SECURITIES AND EXCHANGE COMMISSION
                              Washington D.C. 20549

                                   FORM 10-QSB

  [U] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934

          For the quarterly period ended   December 31, 2002
                                           -----------------
                                       OR
  [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934

         For the transition period from                   to
                                        -----------------

                           Commission File No: 0-24479

                               AF FINANCIAL GROUP
                               ------------------
        (Exact name of small business issuer as specified in its charter)

         Federally Chartered                      56-2098545
         -------------------                      ----------
(State or other jurisdiction of       (I.R.S. Employer Identification No.)
 incorporation or organization)

                              21 East Ashe Street
                      West Jefferson, North Carolina 28694
                      ------------------------------------
               (Address of principal executive office) (Zip code)

                                 (336) 246-4344
                           (Issuer's telephone number)

                               AF Bankshares, Inc.
                               -------------------
   (Former name, former address and former fiscal year, if changed since last
                                     report)

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

As of January 31, 2003 there were 1,053,678 shares of the Registrant's common
stock issued and 1,049,838 shares of the Registrant's common stock outstanding,
$.01 par value

Transitional Small Business Disclosure Format: Yes       No    U
                                                   ---        ---


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                               AF FINANCIAL GROUP
                                    CONTENTS


PART I - FINANCIAL INFORMATION                                                          Pages
                                                                                        -----

         Item 1.  Financial Statements
<S>                                                                                   <C>
Condensed Consolidated Statements of Financial Condition as of
December 31, 2002 (unaudited) and June 30, 2002                                         1
Condensed Consolidated Statements of Income and Comprehensive Income for
the Three and Six Months ended December 31, 2002 and 2001 (unaudited)                   2
Condensed Consolidated Statements of Cash Flows for the Six Months ended
December 31, 2002 and 2001 (unaudited)                                                  3 - 4

Notes to Condensed Consolidated financial statements                                    5 - 8

Item 2.  Management's Discussion and Analysis                                           9 - 14
         Item 3.  Controls and Procedures                                               14-15

PART II - OTHER INFORMATION

         Item 1.  Legal Proceedings                                                     16
         Item 2.  Changes in Securities and Use of Proceeds                             16
         Item 3.  Defaults upon Senior Securities                                       16
         Item 4.  Submission of Matters to a Vote of Security Holders                   16
         Item 5.  Other Information                                                     16
         Item 6.  Exhibits and Reports on Form 8-K                                      16
         Signatures                                                                     17
</TABLE>
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<TABLE>
<CAPTION>
AF FINANCIAL GROUP AND SUBSIDIARIES


CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
December 31, 2002 and June 30, 2002


ASSETS
                                                                 December 31,     June 30,
                                                                    2002            2002
---------------------------------------------------------------------------------------------
                                                                 (Unaudited)        Note
<S>                                                          <C>               <C>
Cash and cash equivalents:
   Interest-bearing deposits                                 $      1,024,220  $    4,868,508
   Noninterest-bearing deposits                                     8,995,106       6,351,065
Securities held to maturity                                           100,000         100,000
Securities available for sale                                       6,843,693      10,272,145
Federal Home Loan Bank stock                                        1,357,400       1,049,400
Loans receivable, net                                             154,263,756     143,553,436
Real estate owned                                                       3,800         263,035
Office properties and equipment, net                                7,382,579       5,972,706
Accrued interest receivable on loans                                  895,244         857,311
Accrued interest receivable on investment securities                   84,118         128,396
Prepaid expenses and other assets                                   1,481,294       1,569,957
Deferred income taxes, net                                            443,417         460,019
Intangible assets                                                   1,615,446       1,615,446
                                                                ------------------------------
                              Total assets                   $    184,490,073  $  177,061,424
                                                                ==============================

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
   Savings deposits                                          $    142,330,299  $  136,768,838
   Note payable                                                     1,280,676       1,264,624
   Note payable - ESOP                                                144,420         181,420
   Advances from Federal Home Loan Bank                            21,146,566      18,909,924
   Accounts payable and other liabilities                           1,327,992       1,768,576
   Redeemable common stock held by the ESOP, net of
      unearned ESOP shares                                            383,890         391,239
  Capital Securities                                                5,000,000       5,000,000
                                                                ------------------------------
                              Total liabilities                   171,613,843     164,284,621
                                                                ------------------------------

Commitments and Contingencies

Stockholders' Equity:
    Commonstock, par value $.01 per share; authorized 5,000,000 shares;
          1,053,678 issued and 1,049,838 outstanding shares
          at December 31, 2002 and June 30, 2002                       10,537          10,537
   Additional paid-in capital                                       4,609,858       4,602,930
   Retained earnings, substantially restricted                      8,267,511       8,200,866
   Accumulated other comprehensive income (loss)                       63,204          37,350
                                                                ------------------------------
                                                                   12,951,110      12,851,683
    Less the cost of 3,840 shares of treasury stock                   (74,880)        (74,880)
                                                                ------------------------------
                              Total stockholders' equity           12,876,230      12,776,803
                                                                ------------------------------
                                                                ------------------------------
                              Total liabilities and
                              stockholders' equity           $    184,490,073  $  177,061,424
                                                                ==============================
</TABLE>

See Notes to Condensed Consolidated Financial Statements.

Note: The Condensed Consolidated Statement of Financial Condition as of June 30,
2002 has been taken from audited financial statements at that date.

