<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q


[ X ]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d OF THE SECURITIES
       EXCHANGE ACT OF 1934

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2002


[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

                     FOR THE TRANSITION PERIOD FROM - TO --

                         Commission file number 0-30665

                          CNB Financial Services, Inc.
-------------------------------------------------------------------------------
             (Exact Name of Registrant as specified in its charter)

<TABLE>
<S>                                                        <C>
             United States of America                                   55-0773918
------------------------------------------------------     ---------------------------------------
         (State or other jurisdiction of                      (I.R.S. Employer Identification No.)
          incorporation or organization)

  101 S. Washington Street, Berkeley Springs, WV                           25411
------------------------------------------------------     ---------------------------------------
    (Address of principal executive offices)                             (Zip Code)
</TABLE>


Issuer's telephone number, ( 304 )  258  - 1520
                            -----  -----   ----

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 issuer's classes of
                common stock, as of the latest practicable date.

  Common Stock $1 par value, 458,048 shares outstanding as of November 1, 2002

<PAGE>


                          CNB FINANCIAL SERVICES, INC.

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>

                                                                                                          PAGE
<S>                                                                                                       <C>
PART 1:   FINANCIAL INFORMATION PAGE

     Item 1    Financial Statements

               Consolidated Statements of Financial Condition as of September 30, 2002 (Unaudited)
                 and December 31, 2001................................................................     3

               Consolidated Statements of Income for the Three and Nine Months ended September 30,
                 2002 and  2001 (Unaudited)...........................................................     4

               Consolidated Statements of Changes in Shareholders' Equity for the Nine
                 Months Ended September 30, 2002 (Unaudited) and the Year Ended December 31, 2001.....     5

               Consolidated Statements of Cash Flows for the Nine Months
                 Ended September 30, 2002 and 2001 (Unaudited)........................................     6

               Notes to Consolidated Financial Statements (Unaudited).................................     7

     Item 2.   Management's Discussion and Analysis of Financial Condition and
                 Results of Operations for the Three and Nine Months ended September 30, 2002.........    12

     Item 3.   Quantitative and Qualitative Disclosures about Market Risk.............................    19

     Item 4.   Controls and Procedures................................................................    20



PART II:  OTHER INFORMATION

     Item 1.   Legal Proceedings......................................................................    21

     Item 6.   Exhibits and Reports on Form 8-K.......................................................    21

               SIGNATURES.............................................................................    22

               CERTIFICATIONS.........................................................................    23
</TABLE>


                           Forward-Looking Statements

         The Private Securities Litigation Reform Act of 1995 indicates that the
disclosure of forward-looking information is desirable for investors and
encourages such disclosure by providing a safe harbor for forward-looking
statements that involve risk and uncertainty. All statements other than
statements of historical fact included in this Form 10-Q including statements in
Management's Discussion and Analysis of Financial Condition and Results of
Operations are, or may be deemed to be, forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. In order to comply with the terms of the safe
harbor, CNB notes that a variety of factors could cause CNB's actual results and
experience to differ materially from the anticipated results or other
expectations expressed in those forward-looking statements. These factors could
include the following possibilities: (1) competitive pressures among depository
and other financial institutions may increase significantly; (2) changes in the
interest rate environment may reduce margins; (3) general economic conditions
may become unfavorable resulting in reduced credit quality or demand for loans;
(4) legislative or regulatory changes; and (5) competitors may have greater
financial resources and develop products that enable them to compete more
successfully than CNB.



                                       2
<PAGE>

               CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY
             CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>

                                                                             SEPTEMBER 30,                 DECEMBER 31,
                                 ASSETS                                         2002                          2001
                                                                            --------------              ---------------
                                                                            (Unaudited)
<S>                                                                            <C>                          <C>
Cash and due from banks                                                      $ $ 8,816,379                $   4,229,810
Federal funds sold                                                               4,973,533                            -
Securities available for sale
   (at approximate market value)                                                48,420,299                   48,913,329
Federal Home Loan Bank stock, at cost                                              646,900                      625,500
Federal Reserve Bank stock, at cost                                                129,650                      129,650
Loans and lease receivable, net                                                119,941,586                  110,536,744
Accrued interest receivable                                                        989,192                    1,052,620
Foreclosed real estate (held for sale), net                                          6,500                       14,898
Premises and equipment, net                                                      4,908,355                    4,283,625
Deferred income taxes                                                                    -                      225,894
Cash surrender value of life insurance                                             963,452                      883,533
Intangible assets                                                                   98,654                      105,168
Other assets                                                                       391,287                      540,672
                                                                          -----------------            -----------------

         TOTAL ASSETS                                                        $ 190,285,787                $ 171,541,443
                                                                          =================            =================


                  LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
   Deposits:
        Demand                                                               $  23,982,947                $  19,174,111
        Interest-bearing demand                                                 31,566,758                   24,878,709
        Savings                                                                 20,756,445                   17,851,684
        Time, $100,000 and over                                                 34,733,568                   27,450,519
        Other time                                                              60,736,627                   65,025,516
                                                                          -----------------            -----------------
                                                                             $ 171,776,345                $ 154,380,539
   Accrued interest payable                                                        970,996                    1,148,437
   Accrued expenses and other liabilities                                        1,162,649                    1,086,230
   Deferred income taxes                                                           128,367                            -
                                                                          -----------------            -----------------

         TOTAL LIABILITIES                                                   $ 174,038,357                $ 156,615,206
                                                                          -----------------            -----------------

SHAREHOLDERS' EQUITY
   Common stock, $1 par value; 5,000,000  shares
       authorized; 458,048 shares outstanding                                    $ 458,048                    $ 458,048
   Capital surplus                                                               3,863,592                    3,863,592
   Retained earnings                                                            11,198,829                   10,426,618
   Accumulated other comprehensive income                                          726,961                      177,979
                                                                          -----------------            -----------------

         TOTAL SHAREHOLDERS' EQUITY                                          $  16,247,430                $  14,926,237
                                                                          -----------------            -----------------

         TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                          $ 190,285,787                $ 171,541,443
                                                                          =================            =================
</TABLE>

The Notes to Consolidated Financial Statements are an integral part of these
statements.



                                       3
<PAGE>

             CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY
            CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED                 NINE MONTHS ENDED
                                                                     SEPTEMBER 30,                      SEPTEMBER 30,
                                                          -------------------------------    -------------------------------
                                                              2002             2001              2002             2001
                                                          -------------    --------------    --------------   --------------
<S>                                                         <C>               <C>               <C>              <C>
INTEREST INCOME
   Interest and fees on loans                               $2,253,727        $2,399,242        $6,731,977       $7,068,503
   Interest and dividends on securities
      United States Treasury securities                              -                 -                 -              274
      U.S. Government agencies and
         corporations                                          401,999           571,703         1,475,771        1,677,766
      Mortgage backed securities                               158,269                 -           250,259                -
      State and political subdivisions                          13,113             7,363            29,946           22,088
      Other                                                      3,728             9,695            19,124           42,654
   Interest on federal funds sold                               30,124            41,190            66,178          130,560
                                                          -------------    --------------    --------------   --------------
                                                            $2,860,960        $3,029,193        $8,573,255       $8,941,845
                                                          -------------    --------------    --------------   --------------
INTEREST EXPENSE
   Interest on interest bearing demand,                     $1,334,613        $1,489,436        $4,060,939       $4,478,741
     savings and time deposits
   Interest on federal funds purchased                               -                 -                 -            2,291
                                                          -------------    --------------    --------------   --------------
                                                            $1,334,613        $1,489,436        $4,060,939       $4,481,032
                                                          -------------    --------------    --------------   --------------

