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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Fiscal Year Ended December 31, 2006
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission File Number
 UNITED HERITAGE BANKSHARES OF FLORIDA, INC.
  Florida
    
    04-3691059(State or other jurisdiction
    
    (I.R.S. Employerof incorporation or organization)
    
    Identification No.)640 East State Road 434, Longwood, Florida
    
    32750(Address of principal executive offices)
    
    (Zip Code)
 (407) 712-6151
 None
  Common Stock, par value $0.01 per share
 o þ
 o
 þ o
 þ
 o o þ
 o þ




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##### Table of Contents



TABLE OF CONTENTS
 PagePART I
    
    
    3Item 1. Description of Business
    
    
    3General
    
    
    3Special Note Regarding Forward-Looking Statements
    
    
    4Critical Accounting Policies
    
    
    4Risk Factors (Item 1A)
    
    
    5Lending Activities
    
    
    8Deposit Activities
    
    
    9Investments
    
    
    9Correspondent Banking
    
    
    10Data Processing
    
    
    10Effect of Governmental Policies
    
    
    10Interest and Usury
    
    
    10Supervision and Regulation
    
    
    10Competition
    
    
    16Employees
    
    
    17Item 1B. Unresolved Staff Comments
    
    
    17Item 2. Properties
    
    
    17Item 3. Legal Proceedings
    
    
    17Item 4. Submission of Matters to a Vote of Security Holders
    
    
    17PART II
    
    
    18Item 5. Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    18Item 6. Selected Financial Data
    
    
    20Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    21Item 7A. Quantitative and Qualitative Disclosures About Market Risk
    
    
    48Item 8. Financial Statements and Supplementary Data
    
    
    48




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PageItem 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    48Item 9A. Controls and Procedures
    
    
    49Item 9B. Other Information
    
    
    49PART III
    
    
    49Item 10. Directors, Executive Officers and Corporate Governance
    
    
    49Item 11. Executive Compensation
    
    
    51Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    56Item 13. Certain Relationships and Related Transactions and Director Independence
    
    
    57Item 14. Principal Accountant Fees and Services
    
    
    58Item 15. Exhibits and Financial Statement Schedule
    
    
    59SIGNATURES
    
    
    61EXHIBIT INDEX
    
    
    63EX-13.1 FINANCIAL STATEMENTSEX-21.1 SUBSIDIARIES OF UNITED HERITAGEEX-23.1 CONSENT OF PUBLIC ACCOUNTING FIRMEX-31.1 SECTION 302 CERTIFICATION OF THE CEOEX-31.2 SECTION 302 CERTIFICATION OF THE TREASUREREX-32.1 SECTION 906 CERTIFICATION OF THE CEOEX-32.2 SECTION 906 CERTIFICATION OF THE TREASURER
  2




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PART I
 
 Item 1. Description of Business
 
 General
    See
 3




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Special Note Regarding Forward-Looking Statements
  
 Critical Accounting Policies
     4




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Risk Factors
 Our future depends on the successful growth of the Bank
  A significant amount of our business is concentrated in real estate lending, and most of this
lending involves Florida real estate
   An inadequate allowance for loan losses would reduce our earnings
   5




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Changes in interest rates affect our profitability and assets
  Regional economic factors may have an adverse impact on our business
  The market value of our investments could decline
    6




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We face strong competition from other banks and financial institutions which can hurt our business
  We do not intend to pay dividends
  Government regulations and policies impose limitations and may result in higher operating costs and
competitive disadvantages
  7




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We cannot predict how changes in technology will impact our business
  We are dependent upon the services of our management team
  
 Lending Activities
     8




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see
   
 Deposit Activities
 see
 
 Investments
    9




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Correspondent Banking
   
 Data Processing
  
 Effect of Governmental Policies
  
 Interest and Usury
  
 Supervision and Regulation
  Bank Holding Company Regulation.
 10




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
    
    charter a bank,
    
    obtain deposit insurance coverage for a newly chartered institution,
    
    establish a new branch office that will accept deposits,
    
    relocate an office, or
    
    merge or consolidate with, or acquire the assets or assume the liabilities of, a federally regulated financial
institution
   11




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Gramm-Leach-Bliley Act .
  Sarbanes-Oxley
Act .
 Bank Regulation .
 12




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see
   
    
    the default of a commonly controlled FDIC insured depository institution; or
    
    any assistance provided by the FDIC to a commonly controlled FDIC insured institution in danger of default.
  Capital Requirements .
 13




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
    
    an institution is well capitalized if it has a total risk-based
capital ratio of 10% or greater, has a Tier 1 risk-based capital
ratio of 6% or greater, has a leverage ratio of 5% or greater and
is not subject to any written capital order or directive to meet
and maintain a specific capital level for any capital measures;
    
    an institution is adequately capitalized if it has a total
risk-based capital ratio of 8% or greater, has a Tier 1
risk-based capital ratio of 4% or greater, and has a leverage
ratio of 4% or greater;
    
    an institution is undercapitalized if it has a total risk-based
capital ratio of less than 8%, has a Tier 1 risk-based capital
ratio that is less than 4% or has a leverage ratio that is less
than 4%;
    
    an institution is significantly undercapitalized if it has a
total risk-based capital ratio that is less than 6%, a Tier 1
risk-based capital ratio that is less than 3% or a leverage ratio
that is less than 3%; and
    
    an institution is critically undercapitalized if its tangible
equity is equal to or less than 2% of its total assets.
  14




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Enforcement Powers .
 Maximum Legal Interest Rates .
 Bank Branching .
 Change of Control .
 15




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Bank Secrecy Act/USA Patriot Act
 Interstate Banking .
 Effect of Governmental Policies .
 
 Competition
  16




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Employees
  
 Item 1B. Unresolved Staff Comments
  
 Item 2. Description of Properties
  
 Item 3. Legal Proceedings
  
 Item 4. Submission of Matters to a Vote of Security Holders
   17




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PART II
 
 Item 5. Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities
  2006
    
    2005High
    
    Low
    
    Shares
    
    High
    
    Low
    
    Shares1st Quarter
    
    $
    16
    
    
    $
    14
    
    
    
    3,639
    
    
    $
    
    
    
    $
    
    
    
    
    2nd Quarter
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    10
    (1)
    
    $
    10
    (1)
    
    
    3,500
    (1)3rd Quarter
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    15
    
    
    $
    15
    
    
    
    1004th Quarter
    
    $
    20
    
    
    $
    16
    
    
    
    80,115
    
    
    $
    
    
    
    $
    
    
    
    
    
 
 (1)
    
    This trade was not an arm-length transaction.  Dividends
 
 18




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Item 6. Selected Financial Data
 ($ in thousands, except per share data)
 At or For the Year Ended December 31,2006
    
    2005
    
    2004
    
    2003
    
    2002Interest income
    
    $
    45,887
    
    
    
    29,282
    
    
    
    16,655
    
    
    
    13,553
    
    
    
    5,762Interest expense
    
    $
    21,214
    
    
    
    12,206
    
    
    
    5,913
    
    
    
    5,589
    
    
    
    2,321Net interest income before provision
for loan losses
    
    $
    24,673
    
    
    
    17,076
    
    
    
    10,742
    
    
    
    7,964
    
    
    
    3,441Provision for loan losses
    
    $
    974
    
    
    
    1,540
    
    
    
    617
    
    
    
    784
    
    
    
    542Net interest income after provision
    
    $
    23,699
    
    
    
    15,536
    
    
    
    10,125
    
    
    
    7,180
    
    
    
    2,899Noninterest income
    
    $
    1,086
    
    
    
    801
    
    
    
    547
    
    
    
    526
    
    
    
    270Noninterest expenses
    
    $
    13,489
    
    
    
    11,073
    
    
    
    7,346
    
    
    
    6,257
    
    
    
    3,301Income (loss) before income taxes
    
    $
    11,296
    
    
    
    5,264
    
    
    
    3,326
    
    
    
    1,449
    
    
    
    (131
    )Income taxes
    
    $
    3,952
    
    
    
    1,929
    
    
    
    1,285
    
    
    
    568
    
    
    
    2Net income (loss)
    
    $
    7,344
    
    
    
    3,335
    
    
    
    2,041
    
    
    
    881
    
    
    
    (133
    )Per share data:Basic earnings per share
    
    $
    1.49
    
    
    
    .74
    
    
    
    .63
    
    
    
    .28
    
    
    
    (0.07
    )Diluted earnings per share
    
    $
    1.39
    
    
    
    .72
    
    
    
    .61
    
    
    
    .27
    
    
    
    (0.07
    )Cash dividends declared
    
    $
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Book value at end of period
    
    $
    13.70
    
    
    
    11.86
    
    
    
    10.35
    
    
    
    9.73
    
    
    
    9.73Common shares outstanding at end of period
    
    
    5,033,741
    
    
    
    4,871,908
    
    
    
    3,263,406
    
    
    
    3,256,888
    
    
    
