UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q


X        QUARTERLY  REPORT  PURSUANT  TO SECTION  13 OR 15(d) OF THE  SECURITIES
         EXCHANGE ACT OF 1934 (no fee required)  For the quarterly  period ended
         September 30, 2001

                                       OR

___      TRANSITION  REPORT  PURSUANT  TO SECTION 13 or 15(d) OF THE  SECURITIES
         EXCHANGE ACT OF 1934 (no fee required) For the  transition  period from
         ________ to ________





                           Commission File No. 0-25988

                          CNB Florida Bancshares, Inc.
                          ----------------------------
             (Exact Name of Registrant as Specified in Its Charter)


           FLORIDA                                        59-2958616
 ------------------------------                       -----------------
 (State or other jurisdiction                         (I.R.S. Employer
 of incorporation or organization)                    Identification No.)


 9715 Gate Parkway North
 Jacksonville, Florida                                      32246
 -------------------------------                      -------------------
 (Address of principal executive offices)                   (Zip Code)


 Registrant's telephone number, including area code: (904) 997-8484


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes X No___

The number of shares of the registrant's  common stock outstanding as of October
31,  2001  was  6,082,377  shares,  $0.01  par  value  per  share.


<PAGE>

                          CNB FLORIDA BANCSHARES, INC.
                          FINANCIAL REPORT ON FORM 10-Q


                                TABLE OF CONTENTS


PART I - FINANCIAL INFORMATION
         Item 1.  Financial Statements
                  (unaudited)

         Consolidated Statement of Financial Condition.........................3
         Consolidated Statement of Income......................................4
         Consolidated Statement of Cash Flows..................................6
         Notes to Consolidated Financial Statements............................7
         Selected Financial Data...............................................9

         Item 2. Management's Discussion and Analysis of Financial Condition
                  and Results of Operations

         Overview.............................................................10
         Results of Operations................................................10
         Liquidity and Interest Rate Sensitivity..............................13
         Earning Assets.......................................................16
         Funding Sources......................................................20
         Capital Resources....................................................20

         Item 3.  Quantitative and Qualitative Disclosure About Market Risk...21

PART II - OTHER INFORMATION
         Item 1.  Legal Proceedings...........................................22

         Item 2.  Changes in Securities ......................................22

         Item 3.  Defaults Upon Senior Securities ............................22

         Item 4.  Submission of Matters to a Vote of Security Holders ........22

         Item 5.  Other Information ..........................................22

         Item 6.  Exhibits and Reports on Form 8-K ...........................22



                                        2

<PAGE>
<TABLE>
                                     PART I
                              FINANCIAL INFORMATION

                   CNB FLORIDA BANCSHARES, INC. AND SUBSIDIARY
                  CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
                                   (Unaudited)
                                                                              September 30,     December 31,
                                                                                  2001            2000
                                                                              -------------     ------------
                                      ASSETS                                             (thousands)
<S>                                                                            <C>                <C>
Cash and cash equivalents:

    Cash and due from banks                                                    $   19,835         $   20,769
    Interest bearing deposits in other banks                                          554                129
                                                                                  -------            -------

      Total cash and cash equivalents                                              20,389             20,898
Investment securities available for sale                                           33,230             33,236
Investment securities held to maturity                                              5,457              7,460
Loans:
    Commercial, financial and agricultural                                        266,233            192,540
    Real estate - mortgage                                                        158,626            120,663
    Real estate - construction                                                     43,404             33,648
    Installment and consumer                                                       40,623             33,970
                                                                                  -------            -------
      Total loans, net of unearned income                                         508,886            380,821
Less: Allowance for loan losses                                                    (4,850)            (3,670)
                                                                                  -------            -------
      Net loans                                                                   504,036            377,151

Premises and equipment, net                                                        26,307             22,433
Intangible assets                                                                   6,671              1,034
Other assets                                                                        5,702              5,381
                                                                                  -------            -------
           TOTAL ASSETS                                                        $  601,792         $  467,593
                                                                                  =======            =======
                                           LIABILITIES AND SHAREHOLDERS' EQUITY

LIABILITIES
Deposits:
    Non-interest bearing demand                                                $   69,539         $   52,082
    Savings, NOW and money market                                                 189,443            129,865
    Time (under $100,000)                                                         155,582            115,406
    Time ($100,000 and over)                                                      108,190             70,333
                                                                                  -------            -------
      Total deposits                                                              522,754            367,686

Securities sold under repurchase agreements and federal funds purchased            15,757             21,142
Short term borrowings                                                              12,000             30,000
Other liabilities                                                                   5,039              4,129
                                                                                  -------            -------
      Total liabilities                                                           555,550            422,957
                                                                                  -------            -------
SHAREHOLDERS' EQUITY
Preferred stock; $.01 par value; 500,000 shares authorized;
    no shares issued or outstanding                                                     -                  -
Common stock; $.01 par value, 10,000,000 shares authorized;
    6,085,077 and 6,099,376 shares issued and outstanding
    at September 30, 2001 and December 31, 2000, respectively                          61                 61
Additional paid-in capital                                                         30,456             30,581
Retained earnings                                                                  15,189             14,027
Accumulated other comprehensive income, net of tax                                    536                (33)
                                                                                  -------            -------
      Total shareholders' equity                                                   46,242             44,636
                                                                                  -------            -------
           TOTAL LIABILITIES AND SHAREHOLDERS'  EQUITY                         $  601,792         $  467,593
                                                                                  =======            =======

