----

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| Oconee                    Financial                    Corporation                   |
|--------------------------------------------------------------------------------------|
| (Name                    of Small Business Issuer in                    its Charter) |

| Georgia                                                                                                                                 |   | 58-2442250                                                                  |
|-----------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------|
| (State                  or Other Jurisdiction                  of Incorporation                  or                  Organization) |   | (I.R.S.                  Employer Identification                  No.) |

| 35                    North Main Street,                    Watkinsville, Georgia 30677-0205                             |
|--------------------------------------------------------------------------------------------------------------------------|
| (Address                    of Principal Executive                    Offices)   (Zip                    Code) |

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ITEM          7.     FINANCIAL          STATEMENTS.

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|                                                                        |   | 2006   |        | 2005   |   |
|-----------------------------------------------------------------------------|--------|--------|-------------|--------|--------|
|  Assets                                                                |   |   |        |   |   |
|                                                                        |   |   |        |   |   |
| Cash                    and due from banks, including reserve               |   |   |        |   |   |   |   |
| requirements                    of $25,000 and $3,106,000                   |   | $      | 4,753,988   |   |   | 7,955,659 |   |
| Federal                    funds sold                                       |   |   | 10,324,000  |   |   | 11,109,000 |   |
|                                                                        |   |   |        |   |   |   |   |
| Cash                    and cash equivalents                                |   |   | 15,077,988  |   |   | 19,064,659 |   |
|                                                                        |   |   |        |   |   |   |   |
| Investment                    securities available for sale                 |   |   | 92,372,246  |   |   | 51,333,740 |   |
| Other                    investments                                        |   |   | 670,329     |   |   | 614,429 |   |
| Mortgage                    loans held for sale                             |   |   | 1,976,000   |   |   | 1,285,000 |   |
| Loans,                    net                                               |   |   | 214,806,748 |   |   | 203,528,341 |   |
| Premises                    and equipment, net                              |   |   | 6,458,527   |   |   | 5,819,466 |   |
| Accrued                    interest receivable and other assets             |   |   | 5,146,240   |   |   | 3,419,553 |   |
|                                                                        |   |   |        |   |   |   |   |
|                                                                        |   | $      | 336,508,078 |   |   | 285,065,188 |   |
|                                                                        |   |   |        |   |   |   |   |
|  Liabilities                    and Stockholders’ Equity         |   |   |        |   |   |   |   |
|                                                                        |   |   |        |   |   |   |   |
| Deposits:                                                                   |   |   |        |   |   |   |   |
| Demand                                                            |   | $      | 33,688,316  |   |   | 32,757,455 |   |
| Interest-bearing                    demand                                  |   |   | 75,527,885  |   |   | 64,504,808 |   |
| Savings                                                                     |   |   | 44,174,005  |   |   | 51,511,966 |   |
| Time                                                                        |   |   | 150,604,745 |   |   | 108,024,795 |   |
|                                                                        |   |   |        |   |   |   |   |
| Total                    deposits                                           |   |   | 303,994,951 |   |   | 256,799,024 |   |
|                                                                        |   |   |        |   |   |   |   |
| Securities                    sold under repurchase agreements              |   |   | 3,159,575   |   |   | 2,244,232 |   |
| Accrued                    interest payable and other liabilities           |   |   | 2,640,376   |   |   | 2,287,826 |   |
|                                                                        |   |   |        |   |   |   |   |
| Total                    liabilities                                        |   |   | 309,794,902 |   |   | 261,331,082 |   |
|                                                                        |   |   |        |   |   |   |   |
| Stockholders’                    equity:                              |   |   |        |   |   |   |   |
| Common                    stock, par value $2, authorized 1,500,000 shares, |   |   |        |   |   |   |   |
| issued                    and outstanding 899,815 shares                    |   |   | 1,799,630   |   |   | 1,799,630 |   |
| Additional                    paid-in capital                          |   |   | 4,243,332   |   |   | 4,243,332 |   |
| Retained                    earnings                                        |   |   | 20,693,448  |   |   | 17,857,970 |   |
| Accumulated                    other comprehensive loss                     |   |   | (23,234     | )      |   | (166,826 | ) |
|                                                                        |   |   |        |   |   |   |   |
| Total                    stockholders’ equity                         |   |   | 26,713,176  |   |   | 23,734,106 |   |
|                                                                        |   |   |        |   |   |   |   |
|                                                                        |   | $      | 336,508,078 |   |   | 285,065,188 |   |
|                                                                        |   |   |        |   |   |   |   |
|                                                                        |   |   |        |   |   |   |   |

----

|                                                                   |   | 2006   |       | 2005   |   | 2004       |   |
|------------------------------------------------------------------------|--------|--------|------------|--------|--------|------------|--------|
| Interest                    income:                                    |   |   |       |   |   |       |   |
| Interest                    and fees on loans                     |   | $      | 17,193,786 |   |   | 13,925,648 |   |   | 11,509,253 |   |
| Interest                    on federal funds sold                      |   |   | 631,201    |   |   | 342,585    |   |   | 100,011 |   |
| Interest                    and dividends on securities:               |   |   |       |   |   |       |   |   |   |   |
| U.                    S. government agencies                           |   |   | 1,708,908  |   |   | 1,154,080  |   |   | 1,165,597 |   |
| State,                    county and municipal                         |   |   | 884,178    |   |   | 801,772    |   |   | 801,396 |   |
| Other                                                                  |   |   | 113,611    |   |   | 117,679    |   |   | 109,441 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Total                    interest income                               |   |   | 20,531,684 |   |   | 16,341,764 |   |   | 13,685,698 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Interest                    expense:                                   |   |   |       |   |   |       |   |   |   |   |
| Interest-bearing                    demand deposits                    |   |   | 1,391,965  |   |   | 871,368    |   |   | 615,260 |   |
| Savings                    deposits                                    |   |   | 1,386,897  |   |   | 1,235,106  |   |   | 911,977 |   |
| Time                    deposits                                       |   |   | 5,487,621  |   |   | 3,080,559  |   |   | 2,132,542 |   |
| Other                                                                  |   |   | 66,732     |   |   | 43,419     |   |   | 23,328 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Total                    interest expense                              |   |   | 8,333,215  |   |   | 5,230,452  |   |   | 3,683,107 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Net                    interest income                                 |   |   | 12,198,469 |   |   | 11,111,312 |   |   | 10,002,591 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Provision                    for loan losses                           |   |   | 200,000    |   |   | 612,000    |   |   | 394,200 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Net                    interest income after provision for loan losses |   |   | 11,998,469 |   |   | 10,499,312 |   |   | 9,608,391 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Other                    income:                                       |   |   |       |   |   |       |   |   |   |   |
| Service                    charges                                     |   |   | 1,452,266  |   |   | 1,588,053  |   |   | 1,036,863 |   |
| Gain                    (loss) on sale of securities                   |   |   | (10,605    | )      |   | 7,019      |   |   | 46,798 |   |
| Gain                    (loss) on sale of other real estate owned      |   |   | 366,513    |   |   | (4,805     | )      |   | 1,291 |   |
| Gain                    on sale and disposal of premises and equipment |   |   | 62,959     |   |   | 6,010      |   |   | 196,621 |   |
| Mortgage                    origination fee income                     |   |   | 377,086    |   |   | 402,905    |   |   | 438,030 |   |
| Miscellaneous                                                          |   |   | 597,440    |   |   | 508,842    |   |   | 498,909 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Total                    other income                                  |   |   | 2,845,659  |   |   | 2,508,024  |   |   | 2,218,512 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Other                    expenses:                                     |   |   |       |   |   |       |   |   |   |   |
| Salaries                    and employee benefits                      |   |   | 5,616,459  |   |   | 5,187,641  |   |   | 4,840,367 |   |
| Occupancy                                                    |   |   | 1,258,032  |   |   | 1,333,568  |   |   | 1,279,339 |   |
| Other                    operating                                     |   |   | 2,169,951  |   |   | 2,083,798  |   |   | 2,162,228 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Total                    other expenses                                |   |   | 9,044,442  |   |   | 8,605,007  |   |   | 8,281,934 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Earnings                    before income taxes                        |   |   | 5,799,686  |   |   | 4,402,329  |   |   | 3,544,969 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Income                    tax expense                                  |   |   | 1,839,439  |   |   | 1,346,790  |   |   | 1,014,433 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Net                    earnings                                   |   | $      | 3,960,247  |   |   | 3,055,539  |   |   | 2,530,536 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |
| Net                    earnings per share                              |   | $      | 4.40       |   |   | 3.40       |   |   | 2.81 |   |
|                                                                   |   |   |       |   |   |       |   |   |   |   |

