<PAGE>   1
                                  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 MARCH 31, 2001


          [ ] 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)



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


  212 S. Washington Street, Berkeley Springs, WV                   25411
------------------------------------------------------           -----------
    (Address of principal executive offices)                      (Zip Code)


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 May 10, 2001


<PAGE>   2
                          CNB FINANCIAL SERVICES, INC.

                                TABLE OF CONTENTS


<TABLE>

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

       Item 1.   Financial Statements

                 Independent Accountant's Report.............................................................3

                 Consolidated Statements of Financial Condition as of March 31, 2001 (Unaudited)
                   and December 31, 2000.....................................................................4

                 Consolidated Statements of Income for the Three Months ended March 31, 2001
                   and  2000 (Unaudited).....................................................................5

                 Consolidated Statements of Changes in Shareholders' Equity for the Three
                   Months Ended March 31, 2001 (Unaudited) and the Year Ended December 31, 2000..............6

                 Consolidated Statements of Cash Flows for the Three Months
                   Ended March 31, 2001 and 2000 (Unaudited).................................................7

                 Notes to Consolidated Financial Statements (Unaudited)......................................8

       Item 2.   Management's Discussion and Analysis of Financial Condition and
                   Results of Operations for the Three Months ended March 31, 2001..........................13

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


PART II: OTHER INFORMATION

       Item 1.   Legal  Proceedings.........................................................................20

       Item 6.   Exhibits and Reports on Form 8-K...........................................................20

                 SIGNATURES.................................................................................20
</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>   3

                         INDEPENDENT ACCOUNTANT'S REPORT




Board of Directors
CNB Financial Services, Inc.
Berkeley Springs, West Virginia


         We have reviewed the accompanying consolidated statement of financial
condition of CNB Financial Services, Inc. and Subsidiary as of March 31, 2001
and the related consolidated statement of changes in stockholders' equity for
the three months ended March 31, 2001 and the consolidated statements of income
for the three months ended March 31, 2001 and 2000 and consolidated statements
of cash flows for the three months ended March 31, 2001 and 2000. These
financial statements are the responsibility of CNB Financial Services, Inc.
management.

         We conducted our reviews in accordance with standards established by
the American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements as a whole.
Accordingly, we do not express such an opinion.

         Based on our reviews, we are not aware of any material modifications
that should be made to the accompanying financial statements for them to be in
conformity with generally accepted accounting principles.




                                        /s/ Smith Elliott Kearns & Company, LLC

                                        SMITH ELLIOTT KEARNS & COMPANY, LLC


Hagerstown, Maryland
May 10, 2001




                                       3
<PAGE>   4
                  CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION


<TABLE>
<CAPTION>
                                                             MARCH 31,            DECEMBER 31,
                             ASSETS                             2001                2000
                                                            -----------          -------------
                                                            (Unaudited)
<S>                                                         <C>                  <C>
Cash and due from banks                                     $  4,939,950         $   3,739,854
Federal funds sold                                             5,026,825             1,207,684
Securities available for sale
   (at approximate market value)                              34,384,457            35,374,293
Loans and lease receivable, net                              105,548,217           104,003,931
Accrued interest receivable                                    1,115,036             1,004,257
Premises and equipment, net                                    3,160,815             3,167,302
Deferred income taxes                                            241,188               375,509
Cash surrender value of life insurance                           811,728               790,807
Intangible assets                                                111,681               113,853
Other assets                                                     180,938               204,877
                                                            ------------         -------------

          TOTAL ASSETS                                      $155,520,835         $ 149,982,367
                                                            ============         =============


              LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
   Deposits:
        Demand                                              $ 16,723,284         $  16,164,702
        Interest-bearing demand                               23,641,081            24,012,083
        Savings                                               16,504,551            15,571,297
        Time, $100,000 and over                               18,914,632            17,764,825
        Other time                                            63,060,010            60,482,943
                                                            ------------         -------------
                                                            $138,843,558         $ 133,995,850
   Accrued interest payable                                    1,082,091             1,038,122
   Accrued expenses and other liabilities                      1,217,464             1,084,577
                                                            ------------         -------------

         TOTAL LIABILITIES                                  $141,143,113         $ 136,118,549
                                                            ------------         -------------

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                                           9,952,172             9,657,422
   Accumulated other comprehensive income                        103,910              (115,244)
                                                            ------------         -------------

         TOTAL SHAREHOLDERS' EQUITY                         $ 14,377,722         $  13,863,818
                                                            ------------         -------------

         TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY         $155,520,835         $ 149,982,367
                                                            ============         =============
</TABLE>

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





                                       4
<PAGE>   5
          CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY
         CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

<TABLE>
<CAPTION>

                                                         THREE MONTHS ENDED
                                                              MARCH 31,
                                                   -----------------------------
                                                      2001               2000
                                                   ----------         ----------
<S>                                                <C>                <C>
INTEREST INCOME
   Interest and fees on loans                      $2,291,219         $2,103,410
   Interest and dividends on securities
      United States Treasury securities                   274              6,274
      U.S. Government agencies and
         corporations                                 555,892            490,760
      State and political subdivisions                  7,362             26,770
      Other                                            18,270                 --
   Interest on federal funds sold                      27,402              3,774
                                                   ----------         ----------
                                                   $2,900,419         $2,630,988
                                                   ----------         ----------
INTEREST EXPENSE
   Interest on interest bearing demand,            $1,469,735         $1,235,840
     savings and time deposits
   Interest on federal funds purchased                  2,291              2,423
                                                   ----------         ----------
                                                   $1,472,026         $1,238,263
                                                   ----------         ----------

           NET INTEREST INCOME                     $1,428,393         $1,392,725

PROVISION FOR LOAN LOSSES                              51,000             30,000
                                                   ----------         ----------

           NET INTEREST INCOME AFTER
               PROVISION FOR LOAN LOSSES           $1,377,393         $1,362,725
                                                   ----------         ----------

NONINTEREST INCOME
   Service charges on deposit accounts             $   68,202         $   71,095
   Other service charges, commissions
      and fees                                         56,912             52,926
   Insurance commissions                               29,289             27,714
   Other operating income                              17,092             17,837
   Gain on demutualization of insurance company            --            195,889
   Net gain (loss) on sale of securities                  833                 --
                                                   ----------         ----------
                                                   $  172,328         $  365,461
                                                   ----------         ----------
NONINTEREST EXPENSES
   Salaries                                        $  466,955         $  432,404
   Employee benefits                                  152,793            155,051
   Occupancy of premises                               70,658             81,523
   Furniture and equipment expense                     59,024             67,837
   Other operating expenses                           344,875            387,300
                                                   ----------         ----------
                                                   $1,094,305         $1,124,115
                                                   ----------         ----------

            INCOME BEFORE INCOME TAXES             $  455,416         $  604,071

PROVISION FOR INCOME TAXES                            160,666            205,378
                                                   ----------         ----------

            NET INCOME                             $  294,750         $  398,693
                                                   ==========         ==========

BASIC EARNINGS PER SHARE                           $     0.64         $     0.87
                                                   ==========         ==========
</TABLE>

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




                                       5
<PAGE>   6

                   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 (1)       SURPLUS (1)      EARNINGS (1)       INCOME          EQUITY
                                      ---------       -----------      -----------    -------------     -----------
<S>                                   <C>             <C>               <C>             <C>             <C>
BALANCE, DECEMBER 31, 1999            $ 458,048       $ 3,863,592       $8,818,791      $(891,710)      $12,248,721
Comprehensive income:
   Issuance of common stock              12,000
   Cancellation of stock                (12,000)
   Net income for 2000                       --                --        1,305,840             --                --
  Change in unrealized gains
    (losses) on securities
    available for sale (net of
    tax of $475,898)                         --                --               --        776,466                --
Total Comprehensive Income                   --                --               --             --         2,082,306
Cash dividends ($1.02 per share)             --                --         (467,209)            --          (467,209)
                                      ---------       -----------       ----------      ---------       -----------

BALANCE, DECEMBER 31, 2000            $ 458,048       $ 3,863,592       $9,657,422      $(115,244)      $13,863,818
Comprehensive income:
   Net income for three months
      ended March 31, 2001                   --                --          294,750             --                --
  Change in unrealized gains
    (losses) on securities
    available for sale (net of
    tax of $134,321)                         --                --               --        219,154                --
Total Comprehensive Income                   --                --               --             --           513,904
                                      ---------       -----------       ----------      ---------       -----------

BALANCE, MARCH 31, 2001               $ 458,048       $ 3,863,592       $9,952,172      $ 103,910       $14,377,722
                                      =========       ===========       ==========      =========       ===========
</TABLE>


(1) Restated to reflect the formation of CNB Financial Services, Inc. and the
    acquisition of Citizens National Bank and subsidiary on August 31, 2000 and
    accounted for as a pooling of interests.