<PAGE>
<TABLE>
<CAPTION>
AF FINANCIAL GROUP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED)
Three and Six Months Ended December 31, 2002 and 2001

                                               Three Months Ended     Six Months Ended
                                                  December 31,          December 31,
-----------------------------------------------------------------------------------------
                                                2002       2001       2002        2001
-----------------------------------------------------------------------------------------

Interest and dividend income:


<S>                                          <C>        <C>        <C>        <C>
   Loans                                     $2,841,397 $2,661,260 $5,589,118 $ 5,407,780
   Investment securities                         94,004    151,632    189,465     292,472
   Interest bearing deposits                     13,262     48,978     25,524     124,861
                                              --------------------- ---------------------
                   Total interest income      2,948,663  2,861,870  5,804,107   5,825,113
                                              --------------------- ---------------------

Interest expense:
   Deposits                                     893,088  1,122,661  1,786,444   2,395,166
   Federal Home Loan Bank advances              270,679    233,563    523,531     467,503
   Notes payable                                 17,661     18,287     34,546      38,127
   Capital Securities                           129,510    127,996    259,827     241,449
                                              --------------------- ---------------------
                                              1,310,938  1,502,507  2,604,348   3,142,245
                                              --------------------- ---------------------
                   Net interest income        1,637,725  1,359,363  3,199,759   2,682,868
Provision for loan losses                        35,200    136,000    147,700     288,900
                                              --------------------- ---------------------
                   Net interest income
                   after provision for
                   loan losses                1,602,525  1,223,363  3,052,059   2,393,968
                                             --------------------- ----------------------

Noninterest income:
   Insurance commissions                        567,168    496,664  1,129,300     991,196
   Gain on sale of investments
   available for sale                               -      138,997        -       138,997
   Other                                        269,342    224,920    558,883     414,710
                                              --------------------- ---------------------
                                                836,510    860,581  1,688,183  1,544,903
                                              --------------------- ---------------------
Noninterest expense:
   Compensation and employee benefits         1,399,041  1,352,344  2,713,344   2,550,768
   Occupancy and Equipment                      282,652    248,935    562,417     479,791
   Deposit insurance premiums                     5,688      5,414     11,420      11,069
   Computer processing charges                  135,057    124,911    268,856     236,839
   Amortization                                     -       39,156        -        75,145
   Other                                        470,061    443,849    904,251     811,148
                                              --------------------- ---------------------
                                              2,292,499  2,214,609  4,460,288   4,164,760
                                              --------------------- ---------------------
                   Income (loss) before
                   income taxes:                146,536   (130,665)   279,954   (225,889)
   Income taxes                                  74,930    (50,953)   136,198    (88,234)
                                              --------------------- ---------------------
                   Net income (loss)             71,606    (79,712)   143,756   (137,655)
                                              --------------------- ---------------------
   Other comprehensive income (loss), net of tax:

     Unrealized gain (loss) on securities, net
     of tax:                                    (18,490)  (129,694)    25,854    (70,593)

     Less:  reclassification adjustment for
     gains included in net income,
     net of tax                                     -       95,908        -       95,908
                                              --------------------- ---------------------
                  Comprehensive income (loss)$   53,116 $ (305,314)$  169,610  $(304,156)
                                              ========== ========== ==========  =========

   Basic Earnings per share of common stock
   (Note 3)                                  $     0.07      (0.08)      0.14  $   (0.13)
                                              ========== ========== ==========  =========
   Diluted Earnings per share of common stock
   (Note                                     $     0.07      (0.08)      0.14 $    (0.13)
                                              ========== ========== ==========  =========
   Cash dividends per share                  $     0.05       0.05       0.10  $    0.10
                                              ========== ========== ==========  =========
</TABLE>


   See Notes to Condensed Consolidated Financial Statements.



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<TABLE>
<CAPTION>
AF FINANCIAL GROUP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
SIX MONTHS ENDED DECEMBER 31, 2002 AND 2001
                                                                                               Six Months Ended
                                                                                           2002                 2001
---------------------------------------------------------------------------------------------------------------------------
<S>                                                                             <C>                   <C>
Cash Flows from Operating Activities
    Net income (loss)                                                           $           143,756   $         (137,655)
    Adjustments to reconcile net income (loss) to net cash
       provided by operating activities:
       Provision for loan losses and REO                                                    147,700             288,900
       Provision for depreciation                                                           380,451             296,248
       Amortization of goodwill and non compete covenants                                       -               75,146
       Change in operating assets and liabilities:
           Accrued interest receivable                                                        6,345               1,374
           Accrued interest payable                                                         135,137             (45,198)
           Prepaid and other assets                                                          76,671            (119,286)
           Accounts payable and other liabilities                                          (440,584)           (406,358)
           Other                                                                             74,937             154,483
                                                                                ---------------------------------------
                         NET CASH PROVIDED BY OPERATING ACTIVITIES                          524,413             107,654
                                                                                ---------------------------------------
Cash Flows from Investing Activities
    Increase in Federal Home Loan Bank stock                                               (308,000)                -
    Purchases of securities available for sale                                           (1,235,000)         (4,653,681)
    Proceeds from securities available for sale                                           4,661,817           2,391,477
    Net originations of loans receivable                                                (10,858,020)         (7,933,071)
    Purchases of office properties and equipment                                         (1,796,887)         (1,087,337)
    Purchase of goodwill and noncompete agreements                                              -              (190,000)
    Proceeds from sale of properties and equipment                                            6,562                 -
    Proceeds from sale of real estate owned                                                 253,837                 -
                                                                                ---------------------------------------
                         NET CASH USED IN INVESTING ACTIVITIES                           (9,275,691)        (11,472,612)
                                                                                ---------------------------------------
Cash Flows from Financing Activities
    Net increase in savings deposits                                                      5,438,316           9,022,624
    FHLB Advances                                                                         2,236,642             (25,787)
    Notes Payable                                                                           (20,948)           (128,199)
    Proceeds from capital securities                                                             -            5,000,000
    Dividends paid                                                                         (102,979)           (103,612)
                                                                                ---------------------------------------
                         NET CASH PROVIDED BY FINANCING ACTIVITIES                        7,551,031          13,765,026
                                                                                ---------------------------------------
                         NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS            (1,200,247)          2,400,068
Cash and cash equivalents:
    Beginning                                                                            11,219,573          12,567,765
                                                                                ---------------------------------------

    Ending                                                                      $        10,019,326   $      14,967,833
                                                                                =======================================

</TABLE>

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<TABLE>
<CAPTION>
AF FINANCIAL GROUP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (CONTINUED)
SIX MONTHS ENDED DECEMBER 31, 2002 AND 2001

                                                                                     2002                  2001
------------------------------------------------------------------------------------------------------------------------
<S>                                                                         <C>                   <C>
Supplemental Schedule of Cash and Cash Equivalents
    Cash:
       Interest-bearing deposits                                            $           1,024,220 $           7,443,192
       Noninterest-bearing                                                              8,995,106             7,524,641
                                                                              ------------------------------------------
                                                                            $          10,019,326 $          14,967,833
                                                                              ==========================================
Supplemental Disclosures of Cash Flow Information
    Cash payments for:
       Interest                                                             $           2,469,211 $           2,823,778
                                                                              ==========================================
       Income taxes                                                         $                 293 $             133,672
                                                                              ==========================================

See Notes to Condensed Consolidated Financial Statements.