----

|                                                                                |   | 2006   |      | 2005   |   | 2004      |   |
|-------------------------------------------------------------------------------------|--------|--------|-----------|--------|--------|-----------|--------|
|                                                                                |   |   |      |   |   |      |   |
| Net                    earnings                                                     |   | $      | 3,960,247 |   |   | 3,055,539 |   |   | 2,530,536 |   |
|                                                                                |   |   |      |   |   |      |   |   |   |   |
| Other                    comprehensive (loss) income, net of income taxes:     |   |   |      |   |   |      |   |   |   |   |
| Unrealized                    gains on securities available for sale:               |   |   |      |   |   |      |   |   |   |   |
| Holding                    gains (losses) arising during period, net of tax         |   |   |      |   |   |      |   |   |   |   |
| benefit                    (expense) of $(83,832), $403,047 and $12,359             |   |   | 137,013   |   |   | (658,722  | )      |   | (20,199 | ) |
| Reclassification                    adjustment for (gains) losses included in net   |   |   |      |   |   |      |   |   |   |   |
| earnings,                    net of (benefit) tax of $4,026, $(2,664) and $(17,765) |   |   | 6,579     |   |   | (4,355    | )      |   | (29,033 | ) |
|                                                                                |   |   |      |   |   |      |   |   |   |   |
| Total                    other comprehensive (loss) income                          |   |   | 143,592   |   |   | (663,077  | )      |   | (49,232 | ) |
|                                                                                |   |   |      |   |   |      |   |   |   |   |
| Comprehensive                    income                                             |   | $      | 4,103,839 |   |   | 2,392,462 |   |   | 2,481,304 |   |
|                                                                                |   |   |      |   |   |      |   |   |   |   |
|                                                                                |   |   |      |   |   |      |   |   |   |   |

----

|                                                    |   |                                         |      | Additional                               |   |           |   | AccumulatedOther                 |       |        |   |
|---------------------------------------------------------|--------|----------------------------------------------|-----------|------------------------------------------|--------|----------------|--------|----------------------------------|------------|-------------|--------|
|                                                    |   | Common                                       |      | Paid-In                                  |   | Retained       |   | Comprehensive                    |       |        |   |
|                                                    |   |                      Stock    |      |                      Capital   |   |  Earnings |   | Income                    (Loss) |       |  Total |   |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |
| Balance,                    December 31, 2003           |   | $                                            | 1,799,770 |                                     |   | 4,246,832      |   |                             | 14,161,577 |        |   | 545,483 |   |   | 20,753,662 |   |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Cash                    dividends declared              |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| ($1.00                    per share)                    |   |                                         | -         |                                     |   | -              |   |                             | (899,885   | )           |   | - |   |   | (899,885 | ) |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Change                    in net unrealized gain (loss) |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| on                    investment securities available   |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| for                    sale, net of tax                 |   |                                         | -         |                                     |   | -              |   |                             | -          |        |   | (49,232 | ) |   | (49,232 | ) |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Net                    earnings                         |   |                                         | -         |                                     |   | -              |   |                             | 2,530,536  |        |   | - |   |   | 2,530,536 |   |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Balance,                    December 31, 2004           |   |                                         | 1,799,770 |                                     |   | 4,246,832      |   |                             | 15,792,228 |        |   | 496,251 |   |   | 22,335,081 |   |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Purchase                    and retirement of stock     |   |                                         | (140      | )                                        |   | (3,500         | )      |                             | -          |        |   | - |   |   | (3,640 | ) |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Cash                    dividends declared              |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| ($1.10                    per share)                    |   |                                         | -         |                                     |   | -              |   |                             | (989,797   | )           |   | - |   |   | (989,797 | ) |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Change                    in net unrealized gain (loss) |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| on                    investment securities available   |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| for                    sale, net of tax                 |   |                                         | -         |                                     |   | -              |   |                             | -          |        |   | (663,077 | ) |   | (663,077 | ) |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Net                    earnings                         |   |                                         | -         |                                     |   | -              |   |                             | 3,055,539  |        |   | - |   |   | 3,055,539 |   |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Balance,                    December 31, 2005           |   |                                         | 1,799,630 |                                     |   | 4,243,332      |   |                             | 17,857,970 |        |   | (166,826 | ) |   | 23,734,106 |   |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Cash                    dividends declared              |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| ($1.25                    per share)                    |   |                                         | -         |                                     |   | -              |   |                             | (1,124,769 | )           |   | - |   |   | (1,124,769 | ) |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Change                    in net unrealized gain (loss) |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| on                    investment securities available   |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| for                    sale, net of tax                 |   |                                         | -         |                                     |   | -              |   |                             | -          |        |   | 143,592 |   |   | 143,592 |   |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Net                    earnings                         |   |                                         | -         |                                     |   | -              |   |                             | 3,960,247  |        |   | - |   |   | 3,960,247 |   |
|                                                    |   |                                         |      |                                     |   |           |   |                             |       |        |   |   |   |   |   |   |
| Balance,                    December 31, 2006           |   | $                                            | 1,799,630 |                                     |   | 4,243,332      |   |                             | 20,693,448 |        |   | (23,234 | ) |   | 26,713,176 |   |