                                        3
</TABLE>

<PAGE>
<TABLE>


                   CNB FLORIDA BANCSHARES, INC. AND SUBSIDIARY
                        CONSOLIDATED STATEMENT OF INCOME
                                   (Unaudited)
                                                                             Nine Months Ended September 30,
                                                                                 2001               2000
                                                                             ------------       ------------
                                                                                        (thousands)
<S>                                                                           <C>               <C>
Interest Income
  Interest and fees on loans                                                  $    28,349       $     20,610
  Interest on investment securities available for sale                              1,439              1,593
  Interest on investment securities held to maturity                                  305                444
  Interest on federal funds sold                                                       94                177
  Interest on interest bearing deposits                                                 8                 57
                                                                                ---------          ---------
    Total interest income                                                          30,195             22,881

Interest Expense
  Interest on deposits                                                             13,438              9,172
  Interest on repurchase agreements and federal funds purchased                       480                378
  Interest on short-term borrowings                                                 1,142                568
                                                                                ---------          ---------
    Total interest expense                                                         15,060             10,118
                                                                                ---------          ---------
        Net interest income                                                        15,135             12,763

Provision for Loan Losses                                                           1,450                950
                                                                                ---------          ---------
  Net interest income after provision for loan losses                              13,685             11,813

Non-interest Income
  Service charges                                                                   1,867              1,634
  Secondary marketing mortgage loan sales                                           1,237                196
  Other fees and charges                                                              724                569
                                                                                ---------          ---------
    Total non-interest income                                                       3,828              2,399
                                                                                ---------          ---------

Non-interest Expense
  Salaries and employee benefits                                                    7,507              6,337
  Occupancy and equipment expenses                                                  2,221              1,576
  Other operating expenses                                                          4,590              3,433
                                                                                ---------          ---------
    Total non-interest expense                                                     14,318             11,346
                                                                                ---------          ---------

Income before income taxes                                                          3,195              2,866
    Income taxes                                                                    1,118                990
                                                                                ---------          ---------

NET INCOME                                                                  $       2,077       $      1,876
                                                                                =========          =========


Earnings Per Share (Note 3):

    Basic earnings per share                                                $        0.34       $       0.31
                                                                                =========          =========
    Weighted average shares outstanding                                         6,096,582          6,099,278
                                                                                =========          =========

    Diluted earnings per share                                              $        0.33       $       0.31
                                                                                =========          =========
    Diluted weighted average shares outstanding                                 6,212,878          6,141,743
                                                                                =========          =========


                                        4
</TABLE>

<PAGE>
<TABLE>




                   CNB FLORIDA BANCSHARES, INC. AND SUBSIDIARY
                        CONSOLIDATED STATEMENT OF INCOME
                                   (Unaudited)
                                                                            Three Months Ended September 30,
                                                                                 2001               2000
                                                                            ------------        ------------
                                                                                         (thousands)
<S>                                                                         <C>                 <C>
Interest Income
  Interest and fees on loans                                                $       9,902       $      7,568
  Interest on investment securities available for sale                                460                532
  Interest on investment securities held to maturity                                   90                147
  Interest on federal funds sold                                                       66                 17
  Interest on interest bearing deposits                                                 6                 17
                                                                                ---------          ---------
    Total interest income                                                          10,524              8,281

Interest Expense
  Interest on deposits                                                              4,795              3,336
  Interest on repurchase agreements and federal funds purchased                       121                188
  Interest on short-term borrowings                                                   276                399
                                                                                ---------          ---------
    Total interest expense                                                          5,192              3,923
                                                                                ---------          ---------
        Net interest income                                                         5,332              4,358

Provision for Loan Losses                                                             550                350
                                                                                ---------          ---------
  Net interest income after provision for loan losses                               4,782              4,008

Non-interest Income
  Service charges                                                                     649                575
  Secondary market mortgage loan sales                                                491                110
  Other fees and charges                                                              232                163
                                                                                ---------          ---------
    Total non-interest income                                                       1,372                848
                                                                                ---------          ---------

Non-interest Expense
  Salaries and employee benefits                                                    2,530              2,178
  Occupancy and equipment expenses                                                    825                558
  Other operating expenses                                                          1,842              1,155
                                                                                ---------          ---------
    Total non-interest expense                                                      5,197              3,891
                                                                                ---------          ---------

Income before income taxes                                                            957                965
    Income taxes                                                                      333                333
                                                                                ---------          ---------

NET INCOME                                                                  $         624       $        632
                                                                                =========          =========


Earnings Per Share (Note 3):

    Basic earnings per share                                                $        0.10       $       0.10
                                                                                =========          =========
    Weighted average shares outstanding                                         6,097,248          6,088,137
                                                                                =========          =========

    Diluted earnings per share                                              $        0.10       $       0.10
                                                                                =========          =========
    Diluted weighted average shares outstanding                                 6,210,072          6,125,459
                                                                                =========          =========