           NET INTEREST INCOME                              $1,526,347        $1,539,757        $4,512,316       $4,460,813

PROVISION FOR LOAN LOSSES                                       40,500            57,000           152,000          169,000
                                                          -------------    --------------    --------------   --------------

           NET INTEREST INCOME AFTER
               PROVISION FOR LOAN LOSSES                    $1,485,847        $1,482,757        $4,360,316       $4,291,813
                                                          -------------    --------------    --------------   --------------

NONINTEREST INCOME
   Service charges on deposit accounts                      $  199,188         $ 159,370        $  538,363       $  377,998
   Other service charges, commissions
      and fees                                                  82,333            66,547           255,195          190,938
   Insurance commissions                                        27,331            34,940            78,715           93,720
   Other operating income                                       19,435            25,664           100,851           64,505
   Net gain on sale of securities                                    -                 -            78,028              833
   Gain on sale of other real estate owned                           -                 -             3,492                -
                                                          -------------    --------------    --------------   --------------
                                                            $  328,287        $  286,521        $1,054,644       $  727,994
                                                          -------------    --------------    --------------   --------------
NONINTEREST EXPENSES
   Salaries                                                  $ 588,030         $ 519,594        $1,683,422       $1,482,112
   Employee benefits                                           183,844           149,898           554,321          455,079
   Occupancy of premises                                        62,758            72,623           205,714          201,383
   Furniture and equipment expense                              90,260            55,653           271,088          171,726
   Other operating expenses                                    432,084           424,885         1,257,836        1,194,354
                                                          -------------    --------------    --------------   --------------
                                                            $1,356,976        $1,222,653        $3,972,381       $3,504,654
                                                          -------------    --------------    --------------   --------------

            INCOME BEFORE INCOME TAXES                      $  457,158        $  546,625        $1,442,579       $1,515,153

PROVISION FOR INCOME TAXES                                     160,319           187,237           505,470          534,699
                                                          -------------    --------------    --------------   --------------

            NET INCOME                                      $  296,839        $  359,388        $  937,109       $  980,454
                                                          =============    ==============    ==============   ==============

BASIC EARNINGS PER SHARE                                    $     0.65        $     0.78        $     2.05       $     2.14
                                                          =============    ==============    ==============   ==============
</TABLE>

The Notes to Consolidated Financial Statements are an integral part of these
statements.


                                       4
<PAGE>

                   CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY
     CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited)
<TABLE>
<CAPTION>
                                                                                              ACCUMULATED
                                                                                                 OTHER              TOTAL
                                         COMMON            CAPITAL            RETAINED         COMPREHENSIVE    SHAREHOLDERS'
                                         STOCK             SURPLUS            EARNINGS           INCOME             EQUITY
                                     ---------------    ---------------    ---------------   ---------------    ---------------
<S>                                       <C>              <C>                <C>                <C>               <C>
BALANCE, DECEMBER 31, 2000                $ 458,048        $ 3,863,592        $ 9,657,422        $ (115,244)       $13,863,818
                                                                                                                ---------------
Comprehensive income:
   Net income for 2001                            -                  -          1,236,405                 -          1,236,405
  Change in unrealized gains
    (losses) on securities
    available for sale (net of
    tax of $179,718)                              -                  -                  -           293,223            293,223
                                                                                                                ---------------
Total Comprehensive Income                        -                  -                  -                 -          1,529,628
                                                                                                                ---------------
Cash dividends ($1.02 per share)                                                 (467,209)                            (467,209)
                                     ---------------    ---------------    ---------------   ---------------    ---------------

BALANCE,  DECEMBER 31, 2001               $ 458,048        $ 3,863,592        $10,426,618         $ 177,979        $14,926,237
                                                                                                                ---------------
Comprehensive income:
   Net income for nine months
      ended September 30, 2002                    -                  -            937,109                 -            937,109
  Change in unrealized gains
    (losses) on securities
    available for sale (net of
    tax of $354,261)                              -                  -                  -           548,982            548,982
                                                                                                                ---------------
                                                                                                                ---------------
Total Comprehensive Income                        -                  -                  -                 -          1,486,091
                                                                                                                ---------------
                                                                                                                ---------------
Cash dividends ($0.36 per share)                                                 (164,898)                            (164,898)
                                     ---------------    ---------------    ---------------   ---------------    ---------------

BALANCE,  SEPTEMBER 30, 2002              $ 458,048        $ 3,863,592        $11,198,829         $ 726,961        $16,247,430
                                     ===============    ===============    ===============   ===============    ===============
</TABLE>

The Notes to Consolidated Financial Statements are an integral part of these
statements.



                                       5
<PAGE>



                 CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (Unaudited)
<TABLE>
<CAPTION>
                                                                                            NINE MONTHS ENDED
                                                                                               SEPTEMBER 30,
                                                                                   ------------------------------------
                                                                                       2002                  2001
                                                                                   ----------------    ----------------
<S>                                                                                      <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                                            $    937,109        $    980,454
Adjustments to reconcile net income to net cash
   provided by operating activities:
     Depreciation and amortization                                                         261,743             171,735
     Provision for loan losses                                                             152,000             169,000
     Deferred income taxes                                                                       -             (60,000)
     Net (gain) on sale of securities                                                      (78,028)               (833)
     (Gain) on sale of real estate owned                                                    (3,492)                  -
     (Increase) decrease in accrued interest receivable                                     63,428            (156,580)
     (Increase) decrease in other assets                                                   274,046             (67,429)
     Increase (decrease) in accrued interest payable                                      (177,441)             12,140
     (Increase) in cash surrender value on life insurance in excess
          of premiums paid                                                                  (3,408)            (34,553)
     Increase (decrease) in accrued expenses and other liabilities                          76,419             (10,030)
     Amortization of deferred loan (fees) cost                                              56,319              39,426
     Amortization (accretion) of premium and discount on investments                        15,244             (25,690)
                                                                                   ----------------    ----------------
         NET CASH PROVIDED BY OPERATING ACTIVITIES                                    $  1,573,939        $  1,017,640
                                                                                   ----------------    ----------------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Net (increase) in loans                                                          $ (9,649,661)       $ (5,196,547)
     Proceeds from sales of securities                                                   7,075,471             901,406
     Proceeds from maturities of securities                                             28,653,020          36,472,222
     Purchases of securities                                                           (34,290,835)        (41,535,163)
     Purchases of premises and equipment                                                (1,032,053)         (1,014,023)
     Proceeds from sales of other real estate owned, net                                    48,390                   -
     Net (increase) in federal funds sold                                               (4,973,533)         (4,446,210)
     Premiums paid on life insurance                                                       (49,078)            (49,843)
                                                                                   ----------------    ----------------
         NET CASH (USED IN) INVESTING ACTIVITIES                                     $ (14,218,279)      $ (14,868,158)
                                                                                   ----------------    ----------------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Net increase in demand and savings deposits                                      $  14,401,646       $   4,318,693
    Net increase in time deposits                                                        2,994,160          10,207,078
    Cash dividends paid                                                                   (164,897)           (164,897)
                                                                                   ----------------    ----------------
         NET CASH PROVIDED BY FINANCING ACTIVITIES                                   $  17,230,909       $  14,360,874
                                                                                   ----------------    ----------------

         NET INCREASE IN CASH AND CASH EQUIVALENTS                                   $   4,586,569       $     510,356
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                                           4,229,810           3,739,854
                                                                                   ----------------    ----------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                                           $   8,816,379       $   4,250,210
                                                                                   ================    ================

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
     Cash paid during the period:
               Interest                                                                $   4,238,380        $   4,491,253
               Income taxes                                                            $     502,000        $     539,500
     Net transfer to foreclosed real estate, held for sale from loans
            receivable                                                                 $      36,500        $           -
</TABLE>

The Notes to Consolidated Financial Statements are an integral part of these
statements.