----

|                                                                           |   | 2006   |        | 2005   |   | 2004        |   |
|--------------------------------------------------------------------------------|--------|--------|-------------|--------|--------|-------------|--------|
| Cash                    flows from operating activities:                       |   |   |        |   |   |        |   |   |   |   |
| Net                    earnings                                           |   | $      | 3,960,247   |   |   | 3,055,539   |   |   | 2,530,536 |   |
| Adjustments                    to reconcile net earnings to net                |   |   |        |   |   |        |   |   |   |   |
| cash                    provided by operating activities:                      |   |   |        |   |   |        |   |   |   |   |
| Depreciation,                    amortization and accretion                    |   |   | 603,398     |   |   | 709,607     |   |   | 839,060 |   |
| Provision                    for loan losses                                   |   |   | 200,000     |   |   | 612,000     |   |   | 394,200 |   |
| Provision                    for deferred taxes                                |   |   | 79,663      |   |   | (110,503    | )      |   | 264,600 |   |
| (Gain)                    Loss on sale of investment securities                |   |   | 10,605      |   |   | (7,019      | )      |   | (46,798 | ) |
| (Gain)                    Loss on sale and disposal of fixed assets            |   |   | (62,959     | )      |   | 6,010       |   |   | (196,621 | ) |
| (Gain)                    Loss on sale of other real estate                    |   |   | (366,513    | )      |   | (4,805      | )      |   | 1,291 |   |
| Change                    in:                                                  |   |   |        |   |   |        |   |   |   |   |
| Accrued                    interest receivable and other assets                |   |   | (2,066,314  | )      |   | (278,477    | )      |   | (740,569 | ) |
| Accrued                    interest payable and other liabilities              |   |   | 352,550     |   |   | 700,292     |   |   | (96,154 | ) |
| Mortgage                    loans originated and held for sale                 |   |   | (691,000    | )      |   | (157,300    | )      |   | 2,035,271 |   |
|                                                                           |   |   |        |   |   |        |   |   |   |   |
| Net                    cash provided by operating activities                   |   |   | 2,019,677   |   |   | 4,525,344   |   |   | 4,984,816 |   |
|                                                                           |   |   |        |   |   |        |   |   |   |   |
| Cash                    flows from investing activities:                       |   |   |        |   |   |        |   |   |   |   |
| Purchase                    of investment securities available for sale        |   |   | (53,191,532 | )      |   | (18,153,167 | )      |   | (11,682,416 | ) |
| Proceeds                    from calls and maturities of investment securities |   |   |        |   |   |        |   |   |   |   |
| available                    for sale                                          |   |   | 11,780,714  |   |   | 10,049,002  |   |   | 15,358,053 |   |
| Proceeds                    from sales of investment securities available      |   |   |        |   |   |        |   |   |   |   |
| for                    sale                                          |   |   | 638,372     |   |   | 2,433,884   |   |   | 2,846,870 |   |
| Proceeds                    from sales of other investments                    |   |   | -           |   |   | -           |   |   | 161,100 |   |
| Purchase                    of other investments                               |   |   | (55,900     | )      |   | (10,100     | )      |   | - |   |
| Net                    change in loans                                         |   |   | (11,625,057 | )      |   | (20,718,845 | )      |   | (15,446,767 | ) |
| Purchases                    of premises and equipment                         |   |   | (1,363,899  | )      |   | (515,946    | )      |   | (2,419,351 | ) |
| Proceeds                    from sales of fixed assets                         |   |   | 139,184     |   |   | -           |   |   | 392,532 |   |
| Proceeds                    from sales of other real estate                    |   |   | 685,269     |   |   | 593,201     |   |   | 1,040,753 |   |
|                                                                           |   |   |        |   |   |        |   |   |   |   |
| Net                    cash used by investing activities                       |   |   | (52,992,849 | )      |   | (26,321,971 | )      |   | (9,749,226 | ) |
|                                                                           |   |   |        |   |   |        |   |   |   |   |
| Cash                    flows from financing activities:                       |   |   |        |   |   |        |   |   |   |   |
| Net                    change in deposits                                      |   |   | 47,195,927  |   |   | 25,045,921  |   |   | 3,132,531 |   |
| Net                    change in securities sold under repurchase agreements   |   |   | 915,343     |   |   | 1,055,436   |   |   | 290,328 |   |
| Dividends                    paid                                              |   |   | (1,124,769  | )      |   | (989,797    | )      |   | (899,885 | ) |
| Purchase                    and retirement of common stock                     |   |   | -           |   |   | (3,640      | )      |   | - |   |
|                                                                           |   |   |        |   |   |        |   |   |   |   |
| Net                    cash provided by financing activities                   |   |   | 46,986,501  |   |   | 25,107,920  |   |   | 2,522,974 |   |
|                                                                           |   |   |        |   |   |        |   |   |   |   |
| Net                    increase (decrease) in cash and cash equivalents        |   |   | (3,986,671  | )      |   | 3,311,293   |   |   | (2,241,436 | ) |
|                                                                           |   |   |        |   |   |        |   |   |   |   |
| Cash                    and cash equivalents at beginning of year              |   |   | 19,064,659  |   |   | 15,753,366  |   |   | 17,994,802 |   |
|                                                                           |   |   |        |   |   |        |   |   |   |   |
| Cash                    and cash equivalents at end of year               |   | $      | 15,077,988  |   |   | 19,064,659  |   |   | 15,753,366 |   |
|                                                                           |   |   |        |   |   |        |   |   |   |   |

----

|                                                                  |   | 2006   |      | 2005   |   | 2004      |   |
|-----------------------------------------------------------------------|--------|--------|-----------|--------|--------|-----------|--------|
|                                                                  |   |   |      |   |   |      |   |
| Supplemental                    disclosures of cash flow information: |   |   |      |   |   |      |   |   |   |   |
| Cash                    paid during the year for:                     |   |   |      |   |   |      |   |   |   |   |
| Interest                                                         |   | $      | 7,892,721 |   |   | 5,051,279 |   |   | 3,702,218 |   |
| Income                    taxes                                  |   | $      | 2,197,000 |   |   | 1,163,000 |   |   | 894,000 |   |
|                                                                  |   |   |      |   |   |      |   |   |   |   |
| Noncash                    investing and financing activities:        |   |   |      |   |   |      |   |   |   |   |
| Change                    in net unrealized gain on investment        |   |   |      |   |   |      |   |   |   |   |
| securities                    available for sale, net of tax     |   | $      | 143,592   |   |   | (663,077  | )      |   | (49,232 | ) |
| Transfer                    of loans to other real estate T      |   | $      | 146,650   |   |   | 112,665   |   |   | 781,608 |   |

----

| (1) | Summary                    of Significant                    Accounting Policies |
|-----|----------------------------------------------------------------------------------|

|   | Organization |
|--------|--------------|

|   | Oconee                    Financial Corporation (“OFC”) received regulatory approval to operate as a                    bank holding company on October 13, 1998, and began operations                    effective                    January 1, 1999. OFC is primarily regulated by the Federal Reserve                    Bank,                    and serves as the one-bank holding company for Oconee State                    Bank. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Oconee                    State Bank (the “Bank”) commenced business in 1960 upon receipt of its                    banking charter from the Georgia Department of Banking and Finance                    (the                    “DBF”). The Bank is primarily regulated by the DBF and the Federal                    Deposit                    Insurance Corporation and undergoes periodic examinations by                    these                    regulatory agencies. The Bank provides a full range of commercial                    and                    consumer banking services primarily in Oconee and Clarke counties                    in                    Georgia. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                    consolidated financial statements include the financial statements                    of                    Oconee Financial Corporation and its wholly owned subsidiary,                    Oconee State                    Bank (collectively called the “Company”). All significant intercompany                    balances and transactions have been eliminated in consolidation. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                    accounting principles followed by the Company, and the methods                    of applying                    these principles, conform with accounting principles generally                    accepted in                    the United States of America (“GAAP”) and with general practices in the                    banking industry. In preparing the financial statements in conformity                    with                    GAAP, management is required to make estimates and assumptions                    that affect                    the reported amounts in the financial statements. Actual results                    could                    differ significantly from these estimates. Material estimates                    common to                    the banking industry that are particularly susceptible to significant                    change in the near term include, but are not limited to, the                    determination                    of the allowance for loan losses, deferred taxes, and valuation                    of real                    estate acquired in connection with or in lieu of foreclosure                    on loans. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Cash                    and Cash                    Equivalents |
|--------|-----------------------------------------------------------------|

|   | For                    purposes of reporting cash flows, cash and cash equivalents include                    cash                    and due from banks and federal funds sold. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Investment                    Securities |
|--------|------------------------------------------|

|   | The                    Company classifies its securities in one of three categories:                    trading,                    available for sale, or held to maturity. Trading securities are                    bought and                    held principally for sale in the near term. Held to maturity                    securities                    are those securities for which the Company has the ability and                    intent to                    hold the security until maturity. All other securities not included                    in                    trading or held to maturity are classified as available for sale.                    At                    December 31, 2006 and 2005, the Company had classified all of                    its                    investment securities as available for                    sale. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Available                    for sale securities are recorded at fair value. Unrealized holding                    gains                    and losses, net of the related tax effect, on securities available                    for                    sale are excluded from earnings and are reported as a separate                    component                    of stockholders’ equity until realized. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | A                    decline in the market value of any available for sale or held                    to maturity                    security below cost that is deemed other than temporary is charged                    to                    earnings and establishes a new cost basis for the                    security. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Premiums                    and discounts are amortized or accreted over the life of the                    related                    security as an adjustment to the yield. Realized gains and losses                    for                    securities classified as available for sale and held to maturity                    are                    included in earnings and are derived using the specific identification                    method for determining the cost of securities                    sold. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (1) | Summary                    of Significant                    Accounting Policies,                    continued |
|-----|----------------------------------------------------------------------------------------------------------------|

