<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   ---------

                                  FORM 10-KSB

                 [X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934
                  For the fiscal year ended December 31, 1999

                [_] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
                         OF THE SECURITIES ACT OF 1934.
      or the transition period from _________________ to _________________

                       Commission File Number: 333-19081

                               GBC BANCORP, INC.
                 ----------------------------------------------
                 (Name of small business issuer in its charter)

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              GEORGIA                                           58-2265327
              -------                                           ----------
    (State Other Jurisdiction of                             (I.R.S. Employer
    Incorporation or Organization)                          Identification No.)
           165 Nash Street
       Lawrenceville, Georgia                                     30246
       ----------------------                                     -----
(Address of Principal Executive Offices)                        (Zip Code)
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                                 (770) 995-0000
                ------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)

      Securities registered under Section 12(b) of the Exchange Act: None

      Securities registered under Section 12(g) of the Exchange Act: None*

         *The Issuer filed a Registration Statement on Form SB-2 (Registration
No. 333-19081) effective pursuant to the Securities Act of 1933, as amended, on
April 16, 1997. Accordingly, the Issuer files this report pursuant to Section
15(d) of the Securities Exchange Act of 1934, as amended, and Rule 15d-1 of the
regulations thereunder.

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

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB. [X]

         The Issuer's revenues for the year ended December 31, 1999 were
$4,791,983.

         Aggregate market value of the voting and nonvoting common equity held
by persons other than directors and executive officers of the Registrant
computed by reference to the price at which the common stock was sold, or the
average bid and asked price of such common stock, as of a specific date within
the past 60 days: 8,509,938 based on the average bid and asked price as of
March 28, 2000.

         There were 951,580 shares of the Registrant's common stock outstanding
as of March 30, 2000.

         Transitional Small Business Disclosure Format (check one): Yes [ ]
No [X]

                      DOCUMENTS INCORPORATED BY REFERENCE

         None.


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                               TABLE OF CONTENTS

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                                                                                                              PAGE
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<S>                                                                                                           <C>
PART I...........................................................................................................1
   Item 1. Description of Business...............................................................................1
   Item 2. Description of Property..............................................................................14
   Item 3. Legal Proceedings....................................................................................14
   Item 4. Submission of Matters to a Vote of Security Holders..................................................14
PART II.........................................................................................................14
   Item 5. Market for Common Equity and Related Stockholder Matters.............................................15
   Item 6. Management's Discussion and Analysis of Financial Condition and Results of Operations................15
   Item 7. Financial Statements.................................................................................35
   Item 8. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.................64
PART III........................................................................................................64
   Item 9. Directors and Executive Officers, Promoters and Control Persons; Compliance with
           Section 16(a) of the Exchange Act....................................................................64
   Item 10.Executive Compensation...............................................................................67
   Item 11.Security Ownership of Certain Beneficial Owners and Management.......................................70
   Item 12.Certain Relationships and Related Transactions.......................................................72
   Item 13.Exhibits and Reports on Form 8-K.....................................................................74
   Signatures...................................................................................................77

EXHIBIT INDEX...................................................................................................78
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                                     PART I


ITEM 1.  DESCRIPTION OF BUSINESS

THE COMPANY

         We were organized on August 21, 1996 as a Georgia corporation for the
purpose of acquiring all of the common stock of Gwinnett Banking Company, a
Georgia corporation which opened for business on October 31, 1997 (the "Bank").
We are a bank holding company within the meaning of the Bank Holding Company
Act of 1956, as amended (the "BHC Act"), and the Georgia Bank Holding Company
Act (the "Georgia BHC Act").

         We were organized to facilitate the Bank's ability to serve its
customers' requirements for financial services. The holding company structure
provides flexibility for expansion of our banking business through the possible
acquisition of other financial institutions and the provision of additional
banking-related services which the traditional commercial bank may not provide
under present laws. We have no present plans to acquire any operating
subsidiaries other than the Bank. It is expected, however, that we may make
additional acquisitions in the future if such acquisitions are deemed to be in
the best interest of our shareholders. Such acquisitions, if any, will be
subject to certain regulatory approvals and requirements.

THE BANK

         The Bank is a full service commercial bank located at 165 Nash Street,
Lawrenceville, Gwinnett County, Georgia. The Bank's primary service area is
Gwinnett County, Georgia; however, the Bank also serves the adjacent counties,
or parts thereof, of Cobb, DeKalb and Fulton. The principal business of the
Bank is to accept deposits from the public and to make loans and other
investments. The principal source of funds for the Bank's loans and investments
are demand, time, savings, and other deposits (including negotiable orders of
withdrawal or NOW accounts), amortization and prepayments of loans and
borrowings. The principal sources of income for the Bank are interest and fees
collected on loans, interest and dividends collected on other investments and
service charges. The principal expenses of the Bank are interest paid on
savings and other deposits (including NOW accounts), interest paid on other
borrowings by the Bank, employee compensation, office expenses and other
overhead expenses.

COMPETITION

         We believe that Gwinnett County has a very active and competitive
banking market. The largest financial institutions serving Gwinnett County are
Bank of America, Wachovia Bank, N.A., SunTrust Bank, Atlanta, First Union
National Bank, and SouthTrust Bank, N.A. The largest Gwinnett County based
banks are The Brand Banking Company, Lawrenceville; Peoples Bank & Trust,
Buford; and First Capital Bank, Norcross. Based on the Federal Deposit
Insurance Corporation (the "FDIC") Summary of Deposits as of June 30, 1998,
there are 26 commercial banks, two thrift institutions and three credit unions
that operate 139 offices in


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Gwinnett County. There are approximately 16 financial institutions that have
offices in the immediate vicinity of the main office of the Bank.

EMPLOYEES

         The Bank has 23 full-time employees. We do not have any employees who
are not also employees of the Bank.

SUPERVISION AND REGULATION

         General

         We are a bank holding company registered with the Board of Governors
of the Federal Reserve System (the "Federal Reserve") and the Georgia
Department of Banking and Finance (the "Georgia Department") under the BHC Act
and the Georgia BHC Act, respectively. As such, we are subject to the
supervision, examination and reporting requirements of the BHC Act and the
regulations of the Federal Reserve, and the Georgia BHC Act and the regulations
of the Georgia Department.

         The BHC Act requires every bank holding company to obtain the prior
approval of the Federal Reserve before:

         -        it may acquire direct or indirect ownership or control of any
                  voting shares of any bank if, after such acquisition, the
                  bank holding company will directly or indirectly own or
                  control more than 5% of the voting shares of the bank;

         -        it or any of its subsidiaries, other than a bank, may acquire
                  all or substantially all of the assets of any bank; or

         -        it may merge or consolidate with any other bank holding
                  company.

         The BHC Act further provides that the Federal Reserve may not approve
any transaction that would result in a monopoly or would be in furtherance of
any combination or conspiracy to monopolize or attempt to monopolize the
business of banking in any part of the United States, or the effect of which
may be substantially to lessen competition or to tend to create a monopoly, or
that in any other manner would be in restraint of trade, unless the
anticompetitive effects of the proposed transaction are clearly outweighed by
the public interest in meeting the convenience and needs of the communities to
be served. The Federal Reserve is also required to consider the financial and
managerial resources and future prospects of the bank holding companies and
banks involved and the convenience and needs of the communities to be served.
Consideration of financial resources generally focuses on capital adequacy, and
consideration of convenience and needs issues generally focuses on the parties'
performance under the Community Reinvestment Act of 1977.

         The BHC Act, as amended by the interstate banking provisions of the
Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (the
"Interstate Banking Act"), which


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became effective on September 29, 1995, repealed the prior statutory
restrictions on interstate acquisitions of banks by bank holding companies, and
any other bank holding company located in Georgia, may now acquire a bank
located in any other state, and any bank holding company located outside of
Georgia may lawfully acquire any Georgia-based bank, regardless of state law to
the contrary, in either case subject to certain deposit-percentage, aging
requirements, and other restrictions. The Interstate Banking Act also generally
provides that, as of June 1, 1997, national and state-chartered banks may now
branch interstate through acquisitions of banks in other states.

         In response to the Interstate Banking Act, the Georgia General
Assembly adopted the Georgia Interstate Banking Act which became effective on
July 1, 1995. The Georgia Interstate Banking Act provides that

         -        interstate acquisitions by institutions located in Georgia
                  will be permitted in states which also allow national
                  interstate acquisitions, and

         -        interstate acquisitions of institutions located in Georgia
                  will be permitted by institutions located in states which
                  allow national interstate acquisitions.

         Additionally, on January 26, 1996, the Georgia General Assembly
adopted the Georgia Interstate Branching Act which permits Georgia-based banks
and bank holding companies owning or acquiring banks outside of Georgia and all
non-Georgia banks and bank holding companies owning or acquiring banks in
Georgia the right to merge any lawfully acquired bank into an interstate branch
network. The Georgia Interstate Branching Act also allows banks to establish de
novo branches on a limited basis beginning July 1, 1996. Beginning July 1,
1998, the number of de novo branches which may be established is no longer
limited.

         Except as amended by the Gramm-Leach-Bliley Act of 1999 discussed
below, the BHC Act generally prohibits a bank holding company from engaging in
activities other than banking or managing or controlling banks or other
permissible subsidiaries and from acquiring or retaining direct or indirect
control of any company engaged in any activities other than those activities
determined by the Federal Reserve to be so closely related to banking or
managing or controlling banks as to be a proper incident thereto. In
determining whether a particular activity is permissible, the Federal Reserve
must consider whether the performance of such an activity reasonably can be
expected to produce benefits to the public, such as greater convenience,
increased competition, or gains in efficiency, that outweigh possible adverse
effects, such as undue concentration of resources, decreased or unfair
competition, conflicts of interest, or unsound banking practices. For example,
factoring accounts receivable, acquiring or servicing loans, leasing personal
property, conducting discount securities brokerage activities, performing
certain data processing services, acting as agent or broker in selling credit
life insurance and certain other types of insurance in connection with credit
transactions, and performing certain insurance underwriting activities all have
been determined by the Federal Reserve to be permissible activities of bank
holding companies. The BHC Act does not place territorial limitations on
permissible non-banking activities of bank holding companies. Despite prior
approval, the Federal Reserve has the power to order a bank holding company or
its subsidiaries


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<PAGE>   6


to terminate any activity or to terminate its ownership or control of any
subsidiary when it has reasonable cause to believe that continuation of such
activity or such ownership or control constitutes a serious risk to the
financial safety, soundness, or stability of any bank subsidiary of that bank
holding company.

         The Bank is a member of the FDIC, and as such, its deposits are
insured by the FDIC to the maximum extent provided by law. The Bank is also
subject to numerous state and federal statutes and regulations that affect its
business, activities, and operations, and it is supervised and examined by one
or more state or federal bank regulatory agencies.

         The Bank is subject to regulation, supervision, and examination by the
FDIC and the Georgia Department. The FDIC and the Georgia Department regularly
examine the operations of the Bank and are given authority to approve or
disapprove mergers, consolidations, the establishment of branches, and similar
corporate actions. The FDIC and the Georgia Department also have the power to
prevent the continuance or development of unsafe or unsound banking practices
or other violations of law.

         Certain Conditions

         In connection with their approvals of our formation and the formation
of the Bank, the Georgia Department, the FDIC and the Federal Reserve
conditioned their approvals on the compliance with certain restrictions and
requirements relating to our operations and activities and those of the Bank
(collectively, the "Conditions"), including, without limitation,

         -        a requirement for the Bank to maintain minimum capital of
                  $9,000,000, of which not less than $3,000,000 must be
                  allocated to common capital, not less than $5,100,000 must be
                  allocated to paid in surplus and not less than $900,000 must
                  be allocated as an expense fund to cover pre-opening expenses
                  and potential losses in the Bank's first year of operation;

         -        a requirement for the Bank to maintain a Capital-to-Asset
                  Ratio, as defined by the Georgia Department, at not less than
                  8% during the first three years of operation, and further
                  following this initial three-year period, for the Bank to
                  maintain a Capital-to-Asset Ratio at levels which are
                  consistent with the published policies of the Georgia
                  Department;

         -        a restriction on the payment of dividends to us by the Bank,
                  and on the payment to officers or employees of the Bank of
                  any incentive bonuses until such time as all start-up losses
                  of the Bank are recovered and the Bank has earned a
                  cumulative profit (on both a Bank-only and consolidated
                  basis) and, further, a requirement for the Bank to obtain the
                  approval of the Georgia Department and the Federal Reserve
                  prior to the payment of dividends to us;


                                      -4-
<PAGE>   7


         -        a restriction on the payment by the Bank of any fees to
                  Directors or committee members of the Bank until the Bank has
                  earned a cumulative profit (on both a Bank-only and
                  consolidated basis);

         -        a restriction on changes in the position of President, Chief
                  Lending Officer or Chief Operations Officer of the Bank
                  during the first two years of operation of the Bank without
                  obtaining the prior approval of the Georgia Department and
                  the FDIC;

         -        a restriction on adding any persons to our Board of Directors
                  or the board of Directors of the Bank during the first two
                  years after commencing business without obtaining the prior
                  approval of the Georgia Department;

         -        a restriction on the creation of any plan for the issuance of
                  stock options to key employees and/or officers without
                  obtaining the prior approval of the Georgia Department, which
                  shall include any arrangements for the issuance of stock
                  options included in employment contracts; and

         -        a restriction on us from incurring debt without obtaining the
                  prior approval of the Federal Reserve.

Pursuant to the applicable regulatory approvals, all conditions imposed on the
organizers and Directors of the Bank are imposed on our organizers and
Directors as the holding company for the Bank. Our Board of Directors and the
Board of Directors of the Bank have, in each instance, committed to abide by
each of the Conditions imposed through formal Board action.

         Gramm-Leach-Bliley Act of 1999

         President Clinton signed the Gramm-Leach-Bliley Act of 1999, which
reforms financial services regulation, into law on November 12, 1999. This new
law covers various topics such as insurance, unitary thrifts, privacy
protection provisions for customers of financial institutions, the Federal Home
Loan Bank system's modernization, automatic teller machine reform, the
Community Reinvestment Act and certain changes related to the securities
industry. This new law also eliminates legal barriers to affiliations among
banks and securities firms, insurance companies, and other financial services
companies.

         The Gramm-Leach-Bliley Act amends the Bank Holding Company Act to
clarify that a bank holding company may hold shares of any company that the
Federal Reserve determined, as of the day before the date of enactment of the
Gramm-Leach-Bliley Act, to be engaged in activities that were sufficiently
closely related to banking. This act also amends the Bank Holding Company Act
to establish a new type of bank holding company - the "financial holding
company." Pursuant to the Gramm-Leach-Bliley Act, financial holding companies
have the authority to engage in financial activities in which other bank
holding companies may not engage. Financial holding companies may also
affiliate with companies that are engaged in financial activities. These
financial activities include activities that are:


                                      -5-
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         -        financial in nature;

         -        incidental to an activity that's financial in nature; or

         -        complimentary to a financial activity and does not pose a
                  substantial risk to the safety and soundness of depository
                  institutions or the financial system in general.

The Federal Reserve and the Secretary of the Treasury may determine which
activities meet these standards. However, the Gramm-Leach-Bliley Act lists
certain activities as being financial in nature. For example, some of these
activities are:

         -        lending, exchanging, transferring, investing for others, or
                  safeguarding money or securities;

         -        insuring, guaranteeing, or indemnifying against loss, harm,
                  damage, illness, disability, or death, or providing and
                  issuing annuities, and acting as principal, agent, or broker
                  for these purposes in any state;

         -        providing financial, investment or economic advice;

         -        issuing or selling interests in pools of assets that a bank
                  could hold directly;

         -        underwriting, dealing in or making markets in securities;

         -        engaging in any activity that the Federal Reserve determined
                  by an order or regulation that's in effect on the date of
                  enactment of the Gramm-Leach-Bliley Act to be related closely
                  to banking; and

         -        engaging within the United States in any activity that a bank
                  holding company could engage in outside of the United States,
                  if the Federal Reserve found before the Gramm-Leach-Bliley
                  Act that the activity was usual in connection with banking or
                  other financial operations internationally.

         The Gramm-Leach-Bliley Act also directs the Federal Reserve to adopt a
regulation or order defining certain additional activities as financial in
nature, to the extent that they are consistent with that act. These include:

         -        lending, exchanging, transferring, investing for others or
                  safeguarding financial assets other than money or securities;

         -        providing any device or other instrumentality for
                  transferring financial assets; and

         -        arranging, effecting or facilitating financial transactions
                  for third parties.


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         Not all bank holding companies may become financial holding companies.
A bank holding company must meet three requirements before becoming a financial
holding company:

         -        all of the bank holding company's depository institution
                  subsidiaries must be well capitalized;

         -        all of the bank holding company's depository institution
                  subsidiaries must be well managed; and

         -        the bank holding company must file with the Federal Reserve a
                  declaration of its election to become a financial holding
                  company, including a certification that its depository
                  institution subsidiaries meet the prior two criteria.

With only a few exceptions, in order to exercise the powers granted to them
under the Gramm-Leach-Bliley Act, a financial holding company or insured
depository institution also must meet the Community Reinvestment Act's
requirements. If any insured depository institution, insured depository
institution affiliate, or insured depository institution subsidiary of a
financial holding company did not receive a Community Reinvestment Act rating
of at least "satisfactory record of meeting community credit needs" at its most
recent Community Reinvestment Act examination, the regulatory agencies are to
present the insured depository institution or financial holding company from
exercising the new powers, either directly or through a subsidiary.

         A company that is not a bank holding company not a foreign bank, which
becomes a financial holding company, may be able to continue to engage in
nonfinancial activities and the company may be able to keep its ownership
interests in other companies that are engaged in nonfinancial activities. The
ability to continue the nonfinancial activities or keep ownership interests in
other companies that are engaged in nonfinancial activities lasts for ten years
after the Gramm-Leach-Bliley Act's enactment and may be extended for an
additional five-year term if granted by the Federal Reserve pursuant to an
application. In order to continue in the nonfinancial activities:

         -        the holding company must have been engaged in the
                  nonfinancial activity or held the shares in the other
                  companies engaged in nonfinancial activities on September 30,
                  2000;

         -        the holding company must be predominantly engaged in
                  financial activities; and

         -        the company engaged in the nonfinancial activity must
                  continue to engage in the same nonfinancial activities it did
                  on September 30, 1999 and engage in other authorized
                  activities under the Gramm-Leach-Bliley Act.

         A holding company is predominantly engaged in financial activities
where at least 85% of the consolidated annual gross revenues of the holding
company and its subsidiaries, other than depository institutions, come from
financial activities.


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         Payment of Dividends

         We are a legal entity separate and distinct from our banking
subsidiary. Our principal source of cash flow, including cash flow to pay
dividends to our shareholders, is dividends from the Bank. There are statutory
and regulatory limitations on the payment of dividends by the Bank, as well as
by us to our shareholders.

