LAMAR CAPITAL CORPORATION

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                    FORM 10-Q


             Quarterly Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

For the quarterly period ended June 30, 1999   Commission file number: 000-25145



                            LAMAR CAPITAL CORPORATION
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)


                Mississippi                      64-0733976
     --------------------------------      -----------------------
     (State or other  jurisdiction of      (I.R.S. Employer
      incorporation of organization)        Identification Number)

        Registrant's telephone number, including area code: 601-794-6047


                                 NOT APPLICABLE
          -------------------------------------------------------------
          (name, address and fiscal year, if changed since last report)


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

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

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

           Class                   Outstanding as of August 11, 1999
           -----                   ---------------------------------
Common stock ($.50 par value)               4,315,707 shares


<PAGE>


                            LAMAR CAPITAL CORPORATION
                                    FORM 10-Q
                                      INDEX

                                                                         PAGE

PART I.  FINANCIAL INFORMATION

  ITEM 1.  Financial Statements and Supplementary Data

             Consolidated Balance Sheets -
             June 30, 1999 (Unaudited) and December 31, 1998                4

             Consolidated Statements of Income and Comprehensive
             Income (Unaudited) -
             Three Months Ended June 30, 1999 and 1998 and
             Six Months Ended June 30, 1999 and 1998                        6

             Consolidated Statements of Changes in Stockholders' Equity
             Six Months Ended June 30, 1999 (Unaudited) and year
             ended December 31,1998                                         7

             Consolidated Statements of Cash Flows (Unaudited) -
             Six Months Ended June 30, 1999 and 1998                        8

             Notes to Consolidated Financial Statements (Unaudited)         9

  ITEM 2.  Management's Discussion and Analysis of
           Financial Condition and Results of Operations                    9

  ITEM 3.  Quantitative and Qualitative Disclosures about Market Risk      14

PART II. OTHER INFORMATION

  ITEM 2.  Changes in Securities and Use of Proceeds                       16

  ITEM 4.  Submission of Matters to a Vote of Security Holders             17

  ITEM 6.  Exhibits and Reports on Form 8-K                                17

SIGNATURES                                                                 18


<PAGE>



PART I. FINANCIAL INFORMATION

      In addition to historical  information,  this report contains statements
which constitute  forward-looking  statements and information which are based on
management's  beliefs,  plans, expectations  and assumptions and on information
currently available  to  management.   The  words  "may,"  "should," "expect,"
"anticipate,"  "intend," "plan," "continue,"  "believe," "seek," "estimate," and
similar  expressions  used in this report that do not relate to historical facts
are intended to identify forward-looking statements.  These statements appear in
a number of places in this  report,  including,  but not limited to,  statements
found in Item 2  "Management's  Discussion  and  Analysis."  All phases  of the
Company's  operations  are  subject  to a  number  of risks  and  uncertainties.
Investors  are  cautioned  that  any  such  forward-looking  statements  are not
guarantees of future performance and involve risks and  uncertainties,  and that
actual results may differ materially from those projects in the forward-looking
statements.  Among  the  factors  that  could  cause  actual  results  to differ
materially are the risks and uncertainties discussed in this report,  including,
without limitation,  the portions  referenced  above, and the uncertainties set
forth from time to time in the  Company's  other public  reports and filings and
public statements,  many of which are beyond the control of the Company, and any
of which, or a combination of which,  could materially affect the results of the
Company's operations and whether forward-looking  statements made by the Company
ultimately prove to be accurate.