|   | Other                    investments include Federal Home Loan Bank stock and other equity                    securities. No ready market exists for these securities and there                    is no                    quoted fair value. These investment securities are carried at                    cost. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Mortgage                    Loans Held                    for Sale |
|--------|--------------------------------------------------------------------|

|   | Mortgage                    loans held for sale are carried at the lower of aggregate cost                    or market                    value. At December 31, 2006 and 2005, the cost of mortgage loans                    held for                    sale approximates the market value. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Loans                    are stated at the principal amount outstanding, net of the allowance                    for                    loan losses. Interest on loans is calculated by using the simple                    interest                    method on daily balances of the principal amount outstanding.                    Loan                    origination and commitment fees, net of certain origination costs,                    are                    considered insignificant and are recognized immediately. Any                    significant                    net fees would be deferred and amortized as a yield adjustment                    over the                    lives of the related loans. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Impaired                    loans are measured based on the present value of expected future                    cash                    flows, discounted at the loan’s effective interest rate, or at the loan’s                    observable market price, or the fair value of the collateral                    if the loan                    is collateral dependent. A loan is impaired when, based on current                    information and events, it is probable that all amounts due according                    to                    the contractual terms of the loan will not be                    collected. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Accrual                    of interest is discontinued on a loan when management believes,                    after                    considering economic conditions and collection efforts, that                    the                    borrower’s financial condition is such that collection of interest is                    doubtful. Interest previously accrued but not collected is reversed                    against current period earnings and interest is recognized on                    a cash basis                    when such loans are placed on non-accrual                    status. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                    allowance for loan losses is established through a provision                    for loan                    losses charged to earnings. Loans are charged against the allowance                    for                    loan losses when management believes the collectibility of the                    principal                    is unlikely. The allowance represents an amount which, in management’s                    judgment, will be adequate to absorb probable losses on existing                    loans                    that may become uncollectible. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Management’s                    judgment in determining the adequacy of the allowance is based                    on                    evaluations of the collectibility of loans. These evaluations                    take into                    consideration such factors as changes in the nature and volume                    of the loan                    portfolio, current economic conditions that may affect the borrower’s                    ability to pay, overall portfolio quality and review of specific                    problem                    loans. The allowance consists of specific, general and unallocated                    components. The specific component relates to loans that are                    classified as                    either doubtful, substandard or special mention. The general                    component                    covers non-classified loans and is based on historical loss experience                    adjusted for qualitative factors. An unallocated component is                    maintained                    to cover uncertainties that could affect management’s estimate of probable                    losses. The unallocated component of the allowance reflects the                    margin of                    imprecision inherent in the underlying assumptions used in the                    methodologies for estimating specific and general losses in the                    portfolio.                    Management uses an external loan review program to challenge                    and                    corroborate the internal grading system and provide additional                    analysis in                    determining the adequacy of the allowance and the future provisions                    for                    estimated loan losses. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | While                    management uses available information to recognize losses on                    loans, future                    additions to the allowance may be necessary based on changes                    in economic                    conditions. In addition, various regulatory agencies, as an integral                    part                    of their examination process, periodically review the Company’s allowance                    for loan losses. Such agencies may require the Company to recognize                    additions to the allowance based on judgments different than                    those of                    management. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Premises                    and                    Equipment |
|--------|--------------------------------------------------------------|

|   | Premises                    and equipment are stated at cost less accumulated depreciation.                    Depreciation is computed primarily using the straight-line method                    over the                    estimated useful lives of the assets. Leasehold improvements                    are amortized                    over the shorter period of the useful life of the asset or the                    lease term.                    When assets are retired or otherwise disposed, the cost and related                    accumulated depreciation are removed from the accounts, and any                    gain or                    loss is reflected in earnings for the period. The cost of maintenance                    and                    repairs which do not improve or extend the useful life of the                    respective                    asset is charged to earnings as incurred, whereas significant                    improvements                    are capitalized. The range of estimated useful lives for premises                    and                    equipment are generally as follows: |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Buildings                    and improvements | 5                    -                    40 years |
|-----------------------------------------------|----------------------------------------------------|
| Furniture                    and equipment    | 3                    -                    10 years |
|                                          |                                               |

----

| (1) | Summary                        of Significant                        Accounting Policies,                        continued |
|-----|----------------------------------------------------------------------------------------------------------------------------|

|   | Properties                      acquired through foreclosure are carried at the lower of cost                      (defined as                      fair value at foreclosure) or fair value less estimated costs                      to dispose.                      Accounting guidance defines fair value as the amount that is                      expected to                      be received in a current sale between a willing buyer and seller                      other                      than in a forced or liquidation sale. Fair values at foreclosure                      are based                      on appraisals. Losses arising from the acquisition of foreclosed                      properties are charged against the allowance for loan losses.                      Subsequent                      write-downs are provided by a charge to income through the                      allowance for                      losses on other real estate in the period in which the need                      arises. The                      carrying amount of foreclosed assets at December 31, 2006 and                      2005 was                      $739,777 and $318,756,                      respectively. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Securities                      Sold Under                      Repurchase Agreements |
|--------|---------------------------------------------------------------------------------------|

|   | Securities                      sold under repurchase agreements are treated as financing activities,                      and                      are carried at the amounts at which the securities will be                      repurchased as                      specified in the respective                      agreements. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Deferred                      tax assets and liabilities are recognized for the future tax                      consequences                      attributable to differences between the financial statement                      carrying                      amounts of existing assets and liabilities and their respective                      tax bases.                      Additionally, the recognition of future tax benefits, such                      as net                      operating loss carryforwards, is required to the extent that                      realization                      of such benefits is more likely than not. Deferred tax assets                      and                      liabilities are measured using enacted tax rates expected to                      apply to                      taxable income in the years in which the assets and liabilities                      are                      expected to be recovered or settled. The effect on deferred                      tax assets and                      liabilities of a change in tax rates is recognized in income                      tax expense                      in the period that includes the enactment                      date. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In                      the event the future tax consequences of differences between                      the financial                      reporting bases and the tax bases of the Company’s assets and liabilities                      result in deferred tax assets, an evaluation of the probability                      of being                      able to realize the future benefits indicated by such assets                      is required.                      A valuation allowance is provided for the portion of the deferred                      tax                      asset when it is more likely than not that some portion or                      all of the                      deferred tax asset will not be realized. In assessing the realizability                      of                      the deferred tax assets, management considers the scheduled                      reversals of                      deferred tax liabilities, projected future taxable income,                      and tax                      planning strategies. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Mortgage                      Banking                      Income |
|--------|-------------------------------------------------------------------|

|   | Mortgage                      banking income represents net gains from the sale of mortgage                      loans and                      fees received from borrowers and loan investors related to                      the Bank’s                      origination of single-family residential mortgage                      loans. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Earnings                      Per                      Share |
|--------|--------------------------------------------------------------|

|   | Earnings                      per common share are based on the weighted average number of                      common shares                      outstanding during the period while the effects of potential                      common shares                      outstanding during the period are included in diluted earnings                      per share.                      The Company had no potential common share equivalents outstanding                      during                      2006, 2005 and 2004. For each of those years, earnings per                      share is                      calculated using the weighted average shares outstanding during                      the period                      of 899,815 for 2006, 899,850 for 2005 and 899,885 for                      2004. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Reclassification |
|--------|------------------|

|   | Reclassifications                      of certain amounts in the 2005 and 2004 consolidated statements                      of                      earnings have been made to conform with the financial statement                      presentation for 2006. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (1) | Summary                      of Significant                      Accounting Policies,                      continued |
|-----|----------------------------------------------------------------------------------------------------------------------|