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




                                       6
<PAGE>   7
                   CNB FINANCIAL SERVICES, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                              THREE MONTHS ENDED
                                                                                   MARCH 31,
                                                                         -----------------------------
                                                                             2001              2000
                                                                         -----------       -----------
<S>                                                                      <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                               $   294,750       $   398,693
Adjustments to reconcile net income to net cash
   provided by operating activities:
     Depreciation and amortization                                            57,195            63,802
     Provision for loan losses                                                51,000            30,000
     Deferred income taxes                                                        --            50,000
     Net (gain) loss on sale of securities                                      (833)               --
     (Gain) on demutualization of insurance company                               --          (195,889)
     Loss on abandonment of fixed assets                                          --            55,254
     Net decrease in loans held for sale                                          --            65,300
     (Increase) in accrued interest receivable                              (110,779)         (212,256)
     Decrease  in other assets                                                20,422            71,705
     Increase in accrued interest payable                                     43,969            53,301
     (Increase) in cash surrender value on life insurance in excess
          of premiums paid                                                   (15,000)          (18,000)
     Increase in accrued expenses and other liabilities                      132,887           133,614
     Amortization of deferred loan (fees) cost                                10,401            10,459
     (Accretion) of premium and discount on investments                      (11,244)             (548)
                                                                         -----------       -----------
         NET CASH PROVIDED BY OPERATING ACTIVITIES                       $   472,768       $   505,435
                                                                         -----------       -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Net (increase) in loans                                             $(1,605,687)      $(2,004,727)
     Proceeds from sales of securities                                       901,406                --
     Proceeds from maturities of securities                                6,700,000           350,000
     Purchases of securities                                              (6,246,017)       (2,033,992)
     Purchases of premises and equipment                                     (45,020)          (29,518)
     Net (increase) in federal funds sold                                 (3,819,141)               --
     Premiums paid on life insurance                                          (5,921)           (5,921)
                                                                         -----------       -----------
         NET CASH (USED IN) INVESTING ACTIVITIES                         $(4,120,380)      $(3,724,158)
                                                                         -----------       -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Net  increase (decrease) in demand and savings deposits              $ 1,120,834       $  (548,802)
    Net increase in time deposits                                          3,726,874           585,697
    Increase in outstanding checks over bank balance                              --         1,258,048
                                                                         -----------       -----------
         NET CASH PROVIDED BY FINANCING ACTIVITIES                       $ 4,847,708       $ 1,294,943
                                                                         -----------       -----------
         NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS            $ 1,200,096       $(1,923,780)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                             3,739,854         4,035,293
                                                                         -----------       -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                               $ 4,939,950       $ 2,111,513
                                                                         ===========       ===========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
     Cash paid during the period:
               Interest                                                  $ 1,426,005       $ 1,206,461
               Income taxes                                              $    30,000       $        --

</TABLE>

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





                                       7
<PAGE>   8


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


Note 1. Formation of Holding Company

                  In March 2000, Citizens National Bank's (Bank) Board of
         Directors approved the formation of CNB Financial Services, Inc., (CNB)
         a financial services holding company. A special meeting of the Bank's
         shareholders was held on August 4, 2000 and the shareholders approved
         the Agreement and Plan of Merger between the Bank and CNB, whereby the
         Bank became a wholly-owned subsidiary of CNB and the shareholders of
         the Bank became shareholders of CNB. The merger became effective on
         August 31, 2000. Each Bank shareholder received two shares of CNB stock
         for each share of the Bank's common stock. The Bank received approval
         of the reorganization from the Comptroller of the Currency and the
         Federal Reserve Bank of Richmond. Also, the Securities and Exchange
         Commission (SEC) declared the registration statement on Form S-4
         related to the Agreement and Plan of Merger between the Bank and CNB
         effective on July 12, 2000. The Bank incurred and expensed all costs of
         start-up activities including activities related to organizing the new
         entity and filings with the SEC and Bank regulators. On August 31,
         2000, CNB Financial Services, Inc. consummated its merger with the Bank
         and subsidiary, in a tax-free exchange of stock. Shareholders of the
         Bank received two shares of CNB Financial Services, Inc. common stock
         for each of the 229,024 shares of the Bank's common stock. 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 March 31, 2001 and the results of operations for the
         three months ended March 31, 2001 and 2000 and cash flows for the three
         months ended March 31, 2001 and 2000.

                  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 Bank's
         Annual Report for the year ended December 31, 2000.