<PAGE>


ITEM 1. FINANCIAL STATEMENTS

                   LAMAR CAPITAL CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                      (IN THOUSANDS, EXCEPT SHARE AMOUNTS)




                                                     JUNE 30,      DECEMBER 31,
                                                       1999            1998
                                                   -----------    --------------
                                                   (UNAUDITED)
ASSETS

Cash and due from banks                            $  15,738       $  15,038
Federal funds sold                                     3,840          11,400
                                                   ----------      ----------
Cash and cash equivalents                             19,578          26,438
Securities available for sale (amortized cost -
  $100,117 in 1999 and $57,159 in 1998)               97,126          57,814
Securities held to maturity (fair value -
  $34,886 in 1999 and $33,512 in 1998)                35,301          33,014
Loans:
     Real Estate:
       Residential                                    67,558          62,333
       Construction                                   12,705           9,095
       Commercial                                     33,577          31,915
     Consumer                                         68,195          61,686
     Commercial                                       45,345          39,493
                                                   ----------      ----------
                                                     227,380         204,522
Unearned Income                                       (2,933)         (3,862)
Allowance for loan losses                             (3,681)         (3,564)
                                                   ----------      ----------
Net loans                                            220,766         197,096
Accrued interest receivable                            3,739           3,256
Premises and equipment                                 9,289           9,111
Federal Home Loan Bank stock                           3,186             788
Other assets                                           4,413           2,999
                                                   ----------      ----------
     Total assets                                  $ 393,398       $ 330,516
                                                   ==========      ==========

      LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES
Deposits:
Non-interest bearing                               $  28,334       $  27,841
Interest bearing:
  Demand                                              90,347          81,516
  Savings                                              9,972           9,437
  Time Deposits less than $100,000                   120,488         114,438
  Time Deposits more than $100,000                    45,315          45,040
                                                   ----------      ----------
     Total deposits                                  294,456         278,272
Interest payable                                         844             615
Other liabilities                                      1,407           1,178
Other borrowed funds                                  64,120          19,120
                                                   ----------      ----------
     Total liabilities                               360,827         299,185


STOCKHOLDERS' EQUITY

Common stock, $ .50 par value, 50,000,000              2,158           2,065
  shares authorized, 4,315,707 shares
  issued and outstanding at June 30, 1999
  and 4,130,707 shares issued and outstanding
  at December 31, 1998
Paid-in capital                                       17,513          15,885
Retained earnings                                     14,776          12,970
Accumulated other comprehensive income                (1,876)            411
                                                   ----------      ----------
     Total stockholders' equity                       32,571          31,331
                                                   ----------      ----------
     Total liabilities and stockholders' equity    $ 393,398       $ 330,516
                                                   ==========      ==========


See accompanying notes.

<PAGE>



                   LAMAR CAPITAL CORPORATION AND SUBSIDIARIES
     CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                   (UNAUDITED)


                                         THREE MONTHS ENDED     SIX MONTHS ENDED
                                              JUNE 30,              JUNE 30,
                                          1999        1998       1999     1998
                                          ----        ----       ----     ----
Interest income:
Loans, including fees                   $ 5,380     $ 4,575     10,496    8,868
Federal funds sold                           86         197        196      390
Interest on securities:
Taxable                                   1,544         812      2,888    1,356
Non-taxable                                 442         371        866      697
                                        --------    --------    -------  -------
                                          1,986       1,183      3,754    2,053
                                        --------    --------    -------  -------
  Total interest income                   7,452       5,955     14,446   11,311
Interest expense:
Deposits                                  3,424       3,194      6,791    5,910
Other borrowed funds                        688         306      1,262      613
                                        --------    --------    -------  -------

Total interest expense                    4,112       3,500      8,053    6,523
                                        --------    --------    -------  -------
Net interest income                       3,340       2,455      6,393    4,788
Provision for loan losses                   217         190        389      359
Net interest income after                --------    --------    -------  ------
  provision for loan losses               3,123       2,265      6,004    4,429
Other income:
Service charges on deposit
  accounts                                  549         434        956      884
Gain on sale of securities
  available for sale                          4           4          6      221
Other fees and operating income             394         371        723      647
                                        --------    --------    -------  -------
     Total other income                     947         809      1,685    1,752

Other expense:
Salaries and employee benefits            1,515       1,236      2,644    2,269
Occupancy expense                           170         148        346      311
Furniture and equipment expense             276         221        530      435
Other operating expense                     689         567      1,242    1,026
                                        --------    --------    -------  -------
     Total other expense                  2,650       2,172      4,762    4,041
                                        --------    --------    -------  -------
Income before income taxes                1,420         902      2,927    2,140
Income tax expense                          376         226        775      535
                                        --------    --------    -------  -------
Net income                                1,044         676      2,152    1,605