----

| (2) | Investment                      Securities |
|-----|--------------------------------------------|

|   | Investment                      securities available for sale at December 31, 2006 and 2005                      are as                      follows: |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                               |   |                        December 31, 2006         |       |
|----------------------------------------------------|--------|-------------------------------------------------------|------------|
|                                               |   |  Amortized                       Cost  |       | GrossUnrealizedGains  |   | GrossUnrealizedLosses  |   | EstimatedFair                       Value  |   |
|                                               |   |                                                  |       |   |   |   |   |   |   |
| Government                      sponsored agencies |   | $                                                     | 59,385,623 |   |   | 146,467 |   |   | 188,269 |   |   | 59,343,821 |   |
| State,                      county and municipal   |   |                                                  | 20,555,014 |   |   | 295,841 |   |   | 41,152 |   |   | 20,809,703 |   |
| Mortgage-backed                      securities    |   |                                                  | 11,469,059 |   |   | 19,787 |   |   | 250,924 |   |   | 11,237,922 |   |
| Other                      debt securities         |   |                                                  | 1,000,000  |   |   | - |   |   | 19,200 |   |   | 980,800 |   |
|                                               |   |                                                  |       |   |   |   |   |   |   |   |   |   |   |
| Total                                              |   | $                                                     | 92,409,696 |   |   | 462,095 |   |   | 499,545 |   |   | 92,372,246 |   |

|                                               |   | December                      31, 2005                |       |
|----------------------------------------------------|--------|-------------------------------------------------------|------------|
|                                               |   |  Amortized                       Cost  |       | GrossUnrealizedGains  |   | GrossUnrealizedLosses  |   | EstimatedFair                       Value  |   |
|                                               |   |                                                  |       |   |   |   |   |   |   |
| Government                      sponsored agencies |   | $                                                     | 20,883,971 |   |   | 26,225 |   |   | 255,366 |   |   | 20,654,830 |   |
| State,                      county and municipal   |   |                                                  | 18,167,950 |   |   | 400,204 |   |   | 92,683 |   |   | 18,475,471 |   |
| Mortgage-backed                      securities    |   |                                                  | 11,050,719 |   |   | - |   |   | 347,280 |   |   | 10,703,439 |   |
| Other                      debt securities         |   |                                                  | 1,500,000  |   |   | - |   |   | - |   |   | 1,500,000 |   |
|                                               |   |                                                  |       |   |   |   |   |   |   |   |   |   |   |
| Total                                              |   | $                                                     | 51,602,640 |   |   | 426,429 |   |   | 695,329 |   |   | 51,333,740 |   |

|                                               |   |  December                      31, 2006   |       |
|----------------------------------------------------|--------|------------------------------------------------|------------|
|                                               |   |  Less                      than 12 Months |       |  12                      Months or More |   |
|                                               |   | Fair                      Value                |       | UnrealizedLosses |   | Fair                      Value |   | UnrealizedLosses |   |
| Government                      sponsored agencies |   | $                                              | 22,542,160 |   |   | 39,683 |   |   | 9,835,781 |   |   | 148,586 |   |
| State,                      county and municipal   |   |                                           | 4,009,783  |   |   | 6,419 |   |   | 1,666,512 |   |   | 34,733 |   |
| Mortgage-backed                      securities    |   |                                           | -          |   |   | - |   |   | 8,242,891 |   |   | 250,924 |   |
| Other                      debt securities         |   |                                           | -          |   |   | - |   |   | 980,800 |   |   | 19,200 |   |
|                                               |   |                                           |       |   |   |   |   |   |   |   |   |   |   |
|                                               |   | $                                              | 26,551,943 |   |   | 46,102 |   |   | 20,725,984 |   |   | 453,443 |   |

|                                               |   | December                      31, 2005   |       |
|----------------------------------------------------|--------|------------------------------------------|------------|
|                                               |   | Less                      than 12 Months |       | 12                      Months or More |   |
|                                               |   |  Fair                      Value    |       | UnrealizedLosses |   | Fair                      Value |   | UnrealizedLosses |   |
| Government                      sponsored agencies |   | $                                        | 13,316,682 |   |   | 149,246 |   |   | 5,390,000 |   |   | 106,120 |   |
| State,                      county and municipal   |   |                                     | 4,550,179  |   |   | 85,490 |   |   | 200,250 |   |   | 7,193 |   |
| Mortgage-backed                      securities    |   |                                     | 6,875,287  |   |   | 192,272 |   |   | 3,828,152 |   |   | 155,008 |   |
|                                               |   |                                     |       |   |   |   |   |   |   |   |   |   |   |
|                                               |   | $                                        | 24,742,148 |   |   | 427,008 |   |   | 9,418,402 |   |   | 268,321 |   |

----

| (2) | Investment                        Securities,                        continued |
|-----|--------------------------------------------------------------------------------|

|                                            |   | Amortized                       Cost  |       | EstimatedFair                      Value |   |
|-------------------------------------------------|--------|-------------------------------------------------|------------|------------------------------------------|--------|
| Due                      within one year        |   | $                                               | 10,408,558 |                                     |   | 10,401,132 |   |
| Due                      from one to five years |   |                                            | 24,401,624 |                                     |   | 24,265,017 |   |
| Due                      from five to ten years |   |                                            | 14,171,466 |                                     |   | 14,217,516 |   |
| Due                      after ten years        |   |                                            | 31,958,989 |                                     |   | 32,250,659 |   |
| Mortgage-backed                      securities |   |                                            | 11,469,059 |                                     |   | 11,237,922 |   |
|                                            |   |                                            |       |                                     |   |   |   |
|                                            |   | $                                               | 92,409,696 |                                     |   | 92,372,246 |   |

| (3) | Loans |
|-----|-------|

|                                                              |   | 2006   |        | 2005   |   |
|-------------------------------------------------------------------|--------|--------|-------------|--------|--------|
|                                                              |   |   |        |   |   |
| Commercial,                      financial and agricultural  |   | $      | 20,468,788  |   |   | 21,012,994 |   |
| Real                      estate - mortgage                       |   |   | 100,620,440 |   |   | 103,029,748 |   |
| Real                      estate - commercial construction        |   |   | 83,998,612  |   |   | 68,953,557 |   |
| Real                      estate - consumer construction          |   |   | 3,265,639   |   |   | 3,579,787 |   |
| Consumer                                                          |   |   | 9,533,930   |   |   | 9,897,511 |   |
|                                                              |   |   |        |   |   |   |   |
| Total                      loans                                  |   |   | 217,887,409 |   |   | 206,473,597 |   |
| Less                      allowance for loan losses               |   |   | 3,080,661   |   |   | 2,945,256 |   |
| Total                      net loans                              |   | $      | 214,806,748 |   |   | 203,528,341 |   |

----

| (3) | Loans,                      continued |
|-----|---------------------------------------|

|   | At                      December 31, 2006 and 2005, the recorded investment in loans                      that were                      considered to be impaired and on nonaccrual was approximately                      $678,000 and                      $2,151,000, respectively. In addition, the Company had approximately                      $623,000 and $632,000 in loans past due more than ninety days                      and still                      accruing interest at December 31, 2006 and 2005, respectively.                      These                      accounts are deemed to be well collateralized and in the process                      of                      collection. The related allowance for loan losses on impaired                      loans was                      approximately $102,000 and $323,000 at December 31, 2006 and                      2005,                      respectively. The average recorded investment in impaired loans                      for the                      twelve months ended December 31, 2006, 2005 and 2004 was approximately                      $1,439,000, $1,380,000 and $5,653,000, respectively. For the                      years ended                      December 31, 2006, 2005 and 2004, the Company recognized approximately                      $14,000, $170,000 and $257,000, respectively, of interest income                      on                      impaired loans. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Changes                      in the allowance for loan losses were as                      follows: |
|--------|-----------------------------------------------------------------------------------------------------|