                                       8
<PAGE>   9


                          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 March 31, 2001 and December 31, 2000 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>
                                                                   MARCH 31, 2001
                                           --------------------------------------------------------------       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
      After 1 but within 5 years          $19,643,876        $  44,278         $ 1,618        $19,686,536          6.46%
      After 5 but within 10 years          13,286,634          119,164           1,250         13,404,548          6.97
                                          -----------        ---------         -------        -----------          ----
                                          $32,930,510        $ 163,442         $ 2,868        $33,091,084          6.67
                                          -----------        ---------         -------        -----------          ----

    States and political subdivisions
      After 1 but within 5 years          $   350,000        $   1,298         $    --        $   351,298          6.75
      After 5 but within 10 years             100,000            2,237              --            102,237          7.33
      After 10 years                          100,000            3,488              --            103,488          8.72
                                          -----------        ---------         -------        -----------          ----
                                          $   550,000        $   7,023         $    --        $   557,023          7.21
                                          -----------        ---------         -------        -----------          ----

    Federal Reserve Bank stock            $   129,650        $      --         $    --        $   129,650          6.00
    Federal Home Loan Bank stock              606,700               --              --            606,700          6.75
                                          -----------        ---------         -------        -----------          ----
                                          $   736,350        $      --         $    --        $   736,350          6.62
                                          -----------        ---------         -------        -----------          ----
Total securities available for sale       $34,216,860        $ 170,465         $ 2,868        $34,384,457          6.67%
                                          ===========        =========         =======        ===========          ----
</TABLE>




                                       9
<PAGE>   10

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

Note 3.   Securities Available for Sale (continued)

<TABLE>
<CAPTION>
                                                                DECEMBER 31, 2000                           WEIGHTED
                                           -----------------------------------------------------------      AVERAGE
                                                             GROSS          GROSS          ESTIMATED          TAX
                                            AMORTIZED      UNREALIZED     UNREALIZED          FAIR         EQUIVALENT
                                              COST           GAINS          LOSSES           VALUE            YIELD
                                           -----------      --------      -----------      -----------     ----------
<C>                                       <C>               <C>          <C>              <C>               <C>
Available for sale:
    U.S. Treasury securities
      After 1 but within 5 years           $   400,432      $  6,443      $        --      $   406,875          6.78%
                                           -----------      --------      -----------      -----------          ----

    U.S. Government agencies
      and corporations
      After 1 but within 5 years           $18,597,039      $ 15,689      $   179,645      $18,433,083          6.40
      After 5 but within 10 years           15,276,363        43,845           76,654       15,243,554          7.01
                                           -----------      --------      -----------      -----------          ----
                                           $33,873,402      $ 59,534      $   256,299      $33,676,637          6.68
                                           -----------      --------      -----------      -----------          ----

    States and political subdivisions
      After 1 but within 5 years           $   350,000      $    810      $        --      $   350,810          6.75
      After 5 but within 10 years              100,000           907               --          100,907          7.33
      After 10 years                           100,000         2,714               --          102,714          8.72
                                           -----------      --------      -----------      -----------          ----
                                           $   550,000      $  4,431      $        --      $   554,431          7.21
                                           -----------      --------      -----------      -----------          ----

    Federal Reserve Bank stock             $   129,650      $     --      $        --      $   129,650          6.00
    Federal Home Loan Bank stock               606,700            --               --          606,700          7.25
                                           -----------      --------      -----------      -----------          ----
                                           $   736,350      $     --      $        --      $   736,350          7.03
                                           -----------      --------      -----------      -----------          ----
Total securities available for sale        $35,560,184      $ 70,408      $   256,299      $35,374,293          6.70%
                                           ===========      ========      ===========      ===========          ====

</TABLE>


                  The carrying value of securities pledged to secure public
         deposits and for other purposes as required or permitted by law totaled
         $10,995,280 at March 31, 2001 and $10,591,329 at December 31, 2000.

                  Proceeds from sales of securities available for sale
         (excluding maturities) during the three months ended March 31, 2001 and
         the year ended December 31, 2000 were $901,406 and $2,659,593,
         respectively. Gross gains (losses) of $7,071 and $(6,238) during the
         three months ended March 31, 2001 and $7,115 and $(21,106) for the year
         ended December 31, 2000 were realized on the respective sales.