Other comprehensive income (loss),
  net of income taxes:
Change in unrealized gain (loss)
  on securities available for sale       (1,659)        115     (2,287)    (116)
Reclassification of realized amount          (3)         (3)        (4)    (139)
                                        --------     --------   -------  -------
Net unrealized gain (loss)
  recognized in comprehensive
  income                                 (1,662)        112     (2,291)    (255)
                                        --------     --------   -------  -------
     Comprehensive income (loss)        $  (618)     $  788     $ (139)  $1,350
                                        ========     ========   =======  =======
Earnings per share - basic and
  dilutive                              $   .24      $  .25     $  .50   $  .59
                                        ========     ========   =======  =======
Weighted average shares outstanding -
  basic and dilutive                      4,316       2,738      4,304    2,743
                                        ========     ========   =======  =======

See accompanying notes.


<PAGE>

<TABLE>
<CAPTION>

                                            LAMAR CAPITAL CORPORATION AND SUBSIDIARIES
                                    CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                                             (IN THOUSANDS, EXCEPT FOR SHARE AMOUNTS)
                                                            (UNAUDITED)

                                                                            ACCUMULATED
                                                                               OTHER                                 TOTAL
                                  COMMON STOCK       PAID-IN    RETAINED   COMPREHENSIVE      TREASURY STOCK     STOCKHOLDERS'
                              SHARES       AMOUNT    CAPITAL    EARNINGS       INCOME      SHARES       AMOUNT       EQUITY
                             ----------------------  --------   ---------  -------------  ---------------------  -------------
Balance at

<S>                             <C>           <C>     <C>        <C>              <C>           <C>      <C>         <C>
  December 31, 1997             46,569.44     $466    $ 5,374    $10,283          $279          763.44   $(242)      $16,160

Net income for 1998                                                3,049                                               3,049

Stock split
  (60-for-1)                 2,747,596.96      931       (931)                               56,842.96                   --

Dividend ($.12
  per share)                                                        (362)                                               (362)

Purchase of
  treasury stock                                                                                200.00     (72)          (72)

Sale of treasury stock                                     51                               (30,711.00)    174           225

Retirement of
 treasury stock                (27,095.40)     (14)      (126)                              (27,095.40)    140           --

Sale of common stock            1,363,636      682     11,517                                                         12,199

Change in unrealized
  gain (loss), net
  of income taxes,
  on securities
  available for sale                                                               132                                   132
                              ------------ --------  ---------  ---------   -------------  ------------ -------  -------------
Balance at
  December 31, 1998             4,130,707    2,065     15,885     12,970           411          --          --        31,331
Net income for
 six months ended
 June 30, 1999                                                     2,152                                               2,152

Dividend ($.04
per share)                                                          (346)                                               (346)

Sale of common stock              185,000       93      1,628                                                          1,721

Change in unrealized
  gain (loss), net
  of income taxes,
  on securities
  available for sale                                                            (2,287)                               (2,287)

Balance at
 June 30, 1999                ------------ --------  ---------  ---------   -------------  ------------ -------  -------------
  (Unaudited)                   4,315,707  $ 2,158    $17,513    $14,776       $(1,876)         --      $   --       $32,571
                              ============ ========  =========  =========   =============  ============ =======  =============

<FN>

See accompanying notes.
</FN>
</TABLE>

<PAGE>




                   LAMAR CAPITAL CORPORATION AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                  (UNAUDITED)