|                                                              |   | 2006   |      | 2005   |   | 2004      |   |
|-------------------------------------------------------------------|--------|--------|-----------|--------|--------|-----------|--------|
|                                                              |   |   |      |   |   |      |   |
| Balance                      at beginning of year            |   | $      | 2,945,256 |   |   | 2,531,330 |   |   | 2,669,204 |   |
| Provision                      for loan losses                    |   |   | 200,000   |   |   | 612,000   |   |   | 394,200 |   |
| Amounts                      charged off                          |   |   | (110,317  | )      |   | (252,848  | )      |   | (726,021 | ) |
| Recoveries                      on amounts previously charged off |   |   | 45,722    |   |   | 54,774    |   |   | 193,947 |   |
|                                                              |   |   |      |   |   |      |   |   |   |   |
| Balance                      at end of year                  |   | $      | 3,080,661 |   |   | 2,945,256 |   |   | 2,531,330 |   |

| (4) | Premises                      and                      Equipment |
|-----|------------------------------------------------------------------|

|                                                                               |   | 2006   |       | 2005   |   |
|------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|
|                                                                               |   |   |       |   |   |
| Land                                                                               |   | $      | 1,354,181  |   |   | 1,083,436 |   |
| Buildings                      and improvements                                    |   |   | 5,089,489  |   |   | 4,570,374 |   |
| Furniture                      and equipment                                       |   |   | 4,934,972  |   |   | 4,730,100 |   |
| Leasehold                      improvements                                        |   |   | -          |   |   | 58,902 |   |
| Construction                      in process (estimated cost to complete $554,000) |   |   | 60,924     |   |   | 7,937 |   |
|                                                                               |   |   | 11,439,566 |   |   | 10,450,749 |   |
|                                                                               |   |   |       |   |   |   |   |
| Less                      accumulated depreciation                                 |   |   | 4,981,039  |   |   | 4,631,283 |   |
|                                                                               |   |   |       |   |   |   |   |
|                                                                               |   | $      | 6,458,527  |   |   | 5,819,466 |   |

| Years                      Ending December 31,    |   |   |      |   |
|---------------------------------------------------|--------|--------|-----------|--------|
| 2007                                              |   | $      | 149,834   |   |
| 2008                                              |   |   | 143,250   |   |
| 2009                                              |   |   | 129,936   |   |
| 2010                                              |   |   | 95,218    |   |
| 2011                                              |   |   | 93,660    |   |
| Thereafter                                        |   |   | 487,306   |   |
|                                              |   |   |      |   |
| Total                      minimum lease payments |   | $      | 1,099,204 |   |

----

| (5) | Deposits |
|-----|----------|

| 2007   |   | $      | 138,627,037 |   |
|--------|--------|--------|-------------|--------|
| 2008   |   |   | 8,522,076   |   |
| 2009   |   |   | 1,808,608   |   |
| 2010   |   |   | 1,430,537   |   |
| 2011   |   |   | 216,487     |   |
|   |   | $      | 150,604,745 |   |

| (6) | Income                      Taxes |
|-----|-----------------------------------|

|                                          |   | 2006   |      | 2005   |   | 2004      |   |
|-----------------------------------------------|--------|--------|-----------|--------|--------|-----------|--------|
| Current                                       |   | $      | 1,760,776 |   |   | 1,457,293 |   |   | 749,833 |   |
| Deferred                                      |   |   | 78,663    |   |   | (110,503  | )      |   | 264,600 |   |
| Total                      income tax expense |   | $      | 1,839,439 |   |   | 1,346,790 |   |   | 1,014,433 |   |

|                                                        |   | 2006   |      | 2005   |   | 2004      |   |
|-------------------------------------------------------------|--------|--------|-----------|--------|--------|-----------|--------|
| Pretax                      income at statutory rates  |   | $      | 1,971,893 |   |   | 1,496,793 |   |   | 1,205,290 |   |
| Add                      (deduct):                          |   |   |      |   |   |      |   |   |   |   |
| Tax                      exempt interest income             |   |   | (302,235  | )      |   | (273,916  | )      |   | (269,092 | ) |
| Non-deductible                      interest expense        |   |   | 36,578    |   |   | 23,923    |   |   | 17,714 |   |
| State                      taxes, net of federal effect     |   |   | 180,799   |   |   | 95,447    |   |   | 61,775 |   |
| Other                                                       |   |   | (47,596   | )      |   | 4,543     |   |   | (1,254 | ) |
|                                                        |   | $      | 1,839,439 |   |   | 1,346,790 |   |   | 1,014,433 |   |

|                                                                              |   | 2006   |      | 2005   |   |
|-----------------------------------------------------------------------------------|--------|--------|-----------|--------|--------|
| Deferred                      income tax assets:                                  |   |   |      |   |   |   |   |
| Allowance                      for loan losses                                    |   | $      | 1,071,415 |   |   | 1,010,901 |   |
| Other                      real estate                                            |   |   | 14,062    |   |   | 43,547 |   |
| Unrealized                      gains on investment securities available for sale |   |   | 14,216    |   |   | 102,074 |   |
| Total                      gross deferred income tax assets                  |   |   | 1,099,693 |   |   | 1,156,522 |   |
| Deferred                      income tax liabilities:                             |   |   |      |   |   |   |   |
| Premises                      and equipment                                       |   |   | (491,363  | )      |   | (381,671 | ) |
|                                                                              |   |   |      |   |   |   |   |
| Total                      gross deferred income tax liabilities             |   |   | (491,363  | )      |   | (381,671 | ) |
| Net                      deferred income tax asset                           |   | $      | 608,330   |   |   | 774,851 |   |

----

| (7) | Related                      Party                      Transactions |
|-----|----------------------------------------------------------------------|

|   | The                      Company conducts transactions with directors and executive                      officers,                      including companies in which they have beneficial interests,                      in the normal                      course of business. It is the policy of the Company that loan                      transactions                      with directors and officers are made on substantially the same                      terms as                      those prevailing at the time made for comparable loans to other                      persons.                      The following is a summary of activity for related party                      loans: |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Beginning                      balance |   | $      | 9,800,000  |   |
|----------------------------------------|--------|--------|------------|--------|
| New                      loans         |   |   | 2,598,000  |   |
| Repayments                             |   |   | (6,072,000 | )      |
|                                   |   |   |       |   |
| Ending                      balance    |   | $      | 6,326,000  |   |

| (8) | Commitments |
|-----|-------------|

|   | The                      Company is a party to financial instruments with off-balance-sheet                      risk in                      the normal course of business to meet the financing needs of                      its                      customers. These financial instruments include commitments                      to extend                      credit and standby letters of credit. Those instruments involve,                      to                      varying degrees, elements of credit risk in excess of the amount                      recognized in the balance sheet. The contract amounts of those                      instruments                      reflect the extent of involvement the Company has in particular                      classes of                      financial instruments. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                      |   | Contractual                      Amount |       |
|-----------------------------------------------------------|--------|-----------------------------------------|------------|
|                                                      |   |  2006                              |       |  2005 |   |
| Financial                      instruments whose contract |   |                                    |       |   |   |   |   |
| amounts                      represent credit risk:       |   |                                    |       |   |   |   |   |
| Commitments                      to extend credit    |   | $                                       | 42,490,000 |   |   | 52,219,000 |   |
| Standby                      letters of credit            |   | $                                       | 276,000    |   |   | 515,000 |   |

|   | Commitments                      to extend credit are agreements to lend to a customer as long                      as there is                      no violation of any condition established in the contract.                      Commitments                      generally have fixed expiration dates or other termination                      clauses and may                      require payment of a fee. Since many of the commitments may                      expire without                      being drawn upon, the total commitment amounts do not necessarily                      represent future cash requirements. The Company evaluates each                      customer’s                      creditworthiness on a case-by-case basis. The amount of collateral                      obtained, if deemed necessary by the Bank, upon extension of                      credit is                      based on management’s credit evaluation. Collateral held varies but may                      include unimproved and improved real estate, certificates of                      deposit, or                      personal property. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Standby                      letters of credit written are conditional commitments issued                      by the                      Company to guarantee the performance of a customer to a third                      party. Those                      guarantees are primarily issued to businesses in the Company’s delineated                      trade area. The credit risk involved in issuing letters of                      credit is                      essentially the same as that involved in extending loan facilities                      to                      customers. The Company holds real estate, equipment, automobiles                      and                      customer deposits as collateral supporting those commitments                      for which                      collateral is deemed necessary. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                      Company has $7,000,000 available for the purchase of overnight                      federal                      funds from two correspondent financial institutions as of December                      31,                      2006 and 2005. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (9) | Profit                      Sharing                      Plan |
|-----|---------------------------------------------------------------|