         If, in the opinion of the federal banking regulators, a depository
institution under its jurisdiction is engaged in or is about to engage in an
unsafe or unsound practice (which, depending on the financial condition of the
depository institution, could include the payment of dividends), such authority
may require, after notice and hearing, that such institution cease and desist
from such practice. The federal banking agencies have indicated that paying
dividends that deplete a depository institution's capital base to an inadequate
level would be an unsafe and unsound banking practice. Under the Federal
Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA"), a depository
institution may not pay any dividend if payment would cause it to become
undercapitalized or if it already is undercapitalized. See "--Prompt Corrective
Action." Moreover, the federal agencies have issued policy statements that
provide that bank holding companies and insured banks should generally only pay
dividends out of current operating earnings.

         Our ability to pay dividends may also be affected or limited by other
factors, such as the requirement to maintain adequate capital above regulatory
guidelines.

         Capital Adequacy

         We are required to comply with the capital adequacy standards
established by the Federal Reserve, and the FDIC in the case of the Bank. There
are two basic measures of capital adequacy for bank holding companies that have
been promulgated by the Federal Reserve: a risk-based measure and a leverage
measure. All applicable capital standards must be satisfied for a bank holding
company to be considered in compliance.

         The risk-based capital standards are designed to make regulatory
capital requirements more sensitive to differences in risk profiles among banks
and bank holding companies, to account for off-balance sheet exposure, and to
minimize disincentives for holding liquid, low-risk assets. Assets and
off-balance-sheet items are assigned to broad risk categories, each with
appropriate weights. The resulting capital ratios represent capital as a
percentage of total risk-weighted assets and off-balance sheet items.

         The minimum guideline for the ratio (the "Total Risk-Based Capital
Ratio") of total capital ("Total Capital") to risk-weighted assets (including
certain off-balance-sheet items, such as standby letters of credit) is 8%. At
least half of Total Capital must be comprised of common stock, undivided
profits, minority interests in the equity accounts of consolidated subsidiaries
and noncumulative perpetual preferred stock, less goodwill and certain other
intangible assets ("Tier 1 Capital"). The remainder may consist of subordinated
debt, other preferred stock, and a limited amount of loan loss reserves ("Tier
2 Capital"). At December 31, 1999, our consolidated


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Total Risk-Based Capital Ratio and its Tier 1 Risk-Based Capital Ratio (i.e.,
the ratio of Tier 1 Capital to risk-weighted assets) were 19.28% and 18.03%,
respectively.

         In addition, the Federal Reserve has established minimum leverage
ratio guidelines for bank holding companies. These guidelines provide for a
minimum ratio (the "Leverage Ratio") of Tier 1 Capital to average assets, less
goodwill and certain other intangible assets, of 3% for bank holding companies
that meet certain specified criteria, including those having the highest
regulatory rating. All other bank holding companies generally are required to
maintain a Leverage Ratio of at least 3%, plus an additional cushion of 100 to
200 basis points. Our Leverage Ratio at December 31, 1999 was 14.98%. The
guidelines also provide that bank holding companies experiencing internal
growth or making acquisitions will be expected to maintain strong capital
positions substantially above the minimum supervisory levels without
significant reliance on intangible assets. Furthermore, the Federal Reserve has
indicated that it will consider a "tangible Tier 1 Capital Leverage Ratio"
(deducting all intangibles) and other indicia of capital strength in evaluating
proposals for expansion or new activities.

         The Bank is subject to risk-based and leverage capital requirements
adopted by the FDIC, which are substantially similar to those adopted by the
Federal Reserve for bank holding companies. The Bank was in compliance with
applicable minimum capital requirements as of December 31, 1999. We have not
been advised by any federal banking agency of any specific minimum capital
ratio requirement applicable to it.

         Failure to meet capital guidelines could subject a bank to a variety
of enforcement remedies, including issuance of a capital directive, the
termination of deposit insurance by the FDIC, a prohibition on the taking of
brokered deposits, and certain other restrictions on its business. As described
below, substantial additional restrictions can be imposed upon FDIC-insured
depository institutions that fail to meet applicable capital requirements. See
"--Prompt Corrective Action."

         The federal bank regulators continue to indicate their desire to raise
capital requirements applicable to banking organizations beyond their current
levels. In this regard, the Federal Reserve and the FDIC have, pursuant to
FDICIA, recently adopted final regulations requiring regulators to consider
interest rate risk (when the interest rate sensitivity of an institution's
assets does not match the sensitivity of its liabilities or its off-balance
sheet position) in the evaluation of a bank's capital adequacy. The bank
regulatory agencies have recently established a methodology for evaluating
interest rate risk which sets forth guidelines for banks with excessive
interest rate risk exposure to hold additional amounts of capital against such
exposures.

         Support of Subsidiary Institution

         Under Federal Reserve policy, we are expected to act as a source of
financial strength for, and to commit resources to support, the Bank. This
support may be required at times when, absent such Federal Reserve policy, we
may not be inclined to provide such support. In addition, any capital loans by
a bank holding company to its banking subsidiary are subordinate in right of
payment to deposits and to certain other indebtedness of such bank. In the
event of a bank holding company's bankruptcy, any commitment by a bank holding
company to a federal bank


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regulatory agency to maintain the capital of a banking subsidiary will be
assumed by the bankruptcy trustee and entitled to a priority of payment.

         Prompt Corrective Action

         FDICIA establishes a system of prompt corrective action to resolve the
problems of undercapitalized institutions. Under this system, which became
effective in December 1992, the federal banking regulators are required to
establish five capital categories (well capitalized, adequately capitalized,
undercapitalized, significantly undercapitalized, and critically
undercapitalized) and to take certain mandatory supervisory actions, and are
authorized to take other discretionary actions, with respect to institutions in
the three undercapitalized categories, the severity of which will depend upon
the capital category in which the institution is placed. Generally, subject to
a narrow exception, FDICIA requires the banking regulator to appoint a receiver
or conservator for an institution that is critically undercapitalized. The
federal banking agencies have specified by regulation the relevant capital
level for each category.

         Under the final agency rules implementing the prompt corrective action
provisions, an institution that (i) has a Total Risk-Based Capital Ratio of 10%
or greater, a Tier 1 Risk-Based Capital Ratio of 6.0% or greater, and a
Leverage Ratio of 5.0% or greater and (ii) is not subject to any written
agreement, order, capital directive, or prompt corrective action directive
issued by the appropriate federal banking agency is deemed to be well
capitalized. An institution with a Total Risk-Based Capital Ratio of 8.0% or
greater, a Tier 1 Risk-Based Capital Ratio of 4.0% or greater, and a Leverage
Ratio of 4.0% or greater is considered to be adequately capitalized. An
institution with a Total Risk-Based Capital Ratio of less than 8.0%, a Tier 1
Risk-Based Capital Ratio of less than 4.0%, or a Leverage Ratio of less than
4.0% is considered to be undercapitalized. An institution with a Total
Risk-Based Capital Ratio of less than 6.0%, a Tier 1 Risk-Based Capital Ratio
of less than 3.0%, or a Leverage Ratio of less than 3.0% is considered to be
significantly undercapitalized, and an institution with a tangible equity
capital to assets ratio equal to or less than 2.0% is deemed to be critically
undercapitalized. For purposes of the regulation, the term "tangible equity"
includes core capital elements counted as Tier 1 Capital for purposes of the
risk-based capital standards, plus the amount of outstanding cumulative
perpetual preferred stock (including related surplus), minus intangible assets
with certain exceptions. A depository institution may be deemed to be in a
capitalization category that is lower than is indicated by its actual capital
position if it receives an unsatisfactory examination rating.

         An institution that is categorized as undercapitalized, significantly
undercapitalized, or critically undercapitalized is required to submit an
acceptable capital restoration plan to its appropriate federal banking agency.
Under FDICIA, a bank holding company must guarantee that a subsidiary
depository institution will meet its capital restoration plan, subject to
certain limitations. The obligation of a controlling bank holding company under
FDICIA to fund a capital restoration plan is limited to the lesser of 5% of an
undercapitalized subsidiary's assets or the amount required to meet regulatory
capital requirements. An undercapitalized institution is also generally
prohibited from increasing its average total assets, making acquisitions,
establishing any branches, or engaging in any new line of business, except in
accordance with an


                                     -10-
<PAGE>   13


accepted capital restoration plan or with the approval of the applicable
agency. In addition, the appropriate federal banking regulator is given
authority with respect to any undercapitalized depository institution to take
any of the actions it is required to or may take with respect to a
significantly undercapitalized institution as described below if it determines
"that those actions are necessary to carry out the purpose" of FDICIA.

         For those institutions that are significantly undercapitalized or
undercapitalized and either fail to submit an acceptable capital restoration
plan or fail to implement an approved capital restoration plan, the appropriate
federal banking agency must require the institution to take one or more of the
following actions: (i) sell enough shares, including voting shares, to become
adequately capitalized; (ii) merge with (or be sold to) another institution (or
holding company), but only if grounds exist for appointing a conservator or
receiver; (iii) restrict certain transactions with banking affiliates as if the
"sister bank" exception to the requirements of Section 23A of the Federal
Reserve Act did not exist; (iv) otherwise restrict transactions with bank or
non-bank affiliates; (v) restrict interest rates that the institution pays on
deposits to "prevailing rates" in the institution's "region"; (vi) restrict
asset growth or reduce total assets; (vii) alter, reduce, or terminate
activities; (viii) hold a new election of directors; (ix) dismiss any director
or senior executive officer who held office for more than 180 days immediately
before the institution became undercapitalized, provided that in requiring
dismissal of a director or senior executive officer, the regulator must comply
with certain procedural requirements, including the opportunity for an appeal
in which the director or officer will have the burden of proving his or her
value to the institution; (x) employ "qualified" senior executive officers;
(xi) cease accepting deposits from correspondent depository institutions; (xii)
divest certain nondepository affiliates which pose a danger to the institution;
or (xiii) be divested by a parent holding company. In addition, without the
prior approval of the appropriate federal banking regulator, a significantly
undercapitalized institution may not pay any bonus to any senior executive
officer or increase the rate of compensation for such an officer, without
regulatory approval.

         At December 31, 1999, the Bank had the requisite capital levels to
qualify as "well capitalized."

         FDIC Insurance Assessments

         Pursuant to FDICIA, the FDIC adopted a risk-based assessment system
for insured depository institutions that takes into account the risks
attributable to different categories and concentrations of assets and
liabilities. The risk-based assessment system, which originally went into
effect on January 1, 1994, assigns an institution to one of three capital
categories: (i) well capitalized; (ii) adequately capitalized; and (iii)
undercapitalized. These three categories are substantially similar to the
prompt corrective action categories described above, with the
"undercapitalized" category including institutions that are undercapitalized,
significantly undercapitalized, and critically undercapitalized for prompt
corrective action purposes. An institution is also assigned by the FDIC to one
of three supervisory subgroups within each capital group. The supervisory
subgroup to which an institution is assigned is based on a supervisory
evaluation provided to the FDIC by the institution's primary federal regulator
and information which the FDIC determines to be relevant to the institution's
financial condition and the risk


                                     -11-
<PAGE>   14


posed to the deposit insurance funds (which may include, if applicable,
information provided by the institution's state supervisor). An institution's
insurance assessment rate is then determined based on the capital category and
supervisory category to which it is assigned. Under the final risk-based
assessment system, there are nine assessment risk classifications (i.e.,
combinations of capital groups and supervisory subgroups) to which different
assessment rates are applied. Assessment rates for members of both the Bank
Insurance Fund ("BIF") and the Savings Association Insurance Fund ("SAIF") for
the first half of 1995, as they had been during 1994, ranged from 23 basis
points (0.23% of deposits) for an institution in the highest category (i.e.,
"well capitalized" and "healthy") to 31 basis points (0.31% of deposits) for an
institution in the lowest category (i.e., "undercapitalized" and "substantial
supervisory concern"). These rates were established for both funds to achieve a
designated ratio of reserves to insured deposits (i.e., 1.25%) within a
specified period of time.

         Once the designated ratio for the BIF was reached in May 1995, the
FDIC reduced the assessment rate applicable to BIF deposits in two stages, so
that, beginning in 1996, the deposit insurance premiums for 92% of all BIF
members in the highest capital and supervisory categories were set at $2,000
per year, regardless of deposit size. The FDIC elected to retain the existing
assessment rate range of 23 to 31 basis points for SAIF members for the
foreseeable future given the undercapitalized nature of that insurance fund.

         Recognizing that the disparity between the SAIF and BIF premium rates
have adverse consequences for the SAIF insured institutions and other banks
with SAIF assessed deposits, including reduced earnings and an impaired ability
to raise funds in capital markets and to attract deposits, in July 1995, the
FDIC, the Treasury Department, and the Office of Thrift Supervision released
statements outlining a proposed plan to recapitalize the SAIF, the principal
feature of which was a special one-time assessment on depository institutions
holding SAIF-insured deposits, which was intended to recapitalize the SAIF at a
reserve ratio of 1.25%. This proposal contemplated elimination of the disparity
between the assessment rates on BIF and SAIF deposits following
recapitalization of the SAIF.

         A variation of this proposal designated the Deposit Insurance Funds
Act of 1996 ("DIFA") was enacted by Congress as part of the omnibus budget
legislation and signed into law on September 30, 1996. As directed by DIFA, the
FDIC implemented a special one-time assessment of approximately 65.7 basis
points (0.657%) on a depository institution's SAIF-insured deposits held as of
March 31, 1995 (or approximately 52.6 basis points on SAIF deposits acquired by
banks in certain qualifying transactions). In addition, the FDIC has
implemented a revision in the SAIF assessment rate schedule which effected, as
of October 1, 1996 (i) a widening in the assessment rate spread among
institutions in the different capital and risk assessment categories, (ii) an
overall reduction of the assessment rate range assessable on SAIF deposits of
from 0 to 27 basis points, and (iii) a special interim assessment rate range
for the last quarter of 1996 of from 18 to 27 basis points on institutions
subject to Financing Corporation ("FICO") assessments. Effective January 1,
1997, assessments to help pay off the $780 million in annual interest payments
on the $8 billion FICO bonds issued in the late 1980's as part of the
government rescue of the thrift industry were imposed on both BIF- and
SAIF-insured deposits in annual amounts presently estimated at 1.29 basis
points and 6.44 basis points, respectively.


                                     -12-
<PAGE>   15


Beginning in January, 2000, BIF- and SAIF-insured institutions share the FICO
interest costs at equal rates currently estimated at 2.43 basis points.

         Under the FDIA, insurance of deposits may be terminated by the FDIC
upon a finding that the institution has engaged in unsafe and unsound
practices, is in an unsafe or unsound condition to continue operations, or has
violated any applicable law, regulation, rule, order, or condition imposed by
the FDIC.

         Safety and Soundness Standards

         The FDIA, as amended by the FDICIA and the Riegle Community
Development and Regulatory Improvement Act of 1994, requires the federal bank
regulatory agencies to prescribe standards, by regulations or guidelines,
relating to internal controls, information systems and internal audit systems,
loan documentation, credit underwriting, interest rate risk exposure, asset
growth, asset quality, earnings, stock valuation and compensation, fees and
benefits, and such other operational and managerial standards as the agencies
deem appropriate. The federal bank regulatory agencies have adopted, effective
August 9, 1995, a set of guidelines prescribing safety and soundness standards
pursuant to FDICIA, as amended. The guidelines establish general standards
relating to internal controls and information systems, internal audit systems,
loan documentation, credit underwriting, interest rate exposure, asset growth,
asset quality, earnings and compensation, fees and benefits. In general, the
guidelines require, among other things, appropriate systems and practices to
identify and manage the risks and exposures specified in the guidelines. The
guidelines prohibit excessive compensation as an unsafe and unsound practice
and describe compensation as excessive when the amounts paid are unreasonable
or disproportionate to the services performed by an executive officer,
employee, director, or principal shareholder. In addition, the agencies adopted
regulations that authorize, but do not require, an agency to order an
institution that has been given notice by an agency that it is not satisfying
any of such safety and soundness standards to submit a compliance plan. If,
after being so notified, an institution fails to submit an acceptable
compliance plan or fails in any material respect to implement an acceptable
compliance plan, the agency must issue an order directing action to correct the
deficiency and may issue an order directing other actions of the types to which
an undercapitalized institution is subject under the "prompt corrective action"
provisions of FDICIA. See "--Prompt Corrective Action." If an institution fails
to comply with such an order, the agency may seek to enforce such order in
judicial proceedings and to impose civil money penalties.

         Community Reinvestment Act

         The Community Reinvestment Act of 1977 ("CRA") requires the federal
bank regulatory agencies to encourage financial institutions to meet the credit
needs of low- and moderate-income borrowers in their local communities. In May
1995, the federal bank regulatory agencies published final amended regulations
promulgated pursuant to the CRA. The final regulations eliminate the 12
assessment factors under the former regulation and replace them with
performance tests. Institutions are no longer required to prepare CRA
Statements or extensively document director participation, marketing efforts or
the ascertainment of community credit


                                     -13-
<PAGE>   16


needs. Under the final rule, an institution's size and business strategy
determines the type of examination that it will receive. Large, retail-oriented
institutions will be examined using a performance-based lending, investment and
service test. Small institutions will be examined using a streamlined approach.
All institutions have the option of being evaluated under a strategic plan
formulated with community input and pre-approved by the bank regulatory agency.

         CRA regulations provide for certain disclosure obligations. In
accordance with the CRA, each institution must post a CRA notice advising the
public of the right to comment to the institution and its regulator on the
institution's CRA performance and to review the institution's CRA public file.
Each lending institution must maintain for public inspection a public file that
includes a listing of branch locations and services, a summary of lending
activity, a map of its communities, and any written comments from the public on
its performance in meeting community credit needs. Public disclosure of written
CRA evaluations of financial institutions made by regulatory agencies is
required by the CRA. This promotes enforcement of CRA requirements by providing
the public with the status of a particular institution's community reinvestment
record.

ITEM 2.  DESCRIPTION OF PROPERTY

         The Bank leases its offices located at 165 Nash Street, Lawrenceville,
Gwinnett County, Georgia.

         We do not invest in real estate, interests in real estate, real estate
mortgages, or securities of or interests in persons primarily engaged in real
estate activities.

ITEM 3.  LEGAL PROCEEDINGS

         None.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         On October 19, 1999, we held our annual shareholders' meeting at which
the shareholders approved a proposal to elect the following directors to serve
until the next annual meeting: James B. Ballard, Jerry M. Boles, W. H. Britt,
Richard F. Combs, William G. Hayes, Larry D. Key, Douglas A. Langley, Norris J.
Nash, Joseph J. Powell and William S. Stanton. This proposal was approved with
641,409 shares or 67.5% voting for the proposal, and no shares withholding
authority or voting against any of the nominees.

         The shareholders also approved a proposal to approve the adoption of
the 1998 Stock Option Plan. This proposal was approved with 596,671 shares or
62.8% voting for the proposal, and 39,038 shares or 6.0% voting against the
proposal.