                                                              SIX MONTHS ENDED
                                                                  JUNE 30,
                                                             ------------------
                                                              1999        1998
                                                             ------      ------
Operating activities
  Net income                                                 $2,152      $1,605
  Adjustments to reconcile net income to net cash
    provided by operating activities:
      Provision for loan losses                                 389         360
      Provision for loan losses on other real estate              5          11
      Depreciation and amortization expense                     438         348
      Amortization of securities premiums                       115         121
      Accretion of securities discounts                         (25)        (12)
      Gain on sale of securities available for sale              (6)       (222)
      Gain (loss) of sales of other real estate                   1          (7)
      Increase in interest receivable                          (483)       (500)
      Increase (decrease) in interest payable                   229         (54)
      Increase in other assets                                 (308)       (241)
      Increase (decrease) in other liabilities                  180         (21)
                                                             -------     -------
Net cash provided by operating activities                     2,687       1,388
Investing activities
  Securities held to maturity:
    Proceeds from calls, maturities, and
      principal  reductions                                     580       2,935
    Purchase of securities                                   (2,140)    (13,456)
  Securities available for sale:
    Proceeds from calls, maturities,
      and principal reductions                                2,622           -
    Proceeds from sales of securities                        10,498       7,179
    Purchases of securities                                 (56,896)    (24,618)
  (Purchase) sales of Federal Home Loan Bank stock           (2,398)        209
  Net increase in loans                                     (24,072)    (19,803)
  Proceeds from sales of other real estate                      267          25
  Purchases of premises and equipment                          (616)     (2,025)
                                                            ---------   --------
Net cash used in investing activities                       (72,155)    (49,554)
Financing activities
  Net increase in deposits                                   16,184      57,098
  Net increase in revolving line of credit                        -         100
  Borrowings from banks                                      50,000           -
  Payments on notes payable to banks                         (5,000)          -
  Purchases of treasury stock                                     -         (72)
  Proceeds from sale of treasury stock                            -         150
  Proceeds from sale of common stock                          1,721           -
  Dividends paid                                               (297)       (150)
                                                            ---------   --------
Net cash provided by financing activities                    62,608      57,126
                                                            ---------   --------
  Net increase (decrease) in cash and cash equivalents       (6,860)      8,960
  Cash and cash equivalents at beginning of period           26,438      15,737
                                                            ---------   --------
  Cash and cash equivalents at end of period                $19,578     $24,697
                                                            ---------   --------


See accompanying notes.

<PAGE>

                   LAMAR CAPITAL CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


JUNE 30, 1999
(UNAUDITED)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     The  consolidated  balance sheet  at December  31,  1998  and  consolidated
statement of stockholders' equity for the year ended December 31, 1998 have been
derived from the audited  financial statements at that date.  The  accompanying
unaudited  consolidated  financial  statements include  the  accounts  of Lamar
Capital Corporation and subsidiaries.  Intercompany profits,  transactions and
balances  have been eliminated in  consolidation.  The  accompanying unaudited
consolidated   financial  statements  have been  prepared  in  accordance  with
generally accepted accounting  principles for interim financial  information and
with  the   instructions  to  Form  10-Q  and  Rule  10-01  of  Regulation  S-X.
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 (consisting  only of  normal
recurring  accruals) considered  necessary  for a fair  presentation have been
included.  Operating results for interim periods are not necessarily  indicative
of  the results  that  may  be  expected  for  the  entire year.  For  further
information, refer to the consolidated financial statements and notes thereto of
Lamar Capital Corporation's 1998 Annual Report to Shareholders.

SECURITIES PORTFOLIOS

     In accordance with FAS No. 115 "Accounting for Certain Investment in Debt
and Equity Securities", as of June 30, 1999 the securities in the "Available
for Sale" category included $2,991,000 in unrealized losses.  Accordingly, total
securities and total  stockholders' equity were decreased by $2,991,000 and
$1,876,000 (net of taxes) respectively at June 30, 1999 to reflect the
adjustment of the securities portfolio to market.


