**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION****WASHINGTON, D.C. 20549****_______________________________________________**

**FORM 10-QSB**

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

For the quarterly period ended December 31, 2000

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

For the transition period from ____________ to _____________.



******COMMUNITY FINANCIAL CORPORATION**

---

|Virginia                                                       |  | 54-1532044                          
|-------------------------------------------------------------- |  | ------------------------------------
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)

|38 North Central Ave., Staunton, VA      |  | 24401     
|---------------------------------------- |  | ----------
|(Address of principal executive offices) |  | (Zip Code)

Issuer's telephone number, including area code: (540) 886-0796

Number of shares of Common Stock, par value $.01 per share, outstanding at the close of business on February 6, 2001:  2,367,339.

Transitional Small business Disclosure Format (check one): Yes [  ] No [X]

|PART I.  | FINANCIAL INFORMATION                                                                                        |  
|-------- | ------------------------------------------------------------------------------------------------------------ | -
|Item 1.  | Consolidated Financial Statements                                                                            |  
|         | Consolidated Statements of Financial Conditionat December 31, 2000 (unaudited) and March 31, 2000            | 1
|         | Consolidated Statements of Income for theThree  and Nine Months Ended December 31, 2000 and 1999 (unaudited) | 2
|         | Consolidated Statements of Cash Flows for theNine Months Ended December 31, 2000 and1999 (unaudited)         | 3
|         | Notes to Unaudited Interim ConsolidatedFinancial Statements                                                  | 4
|Item 2.  | Management's Discussion and Analysis of FinancialCondition and Results of Operations                         | 5
|PART II. | OTHER INFORMATION                                                                                            | 8

|                                                                                                                                                               | December 31,2000(Unaudited) | March 31,2000
|-------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------- | -------------
|ASSETS                                                                                                                                                         |                             |              
|Cash (including interest bearing  deposits of approximately  $1,978,000 and $1,908,000)                                                                        | $  6,086,221                | $  7,424,577 
|Securities                                                                                                                                                     |                             |              
|Held to maturity                                                                                                                                               | 30,965,769                  | 27,312,943   
|Available for sale                                                                                                                                             | 8,448,290                   | 6,863,674    
|Investment in Federal Home Loan  Bank stock, at cost                                                                                                           | 2,700,000                   | 1,950,000    
|Loans receivable, net                                                                                                                                          | 205,191,318                 | 189,700,859  
|Real estate owned                                                                                                                                              | 348,049                     | 823,002      
|Property and equipment, net                                                                                                                                    | 6,254,157                   | 6,627,869    
|Accrued interest receivable                                                                                                                                    |                             |              
|Loans                                                                                                                                                          | 1,315,692                   | 1,145,835    
|Investments                                                                                                                                                    | 594,327                     | 142,277      
|Prepaid expenses and other assets                                                                                                                              | 879,922                     | 1,086,330    
|                                                                                                                                                               |                             |              
|                                                                                                                                                               |                             |              
|Total Assets                                                                                                                                                   | $262,783,745                | $243,077,366 
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                                                           |                             |              
|                                                                                                                                                               |                             |              
|LIABILITIES                                                                                                                                                    |                             |              
|Deposits                                                                                                                                                       | $170,241,048                | $158,568,275 
|Advances from Federal Home Loan Bank                                                                                                                           | 47,000,000                  | 37,000,000   
|Securities sold under agreement to Repurchase                                                                                                                  | 17,000,000                  | 20,000,000   
|Advance payments by borrowers for taxes and insurance                                                                                                          | 204,704                     | 226,195      
|Other liabilities                                                                                                                                              | 2,546,044                   | 1,888,821    
|Total Liabilities                                                                                                                                              | 236,991,796                 | 217,683,291  
|STOCKHOLDERS' EQUITY                                                                                                                                           |                             |              
|Preferred stock, $.01 par value, authorized     3,000,000 shares, none outstanding                                                                             |                             |              
|Common stock, $.01 par value, authorized     10,000,000 shares, 2,384,339 and     2,511,526 shares issued and outstanding    at
December 31 and March 31, 2000 | 23,843                      | 25,115       
|Additional paid in capital                                                                                                                                     | 4,567,914                   | 4,782,029    
|Retained earnings                                                                                                                                              | 19,031,828                  | 19,401,019   
|Net unrealized gains on securities available for sale                                                                                                          | 2,168,364                   | 1,185,912    
|Total Stockholders' Equity                                                                                                                                     | 25,791,949                  | 25,394,075   
|                                                                                                                                                               |                             |              
|Total Liabilities and Stockholders' Equity                                                                                                                     | $262,783,745                | $243,077,366 