    2,000,000Weighted average common shares
outstanding (basic) during period
    
    
    4,929,840
    
    
    
    4,512,372
    
    
    
    3,258,687
    
    
    
    3,170,513
    
    
    
    2,000,000Weighted average common shares
outstanding (diluted) during period
    
    
    5,297,662
    
    
    
    4,626,297
    
    
    
    3,359,724
    
    
    
    3,231,971
    
    
    
    2,000,000Total assets at end of period
    
    $
    750,839
    
    
    
    707,894
    
    
    
    406,467
    
    
    
    324,324
    
    
    
    138,645Cash and cash equivalents
    
    $
    82,572
    
    
    
    147,723
    
    
    
    85,971
    
    
    
    60,629
    
    
    
    24,565Securities
    
    $
    203,426
    
    
    
    185,169
    
    
    
    68,640
    
    
    
    56,386
    
    
    
    29,302Loans, net
    
    $
    439,085
    
    
    
    360,425
    
    
    
    241,214
    
    
    
    198,480
    
    
    
    80,162Deposits
    
    $
    657,783
    
    
    
    616,536
    
    
    
    365,642
    
    
    
    286,572
    
    
    
    118,114Borrowings
    
    $
    22,503
    
    
    
    31,884
    
    
    
    6,009
    
    
    
    5,174
    
    
    
    837Shareholders equity
    
    $
    68,973
    
    
    
    57,787
    
    
    
    33,790
    
    
    
    31,676
    
    
    
    19,468Total gross loans
    
    $
    445,294
    
    
    
    365,636
    
    
    
    244,650
    
    
    
    201,354
    
    
    
    81,206Allowance for loan losses
    
    $
    5,557
    
    
    
    4,580
    
    
    
    3,077
    
    
    
    2,526
    
    
    
    1,014Nonperforming loans
    
    $
    49
    
    
    
    44
    
    
    
    94
    
    
    
    491
    
    
    
    Allowance for loan losses as a percentage of
period-end total gross loans
    
    
    1.25
    %
    
    
    1.25
    %
    
    
    1.26
    %
    
    
    1.25
    %
    
    
    1.25
    %Allowance for loan losses as a percentage of
nonperforming gross loans
    
    
    11,300.00
    %
    
    
    10,409.09
    %
    
    
    3,273.40
    %
    
    
    514.46
    %
    
    
    N/ATotal nonperforming loans as a percentage
of total loans
    
    
    .01
    %
    
    
    .01
    %
    
    
    0.04
    %
    
    
    0.24
    %
    
    
    N/ATotal nonperforming loans as a percentage
of total assets
    
    
    .01
    %
    
    NIL
    
    
    
    0.02
    %
    
    
    0.15
    %
    
    
    N/ATotal nonperforming loans and real estate
owned as a percentage of total loans
    
    
    .01
    %
    
    
    .01
    %
    
    
    0.02
    %
    
    
    0.15
    %
    
    
    N/A
 20




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Item 7. Managements Discussion and Analysis
  General
   i.e. i.e.
 21




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Capital Resources, Commitments and Capital Requirements
    Payments Due by PeriodGreater
    
    
    GreaterThan
    
    
    ThanLess
    
    
    1 Year
    
    
    3 Years
    
    
    MoreThan 1
    
    
    Up to 3
    
    
    Up to 5
    
    
    Than 5Contractual Obligations
    
    Total
    
    
    Year
    
    
    Years
    
    
    Years
    
    
    YearsTime deposit maturities
    
    $
    327,511
    
    
    $
    245,744
    
    
    $
    81,417
    
    
    $
    330
    
    
    $
    Borrowings
    
    
    22,503
    
    
    
    22,503
    
    
    
    
    
    
    
    
    
    
    
    Operating leases
    
    
    18,911
    
    
    
    1,260
    
    
    
    2,423
    
    
    
    2,330
    
    
    
    12,898Loan commitments and unused lines of credit
    
    
    85,155
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Standby letters of credit
    
    
    7,807
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Undisbursed construction loans in process
    
    
    75,096
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    $
    536,983
    
    
    $
    269,507
    
    
    $
    83,840
    
    
    $
    2,660
    
    
    $
    12,898
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MinimumTo Be WellCapitalized UnderMinimum Capital
    
    Prompt CorrectiveActual
    
    Requirement
    
    Action ProvisionsAmount
    
    %
    
    Amount
    
    %
    
    Amount
    
    %As of
December 31, 2006:Total capital to Risk-
Weighted assets:Consolidated
    
    $
    74,812
    
    
    
    13.65
    %
    
    $
    43,854
    
    
    
    8.00
    %
    
    $
    
    
    
    
    N/ABank
    
    $
    70,848
    
    
    
    12.95
    %
    
    $
    43,775
    
    
    
    8.00
    %
    
    $
    54,719
    
    
    
    10.00
    %Tier I Capital to Risk-
Weighted Assets:Consolidated
    
    $
    69,255
    
    
    
    12.63
    %
    
    $
    21,927
    
    
    
    4.00
    %
    
    $
    
    
    
    
    N/ABank
    
    $
    65,291
    
    
    
    11.93
    %
    
    $
    21,888
    
    
    
    4.00
    %
    
    $
    32,831
    
    
    
    6.00
    %Tier I Capital
to Average Assets:Consolidated
    
    $
    69,255
    
    
    
    9.50
    %
    
    $
    29,156
    
    
    
    4.00
    %
    
    $
    
    
    
    
    N/ABank
    
    $
    65,291
    
    
    
    8.96
    %
    
    $
    29,133
    
    
    
    4.00
    %
    
    $
    36,416
    
    
    
    5.00
    %As of
December 31, 2005:Total capital to Risk-
Weighted assets:Consolidated
    
    $
    63,178
    
    
    
    13.96
    %
    
    $
    36,200
    
    
    
    8.00
    %
    
    $
    
    
    
    
    N/ABank
    
    $
    61,852
    
    
    
    13.59
    %
    
    $
    36,416
    
    
    
    8.00
    %
    
    $
    45,520
    
    
    
    10.00
    %Tier I Capital to Risk-
Weighted Assets:Consolidated
    
    $
    58,598
    
    
    
    12.95
    %
    
    $
    18,100
    
    
    
    4.00
    %
    
    $
    
    
    
    
    N/ABank
    
    $
    57,272
    
    
    
    12.58
    %
    
    $
    18,208
    
    
    
    4.00
    %
    
    $
    27,312
    
    
    
    6.00
    %Tier I Capital
to Average Assets:Consolidated
    
    $
    58,598
    
    
    
    8.97
    %
    
    $
    26,140
    
    
    
    4.00
    %
    
    $
    
    
    
    
    N/ABank
    
    $
    57,272
    
    
    
    8.77
    %
    
    $
    26,134
    
    
    
    4.00
    %
    
    $
    32,668
    
    
    
    5.00
    %
 23




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Results of Operations
  Year Ended December 31,2006
    
    2005
    
    2004Average equity as a percentage of average assets
    
    
    8.51
    %
    
    
    9.19
    %
    
    
    8.81
    %Equity to total assets at end of period
    
    
    9.19
    %
    
    
    8.16
    %
    
    
    8.31
    %Return on average assets
    
    
    1.04
    %
    
    
    .59
    %
    
    
    .56
    %Return on average equity
    
    
    12.20
    %
    
    
    6.45
    %
    
    
    6.38
    %Noninterest expense to average assets
    
    
    1.91
    %
    
    
    1.97
    %
    
    
    2.02
    %Nonperforming loans as a percentage of total assets
    
    
    .01
    %
    
    NIL%
    
    
    0.02
    %
  Year Ended December 31,2006
    
    2005
    
    2004Loans
    
    
    8.33
    %
    
    
    7.10
    %
    
    
    6.46
    %Investment securities
    
    
    4.23
    %
    
    
    3.75
    %
    
    
    3.01
    %Other interest-earning assets
    
    
    4.95
    %
    
    
    3.29
    %
    
    
    1.28
    %All interest-earning assets
    
    
    6.76
    %
    
    
    5.54
    %
    
    
    4.92
    %Savings, NOW and money-market deposits
    
    
    3.13
    %
    
    
    2.21
    %
    
    
    1.61
    %Time deposits
    
    
    4.58
    %
    
    
    3.49
    %
    
    
    2.75
    %All interest-bearing liabilities
    
    
    3.95
    %
    
    
    2.86
    %
    
    
    2.11
    %Interest-rate spread
    
    
    2.81
    %
    
    
    2.68
    %
    
    
    2.81
    %
   24




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Year Ended December 31,2006
    
    
    2005
    
    
    2004Interest
    
    
    Average
    
    
    
    
    
    
    Interest
    
    
    Average
    
    
    
    
    