</TABLE>





<PAGE>

                               AF FINANCIAL GROUP
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



NOTE 1.NATURE OF BUSINESS

AF Financial Group (the "Company") is a federally chartered stock holding
company for AF Bank (the "Bank"), which conducts business from its main office
located in West Jefferson, North Carolina, with branches in Boone, Jefferson,
Sparta, Warrensville, and West Jefferson, North Carolina. The Company has an
insurance subsidiary headquartered in West Jefferson, North Carolina, operating
as AF Insurance Services, Inc. with branches in Boone, Elkin, Jefferson, Lenoir,
Sparta, West Jefferson, and Wilkesboro, North Carolina. The Company has a
brokerage service subsidiary headquartered in West Jefferson, North Carolina,
operating as AF Brokerage, Inc., which serves Ashe, Alleghany, Wilkes and
Watauga counties; as well as Union County, North Carolina, through a third party
arrangement with a bank in Monroe, North Carolina.

On April 15, 1996, the Board of Directors of Ashe Federal Bank adopted a Plan of
Reorganization and the related Stock Issuance Plan pursuant to which the Bank
exchanged its federal mutual savings bank charter for a federal stock savings
bank charter, conducted a minority stock offering and formed AsheCo, MHC a
mutual holding company which owned more than 50% of the common stock issued by
the Bank. The Bank conducted its minority stock offering in July and August of
1996 and the closing occurred on October 4, 1996. The Bank sold 461,779 shares
of common stock in the minority stock offering, which includes 36,942 shares
sold to its Employee Stock Ownership Plan (the "ESOP"), and issued 538,221
shares to the mutual holding company.

At the Bank's annual meeting held on December 8, 1997, the shareholders of Ashe
Federal Bank approved the Ashe Federal Bank 1997 Stock Option Plan; the Ashe
Federal Bank 1997 Recognition and Retention Plan; a change in the Bank's federal
stock charter, changing the corporate name to AF Bank; and approved a plan of
reorganization providing for the establishment of AF Bankshares, Inc., as a
federally chartered stock holding company and parent of the Bank. On June 16,
1998, the Bank completed its reorganization into a two-tier mutual holding
company and became a wholly owned subsidiary of the Company as the Company
became a majority owned subsidiary of AsheCo, MHC.

At the Company's annual meeting held on November 4, 2002, stockholders approved
a resolution to amend Section I of the Company's federal stock charter to change
the Company's name from AF Bankshares, Inc. to AF Financial Group. Management
believes that the name "AF Financial Group" more accurately reflects its
transition from banking to financial services provider and that the new name
will assist potential clients and customers in recognizing the Company as a full
service financial services provider.

Management believes that the Company's customers perceive "financial services"
to encompass five broad categories: funds transfer including checking accounts;
insured savings instruments; credit/lending services; insurance; and securities
brokerage. Further, management believes that failure to offer insurance and
brokerage services in addition to traditional `banking only' services would
impair the Company's growth and make retention of existing customers more
difficult. The Company continues to seek opportunities to increase

                                       5
<PAGE>

market penetration for its products and services, primarily in northwestern
North Carolina. During the three-month period ending September 30, 1998, the
Company established a securities brokerage subsidiary, AF Brokerage, Inc., that
currently conducts brokerage services from two offices in West Jefferson, and by
appointment in the Company's other office locations. AF Brokerage, Inc. applied
to the NASD for membership in the third quarter of 1998 and was granted
membership on October 22, 1999. AF Brokerage, Inc. commenced operation in the
fourth quarter of 2000 as an independent broker/dealer. During the fiscal year
ended June 30, 2002, AF Brokerage entered into a service contract with a
non-affiliated community bank in Monroe, North Carolina, to provide investment
services to the bank's customers through a dual employee arrangement. This move
signals the first step in the brokerage firm's intent to enter and expand its
business into the arena of third party providers for non-competitive client
financial institutions in North Carolina.

Management continues to evaluate acquisitions and business opportunities that
will provide access to new customers and expanded markets, which would enhance
the Company's long term value and earnings potential. Management believes that
penetration into new (especially contiguous) markets increases the opportunity
to deliver products from all of the Company's subsidiaries to a broader market
base, thereby making the insurance and brokerage subsidiaries more profitable
investments by increasing the economies of scale, as well as improving the
economies of scope, and at the same time adding to the products that are
available for delivery to the Company's customers.

Of course, management is equally committed to protecting and expanding the
Company's market share in existing markets. As evidence of this continuing
commitment, on October 24, 2001 AF Bank opened the only financial institution
outlet located inside the Wal-Mart in West Jefferson, North Carolina. In May
2002 the Company opened a freestanding full-service branch adjacent to Wal-Mart
in West Jefferson, North Carolina. Thus, customers now enjoy the convenience of
banking inside where they shop, as well as having access to a comprehensive
array of financial services at the freestanding branch office (including an
ATM), drive-through lanes, and a commercial depository. Also, the Company has
just added a new Customer Call Center allowing customers to speak with a banking
representative by phone from 7 a.m. until 10 p.m. Monday through Friday.

