                                   
|                                   
|                                   
|                                   
|Net trading securities gain (loss)  |  |                                      | 582   |      |  |            | (142  | ) |  |          | 724  |  
|                                   
|                                   
|                                   
|                                   
|Other income                        |  |                                      | 410   |      |  |            | 397   |   |  |          | 13   |  
|                                    |  |                                      |       |      |  |            |       |   |  |          |      |  
|Total noninterest income            |  | $                                    | 5,866 |      |  | $          | 4,930 |   |  | $        | 936  |  
|                                    |  |                                      |       |      |  |            |       |   |  |          |      |  

18



---



##### Table of Contents



The following table summarizes the average yields earned on interest earning
assets and the average rates paid on interest bearing liabilities for the
three months ended March 31, 2001 and 2000 ($ in thousands; unaudited):

|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |           |         |   |        |        |  |  |      |      |   |  |  |  | 
|--------------------------------------- | ---------------------------------- | ------- | ---------------------------- | --------- | ---- | ---- | ------ | ------- | ------- | -------- | ------- | ---- | - |  | - | --------- | ------- | - | ------ | ------ |  |  | ---- | ---- | - |  |  |  | 
|                                        |                                    |         | Three Months Ended March 31,
|                                        |                                    |         |                              |          
|                                        |                                    |         | 2001                         |           | 2000
|                                        |                                    |         |                              |           |     
|                                        |                                    |         | Average                      |           |      |      |        |         | Average |          | Average |      |   |  |   |           | Average
|Summary of Average Rates                |                                    | Balance |                              | Interest  |      | Rate |        | Balance |         | Interest |         | Rate
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |     
|Interest earning assets:               
|                                       
|                                       
|                                       
|                                       
|                                        | Loans, net                         |         | $                            | 1,689,516 |      |      | $      | 35,575  |         |          |         | 8.45 | % |  | $ | 1,880,843 |         |   | $      | 41,331 |  |  |      | 8.76 | %
|                                       
|                                       
|                                       
|                                       
|                                        | Investment securities              |         |                              | 12,020    |      |      |        | 198     |         |          |         | 6.59 |   |  |   | 25,230    |         |   |        | 353    |  |  |      | 5.60 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Mortgage-backed securities         |         |                              | 348,507   |      |      |        | 5,844   |         |          |         | 6.71 |   |  |   | 370,707   |         |   |        | 5,994  |  |  |      | 6.47 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Trading securities                 |         |                              | 25,312    |      |      |        | 308     |         |          |         | 4.86 |   |  |   | 39,032    |         |   |        | 293    |  |  |      | 3.00 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Commercial paper                   |         |                              |          |      |      |        |        |         |          |         |     |   |  |   | 7,549     |         |   |        | 112    |  |  |      | 5.87 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Interest bearing deposits in banks |         |                              | 7,540     |      |      |        | 109     |         |          |         | 5.85 |   |  |   | 5,743     |         |   |        | 93     |  |  |      | 6.55 |  
|                                       
|                                       
|                                       
|                                       
|                                        | FHLB stock                         |         |                              | 13,816    |      |      |        | 263     |         |          |         | 7.73 |   |  |   | 13,816    |         |   |        | 276    |  |  |      | 8.02 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Federal funds sold                 |         |                              | 223,016   |      |      |        | 3,060   |         |          |         | 5.49 |   |  |   | 80,534    |         |   |        | 1,135  |  |  |      | 5.57 |  
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |           |         |   |        |       
|                                        | Total interest earning assets      |         |                              | 2,319,727 |      |      |        | 45,357  |         |          |         | 7.84 |   |  |   | 2,423,454 |         |   |        | 49,587 |  |  |      | 8.16 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Noninterest earning assets         |         |                              | 140,684   |      |      |        |         |         |          |         |      |   |  |   | 153,265   |        