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

OVERVIEW

     For the six month period ended June 30, 1999, the Company's net income
increased to $2,152,000 as compared to $1,605,000 for the same period in 1998,
an increase of 34.1%.  Basic and  diluted earnings  per share was $0.50 in 1999
as compared to $0.59 in 1998 with an increase in weighted average shares
outstanding (basic and dilutive) to 4.3 million from 2.7 million for those
periods, respectively.  The 1998 net income included a one-time gain from the
sale of investment  securities of $139,000 (net of tax), or $0.05 per basic and
dilutive share. The increase in net income resulted primarily from increased
volume in earning assets.  The increase in net income was partially offset by a
decline in net interest margin from 3.74% for the six month period ended
June 30, 1998 to 3.65% for the six month period ended June 30, 1999.


<PAGE>

     Total assets at June 30, 1999,  increased 19.0% over year end 1998 to
$393.4 million. Increases of $41.6 million in investment securities and $23.7
million in net loans reflect this growth which was funded in part by $1.7
million in net proceeds from  the  sale  of  the underwriters' overallotment of
shares in connection  with the Company's  Initial Public Offering.

     For quarter ended June 30, 1999, the Company's net income increased to
$1,044,000 as compared to $676,000 for the same quarter in 1998, an increase of
54.4%.  Basic and diluted earnings per share was $0.24 in 1999 as compared to
$0.25 in 1998  with an increase in weighted average shares outstanding (basic
and dilutive) to 4.3 million from 2.7 million for those periods, respectively.
The increase in net income resulted primarily from increased volume in earnings
assets.  The increase in net income was also due to an increase in net interest
margin from 3.57% for the quarter ended June 30, 1998 to 3.72% for the quarter
ended June 30, 1999.


RESULTS OF OPERATIONS

NET INTEREST INCOME

     Net interest income is income produced by interest  earning assets reduced
by the interest expense associated with the funding of those assets. Changes in
the mix of these interest-earning assets and interest-bearing  liabilities and
their yields and rates  contribute to the levels of net interest income realized
and have an impact on earnings.

     During the six month period ended June 30, 1999, net interest income
increased 33.5% over the comparable  period in 1998. The increase in 1999 is
attributable to an increase in the Company's average interest-earning assets of
34.9%, primarily in the loan and  investment  securities  portfolios.  Interest-
bearing  liabilities increased 30.6% for the same periods  primarily from
increases in other borrowed funds, time deposits and transaction accounts.


<PAGE>

     The Company's  net interest margin was 3.65% for the six month period ended
June 30, 1999 compared  to 3.74% for the same  period  in 1998.  The  reduction
in net interest margin resulted from a decrease in yield on interest-earning
assets of .51% partially offset by a decline in the cost of  interest-bearing
liabilities of .30%.  The net interest margin may be  affected  by the  interest
rate environment and changes in the earning asset mix and deposit fund mix.

     During the quarter ended June 30, 1999, net interest income increased 36.0%
over the comparable period in 1998.  The increase in 1999 is attributable to an
increase in the Company's average interest-earning assets of 30.5%, primarily,
in the loan and investment securities portfolios.  Interest-bearing liabilities
increased 25.7% for the same periods primarily from increases in other borrowed
funds, time deposits and transaction accounts.

     The Company's net interest margin was 3.72% for the quarter ended June 30,
1999 compared to 3.57% for the same period in 1998. The increase in net interest
margin resulted from a decrease in yield on interest-earning assets of .35%
offset by a decline in the cost of interest-bearing liabilities of .36%.


ALLOWANCE AND PROVISION FOR LOAN LOSSES

     The  allowance for loan losses is  regularly evaluated  by  management and
approved by the Board of Directors and is  maintained at a level  believed to be
adequate to absorb future loan losses in the Company's portfolio.  The provision
for loan losses is determined in part using an internal watch list developed by
a review of essentially all loans by management.

     The Company's allowance for loan losses increased $295,000 to $3.7 million
at six month period ended June 30, 1999 compared to the same period in 1998. The
Company's allowance for loan losses to total loans  decreased  from 1.8% at
June 30, 1998 to 1.6% at June 30, 1999.


NON-INTEREST INCOME

     For the six month period ended June 30, 1999, non-interest income was
$1,685,000 compared to $1,752,000 for the same period in 1998,  a decrease of
3.8%.  This decrease was primarily due to the gain on sale of securities
available for sale of $220,000 in 1998.