    
    Interest
    
    
    AverageAverage
    
    
    and
    
    
    Yield/
    
    
    Average
    
    
    and
    
    
    Yield/
    
    
    Average
    
    
    and
    
    
    Yield/Balance
    
    
    Dividends
    
    
    Rate
    
    
    Balance
    
    
    Dividends
    
    
    Rate
    
    
    Balance
    
    
    Dividends
    
    
    RateInterest-earning assets:Loans
    
    $
    401,979
    
    
    
    33,504
    
    
    
    8.33
    %
    
    $
    296,699
    
    
    $
    21,070
    
    
    
    7.10
    %
    
    $
    219,946
    
    
    $
    14,202
    
    
    
    6.46
    %Securities
    
    
    188,871
    
    
    
    7,987
    
    
    
    4.23
    
    
    
    129,166
    
    
    
    4,849
    
    
    
    3.75
    
    
    
    54,277
    
    
    
    1,633
    
    
    
    3.01Other (1)
    
    
    88,838
    
    
    
    4,396
    
    
    
    4.95
    
    
    
    102,280
    
    
    
    3,363
    
    
    
    3.29
    
    
    
    64,017
    
    
    
    820
    
    
    
    1.28Total interest-earning
assets
    
    
    679,688
    
    
    
    45,887
    
    
    
    6.76
    
    
    
    528,145
    
    
    
    29,282
    
    
    
    5.54
    
    
    
    338,240
    
    
    
    16,655
    
    
    
    4.92Noninterest-earning assets
    
    
    27,246
    
    
    
    
    
    
    
    
    
    
    
    34,492
    
    
    
    
    
    
    
    
    
    
    
    25,165Total assets
    
    $
    706,934
    
    
    
    
    
    
    
    
    
    
    $
    562,637
    
    
    
    
    
    
    
    
    
    
    $
    363,405Interest-bearing liabilities:Savings, NOW and money-
market deposits
    
    
    232,615
    
    
    
    7,288
    
    
    
    3.13
    
    
    
    208,336
    
    
    
    4,601
    
    
    
    2.21
    
    
    
    151,834
    
    
    
    2,446
    
    
    
    1.61Time deposits
    
    
    280,071
    
    
    
    12,840
    
    
    
    4.58
    
    
    
    211,832
    
    
    
    7,392
    
    
    
    3.49
    
    
    
    125,161
    
    
    
    3,442
    
    
    
    2.75Other borrowings (2)
    
    
    24,785
    
    
    
    1,086
    
    
    
    4.38
    
    
    
    6,729
    
    
    
    213
    
    
    
    3.17
    
    
    
    3,031
    
    
    
    25
    
    
    
    0.82Total interest-bearing
liabilities
    
    
    537,471
    
    
    
    21,214
    
    
    
    3.95
    
    
    
    426,897
    
    
    
    12,206
    
    
    
    2.86
    
    
    
    280,026
    
    
    
    5,913
    
    
    
    2.11Noninterest-bearing deposits
    
    
    104,763
    
    
    
    
    
    
    
    
    
    
    
    81,368
    
    
    
    
    
    
    
    
    
    
    
    49,385Noninterest-bearing liabilities
    
    
    4,532
    
    
    
    
    
    
    
    
    
    
    
    2,679
    
    
    
    
    
    
    
    
    
    
    
    1,995Stockholders equity
    
    
    60,168
    
    
    
    
    
    
    
    
    
    
    
    51,693
    
    
    
    
    
    
    
    
    
    
    
    31,999Total liabilities and
stockholders
equity
    
    $
    706,934
    
    
    
    
    
    
    
    
    
    
    $
    562,637
    
    
    
    
    
    
    
    
    
    
    $
    363,405Net interest income
    
    
    
    
    
    $
    24,673
    
    
    
    
    
    
    
    
    
    
    $
    17,076
    
    
    
    
    
    
    
    
    
    
    $
    10,742Interest-rate spread (3)
    
    
    
    
    
    
    
    
    
    
    2.81
    %
    
    
    
    
    
    
    
    
    
    
    2.68
    %
    
    
    
    
    
    
    
    
    
    
    2.81
    %Net interest margin (4)
    
    
    
    
    
    
    
    
    
    
    3.63
    %
    
    
    
    
    
    
    
    
    
    
    3.23
    %
    
    
    
    
    
    
    
    
    
    
    3.18
    %Ratio of average interest-
earning assets to average
interest-bearing
liabilities
    
    
    1.26
    
    
    
    
    
    
    
    
    
    
    
    1.24
    
    
    
    
    
    
    
    
    
    
    
    1.21
 
 (1)
    
    Includes Federal Home Loan Bank stock, Federal Funds sold and interest-earning
demand deposits.(2)
    
    Includes securities sold under agreement to repurchase and federal funds purchased
lines of credit.(3)
    
    Interest-rate spread represents the difference between the average yield on
interest-earning assets and the average rate of interest-bearing liabilities.(4)
    
    Net interest margin is net interest income divided by average interest-earning
assets. 25




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##### Table of Contents



Year Ended December 31, 2006 vs. 2005:
 Increase (Decrease) Due toRate/Rate
    
    
    Volume
    
    
    Volume
    
    
    Total(In thousands)Interest-earning assets:Loans
    
    $
    3,664
    
    
    $
    7,470
    
    
    $
    1,300
    
    
    $
    12,434Securities
    
    
    618
    
    
    
    2,234
    
    
    
    286
    
    
    
    3,138Other
    
    
    1,698
    
    
    
    (442
    )
    
    
    (223
    )
    
    
    1,033Total
    
    
    5,980
    
    
    
    9,262
    
    
    
    1,363
    
    
    
    16,605Interest-bearing liabilities:Deposits:Savings, NOW and money-market deposits
    
    
    1,926
    
    
    
    537
    
    
    
    224
    
    
    
    2,687Time deposits
    
    
    2,319
    
    
    
    2,382
    
    
    
    747
    
    
    
    5,448Borrowings
    
    
    82
    
    
    
    572
    
    
    
    219
    
    
    
    873Total
    
    
    4,327
    
    
    
    3,491
    
    
    
    1,190
    
    
    
    9,008Net change in net interest income
    
    $
    1,653
    
    
    $
    5,771
    
    
    $
    173
    
    
    $
    7,597
 Year Ended December 31, 2005 vs. 2004:
 Increase (Decrease) Due toRate/Rate
    
    
    Volume
    
    
    Volume
    
    
    Total(In thousands)Interest-earning assets:Loans
    
    $
    1,417
    
    
    $
    4,956
    
    
    $
    495
    
    
    $
    6,868Securities
    
    
    405
    
    
    
    2,253
    
    
    
    558
    
    
    
    3,216Other
    
    
    1,285
    
    
    
    490
    
    
    
    768
    
    
    
    2,543Total
    
    
    3,107
    
    
    
    7,699
    
    
    
    1,821
    
    
    
    12,627Interest-bearing liabilities:Deposits:Savings, NOW and money-market deposits
    
    
    907
    
    
    
    910
    
    
    
    337
    
    
    
    2,154Time deposits
    
    
    926
    
    
    
    2,383
    
    
    
    641
    
    
    
    3,950Borrowings
    
    
    71
    
    
    
    31
    
    
    
    87
    
    
    
    189Total
    
    
    1,904
    
    
    
    3,324
    
    
    
    1,065
    
    
    
    6,293Net change in net interest income
    
    $
    1,203
    
    
    $
    4,375
    
    
    $
    756
    
    
    $
    6,334
 26




---



##### Table of Contents



Comparison of Results of Operations for 2006 to 2005
 General
  Interest Income and Expense
    Provision for Loan Losses
  27




---



##### Table of Contents



Noninterest Income
  Noninterest Expense
  Income Taxes
  Comparison of Results of Operations for 2005 to 2004
 General
  Interest Income and Expense
    28




---



##### Table of Contents



Provision for Loan Losses
  Noninterest Income
  Noninterest Expense
  Income Taxes
  29




---



##### Table of Contents



Asset/Liability Management
      30




---



##### Table of Contents



31




---



##### Table of Contents



OverUnder 3
    
    
    3 to 12
    
    
    1-5
    
    
    FiveMonths
    
    
    Months
    
    
    Years
    
    
    Years
    
    
    TotalFederal funds sold
    
    $
    71,334
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    71,334Loans (1)
    
    
    278,492
    
    
    
    20,450
    
    
    
    87,806
    
    
    
    58,546
    
    
    
    445,294Securities (2)
    
    
    6,727
    
    
    
    20,182
    
    
    
    108,123
    
    
    
    68,394
    
    
    
    203,426Total rate-sensitive assets (earning assets)
    
    $
    356,553
    
    
    $
    40,632
    
    
    $
    195,929
    
    
    $
    126,940
    
    
    $
    720,054Money market (3)
    
    $
    140,242
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    140,242Savings and NOW deposits (3)
    
    
    4,343
    
    
    
    13,029
    
    
    
    69,489
    
    
    
    
    
    
    
    86,861Time deposits (3)
    
    
    20,160
    
    
    