                                        5
</TABLE>

<PAGE>
<TABLE>




                   CNB FLORIDA BANCSHARES, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (Unaudited)
                                                                         Nine Months Ended September 30,
                                                                             2001                2000
                                                                         ------------        ------------
                                                                                      (thousands)
<S>                                                                     <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income                                                              $      2,077        $      1,876
Adjustments to reconcile net income to net cash
  provided by operating activities:
     Depreciation and amortization                                             1,408                 832
     Provision for loan loss                                                   1,450                 950
     Investment securities (accretion) amortization, net                          (5)                 14
     Non-cash compensation                                                        17                  44
     Changes in assets and liabilities:
       Other assets                                                             (664)               (610)
       Other liabilities                                                         910                 667
                                                                            ---------           ---------

       Net cash provided by operating activities                               5,193               3,773
                                                                            ---------           ---------

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of investment securities available for sale                        (30,876)               (858)
Proceeds from maturities of securities available for sale                     21,798               3,214
Proceeds from maturities of securities held to maturity                            3                 562
Proceeds from called securities available for sale                            10,000                 489
Proceeds from called securities held to maturity                               1,998                 815
Net increase in loans                                                       (116,099)            (80,569)
Purchases of premises and equipment, net                                      (3,065)             (7,998)
Branches acquired from Republic Bank                                          42,279                   -
                                                                            ---------           ---------

       Net cash used in investing activities                                 (73,962)            (84,345)
                                                                            ---------           ---------

CASH FLOWS FROM FINANCING ACTIVITIES
Increase in deposits                                                          92,702              51,294
Decrease in securities sold under repurchase agreements and
       federal funds purchased                                                (5,385)               (465)
Decrease in short term borrowings                                            (18,000)             35,000
Cash dividends paid                                                             (915)               (917)
Repurchase of common stock                                                      (152)               (395)
Exercise of options                                                               10                  89
                                                                            ---------           ---------
       Net cash provided by financing activities                              68,260              84,606
                                                                            ---------           ---------

Increase (decrease) in cash and cash equivalents                                (509)              4,034

Cash and cash equivalents at beginning of period                              20,898              17,520
                                                                            ---------           ---------

Cash and cash equivalents at end of period                               $    20,389         $    21,554
                                                                            =========           =========

SUPPLEMENTAL DISCLOSURES:
       Interest paid                                                     $    14,041        $      9,329
                                                                            =========           =========

       Taxes paid                                                        $     1,479        $      1,299
                                                                            =========           =========

                                        6
</TABLE>

<PAGE>

                   CNB FLORIDA BANCSHARES, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 2001
                                   (Unaudited)


Note 1. Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance
with the  instructions  to Form 10-Q which do not  require all  information  and
footnotes necessary for a complete  presentation of financial position,  results
of operations and cash flows in conformity  with generally  accepted  accounting
principles. In the opinion of management,  such financial statements reflect all
adjustments  (consisting only of normal recurring  adjustments)  necessary for a
fair  statement  of the  results for the interim  periods  presented.  Operating
results  for the  three  and  nine  months  ended  September  30,  2001  are not
necessarily  indicative  of the results that may be expected for the year ending
December  31,  2001.  Management's  discussion  and  analysis  should be read in
conjunction with the consolidated financial statements.

Note 2. Consolidation
The  consolidated  financial  statements  include  the  accounts  of CNB Florida
Bancshares,  Inc.  and its wholly  owned  subsidiary,  CNB  National  Bank.  All
significant intercompany accounts and transactions have been eliminated.

Note 3.  Earnings Per Share
Basic earnings per share is calculated  based on the weighted  average number of
shares of common stock outstanding during the period. Diluted earnings per share
is  calculated  based on the weighted  average  number of shares of common stock
outstanding  and common  stock  equivalents,  consisting  of  outstanding  stock
options.  Common stock  equivalents are determined using the treasury method for
diluted  shares  outstanding.  The difference  between  diluted and basic shares
outstanding is common stock  equivalents from stock options and restricted stock
outstanding during the periods ended September 30, 2001 and 2000.

Note 4.  Branch Acquisitions
On May 11,  2001,  the Bank  purchased  the Lake City and Live Oak  branches  of
Republic Bank. The Bank acquired loans and deposits of approximately $12 million
and $64 million,  respectively. The Bank also recorded a core deposit intangible
of $6 million, which is being amortized over its estimated life of 10 years.

Note 5.  Comprehensive Income
Comprehensive income is defined as the total of net income and all other changes
in equity.  The following table details the Company's  comprehensive  income for
the three and nine month periods ending September 30, 2001 and 2000.
<TABLE>

                                                            Three Months                      Nine Months
                                                         Ended September 30,              Ended September 30,
                                                         2001           2000              2001           2000
                                                       --------       --------           --------       --------

<S>                                                    <C>            <C>                <C>            <C>
Net Income                                             $    624       $    632           $  2,077       $  1,876
Other Comprehensive Income (Loss), Net of Tax
   Unrealized Gains (Losses) on Securities:
     Unrealized Gains (Losses) on Securities
     Arising During the Period                              151            246                566            279
  Less: Reclassification Adjustment                           -             (2)                (3)             9
                                                           ----           ----              -----          -----
Total Unrealized Gains (Losses), Net of Tax
  Recognized in Other Comprehensive Income                  151            248                569            270
                                                           ----           ----              -----          -----
Comprehensive Income, Net of Tax                       $    775       $    880           $  2,646       $  2,146
                                                           ====           ====              =====          =====
</TABLE>

                                       7
<PAGE>

Note 6.  Recent Accounting Pronouncements
In July 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting  Standards No. 141, Business  Combinations ("SFAS 141").
SFAS 141 requires the purchase  method of accounting  for business  combinations
initiated  after June 30, 2001 and eliminates the  pooling-of-interests  method.
The Company will apply the provisions of SFAS 141 to future acquisitions.