                                     -14-
<PAGE>   17


                                    PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         There is currently no market for shares of our common stock and it is
not likely that an active trading market will develop for the shares in the
future. There are no present plans for our common stock to be traded on any
stock exchange or over-the-counter market. As of December 31, 1999, there were
174 private trades of shares of our common stock.

         As of December 31, 1999, we had approximately 400 holders of our
common stock.

         We have not paid any dividends to date. Under the Georgia Business
Corporation Code, we may from time to time make distributions, including the
payment of dividends, to its shareholders in money, indebtedness or other
property (except its own shares) unless, after giving effect to such
distribution, we would not be able to pay its debts as they become due in the
usual course of business or our total assets would be less than the sum of its
total liabilities plus the amount that would be needed, if we were to be
dissolved at the time of distribution, to satisfy the preferential rights upon
dissolution of shareholders whose preferential rights are superior to those
receiving the distribution. We may also distribute our shares pro rata and
without consideration to our shareholders or to the shareholders of one or more
classes or series, which constitutes a share dividend.

         Subject to the Conditions, we, as the sole holder of common stock of
the Bank, are entitled to such dividends as may be declared from time to time
by the Board of Directors out of funds legally available therefor. Dividends
paid may not exceed 50% of net profits after taxes for the previous fiscal year
without prior approval of the Department of Banking. The Bank may not pay
cumulative dividends on its common stock.

         In the absence of other activities conducted by us, our ability to pay
dividends will depend upon the earnings of the Bank and fulfillment of the
Conditions. However, we cannot assure the future payment of dividends, either
in cash or in stock.

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

         The following is a discussion of the financial condition of GBC
Bancorp, Inc. (GBC) and its bank subsidiary, Gwinnett Banking Company at
December 31, 1999 and 1998 and the results of operations for the years then
ended. The purpose of this discussion is to focus on information about GBC's
financial condition and results of operations which are not otherwise apparent
from the audited consolidated financial statements. Reference should be made to
those statements and the selected financial data presented elsewhere in this
report for an understanding of the following discussion and analysis.

FORWARD-LOOKING STATEMENTS


                                     -15-
<PAGE>   18


         GBC may from time to time make written or oral forward-looking
statements, including statements contained in GBC's filings with the Securities
and Exchange Commission and its reports to stockholders. Statements made in the
Annual Report, other than those concerning historical information, should be
considered forward-looking and subject to various risks and uncertainties. Such
forward-looking statements are made based upon management's belief as well as
assumptions made by, and information currently available to, management
pursuant to "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. GBC's actual results may differ materially from the results
anticipated in forward-looking statements due to a variety of factors,
including governmental monetary and fiscal policies, deposit levels, loan
demand, loan collateral values, securities portfolio values, interest rate risk
management; the effects of competition in the banking business from other
commercial banks, thrifts, mortgage banking firms, consumer finance companies,
credit unions, securities brokerage firms, insurance companies, money market
funds and other financial institutions operating in GBC's market area and
elsewhere, including institutions operating through the Internet, changes in
governmental regulation relating to the banking industry, including regulations
relating to branching and acquisitions, failure of assumptions underlying the
establishment of reserves for loan losses, including the value of collateral
underlying delinquent loans and other factors. GBC cautions that such factors
are not exclusive. GBC does not undertake to update any forward-looking
statement that may be made from time to time by, or on behalf of, GBC.

OVERVIEW

         GBC's 1999 results were highlighted by reporting of net income of
$445,000 in its second full year of operations and recouping 31% of operating
losses incurred in 1997 and 1998. GBC had significant loan and deposit growth
not uncommon for a de novo bank. This growth provided a base for GBC's first
year of profitability.

FINANCIAL CONDITION AT DECEMBER 31, 1999 AND 1998

Following is a summary of GBC's balance sheets for the years indicated:

<TABLE>
<CAPTION>
                                                                                          December 31,
                                                                                      ---------------------
                                                                                        1999         1998
                                                                                      --------     --------
                                                                                      (DOLLARS IN THOUSANDS)

<S>                                                                                   <C>          <C>
Cash and due from banks.....................................................          $  3,193     $  1,600
Federal funds sold..........................................................             6,650        2,740
Securities..................................................................             6,837        4,009
Loans, net..................................................................            43,612       24,067
Premises and equipment......................................................               491          612
Other assets................................................................             1,549          297
                                                                                      --------     --------

                                                                                      $ 62,332     $ 33,325
                                                                                      ========     ========

Total deposits..............................................................          $ 53,784     $ 25,008
Other liabilities...........................................................               304          263
Stockholders' equity........................................................             8,244        8,054

                                                                                      $ 62,332     $ 33,325
                                                                                      ========     ========
</TABLE>


                                     -16-
<PAGE>   19


FINANCIAL CONDITION AT DECEMBER 31, 1999 AND 1998

         As of December 31, 1999, GBC had total assets of $62.3 million, almost
doubling its asset size as of December 31, 1998. Total interest-earning assets
were $57.1 million at December 31, 1999 or 91.60% of total assets as compared
to 92.47% at December 31, 1998. GBC's primary interest-earning assets at
December 31, 1999 were loans, which made up 76.38% of total interest-earning
assets as compared to 78.10% at December 31, 1998. GBC's loan to deposit ratio
was 81.09% at December 31, 1999 as compared to 97.73% at December 31, 1998.
Deposit growth of $28.8 million has been used primarily to fund loan growth of
$19.5 million.

         GBC's investment portfolio, consisting of U.S. Agency securities,
amounted to $6.8 million at December 31, 1999. Unrealized losses on securities
amounted to $259,000 at December 31, 1999. Management has not specifically
identified any securities for sale in future periods which, if so designated,
would require a charge to operations if the market value would not be
reasonably expected to recover prior to the time of sale.

         GBC has 70% of its loan portfolio collateralized by real estate
located in GBC's primary market area of Gwinnett County and surrounding
counties. GBC's real estate construction portfolio consists of loans
collateralized by loans to build one- to four-family residential properties.
GBC generally requires that loans collateralized by real estate not exceed
80%-85% of the collateral value.

         GBC's remaining 30% of its loan portfolio consists of commercial,
consumer, and other loans. GBC requires collateral commensurate with the
repayment ability and creditworthiness of the borrower.

         The specific economic and credit risks associated with GBC's loan
portfolio, especially the real estate portfolio, include, but are not limited
to, a general downturn in the economy which could affect unemployment rates in
GBC's market area, general real estate market deterioration, interest rate
fluctuations, deteriorated or non-existing collateral, title defects,
inaccurate appraisals, financial deterioration of borrowers, fraud, and any
violation of banking protection laws. Construction lending can also present
other specific risks to the lender such as whether the builders can obtain
financing for the construction, whether the builders can sell the home to a
buyer, and whether the buyer can obtain permanent financing. Currently, real
estate values and employment trends in GBC's market area are stable with no
indications of a significant downturn in the general economy.

         GBC attempts to reduce these economic and credit risks not only by
adherence to loan to value guidelines, but also by investigating the
creditworthiness of the borrower and monitoring the borrower's financial
position. Also, GBC establishes and periodically reviews its lending policies
and procedures as well as having independent loan review. State banking
regulations limit exposure by prohibiting secured loan relationships that
exceed 25% of the Bank's statutory capital and unsecured loan relationships
that exceed 15% of the Bank's statutory capital.


                                     -17-
<PAGE>   20


LIQUIDITY AND CAPITAL RESOURCES

         The purpose of liquidity management is to ensure that there are
sufficient cash flows to satisfy demands for credit, deposit withdrawals, and
other needs of GBC. Traditional sources of liquidity include asset maturities
and growth in core deposits. A company may achieve its desired liquidity
objectives from the management of assets and liabilities and through funds
provided by operations. Funds invested in short-term marketable instruments and
the continuous maturing of other earning assets are sources of liquidity from
the asset perspective. The liability base provides sources of liquidity through
deposit growth, the maturity structure of liabilities, and accessibility to
market sources of funds.

         Scheduled loan payments are a relatively stable source of funds, but
loan payoffs and deposit flows fluctuate significantly, being influenced by
interest rates and general economic conditions and competition. GBC attempts to
price its deposits to meet its asset/liability objectives consistent with local
market conditions.

         The liquidity and capital resources of the Bank are monitored on a
periodic basis by State and Federal regulatory authorities. As determined under
guidelines established by those regulatory authorities and internal policy, the
Bank's liquidity was considered satisfactory.

         At December 31, 1999, GBC had loan commitments outstanding of $22.4
million. Because these commitments generally have fixed expiration dates and
many will expire without being drawn upon, the total commitment amounts do not
necessarily represent future cash requirements. If needed, the Bank has the
ability on a short-term basis to borrow and purchase Federal funds from other
financial institutions. At December 31, 1999, the Bank has arrangements with
three commercial banks for additional short-term advances of $4,500,000.

         At December 31, 1999, GBC's and the Bank's capital ratios were
considered adequate based on regulatory minimum capital requirements. GBC's
stockholders' equity increased due to net income in 1999 of $445,000 and the
exercise of stock options of $13,500. GBC's stockholders' equity decreased due
to unrealized losses on securities available-for-sale of $270,000. For
regulatory purposes, the net unrealized losses on securities available-for-sale
are excluded in the computation of the capital ratios.

         In the future, the primary source of funds available to GBC will be
the payment of dividends by its subsidiary Bank. Banking regulations limit the
amount of the dividends that may be paid without prior approval of the Bank's
regulatory agency. Currently, no dividends can be paid by the Bank to GBC
without regulatory approval.

         The minimum capital requirements to be considered well capitalized
under prompt corrective action provisions and the actual capital ratios for GBC
and the Bank as of December 31, 1999 are as follows:


                                     -18-
<PAGE>   21


<TABLE>
<CAPTION>
                                                                                  Actual
                                                                  --------------------------------------
                                                                                             Regulatory
                                                                    GBC         Bank        Requirements
                                                                  ------       ------       ------------

<S>                                                               <C>          <C>          <C>
Leverage capital ratio......................................      14.98%       14.43%          5.00%
Risk-based capital ratios:
     Core capital...........................................      18.03        17.37           6.00
     Total capital..........................................      19.28        18.63          10.00
</TABLE>

At December 31, 1999, GBC had no material commitments for capital expenditures.

         These ratios should decline as asset growth continues, but will still
remain in excess of the regulatory minimum requirements. Anticipated future
earnings will assist in keeping these ratios at satisfactory levels.

         Management believes that its liquidity and capital resources are
adequate and will meet its foreseeable short and long-term needs. Management
anticipates that it will have sufficient funds available to meet current loan
commitments and to fund or refinance, on a timely basis, its other material
commitments and liabilities.

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

Effects of Inflation

          The impact of inflation on banks differs from its impact on
non-financial institutions. Banks, as financial intermediaries, have assets
which are primarily monetary in nature and which tend to fluctuate in concert
with inflation. A bank can reduce the impact of inflation if it can manage its
rate sensitivity gap. This gap represents the difference between rate sensitive
assets and rate sensitive liabilities. GBC, through its asset-liability
committee, attempts to structure the assets and liabilities and manage the rate
sensitivity gap, thereby seeking to minimize the potential effects of
inflation. For information on the management of GBC's interest rate sensitive
assets and liabilities, see the "Asset/Liability Management" section.

RESULTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998

Following is a summary of GBC's operations for the years indicated.

<TABLE>
<CAPTION>
                                                                                         Years Ended
                                                                                         December 31,
                                                                                    ---------------------
                                                                                     1999           1998
                                                                                    ------         ------
                                                                                    (DOLLARS IN THOUSANDS)

<S>                                                                                 <C>            <C>
Interest income.............................................................        $4,615         $2,484
Interest expense............................................................         1,504            636
Net interest income.........................................................         3,111          1,848

</TABLE>


                                     -19-
<PAGE>   22


<TABLE>

<S>                                                                                  <C>            <C>
Provision for loan losses...................................................           309            344
Other income................................................................           177             86
Other expenses..............................................................         2,534          2,098
Pretax income (loss)........................................................           445           (508)
Income taxes................................................................            --             --
Net income (loss)...........................................................           445           (508)
</TABLE>


                                     -20-
<PAGE>   23


Net Interest Income

         GBC's results of operations are determined by its ability to
effectively manage interest income and expense, to minimize loan and investment
losses, to generate non-interest income, and to control operating expenses.
Since interest rates are determined by market forces and economic conditions
beyond the control of GBC, GBC's ability to generate net interest income is
dependent upon its ability to obtain an adequate net interest spread between
the rate paid on interest-bearing liabilities and the rate earned on
interest-earning assets.

         The net yield on average interest-earning assets was 7.21% in 1999 as
compared to 7.76% in 1998. Average loans increased by $19.8 million which
accounted for the majority of the increase in total average interest-earning
assets. Average interest-bearing liabilities increased by $17.6 million with
average interest-bearing demand and time deposits accounting for the vast
majority of this increase. The rate earned on average interest-earning assets
increased to 10.70% in 1999 from 10.43% in 1998. The rate paid on average
interest-bearing liabilities was 4.96% in 1999 and 4.98% in 1998.

         The net yield on average interest-earning assets was 7.76% in 1998 as
compared to 5.74% in 1997. Average loans increased by $13.5 million which
accounted for the majority of a $21.7 million increase in total average
interest-earning assets. Average interest-bearing liabilities increased by
$12.5 million with average interest-bearing demand and time deposits accounting
for the vast majority of this increase. The rate earned on average
interest-earning assets increased to 10.43% in 1998 from 6.18% in 1997. The
rate paid on average interest-bearing liabilities was 4.98% in 1998 and 3.49%
in 1997.

Provision for Loan Losses

         The provision for loan losses was $309,000 in 1999 as compared to
$344,000 in 1998. The amounts provided were due primarily to the growth of the
portfolio. Based upon management's evaluation of the loan portfolio, management
believes the reserve for loan losses to be adequate to absorb possible losses
on existing loans that may become uncollectible. This evaluation considers past
due and classified loans, underlying collateral values, and current economic
conditions which may affect the borrower's ability to repay. As of December 31,
1999, GBC had nonaccrual loans of $4,000. There were no nonaccrual or impaired
loans at December 31, 1998. The allowance for loan losses as a percentage of
total loans at December 31, 1999 and 1998 was 1.52%. Actual loan charge-offs
were $8,000 during 1999.

Other Income

         Other income consists of service charges on deposit accounts, mortgage
loan origination fees, and other miscellaneous revenue and fees. Other income
increased to $177,000 in 1999 from $86,000 in 1998. This increase is due
primarily to an increase in service charges on deposit accounts of $41,000 and
an increase in mortgage loan origination fees of $23,000.


                                     -21-
<PAGE>   24


         Other income was $86,000 in 1998 as compared to $33,000 in 1997. The
increases are due to GBC being open for an entire year versus only two months
in 1997.

Other Expenses

         Other expenses were $2,534,000 in 1999 as compared to $2,098,000 in
1998, an increase of $436,000. Salaries and employee benefits increased by
$237,000 due to an increase in the number of full time employees from 21 to 23
and normal salary increases. Equipment and occupancy expenses increased by
$267,000 due primarily to increased equipment depreciation of $114,000 and
increased building lease expense of $120,000. GBC, which leases its building
from a partnership formed by GBC's organizers, occupied the building for the
entire year of 1999 as opposed to six months in 1998. Other operating expenses
decreased by $67,000 due primarily to a $100,000 increase in data processing
costs, communication costs, and other taxes, being offset by a decrease of
$167,000 related to the write-off of organization costs.

         Other expenses were $2,098,000 in 1998 as compared to $836,000 in
1997. The increases over 1997 ($519,000 for salaries and employee benefits,
$243,000 for equipment and occupancy, and $333,000 for other operating
expenses) are due primarily to GBC being open for an entire year versus only
two months in 1997. GBC also adopted SOP 98-5 which required the write-off of
$167,000 of organization costs.

Income Tax

         GBC has reported no income tax expense for 1999 and 1998 due to
accumulated net operating losses.

Asset/Liability Management

         It is GBC's objective to manage assets and liabilities to provide a
satisfactory, consistent level of profitability within the framework of
established cash, loan, investment, borrowing, and capital policies. Certain
officers are charged with the responsibility for monitoring policies and
procedures that are designed to ensure acceptable composition of the
asset/liability mix. It is the overall philosophy of management to support
asset growth primarily through growth of core deposits of all categories made
by local individuals, partnerships, and corporations.

         GBC's asset/liability mix is monitored on a regular basis with a
report reflecting the interest rate-sensitive assets and interest
rate-sensitive liabilities being prepared and presented to the Board of
Directors of the Bank on a monthly basis. The objective of this policy is to
monitor interest rate-sensitive assets and liabilities so as to minimize the
impact of substantial movements in interest rates on earnings. An asset or
liability is considered to be interest rate-sensitive if it will reprice or
mature within the time period analyzed, usually one year or less. The interest
rate-sensitivity gap is the difference between the interest-earning assets and
interest-bearing liabilities scheduled to mature or reprice within such time
period. A gap is considered positive when the amount of interest rate-sensitive
assets exceeds the amount of interest rate-sensitive liabilities. A gap is
considered negative when the amount of interest rate-sensitive liabilities
exceeds the interest rate-sensitive assets. During a period of rising interest
rates, a negative gap would tend to adversely affect net interest income, while
a positive gap would tend to result in an increase in net interest income.
Conversely, during a period of falling interest rates, a negative gap would
tend to result in an increase in net interest income, while a positive gap
would tend


                                     -22-
<PAGE>   25


to adversely affect net interest income. If GBC's assets and liabilities were
equally flexible and moved concurrently, the impact of any increase or decrease
in interest rates on net interest income would be minimal.

         A simple interest rate "gap" analysis by itself may not be an accurate
indicator of how net interest income will be affected by changes in interest
rates. Accordingly, GBC also evaluates how the repayment of particular assets
and liabilities is impacted by changes in interest rates. Income associated
with interest-earning assets and costs associated with interest-bearing
liabilities may not be affected uniformly by changes in interest rates. In
addition, the magnitude and duration of changes in interest rates may have a
significant impact on net interest income. For example, although certain assets
and liabilities may have similar maturities or periods of repricing, they may
react in different degrees to changes in market interest rates. Interest rates
on certain types of assets and liabilities fluctuate in advance of changes in
general market rates, while interest rates on other types may lag behind
changes in general market rates. In addition, certain assets, such as
adjustable rate mortgage loans, have features (generally referred to as
"interest rate caps and floors") which limit changes in interest rates.
Prepayment and early withdrawal levels also could deviate significantly from
those assumed in calculating the interest rate gap. The ability of many
borrowers to service their debts also may decrease during periods of rising
interest rates.

         Changes in interest rates also affect GBC's liquidity position. GBC
currently prices deposits in response to market rates and it is management's
intention to continue this policy. If deposits are not priced in response to
market rates, a loss of deposits could occur which would negatively affect
GBC's liquidity position.

         At December 31, 1999, GBC's cumulative one year interest
rate-sensitivity gap ratio was 110%. GBC's targeted ratio is 80% to 120% in
this time horizon. This indicates that GBC's interest-earning assets will
reprice during this period at a rate faster than GBC's interest-bearing
liabilities.