    224,441
    
    
    
    82,910
    
    
    
    
    
    
    
    327,511Other borrowings
    
    
    22,503
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,503Total rate-sensitive liabilities
    
    $
    187,248
    
    
    $
    237,470
    
    
    $
    152,399
    
    
    $
    
    
    
    $
    577,117Gap (repricing differences)
    
    $
    169,305
    
    
    $
    (196,838
    )
    
    $
    43,530
    
    
    $
    126,940
    
    
    $
    142,937Cumulative Gap
    
    $
    169,305
    
    
    $
    (27,533
    )
    
    $
    15,997
    
    
    $
    142,937Cumulative GAP/total assets
    
    
    .23
    
    
    
    (.04
    )
    
    
    .02
    
    
    
    .19Cumulative GAP/total earning assets
    
    
    .25
    
    
    
    (.04
    )
    
    
    .02
    
    
    
    .21Total assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    750,712Total earning assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    679,195
 
 (1)
    
    In preparing the table above, adjustable-rate loans were included in the period
in which the interest rates are next scheduled to adjust rather than in the period in which
the loans mature. Fixed-rate loans were scheduled according to their contractual maturities.(2)
    
    Securities were scheduled based on their remaining maturity or repricing frequency.
Mortgage-backed securities are scheduled over ratably five years.(3)
    
    Excludes noninterest-bearing deposit accounts. Money market deposits were regarded
as maturing immediately. NOW and savings deposits were regarded as maturing in 1-5 years.
All other time deposits were scheduled through the maturity dates. 32




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##### Table of Contents



Financial Condition
 Lending Activities
    33




---



##### Table of Contents



At December 31,2006
    
    
    2005
    
    
    2004
    
    
    2003% of
    
    

    
    
    
    
    % of
    
    

    
    
    
    
% of
    
    
    
   
   
   
  % ofAmount
    
    
    Total
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    TotalCommercial, financial and agricultural
    
    $
    79,462
    
    
    
    18
    %
    
    $
    69,266
    
    
    
    19
    %
    
    $
    44,720
    
    
    
    18
    %
    
    $
    42,779
    
    
    
    21
    %Real estate-mortgage
    
    
    212,378
    
    
    
    48
    
    
    
    179,323
    
    
    
    49
    
    
    
    133,257
    
    
    
    54
    
    
    
    119,887
    
    
    
    60Construction and land development
    
    
    146,297
    
    
    
    33
    
    
    
    111,698
    
    
    
    31
    
    
    
    60,675
    
    
    
    25
    
    
    
    31,934
    
    
    
    16Installment and consumer lines
    
    
    7,157
    
    
    
    1
    
    
    
    5,349
    
    
    
    1
    
    
    
    5,998
    
    
    
    3
    
    
    
    6,754
    
    
    
    3Total loans
    
    $
    445,294
    
    
    
    100
    %
    
    $
    365,636
    
    
    
    100
    %
    
    $
    244,650
    
    
    
    100
    %
    
    $
    201,354
    
    
    
    100
    %Less: Allowance for loan losses
    
    
    (5,557
    )
    
    
    
    
    
    
    (4,580
    )
    
    
    
    
    
    
    (3,077
    )
    
    
    
    
    
    
    (2,526
    )Net deferred fees
    
    
    (652
    )
    
    
    
    
    
    
    (631
    )
    
    
    
    
    
    
    (359
    )
    
    
    
    
    
    
    (348
    )Loans, net
    
    $
    439,085
    
    
    
    
    
    
    $
    360,425
    
    
    
    
    
    
    $
    241,214
    
    
    
    
    
    
    $
    198,480
  1 Year
    
    
    1 Through
    
    
    Afteror Less
    
    
    5 Years
    
    
    5 Years
    
    
    TotalCommercial, financial and agricultural
    
    $
    52,834
    
    
    $
    24,732
    
    
    $
    1,896
    
    
    $
    79,462Real estate-mortgage
    
    
    73,087
    
    
    
    62,409
    
    
    
    76,882
    
    
    
    212,378Construction and land development
    
    
    91,283
    
    
    
    32,850
    
    
    
    22,164
    
    
    
    146,297Installment and consumer lines
    
    
    5,167
    
    
    
    1,946
    
    
    
    44
    
    
    
    7,157Total loans
    
    $
    222,371
    
    
    $
    121,937
    
    
    $
    100,986
    
    
    $
    445,294Loans with maturities over one year:Fixed rate
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    120,295Variable rate
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    102,628Total maturities greater than one year
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    222,923
 Asset Quality
   34




---



##### Table of Contents




    
    the loans market price; or
    
    the fair value of the loans collateral, less discounted
estimated costs to sell, if the collateral is expected to be the
sole source of repayment.
   
    
    The Company receives physical possession of a debtors assets
regardless of whether formal foreclosure proceedings have been
initiated or completed; or
    
    the debtor has effectively surrendered control of the underlying
collateral in contemplation of foreclosure.
  35




---



##### Table of Contents



At December 31,2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002Impaired loans with a
valuation allowance
    
    $
    49
    
    
    $
    44
    
    
    $
    83
    
    
    $
    376
    
    
    $
    Impaired loans without a
valuation allowance
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Less  valuation allowance
on impaired loans
    
    
    (6
    )
    
    
    (4
    )
    
    
    (5
    )
    
    
    (97
    )
    
    
    Total net impaired loans
    
    $
    43
    
    
    $
    40
    
    
    $
    78
    
    
    $
    279
    
    
    $
    
  Year Ended December 31,2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002Average net investment in
impaired loans
    
    $
    49
    
    
    $
    51
    
    
    $
    349
    
    
    $
    376
    
    
    $
    Interest income recognized
on impaired loans
    
    $
    1
    
    
    $
    1
    
    
    $
    3
    
    
    $
    
    
    
    $
    Interest income received on
impaired loans
    
    $
    1
    
    
    $
    1
    
    
    $
    3
    
    
    $
    
    
    
    $
    
 36




---



##### Table of Contents



At December 31,2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % ofTotal
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    TotalAmount
    
    
    Loans
    
    
    Amount
    
    
    Loans
    
    
    Amount
    
    
    Loans
    
    
    Amount
    
    
    Loans
    
    
    Amount
    
    
    Loans($in thousands)Loans on nonaccrual
status:Real estate loans
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %Commercial
    
    
    11
    
    
    
    
    
    
    
    44
    
    
    
    .01
    
    
    
    50
    
    
    
    .02
    
    
    
    491
    
    
    
    .24
    
    
    
    
    
    
    
    Consumer and home
equity loans
    
    
    38
    
    
    
    .01
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total loans on
nonaccrual status
    
    
    49
    
    
    
    .01
    
    
    
    44
    
    
    
    .01
    
    
    
    50
    
    
    
    .02
    
    
    
    491
    
    
    
    .24
    
    
    
    
    
    
    
    Accruing loans past due
90 days or more
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    44
    
    
    
    .02
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Troubled debt restructuring
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total nonperforming
loans
    
    
    49
    
    
    
    .01
    
    
    
    44
    
    
    
    .01
    
    
    
    94
    
    
    
    .04
    
    
    
    491
    
    
    
    .24
    
    
    
    
    
    
    
    Foreclosed assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total nonperforming
assets
    
    $
    49
    
    
    
    .01
    
    
    $
    44
    
    
    
    .01
    
    
    $
    94
    
    
    
    .04
    
    
    $
    491
    
    
    
    .24
    
    
    $
    
    
    
    
    As a percentage of total assets:Total nonperforming
loans
    
    
    
    
    
    
    .01
    %
    
    
    
    
    
    
    .01
    %
    
    
    
    
    
    
    .02
    %
    
    
    
    
    
    
    .15
    %
    
    
    
    
    
    
    N/ATotal nonperforming
assets
    
    
    
    
    
    
    .01
    %
    
    
    
    
    
    
    .01
    %
    
    
    
    
    
    
    .02
    %
    
    
    
    
    
    
    .15
    %
    
    
    
    
    
    
    N/AAllowance for loan losses as a
percentage of:Total loans
    
    
    
    
    
    
    1.25
    %
    
    
    
    
    
    
    1.25
    %
    
    
    
    
    
    
    1.26
    %
    
    
    
    
    
    
    1.25
    %
    
    
    
    
    
    
    1.25
    %Nonperforming loans
    
    
    
    
    
    
    11,340
    %
    
    
    
    
    
    
    10,409
    %
    
    
    
    
    
    
    3,273
    %
    
    
    
    
    
    
    514
    %
    
    
    
    
    
    
    N/A
  37




---



##### Table of Contents



Amount(In thousands)Interest income that would have been recorded
    
    $
    5Less: Interest income recognized
    
    
    1Interest income foregone
    
    $
    4
   Classification of Assets and Potential Problem Loans
 Foreclosed Assets.
 Classified Assets.
 38