During the quarter ended December 31, 2002, the Company added online banking to
the services it currently offers. Later in the year, the Company plans to add
check imaging to its services. Both of these important new services are designed
to both strengthen existing customer financial relationships, as well as attract
new customers and clients. Check imaging will provide the Company's checking
customers with the space-saving option of receiving imaged statements showing
their cancelled checks each month, instead of bulky stacks of returned checks.
And online banking gives customers the ability to bank directly through their
computers -- 24 hours a day, seven days a week.

Additionally, the Company acquired land in Boone, North Carolina to construct a
Financial Service Center which is expected to be completed during the 2004
fiscal year. The new Financial Center is expected to cost approximately $6.7
million and will combine banking, insurance and investments into one convenient
location in the Watagua county market. Two floors of the proposed four-story
facility will be offered for lease to the professional and medical community.
The Company continues to seek opportunities to increase the market penetration
of its services.

                                       6
<PAGE>

During the year ended June 30, 1999, the Company purchased 6,300 shares of its
common stock for a total price of $113,750. In the same year, the Company issued
2,000 of these shares. During the year ended June 30, 2002, the Company issued
460 of these shares. Management does not plan to acquire additional shares until
it has a specific purpose for additional stock purchases.


NOTE 2.   BASIS OF PRESENTATION

The accompanying unaudited financial statements (except for the statement of
financial condition at June 30, 2002, which is extracted from audited financial
statements) have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to Form
10-QSB of Regulation S-B. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all adjustments
(none of which were other than normal recurring accruals) necessary for a fair
presentation of the financial position and results of operations for the periods
presented have been included. The results of operations for the three and six
month period ended December 31, 2002 are not necessarily indicative of the
results of operations that may be expected for the Company's fiscal year ending
June 30, 2003.

The accounting policies followed are as set forth in Note 1 of the Notes to
Financial Statements in the Company's 2002 financial statements, which are
included by reference in the Company's Form 10-KSB for the year ended June 30,
2002.

NOTE 3.   EARNINGS PER SHARE

The Company's basic and diluted earnings per share for the three and six month
period ended December 31, 2002 are based on weighted averages of 1,040,784 and
1,040,320, respectively, assumed to be outstanding for the period. Options to
purchase 21,322 shares of common stock at $18.50 per share were outstanding
during the second quarter of fiscal year ending June 2003, and because the
average market price is lower than the exercise price of $18.50, the incremental
shares, are not considered dilutive and are not included in the calculation of
diluted earnings per share. Shares owned by the Company's ESOP that have not
been committed to be released are not considered to be outstanding for the
purposes of computing earnings per share. Earnings per share have been
calculated in accordance with Statement of Position 93-6 "Employers' Accounting
for Employee Stock Ownership Plans" and Statement of Financial Accounting
Standards Number 128.

NOTE 4.  FEDERAL HOME LOAN BANK ADVANCES AND NOTES PAYABLE

The Company had advances outstanding of $21,146,566 and $18,909,924 at December
31, 2002 and June 30, 2002 respectively, from the Federal Home Loan Bank ("the
FHLB"). Interest at December 31, 2002 is payable at rates ranging from 3.50% to
6.87%. Pursuant to collateral agreements with the FHLB, advances are
collateralized by the Bank's stock in the FHLB and qualifying first mortgage
loans. Advances of $146,566 are due January 2007, $5.0 million is due September
2010, $7.0 million is due November 2010, $4.0 million is due January 2011 and
$5.0 million is due September 2012.

                                       7
<PAGE>

The Company had Notes Payable outstanding of $1,280,676 and $1,264,624 at
December 31, 2002 and June 30, 2002, respectively. Interest at December 31, 2002
is payable at rates ranging from 1.00% to 5.50% with maturities between 1 and 7
years.

NOTE 5.  CAPITAL SECURITIES

On July 16, 2001, AF Capital Trust (the "Trust"), a Delaware business trust
formed by the Company, completed the sale of $5.0 million of 10.25% Capital
Securities (liquidation amount of $1,000 per security) (the "Capital
Securities") in a private placement as part of a pooled capital securities
transaction. The Trust also issued Common Securities to the Company and used the
net proceeds from the offering to purchase a like amount of 10.25% Junior
Subordinated Deferrable Interest Debentures (the "Subordinated Debentures") of
the Company. The Subordinated Debentures are the sole assets of the Trust and
are eliminated, along with the related income statement effects, in the
consolidated financial statements of the Company. The Company contributed $3.0
million of the proceeds from the sale of the Subordinated Debentures to the Bank
as Tier I Capital to support the Bank's growth. Total expenses associated with
the offering approximating $185,137 were included in other assets and are being
amortized on a straight-line basis over the life of the Subordinated Debentures.

The Capital Securities accrue and pay distributions semi-annually on January
25th and July 25th of each year, commencing on January 25, 2002 at a fixed
annual rate of 10.25% of the stated liquidation amount of $1,000 per Capital
Security. The Company has fully and unconditionally guaranteed all of the
obligations of the Trust, including the semi-annual distributions and payments
on liquidation or redemption of the Capital Securities.

The Capital Securities are mandatorily redeemable upon the maturing of the
Subordinated Debentures on July 25, 2031 or upon earlier redemption as provided
in the Indenture. The Company has the right to redeem the Subordinated
Debentures, in whole or in part, on any January 25th or July 25th on or after
July 25, 2006 at the liquidation amount, plus any accrued but unpaid interest to
the redemption date.

NOTE 6.  DIVIDENDS DECLARED

On December 16, 2002, the Board of Directors of the Company declared a dividend
of $0.05 a share for stockholders of record as of December 19, 2002 and payable
on January 2, 2003. The dividends declared were accrued and reported in accounts
payable and other liabilities in the December 31, 2002 Consolidated Statement of
Financial Condition. AsheCo, MHC, the mutual holding company, did not waive the
receipt of dividends declared by the Company.

NOTE 7.  GOODWILL AND OTHER INTANGIBLE ASSETS

On July 1, 2002, the Company adopted the provisions of Financial Accounting
Standards Board Statement 142, GOODWILL AND OTHER INTANGIBLE ASSETS. Under the
provisions of the Statement, on July 1, 2002, the Company eliminated the
amortization of goodwill and other intangibles that are determined to have an
indefinite life. On December 31, 2002, the Company had no impairment of
goodwill, but will reevaluate the carrying value of goodwill and other
intangible assets at least annually. The Company expects to perform this
reevaluation as of March 31 in each of its fiscal years.