See accompanying notes to consolidated financial statements.

|                                                     | Three MonthsEnded December 31, | Nine MonthsEnded December 31,
|---------------------------------------------------- | ------------------------------ | -----------------------------
|                                                     | 2000                           | 1999                         
|                                                     | (Unaudited)                    | (Unaudited)                  
|INTEREST INCOME                                      |                                |                              
|Loans                                                | $4,468,569                     | $3,812,512                   
|Investment securities                                | 638,770                        | 592,399                      
|Other                                                | 42,761                         | 27,768                       
|Total interest income                                | 5,150,100                      | 4,432,679                    
|INTEREST EXPENSE                                     |                                |                              
|Deposits                                             | 2,029,387                      | 1,604,337                    
|Borrowed money                                       | 1,086,765                      | 806,555                      
|Total interest expense                               | 3,116,152                      | 2,410,892                    
|NET INTEREST INCOME                                  | 2,033,948                      | 2,021,787                    
|PROVISION FOR LOAN LOSSES                            | 40,815                         | 122,408                      
|NET INTEREST INCOME AFTER  PROVISION FOR LOAN LOSSES | 1,993,133                      | 1,899,379                    
|NONINTEREST INCOME                                   |                                |                              
|Service charges, fees and commissions                | 681,588                        | 893,061                      
|Gain on sale of securities                           | ---                            | ---                          
|Miscellaneous                                        | 23,941                         | 42,056                       
|Total noninterest income                             | 705,529                        | 935,117                      
|NONINTEREST EXPENSE                                  |                                |                              
|Compensation & benefits                              | 1,060,684                      | 1,085,324                    
|Occupancy                                            | 318,133                        | 325,744                      
|Data processing                                      | 205,826                        | 146,771                      
|Federal insurance premium                            | 7,986                          | 21,489                       
|Miscellaneous                                        | 594,025                        | 639,318                      
|Total noninterest expense                            | 2,186,654                      | 2,218,646                    
|INCOME BEFORE TAXES                                  | 512,008                        | 615,850                      
|INCOME TAXES                                         | 180,619                        | 185,477                      
|NET INCOME                                           | $  331,389                     | $  430,373                   
|BASIC EARNINGS PER SHARE                             | $  .14                         | $  .17                       
|DILUTED EARNINGS PER SHARE                           | $  .14                         | $  .17                       
|DIVIDENDS PER SHARE                                  | $  .08                         | $  .08                       

See accompanying notes to consolidated financial statements.

|                                                                                     | Nine Months EndedDecember 31,
|------------------------------------------------------------------------------------ | -----------------------------
|                                                                                     | 2000                         
|                                                                                     | (Unaudited)                  
|OPERATING ACTIVITIES                                                                 |                              
|Net income                                                                           | $1,169,469                   
|Adjustments to reconcile net income to     net cash provided by operating activities |                              
|Provision for loan losses                                                            | 207,225                      
|Depreciation                                                                         | 556,129                      
|Amortization of premium and accretion        of discount on securities, net          | (29,768)                     
|(Decrease) in net deferred loan fees                                                 | (1,453)                      
|Increase in deferred income taxes                                                    | 125,922                      
|(Increase) in other assets                                                           | (412,499)                    
|Increase (decrease) other liabilities                                                | (92,338)                     
|(Gain) on sale of loans                                                              | (371,280)                    
|Proceeds from sale of loans                                                          | 31,308,073                   
|Loans originated for resale                                                          | (28,311,502)                 
|Gain on sale of available for sale securities                                        | ---                          
|Net cash provided (absorbed) by operating activities                                 | 4,147,978                    
|INVESTING ACTIVITIES                                                                 |                              
|Proceeds from maturities of held to maturity securities                              | 985,000                      
|Proceeds from sale of available for sale securities                                  | ---                          
|Purchase of investment securities                                                    | (4,649,827)                  
|Net (Increase) in loans                                                              | (18,261,864)                 
|Purchases of property and equipment                                                  | (203,323)                    
|(Purchase) of FHLB stock                                                             | (750,000)                    
|Decrease (increase) in Real Estate Owned                                             | 474,953                      
|Net cash provided (absorbed) by investing activities                                 | (22,405,061)                 
|FINANCING ACTIVITIES                                                                 |                              
|Dividends paid                                                                       | (590,715)                    
|Net increase (decrease) in deposits                                                  | 11,672,773                   
|Proceeds from advances and other borrowed money                                      | 329,000,000                  
|Repayments of advances and other borrowed money                                      | (322,000,000)                
|Proceeds from issuance of common stock                                               | 39,000                       
|Repurchase of common stock                                                           | (1,202,331)                  
|Net cash provided (absorbed) by financing activities                                 | 16,918,727                   
|NET (DECREASE) IN CASH AND CASH EQUIVALENTS                                          | (1,338,356)                  
|CASH AND CASH EQUIVALENTS-beginning of period                                        | 7,424,577                    
|CASH AND CASH EQUIVALENTS-end of period                                              | $6,086,221                   