                                       6
<PAGE>

                          CNB FINANCIAL SERVICES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


Note 1. Formation of Holding Company

                  In March 2000, Citizens National Bank's Board of Directors
         approved the formation of CNB Financial Services, Inc., (CNB) a
         financial services holding company. On August 4, 2000, the shareholders
         of Citizens National Bank approved an agreement and plan of merger
         whereby the Bank became a wholly-owned subsidiary of CNB Financial
         Services, Inc., a newly-formed financial services holding company. On
         the effective date of this reorganization, each bank shareholder
         received two shares of CNB stock for each share of the Bank's common
         stock. The Bank expensed all costs of start-up activities of CNB, and
         the merger was accounted for as a pooling of interest.

Note 2. Basis of Presentation

                  In the opinion of CNB, the accompanying unaudited consolidated
         financial statements contain all adjustments (consisting of only normal
         recurring accruals) necessary for a fair presentation of CNB financial
         condition as of September 30, 2002 and the results of operations for
         the three and nine months ended September 30, 2002 and 2001 and cash
         flows for the nine months ended September 30, 2002 and 2001.

                  The accompanying unaudited financial statements have been
         prepared in accordance with the instructions for Form 10-Q. These
         financial statements should be read in conjunction with the
         consolidated financial statements and the notes included in the CNB's
         Annual Report for the year ended December 31, 2001.




                                       7
<PAGE>


                          CNB FINANCIAL SERVICES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


Note 3. Securities Available for Sale

                  The amortized cost and estimated market value of debt
         securities at September 30, 2002 and December 31, 2001 by contractual
         maturity are shown below. Expected maturities will differ from
         contractual maturities because borrowers may have the right to call or
         prepay obligations with or without call or prepayment penalties.

         Securities available for sale are summarized as follows:

<TABLE>
<CAPTION>
                                                                SEPTEMBER 30, 2002                               WEIGHTED
                                       --------------------------------------------------------------------      AVERAGE
                                                            GROSS             GROSS           ESTIMATED            TAX
                                         AMORTIZED        UNREALIZED        UNREALIZED           FAIR           EQUIVALENT
                                            COST            GAINS             LOSSES            VALUE             YIELD
                                       ---------------  ---------------   ---------------   ---------------     ------------
<S>                                       <C>                 <C>                    <C>       <C>              <C>
Available for sale:
    U.S. Government agencies
      and corporations
      Within one year                     $ 5,744,338         $ 13,472               $ -       $ 5,757,810              4.65 %
      After 1 but within 5 years           14,484,080          479,508                 -        14,963,588              4.60
      After 5 but within 10 years          12,324,569          435,436             7,975        12,752,030              5.66
                                       ---------------  ---------------   ---------------   ---------------
                                          $32,552,987        $ 928,416           $ 7,975       $33,473,428              4.79
                                       ---------------  ---------------   ---------------   ---------------

    States and political subdivisions
      Within one year                       $ 100,000             $ 85               $ -           100,085              6.97
      After 1 but within 5 years              250,000                -                 -           250,000              6.00
      After 5 but within 10 years             775,000           39,366                 -           814,366              6.42
                                       ---------------  ---------------   ---------------   ---------------
                                          $ 1,125,000         $ 39,451               $ -       $ 1,164,451              6.37
                                       ---------------  ---------------   ---------------   ---------------

    Mortgage backed securities            $13,552,006        $ 241,947          $ 11,533       $13,782,420              5.29
                                       ---------------  ---------------   ---------------   ---------------

Total securities available for sale       $47,229,993      $ 1,209,814          $ 19,508       $48,420,299              4.97 %
                                       ===============  ===============   ===============   ===============
</TABLE>




                                       8
<PAGE>

                          CNB FINANCIAL SERVICES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

         Note 3.   Securities Available for Sale (continued)
<TABLE>
<CAPTION>
                                              DECEMBER 31, 2001                                                  WEIGHTED
                                       --------------------------------------------------------------------      AVERAGE
                                                            GROSS             GROSS           ESTIMATED            TAX
                                         AMORTIZED        UNREALIZED        UNREALIZED           FAIR           EQUIVALENT
                                            COST            GAINS             LOSSES            VALUE             YIELD
                                       ---------------  ---------------   ---------------   ----------------    ----------
<S>                                       <C>                  <C>                   <C>       <C>              <C>
Available for sale:
    U.S. Government agencies
      and corporations
      Within one year                     $ 1,250,000          $ 1,328               $ -       $ 1,251,328         6.63 %
      After 1 but within 5 years           29,007,880          116,337           151,186        28,973,031         4.67
      After 5 but within 10 years          17,818,385          327,707             3,568        18,142,524         6.28
                                       ---------------  ---------------   ---------------   ---------------
                                          $48,076,265        $ 445,372         $ 154,754       $48,366,883         5.27
                                       ---------------  ---------------   ---------------   ---------------

    States and political subdivisions
      After 1 but within 5 years            $ 350,000          $ 1,020               $ -         $ 351,020         6.75
      After 5 but within 10 years             200,000                -             4,574           195,426         8.02
                                       ---------------  ---------------   ---------------   ---------------
                                            $ 550,000          $ 1,020           $ 4,574         $ 546,446         7.21
                                       ---------------  ---------------   ---------------   ---------------

Total securities available for sale       $48,626,265        $ 446,392         $ 159,328       $48,913,329         5.30 %
                                       ===============  ===============   ===============   ===============
</TABLE>


                  The carrying value of securities pledged to secure public
         deposits and for other purposes as required or permitted by law totaled
         $12,082,406 at September 30, 2002 and $12,099,922 at December 31, 2001.

                  Proceeds from sales of securities available for sale
         (excluding maturities) during the nine months ended September 30, 2002
         and the year ended December 31, 2001 were $7,075,471 and $901,406,
         respectively. Gross gains (losses) of $78,028 and $(-0-) during the
         nine months ended September 30, 2002 and $7,071 and $(6,238) for the
         year ended December 31, 2001 were realized on the respective sales.