---



##### Table of Contents



Special Mention
    
    
    SubstandardNumber
    
    
    Amount
    
    
    Number
    
    
    Amount($ in thousands)At December 31, 2006:Loans:Commercial, financial and agricultural
    
    
    3
    
    
    $
    110
    
    
    
    1
    
    
    $
    11Real estate mortgage
    
    
    2
    
    
    
    369
    
    
    
    
    
    
    
    Construction and land development
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Installment and consumer lines
    
    
    
    
    
    
    
    
    
    
    2
    
    
    
    385
    
    
    $
    479
    
    
    
    3
    
    
    $
    49Foreclosed assets
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
 39




---



##### Table of Contents



Allowance for Loan Losses
 See
  40




---



##### Table of Contents



Year Ended December 31,2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002Allowance at beginning of period
    
    $
    4,580
    
    
    $
    3,077
    
    
    $
    2,526
    
    
    $
    1,014
    
    
    $
    492Charge-offs:Commercial, financial and agricultural
    
    
    (1
    )
    
    
    (24
    )
    
    
    (88
    )
    
    
    (139
    )
    
    
    (21
    )Real estate mortgage
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (16
    )
    
    
    Installment and consumer lines
    
    
    
    
    
    
    (14
    )
    
    
    
    
    
    
    (5
    )
    
    
    Total charge-offs
    
    
    (1
    )
    
    
    (38
    )
    
    
    (88
    )
    
    
    (160
    )
    
    
    (21
    )Recoveries:Commercial, financial and agricultural
    
    
    4
    
    
    
    1
    
    
    
    22
    
    
    
    1
    
    
    
    Total recoveries
    
    
    4
    
    
    
    1
    
    
    
    22
    
    
    
    1
    
    
    
    Provision for loan losses charged to earnings
    
    
    974
    
    
    
    1,540
    
    
    
    617
    
    
    
    784
    
    
    
    543Acquired in purchase transaction
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    887
    
    
    
    Allowance at end of period
    
    $
    5,557
    
    
    $
    4,580
    
    
    $
    3,077
    
    
    $
    2,526
    
    
    $
    1,014Ratio of net charges-offs during the period to
average loans outstanding during the period
    
    
    
    %
    
    
    .01
    %
    
    
    .03
    %
    
    
    .09
    %
    
    
    .04
    %Allowance for loan losses as a percentage of
nonperforming loans
    
    
    11,340
    %
    
    
    10,409
    %
    
    
    3,273
    %
    
    
    514
    %
    
    
    N/AAllowance for loan losses as a percentage of
total gross loans
    
    
    1.25
    %
    
    
    1.25
    %
    
    
    1.26
    %
    
    
    1.25
    %
    
    
    1.25
    %
 41




---



##### Table of Contents



At December 31,2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % ofLoans to
    
    
    
    
    
    
    Loans to
    
    
    
    
    
    
    Loans to
    
    
    
    
    
    
    Loans to
    
    
    
    
    
    
    Loans toTotal
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    TotalAmount
    
    
    Loans
    
    
    Amount
    
    
    Loans
    
    
    Amount
    
    
    Total
    
    
    Amount
    
    
    Loans
    
    
    Amount
    
    
    LoansCommercial, financial and
agricultural
    
    $
    993
    
    
    
    18
    %
    
    $
    704
    
    
    
    19
    %
    
    $
    457
    
    
    
    18
    %
    
    $
    428
    
    
    
    21
    %
    
    $
    258
    
    
    
    31
    %Real estate mortgage
    
    
    2,651
    
    
    
    48
    
    
    
    1,538
    
    
    
    49
    
    
    
    1,212
    
    
    
    54
    
    
    
    1,091
    
    
    
    60
    
    
    
    348
    
    
    
    47Construction and land
development
    
    
    1,824
    
    
    
    33
    
    
    
    1,121
    
    
    
    31
    
    
    
    607
    
    
    
    25
    
    
    
    319
    
    
    
    16
    
    
    
    155
    
    
    
    19Installment and consumer lines
    
    
    89
    
    
    
    1
    
    
    
    53
    
    
    
    1
    
    
    
    69
    
    
    
    3
    
    
    
    78
    
    
    
    3
    
    
    
    22
    
    
    
    3Unallocated
    
    
    
    
    
    
    
    
    
    
    1,164
    
    
    
    
    
    
    
    732
    
    
    
    
    
    
    
    610
    
    
    
    
    
    
    
    231
    
    
    
    Total allowance for loan losses
    
    $
    5,557
    
    
    
    100
    %
    
    $
    4,580
    
    
    
    100
    %
    
    $
    3,077
    
    
    
    100
    %
    
    $
    2,526
    
    
    
    100
    %
    
    $
    1,014
    
    
    
    100
    %
 Investment Securities
  At December 31,2006
    
    
    2005
    
    
    2004Investment securities:Available-for-sale:U.S. Government agency obligations
    
    $
    17,757
    
    
    $
    15,743
    
    
    $
    3,512Mortgage-backed securities
    
    
    134,544
    
    
    
    148,307
    
    
    
    65,128Total
    
    $
    152,301
    
    
    $
    164,050
    
    
    $
    68,640Held-to-maturity:Municipal bonds
    
    $
    51,125
    
    
    $
    21,119
    
    
    $
    Federal funds sold
    
    $
    71,334
    
    
    $
    126,119
    
    
    $
    63,831Interest-earning demand deposits in other banks
    
    $
    
    
    
    $
    
    
    
    $
    9,857
 42




---



##### Table of Contents



After One Year
    
    
    After Five YearsOne Year or Less
    
    
    to Five Years
    
    
    to Ten Years
    
    
    After Ten Years
    
    
    TotalAmortized
    
    
    Average
    
    
    Amortized
    
    
    Average
    
    
    Amortized
    
    
    Average
    
    
    Amortized
    
    
    Average
    
    
    Amortized
    
    
    AverageCost
    
    
    Yield
    
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    YieldDecember 31, 2006:U.S. Government
agency securities
    
    $
    
    
    
    
    
    %
    
    $
    500
    
    
    
    3.1
    %
    
    $
    17,297
    
    
    
    4.7
    %
    
    $
    
    
    
    
    
    %
    
    $
    17,797
    
    
    
    4.6
    %Mortgage-backed
securities
    
    
    886
    
    
    
    4.7
    
    
    
    17,932
    
    
    
    4.0
    
    
    
    40,102
    
    
    
    4.4
    
    
    
    77,773
    
    
    
    4.4
    
    
    
    136,693
    
    
    
    4.4Municipal bonds
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    98
    
    
    
    3.9
    
    
    
    51,027
    
    
    
    4.2
    
    
    
    51,125
    
    
    
    4.2$
    886
    
    
    
    4.7
    %
    
    $
    18,432
    
    
    
    4.0
    %
    
    $
    57,497
    
    
    
    4.5
    %
    
    $
    128,800
    
    
    
    4.3
    %
    
    $
    205,615
    
    
    
    4.4
    %December 31, 2005:U.S. Government
agency securities
    
    $
    
    
    
    
    
    %
    
    $
    500
    
    
    
    3.1
    %
    
    $
    15,463
    
    
    
    3.9
    %
    
    $
    
    
    
    
    
    %
    
    $
    15,963
    
    
    
    3.8
    %Mortgage-backed
securities
    
    
    7,562
    
    
    
    4.2
    
    
    
    45,369
    
    
    
    4.2
    
    
    
    37,808
    
    
    
    4.2
    
    
    
    60,492
    
    
    
    4.2
    
    
    
    151,231
    
    
    
    4.2Municipal bonds
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21,119
    
    
    
    4.2
    
    
    
    21,119
    
    
    
    4.2$
    7,562
    
    
    
    4.2
    %
    
    $
    45,869
    
    
    
    4.2
    %
    
    $
    53,271
    
    
    
    4.1
    %
    
    $
    81,611
    
    
    
    4.2
    %
    
    $
    188,313
    
    
    
    4.0
    %December 31, 2004:U.S. Government
agency securities
    
    $
    
    
    
    
    
    %
    
    $
    500
    
    
    
    3.1
    %
    
    $
    3,018
    
    
    
    2.5
    %
    
    $
    
    
    
    
    
    %
    
    $
    3,518
    
    
    
    2.6
    %Mortgage-backed
securities
    
    
    
    
    
    
    
    
    
    
    17,329
    
    
    
    3.6
    
    
    
    21,648
    
    
    
    3.6
    
    
    
    26,573
    
    
    
    3.6
    
    
    
    65,550
    
    
    
    3.6$
    
    
    
    
    
    %
    
    $
    17,829
    
    
    
    3.6
    %
    
    $
    24,666
    
    
    
    3.5
    %
    
    $
    26,573
    
    
    
    3.6
    %
    
    $
    69,068
    
    
    