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |          
|                                        | Total assets                       |         | $                            | 2,460,411 |      |      |        |         |         |          |         |      |   |  | $ | 2,576,719 |        
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |          
|Interest bearing liabilities:          
|                                       
|                                       
|                                       
|                                       
|                                        | Interest checking                  |         |                              | 175,048   |      |      |        | 239     |         |          |         | 0.55 |   |  |   | 185,690   |         |   |        | 350    |  |  |      | 0.76 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Money market                       |         |                              | 308,572   |      |      |        | 3,426   |         |          |         | 4.50 |   |  |   | 246,871   |         |   |        | 2,520  |  |  |      | 4.11 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Savings                            |         |                              | 57,015    |      |      |        | 226     |         |          |         | 1.61 |   |  |   | 61,967    |         |   |        | 254    |  |  |      | 1.65 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Passbook Gold                      |         |                              | 133,435   |      |      |        | 1,333   |         |          |         | 4.05 |   |  |   | 220,836   |         |   |        | 2,252  |  |  |      | 4.10 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Time deposits                      |         |                              | 1,374,482 |      |      |        | 20,960  |         |          |         | 6.18 |   |  |   | 1,455,094 |         |   |        | 19,491 |  |  |      | 5.39 |  
|                                       
|                                       
|                                       
|                                       
|                                        | FHLB advances                      |         |                              | 759       |      |      |        | 13      |         |          |         | 6.85 |   |  |   | 768       |         |   |        | 13     |  |  |      | 6.85 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Subordinated debt                  |         |                              | 14,713    |      |      |        | 266     |         |          |         | 7.23 |   |  |   | 14,685    |         |   |        | 266    |  |  |      | 7.23 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Other holding company debt         |         |                              | 10,825    |      |      |        | 265     |         |          |         | 9.87 |   |  |   | 11,556    |         |   |        | 270    |  |  |      | 9.40 |  
|                                       
|                                       
|                                       
|                                       
|                                        | Other borrowings                   |         |                              | 41,880    |      |      |        | 465     |         |          |         | 4.50 |   |  |   | 38,909    |         |   |        | 499    |  |  |      | 5.16 |  
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |           |         |   |        |       
|                                        | Total interest bearing liabilities |         |                              | 2,116,729 |      |      |        | 27,193  |         |          |         | 5.21 |   |  |   | 2,236,376 |         |   |        | 25,915 |  |  |      | 4.66 |  
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |           |         |   |        |       
|                                        | Noninterest bearing liabilities    |         |                              | 175,627   |      |      |        |         |         |          |         |      |   |  |   | 170,296   |        
|                                       
|                                       
|                                       
|                                       
|                                        | Stockholders equity               |         |                              | 168,055   |      |      |        |         |         |          |         |      |   |  |   | 170,047   |        
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |          
|                                        | Total liabilities and equity       |         | $                            | 2,460,411 |      |      |        |         |         |          |         |      |   |  | $ | 2,576,719 |        
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |          
|Net interest income/net
interest spread |                                    |         |                              |           |      | $    | 18,164 |         |         |          | 2.63    | %    |   |  |   |           |         | $ | 23,672 |        |  |  | 3.50 | %   
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |           |         |   |        |        |  |  |      |     
|Net interest margin                     |                                    |         |                              |           |      |      |        |         |         |          | 3.09    | %    |   |  |   |           |         |   |        |        |  |  | 3.86 | %   
|                                        |                                    |         |                              |           |      |      |        |         |         |          |         |      |   |  |   |           |         |   |        |        |  |  |      |     