                                       8
<PAGE>
                               AF FINANCIAL GROUP
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

THIS FORM 10-QSB CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS CONSISTING OF
ESTIMATES WITH RESPECT TO THE FINANCIAL CONDITION, RESULTS OF OPERATIONS AND
OTHER BUSINESS OF THE COMPANY, THAT ARE SUBJECT TO VARIOUS FACTORS WHICH COULD
CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE ESTIMATES. THESE FACTORS
INCLUDE: CHANGES IN GENERAL, ECONOMIC AND MARKET CONDITIONS; THE DEVELOPMENT OF
AN ADVERSE INTEREST RATE ENVIRONMENT THAT ADVERSELY AFFECTS THE INTEREST RATE
SPREAD OR OTHER INCOME ANTICIPATED FROM THE COMPANY'S OPERATIONS AND
INVESTMENTS; AND DEPOSITOR AND BORROWER PREFERENCES. THE COMPANY DISCLAIMS ANY
OBLIGATION TO PUBLICLY ANNOUNCE FUTURES EVENTS OR DEVELOPMENTS THAT MAY AFFECT
THE FORWARD-LOOKING STATEMENTS CONTAINED HEREIN.

BACKGROUND AND INTRODUCTION

Management believes it is important to view the quarterly financial results of
the Company within the larger context of the Company's long-term strategic
business plan. Doing so helps keep short-term results in better perspective, and
underscores management's commitment to the LONG-TERM profitability and success
of the Company.

It is management's view that the Company's success in the 21st Century will
depend in large part upon its ability to compete far beyond the narrow
boundaries imposed upon banking during most of the 20th Century. In fact, the
transition from "banking" to "financial services provider" impacted every major
competitor of the Company. The Gramm-Leach-Bliley Financial Services
Modernization Act is an excellent example of regulatory and governmental support
of this viewpoint.

Management has long recognized the dramatically changing dynamics of the
delivery system for financial services in this country. Both individuals and
businesses now look to a broadening array of sources for needed (or wanted)
financial products. Individuals and families are opening FDIC insured savings
accounts at brokerage houses; they are purchasing mutual funds and annuities
through offices of banking organizations; and they are using the services of
non-bank financial planners to plan their retirements and their children's
education needs. Companies are increasingly taking their cash management
function to independent brokers or insurance company representatives; they are
investing idle cash through discount brokerages on the internet; and they are
establishing letters and lines of credit with investment bankers, indirect
credit companies and others.

The Company now has a foundation to successfully compete in its established
markets. In all AF Bank markets, the Company has the capability to deliver
comprehensive insurance services through its insurance subsidiary and the
potential to deliver securities services through AF Brokerage, Inc. In order to
project an imagine as a full service financial provider to potential clients and
customers, the Company's stockholders approved a resolution to amend the
Company's federal stock charter to change the Company's name from AF Bankshares,
Inc. to AF Financial Group. The challenge facing management is to provide the
most economical, efficient - and most importantly - DESIRABLE platform to offer
AF customers, clients and prospects these services. It is a challenge management
is working hard to meet.

To enhance and expand its service delivery channels, the Company recently
introduced a new Call Center, allowing banking customers access to a live
banking representative by telephone from 7 a.m. until 10 p.m., Monday through
Friday and Online Banking to provide customers with the ability to bank direct
through their computers 24 hours a day, seven days a week. Also, Check Imaging
is scheduled for introduction during the current fiscal year, giving

                                       9
<PAGE>

checking customers the added option of receiving imaged statements showing all
their cancelled checks -- instead of bulky stacks of returned checks each month.
These, and other planned improvements, are all intended to improve the viability
and DESIRABILITY of the Company's delivery platform.

In coming years, management believes that the Company's established foundation
and emerging platform will drive the Company's long-term viability as a
competitively superior financial services provider in all markets.

COMPARISON OF FINANCIAL CONDITION AT DECEMBER 31, 2002 AND JUNE 30, 2002:

Total assets increased by $7.4 million, or 4.2%, to $184.5 million at December
31, 2002 from $177.1 million at June 30, 2002. The increase in assets was
primarily the result of an increase of $10.7 million, or 7.5%, in loans
receivable, net and an increase of $1.4 million, or 23.6%, in office properties
and equipment, net, from June 30, 2002 to December 31, 2002. The increase in net
loans receivable is typical for the Bank, which operates in lending markets that
have had sustained loan demand over the last several years. The increase in net
office properties and equipment was primarily due to the purchase of property in
Boone, North Carolina to construct a new Financial Service Center. Increases in
net loans outstanding and net office properties and equipment, were primarily
funded by an increase of $5.6 million in savings deposits and a $2.2 million
increase in advances from the Federal Home Loan Bank.

Securities available for sale decreased $3.4 million or 33.4% to $6.8 million at
December 31, 2002 from $10.3 million at June 30, 2002. This decrease was due to
maturing investments and management's decision to use the liquidity to fund loan
demand. At December 31, 2002, the Company's investment portfolio had
approximately $63,204 in net unrealized gains.

The Bank's deposits increased by $5.6 million, or 4.1%, from $136.8 million at
June 30, 2002 to $142.3 million at December 31, 2002. Management believes that
the increase in deposits is attributable to its continuing marketing efforts
directed towards increasing balances in savings and transaction accounts and in
smaller, stable certificates of deposits. Management intends to focus its
marketing efforts and to offer new products to increase the lower cost core
deposits.

At December 31, 2002, retained earnings had increased $66,645, or 0.8%, to $8.3
million as a result of net income of $143,756, an increase for the fair market
value for ESOP stock in the amount of $25,868, and a reduction for dividends of
$102,979. At December 31, 2002, the Bank's regulatory capital amounted to $17.0
million compared to $16.6 million at June 30, 2002, which was in excess of
regulatory capital requirements at such date.