In July 2001, the FASB also issued SFAS No. 142,  Goodwill and Other Intangibles
("SFAS 142").  SFAS 142  requires,  among other things,  the  discontinuance  of
goodwill  amortization  and includes  provisions for  reassessment of the useful
lives of existing  intangibles  and the  identification  of reporting  units for
purposes of assessing  potential future  impairments of goodwill.  SFAS 142 also
requires  the Company to complete a two-step  transitional  goodwill  impairment
test.  The first step of the  impairment  test must be completed six months from
the date of adoption  and the second step must be completed as soon as possible,
but no later than the end of the year of initial  application.  The Company will
be  adopting  the  provisions  of SFAS 142 on January 1,  2002.  Therefore,  the
Company is currently assessing but has not yet determined the impact of SFAS 142
on its financial  position and results of operations.  For the nine months ended
September  30,  2001,  the Company  recorded  goodwill  amortization  expense of
$52,000.

In July 2001,  the SEC  released  Staff  Accounting  Bulletin  ("SAB")  No. 102,
Selected Loan Loss Allowance  Methodology and Documentation  Issues. SAB No. 102
expresses  the  SEC  staff's  views  on  the  development,   documentation   and
application of a systematic methodology in determining a GAAP allowance for loan
losses.  The SAB stresses  that the  methodology  for computing the allowance be
both  disciplined  and  consistent,   and  emphasizes  that  the   documentation
supporting the allowance and provision must be sufficient.  SAB No. 102 provides
guidance that is consistent with the Federal Financial Institutions  Examination
Council's  ("FFIEC"),  Policy  Statement on Allowance  for Loan and Lease Losses
Methodologies and Documentation  for Banks and Savings  Institutions,  which was
also issued in July 2001.  SAB No. 102 is  applicable  to all  registrants  with
material loan portfolios while the parallel  guidance of the FFIEC is applicable
only to banks and savings  institutions.  The adoption of this  bulletin did not
have a material impact on reported results of operations of the Company.


Note 7.  Subsequent Event
On October 1, 2001, the Company  modified its existing line of credit  agreement
with a bank.  The existing  $10 million line of credit was modified  through the
following structures:

         o        $3 million revolving line of credit maturing on June 30, 2002.
                  Interest is variable at 3-month Libor plus 145 basis points.
         o        $10 million term loan  maturing  October 3, 2006.  Interest is
                  variable  at 3-month  Libor plus 170 basis  points.  Quarterly
                  principal   payments   begin   in  2003   based  on  a  7-year
                  amortization schedule.

In addition, the Company entered into a $10 million pay-fixed interest rate swap
with the same bank. The fixed rate under the interest rate swap is 6.45% and the
variable rate is based on 3-month Libor plus 170 basis points.  The swap matures
October 3, 2006 and has been  designated  as a cash flow  hedge of the  variable
interest payments on the $10 million term loan noted above.




                                       8
<PAGE>
<TABLE>


                   CNB FLORIDA BANCSHARES, INC. AND SUBSIDIARY
                             Selected Financial Data

                                                           Nine Months Ended September 30,
                                                           2001                       2000
                                                       ------------               -------------
Dollars in thousands except per share information.
-----------------------------------------------------------------------------------------------------
<S>                                                    <C>                        <C>
SUMMARY OF OPERATIONS:
Total interest income                                  $     30,195               $     22,881
Total interest expense                                      (15,060)                   (10,118)
                                                        -----------                -----------
Net interest income                                          15,135                     12,763
Provision for loan losses                                    (1,450)                      (950)
                                                        ------------               ------------
Net interest income after
      provision for loan losses                              13,685                     11,813
Non-interest income                                           3,828                      2,399
Non-interest expense                                        (14,318)                   (11,346)
                                                        -----------                -----------
Income before taxes                                           3,195                      2,866
Income taxes                                                 (1,118)                      (990)
                                                        -----------                -----------
Net income                                             $      2,077               $      1,876
                                                        ============               ===========

-----------------------------------------------------------------------------------------------------

PER COMMON SHARE:
Basic earnings                                         $       0.34               $       0.31
Diluted earnings                                               0.33                       0.31
Book value                                                     7.61                       7.23
Dividends                                                      0.15                       0.15
Actual shares outstanding                                 6,085,077                  6,091,300
Weighted average shares outstanding                       6,096,582                  6,099,278
Diluted weighted average shares outstanding               6,212,878                  6,141,743

-----------------------------------------------------------------------------------------------------

KEY RATIOS:
Return on average assets                                       0.52%                      0.65%
Return on average shareholders' equity                         6.10                       5.77
Dividend payout                                               44.11                      48.39
Efficiency ratio                                              75.50                      74.83
Total risk-based capital ratio                                 8.94                      13.51
Average shareholders' equity to
  average assets                                               8.47                      11.18
Tier 1 leverage                                                6.66                      10.48