         The following table sets forth the distribution of the repricing of
GBC's interest-earning assets and interest-bearing liabilities as of December
31, 1999, the interest rate-sensitivity gap, the cumulative interest
rate-sensitivity gap, the interest rate-sensitivity gap ratio and the
cumulative interest rate-sensitivity gap ratio. The table also sets forth the
time periods in which earning assets and liabilities will mature or may reprice
in accordance with their contractual terms. However, the table does not
necessarily indicate the impact of general interest rate movements on the net
interest margin since the repricing of various categories of assets and
liabilities is subject to competitive pressures and the needs of GBC's
customers. In addition, various assets and liabilities indicated as repricing
within the same period may in fact, reprice at different times within such
period and at different rates.


                                     -23-
<PAGE>   26


<TABLE>
<CAPTION>
                                                                After Three     After One
                                                 Within        Months but       Year but
                                                 Three         Within One      Within Five       After
                                                 Months         Year             Years         Five Years        Total
                                                --------       ----------      -----------     ----------       --------

<S>                                             <C>            <C>             <C>             <C>              <C>
Interest-earning assets:
   Federal funds sold........................   $  6,650        $     --         $     --        $     --        $  6,650
   Securities................................         --              --            3,931           2,906           6,837
   Loans.....................................     33,370           5,121            4,645           1,150          44,286
                                                --------        --------         --------        --------        --------
                                                  40,020           5,121            8,576           4,056          57,773
                                                ========        ========         ========        ========        ========
Interest-bearing liabilities:
   Interest-bearing demand deposits..........      9,150              --               --              --           9,150
   Savings...................................      3,010              --               --              --           3,010
   Certificates, less than $100,000..........      3,640           8,487            2,666              --          14,793
   Certificates, $100,000 and over...........      5,042          11,750            2,638              --          19,430

                                                  20,842          20,237            5,304              --          46,383
                                                ========        ========         ========        ========        ========

Interest rate sensitivity gap................   $ 19,178        $(15,116)        $  3,272        $  4,056        $ 11,390
Cumulative interest rate sensitivity gap.....   $ 19,178        $  4,062         $  7,334        $ 11,390
Interest rate sensitivity gap ratio..........       1.92             .25             1.62              --
Cumulative interest rate
 sensitivity gap ratio.......................       1.92            1.10             1.16            1.25
</TABLE>


                                     -24-
<PAGE>   27


              SELECTED FINANCIAL INFORMATION AND STATISTICAL DATA

         The tables and schedules on the following pages set forth certain
significant financial information and statistical data with respect to: the
distribution of assets, liabilities and stockholders' equity of GBC, the
interest rates experienced by GBC; the investment portfolio of GBC; the loan
portfolio of GBC, including types of loans, maturities, and sensitivities of
loans to changes in interest rates and information on nonperforming loans;
summary of the loan loss experience and reserves for loan losses of GBC; types
of deposits of GBC and the return on equity and assets for GBC.


                                     -25-
<PAGE>   28


                    DISTRIBUTION OF ASSETS, LIABILITIES, AND
                             STOCKHOLDERS' EQUITY:
                   INTEREST RATES AND INTEREST DIFFERENTIALS

AVERAGE BALANCES

The condensed average balance sheet for the years indicated is presented
below.(1)

<TABLE>
<CAPTION>
                                                                        Years Ended
                                                                        December 31,
                                                                -----------------------------
     ASSETS                                                       1999                 1998
                                                                --------             --------
                                                                    (DOLLARS IN THOUSANDS)

<S>                                                             <C>                  <C>
Cash and due from banks ............................            $  1,841             $  1,041
Taxable securities .................................               5,502                3,323
Securities valuation account .......................                (109)                   3
Federal funds sold .................................               4,063                6,762
Loans(2) ...........................................              33,561               13,744
Allowance for loan losses ..........................                (502)                (194)
Other assets .......................................               1,145                  535

                                                                $ 45,501             $ 25,214
                                                                ========             ========
Total interest-earning assets ......................            $ 43,126             $ 23,829
                                                                ========             ========
     LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
     Noninterest-bearing demand ....................            $  6,824             $  4,031
     Interest-bearing demand .......................               7,568                4,581
     Savings .......................................               3,706                1,847
     Time ..........................................              19,071                6,351

         Total deposits ............................            $ 37,169             $ 16,810

     Other liabilities .............................                 218                  111
         Total liabilities .........................              37,387               16,921
     Stockholders' equity ..........................               8,114                8,293

                                                                $ 45,501             $ 25,214
                                                                ========             ========

Total interest-bearing liabilities .................            $ 30,345             $ 12,779
                                                                ========             ========
</TABLE>

------------

(1)      For each category, average balances were determined using the daily
         average balances during the year for 1999 and 1998.

(2)      The average balance of nonaccrual loans included in average loans for
         1999 was less than $1,000. There were no nonaccrual loans included in
         average loans for 1998.


                                     -26-
<PAGE>   29


INTEREST INCOME AND INTEREST EXPENSE

         The following tables set forth the amount of GBC's interest income and
interest expense for each category of interest-earning assets and
interest-bearing liabilities and the average interest rate for total
interest-earning assets and total interest-bearing liabilities, net interest
spread and net yield on average interest-earning assets.

<TABLE>
<CAPTION>
                                                                              Years Ended December 31,
                                                            -----------------------------------------------------------
                                                                        1999                            1998
                                                            --------------------------       --------------------------
                                                                               Average                          Average
                                                            Interest            Rate         Interest             Rate
                                                            --------           -------       --------           -------
                                                                               (DOLLARS IN THOUSANDS)

<S>                                                          <C>               <C>           <C>                <C>
INTEREST INCOME:
  Interest and fees on loans(1) ....................         $4,066             12.12%         $1,908             13.89%
  Interest on taxable securities ...................            338              6.14             206              6.20
  Interest on Federal funds sold ...................            211              5.19             370              5.47
                                                             ------                            ------
  Total interest income ............................         $4,615             10.70          $2,484             10.43
                                                             ======                            ======

INTEREST EXPENSE:
  Interest on interest-bearing
    demand deposits ................................         $  277              3.67          $  171              3.74%
  Interest on savings deposits .....................            177              4.77              92              5.00
  Interest on time deposits ........................          1,050              5.51             373              5.87
                                                             ------                            ------
  Total interest expense ...........................         $1,504              4.96          $  636              4.98
                                                             ======                            ======

NET INTEREST INCOME ................................         $3,111                            $1,848
  Net interest spread ..............................                             5.74%                             5.45%
  Net yield on average interest-earning assets .....                             7.21%                             7.76%
</TABLE>

------------

(1)      Interest and fees on loans includes $889,000 and $571,000 of loan fee
         income for the years ended December 31, 1999 and 1998, respectively.
         There was no interest income recognized on nonaccrual loans during
         1999 or 1998.

RATE AND VOLUME ANALYSIS

         The following table describes the extent to which changes in interest
rates and changes in volume of interest-earning assets and interest-bearing
liabilities have affected GBC's interest income and expense during the year
indicated. For each category of interest-earning assets and interest-bearing
liabilities, information is provided on changes attributable to (1) change in
volume (change in volume multiplied by old rate); (2) change in rate (change in
rate multiplied by old volume); and (3) a combination of change in rate and
change in volume. The changes in interest income and interest expense
attributable to both volume and rate have been allocated proportionately on a
consistent basis to the change due to volume and the change due to rate.


                                     -27-
<PAGE>   30


<TABLE>
<CAPTION>
                                                                           Years Ended December 31,
                                                              --------------------------------------------------
                                                                        1999                        1998
                                                              ------------------------      --------------------
                                                                                Changes Due to:
                                                                                                       Increase
                                                                Rate                Volume             (Decrease)

                                                                             (DOLLARS IN THOUSANDS)

<S>                                                           <C>                  <C>                  <C>
Increase (decrease) in:
  Income from interest-earning assets:
  Interest and fees on loans .....................            $   (272)            $  2,430             $  2,158
  Interest on taxable securities .................                  (2)                 134                  132
  Interest on Federal funds sold .................                 (18)                (141)                (159)
         Total interest income ...................                (292)               2,423                2,131
                                                              --------             --------             --------

  Expense from interest-bearing liabilities:
  Interest on interest-bearing
    demand deposits ..............................                  (3)                 109                  106
  Interest on savings deposits ...................                  (4)                  89                   85
  Interest on time deposits ......................                 (25)                 702                  677
         Total interest expense ..................                 (32)                 900                  868
                                                              --------             --------             --------

         Net interest income .....................            $   (260)            $  1,523             $  1,263
                                                              ========             ========             ========
</TABLE>


                                     -28-
<PAGE>   31


                              INVESTMENT PORTFOLIO

TYPES OF INVESTMENTS

The carrying amounts of securities at the dates indicated, which are all
classified as available-for-sale, are summarized as follows:

<TABLE>
<CAPTION>
                                                                                          December 31,
                                                                                    ----------------------
                                                                                       1999         1998
                                                                                    ---------     --------
                                                                                    (DOLLARS IN THOUSANDS)

<S>                                                                                 <C>            <C>
U.S. Government agencies....................................................        $  6,837      $  4,009
</TABLE>

MATURITIES

         The amounts of securities in each category as of December 31, 1999 are
shown in the following table according to contractual maturity classifications
(1) one year or less, (2) after one year through five years, (3) after five
years through ten years and (4) after ten years.

<TABLE>
<CAPTION>
                                                                   After one year             After five years
                                    One year or less             through five years           Through ten years
                                  --------------------         ----------------------       --------------------
                                  Yield(1)      Amount         Yield(1)        Amount       Yield(1)      Amount
                                  --------      ------         --------        ------       --------      ------

<S>                               <C>           <C>            <C>            <C>           <C>           <C>
U.S. Government
 Agencies..................       $   -         $   -           5.88%         $ 3,931        7.10%        $ 2,906
</TABLE>

<TABLE>
<CAPTION>
                                     After ten years                    Total
                                  --------------------         ---------------------
                                  Yield(1)      Amount         Yield(1)       Amount
                                  --------      ------         --------       ------

<S>                               <C>           <C>            <C>            <C>
U.S. Government
 Agencies..................       $   -         $   -           6.40%        $ 6,837
</TABLE>

------------

(1)      Yields were computed using coupon interest, adding discount accretion
         or subtracting premium amortization, as appropriate, on a ratable
         basis over the life of each security. The weighted average yield for
         each maturity range was computed using the carrying value of each
         security in that range.


                                     -29-
<PAGE>   32


                                 LOAN PORTFOLIO

TYPES OF LOANS

         The amount of loans outstanding at the indicated dates are shown in
the following table according to the type of loan.

<TABLE>
<CAPTION>
                                                                          December 31,
                                                                -----------------------------
                                                                  1999                 1998
                                                                --------             --------
                                                                     (DOLLARS IN THOUSANDS)

<S>                                                             <C>                  <C>
Commercial .........................................            $  8,662             $  7,275
Construction loans secured by real estate ..........              22,850               13,307
Commercial loans secured by real estate ............               8,237                1,496
Consumer installment loans and other ...............               4,537                2,362
                                                                  44,286               24,440
Less allowance for loan loses ......................                (674)                (373)
     Net Loans .....................................
                                                                $ 43,612             $ 24,067
                                                                ========             ========
</TABLE>

MATURITIES AND SENSITIVITIES OF LOANS TO CHANGES IN INTEREST RATES

Total loans as of December 31, 1999 are shown in the following table according
to contractual maturity classifications (1) one year or less, (2) after one
year through five years, and (3) after five years.

<TABLE>
<CAPTION>
                                                                   (DOLLARS IN THOUSANDS)

<S>                                                                 <C>
Commercial
     One year or less............................................         $11,084
     After one year through five years...........................           4,429
     After five years............................................           1,386
                                                                          -------
                                                                           16,899
Construction
     One year or less............................................          22,517
     After one year through five years...........................             321
     After five years............................................              12
                                                                          -------
                                                                           22,850
Other
     One year or less............................................           3,846
     After one year through five years...........................             682
     After five years............................................               9
                                                                          -------
                                                                            4,537
                                                                          -------
                                                                           44,286
                                                                          =======
</TABLE>


                                     -30-
<PAGE>   33


The following table summarizes loans at December 31, 1999 with the due dates
after one year which have predetermined and floating or adjustable interest
rates.

<TABLE>
<CAPTION>
                                                                        (DOLLARS IN THOUSANDS)

     <S>                                                                <C>
                                                                              $  4,705
     Floating or adjustable interest rates.........................              2,134
                                                                              $  6,839
                                                                              ========
</TABLE>

RISK ELEMENTS

Information with respect to nonaccrual, past due, and restructured loans at
December 31, 1999 and 1998 is as follows:

<TABLE>
<CAPTION>
                                                                       December 31,
                                                                -------------------------
                                                                1999                 1998
                                                                ----                 ----
                                                                  (DOLLARS IN THOUSANDS)

<S>                                                             <C>                  <C>
Nonaccrual loans ...................................            $  4                 $  0
Loans contractually past due ninety days
   or more as to interest or principal
   payments and still accruing .....................               0                    0
Restructured loans .................................               0                    0
Loans, now current about which there are serious
   doubts as to the ability of the borrower to
   comply with loan repayment terms ................              52                    0
Interest income that would have been recorded
   on nonaccrual and restructured loans under
   original terms ..................................               1                    0
Interest income that was recorded on
   Nonaccrual and restructured loans ...............               0                    0
</TABLE>

         It is the policy of the Bank to discontinue the accrual of interest
income when, in the opinion of management, collection of such interest becomes
doubtful. This status is accorded such interest when (1) there is a significant
deterioration in the financial condition of the borrower and full repayment of
principal and interest is not expected and (2) the principal or interest is
more than ninety days past due, unless the loan is both well-secured and in the
process of collection.

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


                                     -31-
<PAGE>   34


                        SUMMARY OF LOAN LOSS EXPERIENCE

The following table summarizes average loan balances for the year determined
using the daily average balances during the period of banking operations;
changes in the allowance for loan losses arising from loans charged off and
recoveries on loans previously charged off; additions to the allowance which
have been charged to operating expense; and the ratio of net charge-offs during
the period to average loans.

<TABLE>
<CAPTION>
                                                                                          December 31,
                                                                                    -----------------------
                                                                                       1999          1998
                                                                                    ---------      --------
                                                                                     (DOLLARS IN THOUSANDS)

<S>                                                                                 <C>            <C>
Average amount of loans outstanding...........................................      $ 33,561       $ 13,744

Balance of allowance for loan losses at beginning of year.....................      $    373       $     29

Loans charged off.............................................................
   Commercial and financial                                                               8              --
   Real estate................................................................           --              --
   Installment................................................................            8              --
                                                                                    -------        --------
                                                                                          8              --

Loans recovered...............................................................
   Commercial and financial...................................................           --              --
   Real estate mortgage.......................................................           --              --
   Installment................................................................           --              --
                                                                                    -------        --------
                                                                                         --              --
   Net charge-offs............................................................            8              --
                                                                                    -------        --------

   Additions to allowance charged to
     operating expense during year............................................          309             344
                                                                                    -------        --------
   Balance of allowance for loan
     losses at end of year....................................................      $   674        $    373
                                                                                    =======        ========
   Ratio of net loans charged off during the year
     to average loans outstanding.............................................      $   .02        $     --%
                                                                                    =======        =======
</TABLE>

ALLOWANCE FOR LOAN LOSSES

         The allowance for loan losses is maintained at a level that is deemed
appropriate by management to adequately cover all known and inherent risks in
the loan portfolio. Management's evaluation of the loan portfolio includes a
periodic review of loan loss experience, current economic conditions which may
affect the borrower's ability to pay and the underlying collateral value of the
loans.


                                     -32-
<PAGE>   35


As of December 31, 1999 and 1998, management had made no allocations of its
allowance for loan losses to specific categories of loans. Based on
management's best estimate, the allocation of the allowance for loan losses to
types of loans, as of the indicated dates, is as follows:

<TABLE>
<CAPTION>
                                                               December 31, 1999                December 31, 1998
                                                              Percent of loans in              Percent of loans in
                                                                each category                    each category
                                                          ---------------------------      ---------------------------
                                                            Amount     to total loans       Amount      to total loans
                                                          ---------    --------------      --------     --------------
                                                                              (DOLLARS IN THOUSANDS)

<S>                                                       <C>          <C>                 <C>          <C>
Commercial..........................................      $     128           19%          $     56            30%
Construction loans secured by real estate...........            351           52                243            54
Commercial loans secured by real estate.............            128           19                 37             6
Consumer installment loans and other................             67           10                 37            10
                                                          ---------         ----           --------          ----
                                                          $     674          100%          $    373           100%
                                                          =========         ====           ========          ====
</TABLE>


                                    DEPOSITS

Average amount of deposits and average rates paid thereon, classified as to
noninterest-bearing demand deposits, interest-bearing demand deposits, savings
deposits, and time deposits is presented below.(1)

<TABLE>
<CAPTION>
                                                                                 Years Ended December 31,
                                                                             1999                      1998
                                                                   -------------------------------------------------
                                                                     Amount       Percent       Amount       Percent
                                                                   ---------      -------     ---------      -------
                                                                                  (DOLLARS IN THOUSANDS)

<S>                                                                <C>            <C>         <C>            <C>
Noninterest-bearing demand deposits..........................      $   6,824          --%     $   4,031         --%
Interest-bearing demand deposits.............................          7,568        3.67          4,581       3.74
Savings deposits.............................................          3,706        4.77          1,847       5.00
Time deposits................................................         19,071        5.51          6.351       5.87
                                                                   ---------                  ---------
                                                                   $  37,169                  $  16,810
                                                                   =========                  =========
</TABLE>

------------

(1)      Average balances were determined using the daily average balances.


                                     -33-
<PAGE>   36


The amounts of time certificates of deposit issued in amounts of $100,000 or
more as of December 31, 1999 are shown below by category, which is based on
time remaining until maturity of (1) three months or less, (2) over three
through six months, (3) over six through twelve months, and (4) over twelve
months.

<TABLE>
<CAPTION>
                                                                                    (DOLLARS IN THOUSANDS)

<S>                                                                                       <C>
Three months or less.........................................................             $   5,143
Over three months through six months.........................................                 6,696
Over six through twelve months...............................................                 5,054
Over twelve months...........................................................                 2,638
                                                                                          ---------

         Total...............................................................             $  19,531
                                                                                          =========
</TABLE>

                   RETURN ON ASSETS AND STOCKHOLDERS' EQUITY

The following rate of return information for the years indicated is presented
below.