The Bank's level of non-performing loans, defined as loans past due 90 days or
more, increased to $806,550 at December 31, 2002 compared to $460,041 at June
30, 2002. The Bank recognized net charge offs of approximately $154,044 during
the six-month period ended December 31, 2002 compared to net charge offs of
$210,300 for the comparable period ended December 31, 2001. The level of net
charge offs was attributable to recent negative economic events on the local
level, principally related to factory closings in two of the Company's primary
markets and the higher unemployment due to the closings. As a result and based
on management's analysis of its allowances, a $147,700 provision for loan loss
allowance was made during the six-month period ended December 31, 2002. Similar
loan loss provisions in future periods are uncertain; however, management
expects to have a similar level of provision expense for the third quarter of
the current fiscal year.


                                       10
<PAGE>
COMPARISON OF OPERATING RESULTS FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31,
2002 AND 2001:

The Company had net income for the three-month period ended December 31, 2002 of
$71,606 compared a net loss of $79,712 during the same period in 2001. The
Company had net income of $143,756 for the six-month period ended December 31,
2002 compared to a net loss of $137,655 during the six-month period ended
December 31, 2001. Changes in net income during the comparable three and six
month periods were attributable to: an increase in the net interest income after
provision for loan losses and an increase in insurance commissions. The
increases in income were partially offset by increased compensation expense,
occupancy expenses and computer processing charges associated with the
remodeling costs of the Sparta facility and the new Financial Center located on
Mount Jefferson Road in West Jefferson, North Carolina. In management's opinion,
there has not been a material change in interest rate risk from the end of the
Company's most recent fiscal year.

INTEREST INCOME. Interest income increased by $86,793 or 3.0% from $2,861,870
for the three-month period ended December 31, 2001 to $2,948,663 for the
three-month period ended December 31, 2002. Interest income decreased by $21,006
or 0.4% from $5,825,113 for the six-month period ended December 31, 2001 to
$5,804,107 for the six-month period ended December 31, 2002. Interest income
from loans increased $180,137 or 6.8% from $2,661,260 for the three-month period
ended December 31, 2001 to $2,841,397 for the three-month period ended December
31, 2002. Interest income from loans increased $181,338 or 3.4% from $5,407,780
for the six-month period ended December 31, 2001 to $5,589,118 for the six-month
period ended December 31, 2002. The increase in interest income from loans was
attributable to a change in the volume and rate of net loans receivable and was
offset by decreases in interest income from investment securities and interest
bearing accounts in the three and six month period ended December 31, 2002. Even
though the weighted average rate on portfolio loans declined from the prior
periods, the interest income from the increase in outstanding balances out
weighs the decline in income resulting from the decline in the weighted average
rate; therefore, during the current period income generated from the increase in
balances (volume) offset the decline in earnings resulting from the decline in
weighted average rate.

INTEREST EXPENSE. Interest expense decreased by $191,569 or 12.8% to $1,310,938
for the three-month period ended December 31, 2002 from $1,502,507 for the three
months ended December 31, 2001. Interest expense decreased by $537,897 or 17.1%
to $2,604,348 for the six-month period ended December 31, 2002 from $3,142,245
for the six-month period ended December 31, 2001. Interest expense on deposits
decreased by $229,573 or 20.5% to $893,088 for the three months ended December
31, 2002 from $1,122,661 for the three months ended December 31, 2001. This
decrease is the result of the 0.7% decrease in the institution's weighted
average rate of deposits during the twelve-month period ended December 31, 2002.

NET INTEREST INCOME. Net interest income increased by $278,362 or 20.5% from
$1,359,363 for the three-month period ended December 31, 2001 to $1,637,725 for
the three-month period ended December 31, 2002. Net interest income increased by
$516,891 or 19.3% from $2,682,868 for the six-month period ended December 31,
2001 to $3,199,759 for the six-month period ended December 31, 2002. The
increase is a result of a drop in the institution's weighted average rate paid
for deposits, partially offset by the reduction of the weighted average loan
rates and the increase in net loans outstanding.

                                       11
<PAGE>
PROVISION FOR LOAN LOSSES. Management made additional provision in the amount of
$35,200 to the allowance for loan losses during the three-month period ended
December 31, 2002, compared to a $136,000 provision for loan losses made during
the three-month period ended December 31, 2001. Management made additional
provision in the amount of $147,700 to the allowance for loan losses during the
six-month period ended December 31, 2002, compared to a $288,900 provision for
loan losses made during the six-month period ended December 31, 2001.
Provisions, which are charged to operations and resulting loan loss allowances,
are amounts that the Bank's management believes will be adequate to absorb
potential losses on existing loans that may become uncollectible. Loans are
charged off against the allowance when management believes that collection is
unlikely. The evaluation to increase or decrease the provisions and resulting
allowances is based both on prior loan loss experience and other factors, such
as changes in the nature and volume of the loan portfolio, overall portfolio
quality and current economic conditions.

The Bank made provisions for loan loss allowances during the three and six month
period ended December 31, 2002 based upon an analysis of the quality of its loan
portfolio. At December 31, 2002, the Bank's level of general valuation
allowances for loan losses amounted to $1.2 million which management believes is
adequate to absorb any existing losses in its loan portfolio.

NON-INTEREST INCOME. Non-interest income decreased by $24,071 or 2.8% from
$860,581 for the three-month period ended December 31, 2001 to $836,510 for the
three months ended December 31, 2002. Non-interest income increased by $143,280
or 9.3% from $1,544,903 for the six-month period ended December 31, 2001 to
$1,688,183 for the six-month period ended December 31, 2002. Non-interest income
for the three months ended December 31, 2002 decreased because the Company did
not make any sales of investment securities during the three-month period ended
December 31, 2002 compared to a gain of $138,997 being recognized during the
three-month period ended December 31, 2001. Rather than take gains on sale of
securities, management allowed investment securities to mature. As investment
securities matured, the Company used the liquidity to fund loan growth rather
than the purchase of investment securities. The decrease in non-interest income
was partially offset by an increase of $70,504 in insurance commissions. The
increase in non-interest income during the six-month period ended December 31,
2002 was primarily attributable to increased revenues generated from insurance
sales and increases in transaction fees on deposit accounts during the six
months ended December 31, 2002. The increased revenue generated from insurance
sales is due to widening market penetration and increase in premiums and is
expected to continue to produce new growth in non-interest income. The increase
in transaction fees on deposit accounts is primarily attributable to an increase
in the number of transaction accounts and more aggressive collection efforts.