                                       9
<PAGE>

                          CNB FINANCIAL SERVICES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


Note 4. Loans and Lease Receivable

                  Major classifications of loans at September 30, 2002 and
         December 31, 2001, were as follows:


                                        SEPTEMBER 30,          DECEMBER 31,
                                             2002                  2001
                                       -----------------     -----------------
Loans:
  Real estate                           $   75,749,842     $      67,859,963
  Commercial real estate                    14,280,096            12,458,880
  Consumer                                  22,839,244            24,197,964
  Commercial                                 7,952,635             6,977,624
  Overdrafts                                   240,213                86,694
                                       -----------------     -----------------
                                        $  121,062,030      $    111,581,125

Lease:                                         136,351               139,608
                                       -----------------     -----------------
                                        $  121,198,381      $    111,720,733
Net deferred loan fees, costs,
    premiums and discounts                     165,458               152,971
Allowance for loan losses                   (1,422,253)           (1,336,960)
                                       -----------------     -----------------
                                        $  119,941,586      $    110,536,744
                                       =================     =================

                  An analysis of the allowance for possible loan losses is as
         follows:
<TABLE>
<CAPTION>

                                        SEPTEMBER 30,                   DECEMBER 31,
                                 ---------------------------------      ------------
                                       2002               2001              2001
                                 --------------     --------------      ------------
<S>                              <C>                <C>               <C>
Balance, Beginning                 $ 1,336,960        $ 1,216,333       $ 1,216,333
    Provision charged to
        operations                     152,000            169,000           226,000
    Recoveries                          31,346             24,090            29,729
    Loans charged off                  (98,053)           (91,885)         (135,102)
                                 --------------     --------------    --------------
Balance, Ending                    $ 1,422,253        $ 1,317,538       $ 1,336,960
                                 ==============     ==============    ==============
</TABLE>

                  Loans are placed in nonaccrual status when, in the judgement
         of management, the probability of collection of interest is deemed to
         be insufficient to warrant further accrual. A summary of nonaccrual
         loans is as follows:
<TABLE>
<CAPTION>
                                        SEPTEMBER 30,                   DECEMBER 31,
                                 ---------------------------------      ------------
                                    2002                  2001              2001
                                 --------------     --------------      ------------
<S>                                <C>                <C>               <C>
Loans:
  Consumer                         $     9,338        $     7,315       $    25,173
                                  =============     ==============    ==============
</TABLE>

                                       10
<PAGE>


                          CNB FINANCIAL SERVICES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

Note 4. Loans and Lease Receivable (continued)

                  Proceeds from sale of loans during the nine months ended
         September 30, 2002 and the year ended December 31, 2001 were $0. There
         were no gains or losses on sale of loans.

Note 5.  Time Deposits

                  At September 30, 2002, the scheduled maturities of time
         deposits are as follows:

                                    TIME DEPOSITS             ALL TIME
                                  $100,000 AND OVER           DEPOSITS
                                 ------------------       ---------------

Within 3 months                        $ 3,011,633          $ 13,380,812
3 months thru 6 months                   8,029,906            17,352,227
6 months thru 12 months                 10,156,376            21,231,280
Over 12 months                          13,535,653            43,505,876
                                 ------------------       ---------------
                                      $ 34,733,568          $ 95,470,195
                                 ==================      ================

Note 6.   Shareholders' Equity

                  On August 31, 2000, CNB became a one-bank holding company by
         merger with the Bank, and the shareholders received two shares of CNB
         stock with a $1 par value for each share of Bank stock with a $10 par
         value. Common stock, capital surplus and retained earnings have been
         restated to reflect the change in par value and the shares issued due
         to the formation of CNB.

                  Basic earnings and dividends per share have been computed
         based on 458,048 weighted average number of shares outstanding in 2002
         and 2001.

Note 7.  New Branch

                  On April 20, 2001, the Bank purchased a parcel of land in
         Berkeley County, West Virginia for $450,000 to construct a new branch
         facility. The Bank leased a parcel of land adjacent to the purchased
         land and rented a temporary facility in which to conduct business while
         the permanent bank building was under construction. The temporary
         facility opened for business in August 2001. Construction on the
         permanent facility began in September 2001 and was completed in March
         2002. On March 18, 2002, the temporary facility was closed and the new
         branch building was occupied.



                                       11
<PAGE>

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

GENERAL

                  CNB Financial Services, Inc. ("CNB" or the "Company") was
         organized under the laws of West Virginia in March 2000 at the
         direction of the Board of Directors of Citizens National Bank (the
         "Bank") for the purpose of becoming a financial services holding
         company. The Company's primary function is to direct, plan and
         coordinate the business activities for the Bank and its subsidiary. We
         refer to the Company and its subsidiary as "CNB".

                  On August 31, 2000, the Bank, via merger, became a
         wholly-owned subsidiary of the Company and the shareholders of the Bank
         became shareholders of the Company. Each Bank shareholder received two
         shares of the Company stock for each share of the Bank's common stock.
         The merger was accounted for as a pooling of interests.

                  The Bank was organized on June 20, 1934, and has operated in
         Berkeley Springs, Morgan County, West Virginia, as a national banking
         association continuously since that time. The Bank is a full-service
         commercial bank conducting general banking and trust activities through
         four full-service offices and four automated teller machines located in
         Morgan and Berkeley Counties, West Virginia. The Bank formed CNB
         Insurance Services, Inc., a wholly owned subsidiary, which is a
         property and casualty insurance agency selling primarily personal lines
         of insurance.

                  The Bank purchased a parcel of land in Berkeley County, West
         Virginia on April 20, 2001 for $450,000 to construct a new branch
         facility. The Bank leased a parcel of land adjacent to the purchased
         land and rented a temporary facility in which to conduct business while
         the permanent bank building was under construction. The temporary
         facility opened for business in August 2001. Construction on the
         permanent facility began in September 2001 and was completed in March
         2002. On March 18, 2002, the temporary facility was closed, and the new
         branch building opened.

                  The following discussion and analysis presents the significant
         changes in financial condition and results of operations of CNB for the
         three and nine months ended September 30, 2002 and 2001. This
         discussion may include forward-looking statements based upon
         management's expectations. Actual results may differ. We have rounded
         amounts and percentages used in this discussion and have based all
         average balances on monthly averages.

EARNINGS SUMMARY

                  Net income for the three months ended September 30, 2002 was
         $297,000, or $0.65 per share compared to $359,000 or $0.78 per share
         for the same period in 2001. Annualized return on average assets and
         average equity were .63% and 7.48% respectively, for the three months
         ended September 30, 2002, compared with .90% and 9.94%, respectively,
         for the three months ended September 30, 2001.

                  Net income for the nine months ended September 30, 2002 was
         $937,000, or $2.05 per share compared to $980,000 or $2.14 per share
         for the same period in 2001. Annualized return on average assets and
         average equity were .69% and 8.15% respectively, for the nine months
         ended September 30, 2002, compared with .83% and 9.10%, respectively
         for the nine months ended September 30, 2001.

NET INTEREST INCOME

                  Net interest income represents the primary component of CNB's
         earnings. It is the difference between interest and fee income related
         to earning assets and interest expense incurred to carry
         interest-bearing liabilities. Changes in the volume and mix of interest
         earning assets and interest bearing liabilities, as well as changing
         interest rates impact net interest income. To manage these changes,
         their impact on net interest income and the risk associated with them,
         CNB utilizes an ongoing asset/liability management program. This
         program includes analysis of the difference between rate sensitive
         assets and rate sensitive liabilities, earnings sensitivity to rate


                                       12
<PAGE>

         changes, and source and use of funds. A discussion of net interest
         income and the factors impacting it is presented below.

                  Net interest income for the three months ended September 30,
         2002 decreased by $13,000 or 0.9% over the same period in 2001.
         Interest income for the three months ended September 30, 2002 decreased
         by $168,000 or 5.6% compared to the same period in 2001, while interest
         expense decreased by $155,000 or 10.4% during the three months ended
         September 30, 2002, as compared to the same period in the prior year.