<TABLE>
<CAPTION>
                                                                                             December 31,
                                                                                        ---------------------
                                                                                         1999           1998
                                                                                        ------         ------
                                                                                       (DOLLARS IN THOUSANDS)

<S>                                                                                     <C>            <C>
Return on assets(1)..........................................................             .98%         (2.01)%
Return on equity(2)..........................................................            5.48          (6.12)
Dividend payout ratio(3).....................................................              --             --
Equity to assets ratio(4)....................................................           17.83          32.89
</TABLE>

------------

(1)       Net income (loss) divided by average total assets.
(2)       Net income (loss) divided by average equity.
(3)       Dividends declared per share of common stock divided by net income
          (loss) per share.
(4)       Average common equity divided by average total assets.



ITEM 7.  FINANCIAL STATEMENTS
<PAGE>   37





                                GBC BANCORP, INC.
                                 AND SUBSIDIARY

                          CONSOLIDATED FINANCIAL REPORT

                                DECEMBER 31, 1999














                                      35
<PAGE>   38


                                GBC BANCORP, INC.
                                 AND SUBSIDIARY

                          CONSOLIDATED FINANCIAL REPORT
                                DECEMBER 31, 1999


                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                          PAGE
                                                                          ----

<S>                                                                       <C>
INDEPENDENT AUDITOR'S REPORT................................................37

FINANCIAL STATEMENTS

     CONSOLIDATED BALANCE SHEETS............................................38
     CONSOLIDATED STATEMENTS OF OPERATIONS..................................39
     CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS).................40
     CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY .......................41
     CONSOLIDATED STATEMENTS OF CASH FLOWS..................................42
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS..........................43-63
</TABLE>



                                      36

<PAGE>   39



                          INDEPENDENT AUDITOR'S REPORT



To the Board of Directors
GBC Bancorp, Inc.
Lawrenceville, Georgia


                  We have audited the accompanying consolidated balance sheets
of GBC Bancorp, Inc. and subsidiary as of December 31, 1999 and 1998, and the
related consolidated statements of operations, comprehensive income (loss),
stockholders' equity, and cash flows for the years then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.


                  We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.


                  In our opinion, the consolidated financial statements referred
to above present fairly, in all material respects, the financial position of GBC
Bancorp, Inc. and subsidiary as of December 31, 1999 and 1998, and the results
of their operations and their cash flows for the years then ended, in conformity
with generally accepted accounting principles.



                                    /S/ MAULDIN & JENKINS, LLC



Atlanta, Georgia
March 2, 2000



                                      37
<PAGE>   40



                                GBC BANCORP, INC.
                                 AND SUBSIDIARY

                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 1999 AND 1998

<TABLE>
<CAPTION>
                                  ASSETS                              1999             1998
                                                                   -----------      -----------

<S>                                                                <C>              <C>
Cash and due from banks                                            $ 3,192,647      $ 1,600,046
Federal funds sold                                                   6,650,000        2,740,000
Securities available-for-sale                                        6,836,993        4,008,520

Loans                                                               44,285,792       24,439,863
Less allowance for loan losses                                         674,143          372,683
                                                                   -----------      -----------
        Loans, net                                                  43,611,649       24,067,180

Equipment                                                              491,628          612,166
Other assets                                                         1,548,909          296,928
                                                                   -----------      -----------

        Total assets                                               $62,331,826      $33,324,840
                                                                   ===========      ===========

                 LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits
    Noninterest-bearing demand                                     $ 7,310,817      $ 5,311,665
    Interest-bearing demand                                          9,149,735        6,808,561
    Savings                                                          3,099,601        3,473,772
    Time, $100,000 and over                                         19,530,671        5,544,381
    Other time                                                      14,693,018        3,869,148
                                                                   -----------      -----------
        Total deposits                                              53,783,842       25,007,527
    Other liabilities                                                  304,077          263,047
                                                                   -----------      -----------
        Total liabilities                                           54,087,919       25,270,574
                                                                   -----------      -----------

Commitments and contingent liabilities

Stockholders' equity
Common stock, par value $1; 3,000,000 shares authorized;
    951,580 and 950,080 issued and outstanding, respectively           951,580          950,080
Capital surplus                                                      8,540,327        8,526,827
Accumulated deficit                                                   (989,210)      (1,434,200)
Accumulated other comprehensive income (loss)                         (258,790)          11,559
                                                                   -----------      -----------

        Total stockholders' equity                                   8,243,907        8,054,266
                                                                   -----------      -----------

        Total liabilities and stockholders' equity                 $62,331,826      $33,324,840
                                                                   ===========      ===========
</TABLE>

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      38
<PAGE>   41


                                GBC BANCORP, INC.
                                 AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                     YEARS ENDED DECEMBER 31, 1999 AND 1998

<TABLE>
<CAPTION>
                                                                    1999             1998
                                                                 ----------      -----------
<S>                                                              <C>             <C>
Interest income
   Loans                                                         $4,066,177      $ 1,908,548
   Taxable securities                                               337,830          206,090
   Federal funds sold                                               210,913          369,851
                                                                 ----------      -----------
       Total interest income                                      4,614,920        2,484,489

Interest expense on deposits                                      1,504,334          636,249
                                                                 ----------      -----------

       Net interest income                                        3,110,586        1,848,240
Provision for loan losses                                           309,161          343,987
                                                                 ----------      -----------
       Net interest income after provision for
         loan losses                                              2,801,425        1,504,253
                                                                 ----------      -----------

Other income
  Service charges on deposit accounts                                66,863           25,630
  Other operating income                                            110,200           60,645
                                                                 ----------      -----------
       Total other income                                           177,063           86,275
                                                                 ----------      -----------

Other expenses
  Salaries and employee benefits                                  1,390,288        1,154,611
  Equipment and occupancy expenses                                  593,637          327,031
  Other operating expenses                                          549,573          449,770
                                                                 ----------      -----------
       Total other expenses                                       2,533,498        1,931,412
                                                                 ----------      -----------

       Income (loss) before income taxes and cumulative
         effect of a change in accounting principle                 444,990         (340,884)

Income tax expense                                                       --               --
                                                                 ----------      -----------

       Income (loss) before cumulative effect of a
         change in accounting principle                             444,990         (340,884)

Cumulative effect of a change in accounting principle                    --         (166,884)
                                                                 ----------      -----------

             Net income (loss)                                   $  444,990      $  (507,768)
                                                                 ==========      ===========

Basic and diluted earnings (losses) per common share before
  cumulative effect of a change in accounting principle          $     0.47      $     (0.36)

Cumulative effect of a change in accounting principle                  0.00            (0.17)
                                                                 ----------      -----------

Basic and diluted earnings (losses) per common share             $     0.47      $     (0.53)
                                                                 ==========      ===========
</TABLE>

See Notes to Consolidated Financial Statements.


                                      39
<PAGE>   42


                                GBC BANCORP, INC.
                                 AND SUBSIDIARY

             CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
                     YEARS ENDED DECEMBER 31, 1999 AND 1998


<TABLE>
<CAPTION>
                                                            1999            1998
                                                         ---------       ---------

<S>                                                      <C>             <C>
Net income (loss)                                        $ 444,990       $(507,768)

Other comprehensive income (loss):

    Unrealized holding gains (losses) on securities
      available-for-sale arising during period            (270,349)         11,559
                                                         ---------       ---------

Comprehensive income (loss)                              $ 174,641       $(496,209)
                                                         =========       =========
</TABLE>


SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      40
<PAGE>   43



                                GBC BANCORP, INC.
                                 AND SUBSIDIARY

                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                     YEARS ENDED DECEMBER 31, 1999 AND 1998


<TABLE>
<CAPTION>
                                                                                     ACCUMULATED
                                       COMMON STOCK                                     OTHER           TOTAL
                                    ------------------    CAPITAL     ACCUMULATED   COMPREHENSIVE   STOCKHOLDERS'
                                    SHARES   PAR VALUE    SURPLUS       DEFICIT     INCOME (LOSS)       EQUITY
                                    -------  ---------   ----------   -----------   -------------   -------------

<S>                                 <C>      <C>         <C>          <C>           <C>             <C>
BALANCE, DECEMBER 31, 1997          950,080  $950,080    $8,526,827   $  (926,432)    $      --     $ 8,550,475
    Net loss                             --        --            --      (507,768)           --       (507,768)
    Other comprehensive income           --        --            --            --        11,559          11,559
                                    -------  --------    ----------   -----------     ---------     -----------
BALANCE, DECEMBER 31, 1998          950,080  $950,080    $8,526,827   $(1,434,200)    $  11,559     $ 8,054,266
    Net income                           --        --            --       444,990            --         444,990
    Exercise of stock options         1,500     1,500        13,500            --            --          15,000
    Other comprehensive (loss)           --        --            --            --      (270,349)       (270,349)
                                    -------  --------    ----------   -----------     ---------     -----------
BALANCE, DECEMBER 31, 1999          951,580  $951,580    $8,540,327   $  (989,210)    $(258,790)    $ 8,243,907
                                    =======  ========    ==========   ===========     =========     ===========
</TABLE>

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.



                                      41
<PAGE>   44

                                GBC BANCORP, INC.
                                 AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                     YEARS ENDED DECEMBER 31, 1999 AND 1998

<TABLE>
<CAPTION>
                                                                           1999                   1998
                                                                      ------------           ------------
<S>                                                                   <C>                    <C>
OPERATING ACTIVITIES
  Net income (loss)                                                   $    444,990           $   (507,768)
  Adjustments to reconcile net income (loss) to net cash
    provided by operating activities:
    Depreciation                                                           213,763                117,320
    Deferred income taxes                                                  (49,949)                    --
    Write-off of organization costs                                             --                166,884
    Provision for loan losses                                              309,161                343,987
    Increase in interest receivable                                       (176,295)              (240,513)
    Increase in interest payable                                             9,423                196,546
    Other operating activities                                             (61,130)                25,336
                                                                      ------------           ------------

        Net cash provided by operating activities                          689,963                101,792
                                                                      ------------           ------------

INVESTING ACTIVITIES
  Purchases of securities available-for-sale                            (6,594,906)            (4,496,563)
  Proceeds from maturities of securities available-for-sale              3,496,084                499,602
  Net (increase) decrease in Federal funds sold                         (3,910,000)             6,960,000
  Net increase in loans                                                (19,853,630)           (22,569,394)
  Purchase of equipment                                                    (93,225)              (590,393)
  Purchase of life insurance policies                                     (933,000)                    --
                                                                      ------------           ------------

        Net cash used in investing activities                          (27,888,677)           (20,196,748)
                                                                      ------------           ------------

FINANCING ACTIVITIES
  Net increase in deposits                                              28,776,315             20,735,885
  Proceeds from exercise of stock options                                   15,000                     --
                                                                      ------------           ------------

        Net cash provided by financing activities                       28,791,315             20,735,885
                                                                      ------------           ------------

Net increase in cash and due from banks                                  1,592,601                640,929

Cash and due from banks at beginning of year                             1,600,046                959,117
                                                                      ------------           ------------

Cash and due from banks at end of year                                $  3,192,647           $  1,600,046
                                                                      ============           ============

SUPPLEMENTAL DISCLOSURES
   Cash paid for:
        Interest                                                      $  1,494,911           $    439,703

        Income taxes                                                  $     80,000           $         --

NONCASH TRANSACTION
  Unrealized (gains) losses on securities available-for-sale          $    270,349           $    (11,559)
</TABLE>


SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      42
<PAGE>   45



                                GBC BANCORP, INC.
                                 AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS





NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        NATURE OF BUSINESS

         GBC Bancorp, Inc. (the "Company") is a bank holding company whose
         business is conducted by its wholly-owned subsidiary, Gwinnett Banking
         Company (the "Bank"). The Bank is a commercial bank located in
         Lawrenceville, Gwinnett County, Georgia. The Bank provides a full range
         of banking services in its primary market area of Gwinnett County and
         surrounding counties.

        BASIS OF PRESENTATION

         The consolidated financial statements include the accounts of the
         Company and its subsidiary. Significant intercompany transactions and
         accounts are eliminated in consolidation.

         The preparation of financial statements in conformity with generally
         accepted accounting principles requires management to make estimates
         and assumptions that affect the reported amounts of assets and
         liabilities and disclosures of contingent assets and liabilities as of
         the balance sheet date and the reported amounts of revenues and
         expenses during the reporting period. Actual results could differ from
         those estimates. Material estimates that are particularly susceptible
         to significant change in the near term relate to the determination of
         the allowance for loan losses and deferred tax assets.

        CASH AND DUE FROM BANKS

         Cash on hand, cash items in process of collection, and amounts due from
         banks are included in cash and due from banks.

         The Company maintains amounts due from banks which, at times, may
         exceed Federally insured limits. The Company has not experienced any
         losses in such accounts.


                                       43
<PAGE>   46




                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

        SECURITIES

         Securities are classified based on management's intention on the date
         of purchase. Securities which management has the intent and ability to
         hold to maturity would be classified as held-to-maturity and recorded
         at amortized cost. Currently, all securities are classified as
         available-for-sale and recorded at fair value with net unrealized gains
         and losses reported in other comprehensive income.

         Interest and dividends on securities, including amortization of
         premiums and accretion of discounts, are included in interest income.
         Realized gains and losses from the sale of securities are determined
         using the specific identification method.

        LOANS

         Loans are reported at their outstanding principal balances less
         deferred fees and the allowance for loan losses. Interest income is
         accrued based on the principal balance outstanding.

         Nonrefundable loan fees and costs incurred for loans are deferred and
         recognized in income over the estimated life of the loans.

         The allowance for loan losses is maintained at a level that management
         believes to be adequate to absorb potential losses in the loan
         portfolio. Loan losses are charged against the allowance when
         management believes the uncollectibility of a loan is confirmed.
         Subsequent recoveries are credited to the allowance. Management's
         determination of the adequacy of the allowance is based on an
         evaluation of the portfolio, past loan loss experience, current
         economic conditions, volume, growth, composition of the loan portfolio,
         and other risks inherent in the portfolio. This evaluation is
         inherently subjective as it requires material estimates that are
         susceptible to significant change including the amounts and timing of
         future cash flows expected to be received on impaired loans. In
         addition, regulatory agencies, as an integral part of their examination
         process, will periodically review the Company's allowance for loan
         losses, and may require the Company to record additions to the
         allowance based on their judgment about information available to them
         at the time of their examinations.

         The accrual of interest on loans is discontinued when, in management's
         opinion, the borrower may be unable to meet payments as they become
         due. When accrual of interest is discontinued, all unpaid accrued
         interest is reversed. Interest income is subsequently recognized only
         to the extent cash payments are received.


                                       44
<PAGE>   47





                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

        LOANS (CONTINUED)

         A loan is impaired when it is probable the Company will be unable to
         collect all principal and interest payments due in accordance with the
         contractual terms of the loan agreement. Individually identified
         impaired loans are measured based on the present value of payments
         expected to be received, using the contractual loan rate as the
         discount rate. Alternatively, measurement may be based on observable
         market prices or, for loans that are solely dependent on the collateral
         for repayment, measurement may be based on the fair value of the
         collateral. If the recorded investment in the impaired loan exceeds the
         measure of fair value, a valuation allowance is established as a
         component of the allowance for loan losses. Changes to the valuation
         allowance are recorded as a component of the provision for loan losses.

        EQUIPMENT

         Equipment is carried at cost less accumulated depreciation.
         Depreciation is computed principally by the straight-line method over
         the estimated useful lives of the assets.

        INCOME TAXES

         Income tax expense consists of current and deferred taxes. Current
         income tax provisions approximate taxes to be paid or refunded for the
         applicable year. Deferred income tax assets and liabilities are
         determined using the balance sheet method. Under this method, the net
         deferred tax asset or liability is determined based on the tax effects
         of the differences between the book and tax bases of the various
         balance sheet assets and liabilities and gives current recognition to
         changes in tax rates and laws.

         Recognition of deferred tax balance sheet amounts is based on
         management's belief that it is more likely than not that the tax
         benefit associated with certain temporary differences will be realized.
         A valuation allowance is recorded for those deferred tax items for
         which it is more likely than not that realization will not occur in the
         near term.

         The Company and the Bank file a consolidated income tax return. Each
         entity provides for income taxes based on its contribution to income
         taxes (benefits) of the consolidated group.


                                       45
<PAGE>   48





                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

        EARNINGS (LOSSES) PER COMMON SHARE

         Basic earnings (losses) per common share are computed by dividing net
         income (loss) by the weighted average number of shares of common stock
         outstanding. Diluted earnings (losses) per share are computed by
         dividing net income (loss) by the sum of the weighted-average number of
         shares of common stock outstanding and potential common shares.
         Potential common shares consist of stock options.

        CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLE

         In April of 1998, the Accounting Standards Executive Committee issued
         Statement of Position ("SOP") 98-5, "Reporting on the Costs of Start Up
         Activities". SOP 98-5 requires that costs of start-up activities and
         organization costs be expensed as incurred. SOP 98-5 became effective
         for financial statements for fiscal years beginning after December 15,
         1998. However, early adoption was encouraged for fiscal years in which
         financial statements had not been issued. During 1998, the Company
         wrote off $166,884 of unamortized organization costs upon adoption of
         SOP 98-5. Prior to the adoption of SOP 98-5, the Company was amortizing
         these costs over a five year period.

        COMPREHENSIVE INCOME

         Statement of Financial Accounting Standards ("SFAS") No. 130,
         ("Reporting Comprehensive Income"), describes comprehensive income as
         the total of all components of comprehensive income, including net
         income. Other comprehensive income refers to revenues, expenses, gains
         and losses that under generally accepted accounting principles are
         included in comprehensive income but excluded from net income.
         Currently, the Company's other comprehensive income consists of
         unrealized gains and losses on available-for-sale securities.

        RECLASSIFICATIONS

         Certain items of other expenses in the statement of operations for the
         year ended December 31, 1998 have been reclassified to be consistent
         with classifications adopted for the year ended December 31, 1999.


                                       46
<PAGE>   49





                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

        RECENT ACCOUNTING PRONOUNCEMENTS

         In June 1998, Financial Accounting Standards Board issued SFAS No. 133,
         "Accounting for Derivative Instruments and Hedging Activities". The
         effective date of this statement has been deferred by SFAS No. 137
         until fiscal years beginning after June 15, 2000. However, the
         statement permits early adoption as of the beginning of any fiscal
         quarter after its issuance. The Company expects to adopt this statement
         effective January 1, 2001. SFAS No. 133 requires the Company to
         recognize all derivatives as either assets or liabilities in the
         balance sheet at fair value. For derivatives that are not designated as
         hedges, the gain or loss must be recognized in earnings in the period
         of change. For derivatives that are designated as hedges, changes in
         the fair value of the hedged assets, liabilities, or firm commitments
         must be recognized in earnings or recognized in other comprehensive
         income until the hedged item is recognized in earnings, depending on
         the nature of the hedge. The ineffective portion of a derivative's
         change in fair value must be recognized in earnings immediately.
         Management does not believe the adoption of SFAS No. 133 will have a
         significant effect on the Company's earnings or financial position.

         There are no other recent accounting pronouncements that have had, or
         are expected to have, a material effect on the Company's financial
         statements.