-----------------------------------------------------------------------------------------------------

FINANCIAL CONDITION AT PERIOD-END:
Assets                                                 $    601,792               $    433,540
Loans                                                       508,886                    346,457
Deposits                                                    522,754                    339,497
Shareholders' equity                                         46,242                     44,042

-----------------------------------------------------------------------------------------------------

                                       9
</TABLE>
<PAGE>
           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

OVERVIEW
         The  following   analysis  reviews   important  factors  affecting  the
financial  condition and results of operations of CNB Florida  Bancshares,  Inc.
for  the  nine  months  ended  September  30,  2001  and  2000.  This  financial
information  should  be read in  conjunction  with  the  unaudited  consolidated
financial  statements of CNB Florida  Bancshares,  Inc. ("the  Company") and its
wholly owned  subsidiary,  CNB National Bank ("the Bank"),  included in "Item 1.
Financial  Statements" above and the audited  consolidated  financial statements
included  in Form  10-K for the year  ended  December  31,  2000.  The  analysis
contains  forward-looking  statements  with  respect to  financial  and business
matters,  which are subject to risks and  uncertainties,  that may change over a
period of time.  These  risks and  uncertainties  include but are not limited to
changes in  interest  rates,  variances  in actual  versus  projected  growth in
assets,  loan  losses,  the  ability to control  expenses,  costs of opening new
branches  and  entering  the First Coast and  Gainesville  markets,  competitive
factors and general economic conditions,  changes in government regulation,  the
ability to attract and retain qualified personnel and the ability to attract new
loan and deposit relationships.  Actual results could be significantly different
from the forward-looking statements contained herein. The Company has no foreign
operations;  accordingly,  there are no assets or  liabilities  attributable  to
foreign operations.


RESULTS OF OPERATIONS

         The Company's net income for the nine month period ended  September 30,
2001 was $2.1 million, or $0.33 per diluted share,  compared to $1.9 million, or
$0.31 per diluted  share,  for the nine month period in 2000. Net income for the
three month period ended  September 30, 2001 was $624,000,  or $0.10 per diluted
share,  compared to $632,000,  or $0.10 per diluted  share,  for the  comparable
period in 2000.  Total assets  increased to $601.8 million at September 30, 2001
compared to $433.5  million at September 30, 2000, an increase of 39%.  Included
in the  results  for a portion of the first nine months of 2001 is the impact of
the  acquisition  of the Lake City and Live Oak branches of Republic Bank in May
2001. In connection with the purchase,  the Company  acquired loans and deposits
of approximately $12 million and $64 million, respectively.

Net Interest Income
         Net  interest  income is the single  largest  source of revenue for the
Bank and consists of interest and fee income  generated by earning assets,  less
interest expense paid on interest bearing  liabilities.  Net interest income was
$15.1 million for the nine month period ending  September 30, 2001,  compared to
$12.8 million for the  comparable  period in 2000, an increase of 19%.  Interest
income for the three and nine month periods ended September 30, 2001,  increased
$2.2  million,  or 27%,  and  $7.3  million,  or  32%,  respectively,  over  the
comparable  prior year periods.  Loan growth was the primary  contributor to the
increase in interest income. Interest expense rose $1.3 million, or 32% and $4.9
million,  or 49% for the  three  and nine  months  ending  September  30,  2001,
respectively,  from the comparable 2000 periods.  The increased interest expense
reflects deposit growth,  including those accounts  acquired from Republic Bank,
and  partially  mitigated  the  positive  impact of loan growth on net  interest
income.

          Average loans  increased  $144.6 million or 48% and represented 91% of
total average earning assets for the nine months ended September 30, 2001 versus
86% for 2000.  The Company's loan to deposit ratio at September 30, 2001 was 97%
compared to 104% at December 31, 2000.

         The Company's net interest margin decreased to 4.13% in 2001,  compared
to 4.85% in 2000.  The decline in the margin is reflective of a drop in interest
rates of 400 basis  points  during the first nine months of 2001 coupled with an
increase in average time deposit rates.

         Table 1: "Average  Balances - Yields and Rates"  provides the Company's
average volume of interest earning assets and interest  bearing  liabilities for
the nine months ended September 30, 2001 and 2000. Table 1a presents an analysis
of changes in interest income and expense.

                                       10
<PAGE>
<TABLE>

                  Table 1: Average Balances - Yields and Rates
                                   (Unaudited)


                                                   Nine Months Ended                         Nine Months Ended
                                                   September 30, 2001                        September 30, 2000
                                        -------------------------------------   -----------------------------------
                                                     Interest                               Interest
                                         Average     Income or      Average      Average    Income or     Average
                                         Balance      Expense         Rate       Balance     Expense        Rate
                                        ---------   -----------    ----------   ---------  ----------    ----------
<S>                                    <C>           <C>            <C>       <C>          <C>              <C>

ASSETS:                                                               (dollars in thousands)
  Federal funds sold                   $    3,178    $       94     3.96%     $   3,951    $      177       5.98%
  Investment securities
    available for sale                     32,248         1,439     5.97         33,522         1,593       6.35
  Investment securities
    held to maturity                        6,659           305     6.12         10,212           444       5.81
  Loans (1)                               447,375        28,349     8.47        302,824        20,610       9.09
  Interest bearing deposits                   346             8     3.09          1,148            57       6.63
                                          -------     ---------     ----        -------       -------       ----