    3.5
    %
  43




---



##### Table of Contents



Deposit Activities
   See
 44




---



##### Table of Contents



At December 31,2006
    
    
    2005
    
    
    2004% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % ofAmount
    
    
    Deposits
    
    
    Amount
    
    
    Deposits
    
    
    Amount
    
    
    DepositsNoninterest-bearing demand deposits
    
    $
    103,169
    
    
    
    16
    %
    
    $
    98,082
    
    
    
    16
    %
    
    $
    52,472
    
    
    
    14
    %Savings and NOW deposits
    
    
    86,861
    
    
    
    13
    
    
    
    55,614
    
    
    
    9
    
    
    
    35,620
    
    
    
    10Money-market deposits
    
    
    140,242
    
    
    
    21
    
    
    
    217,281
    
    
    
    35
    
    
    
    131,131
    
    
    
    36Subtotal
    
    
    330,272
    
    
    
    50
    
    
    
    370,977
    
    
    
    60
    
    
    
    219,223
    
    
    
    60Time deposits:1.00% - 1.99%
    
    
    
    
    
    
    
    
    
    
    656
    
    
    
    1
    
    
    
    5,289
    
    
    
    12.00% - 2.99%
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    70,069
    
    
    
    193.00% - 3.99%
    
    
    27
    
    
    
    
    
    
    
    117,657
    
    
    
    19
    
    
    
    57,002
    
    
    
    164.00% - 4.99%
    
    
    87,591
    
    
    
    13
    
    
    
    127,246
    
    
    
    20
    
    
    
    14,059
    
    
    
    45.00% - 5.99%
    
    
    239,893
    
    
    
    37
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total time deposits (1)
    
    
    327,511
    
    
    
    50
    
    
    
    245,559
    
    
    
    40
    
    
    
    146,419
    
    
    
    40Total deposits
    
    $
    657,783
    
    
    
    100
    %
    
    $
    616,536
    
    
    
    100
    %
    
    $
    365,642
    
    
    
    100
    %
 
 (1)
    
    Including individual retirement accounts (IRAs) of $9,887, $10,958 and $8,695
at December 31, 2006, 2005 and 2004, respectively.  Year Ended December 31,2006
    
    
    2005
    
    
    2004Average
    
    
    Average
    
    
    Average
    
    
    Average
    
    
    Average
    
    
    AverageBalance
    
    
    Rate
    
    
    Balance
    
    
    Rate
    
    
    Balance
    
    
    RateMoney-market deposits
    
    $
    163,747
    
    
    
    3.28
    %
    
    $
    161,514
    
    
    
    2.42
    %
    
    $
    110,302
    
    
    
    1.84
    %Savings and NOW deposits
    
    
    68,868
    
    
    
    2.77
    
    
    
    46,822
    
    
    
    1.48
    
    
    
    41,532
    
    
    
    1.00Time deposits
    
    
    280,071
    
    
    
    4.58
    
    
    
    211,832
    
    
    
    3.49
    
    
    
    125,161
    
    
    
    2.75Total interest-bearing deposits
    
    $
    512,686
    
    
    
    3.93
    %
    
    $
    420,168
    
    
    
    2.85
    %
    
    $
    276,995
    
    
    
    2.13
    %
 45




---



##### Table of Contents



Due
    
    
    Due
    
    
    DueUnder Three
    
    
    3 Months to
    
    
    1 Year toMonths
    
    
    12 Months
    
    
    5 Years
    
    
    Total3.00% - 3.99%
    
    $
    27
    
    
    $
    
    
    
    $
    
    
    
    $
    274.00% - 4.99%
    
    
    20,132
    
    
    
    41,268
    
    
    
    26,190
    
    
    
    87,5905.00% - 5.99%
    
    
    
    
    
    
    183,174
    
    
    
    56,720
    
    
    
    239,894Total time deposits
    
    $
    20,159
    
    
    $
    224,442
    
    
    $
    82,910
    
    
    $
    327,511
  At December 31,2006
    
    
    2005
    
    
    2004Due in three months or less
    
    $
    26,201
    
    
    $
    14,544
    
    
    $
    9,310Due from three months to one year
    
    
    158,559
    
    
    
    55,925
    
    
    
    27,432Due from twelve months to five years
    
    
    63,718
    
    
    
    113,551
    
    
    
    56,992$
    248,478
    
    
    $
    184,020
    
    
    $
    93,734
 46




---



##### Table of Contents



Borrowings
  At or For the Year EndedDecember 31,2006
    
    2005
    
    2004Balance at year-end
    
    $
    22,503
    
    
    $
    31,884
    
    
    $
    2,009Average balance during the year
    
    $
    24,785
    
    
    $
    6,707
    
    
    $
    3,019Interest expense during the year
    
    $
    1,085
    
    
    $
    212
    
    
    $
    25Average interest rate during the year
    
    
    4.38
    %
    
    
    3.16
    %
    
    
    .83
    %
  Selected Quarterly Results
 2006
    
    2005Fourth
    
    Third
    
    Second
    
    First
    
    Fourth
    
    Third
    
    Second
    
    FirstQuarter
    
    Quarter
    
    Quarter
    
    Quarter
    
    Quarter
    
    Quarter
    
    Quarter
    
    Quarter(In thousands, except per share amounts)Interest income
    
    $
    12,341
    
    
    $
    11,938
    
    
    $
    11,277
    
    
    $
    10,331
    
    
    $
    9,411
    
    
    $
    8,067
    
    
    $
    6,497
    
    
    $
    5,307Interest expense
    
    
    6,184
    
    
    
    5,610
    
    
    
    5,064
    
    
    
    4,356
    
    
    
    3,936
    
    
    
    3,443
    
    
    
    2,741
    
    
    
    2,086Net interest income
    
    
    6,157
    
    
    
    6,328
    
    
    
    6,213
    
    
    
    5,975
    
    
    
    5,475
    
    
    
    4,624
    
    
    
    3,756
    
    
    
    3,221Provision for loan
losses
    
    
    357
    
    
    
    223
    
    
    
    95
    
    
    
    299
    
    
    
    378
    
    
    
    485
    
    
    
    491
    
    
    
    186Noninterest income
    
    
    331
    
    
    
    264
    
    
    
    258
    
    
    
    233
    
    
    
    221
    
    
    
    218
    
    
    
    205
    
    
    
    157Noninterest expense
    
    
    3,740
    
    
    
    3,278
    
    
    
    3,256
    
    
    
    3,215
    
    
    
    3,069
    
    
    
    2,934
    
    
    
    2,736
    
    
    
    2,334Earnings before
income taxes
    
    
    2,391
    
    
    
    3,091
    
    
    
    3,120
    
    
    
    2,694
    
    
    
    2,249
    
    
    
    1,423
    
    
    
    734
    
    
    
    858Net earnings
    
    
    1,616
    
    
    
    2,014
    
    
    
    2,000
    
    
    
    1,714
    
    
    
    1,455
    
    
    
    898
    
    
    
    456
    
    
    
    526Basic earnings per
common share
    
    
    .32
    
    
    
    .41
    
    
    
    .41
    
    
    
    .35
    
    
    
    .31
    
    
    
    .19
    
    
    
    .09
    
    
    
    .15Diluted earning per
common share
    
    
    .25
    
    
    
    .40
    
    
    
    .40
    
    
    
    .34
    
    
    
    .30
    
    
    
    .18
    
    
    
    .09
    
    
    
    .15
 47




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##### Table of Contents



Impact of Inflation and Changing Prices
  
 Item 7A. Quantitative and Qualitative Disclosures About Market Risk
    
 Item 8. Financial Statements and Supplementary Data
  
 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
   48




---



##### Table of Contents



Item 9A. Controls and Procedures
 (a)
    
    Evaluation of disclosure controls and procedures. The Company
maintains controls and procedures designed to ensure that information required to be
disclosed in the reports that the Company files or submits under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported within the time
periods specified in the rules and forms of the Securities and Exchange Commission.
Based upon their evaluation of those controls and procedures performed within 90 days
of the filing date of this report, the Chief Executive and Chief Financial officers of
the Company concluded that the Companys disclosure controls and procedures were
adequate.(b)
    
    Changes in internal controls. The Company made no significant changes
in its internal controls or in other factors that could significantly affect these
controls subsequent to the date of the evaluation of those controls by the Chief
Executive and Chief Financial officers.
 
 Item 9B. Other Information
  
 PART III
 
 Item 10. Directors, Executive Officers, Promoters and Corporate Governance
 Directors
  James Hewitt,
 Randy Burden,
 Vincent Hughes,
 49




---



##### Table of Contents



Michael Hattaway
 David Powers,
 Executive Officers
  Shirley Tyler,
 Audit Committee Report
     
 
 50




---



##### Table of Contents



Code of Ethics
  Section 16(A) Reporting Requirements
  
 Item 11. Executive Compensation
 Compensation Discussion and Analysis
  Definition of Executive Officers:
 Objectives of the Compensation Plan:
      51




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##### Table of Contents




    
    Financial performance relative to budget plan.
    
    Performance relative to strategic business plan as adopted by the Board.
    