                  During the third quarter of 2002 compared to the same period
         in 2001, average net interest earning assets increased $24.5 million or
         16.3% and average net interest bearing liabilities increased $21.1
         million or 16.9% resulting in decreased net interest income. However,
         CNB experienced a 58 basis point decrease in the net interest margin.
         The 169 basis point decrease in rates earned on average interest
         earning assets offset by a 111 basis point decrease in rates paid on
         average interest bearing liabilities contributed to the decrease in the
         net interest margin. See Table 1 and Table 2 - Distribution of Assets,
         Liabilities, and Shareholders' Equity; Interest Rates and Interest
         Differential.

                  Net interest income for the nine months ended September 30,
         2002 increased by $52,000 or 1.2% over the same period in 2001.
         Interest income for the nine months ended September 30, 2002 decreased
         by $369,000 or 4.1% compared to the same period in 2001, while interest
         expense decreased by $420,000 or 9.4% during the three months ended
         September 30, 2002, as compared to the same period in the prior year.

                  During the nine months ended September 30, 2002 compared to
         the same period in 2001, average net interest earning assets increased
         $20.7 million or 13.9% and average net interest bearing liabilities
         increased $18.7 million or 15.1%. However, CNB experienced a 23 basis
         point decrease in the net interest margin, resulting in decreased net
         interest income. The 126 basis point decrease in rates earned on
         average interest earning assets offset by a 103 basis point decrease in
         rates paid on average interest bearing liabilities resulted in the
         decrease in the net interest margin. See Table 1 and Table 2 -
         Distribution of Assets, Liabilities, and Shareholders' Equity; Interest
         Rates and Interest Differential.

                  There was a significantly higher level of net earning assets
         offset by a decrease in the net interest margin during these periods.
         During 2001 and into the second quarter of 2002, the Bank enjoyed
         substantial deposit growth but slower loan growth resulting in a lower
         loan to deposit ratio. In the third quarter of 2002, loan growth began
         to show a slight increase due to increased activity in Berkeley County,
         refinancing, the new loan programs the Bank began offering and the
         hiring of a lending specialist in Berkeley County. Management continued
         to fund the loan growth with deposits and the excess deposit growth was
         invested in high quality US government agency securities, mortgage
         backed securities or overnight federal funds. Due to the slower loan
         demand, the Bank has experienced a shift in the asset mix from higher
         yielding loans to a greater emphasis in lower yielding overnight
         federal funds and investment securities. Although the average balance
         on investment securities and loans increased, total interest earned
         decreased due to a decrease in the average rates earned on interest
         earning assets. Although the average balance on all interest bearing
         liabilities increased, total interest expense decreased due to a
         decrease in the average rates paid on all interest bearing liabilities.

                  The net interest margin is impacted by the change in the
         spread between yields on earning assets and rates paid on interest
         bearing liabilities.



                                       13
<PAGE>

     TABLE 1. DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY;
                    INTEREST RATES AND INTEREST DIFFERENTIAL
<TABLE>
<CAPTION>
                                                           SEPTEMBER 30, 2002                       SEPTEMBER 30, 2001
                                               ---------------------------------------     ----------------------------------------
                                                    QTR                                        QTR
                                                   AVERAGE           QTR       YIELD/         AVERAGE          QTR         YIELD/
                                                   BALANCE         INTEREST    RATE (4)       BALANCE        INTEREST      RATE (4)
                                               ---------------------------------------     -----------------------------------------
                                                                             (IN THOUSANDS OF DOLLARS)
<S>                                                 <C>            <C>         <C>              <C>              <C>      <C>
Interest earning assets:
    Federal funds sold                            $   7,167       $    30        1.65 %         $   4,408       $    41     3.40 %
    Securities:
      Taxable                                        46,862           567        4.84              38,159           585     6.13
      Tax-exempt (1)                                    889            10        6.82                 295             4     8.22
    Loans (net of unearned interest) (2)(5)(6)      120,081         2,176        7.25             107,647         2,399     8.91
                                                 -------------------------------------         ----------------------------------
        Total interest earning assets (1)         $ 174,999       $ 2,783        6.36 %         $ 150,509       $ 3,029     8.05 %
                                                 -------------------------------------         ----------------------------------
Nonearning assets:
    Cash and due from banks                       $   7,056                                     $   3,567
    Bank premises and equipment, net                  4,759                                         3,872
    Other assets                                      2,523                                         2,166
    Allowance for loan losses                        (1,417)                                       (1,274)
                                                 -----------                                   -----------
        Total assets                              $ 187,920                                     $ 158,840
                                                 ===========                                   ===========

Interest bearing liabilities:
    Savings deposits                              $  20,470       $    25        0.49 %         $  16,781       $    68     1.62 %
    Time deposits                                    95,625         1,217        5.09              84,778         1,289     6.08
    NOW accounts                                     24,767            81        1.31              18,630           109     2.34
    Money market accounts                             5,014            12        0.96               4,595            23     2.00
    Borrowings                                            -             -                               -             -        -
                                                 -------------------------------------         ----------------------------------
        Total interest bearing liabilities        $ 145,876       $ 1,335        3.66 %         $ 124,784       $ 1,489     4.77 %
                                                 -------------------------------------         ----------------------------------

Noninterest bearing liabilities:
    Demand deposits                                $ 24,092                                     $  17,715
    Other liabilities                                 2,062                                         1,899
    Shareholders' equity                             15,890                                        14,442
                                                 -----------                                   -----------
        Total liabilities and
           shareholders' equity                   $ 187,920                                     $ 158,840
                                                 ===========                                   ===========

                                                               -----------                                   -----------
Net interest income (1)                                           $ 1,448                                       $ 1,540
                                                               ===========                                   ===========

Net interest spread (3)                                                          2.70 %                                     3.28 %
                                                                             =========                                    =======

Net interest income to average
    interest earning assets (1)                                                   3.31 %                                     4.09 %
                                                                             =========                                    =======
</TABLE>

(1) Yields are expressed on a tax equivalent basis using a 34% tax rate.
(2) For the purpose of these computations, nonaccruing loans are included in the
    amounts of average loans outstanding.
(3) Net interest spread is the difference between the weighted average yield on
    interest-earning assets and the weighted average cost of interest-bearing
    liabilities.
(4) Yields/Rates are expressed on annualized basis.
(5) Interest income on loans excludes fees of $78,000 in 2002 and $101,000 in
    2001.
(6) Interest income on loans includes fees of $28,031 in 2002 and $49,574 in
    2001 from the Business Manager Program, student loans and lease
    receivables.