NOTE 2. SECURITIES

         The amortized cost and fair value of securities are summarized as
         follows:

<TABLE>
<CAPTION>
                                                                                   GROSS             GROSS
                                               AMORTIZED         UNREALIZED      UNREALIZED          FAIR
                                                 COST              GAINS           LOSSES            VALUE
                                              -----------       -----------      ----------       ----------

         <S>                                  <C>               <C>              <C>              <C>
         SECURITIES AVAILABLE-FOR-SALE
           DECEMBER 31, 1999:
           U.S. GOVERNMENT AND
              AGENCY SECURITIES               $ 7,095,783               --       $  (258,790)     $ 6,836,993
                                              ===========        ==========      ===========      ===========

         SECURITIES AVAILABLE-FOR-SALE
           DECEMBER 31, 1998:
           U.S. GOVERNMENT AND
              AGENCY SECURITIES               $ 3,996,961        $   11,559      $        --      $ 4,008,520
                                              ===========        ==========      ===========      ===========
</TABLE>


                                       47
<PAGE>   50



                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




NOTE 2.  SECURITIES (CONTINUED)

         The amortized cost and fair value of securities as of December 31, 1999
         by contractual maturity are shown below.

<TABLE>
<CAPTION>
                                                    AMORTIZED        FAIR
                                                       COST          VALUE
                                                   -----------    -----------

             <S>                                   <C>            <C>
             Due from one year to five years       $ 4,095,783    $ 3,930,526
             Due from five years to ten years        3,000,000      2,906,447
                                                   -----------   ------------
                                                   $ 7,095,783    $ 6,836,993
                                                   ===========   ============
</TABLE>

         Securities with a carrying value of $486,565 and $500,000 at December
         31, 1999 and 1998, respectively, were pledged to secure public deposits
         and for other purposes.


NOTE 3.  LOANS AND ALLOWANCE FOR LOAN LOSSES

<TABLE>
<CAPTION>
                                                                 DECEMBER 31,
                                                             1999           1998
                                                         -------------  -------------

          <S>                                            <C>             <C>
          Commercial                                     $   8,662,176   $  7,275,141
          Commercial loans secured by real estate            8,384,203      1,606,074
          Construction loans secured by real estate         22,850,298     13,307,286
          Consumer installment and other                     4,536,847      2,361,648
                                                         -------------   ------------
                                                            44,433,524     24,550,149
          Deferred fees                                       (147,732)      (110,286)
          Allowance for loan losses                           (674,143)      (372,683)
                                                         -------------   ------------
          Loans, net                                     $  43,611,649   $ 24,067,180
                                                         =============   ============
</TABLE>


                                       48
<PAGE>   51




                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 3.  LOANS AND ALLOWANCE FOR LOAN LOSSES (CONTINUED)

         Changes in the allowance for loan losses are as follows:

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

                   <S>                                                 <C>                <C>
                   BALANCE, BEGINNING OF YEAR                          $      372,683    $        28,696
                      Provision for loan losses                               309,161            343,987
                      Loans charged off                                        (7,701)                --
                      Recoveries of loans previously charged off                   --                 --
                                                                       --------------    ---------------
                   BALANCE, END OF YEAR                                $      674,143    $       372,683
                                                                       ==============    ===============
</TABLE>

               The total recorded investment in impaired loans was $63,097 at
         December 31, 1999. There were no impaired loans that had related
         allowances for loan losses determined in accordance with SFAS No. 114,
         ("Accounting by Creditors for Impairment of a Loan"), at December 31,
         1999. The average recorded investment in impaired loans for 1999 was
         $56,631. Interest income recognized on impaired loans for cash payments
         received was not material for the year ended 1999. Management had
         identified no amounts of impaired loans in 1998.

               The Company has granted loans to certain directors, executive
         officers, and their related entities. The interest rates on these loans
         were substantially the same as rates prevailing at the time of the
         transaction and repayment terms are customary for the type of loan
         involved. Changes in related party loans for the year ended December
         31, 1999 are as follows:

<TABLE>
                           <S>                                <C>
                           BALANCE, BEGINNING OF YEAR         $      2,285,643
                              Advances                               2,330,778
                              Repayments                            (1,360,092)
                                                              ----------------
                           BALANCE, END OF YEAR               $      3,256,329
                                                              ================
</TABLE>

NOTE 4.  EQUIPMENT

         Equipment is summarized as follows:

<TABLE>
<CAPTION>
                                                             DECEMBER 31,
                                                  -------------------------------
                                                        1999              1998
                                                  -------------    --------------

                  <S>                             <C>              <C>
                  Equipment                       $     827,937    $      734,712
                  Accumulated depreciation             (336,309)         (122,546)
                                                  -------------    --------------
                                                  $     491,628    $      612,166
                                                  =============    ==============
</TABLE>


                                       49
<PAGE>   52

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 5.  DEPOSITS

         The scheduled maturities of time deposits at December 31, 1999 are as
         follows:

<TABLE>
                      <S>                              <C>
                      2000                             $     28,908,361
                      2001                                    4,443,035
                      2002                                      148,418
                      2003                                      723,875
                                                       ----------------
                                                       $     34,223,689
                                                       ================
</TABLE>

         The Company had related party deposits of $2,549,876 and $2,134,156 at
         December 31, 1999 and 1998, respectively.


NOTE 6.  DEFERRED COMPENSATION PLAN

         In 1999, the Company established a deferred compensation plan providing
         for death and retirement benefits for its directors and executive
         officers. The estimated amounts to be paid under the compensation plan
         have been funded through the purchase of life insurance policies on the
         directors and executive officers. The balance of the policy cash
         surrender values included in other assets at December 31, 1999 is
         $935,494. Income recognized on the policies amounted to $2,494 for the
         year ended December 31, 1999. There was no deferred compensation
         liability or expense recognized as of and for the year ended December
         31, 1999.


NOTE 7.  INCOME TAXES

         Income tax expense consists of the following:

<TABLE>
<CAPTION>
                                                                                              YEARS ENDED DECEMBER 31,
                                                                                         -----------------------------------
                                                                                               1999                1998
                                                                                         ---------------     ---------------
                      <S>                                                                <C>                 <C>
                      Current                                                            $       175,471      $      (65,289)
                      Deferred                                                                   (31,629)           (107,012)
                      Change in valuation allowance                                             (143,842)            172,301
                                                                                         ---------------     ---------------
                      Income tax expense                                                 $            --      $           --
                                                                                         ===============     ===============
</TABLE>



                                       50
<PAGE>   53

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7.  INCOME TAXES (CONTINUED)

         The Company's income tax expense differs from the amounts computed by
         applying the Federal income tax statutory rates to income before income
         taxes. A reconciliation of the differences is as follows:
<TABLE>
<CAPTION>
                                                                   YEARS ENDED DECEMBER 31,
                                                ----------------------------------------------------------
                                                             1999                          1998
                                                ---------------------------     --------------------------
                                                  AMOUNT          PERCENT        AMOUNT          PERCENT
                                                ----------       ----------     ----------      ----------

         <S>                                    <C>              <C>            <C>             <C>
         Income taxes at statutory rate         $  151,297               34%    $ (172,641)            (34)%
         Change in valuation allowance            (143,842)             (32)       172,301              34
                                                    (7,455)              (2)           340              --
                                                ----------       ----------     ----------      ----------
         Other                                  $       --               --%    $       --              --%
                                                ==========       ==========     ==========      ==========
</TABLE>

         The components of deferred income taxes are as follows:

<TABLE>
<CAPTION>
                                                                DECEMBER 31,
                                                        ----------------------------
                                                          1999              1998
                                                        ---------          ---------

         <S>                                            <C>                <C>
         Deferred tax assets:
           Loan loss reserves                           $ 175,168          $  88,310
           Loan fees                                       50,229             37,497
           Preopening and organization expenses           181,382            245,344
           Net operating loss carryforward                     --            125,522
           Securities available-for-sale                   87,988                 --
           Other                                               --                102
                                                        ---------          ---------
                                                          494,767            496,775
         Valuation allowance                             (431,434)          (483,358)
                                                        ---------          ---------
                                                           63,333             13,417
                                                        ---------          ---------
         Deferred tax liabilities:
           Depreciation                                    13,384              9,487
           Loan loss reserves                                  --                 --
           Securities available-for-sale                       --              3,930
                                                        ---------          ---------
                                                           13,384             13,417
                                                        ---------          ---------

         Net deferred tax assets                        $  49,949          $      --
                                                        =========          =========
</TABLE>


                                       51
<PAGE>   54

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 8.  RELATED PARTY TRANSACTIONS AND LEASES

         The Company leases its main office banking facilities under a
         noncancelable operating lease agreement from GBC Properties, LLC, a
         partnership formed by the organizers of the Company. The lease term is
         for fifteen years with the monthly rental payment adjusting every fifth
         year for changes in the Consumer Price Index. The lease agreement also
         requires the Company to pay normal operating and occupancy expenses of
         the facilities. The total minimum rental commitment under this lease at
         December 31, 1999 is due as follows:

<TABLE>

         <S>                                                               <C>
         During the next five years                                        $    1,432,980
         During the remaining term of the lease                                 2,865,960
                                                                           --------------
                                                                           $    4,298,940
                                                                           ==============
</TABLE>

                  Total rental expense is summarized as follows:

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

         <S>                                            <C>                <C>
         GBC Properties, LLC                            $ 238,830          $  59,708
         Other third parties                                   --             58,293
                                                        ---------          ---------
                                                        $ 238,830          $ 118,001
                                                        =========          =========
</TABLE>


NOTE 9.  STOCK OPTIONS

                  The Company has reserved 180,000 shares of common stock for
         issuance to key employees and directors under an incentive stock option
         plan. The options granted are exercisable at a price of $10 and expire
         ten years from the grant date.



                                       52
<PAGE>   55

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 9.  STOCK OPTIONS (CONTINUED)

         Other pertinent information related to the options is as follows:

<TABLE>
<CAPTION>
                                                                           YEARS ENDED DECEMBER 31,
                                                           --------------------------------------------------------
                                                                      1999                        1998
                                                            -------------------------     -------------------------
                                                                            WEIGHTED-                      WEIGHTED-
                                                                             AVERAGE                       AVERAGE
                                                                            EXERCISE                       EXERCISE
                                                             NUMBER           PRICE        NUMBER           PRICE
                                                            ---------       ---------     ----------      ----------

         <S>                                                <C>             <C>           <C>             <C>
         Under option, beginning of year                       60,000       $   10.00             --      $      --
            Granted                                            45,000           10.00         60,000          10.00
            Exercised                                          (1,500)          10.00             --             --
            Terminated                                      ---------              --             --             --
                                                                                          ----------
         Under option and exercisable, end of year            103,500           10.00         60,000          10.00
                                                            =========                     ==========
         Weighted average remaining contractual life                9                             10
                                                            =========                     ==========

         Weighted average fair value of
            options granted during the year                 $    4.86                     $     3.97
                                                            =========                     ==========
</TABLE>

         As permitted by SFAS No. 123, ("Accounting for Stock-Based
         Compensation"), the Company recognizes compensation cost for
         stock-based employee compensation awards in accordance with APB Opinion
         No. 25, ("Accounting for Stock Issued to Employees"). As allowed by APB
         Opinion No. 25, the Company recognized no compensation cost for
         stock-based employee compensation awards for the years ended December
         31, 1999 and 1998. If the Company had recognized compensation cost in
         accordance with SFAS No. 123, net income (loss) and earnings (losses)
         per share would have changed as follows:

<TABLE>
<CAPTION>

                                                         YEAR ENDED DECEMBER 31, 1999
                                                       ---------------------------------
                                                                            BASIC AND
                                                                        DILUTED EARNINGS
                                                       NET INCOME           PER SHARE
                                                       ----------       ----------------

         <S>                                           <C>              <C>
         As reported                                    $ 444,990          $    0.47
         Stock-based compensation,
            net of related tax effect                    (144,382)             (0.15)
                                                        ---------          ---------
         As adjusted                                    $ 300,608          $    0.32
                                                        =========          =========
</TABLE>



                                       53
<PAGE>   56

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 9.  STOCK OPTIONS (CONTINUED)

<TABLE>
<CAPTION>
                                                                               YEAR ENDED DECEMBER 31, 1998
                                                                              ------------------------------
                                                                                                 BASIC AND
                                                                                              DILUTED LOSSES
                                                                              NET LOSS           PER SHARE
                                                                             ----------       --------------
         <S>                                                                 <C>              <C>
         As reported                                                         $ (507,768)           $   (0.53)
         Stock-based compensation,
            net of related tax effect                                          (157,145)               (0.16)
                                                                             ----------       --------------
         As adjusted                                                         $ (664,913)           $   (0.69)
                                                                             ==========       ==============
</TABLE>

         The fair value of the options granted during the year was based upon
         the Black-Scholes method of valuing options using the following
         weighted-average assumptions:

<TABLE>
<CAPTION>
                                                                                YEARS ENDED DECEMBER 31,
                                                                          -------------------------------------
                                                                               1999                1998
                                                                          ---------------    ------------------
         <S>                                                              <C>                <C>
         Risk-free interest rate                                                   6.77%                 5.12%
         Expected life of the options                                           10 years              10 years
         Expected dividends (as a percent of the fair value of the stock)             0%                    0%
         Volatility                                                                   0%                    0%
</TABLE>


NOTE 10. EARNINGS (LOSSES) PER COMMON SHARE

         The following is a reconciliation of net income (loss) and
         weighted-average shares outstanding used in determining basic and
         diluted earnings (losses) per common share:

<TABLE>
<CAPTION>

                                                             YEAR ENDED DECEMBER 31, 1999
                                                     -------------------------------------------
                                                        NET        WEIGHTED-AVERAGE   PER SHARE
                                                       INCOME           SHARES          AMOUNT
                                                     -----------     -----------       --------
         <S>                                         <C>            <C>               <C>
         BASIC EARNINGS PER COMMON SHARE             $   444,990         950,298       $   0.47
                                                                                       ========
         EFFECT OF DILUTIVE SECURITIES
            Stock options                                     --              --
                                                     -----------     -----------
         DILUTED EARNINGS PER COMMON SHARE           $   444,990         950,298       $   0.47
                                                     ===========     ===========       ========
</TABLE>



                                       54
<PAGE>   57

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 10. EARNINGS (LOSSES) PER COMMON SHARE (CONTINUED)

<TABLE>
<CAPTION>
                                                                                 YEAR ENDED DECEMBER 31, 1998
                                                                   -----------------------------------------------------
                                                                      NET             WEIGHTED-AVERAGE         PER SHARE
                                                                      LOSS                 SHARES               AMOUNT
                                                                   ---------          ----------------        ----------
          <S>                                                      <C>                <C>                     <C>
          BASIC LOSSES PER COMMON SHARE                            $(507,768)              950,080             $   (0.53)
                                                                                                               =========
          EFFECT OF DILUTIVE SECURITIES
             Stock options                                                --                    --
                                                                   ---------             ---------
          DILUTED LOSSES PER COMMON SHARE                          $(507,768)              950,080             $   (0.53)
                                                                   =========             =========             =========
</TABLE>

         Because the exercise price of the stock options approximate the fair
         value of the Company's common stock, the stock options have no dilutive
         effect.


NOTE 11. COMMITMENTS AND CONTINGENT LIABILITIES

         In the normal course of business, the Company has entered into
         off-balance-sheet financial instruments which are not reflected in the
         financial statements. These financial instruments include commitments
         to extend credit and standby letters of credit. Such financial
         instruments are included in the financial statements when funds are
         disbursed or the instruments become payable. These instruments involve,
         to varying degrees, elements of credit risk in excess of the amount
         recognized in the balance sheet.

         The Company's exposure to credit loss in the event of nonperformance by
         the other party to the financial instrument for commitments to extend
         credit and standby letters of credit is represented by the contractual
         amount of those instruments. A summary of the Company's commitments is
         as follows:

<TABLE>
<CAPTION>
                                                                                DECEMBER 31,
                                                                         ----------------------------
                                                                             1999            1998
                                                                         -------------  -------------

         <S>                                                             <C>            <C>
         Letters of credit                                               $    704,246   $      26,605
         Commitments to extend credit                                      21,739,731      16,080,774
                                                                         ------------   -------------
                                                                         $ 22,443,977   $  16,107,379
                                                                         ============   =============
</TABLE>



                                       55
<PAGE>   58

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 11. COMMITMENTS AND CONTINGENT LIABILITIES (CONTINUED)

         Commitments to extend credit generally have fixed expiration dates or
         other termination clauses and may require payment of a fee. Since many
         of the commitments are expected to expire without being drawn upon, the
         total commitment amounts do not necessarily represent future cash
         requirements. The credit risk involved in issuing these financial
         instruments is essentially the same as that involved in extending loans
         to customers. The Company evaluates each customer's creditworthiness on
         a case-by-case basis. The amount of collateral obtained, if deemed
         necessary by the Company upon extension of credit, is based on
         management's credit evaluation of the customer. Collateral held varies
         but may include real estate and improvements, marketable securities,
         accounts receivable, inventory, equipment, and personal property.

         Standby letters of credit are conditional commitments issued by the
         Company to guarantee the performance of a customer to a third party.
         Those guarantees are primarily issued to support public and private
         borrowing arrangements. The credit risk involved in issuing letters of
         credit is essentially the same as that involved in extending loans to
         customers. Collateral held varies as specified above and is required in
         instances which the Company deems necessary.

         In the normal course of business, the Company is involved in various
         legal proceedings. In the opinion of management of the Company, any
         liability resulting from such proceedings would not have a material
         effect on the Company's financial statements.


NOTE 12. CONCENTRATIONS OF CREDIT

         The Company originates primarily commercial, residential, and consumer
         loans to customers in Gwinnett County and surrounding counties. The
         ability of the majority of the Company's customers to honor their
         contractual loan obligations is dependent on the economy in these
         areas.

         Seventy percent the Company's loan portfolio is concentrated in loans
         secured by real estate, of which a substantial portion is secured by
         real estate in the Company's primary market area. Accordingly, the
         ultimate collectibility of the loan portfolio is susceptible to changes
         in market conditions in the Company's primary market area. The other
         significant concentrations of credit by type of loan are set forth in
         Note 3.

         The Company, as a matter of policy, does not generally extend credit to
         any single borrower or group of related borrowers in excess of 25% of
         the lesser of statutory capital or net assets as defined, or
         approximately $2,025,000.



                                       56
<PAGE>   59

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 13. REGULATORY MATTERS

         The Bank is subject to certain restrictions on the amount of dividends
         that may be declared without prior regulatory approval. At December 31,
         1999, no dividends could be declared without regulatory approval.

         The Company and the Bank are subject to various regulatory capital
         requirements administered by the federal banking agencies. Failure to
         meet minimum capital requirements can initiate certain mandatory, and
         possibly additional discretionary actions by regulators that, if
         undertaken, could have a direct material effect on the financial
         statements. Under capital adequacy guidelines and the regulatory
         framework for prompt corrective action, the Company and Bank must meet
         specific capital guidelines that involve quantitative measures of the
         assets, liabilities, and certain off-balance-sheet items as calculated
         under regulatory accounting practices. The capital amounts and
         classification are also subject to qualitative judgments by the
         regulators about components, risk weightings, and other factors. Prompt
         corrective provisions are not applicable to bank holding companies.