    Direct contribution to the overall financial success of the Company.
    
    Extraordinary performance relative to key business opportunities.
    
    Performance contribution relative to regulatory performance of the Company.
    
    Performance relative to assigned objectives.
    
    Performance of unit under management of the associate.
   Elements of the Compensation Plan:
 
    
    Salary: The Company pays wages that are within the peer group range of comparable
institutions for the job description of the executive. This peer group information is
obtained through surveys produced by the trade associations of the Company as well as a
review of public filings from comparable peer companies. Executive officers are
included in the same overall employee benefit plan provide to each associate of the
Company and its subsidiary. The Company utilizes the services of a
Professional Employment Organization. Benefits are
provided by the PEO and are not unique to the Company or its executive officers.
Executive Officers are reviewed annually by the Compensation Committee of the Board of
Directors. The Compensation Committee establishes ranges for salary compensation
adjustments.
    
    Stock Options: The Company has previously awarded stock options to certain key
associates, including Executive Officers. These stock option awards are defined under
the Officer and Employee Stock Option Plan adopted by the Company and approved by is
shareholders. Among other objectives, the granting of stock options provides for the
retention of key staff members, the recruitment of identified employee candidates, and
the incentive for financial overachievement as defined elsewhere within this analysis.
    
    Bonus Payments: The Employee Compensation Plan provides for a range of bonus
payments based upon the financial performance of the Company relative to budget plan.
Other factors also impact the distribution of any payment. The Company believes that
the
 52




---



##### Table of Contents



primary element of merit compensation should be directed towards incentive compensation
versus salary compensation. This philosophy serves to maintain wage cost.
    
    401-K: The Company provides, through its PEO, access to a 401-K plan. The plan is
not specific to the Company. The Company does not have a formal matching program in
place. Associates are encouraged to participate in the plan. The Company, based upon
its financial performance, may consider a lump sum contribution to the plan. The
approval of such contribution is made through the Compensation Committee and presented
to the Board of Directors for approval. The Company has made a contribution to the
plan in 3 of the prior 6 years.
    
    Salary Continuation Agreement: The Company has adopted a Salary Continuation Plan
for its Executive Officers. The purpose of the Plan is to provide specified benefits
to the Executives who contribute materially to the continued growth, development and
future business success of the Company. The agreement is unfunded for tax purposes and
for purposes of Title I of the Employee Retirement Income Security Act of 1974, as
amended from time to time.
    
    Employment Agreements: The Company has entered into employment agreements with its
Executive Officers. Among other factors, these agreements contain non-competition,
non-solicitation and non-interference requirements by the executive in favor of the
Company. The agreements also provide for a change of control payment to the
executive in the event that the Company sells or is merged whereby 51% of the existing
shareholders no longer represent the majority ownership.
    
    Reimbursement of Expenses: The Company provides its executive officers with
reimbursement for business related expenses, civic and charitable association
membership dues, membership dues in business clubs and organizations that benefit the
business development opportunities of the Company. The Company also provides an auto
allowance, in lieu of mileage reimbursement or Company owned vehicles, to the executive
officers.
  Role of the executive officers in the Compensation Decisions:
 Compensation is related to performance:
 Incentive Compensation should represent a large portion of the executives total compensation:
 53




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##### Table of Contents







Employment
Agreements:




SUMMARY COMPENSATION TABLE


Non-Equity
    
    Change inIncentive
    
    PensionName and
    
    
    
    
    
    
    
    
    
    
    
    
    
    Block
    
    
    
    
    
    Plan
    
    Value and
    
    All OtherPrincipal
    
    
    
    
    
    
    
    
    
    
    
    
    
    Awards
    
    Option
    
    Compen-
    
    Nonqualified
    
    Compen-Position
    
    Year
    
    Salary ($)
    
    Bonus ($)
    
    ($)
    
    Awards ($)
    
    sation ($)
    
    ($)
    
    sation ($)
    
    Total ($)David G. Powers
President and Chief
Executive Officer
of the Holding
Corporation and the
Bank
    
    
    2006
    
    
    $
    290,010
    
    
    $
    90,000
    
    
    
    
    
    
    $
    4,750
    (1)
    
    
    
    
    
    $
    15,507
    
    
    $
    12,101
    
    
    $
    412,368Shirley L. Tyler
Executive Vice
President and
Treasurer
    
    
    2006
    
    
    $
    115,756
    
    
    $
    50,000
    
    
    
    
    
    
    $
    950
    (2)
    
    
    
    
    
    $
    7,206
    
    
    $
    10,592
    
    
    $
    184,514





|    |  |                                   
|--- |  | ----------------------------------
|(1) |  | 1,000 options at $4.75 per option.
|   
|(2) |  | 200 options at $4.75 per option.  

Executive
Employment Agreements






Payment as a Result
    
    Payment as a ResultExecutive
    
    of Early Termination
    
    of Change in ControlDavid G. Powers
    
    $
    870,000
    
    
    $
    2,620,000Shirley L. Tyler
    
    $
    115,000
    
    
    $
    659,000


54



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##### Table of Contents



GRANTS OF PLAN  BASED AWARDS IN FISCAL 2006
 Exerciseor BasePayouts
    
    
    
    
    
    Future
    
    Payouts
    
    All
    
    All
    
    Price ofEstimated
    
    Future
    
    Incentive
    
    Estimated
    
    Equity
    
    Incentive
    
    Other
    
    Other
    
    OptionUnder
    
    Nonequity
    
    Awards
    
    Under
    
    Awards
    
    Plan
    
    Stock
    
    Option
    
    AwardsGrant
    
    Threshold
    
    Plan
    
    Maximum
    
    Threshold
    
    Target
    
    Maximum
    
    Awards
    
    Awards
    
    (Price/Sh)Name
    
    Date
    
    ($)
    
    Target ($)
    
    ($)
    
    (#)
    
    (#)
    
    (#)
    
    (#)
    
    (#)
    
    ($) (1)David G. Powers
    
    
    1/3/2006
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    5,000
    
    
    $
    15.00Shirley L. Tyler
    
    
    1/3/2006
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    1,000
    
    
    $
    15.00
 
 (1)
    
    Closing price on date of grant $15.00 OUTSTANDING EQUITY AWARDS AT DECEMBER 31, 2006
EXECUTIVE OFFICERS
 Option Awards
    
    Stock AwardsEquityEquity
    
    IncentiveMarket
    
    Incentive
    
    PlanValue
    
    Plan
    
    Awards;of
    
    Awards;
    
    MarketShares
    
    Number
    
    or PayoutEquity
    
    
    
    
    
    
    
    
    
    
    
    
    
    Number
    
    or
    
    of
    
    Value ofIncentive
    
    
    
    
    
    
    
    
    
    
    
    
    
    of
    
    Units
    
    Unearned
    
    UnearnedPlan Awards
    
    
    
    
    
    
    
    
    
    
    
    
    
    Shares
    
    of
    
    Shares,
    
    Shares,Number of
    
    Number of
    
    Number of
    
    
    
    
    
    
    
    
    
    
    
    
    
    or Units
    
    Stock
    
    Units or
    
    Units orSecurities
    
    Securities
    
    Securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    of Stock
    
    that
    
    Other
    
    OtherUnderlying
    
    Underlying
    
    Underlying
    
    
    
    
    
    
    
    
    
    
    
    
    
    that
    
    have
    
    Rights
    
    RightsUnexercised
    
    Unexercised
    
    Unexercised
    
    Option
    
    Option
    
    Option
    
    have not
    
    not
    
    that have
    
    that haveOptions (#)
    
    Options (#)
    
    Earned
    
    Exercise
    
    Exercised
    
    Expiration
    
    vested
    
    vested
    
    not vested
    
    not vestedName
    
    Exercisable
    
    Unexercisable
    
    Options (#)
    
    Price ($)
    
    Price ($)
    
    Date
    
    (#)
    
    ($)
    
    (#)
    
    ($)David G. Powers
    
    
    12,346
    
    
    
    0
    
    
    
    0
    
    
    $
    12
    
    
    
    0
    
    
    
    4/1/201427,000
    
    
    $
    10
    
    
    
    0
    
    
    
    3/29/201110,000
    
    
    $
    14
    
    
    
    0
    
    
    
    12/30/201410,000
    
    
    $
    14
    
    
    
    0
    
    
    
    4/1/20155,000
    
    
    $
    15
    
    
    
    0
    
    
    
    1/3/2016Shirley L. Tyler
    
    
    
    
    
    
    
    
    
    
    20,000
    
    
    $
    10
    
    
    
    0
    
    
    
    3/29/20115,000
    
    
    $
    14
    
    
    
    0
    
    
    
    12/30/20143,000
    
    
    $
    14
    
    
    
    0
    
    
    
    4/18/20151,000
    
    
    $
    15
    
    
    
    0
    
    
    