TOTAL EARNING ASSETS                      489,806        30,195     8.24        351,657        22,881       8.69
  All other assets                         47,910                                36,749
                                          -------                               -------

TOTAL ASSETS                           $  537,716                             $ 388,406
                                          =======                               =======

LIABILITIES AND
  SHAREHOLDERS' EQUITY:
  NOW and money markets                $  140,193    $    3,018     2.88%     $ 108,650    $    2,698       3.32%
  Savings                                  18,218           158     1.16         17,346           180       1.39
  Time deposits                           224,638        10,262     6.11        146,272         6,294       5.75
  Repurchase agreements and
     federal funds purchased               14,725           480     4.36          8,830           378       5.72
  Short term borrowings                    27,344         1,142     5.58         11,277           568       6.73
                                          -------     ---------     ----        -------       -------       ----
TOTAL INTEREST BEARING
  LIABILITIES                             425,118        15,060     4.74        292,375        10,118       4.62
  Demand deposits                          60,654                                48,759
  Other liabilities                         6,400                                 3,841
  Shareholders' equity                     45,544                                43,431
                                          -------                               -------

TOTAL LIABILITIES AND
  SHAREHOLDERS' EQUITY                 $  537,716                             $ 388,406
                                          =======                               =======

INTEREST SPREAD (2)                                                 3.50%                                   4.07%
                                                                    ====                                    ====
                                                      ---------                               -------
NET INTEREST INCOME                                  $   15,135                            $   12,763
                                                      =========                               =======

NET INTEREST MARGIN (3)                                             4.13%                                   4.85%
                                                                    =====                                   ====

<FN>
(1)  Interest  income on average loans includes loan fee recognition of $804,000
     and $644,000 in 2001 and 2000, respectively.
(2)  Represents the average rate earned minus average rate paid.
(3)  Represents net interest income divided by total earning assets.
</FN>
</TABLE>

                                       11

<PAGE>
<TABLE>
          Table 1a: Analysis of Changes in Interest Income and Expense
                                   (Unaudited)

                                            NET CHANGE SEPTEMBER 30,               NET CHANGE SEPTEMBER 30,
                                            2000-2001 ATTRIBUTABLE TO:             1999-2000 ATTRIBUTABLE TO:
                                            --------------------------             --------------------------
                                                                     Net                                    Net
                                            Volume (1)    Rate (2)  Change         Volume (1)   Rate (2)  Change
                                            ----------    --------  ------         ----------   --------  ------
                                                                          (thousands)
<S>                                          <C>       <C>         <C>              <C>       <C>        <C>
INTEREST INCOME:
   Federal funds sold                        $   (35)  $    (48)   $   (83)         $  (389)  $      36  $   (353)
   Investment securities available for sale      (62)       (92)      (154)            (630)        123      (507)
   Investment securities held to maturity       (155)        16       (139)              65          25        90
   Loans                                       9,810     (2,071)     7,739            6,409         245     6,654
   Interest bearing deposits                     (40)        (9)      ( 49)            (366)         15      (351)
                                               ------    -------     ------          -------     -------   -------
      Total                                    9,518     (2,204)     7,314            5,089         444     5,533
                                               ------    -------     ------          -------     -------   -------

INTEREST EXPENSE:
   NOW and money markets                         781       (461)       320              475       1,011     1,486
   Savings                                         8        (30)       (22)              (1)         (4)       (5)
   Time deposits                               3,363        605      3,968              580         685     1,265
   Repurchase agreements and
     federal funds purchased                     192        (90)       102              103          61       164
   Short term borrowings                         811       (237)       574                -         568       568
                                               ------    -------   --------          -------     -------   -------
      Total                                    5,155       (213)     4,942            1,157       2,321     3,478
                                               ------    -------    -------          -------     -------   -------
         Net interest income                 $ 4,363   $ (1,991)  $  2,372          $ 3,932   $  (1,877) $  2,055
                                               ======    =======    =======          =======     =======   =======
<FN>
(1)  The volume variance reflects the change in the average balance  outstanding
     multiplied by the actual average rate during the prior period.
(2)  The rate variance reflects the change in the actual average rate multiplied
     by the average balance  outstanding during the prior period.  Changes which
     are not solely due to volume  changes  or solely due to rate  changes  have
     been attributed to rate changes.
</FN>
</TABLE>

Non-Interest Income
         Non-interest  income for the nine months ended  September  30, 2001 was
$3.8 million, an increase of $1.4 million, or 60% as compared to the same period
in 2000.  For the three months ended  September  30, 2001,  non-interest  income
increased  $524,000 or 62% to $1.4  million as compared to $848,000 for the same
period in 2000.  Service charges on deposit  accounts  increased to $233,000 for
the nine month  period and $74,000 for the three month period  ending  September
30,  2001 as  compared  to the same  periods in 2000.  Other fee  income,  which
includes credit card fees, credit life insurance income,  safe deposit box fees,
fees from mortgage  loans sold to secondary  markets,  net gains and losses from
sale of securities and other miscellaneous fees, increased $450,000 in the third
quarter of 2001 compared to the third quarter of 2000 and increased $1.2 million
for the first nine  months of 2001  versus the  comparable  period in 2000.  The
increase in other fee income was primarily attributed to growth in mortgage loan
originations sold to secondary loan markets and higher service charge income.