         Quantitative measures established by regulation to ensure capital
         adequacy require the Company and the Bank to maintain minimum amounts
         and ratios of Total and Tier I capital to risk-weighted assets and of
         Tier I capital to average assets. Management believes, as of December
         31, 1999, the Company and the Bank met all capital adequacy
         requirements to which they are subject.



                                       57
<PAGE>   60

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 13. REGULATORY MATTERS (CONTINUED)

         As of December 31, 1999, the most recent notification from the Federal
         Deposit Insurance Corporation categorized the Bank as well capitalized
         under the regulatory framework for prompt corrective action. To be
         categorized as well capitalized, the Bank must maintain minimum Total
         risk-based, Tier I risk-based, and Tier I leverage ratios as set forth
         in the following table. There are no conditions or events since that
         notification that management believes have changed the Bank's category.

<TABLE>
<CAPTION>
                                                                                                         TO BE WELL
                                                                                     FOR CAPITAL      CAPITALIZED UNDER
                                                                                      ADEQUACY        PROMPT CORRECTIVE
                                                                  ACTUAL              PURPOSES        ACTION PROVISIONS
                                                           --------------------   ----------------   -------------------
                                                            AMOUNT      RATIO     AMOUNT     RATIO    AMOUNT     RATIO
                                                           --------    --------   -------   -------  --------   -------
                                                                                (DOLLARS IN THOUSANDS)
                                                           -------------------------------------------------------------
          <S>                                             <C>          <C>        <C>        <C>      <C>       <C>
          DECEMBER 31, 1999:
          TOTAL CAPITAL TO RISK WEIGHTED ASSETS:
             CONSOLIDATED                                  $9,094       19.28%     $3,773      8%      $  N/A     N/A
             BANK                                          $8,785       18.63%     $3,773      8%      $4,716      10%
          TIER I CAPITAL TO RISK WEIGHTED ASSETS:
             CONSOLIDATED                                  $8,503       18.03%     $1,887      4%      $  N/A     N/A
             BANK                                          $8,194       17.37%     $1,887      4%      $2,830       6%
          TIER I CAPITAL TO AVERAGE ASSETS:
             CONSOLIDATED                                  $8,503       14.98%     $2,271      4%      $  N/A     N/A
             BANK                                          $8,194       14.43%     $2,271      4%      $2,839       5%

          December 31, 1998:
          Total Capital to Risk Weighted Assets:
             Consolidated                                  $8,365       32.50%     $2,060      8%      $  N/A     N/A
             Bank                                          $8,040       31.24%     $2,060      8%      $2,574      10%
          Tier I Capital to Risk Weighted Assets:
             Consolidated                                  $8,043       31.25%     $1,030      4%      $  N/A     N/A
             Bank                                          $7,718       29.99%     $1,030      4%      $1,545       6%
          Tier I Capital to Average Assets:
             Consolidated                                  $8,043       25.77%     $1,249      4%      $  N/A     N/A
             Bank                                          $7,718       24.73%     $1,249      4%      $1,561       5%
</TABLE>



                                       58
<PAGE>   61

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 14. FAIR VALUE OF FINANCIAL INSTRUMENTS

         The following methods and assumptions were used by the Company in
         estimating its fair value disclosures for financial instruments. In
         cases where quoted market prices are not available, fair values are
         based on estimates using discounted cash flow models. Those models are
         significantly affected by the assumptions used, including the discount
         rates and estimates of future cash flows. In that regard, the derived
         fair value estimates cannot be substantiated by comparison to
         independent markets and, in many cases, could not be realized in
         immediate settlement of the instrument. The use of different
         methodologies may have a material effect on the estimated fair value
         amounts. Also, the fair value estimates presented herein are based on
         pertinent information available to management as of December 31, 1999
         and 1998. Such amounts have not been revalued for purposes of these
         financial statements since those dates and, therefore, current
         estimates of fair value may differ significantly from the amounts
         presented herein.

         CASH, DUE FROM BANKS, AND FEDERAL FUNDS SOLD:

         The carrying amounts of cash, due from banks, and Federal funds sold
         approximate their fair value.

         SECURITIES AVAILABLE-FOR-SALE:

         Fair values for securities are based on available quoted market prices.

         LOANS:

         For variable-rate loans that reprice frequently and have no significant
         change in credit risk, fair values are based on carrying values. For
         other loans, the fair values are estimated using discounted cash flow
         models, using current market interest rates offered for loans with
         similar terms to borrowers of similar credit quality. Fair values for
         impaired loans are estimated using discounted cash flow models or based
         on the fair value of the underlying collateral.

         DEPOSITS:

         The carrying amounts of demand deposits, savings deposits, and
         variable-rate certificates of deposit approximate their fair values.
         Fair values for fixed-rate certificates of deposit are estimated using
         discounted cash flow models, using current market interest rates
         offered on certificates with similar remaining maturities.



                                       59
<PAGE>   62

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 14. FAIR VALUE OF FINANCIAL INSTRUMENTS (CONTINUED)

         ACCRUED INTEREST:

         The carrying amounts of accrued interest approximate their fair values.

         OFF-BALANCE SHEET INSTRUMENTS:

         The fair values of the Company's off-balance sheet financial
         instruments are based on fees charged to enter into similar agreements.
         However, commitments to extend credit and standby letters of credit do
         not represent a significant value to the Company until such commitments
         are funded. The Company has determined that these instruments do not
         have a distinguishable fair value and no fair value has been assigned.

         The carrying amounts and estimated fair values of the Company's
         financial instruments were as follows:

<TABLE>
<CAPTION>
                                                                DECEMBER 31, 1999              December 31, 1998
                                                            --------------------------     -------------------------
                                                             CARRYING         FAIR          Carrying        Fair
                                                              AMOUNT          VALUE          Amount         Value
                                                            ----------      ----------     ----------     ----------
         <S>                                                <C>             <C>            <C>            <C>
         FINANCIAL ASSETS:
            Cash, due from banks,
               and Federal funds sold                      $ 9,842,647     $ 9,842,647    $ 4,340,046    $ 4,340,046
            Securities available-for-sale                    6,836,993       6,836,993      4,008,520      4,008,520
            Loans                                           43,611,649      44,248,307     24,067,180     24,540,036
            Accrued interest receivable                        434,485         434,485        258,190        258,190

         FINANCIAL LIABILITIES:
            Deposits                                        53,783,842      54,104,299     25,007,527     25,084,466
            Accrued interest payable                           210,922         210,922        201,499        201,499
</TABLE>



                                       60
<PAGE>   63

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 15. SUPPLEMENTAL FINANCIAL DATA

         Components of other operating income and expenses in excess of 1% of
         total revenue are as follows:

<TABLE>
<CAPTION>
                                                          YEARS ENDED DECEMBER 31,
                                                        ----------------------------
                                                          1999               1998
                                                        ---------          ---------
         <S>                                            <C>                <C>
         Other operating income:
            Mortgage origination fees                   $  62,790          $  39,793
         Other operating expenses:
            Telephone                                      46,547             31,202
            Office supplies                                37,556             49,385
            Professional and consulting                   116,048            107,274
            Data processing                                79,485             67,152
</TABLE>


NOTE 16. PARENT COMPANY FINANCIAL INFORMATION

         The following information presents the condensed balance sheets,
         statements of operations and cash flows of GBC Bancorp, Inc., as of and
         for the years ended December 31, 1999 and 1998

                            CONDENSED BALANCE SHEETS

<TABLE>
<CAPTION>

                                                                                       1999               1998
                                                                                    ----------         ----------

          <S>                                                                       <C>                <C>
          ASSETS
             Cash                                                                   $  308,287         $  329,372
             Investment in subsidiary                                                7,935,620          7,729,894
                                                                                    ----------         ----------

                Total assets                                                        $8,243,907         $8,059,266
                                                                                    ==========         ==========

          LIABILITIES                                                               $       --         $    5,000
          STOCKHOLDERS' EQUITY                                                       8,243,907          8,054,266
                                                                                    ----------         ----------

                  TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                        $8,243,907         $8,059,266
                                                                                    ==========         ==========
</TABLE>



                                       61
<PAGE>   64

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 16. PARENT COMPANY FINANCIAL INFORMATION (CONTINUED)

                       CONDENSED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                                      1999               1998
                                                                                    ----------         ----------
          <S>                                                                       <C>                <C>
          EXPENSES
             Write-off of organization costs                                        $       --         $   72,514
             Other expenses                                                             31,085             36,749
                                                                                    ----------         ----------
                 TOTAL EXPENSES                                                         31,085            109,263
                                                                                    ----------         ----------

                 LOSS BEFORE EQUITY IN UNDISTRIBUTED
                     EARNINGS (LOSS) OF SUBSIDIARY                                     (31,085)          (109,263)

          EQUITY IN UNDISTRIBUTED EARNINGS (LOSS)
             OF SUBSIDIARY                                                             476,075           (398,505)
                                                                                    ----------         ----------

                  NET INCOME (LOSS)                                                 $  444,990         $ (507,768)
                                                                                    ==========         ==========
</TABLE>



                                       62
<PAGE>   65

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 16. PARENT COMPANY FINANCIAL INFORMATION (CONTINUED)

                       CONDENSED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                       1999              1998
                                                                                    ----------         ----------

          <S>                                                                       <C>                <C>
          OPERATING ACTIVITIES
             Net income (loss)                                                      $  444,990         $ (507,768)
             Adjustments to reconcile net income (loss) to net
                cash used in operating activities:
                Write-off of organization costs                                             --             72,514
                Equity in undistributed (earnings) loss of subsidiary                 (476,075)           398,505
                Other operating activities                                              (5,000)             5,000
                                                                                    ----------         ----------

                    Net cash used in operating activities                              (36,085)           (31,749)
                                                                                    ----------         ----------

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

                    Net cash provided by financing activities                           15,000                 --
                                                                                    ----------         ----------

          Net decrease in cash                                                         (21,085)           (31,749)

          Cash at beginning of year                                                    329,372            361,121
                                                                                    ----------         ----------

          Cash at end of year                                                       $  308,287         $  329,372
                                                                                    ==========         ==========
</TABLE>


                                       63
<PAGE>   66

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE

         None.

                                    PART III

ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

         The following table sets forth the current members our Board of
Directors and the Board of Directors of the Bank, our senior and executive
officers and the senior executive officers of the Bank (a) their names,
addresses and ages at December 31, 1999, (b) the positions they hold, if any,
and (c) the year first elected as a Director.

<TABLE>
<CAPTION>
                                                                                              YEAR FIRST
                                                                                              ELECTED AS
           NAME                       AGE    POSITION HELD                                    A DIRECTOR
       ------------                   ---    -------------                                    ----------
       <S>                            <C>    <C>                                              <C>
       Larry D. Key                    54    President, Chief Executive Officer                 1996
                                             and Chairman of the Company and the Bank

       John T. Hopkins III             58    Executive Vice President, Chief
                                             Financial Officer, Secretary and
                                             Treasurer of the Company and the Bank

       Michael A. Roy                  55    Executive Vice President and Chief
                                             Credit Officer of the Bank

       Paul C. Birkhead                55    Senior Vice President and
                                             Commercial Loan Officer of the Bank

       Michael L. Couch                39    Senior Vice President of the Bank

       Marcia N. Watkins               54    Senior Vice President and Chief
                                             Operations Officer of the Bank

       James B. Ballard                55    Director of the Company and the Bank               1996

       Jerry M. Boles                  59    Director of the Company and the Bank               1996
</TABLE>

                                       64
<PAGE>   67

<TABLE>
<CAPTION>
                                                                                              YEAR FIRST
                                                                                              ELECTED AS
           NAME                       AGE    POSITION HELD                                    A DIRECTOR
       ------------                   ---    -------------                                    ----------
       <S>                            <C>    <C>                                              <C>
       W. H. Britt                     61    Director of the Company and the Bank               1996

       Richard F. Combs                52    Director of the Company and the Bank               1997

       William G. Hayes                61    Director of the Company and the Bank               1997

       Douglas A. Langley              42    Director of the Company and the Bank               1997

       Norris J. Nash                  72    Director of the Company and the Bank               1996

       J. Joseph Powell                56    Director of the Company and the Bank               1997

       William S. Stanton, Jr.         45    Director of the Company and the Bank               1996
</TABLE>

BIOGRAPHIES

         JAMES B. BALLARD has been a member of our Board of Directors since
1996. Mr. Ballard was the Chief Executive Officer, founder, and a member of the
board of directors from 1972 until January 1996 of Spartan Constructors, Inc.
Mr. Ballard currently serves as President and Chief Executive Officer of The
Spartan Group, an industrial contractor serving the continental United States.

         PAUL C. BIRKHEAD was Executive Vice President and Senior Lending
Officer of Commercial Bank of Georgia from 1988 when Commercial Bank opened
until July 1995 when he resigned to participate in our organizing group. Mr.
Birkhead was Group Vice President of Commercial Lending of Heritage Bank from
1984 until November 1987, when Heritage merged with Bank South, N.A. Mr.
Birkhead was Vice President of Commercial Lending for Bank South, N.A. until he
resigned in January 1988 to join the organizing group of Commercial Bank of
Georgia.

         JERRY M. BOLES has been a member of our Board of Directors since 1996.
Mr. Boles has been in the wholesale automotive after-market for 35 years. Mr.
Boles is owner and President of Boles Parts Supply, Inc., which was founded in
1964, with headquarters in Atlanta, Georgia and distribution warehouses in
Oklahoma City, Oklahoma; Tappahannock, Virginia and Dahlonega, Georgia.

         W. H. BRITT has been a member of our Board of Directors since 1996.
Mr. Britt has been an active businessman in the Gwinnett County area, since
1975. He is the founder and owner of

                                      65
<PAGE>   68

H & H Truck and Tractor, Inc., an equipment sales company, and W. H. Britt and
Associates, Inc., a real estate brokerage and development company. Mr. Britt
was an organizer of Gwinnett County Bank (Heritage Bank) in 1972 and served as
a director until 1987 when the bank was sold.

         RICHARD F. COMBS has been a member of our Board of Directors since
1997. Mr. Combs is the Founder and President of Pureflow Ultraviolet, Inc., a
company specializing in ultraviolet disinfecting equipment, parts and services
to industrial clients since 1978.

         MICHAEL L. COUCH has served as Senior Vice President of the Bank since
February 1998. Prior to February 1998, Mr. Couch served as Senior Vice
President of Construction Lending for Colonial Bank. Colonial Bank acquired
Commercial Bank of Georgia in 1996. Mr. Couch served as Senior Vice President
of Commercial Bank of Georgia from 1988 until the merger with Colonial Bank in
1996.

         WILLIAM G. HAYES has been a member of our Board of Directors since
1997. Mr. Hayes is President and Chairman of Hayes, James and Associates, an
engineering and survey company based in Duluth, Georgia. Mr. Hayes was a
director of the First National Bank of Gwinnett from 1984 to 1986.

         JOHN T. HOPKINS III was the Chief Financial Officer and Executive Vice
President of Commercial Bank of Georgia until he resigned in July 1996 to
participate in our organizing group. Mr. Hopkins was Chief Financial Officer
and Chief Operating Officer of Paragon Mortgage from 1993 to 1995. He was Chief
Financial Officer of West Corp. which operated commercial, electrical and
mechanical contracting companies from 1989 to 1993. From 1985 to 1989, he was
Internal Auditor and Chief Financial Officer of Heritage Bank and Corporate
Accountant of Williams Service Group. Prior to 1985, Mr. Hopkins was a partner
with H. H. Brunet and Company, Certified Public Accountants, specializing in
the financial services industry.

         LARRY D. KEY has been a member of our Board of Directors since 1996.
Mr. Key was the Executive Vice President and Chief Lending Officer of
Commercial Bank of Georgia from the merger of Commercial Bank of Georgia and
Commercial Bank of Gwinnett in March 1995 until he resigned in July 1996 to
participate in our organizing group and the Bank's organizing group. Mr. Key
served as President and Chief Executive Officer of the former Commercial Bank
of Georgia from 1994 until merger. He served as Executive Vice President and
Chief Credit Officer of the former Commercial Bank of Georgia from 1992 until
1994. Mr. Key was senior Vice President from the opening of the former
Commercial Bank of Georgia in 1988 until 1992. He was Group Vice President and
an advisory director of Heritage Bank from 1984 until 1987. Mr. Key managed
Moores Building Center, Inc. in Dahlonega, Georgia from 1987 to 1988. Mr. Key
served as a director of Commercial Bancorp of Georgia, Inc. and Commercial Bank
of Georgia from their initial organization in 1988 until July 1996.

         DOUGLAS A. LANGLEY has been a member of our Board of Directors since
1997. Mr. Langley is the current managing partner of Ashworth and Associates, a
CPA firm in Tucker and Lawrenceville, Georgia. He has been a member of the firm
since 1977.

                                      66
<PAGE>   69

         NORRIS J. NASH has been a member of our Board of Directors since 1996.
Mr. Nash is the President of Metropolitan Land Development and Investment
Corporation and Gwinnett-DeKalb, Inc. He has been a real estate developer since
1962. Mr. Nash has served as director of the former Gwinnett County Bank, and
on the Advisory Board of Wachovia Bank of Georgia, N.A. Mr. Nash was a member
of the House of Representatives for Gwinnett County, District 22, Post #1 from
1967 to 1969.

         J. JOSEPH POWELL has been a member of our Board of Directors since
1997. Mr. Powell has been President of Joe Powell and Associates, Inc. since
1971 representing Liebert Corporation, provider of mechanical equipment for
computer operations.

         MICHAEL A. ROY has served as an Assistant Director and a Field Manager
with the Office of Thrift Supervision in Atlanta, Georgia, from 1988 through
1997 when he resigned to join the Bank. Prior to that time, he was Vice
President and Senior Lender at Capital-Union Savings, FA in Baton Rouge,
Louisiana for three years and was Executive Vice President and Director at
Citizens Savings and Loan Association in Baton Rouge, Louisiana for eight
years.

         WILLIAM S. STANTON, JR. has been a member of our Board of Directors
since 1996. Mr. Stanton is President of Print Direction, Inc. and Atlanta
Screen Print, Inc. Mr. Stanton has served as President of Print Direction since
its inception in 1984 and Atlanta Screen Print since 1988. He was an Account
Representative with Xerox Corporation from 1977 to 1981.

         MARCIA N. WATKINS served as Senior Vice President and Chief Operations
Officer of Commercial Bank of Georgia from its inception in February 1988 to
June 1996. Ms. Watkins was one of the original seven employees involved in the
opening of Gwinnett County Bank, a/k/a Heritage Bank, in February 1971. Ms.
Watkins served as Senior Operations Officer of Heritage Trust from February
1986 to February 1988. Ms. Watkins held various positions with the Heritage
Bank, including Vice President and Cashier between 1971 and 1986.