     For the quarter ended June 30, 1999, non-interest income was $947,000
compared to $809,000 for the same period in 1998, an increase of 17.1%.  This
increase was primarily due to the increases in service charges on deposit
accounts.

<PAGE>

NON-INTEREST EXPENSE

     For the six month period ended June 30, 1999, non-interest  expense was
$4.8 million compared  to $4.0 million  for the  same  period  in  1998, a 17.8%
increase.  Non-interest  expense levels are often measured using an efficiency
ratio.  The efficiency  ratio measures the level of expense required to generate
one dollar of revenue.  At June 30,  1999,  the  Company's efficiency  ratio was
58.95% as compared to 61.78% at June 30, 1998.

     For the quarter ended June 30, 1999, non-interest expense was $2.7 million
compared to $2.2 million for the same quarter in 1998, a 22.0% increase.  For
the quarter ended June 30, 1999, the Company's efficiency ratio was 61.83% as
compared to 65.24% for the same quarter in 1998.

     Salaries and benefits is the largest component of  non-interest expense
and increased 22.6% and 16.5%, respectively when compared to the quarter and six
months ended June 30, 1998. Additional staffing has been required in
several locations  as a result of volume  and  increased  demand.


FINANCIAL CONDITION

LIQUIDITY

     The Company  maintains  sufficient liquidity to fund loan  demand,  deposit
withdrawals and debt repayments.  Liquidity is managed by retaining sufficient
liquid assets in the form of cash and cash equivalents and core deposits to meet
such demand.  The Company also realizes funding and cash flows from the
investment securities  portfolio  and pay  downs  from the loan  portfolio. In
addition, the Company has funds available to address liquidity needs under a
line of credit, federal funds lines, the retail deposit market, and  additional
FHLB borrowings.

     The Company's objectives include preserving an adequate liquidity position.
Asset/liability management is designed to ensure safety and soundness,  maintain
liquidity  and  regulatory capital  standards,  and achieve an  acceptable  net
interest  margin.  The Company  continues to experience  strong loan demand and
management continues  to  monitor  interest  rate  and liquidity  risks  while
implementing appropriate funding and balance sheet strategies.

CAPITAL

     The Company maintains risk-based capital levels well in excess of the
minimum guidelines adopted by the Federal Reserve Board for bank holding
companies.  The Company's tier 1 capital and total  risk-based capital ratios at
June 30, 1999 were 14.44% and 15.69%, respectively. This compares to a tier 1
capital ratio of 14.65% and total risk-based  capital ratio of 15.90% at
December 31, 1998.  The Company's  leverage  ratio  was 8.79% at June 30,  1999
compared  to 9.55% at December 31, 1998.


<PAGE>

YEAR 2000

     The Company  continues to implement plans to address the Year 2000 issue.
The issue arises from the fact that many existing computer programs were written
to store only two digits of date-related  information in order to more
efficiently handle and store data.  Thus,  the programs were unable to properly
distinguish between the year 1900 and the year 2000.  The Company has  converted
or replaced various programs, hardware and  instrumentation systems to make them
Year 2000 compliant.  The Company's  Year 2000 project is  comprised  of two
components - business applications and equipment.

     In  addressing  the  Year  2000  problem, the Company  has examined its own
software  and equipment,  potential  problems  with  borrowers, and  potential
problems with government  entities and others providing services to the Company.
In addition to computer equipment, the Company has addressed possible problems
with  microprocessors embedded within operating equipment, such as
telecommunication equipment, vaults,  security and alarm systems,  and automated
teller machines.  The Company continues to monitor the impact of the failure of
a borrower's systems or a borrower's failure to comply with debt  covenant terms
regarding  Year  2000  issues on the credit  quality of the  borrower's  loan by
communicating  with  its significant  existing  and  new  loan  customers and
ascertaining  whether  the  customers  need  to include  remediation  and/or
replacement of systems as part of their Year 2000  program and when they will
have that completed.  Presently, the Company has no reason to believe  that its
borrowers  will not be able to adequately address the Year 2000 issue.