                                       14
<PAGE>

     TABLE 2. DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY;
                    INTEREST RATES AND INTEREST DIFFERENTIAL
<TABLE>
<CAPTION>
                                                           SEPTEMBER 30, 2002                         SEPTEMBER 30, 2001
                                               ---------------------------------------     ----------------------------------------
                                                    YTD                                        YTD
                                                   AVERAGE       YTD         YIELD/          AVERAGE          YTD         YIELD/
                                                   BALANCE     INTEREST      RATE (4)         BALANCE       INTEREST      RATE (4)
                                               ---------------------------------------     -----------------------------------------
                                                                             (IN THOUSANDS OF DOLLARS)
<S>                                                 <C>        <C>         <C>              <C>              <C>          <C>
Interest earning assets:
   Federal funds sold                           $   4,850       $    66          1.64 %         $ 3,974         $ 131      4.38 %
   Securities:
     Taxable                                       48,039         1,756          4.87            36,812         1,732      6.27
     Tax-exempt (1)                                   622            19          6.17               302            11      7.36
   Loans (net of unearned interest) (2)(5)        115,760         6,481          7.46           107,533         6,842      8.48
                                               ---------------------------------------      ------------------------------------
        Total interest earning assets (1)       $ 169,271       $ 8,322          6.56 %       $ 148,621       $ 8,716      7.82 %
                                               ---------------------------------------      ------------------------------------
Nonearning assets:
   Cash and due from banks                      $   6,580                                       $ 3,613
   Bank premises and equipment, net                 4,549                                         3,559
   Other assets                                     2,441                                         2,153
   Allowance for loan losses                       (1,394)                                       (1,259)
                                               -----------                                  ------------
        Total assets                            $ 181,447                                     $ 156,687
                                               ===========                                  ============

Interest bearing liabilities:
   Savings deposits                             $  19,278       $    91          0.63 %        $ 16,513         $ 225      1.82 %
   Time deposits                                   94,978         3,694          5.19            83,111         3,800      6.10
   NOW accounts                                    22,671           236          1.39            18,794           377      2.67
   Money market accounts                            5,076            40          1.05             4,847            77      2.12
   Borrowings                                           -             -                              59             2      4.52
                                               ---------------------------------------      ------------------------------------
        Total interest bearing liabilities      $ 142,003       $ 4,061          3.81 %       $ 123,324       $ 4,481      4.84 %
                                               ---------------------------------------      ------------------------------------

Noninterest bearing liabilities:
   Demand deposits                               $ 22,178                                      $ 17,082
   Other liabilities                                1,938                                         1,923
   Shareholders' equity                            15,328                                        14,358
                                            --------------                                  ------------
        Total liabilities and
           shareholders' equity                 $ 181,447                                     $ 156,687
                                            ==============                                  ============

                                                              ----------                                      ----------
Net interest income (1)                                         $ 4,261                                         $ 4,235
                                                              ==========                                      ==========

Net interest spread (3)                                                          2.75 %                                    2.98 %
                                                                             =========                                    =======

Net interest income to average
   interest earning assets (1)                                                   3.36 %                                    3.80 %
                                                                            =========                                    ======
</TABLE>

(1) Yields are expressed on a tax equivalent basis using a 34% tax rate.
(2) For the purpose of these computations, nonaccruing loans are included in
    the amounts of average loans outstanding.
(3) Net interest spread is the difference between the weighted average yield on
    interest-earning assets and the weighted average cost of interest-bearing
    liabilities.
(4) Yields/Rates are expressed on annualized basis.
(5) Interest income on loans excludes fees of $251,000 in 2002 and $227,000 in
    2001.
(6) Interest income on loans includes fees of $128,309 in 2002 and $149,875 in
    2001 from the Business Manager Program, student loans and lease receivables.



                                       15
<PAGE>

         PROVISION FOR LOAN LOSSES

                  The amount charged to provision for loan losses is based on
         management's evaluation of the loan portfolio. Management determines
         the adequacy of the allowance for loan losses, based on past loan loss
         experience, current economic conditions and composition of the loan
         portfolio. The allowance for loan losses is the best estimate of
         management of the probable losses which have been incurred as of a
         balance sheet date.

                  The provision for loan losses is a charge to earnings which is
         made to maintain the allowance for loan losses at a sufficient level.
         The provision for loan losses for the three months ended September 30,
         2002, and September 30, 2001, amounted to $41,000 and $57,000,
         respectively. The provision for loan losses for the nine months ended
         September 30, 2002, and September 30, 2001, amounted to $152,000 and
         $169,000, respectively. Loan quality remains stable and past due and
         nonaccruals are minimal. Management believes the allowance for loan
         losses is adequate and is not aware of any information relating to the
         loan portfolio which it expects will materially impact future operating
         results, liquidity or capital resources. In addition, federal
         regulators may require additional reserves as a result of their
         examination of the bank. See "Nonperforming Assets and Allowance for
         Loan Losses" for further discussion.

         NONINTEREST INCOME

                  Noninterest income for the three months ended September 30,
         2002 increased $41,000 or 14.6% to $328,000 from $287,000 in the third
         quarter of 2001. The Bank began offering a new service to checking
         deposit account holders in April 2001. Bounce Protection is a form of
         overdraft protection which enables the customer to have their
         insufficient funds checks paid instead of returned. The customer is
         charged a fee for each check paid. Fees generated from the Bounce
         Protection program, overdraft fees and debit cards offset by a decrease
         in insurance commissions and title insurance commissions were the
         primary reasons for the increase in noninterest income.

                  Noninterest income for the nine months ended September 30,
         2002 increased $327,000 or 44.9% to $1.1 million from $728,000 for the
         same period in 2001. The increase in noninterest income was
         attributable to fees generated from the Bounce Protection program,
         debit card income, title insurance commissions, gain on sale of
         securities and gain on sale of other real estate owned. Other factors
         contributing to the increase in noninterest income are the increase in
         trust fees due to continued growth of trust assets managed by the Bank
         and in March 2002, one of the Bank's Board of Directors passed away and
         the Bank was the beneficiary of a life insurance policy on the
         director. The Bank received $43,379 in a death benefit, $21,645 of
         which was recorded in assets as cash surrender value. The difference of
         $21,734 is reflected in other operating income.

         NONINTEREST EXPENSES

                  Noninterest expenses for the three months ended September 30,
         2002, increased $134,000 or 11.0% primarily due to increases in
         salaries and benefits, furniture, fixtures and equipment expenses and
         other operating expenses offset by a decrease in occupancy expenses.
         Salaries and employee benefits increased due to normal recurring merit
         increases, increased health insurance costs and additional hiring for
         the south Martinsburg branch facility and in the normal course of
         business. The increase in furniture and equipment expense was due to an
         increase in depreciation expense related to furniture and equipment
         acquired for the new south Martinsburg branch and the new computer
         equipment and peripherals associated with the upgrade of the Bank's
         technology systems. The increase in other operating expenses was due to
         an increase in audit fees and check losses offset by decreases in
         bounce protection expenses and promotional expenses.

                  Noninterest expenses for the nine months ended September 30,
         2002, increased $468,000 or 13.4% to $4.0 million from $3.5 million for
         the first nine months of 2001. The increases were primarily due to
         higher costs associated with salaries and benefits, furniture, fixture
         and equipment expense and other operating expenses. Salaries and
         employee benefits increases were the result of normal recurring merit
         increases, increased health insurance costs and additional hiring for
         the south Martinsburg branch facility and in the normal course of
         business. Higher advertising, telephone expenses, ATM expenses, audit
         fees and check losses offset by decreases in stationary,


                                       16
<PAGE>

         supplies and printing, outside service fees and business manager
         expense accounted for the increase in other operating expenses.