See accompanying notes to consolidated financial statements.

NOTE 1. - BASIS OF PRESENTATION

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and
Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

The accompanying consolidated financial statements include the accounts of Community Financial Corporation ("Community" or the "Company"), its wholly-owned subsidiary, Community Bank (the "Bank") and Community First Mortgage
Corporation, a wholly-owned subsidiary of the Bank ("First Mortgage").  All significant intercompany balances and transactions have been eliminated in consolidation.

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation have been included.  Operating results for the three and nine months ended December 31, 2000, are not
necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2001.

NOTE 2. - EARNINGS PER SHARE

Basic earnings per share is based on net income divided by the weighted average
number of common shares outstanding during the period.  Diluted earnings per
share shows the dilutive effect of additional common shares issuable under stock
option plans.  Diluted earnings per share is computed by dividing net earnings by the weighted average number of common shares and common share equivalents outstanding.

|                                         | For the Three Months Ended
|---------------------------------------- | --------------------------
|                                         | December 31, 2000         
|                                         | Income                    
|Basic EPS                                |                           
|Income available to  common stockholders | $331,389                  
|Effect of Dilutive  Securities           |                           
|Options                                  | ---                       
|Diluted EPS                              |                           
|Income available to  common stockholders | $331,389                  

|                                         | For the Nine Months Ended
|---------------------------------------- | -------------------------
|                                         | December 31, 2000        
|                                         | Income                   
|Basic EPS                                |                          
|Income available to  common stockholders | $1,169,469               
|Effect of Dilutive  Securities           |                          
|Options                                  | ---                      
|Diluted EPS                              |                          
|Income available to  common stockholders | $1,169,469               

NOTE 3. - STOCKHOLDERS' EQUITY

The following table presents the Bank's regulatory capital levels at December 31, 2000:

|                   | AmountRequired | PercentRequired | ActualAmount | ActualPercent | ExcessAmount
|------------------ | -------------- | --------------- | ------------ | ------------- | ------------
|                   |                |                 |              |               |             
|Tangible Capital   | $ 3,920,000    | 1.50%           | $23,080,000  | 8.76%         | $19,160,000 
|Core Capital       | 10,452,000     | 4.00            | 23,080,000   | 8.76          | 12,628,000  
|Risk-based Capital | 14,933,000     | 8.00            | 26,037,000   | 13.95         | 11,104,000  

Capital distributions by OTS-regulated savings banks are limited by regulation ("Capital
Distribution Regulation").  Capital distributions are defined to include, in part,
dividends, stock repurchases and cash-out mergers.  The Capital Distribution Regulation
permits a savings bank to make capital distributions during a calendar year
equal to net income for the current year plus the previous two years net income, less
capital distributions paid over the same period.  Any distributions in excess of that
amount requires prior OTS approval.  The Capital Distribution Regulation requires that
savings banks in holding company structures provide the applicable OTS Regional Director with a 30-day advance written
notice of all proposed capital distributions whether or not advance approval is required
by the regulation.  The OTS may object to capital distributions if the bank is not meeting its regulatory capital requirements, the distribution raises safety and soundness concerns or is otherwise in violation of law.

NOTE 4. - SUPPLEMENTAL INFORMATION - STATEMENT OF CASH FLOWS

Total interest paid for the three months ended December 31, 2000 and 1999 was
$3,091,337 and $2,310,699, respectively. Total interest paid for the nine months
ended December 31, 2000 and 1999 was $8,895,333 and $5,582,318.  Total income
taxes paid for the three months ended December 31, 2000 and 1999 was $17,148
and $230,583. Total income taxes paid for the nine months ended December 31, 2000
and 1999 was $374,566 and $972,751.