|                                  |                                    |                                 |        |                            |        |       |        |       |     |   |        |        |        |  
|--------------------------------- | ---------------------------------- | ------------------------------- | ------ | -------------------------- | ------ | ----- | ------ | ----- | --- | - | ------ | ------ | ------ | -
|                                  |                                    |                                 |        | Increase (Decrease) Due to
|                                  |                                    |                                 |        |                           
|Changes in Net Interest Income    |                                    | Volume                          |        | Rate                       |        | Total
|                                  |                                    |                                 |        |                            |        |      
|Interest earning assets:         
|                                 
|                                 
|                                 
|                                 
|                                  | Loans, net                         |                                 |        | (5,588                     | )      |       |        | (168  | )   |   |        | (5,756 | )     
|                                 
|                                 
|                                 
|                                 
|                                  | Investment securities              |                                 |        | (181                       | )      |       |        | 26    |     |   |        | (155   | )     
|                                 
|                                 
|                                 
|                                 
|                                  | Mortgage-backed securities         |                                 |        | (328                       | )      |       |        | 178   |     |   |        | (150   | )     
|                                 
|                                 
|                                 
|                                 
|                                  | Trading securities                 |                                 |        | (126                       | )      |       |        | 141   |     |   |        | 15     |       
|                                 
|                                 
|                                 
|                                 
|                                  | Commercial paper                   |                                 |        | (111                       | )      |       |        |      |     |   |        | (111   | )     
|                                 
|                                 
|                                 
|                                 
|                                  | Interest bearing deposits in banks |                                 |        | 26                         |        |       |        | (11   | )   |   |        | 15     |       
|                                 
|                                 
|                                 
|                                 
|                                  | FHLB stock                         |                                 |        |                           |        |       |        | (12   | )   |   |        | (12    | )     
|                                 
|                                 
|                                 
|                                 
|                                  | Federal funds sold                 |                                 |        | 1,944                      |        |       |        | (18   | )   |   |        | 1,926  |       
|                                  |                                    |                                 |        |                            |        |       |        |       |     |   |        |       
|                                  |                                    | Total change in interest income |        |                            | (4,364 | )     |        |       | 136 |   |        |        | (4,228 | )
|                                 
|                                 
|                                 
|                                 
|Interest bearing liabilities:    
|                                 
|                                 
|                                 
|                                 
|                                  | Interest checking                  |                                 |        | (23                        | )      |       |        | (88   | )   |   |        | (111   | )     
|                                 
|                                 
|                                 
|                                 
|                                  | Money market                       |                                 |        | 645                        |        |       |        | 260   |     |   |        | 905    |       
|                                 
|                                 
|                                 
|                                 
|                                  | Savings                            |                                 |        | (22                        | )      |       |        | (6    | )   |   |        | (28    | )     
|                                 
|                                 
|                                 
|                                 
|                                  | Passbook Gold                      |                                 |        | (892                       | )      |       |        | (27   | )   |   |        | (919   | )     
|                                 
|                                 
|                                 
|                                 
|                                  | Time deposits                      |                                 |        | (1,117                     | )      |       |        | 2,586 |     |   |        | 1,469  |       
|                                 
|                                 
|                                 
|                                 
|                                  | FHLB advances                      |                                 |        |                           |        |       |        |      |     |   |        |       |       
|                                 
|                                 
|                                 
|                                 
|                                  | Subordinated debt                  |                                 |        | 1                          |        |       |        |      |     |   |        | 1      |       
|                                 
|                                 
|                                 
|                                 
|                                  | Other holding company debt         |                                 |        | (21                        | )      |       |        | 16    |     |   |        | (5     | )     
|                                 
|                                 
|                                 
|                                 
|                                  | Other borrowings                   |                                 |        | 32                         |        |       |        | (65   | )   |   |        | (33    | )     
|                                  |                                    |                                 |        |                            |        |       |        |       |     |   |        |       
|Total change in interest expense  |                                    |                                 | (1,397 | )                          |        |       | 2,676  |       |     |   | 1,279  |       
|                                  |                                    |                                 |        |                            |        |       |        |       |     |   |        |       
|(Decrease) in net interest income |                                    | $                               | (2,967 | )                          |        | $     | (2,540 | )     |     | $ | (5,507 | )     
|                                  |                                    |                                 |        |                            |        |       |        |       |     |   |        |       