         We are not subject to filings required by Section 16 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). We are filing this
Annual Report on Form 10-KSB pursuant to Section 15(d) of the Exchange Act.

ITEM 10.  EXECUTIVE COMPENSATION

         The following table provides information with respect to the annual
compensation for services in all capacities to the Company for 1997, 1998 and
1999 for the Chief Executive Officer. No other officer of the Company earned
more than $100,000 in 1999.

                                      67
<PAGE>   70

         SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
                                                                                                 LONG-TERM
                                                                   ANNUAL                   COMPENSATION AWARDS
                                                              COMPENSATION (1)              -------------------
                NAME AND                                      ----------------                  SECURITIES
           PRINCIPAL POSITION                  YEAR          SALARY          BONUS          UNDERLYING OPTIONS
           ------------------                  ----         --------         -----          -------------------
<S>                                            <C>          <C>              <C>            <C>
Larry D. Key                                   1999         $130,000           --                  10,000
   President, Chief Executive Officer          1998         $130,000           --                   6,000
   and Chairman                                1997         $130,000           --                      --
</TABLE>
---------------
 (1)     In accordance with the rules of the Securities and Exchange
         Commission, the compensation set forth in the table does not include
         medical, group life insurance or other benefits which are available to
         all salaried employees of the Company and certain perquisites and
         other benefits, securities or property which do not exceed the lesser
         of $50,000 or 10% of the Chief Executive Officer's salary and bonus
         shown in the table.

STOCK OPTIONS GRANTS AND YEAR END VALUES

                       OPTION GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
                                                                             INDIVIDUAL GRANTS
                                                         -------------------------------------------------------
                                                         PERCENT OF TOTAL
                           NUMBER OF SECURITIES          OPTIONS GRANTED       EXERCISE OF
                            UNDERLYING OPTIONS             TO EMPLOYEES        BASE PRICE
         NAME                  GRANTED(1)                 IN FISCAL YEAR        PER SHARE        EXPIRATION DATE
         ----              --------------------          ----------------      -----------       ---------------
<S>                        <C>                           <C>                   <C>               <C>
Larry D. Key                      10,000                      22.2%                $10.00            9/20/09

</TABLE>
---------------
(1)      Options granted to Mr. Key were incentive options and were granted at
         an exercise price of not less than fair market value on the date of
         grant, as determined by the Board of Directors. The options granted to
         Mr. Key are fully vested and expire 10 years after the date of grant.

         No options were exercised by Mr. Key in 1999.

                       AGGREGATES/YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
                              NUMBER OF SECURITIES           VALUE OF UNEXERCISABLE
                             UNDERLYING UNEXERCISED           IN-THE-MONEY OPTIONS
           NAME              OPTIONS AT YEAR-END(1)                AT YEAR-END(1)
           ----              ----------------------           ---------------------
<S>                          <C>                             <C>
Larry D. Key                         16,000                         $40,000
</TABLE>

                                      68
<PAGE>   71
--------------------
(1)      There was no public trading market for the common stock as of December
         31, 1999. Accordingly, these values have been calculated by
         determining the difference between the estimated fair market value of
         our common stock underlying the option as of December 31, 1999 ($12.50
         per share) and the exercise price per share payable upon exercise of
         such options ($10.00 per share). In determining the fair market value
         of our common stock, the Board of Directors considered various
         factors, including our financial condition and business prospects, our
         operating results and the absence of a market for our common stock.
         All options granted to Mr. Key are currently exercisable.

EMPLOYEE BENEFIT PLANS

         1998 Stock Option Plan. On October 19, 1999, our shareholders adopted
the 1998 Option Plan of GBC Bancorp, Inc. (the "1998 Option Plan"). Under the
1998 Option Plan, the Board of Directors, or the Compensation Committee of the
Board of Directors, has the flexibility to determine the type and amount of
awards to be granted to eligible participants. The 1998 Option Plan is intended
to secure for us and our shareholders the benefits arising from ownership of
the common stock by individuals employed or retained by us or the Bank who will
be responsible for the future growth of the enterprise. The 1998 Option Plan is
designed to help attract and retain superior personnel for positions of
substantial responsibility with us and the Bank (including advisory
relationships where appropriate), and to provide individuals with an additional
incentive to contribute to our success.

         The Board or the Compensation Committee may make the following types
of grants under the 1998 Option Plan, each of which will be an "Award":

         -        incentive stock options ("ISOs") and

         -        nonqualified stock options ("NSOs").

         Our or the Bank's officers, key employees, employee directors,
consultants and other independent contractors or agents who are responsible for
or contribute to the management growth or profitability of our business will be
eligible for selection by our Board of Directors or the Compensation Committee
to participate in the 1998 Option Plan, provided, however, that ISOs may be
granted only to a person employed by us or the Bank.

         The Georgia Department has placed certain restrictions on the award of
options under the 1998 Option Plan. In particular, any option granted under the
1998 Option Plan may be subject to accelerated exercise or forfeiture if the
Bank's Tier 1 leverage capital falls below certain minimum regulatory
requirements. Additionally, since the Georgia Department must grant prior
approval to any shareholder (including the shareholder's spouse and children)
before a shareholder may own more than twenty percent (20%) of our outstanding
stock, the exercise of options may be limited by the Georgia Department. These
restrictions may be lifted in the future by the Georgia Department.

         We have authorized and reserved for issuance an aggregate of 180,000
shares of our common stock under the 1998 Option Plan. As of March 30, 2000 we
have granted options to

                                      69
<PAGE>   72

purchase 105,000 shares of our common stock. The shares of common stock
issuable under the 1998 Option Plan are authorized but unissued shares. If any
of the Awards granted under the 1998 Option Plan expire, terminate or are
forfeited for any reason before they have been exercised, vested or issued in
full, the unused shares subject to those expired, terminated or forfeited
Awards will again be available for purposes of the 1998 Option Plan. The 1998
Option Plan will continue in effect until December 14, 2008 unless sooner
terminated under the general provisions of the 1998 Option Plan.

         The 1998 Option Plan is administered by the Board of Directors or upon
its delegation to the Compensation Committee of the Board of Directors, by the
Compensation Committee, consisting of not less than two directors who are
"non-employee directors" (within the meaning of SEC Rule 16b-3 promulgated
pursuant to the Securities Exchange Act of 1934, as amended). Subject to the
foregoing limitations, as applicable, the Board of Directors may from time to
time remove members from the Compensation Committee, fill all vacancies on the
Compensation Committee, however caused, and may select one of the members of
the Compensation Committee as its chairman. The Compensation Committee may hold
meetings at such times and places as they may determine, will keep minutes of
their meetings, and may adopt, amend and revoke rules and procedures in
accordance with the terms of the 1998 Option Plan.

COMPENSATION OF DIRECTORS

         The Conditions provide that the directors and committee members of the
Bank will not receive any fees, bonuses, or other payments until the Bank earns
a cumulative profit.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following table sets forth the beneficial ownership of the Common
Stock as of March 30, 2000, by each director and our Chief Executive Officer,
and all of our directors and our Chief Executive Officer as a group. No person
known by us beneficially owns more than 5% of our common stock. The information
in this table was based in part on information supplied by the named
individuals.

<TABLE>
<CAPTION>
                                                             NUMBER OF SHARES OF COMMON          PERCENTAGE
NAME AND ADDRESS OF BENEFICIAL OWNER                        STOCK BENEFICIALLY OWNED(1)           OWNERSHIP
------------------------------------                        ---------------------------          ----------
<S>                                                         <C>                                  <C>
Larry D. Key (2)
3300 Jim Moore Road
Dacula, Georgia 30019                                                    32,510                      3.08%


James B. Ballard (3)
2400 Bagley Road
Cumming, Georgia 30040                                                   43,406                      4.11%
</TABLE>

                                      70
<PAGE>   73

<TABLE>
<CAPTION>
                                                            NUMBER OF SHARES OF COMMON          PERCENTAGE
NAME AND ADDRESS OF BENEFICIAL OWNER                        STOCK BENEFICIALLY OWNED(1)           OWNERSHIP
------------------------------------                        ---------------------------          ----------
<S>                                                         <C>                                  <C>
Jerry M. Boles (4)
Boles Parts Supply, Inc.
1057 Boulevard, S.E.
Atlanta, Georgia 30312                                                   31,700                      3.00%

W. H. Britt (5)
W. H. Britt & Associates, Inc.
535 Grayson Parkway
Grayson, Georgia 30221                                                   20,337                      1.93%

Richard F. Combs (6)
Pureflow Ultraviolet, Inc.
1750 Spectrum Drive
Lawrenceville, Georgia  30043                                            24,761                      2.35%

William G. Hayes (7)
Hayes, James & Associates
3005 Breckenridge Boulevard, Suite 200
Duluth, Georgia  30096                                                    6,000                          *

Douglas A. Langley (8)
Ashworth & Associates
270 Constitution Boulevard
Lawrenceville, Georgia  30045                                            25,900                      2.45%

Norris J. Nash (9)
Gwinnett DeKalb Realty, Inc.
4830 Lawrenceville Highway
Lilburn, Georgia  30047                                                  31,385                      2.97%

J. Joseph Powell (10)
Joe Powell & Associates
500 Miller Court
Norcross, Georgia  30071                                                 28,900                      2.74%

William S. Stanton, Jr. (11)
Print Direction, Inc.
1455 Oakbrook Drive
Norcross, Georgia  30093                                                 45,110                      4.28%


ALL DIRECTORS AND OFFICER AS A GROUP (15 PERSONS)                       374,285                     35.47%
</TABLE>

                                      71
<PAGE>   74

---------------

*        Represents less than one percent (1%) of the shares outstanding.
(1)      On a fully-diluted basis, except as otherwise indicated, the persons
         named in the table have sole voting and investment power with respect
         to all shares shown as beneficially owned by them. The information
         shown above is based upon information furnished by the named persons
         and based upon "beneficial ownership" concepts set forth in rules
         promulgated under the Exchange Act. Under such rules, a person is
         deemed to be a "beneficial owner" of a security if that person has or
         shares "voting power," which includes the power to vote or to direct
         the voting of such security, or "investment power," which includes the
         power to dispose or to direct the disposition of such security. A
         person is also deemed to be a beneficial owner of any security of
         which that person has the right to acquire beneficial ownership within
         60 days.
(2)      Includes options to purchase 16,000 shares of the Company's common
         stock.
(3)      Includes 5,000 shares owned by Mr. Ballard's son, 5,000 shares owned
         by a company that Mr. Ballard controls, and options to purchase 6,700
         shares of the Company's common stock.
(4)      Includes options to purchase 6,700 shares of the Company's common stock
(5)      Includes 1,500 shares owned by Mr. Britt's children and options to
         purchase 5,000 shares of the Company's common stock.
(6)      Includes 1,000 shares owned by Mr. Combs' wife, and options to
         purchase 3,400 shares of the Company's common stock.
(7)      Includes 2,500 shares owned by a company that Mr. Hayes controls,
         and options to purchase 1,000 shares of the Company's common stock.
(8)      Includes 20,000 shares held by the Ashworth & Associates, P.C. Profit
         Sharing Plan in which Mr. Langley is the Trustee, and options to
         purchase 2,400 shares of the Company's common stock.
(9)      Includes 2,500 shares owned by a company that Mr. Nash controls,
         and options to purchase 6,700 shares of the Company's common stock.
(10)     Includes 1,000 shares owned by Mr. Powell's son, and options to
         purchase 3,900 shares of the Company's common stock.
(11)     Includes options to purchase 5,700 shares of the Company's common
         stock.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         It is possible that the Bank will have banking and other business
transactions in the ordinary course of business with our directors and officers
and the directors and officers of the Bank, including members of their families
or corporations, partnerships or other organizations in which such directors
and officers have a controlling interest. If such transactions occur, they will
be on substantially the same terms (including price, interest rate and
collateral) as those prevailing at the time for comparable transactions with
unrelated parties, and any banking transactions will not be expected to involve
more than the normal risk of collectibility or present other unfavorable
features to us.

                                      72
<PAGE>   75

         Columbus Bank and Trust Company, The Bankers Bank, Regions Bank and
SunTrust Bank, Atlanta operate as correspondent banks for the Bank
(collectively, the "Correspondents"). The Correspondents provide bank services
such as check clearing, international services, wire transfers and various
additional services for the Bank. The Correspondents also serve the Bank
through purchasing and selling federal funds, purchasing other investments, and
providing short-term lines of credit for the purpose of borrowing and
purchasing federal funds from other institutions.

         All of the relationships established with the Correspondents were at
arms-length. There is no affiliation between the Bank and any of its officers
and directors and any of the Correspondents.

         On January 1, 2000, the Bank entered into a Lease Agreement with GBC
LLC to lease the banking facility. Most of the members of GBC LLC are our
directors and officers. We believe is as favorable as rates that would be
obtained from an unaffiliated third party.

                                      73
<PAGE>   76

                   ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits required by Item 601 of Regulation S-B

<TABLE>
<CAPTION>
         Exhibit
         Number                Description
         -------               -----------
         <S>            <C>
         3.1            Articles of Incorporation of the Company, as
                        amended (filed as Exhibit 3.1 to the
                        Registration Statement on Form SB-2, as amended
                        (Registration No. 333-19081)).
         3.2            Amended and Restated Bylaws
         4.1            Specimen Common Stock Certificate (filed as Exhibit 4.2
                        to the Registration Statement on Form SB-2, as amended
                        (Registration No. 333-19081)).
         10.1           Escrow Agreement between the Registrant and Columbus
                        Bank and Trust Company (filed as Exhibit 10.1 to the
                        Registration Statement on Form SB-2, as amended
                        (Registration No. 333-19081)).
         10.2           Line of Credit Promissory Note in the amount of
                        $500,000 having Registrant as Maker and Gwinnett
                        Banking Company GBC LLC as Holder (filed as Exhibit
                        10.2 to the Registration Statement on Form SB-2, as
                        amended (Registration No. 333-19081)).
         10.3           Provesa, Inc. Data Processing Agreement (filed as
                        Exhibit 10.3 to the Registration Statement on Form
                        SB-2, as amended (Registration No. 333-19081)).
         10.4           Real Estate Commercial Lease Contract dated as of
                        January 1, 2000, by and between GBC Properties, LLC
                        and Gwinnett Banking Company.
         21.1           Subsidiaries of the Registrant (filed as Exhibit 21.1 to
                        the Registration Statement on Form SB-2, as amended
                        (Registration No. 333-19081)).
         27             Financial Data Schedule (for SEC use only).
         99.1           Proxy Materials and Proxy for 1999 Annual Shareholders
                        Meeting
</TABLE>

(b)      Reports on Form 8-K filed in the fourth quarter of 1999:  None.

                                      74
<PAGE>   77

                 SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH
                 REPORTS FILED PURSUANT TO SECTION 15(D) OF THE
                     EXCHANGE ACT BY NON-REPORTING ISSUERS


         We have not sent to our security holders any annual report covering
our last fiscal year.

         The proxy statement, form of proxy or other proxy soliciting material
with respect to the 1999 annual or other meeting of shareholders is filed
herewith as Exhibit 99.1.

         If such report or proxy material is furnished to security holders
subsequent to the filing of this Form 10-KSB, we shall furnish copies of such
material to the Securities and Exchange Commission when it is sent to security
holders.

                                      75
<PAGE>   78

                                   SIGNATURES

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

                                       GBC BANCORP, INC.


                                       By: /s/ Larry D. Key
                                          ----------------------------------
                                          Larry D. Key, President and Chief
                                          Executive Officer

                                       Date:  March 28, 2000

                                      76
<PAGE>   79

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

<TABLE>
<CAPTION>
               Signature                                Title                                  Date
               ---------                                -----                                  ----
<S>                                       <C>                                              <C>
 /s/ Larry D. Key                         President, Chief Executive Officer               March 28, 2000
-----------------------------------       and  Chairman of the Company and the
Larry D. Key                              Bank

 /s/ John T. Hopkins III                  Executive Vice President, Chief                  March 28, 2000
-----------------------------------       Financial Officer, Secretary and
John T. Hopkins III                       Treasurer of the Company and the Bank

 /s/ James B. Ballard                     Director of the Company and the Bank             March 28, 2000
-----------------------------------
James B. Ballard

 /s/ Jerry M. Boles                       Director of the Company and the Bank             March 28, 2000
-----------------------------------
Jerry M. Boles

 /s/ W. H. Britt                          Director of the Company and the Bank             March 28, 2000
-----------------------------------
W. H. Britt

 /s/ Richard F. Combs                     Director of the Company and the Bank             March 28, 2000
-----------------------------------
Richard F. Combs

 /s/ William G. Hayes                     Director of the Company and the Bank             March 28, 2000
-----------------------------------
William G. Hayes

 /s/ Douglas A. Langley                   Director of the Company and the Bank             March 28, 2000
-----------------------------------
Douglas A. Langley

 /s/ Norris J. Nash                       Director of the Company and the Bank             March 28, 2000
-----------------------------------
Norris J. Nash

 /s/ J. Joseph Powell                     Director of the Company and the Bank             March 28, 2000
-----------------------------------
J. Joseph Powell

 /s/ William S. Stanton, Jr.              Director of the Company and the Bank             March 28, 2000
-----------------------------------
William S. Stanton, Jr.
</TABLE>

                                      77
<PAGE>   80

                                 EXHIBIT INDEX
<TABLE>
<CAPTION>
         Exhibit
         Number                   Description
         -------                  -----------
         <S>             <C>
         3.1             Articles of Incorporation of the Company, as
                         amended (filed as Exhibit 3.1 to the
                         Registration Statement on Form SB-2, as amended
                         (Registration No. 333-19081)).
         3.2             Amended and Restated Bylaws of the Company
         4.1             Specimen Common Stock Certificate (filed as
                         Exhibit 4.2 to the Registration Statement on
                         Form SB-2, as amended (Registration No. 333-
                         19081)).
         4.2             10.1 Escrow Agreement between the Registrant and
                         Columbus Bank and Trust Company (filed as Exhibit
                         10.1 to the Registration Statement on Form SB-2, as
                         amended (Registration No. 333-19081)).
         10.2            Line of Credit Promissory Note in the amount of
                         $500,000 having Registrant as Maker and Gwinnett
                         Banking Company GBC LLC as Holder (filed as Exhibit
                         10.2 to the Registration Statement on Form SB-2, as
                         amended (Registration No. 333-19081)).
         10.3            Provesa, Inc. Data Processing Agreement (filed as
                         Exhibit 10.3 to the Registration Statement on Form
                         SB-2, as amended (Registration No. 333-19081)).
         10.4            Real Estate Commercial Lease Contract dated as of
                         January 1, 2000, by and between GBC Properties, LLC
                         and Gwinnett Banking Company.
         21.1            Subsidiaries of the Registrant (filed as Exhibit 21.1
                         to the Registration Statement on Form SB-2, as
                         amended (Registration No. 333-19081)).
         27              Financial Data Schedule.
         99.1            Proxy Materials and Proxy for 1999 Annual Shareholders
                         Meeting
</TABLE>

                                      78