         INCOME TAXES

                  The Bank's provision for income taxes decreased $27,000 or
         14.4% to $160,000 for the three months ended September 30, 2002 and
         decreased $29,000 or 5.5% to $505,000 for the nine months ended
         September 30, 2002. The effective tax rates for the third quarter of
         2002 and 2001 were 35.1% and 34.3%, respectively and for the first nine
         months of 2002 and 2001 were 35.0% and 35.3%, respectively. The Bank's
         lower effective tax rate for the first nine months of 2002 compared to
         the first nine months of 2001, is due to an increase in nontaxable
         income, principally life insurance proceeds. The decrease in the income
         tax provision in 2002 is attributable to lower taxable income. The
         Bank's income tax expense differs from the amount computed at statutory
         rates primarily due to the tax-exempt earnings from certain investment
         securities.

         FINANCIAL CONDITION

                  The Bank's total assets at September 30, 2002 increased $18.7
         million or 10.9% to $190.3 million from December 31, 2001 due primarily
         to a $5.0 million increase in federal funds sold, a $9.4 million
         increase in loans and a $4.6 million increase in cash and due from
         banks offset by a $493,000 decrease in investment securities. The
         Bank's total liabilities increased $17.4 million or 11.1% to $174.0
         million at September 30, 2002, consisting entirely of deposit growth,
         which increased to $171.8 million. Shareholders' equity increased $1.3
         million to $16.2 million at September 30, 2002, primarily due to net
         income of $937,000 and a $549,000 increase in accumulated other
         comprehensive income offset by the semi-annual cash dividend of
         $165,000. The only component of accumulated other comprehensive income
         at September 30, 2002, was unrealized gains and losses on available for
         sale securities, net of deferred income taxes. The unrealized gains and
         losses are primarily a function of available market interest rates
         relative to the yield being generated on the available for sale
         portfolio. No earnings impact results, however, unless the securities
         are actually sold.

         LOAN PORTFOLIO

                  At September 30, 2002, total loans increased $9.4 million or
         8.5% to $119.9 million from $110.5 million at December 31, 2001. The
         loan mix did not change in any material respect compared with December
         31, 2001. The loan portfolio increase is the result of new mortgage
         loans. The Bank believes additional growth in all lending areas is
         possible during the remainder of 2002.


         NONPERFORMING ASSETS AND ALLOWANCE FOR LOAN LOSSES

                   Nonperforming assets consist of nonaccrual loans, loans which
         are past due 90 days or more and still accruing interest, restructured
         loans and other real estate owned. The following table summarized the
         Bank's nonperforming assets as of the periods shown:

<TABLE>
<CAPTION>
                                                       SEPTEMBER 30,         DECEMBER 31,
                                                 ------------------------    -----------
                                                    2002           2001          2001
                                                 ----------   -----------    -----------
<S>                                               <C>           <C>           <C>
         Nonaccrual loans                        $   9,338     $   7,315      $  25,173

         Loans past due 90 days or more
             still accruing interest               116,145       207,335        449,675
                                                 ----------   -----------    -----------
          Total nonperforming loans              $ 125,483     $ 214,650      $ 474,848
                                                 ----------   -----------    -----------

          Other real estate owned                  $ 6,500      $ 12,599       $ 14,899
                                                 ----------   -----------    -----------

          Total nonperforming assets             $ 131,983     $ 227,249      $ 489,747
                                                 ==========   ===========    ===========

          Nonperforming loans/Total loans            0.10%         0.20%          0.43%
          Nonperforming assets/Total assets          0.07%         0.14%          0.29%
          Allowance for loan losses/Total loans      1.19%         1.19%          1.21%
</TABLE>



                                       17
<PAGE>


                  As of September 30, 2002, the Bank has no loans which
         management considers to be impaired. Management is aware of two
         mortgage loans with aggregate uninsured balances of $275,817 which the
         borrowers have exhibited weaknesses. A specific allowance of $50,000
         related to these loans has been established as part of the allowance
         for loan losses. The loans are collateralized and management
         anticipates any additional potential loss would be minimal.

                  The allowance for loan losses is the best estimate by
         management of the probable losses which have been incurred as of a
         balance sheet date. Management makes this determination quarterly by
         its analysis of overall loan quality, changes in the mix and size of
         the loan portfolio, previous loss experience, general economic
         conditions, information about specific borrowers and other factors. The
         Bank's methodology for determining the allowance for loan losses
         established both an allocated and an unallocated component. The
         allocated portion of the allowance represents the results of analyses
         of individual loans that the Bank monitors for potential credit
         problems and pools of loans within the portfolio. Management bases the
         allocated portion of the allowance for loans principally on current
         loan risk ratings, historical loan loss rates adjusted to reflect
         current conditions, as well as analyses of other factors that may have
         affected the collectibility of loans in the portfolio. The Bank
         analyzes all commercial loans it is monitoring as potential credit
         problems to determine whether those loans are impaired, with impairment
         measured by reference to the borrowers' collateral values and cash
         flows.

                  The unallocated portion of the allowance for loan losses
         represents the results of analyses that measure probable losses
         inherent in the portfolio that are not adequately captured in the
         allocated allowance analyses. These analyses include consideration of
         unidentified losses inherent in the portfolio resulting from changing
         underwriting criteria, changes in the types and mix of loans
         originated, industry concentrations and evaluations, allowance levels
         relative to selected overall credit criteria and other economic
         indicators used to estimate probable incurred losses. At September 30,
         2002, and December 31, 2001, the allowance for loans losses totaled
         $1.4 million and $1.3 million, respectively. The allowance for loans
         losses as a percentage of loans was 1.19% and 1.21% as of September 30,
         2002 and December 31, 2001.

                  An analysis of the allowance for loan losses is summarized
         below:
<TABLE>
<CAPTION>
In thousands                           SEPTEMBER 30,                    DECEMBER 31,
                              -----------------------------     ------------------------------
                                           2002                           2001
                              -----------------------------     ------------------------------
                                               PERCENT OF                       PERCENT OF
                                              LOANS IN EACH                    LOANS IN EACH
                                               CATEGORY TO                      CATEGORY TO
                                 AMOUNT       TOTAL LOANS        AMOUNT        TOTAL LOANS
                               ---------     -------------     ----------     --------------
<S>                            <C>           <C>               <C>             <C>
Commercial, financial             $ 301               7 %          $ 363               6 %
    and agriculture
Real estate - mortgage              364              74              294              72
Installment and other               372              19              370              22
Unallocated                         385             N/A              310             N/A
                              ----------     -------------     ----------     --------------
       Total                    $ 1,422             100 %        $ 1,337             100 %
                              ==========     =============     ==========     ==============
</TABLE>



                                       18
<PAGE>

         DEPOSITS

                  The Bank's deposits increased $17.4 million or 11.3% during
         the nine months ended September 30, 2002. The Bank has experienced a
         slight change in the deposit account mix during the first nine months
         of 2002. Steady growth continues in noninterest-bearing and
         interest-bearing demand and savings deposits. The Bank has experienced
         a slight shift from other time deposits to rate sensitive jumbo
         certificate of deposits during the first nine months of 2002. The
         increase in noninterest-bearing and interest-bearing deposits is
         primarily due to the influx of accounts at the south Martinsburg
         Branch. The increase in jumbo certificates of deposit is primarily due
         to the continued growth in the 36-month Ultimate Certificate of
         Deposit. The Bank's 36-month Ultimate Certificate of Deposit allows the
         customer to withdraw all or a portion of the CD on the first or second
         year anniversary date without penalty. Deposits may also be made to
         this CD at any time.