                                       10
<PAGE>   11

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


Note 4. Loans and Lease Receivable

                  Major classifications of loans at March 31, 2001 and December
         31, 2000, were as follows:

<TABLE>
<CAPTION>
                                                  MARCH 31,        DECEMBER 31,
                                                    2001              2000
                                                ------------      ------------
<S>                                             <C>               <C>
         Loans:
           Real estate                           $ 65,801,784      $ 65,278,200
           Commercial real estate                  10,110,943         9,944,333
           Consumer                                24,025,525        23,707,840
           Commercial                               6,602,231         6,036,583
           Overdrafts                                  19,704            20,441
                                                -------------      ------------
                                                 $106,560,187      $104,987,397

         Lease:                                       142,094           143,000
                                                -------------     -------------
                                                 $106,702,281      $105,130,397
         Net deferred loan fees,
             premiums and discounts                    90,006            89,867
         Allowance for loan losses                 (1,244,070)       (1,216,333)
                                                -------------     -------------
                                                 $105,548,217      $104,003,931
                                                =============     =============

</TABLE>


                  An analysis of the allowance for possible loan losses is as
         follows:

<TABLE>
<CAPTION>
                                                            MARCH 31,              DECEMBER 31,
                                                 ----------------------------      ------------
                                                     2001             2000             2000
                                                 -----------      -----------      -----------
<S>                                             <C>              <C>              <C>
           Balance, Beginning                    $ 1,216,333      $ 1,147,846      $ 1,147,846
               Provision charged to
                   operations                         51,000           30,000          170,000
               Recoveries                              5,243            7,575           19,494
               Loans charged off                     (28,506)          (9,100)        (121,007)
                                                 -----------      -----------      -----------
           Balance, Ending                       $ 1,244,070      $ 1,176,321      $ 1,216,333
                                                 ===========      ===========      ===========
</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>
                                                            MARCH 31,              DECEMBER 31,
                                                 ----------------------------      ------------
                                                     2001             2000             2000
                                                 -----------      -----------      -----------
<S>                                             <C>              <C>              <C>
           Consumer loans                        $    34,267      $    35,620      $    22,125
                                                 ===========      ===========      ===========
</TABLE>

                  Proceeds from sale of loans during the three months ended
         March 31, 2001 and the year ended December 31, 2000 were $0 and
         $1,027,345, respectively. There were no gains or losses on sale of
         loans.




                                       11
<PAGE>   12


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


Note 5. Time Deposits

                  At March 31, 2001, the scheduled maturities of time deposits
         are as follows:


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

          Within 3 months                  $ 1,514,379            $ 5,665,414
          3 months thru 6 months             2,571,220             14,987,015
          6 months thru 12 months            4,660,354             17,933,043
          Over 12 months                    10,168,679             43,389,170
                                          ------------           ------------
                                          $ 18,914,632           $ 81,974,642
                                          ============           ============

Note 6. Shareholders' Equity

                  On August 31, 2000, CNB consummated its 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.

                  CNB initially issued 12,000 shares of common stock, which were
         redeemed and canceled on August 31, 2000, concurrent with the closing
         of the merger with the Bank.

                  All references in the accompanying consolidated financial
         statements and notes to per share amounts have been restated to reflect
         shares issued in the acquisition of the Bank by CNB. Basic earnings and
         dividends per share have been computed based on 458,048 weighted
         average number of shares outstanding in 2001 and 2000.

Note 7. Gain on Demutualization of Insurance Company

                  The Bank owns several life insurance policies which were
         issued by a mutual insurance company. In January 2000, the insurance
         company demutualized and converted to a stock company. The Bank
         received stock from the insurance company as part of the
         demutualization. There was no direct effect on the Bank's interest as a
         policy holder. The receipt of the stock was accounted for at fair value
         with a gain recognized in income from continuing operations.

Note 8. Acquisition of Land

                  On January 13, 2001, CNB Financial Services, Inc. entered into
         an exclusive option to purchase a parcel of land in Berkeley County,
         West Virginia for $450,000. CNB exercised the option to purchase the
         parcel on April 20, 2001. CNB intends to construct a full-service
         branch location on this site.


                                       12
<PAGE>   13

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 to become a financial services holding company.
         The Company's primary function is to direct, plan and coordinate the
         business activities of the Bank and its subsidiary. We refer to the
         Company and its subsidiary as "CNB".