         Non-interest income,  annualized, as a percentage of average assets was
0.95% for the nine months ended  September  30, 2001,  compared to 0.83% for the
comparable period in 2000.

Non-Interest Expense
         Non-interest expense increased in the third quarter of 2001 compared to
the same period in 2000 by $1.3 million or 34%, and $3.0 million, or 26% for the
2001 nine  month  period  versus  the  comparable  period in 2000.  Non-interest
expense, annualized, as a percentage of average assets for the nine month period
ending September 30, 2001 and 2000 was 3.56% and 3.90%, respectively.

                                       12
<PAGE>

          Salaries and employee  benefits  increased $1.2 million or 18% to $7.5
million for the 2001 nine month  period,  compared to $6.3  million for the same
period in 2000.  This  increase  reflects the opening of two new branches in our
First Coast  market,  in addition to the  purchase of the Lake City and Live Oak
branches of Republic Bank.

         Occupancy  expense,   including  premises,   furniture,   fixtures  and
equipment,  increased  $267,000,  or 48% and $645,000,  or 41%,  respectively in
2001, over the comparable  three and nine month periods in 2000. The increase is
primarily  attributable to the increased costs resulting from branch openings in
Jacksonville and St.  Augustine,  the relocation during 2000 into new facilities
in  Jacksonville  and  Gainesville and the expansion of our Lake City Operations
Center.  The Bank also acquired two branches from Republic Bank in May 2001 and,
in connection with that transaction, closed an existing branch in Live Oak.

         Other operating expenses increased $1.2 million,  or 34%, for the first
nine months of 2001  compared to the same period in 2000.  The  following  table
details the areas of significance in other operating expenses.

                              Table 2:  Other Operating Expenses

                                                 Nine Months Ended September 30,
                                                     2001                  2000
                                                 ----------           ----------
                                                           (thousands)
         Data processing                            $ 810                 $ 486
         Advertising and promotion                    437                   474
         Telephone                                    430                   436
         Postage and delivery                         495                   405
         Legal and professional                       324                   335
         Supplies                                     427                   304
         Amortization of intangible assets            339                   135
         Loan expenses                                191                   127
         Regulatory fees                              167                   110
         Administrative                               155                   141
         Insurance and bonding                         80                    60
         Education expense                             78                    32
         Dues and subscriptions                        66                    51
         Directors fees                                56                    60
         Other general operating                       50                    90
         Other                                        485                   187
                                                   ------                ------
         Total other operating expenses            $4,590                $3,433
                                                   ======                ======

Income Taxes
         The  Company's  income  tax  expense in  interim  reporting  periods is
determined by estimating the combined  federal and state  effective tax rate for
the year and  applying  such  rate to  interim  pre-tax  income.  The  Company's
estimated  effective tax rate for the corresponding  quarter and current year is
approximately 35%.

LIQUIDITY AND INTEREST RATE SENSITIVITY

         Liquidity is defined as the ability of the Company to meet  anticipated
demands  for  funds  under  credit  commitments  and  deposit  withdrawals  at a
reasonable cost on a timely basis.  Management  measures the Company's liquidity
position by giving  consideration  to both on- and off-balance  sheet sources of
and demands for funds on a daily and weekly  basis.  These funds can be obtained
by converting  assets to cash or by  attracting  new  deposits.  Average  liquid
assets  (cash and  amounts due from banks,  interest  bearing  deposits in other
banks, federal funds sold and investment  securities available for sale) totaled
$55.1  million and  represented  12% of average total  deposits  during the nine
months of 2001,  compared to $54.8 million and 17% for 2000.  Average loans were
101% and 94% of average  deposits for the nine month period ended  September 30,
2001 and 2000, respectively.

                                       13

<PAGE>

         In addition to core deposit growth, sources of funds available  to meet
liquidity  demands include cash received  through ordinary  business  activities
such as the  collection  of interest  and fees,  federal  funds  sold,  loan and
investment maturities and lines for the purchase of federal funds by the Company
from its principal  correspondent banks. In addition,  the Company has a 364-day
$10  million  line of  credit  with one of its  correspondent  banks,  which was
modified  subsequent  to September  30, 2001 (see Note 7). The Company is also a
member  of the  FHLB  and  has  access  to  short-term  and  long-  term  funds.
Outstanding  borrowings  at September  30, 2001 and 2000 with the FHLB and other
financial institutions were $12.0 million and $3.1 million, respectively.

         Interest   rate   sensitivity   refers   to   the   responsiveness   of
interest-earning  assets and  interest-bearing  liabilities to changes in market
interest rates.  The rate sensitive  position,  or gap, is the difference in the
volume of  rate-sensitive  assets and  liabilities,  at a given  time  interval,
including both floating rate  instruments and instruments  which are approaching
maturity.   Management   generally   attempts  to  maintain  a  balance  between
rate-sensitive  assets and  liabilities as the exposure  period is lengthened to
minimize the overall interest rate risk to the Company.

         The  Company's  gap and  liquidity  positions are reviewed on a regular
basis by  management  to  determine  whether  or not  changes  in  policies  and
procedures are necessary to achieve  financial goals.  Included in the review is
an internal  analysis of the possible impact of changes in interest rates on net
interest income.