     The Company's President is Chairman of its Year 2000 committee. The
Committee has devoted appropriate personnel resources to achieve Year 2000
compliance in a timely manner.  Such personnel has worked with the Company's
Board of Directors and  other  members of management in completing  its  action,
testing  and contingency plans.  The Company is also subject to oversight by the
FDIC,  the Federal  Reserve  Board and the Mississippi Department of Banking and
Consumer Finance with respect to Year 2000 compliance.

     The  Company  has  completed  the  Year  2000 awareness,  assessment,   and
remediation phases.  Minor  implementations  have been completed as of June 30,
1999.  Service provider testing of critical  information  systems were completed
for the majority testing required by June 30, 1999.  Testing of all critical
systems and a contingency/business  resumption  plan was completed by the
June 30,  1999 regulatory  deadline.  The Company has expended  approximately
$120,000 through June 30, 1999 and projects  no additional  cost  of remediation
for the remainder of the year. To date, independent analysis of the Company's
Year 2000 exposure has not been obtained.  Approximately  $50,000  has been
capitalized  because  certain systems and equipment are being replaced and these
costs are associated with purchasing new systems.  Corrective actions to make
the Company's core operating systems Year 2000  compliant  have been made by the
Company's  software  providers  under existing  licensing agreements  with the
Company at no additional expense.


<PAGE>

     The Year  2000  issue  principally  involves the installation of  selected
software releases which are Year 2000 compliant.  Certain of these installations
would have been  scheduled for completion by the Year 2000 in the normal course
of business.  The Year 2000 compliance of the Company's software suppliers will
be  essential  for the Company's  successful  implementation  of its Year  2000
objectives.

     The Company has  examined the Year 2000 issues' impact on services  such as
payroll and investment securities operations that are provided by third parties.
The  capabilities and  readiness  for Year 2000 of other vendors have also been
reviewed.  Presently,  the testing phase provides the Company with no reason to
believe that its software  providers,  service providers and vendors will not be
able to  adequately  address the Year 2000  issue.  To the extent the  software
providers',  service providers' and vendor's responses are not satisfactory, the
Company  will proceed  with  the  steps  outlined  in its contingency/business
resumption plan.

     The contingency/business  resumption plan includes critical Company areas
such as operations, personnel,  network and business systems as well as systems
external to the Company.  The plan addresses  various  alternatives and includes
assessing a variety of scenarios that could emerge in the year 2000 and require
the  Company  to react.  As an  integral  part of the  plan potential liquidity
challenges are being addressed.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Asset/liability management control is designed to ensure safety and
soundness, maintain liquidity and regulatory capital standards, and achieve
acceptable net interest income.  Management considers interest rate risk to be
the Company's most significant  market risk.  Interest rate risk is the exposure
to adverse changes in the net interest income as a result of market fluctuations
in interest rates.

     Management  regularly  monitors interest rate risk in relation to
prospective market and business conditions.  The Company's  Board of Directors
sets policy guidelines  establishing  maximum  limits on the  Company's interest
rate risk exposure.  Management monitors and adjusts exposure to interest rate
fluctuations as influenced by the Company's loan, investment and deposit
portfolios.

     The Company uses an earnings  simulation model to analyze net interest
income sensitivity.  Potential  changes in market  interest rates and their
subsequent effect on interest income are then  evaluated. The model projects the
effect of instantaneous movements in interest rates of 200 basis points.
Assumptions based on the historical  behavior  of the  Company's  deposit rates
and  balances in relation  to changes in interest  rates are also  incorporated
into the model.   These assumptions are inherently uncertain,  and as a result,
the model cannot precisely  measure  net  interest  income or precisely  predict
the  impact of fluctuations  in market  interest rates on net interest  income.
Actual results will differ  from the model's simulated  results due to timing,
magnitude  and frequency of interest rate changes,  as well as changes in market
conditions and the application of various management strategies.