                  The Bank held a special meeting of its shareholders on August
         4, 2000, and the shareholders approved the Agreement and Plan of Merger
         between the Bank and the Company, whereby the Bank became a
         wholly-owned subsidiary of the Company and the shareholders of the Bank
         became shareholders of the Company. The merger became effective on
         August 31, 2000. Each Bank shareholder received two shares of the
         Company stock for each share of the Bank's common stock. On August 31,
         2000, the Company consummated its merger with the Bank and subsidiary,
         in a tax-free exchange of stock. Shareholders of the Bank received two
         shares of CNB Financial Services, Inc. common stock for each of the
         229,024 shares 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
         three 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 Company exercised an option to purchase a parcel of land
         in Martinsburg, Berkeley County West Virginia for the future site of a
         full-service branch. The Bank expects the branch to open in the first
         quarter of 2002.

                  The following discussion and analysis presents the significant
         changes in financial condition and results of operations of CNB for the
         three months ended March 31, 2001 and 2000. 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 March 31, 2001 was
         $295,000, or $0.64 per share compared to $399,000 or $0.87 per share
         for the same period in 2000. Annualized return on average assets and
         average equity were .77% and 8.33% respectively, for the three months
         ended March 31, 2001, compared with 1.16% and 12.80%, respectively, for
         the three months ended March 31, 2000.

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
         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 March 31, 2001
         increased by $36,000 or 2.6% over the same period in 2000. Interest
         income for the three months ended March 31, 2001 increased by $270,000
         or 10.2% compared to the same period in 2000, while interest expense
         increased by $234,000 or 18.9% during the three months ended March 31,
         2001, as compared to the same period in the prior year.


                                       13
<PAGE>   14


                  During the first quarter of 2001 compared to the same period
         in 2000, average net interest earning assets increased $2.2 million or
         10.0% resulting in increased net interest income. However, CNB
         experienced a 26 basis point decrease in the net interest margin. The
         41 basis point increase in rates paid on average interest bearing
         liabilities compared to only a 6 basis point increase in rates earned
         on average interest earning assets contributed to the decrease in the
         net interest margin. See Table 1 - Distribution of Assets, Liabilities,
         and Shareholders' Equity; Interest Rates and Interest Differential.

                  Increased net interest income for the three month period is
         attributable to a significantly higher level of net interest earning
         assets offset by a decrease in the net interest margin. Total interest
         income increased for the three month period in 2001 compared to the
         same period in 2000 as a result of an increase in the average balance
         and rate earned on average loans and the higher average balance in
         investment securities and federal funds sold. Total interest expense
         increased for the three month period in 2001 compared to the same
         period in 2000 as a result of an increase in the average balance and
         average rates paid on time deposits and NOW accounts.

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



                                       14
<PAGE>   15
     TABLE 1. DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY;
                    INTEREST RATES AND INTEREST DIFFERENTIAL

<TABLE>
<CAPTION>
                                                         MARCH 31, 2001                                MARCH 31, 2000
                                           ----------------------------------------      ----------------------------------------
                                           AVERAGE BALANCE INTEREST   YIELD/ RATE (4)    AVERAGE BALANCE INTEREST   YIELD/ RATE (4)
                                           ----------------------------------------      ----------------------------------------
                                                                      (IN THOUSANDS OF DOLLARS)
<S>                                           <C>            <C>             <C>           <C>            <C>              <C>
Interest earning assets:
   Federal funds sold                         $   2,415       $    27         5.49%         $      27      $     4          5.53%
   Securities:
     Taxable                                     35,518           578         6.51             31,073          501          6.45
     Tax-exempt (1)                                 306             4         7.92              1,497           23          9.31
   Loans (net of unearned interest) (2)(5)      105,909         2,192         8.28             99,411        2,015          8.11
                                              ------------------------------------          ------------------------------------
       Total interest earning assets (1)      $ 144,148       $ 2,801         7.77%         $ 132,008      $ 2,543          7.71%
                                              ------------------------------------          ------------------------------------

Nonearning assets:
   Cash and due from banks                    $   3,917                                     $   2,806
   Bank premises and equipment, net               3,155                                         3,311
   Other assets                                   2,211                                         2,248
   Allowance for loan losses                     (1,234)                                       (1,165)
                                              ---------                                     ----------
       Total assets                           $ 152,197                                     $ 139,208
                                              =========                                     ==========

Interest bearing liabilities:
   Savings deposits                           $  16,004       $    78         1.95%         $  16,719      $    83          1.99%
   Time deposits                                 80,281         1,224         6.10             71,030        1,000          5.63
   NOW accounts                                  18,569           141         3.04             17,276          125          2.89
   Money market accounts                          4,926            27         2.19              4,867           27          2.22
   Borrowings                                       177             2         4.52                136            3          6.31
                                              ------------------------------------          ------------------------------------
       Total interest bearing liabilities     $ 119,957       $ 1,472         4.91%         $ 110,028      $ 1,238          4.50%
                                              ------------------------------------          ------------------------------------