NOTE 5. - COMPREHENSIVE INCOME

Comprehensive income is defined as "the change in equity (net assets) of a
business enterprise during a period from transactions and other events and
circumstances from non-owner sources. It includes all changes in equity during
a period except those resulting from investments by owners and distributions
to owners." Comprehensive income for the Company includes net income and
unrealized gains and losses on securities available for sale. The following
tables set forth the components of comprehensive income for the three and nine-month periods ended December 31, 2000 and 1999:

|                                                                                                                                                             | Three Months Ended December 31
|------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------
|                                                                                                                                                             | 2000                          
|(Amounts in thousands)                                                                                                                                       |                               
|Net income                                                                                                                                                   | $  331,389                    
|Other comprehensive income,  net of tax    Unrealized gains (losses) on securities:      Unrealized holding gains (losses)   
     arising during the period | 678,256                       
|Less:  Reclassification        adjustment for (gains) losses        included in net income                                                                   | ---                           
|                                                                                                                                                             | $1,009,645                    

|                                                                                                                                                             | Nine Months Ended December 31
|------------------------------------------------------------------------------------------------------------------------------------------------------------ | -----------------------------
|                                                                                                                                                             | 2000                         
|Net income                                                                                                                                                   | $1,169,469                   
|Other comprehensive income,  net of tax    Unrealized gains (losses) on securities:      Unrealized holding gains (losses)   
     arising during the period | 982,452                      
|Less:  Reclassification        adjustment for (gains) losses        included in net income                                                                   | ---                          
|                                                                                                                                                             | $2,151,921                   

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

FINANCIAL CONDITION

The Company's total assets increased $19.7 million to $262.8 million at December 31, 2000, due primarily to an increase in loans receivable of $15.5 million which
was funded with both increases in deposits and advances from the Federal Home
Loan Bank of Atlanta. Deposits increased $11.7 millon to $170.2 million at
December 31, 2000, from $158.6 million at March 31, 2000. The increase in
deposits was due primarily to an increase in time deposits. Stockholders' equity
increased to $25.8 million at December 31, 2000, from $25.4 million at March 31,
2000, due primarily to earnings for the nine month period ended December 31, 2000
and an increase in the net unrealized gain on securities available for sale which
was partially offset by the Company's common  stock repurchase of $1.2 million and
the payment of our cash dividends of $591,000.

At December 31, 2000, non-performing assets totaled approximately $971,000
or .37% of assets compared to $1.3 million or .52% of assets at March 31, 2000.
Non-performing assets at December 31, 2000 were comprised primarily of
nonaccrual residential real estate 90 days or more delinquent. At December 31,
2000 our allowance for loan losses to non-performing assets was 144% and to total
assets was .53%. Based on current market values of the properties securing these
loans and current national and local economic conditions, management does not anticipate any significant losses in excess of the reserves
for losses previously recorded.

As of December 31, 2000, there were also $3.8 million in loans with respect to
which known information about the possible credit problems of the borrowers or the cash flows of the security properties have caused management to have doubts as to the ability of the borrowers to comply with present loan repayment terms and which may
result in the future inclusion of such items in the non-performing asset categories. These loans are comprised primarily of commercial and residential real estate loans.  Included in the commercial real estate loans of
concern is one loan in the amount of $1.3 million, which is current as to
interest and principal payments.

We maintain an allowance for loan losses to provide for estimated potential losses in our loan portfolio.  Management determines the level of reserves based on loan performance, the value of the collateral, economic and market
conditions, and previous experience.  Management reviews the adequacy of the allowance at least quarterly, utilizing its internal loan classification system.  Management believes that the loan loss reserve of $1.4 million is adequate at December 31, 2000.
 Although management believes it uses the best information available, future adjustments to reserves may be necessary.

LIQUIDITY

Historically, the Bank has maintained its liquid assets above the minimum requirements imposed by federal regulations and at a level believed adequate to meet requirements of normal daily activities, repayment of maturing debt and
potential deposit outflows. As of December 31,2000 the Bank's liquidity
ratio (liquid assets as a percentage of net withdrawable savings and current
borrowings) was 8.06%, which exceeds the current 4% regulatory requirement.