19



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##### Table of Contents



Noninterest Expense

Operating expenses for the first quarter of 2001 were $18.1 million compared
with $19.3 million for the same period last year, a decrease of $1.2 million
or 6.36%. This improvement includes a $443,000 decrease in legal and
professional expenses, and a $225,000 decrease in data processing fees and
services, resulting largely from cost-saving initiatives implemented in 2000
and 2001. Total noninterest expenses, which includes operating expenses,
were $19.2 million for the three months ended March 31, 2001 compared with
$20.6 million for the same period last year.

The following table reflects the components of noninterest expense for the
three months ended March 31, 2001 and 2000 ($ in thousands; unaudited):

|                                                 |  |                                      |        |      |  |            |        |  |  |          |        |  
|------------------------------------------------ |  | ------------------------------------ | ------ | ---- |  | ---------- | ------ |  |  | -------- | ------ | -
|                                                 |  | For the Three Months Ended March 31,
|                                                 |  |                                     
|                                                 |  |                                      |        |      |  |            |        |  |  | Increase
|                                                 |  | 2001                                 |        | 2000 |  | (Decrease)
|                                                 |  |                                      |        |      |  |           
|Salaries and benefits                            |  | $                                    | 9,821  |      |  | $          | 9,354  |  |  |          | 467    |  
|                                                
|                                                
|                                                
|                                                
|Net occupancy expense                            |  |                                      | 3,849  |      |  |            | 4,009  |  |  |          | (160   | )
|                                                
|                                                
|                                                
|                                                
|Advertising and marketing                        |  |                                      | 225    |      |  |            | 538    |  |  |          | (313   | )
|                                                
|                                                
|                                                
|                                                
|Data processing fees and services                |  |                                      | 965    |      |  |            | 1,190  |  |  |          | (225   | )
|                                                
|                                                
|                                                
|                                                
|FDIC and state assessments                       |  |                                      | 178    |      |  |            | 254    |  |  |          | (76    | )
|                                                
|                                                
|                                                
|                                                
|Telephone expense                                |  |                                      | 368    |      |  |            | 361    |  |  |          | 7      |  
|                                                
|                                                
|                                                
|                                                
|Postage and supplies                             |  |                                      | 578    |      |  |            | 731    |  |  |          | (153   | )
|                                                
|                                                
|                                                
|                                                
|Legal and professional                           |  |                                      | 100    |      |  |            | 543    |  |  |          | (443   | )
|                                                
|                                                
|                                                
|                                                
|Other operating expense                          |  |                                      | 2,029  |      |  |            | 2,363  |  |  |          | (334   | )
|                                                 |  |                                      |        |      |  |            |        |  |  |          |        |  
|Total operating expenses                         |  |                                      | 18,113 |      |  |            | 19,343 |  |  |          | (1,230 | )
|                                                
|                                                
|                                                
|                                                
|ORE expense, net of ORE income                   |  |                                      | 75     |      |  |            | 317    |  |  |          | (242   | )
|                                                
|                                                
|                                                
|                                                
|Provision for losses on ORE                      |  |                                      | 94     |      |  |            |       |  |  |          | 94     |  
|                                                
|                                                
|                                                
|                                                
|Amortization of premium on deposits
and goodwill |  |                                      | 965    |      |  |            | 965    |  |  |          |       |  
|                                                 |  |                                      |        |      |  |            |        |  |  |          |        |  
|Total noninterest expense                        |  | $                                    | 19,247 |      |  | $          | 20,625 |  |  | $        | (1,378 | )
|                                                 |  |                                      |        |      |  |            |        |  |  |          |        |  







Part II. Other Information







Item 1. Legal Proceedings

In November 1999, 18 former shareholders of Bankers Savings Bank, F.S.B.
(BSB) filed a claim against us in the Miami-Dade County, Florida, Circuit
Court that alleges we had knowledge of and failed to disclose to BSB and to
their shareholders, prior to acquiring BSB in November 1998, the loss incurred
for the fourth quarter of 1998 that resulted from a now-discontinued mortgage
banking operation. The claim alleges breach of contract, fraud, negligent
misrepresentation and violation of the Florida Securities and Investor
Protection Act. The plaintiffs have alleged damages generally in an amount
exceeding $1 million. This matter has been scheduled for trial in June 2001.
We believe the plaintiffs claims are without merit and intend to continue
defending such action vigorously.

We are subject to various legal proceedings in the ordinary course of
business. Based on information presently available, we do not believe that
the ultimate outcome in such proceedings, in the aggregate, would have a
material adverse effect on our financial position or results of operations.







Item 5. Other Information
(See Note 2  Recent Developments).

20



---



##### Table of Contents









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.

|      |  |  |              |  |  |  |                           |  |  |                                                                                    
|----- |  |  | ------------ |  |  |  | ------------------------- |  |  | -----------------------------------------------------------------------------------
|      |  |  |              |  |  |  | REPUBLIC BANCSHARES, INC.
|     
|Date: |  |  | May 11, 2001 |  |  |  | By:                       |  |  | /s/ William R. Klich                                                               
|      |  |  |              |  |  |  |                           |  |  |                                                                                    
|      |  |  |              |  |  |  |                           |  |  | William R. Klich
President and Chief Executive Officer(principal executive officer)
|     
|Date: |  |  | May 11, 2001 |  |  |  | By:                       |  |  | /s/ William R. Falzone                                                             
|      |  |  |              |  |  |  |                           |  |  |                                                                                    
|      |  |  |              |  |  |  |                           |  |  | William R. Falzone
Treasurer (principal financial andaccounting officer)           

21