 NON-INTEREST EXPENSE. Non-interest expense increased by $77,890 or 3.5% from
$2,214,609 for the three months ended December 31, 2001 to $2,292,499 for the
three months ended December 31, 2002. Non-interest expense increased by $295,528
or 7.1% from $4,164,760 for the six-month period ended December 31, 2001 to
$4,460,288 for the six-month period ended December 31, 2002. Increases in
non-interest expense for the three and six month period ended December 31, 2002
are primarily attributable to an increase in compensation costs, occupancy
expenses and computer processing charges associated with the remodeling costs of
the Sparta facility and increased staffing for the Financial Service Center
located on Mount Jefferson Road West Jefferson, North Carolina. Compensation
costs increased by $46,697 or 3.5% for the three-month period ended December 31,
2002. Compensation costs increased $162,576 or 6.4% for the six-month period
ended December 31, 2002. Occupancy costs

                                       12
<PAGE>
increased by $33,717 or 13.5% for the three-month period ended December 31,
2002. Occupancy costs increased by $82,626 or 17.2% for the six-month period
ended December 31, 2002.

CAPITAL RESOURCES AND LIQUIDITY:

The term "liquidity" generally refers to an organization's ability to generate
adequate amounts of funds to meet its needs for cash. More specifically for
financial institutions, liquidity ensures that adequate funds are available to
meet deposit withdrawals, fund loan demand and capital expenditure commitments,
maintain reserve requirements, pay operating expenses, and provide funds for
debt service, dividends to stockholders, and other institutional commitments.
The Company's primary sources of funds consist of deposits, borrowings,
repayment and prepayment of loans, sales and participations of loans, maturities
of securities and interest-bearing deposits, and funds provided from operations.
While scheduled repayments of loans and maturities of securities are predictable
sources of funds, deposit flows and loan prepayments are greatly influenced by
the general level of interest rates, economic conditions, and competition. The
Company uses its liquidity resources primarily to fund existing and future loan
commitments, to fund net deposit outflows, to invest in other interest-earning
assets, to maintain liquidity, and to meet operating expenses. For additional
information about cash flows from the Company's operating, financing and
investing activities, see "Condensed Consolidated Statements of Cash Flow."

Liquidity management is both a daily and long-term function of management. If
the Company requires funds beyond its ability to generate them internally, the
Company believes it could borrow additional funds from the FHLB and use the
wholesale deposit markets. At December 31, 2002, the Company had borrowings of
$21.1 million from the FHLB.

The Company anticipates that it will have sufficient funds available to meet its
current loan origination commitments. Certificates of deposit scheduled to
mature in one year or less totaled $50.5 million at December 31, 2002. Based
upon historical experience, management believes that a significant portion of
such deposits will remain with the Bank.

As of December 31, 2002, cash and cash equivalents, a significant source of
liquidity, totaled $10.0 million. The OTS regulations require the Company to
maintain sufficient liquidity to ensure its safe and sound operation. The
Company's liquidity position is in excellent shape by any objective benchmark or
comparison.


ASSET/LIABILITY MANAGEMENT.

The Company's asset/liability management is focused primarily on evaluating and
managing the Company's net interest income in relation to various risk criteria.
Factors beyond the Company's control, such as the effects of changes in market
interest rates and competition, may also have an impact on the management of
interest rate risk.

In the absence of other factors, the Company's overall yield on interest-earning
assets will increase as will its cost of funds on its interest-bearing
liabilities when market rates increase over an extended period of time.
Inversely, the Company's yields and cost of funds will decrease when market
rates decline. The Company is able to manage these fluctuations to some extent
by attempting to control the maturity or rate adjustments of its
interest-earning assets and interest-bearing liabilities over given periods of
time. One of the Company's tools

                                       13
<PAGE>
to monitor interest rate risk is the measurement of sensitivity of its net
portfolio value to changes in interest rates.

In order to minimize the potential effects of adverse material and prolonged
increases in market interest rates on the Company's operations, management has
implemented an asset/liability program designed to improve the Company's
interest rate risk exposure. The program emphasizes the originations of three
and five-year fixed rate balloon mortgages, adjustable rate mortgages, selling
long term fixed rate loans to the secondary market, shorter term consumer and
commercial loans, the investment of excess cash in short or intermediate term
interest-earning assets and the solicitation of deposit accounts that can be
repriced rapidly.

Although the Company's asset/liability management program has generally helped
to decrease the exposure of its earnings to interest rate increases, the
residual effect of reducing the Company's historical exposure to interest rate
increases is a heightened exposure to interest rate decreases. Additionally, a
decline in rates for earning assets may occur more rapidly than a decline in
funding costs. Certificates of deposit represent the most interest sensitive
funding products and typically have terms ranging from three to thirty six
months. Consequently, the rates paid for these deposits cannot be adjusted until
the maturity date. Loans priced at prime or a margin thereto provide for
adjusting rates immediately when market rates change. In a rising rate
environment, that ability to make immediate rate adjustments serves to protect
the net interest margin against increases in rates at a more rapid speed than
the increase in funding. In a declining rate environment, the rates on prime
rate based loans decrease immediately while certificate rates lag causing the
interest margin to decline until the certificates mature offering an opportunity
for repricing.

Management believes that the Company's asset/liability management program
continues to function as a useful financial management tool; adequately
providing for the safe, sound and prudent management of the Company's exposure
to changes in interest rates.

IMPACT OF INFLATION AND CHANGING PRICES.