At December 31, 2000, we had commitments to purchase or originate $22.9 million
of loans. Certificates of deposit scheduled to mature in one year or less at
December 31, 2000, totaled $64.1 million. Based on our historical experience,
management believes that a significant portion of such deposits will remain with
us. Management further believes that loan repayments and other sources of funds
will be adequate to meet our foreseeable short-term and long-term liquidity needs.

RESULTS OF OPERATIONS

Three Months Ended December 31, 2000 and 1999.

General.  Net income for the three months ended December 31, 2000 was $331,000
compared to $430,000 for the three months ended December 31, 1999. Net interest
income increased $12,000 while non-interest income decreased $230,000 during the
three months ended December 31, 2000 compared to the same period in 1999. Income
before taxes decreased to $512,000 for the three months ended December 31, 2000
from $616,000 for the three months ended December 31, 1999.

Interest Income.   Total interest income increased to $5.2 million for the three months ended December 31, 2000, from $4.4 million for the three months
ended December 31, 1999, due primarily to increases in both the average balance
of investment securities and loans for the three months ended December 31, 2000
as compared to the period ended December 31,1999.  The average yield earned on
interest-earning assets was 8.10% for the three months ended December 31, 2000
compared to 7.89% for the three months ended December 31, 1999.

Interest Expense.  Total interest expense increased to $3.1 million for the quarter ended December 31, 2000, from $2.4 million for the quarter ended
December 31, 1999. Interest on deposits increased to $2.0 million for the
quarter ended December 31, 2000 from $1.6 million for the quarter ended
December 31, 1999 due to increases in both the cost of deposits and the average outstanding deposit balances. The average rate paid on deposits for the three
months ended December 31, 1999 increased from 4.18% to 4.77% for the same period
in the current year. Interest expense on borrowed money increased to $1.1 million
for the quarter ended December 31, 2000, from $807,000 for the quarter ended
December 31, 1999, due to an increase in average outstanding borrowings and an
increase in the average rate paid.  The average rate paid on interest-bearing
liabilities was 5.30% during the three months ended December 31, 2000 compared
to 4.55% for the three months ended December 31, 1999.

Provision for Loan Losses.  The provision for loan losses decreased to $41,000
for the three months ended December 31, 2000, from $122,000 for the three months
ended December 31, 1999.

Noninterest Income.  Noninterest income decreased to $706,000 for the three
months ended December 31, 2000, from $935,000 for the three months ended December 31, 1999 due primarily to a decrease in fees and gains on the sale of mortgage loans in the secondary market by our subsidiary, Community First Mortgage Corporation during
the December 31, 2000 quarter.

Noninterest Expenses.  Noninterest expense decreased by $32,000 to $2.2 million
for the three months ended December 31, 2000 compared to the same period last
year. Data processing expense increased during the December 31, 2000 quarter
compared to the December 31, 1999 quarter due to depreciation on purchases of additional
equipment and increased electronic processing volumes.  The decrease in miscellaneous expenses for the December 31, 2000 quarter compared to the December 31, 1999 was due primarily to a decrease in mortgage origination related expenses in the Company's
mortgage subsidiary offset by $251,000 of non-recurring charges related to the Bank's conversion of its data processing system.

Taxes.  Taxes decreased to $181,000 for the three months ended December 31, 2000, from $185,000 for the three months ended December 31, 1999.  The effective
tax rate increased to 35% for the December 31, 2000 quarter from 30% for the December 31, 1999 quarter.

Nine Months Ended December 31, 2000 and 1999

General.  Net income for the nine months ended December 31, 2000 decreased to
$1.2 million compared to $1.3 million for the nine months ended December 31, l999 due
primarily to gains on sale of securities in the December 31, 1999 nine month period. Income before income taxes decreased to $1.8 million
for the nine months ended December 31, 2000 from $2.2 million for the same period
in the prior year.

Interest Income.  Total interest income increased to $14.8 million for the nine
months ended December 31, 2000, from $11.9 million for the nine months ended
December 31, 1999, due primarily to an increase in the average balance of loans
and investment securities outstanding during the period. The yield on loans and
securities increased from 8.02% to 8.20% for the same periods.

Interest Expense.  Total interest expense increased to $8.9 million for the nine
months ended December 31, 2000, from $6.2 million for the nine months ended
December 31, 1999.  Interest on deposits increased to $5.6 million for the nine
months ended December 31, 2000, from $4.7 million for the same period last year
due to increases in both the average outstanding deposit and borrowings balances and the rate
paid. The rate paid on deposits increased from 4.21% for the nine months ended
December 31, 1999 to 4.83% for the same period in the current fiscal year.
Interest expense on borrowed money increased to $3.3 million for the nine months
ended December 31, 2000 from $1.5 million for the nine months ended December 31,
1999, due to increases in both average borrowings and the rate paid.