Noninterest bearing liabilities:
   Demand deposits                            $  16,255                                     $  15,615
   Other liabilities                              1,834                                         1,105
   Shareholders' equity                          14,151                                        12,460
                                              ---------                                     ----------
       Total liabilities and
          shareholders' equity                $ 152,197                                     $ 139,208
                                              =========                                     ==========

                                                              --------                                     -------
Net interest income (1)                                       $ 1,329                                      $ 1,305
                                                              ========                                     =======

Net interest spread (3)                                                       2.86%                                         3.21%
                                                                              ====                                          ====

Net interest income to average                                                3.69%                                         3.95%
   interest earning assets (1)                                                ====                                          ====

</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 $99,000 in 2001 and $89,000 in
     2000.


                                       15
<PAGE>   16


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 March 31, 2001, and March 31, 2000,
amounted to $51,000 and $30,000, 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 March 31, 2001 decreased
$193,000 or 52.9% to $172,000 from $365,000 in the first quarter of 2000. In the
first quarter of 2000, the Bank recognized a gain on stock received from the
demutualization of an insurance company of $196,000. The Bank received the stock
in exchange for its previous membership interest as a participating
policyholder.

NONINTEREST EXPENSES

         Noninterest expenses for the three months ended March 31, 2001,
decreased $30,000 or 2.7% primarily due to decreases in other operating
expenses, occupany expense and furniture, fixtures and equipment expenses offset
by an increase in salaries and benefits. The decrease in other operating
expenses and occupany expense was due to higher routine building repairs and
maintenance and the painting of the Main Office branch and the loss associated
with the abandonment of fixed assets in 2000. The increase in salaries and
benefits increased due to normal recurring merit increases and increased health
insurance costs.

INCOME TAXES

         The Bank's provision for income taxes decreased $45,000 or 21.8% to
$161,000 for the three months ended March 31, 2001. The effective tax rates for
the first quarter of 2001 and 2000 were 35.3% and 34.0%. The Bank's higher
effective tax rate for the first quarter of 2001 compared to the first quarter
of 2000, is due to a reduction in tax-exempt earnings on investment securities
offset by decreased taxable income. The decrease in the income tax provision in
2001 is attributable to lower tax-exempt earnings and 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.



                                       16
<PAGE>   17

FINANCIAL CONDITION

         The Bank's total assets increased $5.5 million or 3.7% to $155.5
million from December 31, 2000, to March 31, 2001, due primarily to a $3.8
million increase in federal funds sold and a $1.5 million increase in loans and
a $1.2 million increase in cash and due from banks, which was partially offset
by a $1.0 million decrease in investment securities. The Bank's total
liabilities increased $5.0 million or 3.7% to $141.1 million at March 31, 2001,
consisting primarily of $4.8 million in deposit growth, or 3.6% to $138.8
million. Shareholders' equity increased $514,000 to $14.4 million at March 31,
2001, primarily due to net income of $295,000 and a $219,000 increase in
accumulated other comprehensive income. The only component of accumulated other
comprehensive income at March 31, 2001, was unrealized gains on available for
sale securities, net of deferred income taxes. The unrealized gains 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 March 31, 2001, total loans increased $1.5 million or 1.5% to $105.5
million from $104.0 million at December 31, 2000. The loan mix did not change in
any material respect compared with December 31, 2000. The loan portfolio
increase is the result of new installment loans consisting of higher individual
dollar volume, new mortgage loans and new commercial floor plan loans. The Bank
feels additional growth in all lending areas is possible during the remainder of
2001.

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>
                                                            MARCH 31,                  DECEMBER 31,
                                                   ---------------------------         ------------
                                                     2001               2000               2000
                                                   --------           --------         ------------
<S>                                              <C>                <C>                <C>
Nonaccrual loans                                  $  34,267          $  35,620          $  22,125

Loans past due 90 days or more
    still accruing interest                         205,939            194,114            359,890
                                                  ---------          ---------          ---------
Total nonperforming loans                         $ 240,206          $ 229,734          $ 382,015
                                                  ---------          ---------          ---------

Other real estate owned                           $      --          $  66,938          $      --
                                                  ---------          ---------          ---------

Total nonperforming assets                        $ 240,206          $ 296,672          $ 382,015
                                                  =========          =========          =========

Nonperforming loans/Total loans                       0.23%              0.23%              0.37%
Nonperforming assets/Total assets                     0.15%              0.21%              0.25%
Allowance for loan losses/Total loans                 1.17%              1.19%              1.16%

</TABLE>

         As of March 31, 2001, the Bank has no loans which management considers
to be impaired and is not aware of any potential problem loans other than those
which are on nonaccrual status or past due ninety days or more and still
accruing interest.