|   | The                      Company has a contributory profit sharing plan which is available                      to                      substantially all employees subject to certain age and service                      requirements. Contributions to the plan are determined annually                      by the                      Board of Directors. The total contributions by the Company                      for 2006, 2005                      and 2004 were approximately $378,000, $309,000 and $256,000,                      respectively. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (10) | Regulatory                      Matters |
|------|-----------------------------------------|

|   | The                      Company is subject to various regulatory capital requirements                      administered                      by the federal banking agencies. Failure to meet minimum capital                      requirements can initiate certain mandatory and possibly additional                      discretionary actions by regulators that, if undertaken, could                      have a                      direct material effect on the Company’s financial statements. Under                      capital adequacy guidelines and the regulatory framework for                      prompt                      corrective action, the Bank must meet specific capital guidelines                      that                      involve quantitative measures of the assets, liabilities and                      certain                      off-balance-sheet items as calculated under regulatory accounting                      practices. The capital amounts and classification are also                      subject to                      qualitative judgments by the regulators about components, risk                      weightings,                      and other factors. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The                      capital ratios for the Company are essentially the same as                      those of the                      Bank. Therefore, only the Bank’s capital ratios are presented in the                      following table (dollars in                      thousands): |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                               |   |                                     |   |                                   |   |                                   |   |                                   |   | To                      Be Well        |   |
|--------------------------------------------------------------------|--------|------------------------------------------|--------|----------------------------------------|--------|----------------------------------------|--------|----------------------------------------|--------|----------------------------------------|--------|
|                                                               |   |                                     |   |                                   |   |                                   |   |                                   |   | Capitalized                      Under |   |
|                                                               |   |                                     |   |                                   |   | For                      Capital       |   | Prompt                      Corrective |   |
|                                                               |   |                        Actual  |   | Adequacy                      Purposes |   | Action                      Provisions |   |
|                                                               |   | Amount                                   |   | Ratio                                  |   | Amount                                 |   | Ratio                                  |   | Amount                                 |   | Ratio |   |
| As                      of December 31,                      2006: |   |                                     |   |                                   |   |                                   |   |                                   |   |                                   |   |   |   |
| Total                      Capital                                 |   |                                     |   |                                   |   |                                   |   |                                   |   |                                   |   |   |   |   |   |   |   |   |   |
| (to                      Risk-Weighted Assets)                     |   | $                                        | 29,646 |                                   |   | 12.4%                                  |   | $                                      | 19,183 |                                   |   | 8.0% |   | $ | 23,978 |   |   | 10.0% |   |
| Tier                      1 Capital                                |   |                                     |   |                                   |   |                                   |   |                                   |   |                                   |   |   |   |   |   |   |   |   |   |
| (to                      Risk-Weighted Assets)                     |   | $                                        | 26,648 |                                   |   | 11.1%                                  |   | $                                      | 9,591  |                                   |   | 4.0% |   | $ | 14,387 |   |   | 6.0% |   |
| Tier                      1 Capital                                |   |                                     |   |                                   |   |                                   |   |                                   |   |                                   |   |   |   |   |   |   |   |   |   |
| (to                      Average Assets)                           |   | $                                        | 26,648 |                                   |   | 8.6%                                   |   | $                                      | 12,431 |                                   |   | 4.0% |   | $ | 15,538 |   |   | 5.0% |   |
|                                                               |   |                                     |   |                                   |   |                                   |   |                                   |   |                                   |   |   |   |   |   |   |   |   |   |
| As                      of December 31,                      2005: |   |                                     |   |                                   |   |                                   |   |                                   |   |                                   |   |   |   |   |   |   |   |   |   |
| Total                      Capital                                 |   |                                     |   |                                   |   |                                   |   |                                   |   |                                   |   |   |   |   |   |   |   |   |   |
| (to                      Risk-Weighted Assets)                     |   | $                                        | 26,511 |                                   |   | 12.4%                                  |   | $                                      | 17,164 |                                   |   | 8.0% |   | $ | 21,455 |   |   | 10.0% |   |
| Tier                      1 Capital                                |   |                                     |   |                                   |   |                                   |   |                                   |   |                                   |   |   |   |   |   |   |   |   |   |
| (to                      Risk-Weighted Assets)                     |   | $                                        | 23,827 |                                   |   | 11.1%                                  |   | $                                      | 8,582  |                                   |   | 4.0% |   | $ | 12,873 |   |   | 6.0% |   |
| Tier                      1 Capital                                |   |                                     |   |                                   |   |                                   |   |                                   |   |                                   |   |   |   |   |   |   |   |   |   |
| (to                      Average Assets)                           |   | $                                        | 23,827 |                                   |   | 8.4%                                   |   | $                                      | 11,351 |                                   |   | 4.0% |   | $ | 14,188 |   |   | 5.0% |   |

| (11) | Stockholders’                          Equity |
|------|-----------------------------------------------------|

----

| (12) | Fair                      Value of Financial                      Instruments |
|------|-------------------------------------------------------------------------------|

|   | The                      Company is required to disclose fair value information about                      financial                      instruments, whether or not recognized on the face of the balance                      sheet,                      for which it is practicable to estimate that value. The assumptions                      used                      in the estimation of the fair value of the Company’s financial instruments                      are detailed below. Where quoted prices are not available,                      fair values are                      based on estimates using discounted cash flows and other valuation                      techniques. The use of discounted cash flows can be significantly                      affected                      by the assumptions used, including the discount rate and estimates                      of                      future cash flows. The following disclosures should not be                      considered a                      surrogate of the liquidation value of the Company, but rather                      a good faith                      estimate of the increase or decrease in value of financial                      instruments                      held by the Company since purchase, origination or                      issuance. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (12) | Fair                      Value of Financial                      Instruments, continued |
|------|------------------------------------------------------------------------------------------|

|                                                    |   |                        2006  |    | 2005                       |   |
|---------------------------------------------------------|--------|----------------------------------------|---------|---------------------------------|--------|
|                                                    |   | Carrying                               |    | Estimated                       |   | Carrying |   | Estimated |   |
|                                                    |   | Amount                                 |    | Fair                      Value |   | Amount |   | Fair                      Value |   |
| Assets:                                                 |   |                                   |    |                            |   |   |   |   |   |   |   |   |   |
| Cash                      and cash equivalents          |   | $                                      | 15,078  |                            |   | 15,078 |   |   | 19,065 |   |   | 19,065 |   |
| Investment                      securities              |   | $                                      | 92,372  |                            |   | 92,372 |   |   | 51,334 |   |   | 51,334 |   |
| Other                      investments                  |   | $                                      | 670     |                            |   | 670 |   |   | 614 |   |   | 614 |   |
| Mortgage                      loans held for sale       |   | $                                      | 1,976   |                            |   | 1,976 |   |   | 1,285 |   |   | 1,285 |   |
| Loans,                      net                         |   | $                                      | 214,807 |                            |   | 216,826 |   |   | 203,528 |   |   | 204,279 |   |
|                                                    |   |                                   |    |                            |   |   |   |   |   |   |   |   |   |
| Liabilities:                                            |   |                                   |    |                            |   |   |   |   |   |   |   |   |   |
| Deposits                      and securities sold under |   |                                   |    |                            |   |   |   |   |   |   |   |   |   |
| repurchase                      agreement               |   | $                                      | 307,155 |                            |   | 305,208 |   |   | 259,043 |   |   | 260,106 |   |