Provision for Loan Losses.  The provision for loan losses decreased to $207,000
for the nine months ended December 31, 2000, from $302,000 for the same period
last year.

Noninterest Income.  Noninterest income decreased to $2.2 million for the nine
months ended December 31, 2000, from $2.9 million for the nine months ended
December 31, 1999, due primarily to a decrease in gain on sale of securities.

Noninterest Expenses.  Noninterest expenses increased $39,000 for the nine months
ended December 31, 2000, compared to the same period last year. Data processing
expense increased during the December 31, 2000 nine month period due to depreciation on purchases
of equipment and an additional branch location.  The decrease in miscellaneous expenses for the nine months ended December 31, 2000 compared to the same period ended December 31, 1999 was due primarily to a decrease in mortgage origination related
expenses in the Company's mortgage subsidiary offset by $251,000 of non-recurring charges related to the Bank's conversion of its data processing system.

Taxes.  Taxes decreased to $630,000 for the three months ended December 31, 2000, from $853,000 for the nine months ended December 31, 1999.  The effective
tax rate decreased from 39% for the December 31, 1999 period to 35% for the same
period ended December 31, 2000 due primarily to an increase in interest income from tax
advantaged securities.

Disclosure Regarding Forward-Looking Statements

This document, including information incorporated by reference, and future filings by Community on Form 10-KSB, Form 10-QSB
and Form 8-K and future oral and written statements by Community and its management may contain, forward-looking statements about the
corporation and its subsidiaries which we believe are within the meaning of the
Private Securities Litigation Reform Act of 1995.  These forward-looking
statements include, without limitation, statements with respect to anticipated
future operating and financial performance, growth opportunities, interest rates,
cost savings and funding advantages expected or anticipated to be realized by
management.  Words such as "may," "could," "should," "would," "believe,"
"anticipate," "estimate," "expect," "intend," "plan" and similar expressions are
intended to identify these forward-looking statements.  Forward-looking
statements by Community and its management are based on
beliefs, plans, objectives, goals, expectations, anticipations, estimates and
intentions of management and are not guarantees of future performance.  Community
disclaims any obligation to update or revise any forward-looking statements based on the

occurrence of future events, the receipt of new
information, or otherwise.  The important factors we discuss below and elsewhere
in this document, as well as other factors discussed under the caption
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" in this document and identified in our filings with the SEC and those
presented elsewhere by our management from time to time, could cause actual
results to differ materially from those indicated by the forward-looking
statements made in this document:

The following factors, many of which are subject to change based on various
other factors beyond our control, could cause our financial performance to differ
materially from the plans, objectives, expectations, estimates and intentions
expressed in such forward-looking statements:

- the strength of the United States economy in general and the strength
of the local economies in which we conduct our operations;
- the effects of, and changes in, trade, monetary and fiscal policies and
laws, including interest rate policies of the Federal Reserve Board;
- inflation, interest rate, market and monetary fluctuations;
- the timely development of and acceptance of new products and services
of Community Bank and the perceived overall value of these products and
services by users, including the features, pricing and quality compared
to competitors' products and services;
- the willingness of users to substitute competitors' products and
services for our products and services;
- the success of Community Bank in gaining regulatory approval of its
products and services, when required;
- the impact of changes in financial services' laws and regulations
(including laws concerning taxes, banking, securities and insurance);
- the impact of  technological changes;
- acquisitions;
- changes in consumer spending and saving habits; and
- our success at managing the risks involved in the foregoing.

Item 1.  Legal Proceedings

Not Applicable.

Item 2.  Changes in Securities

Not Applicable.

Item 3.  Defaults Upon Senior Securities

Not Applicable.

Item 4.  Submission of Matters to a Vote of Security Holders

Not Applicable.

Item 5.  Other Information

Not Applicable.

Item 6.  Exhibits and Reports on Form 8-K

a.  Exhibits:   None

b.  Reports on Form 8-K:   None

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

|                         | COMMUNITY FINANCIAL CORPORATION                                                      
|------------------------ | -------------------------------------------------------------------------------------
|Date:  February 14, 2001 | By:  /s/ R. Jerry GilesR. Jerry GilesChief Financial Officer(Duly Authorized Officer)