         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 with 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



                                       17
<PAGE>   18

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. The Bank has no loans which it considers to
be impaired as of March 31, 2001, and December 31, 2000. At March 31, 2001, and
December 31, 2000, the allowance for loans losses totaled $1.2 million. The
allowance for loans losses as a percentage of loans was 1.17% and 1.16% as of
March 31, 2001 and December 31, 2000.

         An analysis of the allowance for loan losses is summarized below:
<TABLE>
<CAPTION>
                                                            MARCH 31,              DECEMBER 31,
                                                 ----------------------------      ------------
                                                     2001             2000             2000
                                                 -----------      -----------      -----------
<S>                                             <C>              <C>              <C>
           Balance, Beginning                    $ 1,216,333      $ 1,147,846      $ 1,147,846
               Provision charged to
                   operations                         51,000           30,000          170,000
               Recoveries                              5,243            7,575           19,494
               Loans charged off                     (28,506)          (9,100)        (121,007)
                                                 -----------      -----------      -----------
           Balance, Ending                       $ 1,244,070      $ 1,176,321      $ 1,216,333
                                                 ===========      ===========      ===========
</TABLE>

         An analysis of the allocation of allowance for loan losses is
summarized below:

<TABLE>
<CAPTION>
In thousands                             MARCH 31,                          DECEMBER 31,
                               ----------------------------        -----------------------------
                                          2001                                 2000
                               ----------------------------        -----------------------------
                                               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
    and agriculture           $   246               6%            $   206               6%
Real estate - mortgage            261              71                 257              72
Installment and other             347              23                 351              22
Uallocated                        390             N/A                 402             N/A
                              -------             ---             -------             ---
       Total                  $ 1,244             100%            $ 1,216             100%
                              =======             ===             =======             ===
</TABLE>

DEPOSITS

         The Bank's deposits increased $4.8 million or 3.6% during the three
months ended March 31, 2001. The deposit mix remained stable during the first
three months of 2001. However, steady growth continues in rate sensitive jumbo
certificates of deposit, other certificates of deposit and savings deposits. The
increase in jumbo certificates of deposit and other certificates of deposit are
primarily due to the continued growth in the 36-month Ultimate Certificate of
Deposit and the 16-month 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. The 16 month certificate product has an
attractive interest rate relative to competition.



                                       18
<PAGE>   19


CAPITAL RESOURCES

          Shareholders' equity increased $514,000 or 3.7% during the first three
months of 2001 due to $295,000 in net income and an increase in accumulated
comprehensive income of $219,000. 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 March 31, 2001. The following table summarized, as of March 31,
2001, the Bank's capital ratios.

                                    Components         Actual         Required
                                    of Capital         Ratio            Ratio
                                    ----------         ------         --------

Tier 1 Capital                       $14,212             9.3%            4.0%
Total Risk Based Capital             $15,355            16.8%            8.0%


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 March 31, 2001, these totaled $39.4 million, or 25.3% 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 March 31, 2001, 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 $473,000 of cash from operations in the first quarter of
2001, which compares to $500,000 during the same time period in 2000. Additional
cash of $4.8 million was generated through net financing activities through
March 31, 2001, which compares to $1.3 million for the first quarter of 2000.
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 $4.1 million during the first quarter
of 2001 compared to $3.7 million during the same time period in 2000. 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 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, Senior Lending Officer 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 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 assume a 200 basis point increases or
decreases in the prime rate from 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 8.00
percent through March 2002. Based on the April 2001outlook, 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.




                                       19
<PAGE>   20

                           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

         None



                                   SIGNATURES


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


         CNB Financial Services, Inc.
         ----------------------------
                 (Registrant)



         Date   May 11, 2001           /s/ Rebecca S. Brock, Vice President/CFO
                ---------------       -----------------------------------------


         Date   May 11, 2001           /s/ Thomas F. Rokisky, President/CEO
                --------------        -----------------------------------------




                                       20