    1/3/2016
 PENSION BENEFITS
EXECUTIVE OFFICERS
 Present Value ofNumber of Years
    
    Accumulated
    
    Payments DuringName
    
    Plan Name
    
    Credited Service (#)
    
    Benefit ($)
    
    Last Fiscal Year ($)David G. Powers
    
    Salary Continuation Plan
    
    3 months
    
    $
    15,507
    
    
    
    0Shirley L. Tyler
    
    Salary Continuation Plan
    
    3 months
    
    $
    7,206
    
    
    
    0
 Director Compensation
    DIRECTOR COMPENSATION
 Change inPension ValueFees
    
    
    
    
    
    
    
    
    
    
    
    
    
    andEarned
    
    
    
    
    
    
    
    
    
    Nonequity
    
    Nonqualifiedor Paid-
    
    Stock
    
    Option
    
    Incentive Plan
    
    Deferred
    
    All OtherIn Cash
    
    Awards
    
    Awards
    
    Compensation
    
    Compensation
    
    Compen-Name
    
    Year
    
    ($)
    
    ($)
    
    ($)
    
    ($)
    
    Earnings
    
    sation ($)
    
    Total ($)Randy O. Burden
    
    
    2006
    
    
    $
    30,000
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    $
    30,000J. Michael Hattaway
    
    
    2006
    
    
    $
    31,450
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    $
    31,450James L. Hewitt
    
    
    2006
    
    
    $
    113,000
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    $
    113,000Vincent S. Hughes
    
    
    2006
    
    
    $
    31,000
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    $
    31,000David G. Powers
    
    
    2006
    
    
    $
    13,000
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    $
    13,000
 55




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##### Table of Contents



Compensation
Committee Interlocks and Insider Participation
  Compensation
Committee Report
  THE
COMPENSATION COMMITTEE
 
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
 EQUITY COMPENSATION PLAN INFORMATION
 Number of SecuritiesRemaining Available forFuture Issuance UnderNumber of Securities to
    
    Weighted-Average
    
    Equity Compensationbe issued upon exercise of
    
    Exercise Price of
    
    Plans (ExcludingOutstanding Options,
    
    Outstanding Options
    
    Securities Reflected inPlan Category
    
    Warrants and Rights
    
    Warrants and Rights
    
    Column)Equity compensation
plans approved by
security holders
    
    
    560,177
    
    
    $
    12.20
    
    
    
    111,148Equity compensation
plans not approved
by security holders
    
    
    
    
    
    $
    
    
    
    
    0Total
    
    
    560,177
    
    
    $
    12.20
    
    
    
    111,148
  Amount and Nature of BeneficialName of Beneficial Owner
    
    Ownership
    
    Percent of Class5% or More of Outstanding StockN/A
    
    
    N/A
    
    
    
    N/ADirector and Executive Officer
OwnershipRandy O. Burden
    
    
    214,353
    
    
    
    4.24
    %Michael J. Hattaway
    
    
    214,353
    
    
    
    4.24
    %(1)James L. Hewitt
    
    
    215,000
    
    
    
    4.25
    %Vincent S. Hughes
    
    
    91,646
    
    
    
    1.81
    %(2)David G. Powers
    
    
    87,370
    
    
    
    1.73
    %(3)Shirley Tyler
    
    
    41,650
    
    
    
    0.82
    %(4)All Directors and Executive
Officers as a group (6 persons)
    
    
    864,372
    
    
    
    17.10
    %
 
 (1)
    
    Includes 24,566 presently exercisable options and 161,510 shares held by a family trust.(2)
    
    Includes 54,300 shares held by a revocable trust.(3)
    
    Includes 50,346 presently exercisable options and 15,000 shares held by his IRA.(4)
    
    Includes 24,400 presently exercisable options and 2,500 shares held by her IRA. 56




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##### Table of Contents



Item 13. Certain Relationships and Related Transactions and Director Independence
 Certain Transactions
  Director Independence
  57




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##### Table of Contents



Item 14. Principal Accountant Fees and Services
  2006
    
    
    2005Audit fees
    
    $
    67,000
    
    
    
    64,725Audit related fees
    
    
    
    
    
    
    Tax fees
    
    
    5,000
    
    
    
    5,025Subtotal
    
    
    72,000
    
    
    
    69,750All other fees
    
    
    
    
    
    
    Total fees
    
    $
    72,000
    
    
    
    69,750
  Services Provided by Hacker, Johnson & Smith, PA
  1)
    
    Audit Fees  These are fees for professional services perform for the audit of
the Companys annual financial statements and review of financial
statements included in the Companys 10-Q filings, and services that are
normally provided in connection with statutory and regulatory filings or engagements.2)
    
    Audit-Related Fees  These are fees for assurance and related services
performed that are reasonably related to the performance of the audit or review of the
Companys financial statements. No such services were performed by Hacker,
Johnson & Smith, PA in 2006.3)
    
    Tax Fees  These are fees for professional services performed by Hacker,
Johnson & Smith, PA with respect to tax compliance, tax advice and tax planning. This
includes preparation of original and amended tax returns for the
Company
and its consolidated subsidiary; refund claims; payment planning; tax audit assistance;
and tax work stemming from Audit-Related items.4)
    
    All Other Fees  These are fees for other permissible work performed that does not meet the above category descriptions. No such
services were performed in 2006
or 2005.
 58




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##### Table of Contents



Item 15. Exhibits and Financial Statements Schedules
 3.1
    
    
    -
    
    Articles of Incorporation of United Heritage Bankshares of Florida, Inc. **3.2
    
    
    -
    
    Bylaws of United Heritage Bankshares of Florida, Inc. ****4.1
    
    
    -
    
    Specimen Stock Certificate of United Heritage Bankshares of Florida, Inc. **10.1
    
    
    -
    
    Employment Agreement, dated as of March 15, 2004, amended September 21,
2006, between United Heritage Bank and David G. Powers *****10.2
    
    
    -
    
    United Heritage Bankshares of Florida, Inc. Directors Stock Option Plan *10.3
    
    
    -
    
    United Heritage Bankshares of Florida, Inc.s Officers and Employees Stock
Option Plan *10.4
    
    
    -
    
    Employment Agreement, dated as of March 15, 2004, amended September 21,
2006, between United Heritage Bank and Shirley L. Tyler *****13.1
    
    
    -
    
    Financial Statements of United Heritage Bankshares of Florida, Inc. and
Subsidiary14.1
    
    
    -
    
    Code of Ethics *21.1
    
    
    -
    
    List of Subsidiaries of United Heritage Bankshares of Florida, Inc.23.1
    
    
    -
    
    Consent of Hacker, Johnson & Smith PA31.1
    
    
    -
    
    Certification of Chief Executive Officer required by Rule
13a-14(a)/15d-14(a) under the Exchange Act31.2
    
    
    -
    
    Certification of Chief Financial Officer required by Rule
13a-14(a)/15d-14(a) under the Exchange Act32.1
    
    
    -
    
    Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    -
    
    Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Incorporated by reference to the corresponding exhibit number in the Companys Form 10-KSB
filed for the year ended December 31, 2003. 59




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##### Table of Contents



**
    
    Incorporated by reference to the corresponding exhibit number in the Companys Form 10-QSB
filed for the quarter ended March 31, 2003.***
    
    Incorporated by reference to the corresponding exhibit number in the Companys Form 10-QSB
filed for the quarter ended March 31, 2004.****
    
    Incorporated by reference to the corresponding exhibit number in the Companys Form 10-QSB
filed for the quarter ended June 30, 2004.******
    
    Incorporated by reference in the Companys Form 8-K filed September 25, 2006. 60




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##### Table of Contents



SIGNATURES
  UNITED HERITAGE BANKSHARES OF FLORIDA, INC./s/ David G. PowersPresident and Chief Executive Officer/s/ Shirley L. TylerExecutive Vice President and Treasurer
 61




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##### Table of Contents



Signature
    
    Title/s/ James L. Hewitt

James L. Hewitt
    
    Director/s/ David G. Powers

David G. Powers
    
    Director/s/ J. Michael Hattaway

J. Michael Hattaway
    
    Director/s/ Vincent S. Hughes

Vincent S. Hughes
    
    Director/s/ Randy O. Burden

Randy O. Burden
    
    Director
 62




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNo.
    
    Exhibit13.1
    
    Financial Statements of United Heritage Bankshares of Florida, Inc. and Subsidiary21.1
    
    Subsidiaries of the Registrant23.1
    
    Consent of Hacker, Johnson & Smith PA31.1
    
    Certification of President and Chief Executive Officer under §302 of the Sarbanes-Oxley Act
of 200231.2
    
    Certification of Executive Vice President and Treasurer under §302 of the Sarbanes-Oxley Act
of 200232.1
    
    Certification of President and Chief Executive Officer under §906 of the Sarbanes-Oxley Act
of 200232.2
    
    Certification of Executive Vice President and Treasurer under §906 of the Sarbanes-Oxley Act
of 2002
 63