<PAGE>

     Interest rate risk management focuses on maintaining acceptable net
interest income within policy  limits  approved by the Board of Directors.  The
Company's Board of  Directors  monitors  and  manages  interest  rate risk to
maintain an acceptable level of change to net interest income resulting from
market interest rate changes.  The Company's interest rate risk policy, as
approved by the Board of  Directors,  is stated in terms of change in net
interest  income given a 200 basis point  immediate  and  sustained  increase or
decrease in market  interest rates.  The current limits approved by the Board of
Directors are plus or minus 10% of net interest income for a 200 basis point
movement.

<PAGE>


PART II - OTHER INFORMATION

ITEM 2.   CHANGES IN SECURITIES AND USE OF PROCEEDS

     In December  1998,  the Company  completed its initial  public  offering
(the "Offering") of 1,548,636 shares of Common Stock (including 185,000 shares
issued January 11, 1999 in connection with the exercise  of  the underwriters'
over-allotment option) at a price per share of $10.00.

          (1)   Effective date of Registration Statement: December 16, 1998
                (File No. 333-61355)
          (2)   The Offering commenced on December 16, 1998 and was consummated
                on December 22, 1998.
          (3)   All securities registered in the Offering were sold.
          (4)   The managing underwriters of the Offering were Morgan Keegan &
                Company, Inc. and Sterne, Agee & Leach, Inc.
          (5)   Common Stock, $.50 par value.
          (6)   Amount registered and sold: 1,548,636.
          (7)   Aggregate purchase price: $15,486,360.
          (8)   All shares were sold for the account of the Issuer.
          (9)   $1,084,045 in underwriting discounts and commissions were paid
                to the underwriters.  $483,081 of other expenses were incurred,
                including estimated expenses.
         (10)   $13,919,234 of net Offering proceeds to the Issuer.
         (11)   Use of Proceeds: $3,660,288 to retire indebtedness of the
                Company to Bank One, New Orleans, Louisiana; $7,500,000 was
                injected into the capital of the Bank in order to improve the
                capital ratios of the Bank so that the  Bank will be positioned
                to make necessary capital expenditures to establish two de novo
                branches in Hattiesburg, Mississippi one of which the Company
                expects to be operational in the first quarter of 2000; and the
                remainder of the Offering proceeds are being held by the Company
                for the possible future acquisition of other financial
                institutions or branches and the contribution of additional
                capital to the Bank to support loan growth.

<PAGE>


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

     A.     Annual Meeting held May 11, 1999

     B.     Directors elected at the Annual Meeting held May 11, 1999:


                                                   Votes Cast
                                                   ----------
                                            Affirmed        Withheld
                                            --------        --------
            1. Robert W. Roseberry          3,568,313       1,500
            2. Jane P. Roberts              3,568,313       1,500
            3. Kenneth M. Lott              3,568,313       1,500
            4. O. B. Black, Jr.             3,568,113       1,700
            5. William H. Jordan            3,568,113       1,700
            6. James R. Pylant              3,568,113       1,700
            7. Monty C. Roseberry           3,568,313       1,500

     C. Approval of Ernst & Young, LLP as the independent public accountants of
        the Company.  Approval was made with a favorable vote of 82.62%.

        For                    Against               Abstained
        ---                    -------               ---------
        3,565,705               2,108                 2,000



ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

    Exhibit (27) Selected financial data.

<PAGE>


SIGNATURES

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



                                        BY: /s/ Robert W. Roseberry
                                           -------------------------
                                           ROBERT W. ROSEBERRY
                                           CHAIRMAN AND CHIEF EXECUTIVE OFFICER
                                           (PRINCIPAL EXECUTIVE OFFICER)


DATE: AUGUST 16, 1999

                                         BY: /s/ Donna T. Rutland
                                            ------------------------
                                            DONNA T. RUTLAND
                                            CHIEF FINANCIAL OFFICER
                                            (PRINCIPAL FINANCIAL OFFICER AND
                                            PRINCIPAL ACCOUNTING OFFICER)


DATE: AUGUST 16, 1999