         CAPITAL RESOURCES

                  Shareholders' equity increased $1.3 million or 8.9% during the
         first nine months of 2002 due to $937,000 in net income and a $549,000
         increase in accumulated other comprehensive income partially offset by
         the semi-annual cash dividend of $165,000. The Bank is subject to
         regulations of the Office of the Comptroller of the Currency that
         impose certain minimum regulatory capital requirements. Under each
         measure, the Bank was substantially in excess of the minimum regulatory
         requirements, and, by definition was "well capitalized" at September
         30, 2002. The following table summarized, as of September 30, 2002, the
         Bank's capital ratios.
<TABLE>
<CAPTION>
                                                     Components            Actual        Required
                                                     of Capital            Ratio           Ratio
                                                     ----------            ------        --------
<S>                                                    <C>                  <C>            <C>
         Tier 1 Capital                                $15,510              8.3%           4.0%
         Total Risk Based Capital                      $16,866             15.6%           8.0%
</TABLE>

         ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

                  Market risk is the exposure to economic loss that arises from
         changes in the values of certain financial instruments. The types of
         market risk exposures generally faced by banking entities include
         interest rate risk, equity market price risk, foreign currency risk and
         commodity price risk. Due to the nature of its operations, only equity
         market price risk and interest rate risk are significant to the Bank.

                  The objective of the Bank's liquidity management program is to
         ensure the continuous availability of funds to meet the withdrawal
         demands of depositors and the credit needs of borrowers. The basis of
         the Bank's liquidity comes from the stability of its core deposits.
         Liquidity is also available through the available for sale securities
         portfolio and short-term funds such as federal funds sold. At September
         30, 2002, these totaled $53.4 million, or 28.1% of total assets. In
         addition, liquidity may be generated through loan repayments and over
         $7.0 million of available borrowing arrangements with correspondent
         banks. At September 30, 2002, management considered the Bank's ability
         to satisfy its anticipated liquidity needs over the next twelve months.
         Management believes that the Bank is well positioned and has ample
         liquidity to satisfy these needs. The Bank generated $1.6 million of
         cash from operations in the first nine months of 2002, which compares
         to $1.0 million during the same time period in 2001. Additional cash of
         $17.2 million was generated through net financing activities through
         September 30, 2002, which compares to $14.4 million for the first nine
         months of 2001. These proceeds along with proceeds from the sales and
         maturities of investment securities were used to fund loans and
         purchase securities during each year. Net cash used in investing
         activities totaled $14.2 million during the first nine months of 2002
         compared to $14.9 million during the same time period in 2001. Details
         on both the sources and uses of cash are presented in the Consolidated
         Statements of Cash Flows contained in the financial statements.

                  The objective of the Bank's interest rate sensitivity
         management program, also known as asset/liability management, is to
         maximize net interest income while minimizing the risk of adverse
         effects from changing interest rates. This is done by controlling the
         mix and maturities of



                                       19
<PAGE>

         interest sensitive assets and liabilities. The Bank has established an
         asset/liability committee for this purpose. Daily management of the
         Bank's sensitivity of earnings to changes in interest rates within the
         Bank's policy guidelines are monitored by using a combination of
         off-balance sheet and on-balance sheet financial instruments. The
         Bank's Chief Executive Officer, Vice President of Mortgage Loans and
         the Chief Financial Officer monitor day to day deposit flows, lending
         requirements and the competitive environment. Rate changes occur within
         policy guidelines if necessary to minimize adverse effects. Also, the
         Bank's policy is intended to ensure the Bank measures a range of rate
         scenarios and patterns of rate movements that are reasonably possible.
         The Bank measures the impact that 200 basis point changes in rates
         would have on earnings over the next twelve months.

                  In analyzing interest rate sensitivity for policy measurement,
         the Bank compares its forecasted earnings in both a "high rate" and
         "low rate" scenario to a base-line scenario. The Bank's base-line
         scenario is its estimated most likely path for future short-term
         interest rates over the next 12 months. The "high rate" and "low rate"
         scenarios assumes a 100 and 200 basis point increases or decreases in
         the prime rate from the beginning point of the base-line scenario over
         the most current 12-month period. The Bank's policy limit for the
         maximum negative impact on earnings resulting from "high rate" or "low
         rate" scenarios is 10 percent. The policy measurement period is 12
         months in length, beginning with the first month of the forecast.

                  The Bank's base-line scenario holds the prime rate constant at
         4.75 percent through September 2003. Based on the October 2002 outlook,
         if interest rates increased or decreased by 200 basis points, the model
         indicates that net interest income during the policy measurement period
         would be affected by less than 10 percent, in both an increasing or
         decreasing interest rate scenario.


         ITEM 4.  CONTROLS AND PROCEDURES

                  Within the 90 days prior to the date of this report, the
         Company carried out an evaluation, under the supervision and with the
         participation of the Company's management, including the Company's CEO
         and CFO, of the effectiveness of the design and operation of the
         Company's disclosure controls and procedures pursuant to Exchange Act
         Rule 13a-14. Based upon that evaluation, the CEO and CFO concluded that
         the Company's disclosure controls and procedures are effective in
         timely alerting them to material information relating to the Company
         (including its consolidated subsidiaries) required to be included in
         the Company's periodic SEC filings.


                                       20
<PAGE>

                           PART II: OTHER INFORMATION

         Item 1:  Legal Proceedings

                  None; however, CNB is involved in various legal proceedings
                  occurring in the ordinary course of business. There are no
                  material legal proceedings to which CNB or its subsidiary is a
                  part, or to which any of their property is subject.

         Item 6:  Exhibits and Reports on Form 8-K

                  a.    Exhibits

                  Exhibit 99.1   Certification Pursuant to 18 U.S.C. Section
                                 1350, as Adopted Pursuant to Section 906 of the
                                 Sarbanes-Oxley Act of 2002

                  Exhibit 99.2   Certification Pursuant to 18 U.S.C. Section
                                 1350, as Adopted Pursuant to Section 906 of the
                                 Sarbanes-Oxley Act of 2002






                                       21
<PAGE>
                                   SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.


CNB FINANCIAL SERVICES, INC.
       (Registrant)



Date   NOVEMBER 12, 2002             /s/ Rebecca S. Stotler, Vice President/CFO
       -----------------             ------------------------------------------

Date   NOVEMBER 12, 2002             /s/ Thomas F. Rokisky, President/CEO
       ------------------            ------------------------------------------







                                       22
<PAGE>

CERTIFICATIONS

I, Thomas F. Rokisky, certify that:

1. I have reviewed this quarterly report on Form 10-Q of CNB Financial Services,
Inc.;

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 officer 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 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 officer and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

       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 officer 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.


Date:  NOVEMBER 12, 2002

                                         /s/ Thomas F. Rokisky, President/CEO
                                      ------------------------------------------
                                         Thomas F. Rokisky
                                         Chief Executive Officer
                                         November 12, 2002



                                       23
<PAGE>


CERTIFICATIONS

I, Rebecca S. Stotler, certify that:

1. I have reviewed this quarterly report on Form 10-Q of CNB Financial Services,
Inc.;

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 officer 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 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 officer and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):

       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 officer 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.


Date: NOVEMBER 12, 2002

                                              /s Rebecca S. Stotler, VP/CFO
                                              ----------------------------------
                                              Rebecca S. Stotler
                                              Chief Financial Officer
                                              November 12, 2002



                                       24