| (13) | Other                      Operating                      Expenses |
|------|--------------------------------------------------------------------|

|                                                    |   | 2006 |    | 2005   |   | 2004    |   |
|---------------------------------------------------------|--------|------|---------|--------|--------|---------|--------|
| Professional                      fees                  |   | $    | 399,709 |   |   | 367,823 |   |   | 337,210 |   |
| Marketing                      expenses                 |   | $    | 206,436 |   |   | 215,631 |   |   | 228,866 |   |
| ATM                      process and settlement charges |   | $    | 291,791 |   |   | 268,949 |   |   | 239,301 |   |

| (14) | Oconee                      Financial Corporation                      (Parent Company Only) Financial                      Information |
|------|-----------------------------------------------------------------------------------------------------------------------------------------|

|                                                                  |   | 2006   |       |  2005 |   |
|-----------------------------------------------------------------------|--------|--------|------------|------------|--------|
|  Assets                                                          |   |   |       |       |   |
| Cash                                                                  |   | $      | 1,212,854  |       |   | 1,063,125 |   |
| Investment                      in subsidiary                         |   |   | 26,624,768 |       |   | 23,660,607 |   |
| Other                      assets                                     |   |   | 323        |       |   | 171 |   |
|                                                                  |   |   |       |       |   |   |   |
|                                                                  |   | $      | 27,837,945 |       |   | 24,723,903 |   |
|  Liabilities                      and Stockholders’ Equity |   |   |       |       |   |   |   |
| Other                      liabilities                                |   | $      | 1,124,769  |       |   | 989,797 |   |
| Stockholders’                      equity                       |   |   | 26,713,176 |       |   | 23,734,106 |   |
|                                                                  |   | $      | 27,837,945 |       |   | 24,723,903 |   |

----

| (14) | Oconee                      Financial Corporation                      (Parent Company Only) Financial Information,                      continued |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------|

| Statements                      of Earnings                                                    |
|------------------------------------------------------------------------------------------------|
|                                                                                           |   |   |
| For                      the Years Ended December 31, 2006, 2005 and                      2004 |

|                                                                  |   | 2006   |      | 2005   |   | 2004      |   |
|-----------------------------------------------------------------------|--------|--------|-----------|--------|--------|-----------|--------|
|                                                                  |   |   |      |   |   |      |   |
| Dividends                      from subsidiary                        |   | $      | 1,174,769 |   |   | 1,039,797 |   |   | 899,885 |   |
|                                                                  |   |   |      |   |   |      |   |   |   |   |
| Other                      expenses                                   |   |   | 56,564    |   |   | 49,474    |   |   | 50,936 |   |
|                                                                  |   |   |      |   |   |      |   |   |   |   |
| Earnings                      before income taxes and equity in       |   |   |      |   |   |      |   |   |   |   |
| undistributed                      earnings of subsidiary             |   |   | 1,118,205 |   |   | 990,323   |   |   | 848,949 |   |
|                                                                  |   |   |      |   |   |      |   |   |   |   |
| Income                      tax benefit                               |   |   | 21,472    |   |   | 18,780    |   |   | 19,335 |   |
|                                                                  |   |   |      |   |   |      |   |   |   |   |
| Earnings                      before equity in undistributed earnings |   |   |      |   |   |      |   |   |   |   |
| of                      subsidiary                                    |   |   | 1,139,677 |   |   | 1,009,103 |   |   | 868,284 |   |
|                                                                  |   |   |      |   |   |      |   |   |   |   |
| Equity                      in undistributed earnings of subsidiary   |   |   | 2,820,570 |   |   | 2,046,436 |   |   | 1,662,252 |   |
|                                                                  |   |   |      |   |   |      |   |   |   |   |
| Net                      earnings                                     |   | $      | 3,960,247 |   |   | 3,055,539 |   |   | 2,530,536 |   |

|                                                                 |   | 2006   |       | 2005   |   | 2004       |   |
|----------------------------------------------------------------------|--------|--------|------------|--------|--------|------------|--------|
| Cash                      flows from operating activities:           |   |   |       |   |   |       |   |   |   |   |
| Net                      earnings                                    |   | $      | 3,960,247  |   |   | 3,055,539  |   |   | 2,530,536 |   |
| Adjustments                      to reconcile net earnings           |   |   |       |   |   |       |   |   |   |   |
| to                      net cash provided by operating activities:   |   |   |       |   |   |       |   |   |   |   |
| Equity                      in undistributed earnings of subsidiary  |   |   | (2,820,570 | )      |   | (2,046,436 | )      |   | (1,662,252 | ) |
| Change                      in:                                      |   |   |       |   |   |       |   |   |   |   |
| Other                      assets                                    |   |   | (151       | )      |   | 2,219      |   |   | (2,390 | ) |
| Other                      liabilities                          |   |   | 134,972    |   |   | 89,911     |   |   | (1,043 | ) |
| Net                      cash provided by operating activities  |   |   | 1,274,498  |   |   | 1,101,233  |   |   | 864,851 |   |
| Cash                      flows from financing activities:           |   |   |       |   |   |       |   |   |   |   |
| Dividends                      paid                                  |   |   | (1,124,769 | )      |   | (989,797   | )      |   | (899,885 | ) |
| Purchase                      and retirement of common stock         |   |   | -          |   |   | (3,640     | )      |   | - |   |
|                                                                 |   |   |       |   |   |       |   |   |   |   |
| Net                      cash used by financing activities           |   |   | (1,124,769 | )      |   | (993,437   | )      |   | (899,885 | ) |
|                                                                 |   |   |       |   |   |       |   |   |   |   |
| Change                      in cash                             |   |   | 149,729    |   |   | 107,796    |   |   | (35,034 | ) |
| Cash                      at beginning of year                  |   |   | 1,063,125  |   |   | 955,329    |   |   | 990,363 |   |
| Cash                      at end of year                        |   | $      | 1,212,854  |   |   | 1,063,125  |   |   | 955,329 |   |
|                                                                 |   |   |       |   |   |       |   |   |   |   |

----

SIGNATURES

|   | OCONEEFINANCIAL                  CORPORATION(Registrant)  By:                              /s/ B. Amrey                  Harden                                                                            B.Amrey                  HardenPresident                  and Chief Executive                  Officer |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Signature                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | Title                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                          |                                                                                                         |
| *                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| G.                  Robert                  Bishop                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| *                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Jimmy                  L.                  Christopher                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| *                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Douglas                  D.                  Dickens                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | Chairman                  of the Board of                  Directors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| *                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| John                  A.                  Hale                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | Vice                  Chairman of the Board of                  Directors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| /s/                  B. Amrey                  Harden                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| B.                  Amrey                  Harden                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | President                  and Chief Executive                  Officer, Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| *                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Henry                  C.                  Maxey                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| *                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Carl                  R.                  Nichols                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| *                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Ann                  Breedlove                  Powers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| /s/                  Steven A. Rogers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Steven                  A. Rogers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Vice                  President and Controller, Chief Accounting Officer                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| /s/                  Jerry K.                  Wages                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Jerry                  K.                  Wages                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Senior                  Executive Vice President                  and Chief FinancialOfficer,                    Corporate Secretary, and                    Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| *                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Virginia                  S. Wells                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| *                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Tom                  F.                  Wilson                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | Executive                  Vice President and Chief Loan Officer, Director                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| *                  By:       /s/                  B.Amrey                  Harden                                                                                                B.Amrey                  HardenPresident                  and Chief Executive                  Officer |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

----

| Exhibit  | Description                                                                                                                            |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------|
| 31.1     | Certification                  of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley                  Act of 2002.  |
| 31.2     | Certification                  of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley                  Act of 2002.  |
| 32.1     | Section                  1350 Certification of Chief Executive Officer.                                                                |
| 32.2     | Section                  1350 Certification of Chief Financial Officer.                                                                |