The financial statements and accompanying footnotes have been prepared in
accordance with GAAP, which require the measurement of financial position and
operating results in terms of historical dollars without consideration for
changes in the relative purchasing power of money over time due to inflation.
The assets and liabilities of the Bank are primarily monetary in nature and
changes in market interest rates have a greater impact on the Bank's performance
than do the effects of inflation.


ITEM 3.  CONTROLS AND PROCEDURES

During the 90-day period prior to the filing date of this report, management,
including the Company's President and Chief Executive Officer and Chief
Financial Officer, evaluated the effectiveness of the design and operation of
the Company's disclosure controls and procedures. Based upon, and as of the date
of that evaluation, the President and Chief Executive Officer and Chief
Financial Officer concluded that the disclosure controls and procedures were
effective, in all material respects, to ensure that information required to be
disclosed in the reports the Company files and submits under the Exchange Act is
recorded, processed, summarized and reported as and when required.

                                       14
<PAGE>
There have been no significant changes in the Company's internal controls or in
other factors which could significantly affect internal controls subsequent to
the date the Company carried out its evaluation. There were no significant
deficiencies or material weaknesses identified in the evaluation and therefore,
no corrective actions were taken.


                                       15
<PAGE>




                               AF FINANCIAL GROUP

Part II.  OTHER INFORMATION


Item 1.  Legal Proceedings
                  The Company is not engaged in any material legal proceedings
                  at the present time other than those proceedings within the
                  normal course of business.

Item 2.  Changes in Securities and Use of Proceeds
                           Not applicable

Item 3.  Defaults Upon Senior Securities
                  Not applicable

Item 4.           Submission of Matters to a Vote of Security Holders
                  Not applicable

Item 5.          Other Information
                  Not applicable

Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibits

99.1 Section 906 of the Sarbanes-Oxley Act of 2002 CEO and CFO Certification

(b)  Reports on Form 8-K

            There were no reports on Form 8-K filed during the quarter for which
this report is filed.


<PAGE>





SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                         AF FINANCIAL GROUP


Dated February 13, 2003                  By: /s/ James A. Todd
                                             ----------------------------------
                                         James A. Todd
                                         President and Chief Executive Officer

Dated February 13, 2003                  By: /s/ Melanie Paisley Miller
                                             ----------------------------------
                                         Melanie Paisley Miller
                                         Executive Vice President, Secretary,
                                         Treasurer and Chief Financial Officer


<PAGE>
                                 CERTIFICATIONS



                  I, James A. Todd certify that:

1.   I have reviewed this quarterly report on Form 10-QSB of AF Financial Group;

2.   Based on my knowledge, this quarterly report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this quarterly report, fairly present in all
     material respects the financial condition, results of operations and cash
     flows of the registrant as of, and for, the periods presented in this
     quarterly report.

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     (a) designed such disclosure controls and procedures to ensure that
     material information relating to the registrant, including its consolidated
     subsidiaries, is made known to us by others within those entities,
     particularly during the period in which this quarterly report is being
     prepared;

     (b) evaluated the effectiveness of the registrant's disclosure controls and
     procedures as of a date within 90 days prior to the filing date of this
     quarterly report (the "Evaluation Date"); and

     (c) presented in this quarterly report our conclusions about the
     effectiveness of the disclosure controls and procedures based on our
     evaluation as of the Evaluation Date;

5.   The registrant's other certifying officers and I have disclosed, based on
     our most recent evaluation, to the registrant's auditors and the audit
     committee of the registrant's board of directors (or persons performing the
     equivalent function):

     (a) all significant deficiencies in the design or operation of internal
     controls which could adversely affect the registrant's ability to record,
     process, summarize and report financial data and have identified for the
     registrant's auditors any material weaknesses in internal controls; and

     (b) any fraud, whether or not material, that involves management or other
     employees who have a significant role in the registrant's internal
     controls; and

6.   The registrant's other certifying officers and I have indicated in this
     quarterly report whether or not there were significant changes in internal
     controls or in other factors that could significantly affect internal
     controls subsequent to the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Dated February 13, 2003           By: /s/ James A. Todd
                                      ----------------------------------
                                      James A. Todd
                                      President and Chief Executive Officer



                                       19
<PAGE>




         I, Melanie Paisley Miller, certify that:



1.   I have reviewed this quarterly report on Form 10-QSB of AF Financial Group;

2.   Based on my knowledge, this quarterly report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     this quarterly report; and

3.   Based on my knowledge, the financial statements, and other financial
     information included in this quarterly report, fairly present in all
     material respects the financial condition, results of operations and cash
     flows of the registrant as of, and for, the periods presented in this
     quarterly report.

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     (a) designed such disclosure controls and procedures to ensure that
     material information relating to the registrant, including its consolidated
     subsidiaries, is made known to us by others within those entities,
     particularly during the period in which this quarterly report is being
     prepared;

     (b) evaluated the effectiveness of the registrant's disclosure controls and
     procedures as of a date within 90 days prior to the filing date of this
     quarterly report (the "Evaluation Date"); and

     (c) presented in this quarterly report our conclusions about the
     effectiveness of the disclosure controls and procedures based on our
     evaluation as of the Evaluation Date;

5.   The registrant's other certifying officers and I have disclosed, based on
     our most recent evaluation, to the registrant's auditors and the audit
     committee of the registrant's board of directors (or persons performing the
     equivalent function):

     (a) all significant deficiencies in the design or operation of internal
     controls which could adversely affect the registrant's ability to record,
     process, summarize and report financial data and have identified for the
     registrant's auditors any material weaknesses in internal controls; and

     (b) any fraud, whether or not material, that involves management or other
     employees who have a significant role in the registrant's internal
     controls; and

6.   The registrant's other certifying officers and I have indicated in this
     quarterly report whether or not there were significant changes in internal
     controls or in other factors that could significantly affect internal
     controls subsequent to the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Dated February 13, 2003

                        By: /s/ Melanie Paisley Miller
                            ----------------------------------------------------
                        Melanie Paisley Miller
                        Executive Vice President, Secretary, Treasurer and Chief
                        Financial Officer