         In Table 3, "Rate  Sensitivity  Analysis",  rate  sensitive  assets and
liabilities  are  shown,  separating  fixed and  variable  interest  rates.  The
estimated  fair value of each  instrument  category  is also shown in the table.
While  these  fair  values  are  based  on  management's  judgment  of the  most
appropriate  factors,  there is no  assurance  that,  were the  Company  to have
disposed of such  instruments  at September 30, 2001,  the estimated fair values
would  necessarily  have been  achieved at that date,  since  market  values may
differ depending on various circumstances.
















                                       14

<PAGE>
<TABLE>

Table 3: Rate Sensitivity Analysis
September 30, 2001
(dollars in thousands)
                                                                                                                    Fair
                                     1 Year     2 Years    3 Years    4 Years    5 Years    Beyond      TOTAL       Value
                                     ------     -------    -------    -------    -------    ------      -----       -----
<S>                                  <C>        <C>        <C>        <C>        <C>        <C>
INTEREST-EARNING ASSETS:

Investment securities (1)
     Fixed rate investments        $   4,541  $       -  $  18,137  $   4,100  $   5,457  $     684  $  32,919  $  33,638
       Average interest rate           3.81%                 5.63%      5.36%      6.15%      5.39%      5.43%

     Variable rate investments             -          -          -          -          -      1,071      1,071      1,086
       Average interest rate                                                                  6.40%      6.40%

Loans
     Fixed rate loans                 57,265     34,882     35,835     31,405     30,614     66,963    256,964    253,536
       Average interest rate           8.53%      8.85%      8.69%      8.79%      8.56%      7.92%      8.47%

     Variable rate loans              76,521     28,368     25,005     16,966     13,850     91,212    251,922    251,922
       Average interest rate           6.67%      6.43%      6.81%      6.94%      6.85%      7.80%      7.09%

Other earning assets (2)               4,395          -          -          -          -          -      4,395      4,517
       Average interest rate           5.84%                                                             5.84%
                                     -------     ------     ------     ------     ------    -------    -------    -------

Total interest-earning assets      $ 142,722  $  63,250  $  78,977  $  52,471  $  49,921  $ 159,930  $ 547,271  $ 544,699
       Average interest rate           7.30%      7.76%      7.39%      7.92%      7.82%      7.83%      7.63%
                                     =======     ======     ======     ======     ======    =======    =======    =======

INTEREST-BEARING LIABILITIES:

Savings                            $       -  $       -  $       -  $       -  $       -  $  19,836  $  19,836  $  19,836
       Average interest rate                                                                  1.00%      1.00%

NOW                                   35,488          -          -          -          -     67,342    102,830    102,830
       Average interest rate           3.24%                                                 0.76%      1.62%

Money market (3)                      62,565          -          -          -          -      4,212     66,777     66,777
       Average interest rate           3.82%                                                  2.00%      3.71%

CD's under $100,000                  135,858     11,692      3,667      4,365          -          -    155,582    154,490
       Average interest rate           5.21%      5.21%      4.91%      4.84%                            5.19%

CD's $100,000 and over                97,524      6,657      1,938      1,955        116          -    108,190    107,418
       Average interest rate           5.60%      5.61%      4.80%      4.74%      6.55%                5.57%

Securities sold under
   repurchase agreements and
   federal funds purchased            15,757          -          -          -          -          -     15,757     15,757
       Average interest rate           2.37%                                                             2.37%

Short term borrowings                 12,000          -          -          -          -          -     12,000     12,000
       Average interest rate           4.02%                                                             4.02%
                                    --------    -------    -------    -------    -------    -------    -------    -------

Total interest-bearing liabilities $ 359,192  $  18,349  $   5,605  $   6,320  $     116  $  91,390  $ 480,972  $ 479,108
       Average interest rate           4.71%      5.36%      4.87%      4.81%      6.55%      0.87%      4.01%
                                     =======    =======    =======    =======    =======    =======    =======    =======

<FN>
(1)  Securities  available for sale are shown at their amortized cost, excluding
     market value adjustment for unrealized gains of $856,000.
(2)  Represents interest bearing deposits with other banks, Federal Reserve Bank
     Stock, Federal Home Loan Bank Stock and other marketable equity securities.
(3)  All Money Market accounts $25,000 and over and 30% of Money Market accounts
     under $25,000 have been designated as maturing within one year.
</FN>
</TABLE>
                                       15

<PAGE>

        Core deposits,  which represent all deposits other than time deposits in
excess of $100,000,  were 79% of total deposits at September 30, 2001 and 81% at
December 31, 2000.  The Bank closely  monitors its reliance on time  deposits in
excess of $100,000, which are generally considered less stable and less reliable
than core deposits. Table 4, below, sets forth the amounts of time deposits with
balances of $100,000 or more that mature within indicated periods. The Bank does
not nor has it ever solicited brokered deposits.

             Table 4: Maturity of Time Deposits of $100,000 or More
                               September 30, 2001
                             (dollars in thousands)

                                                                    Amount

             Three months or less                                 $ 28,416
             Three through six months                               28,340
             Six through twelve months                              40,768
             Over twelve months                                     10,666
                                                                   -------
             Total                                                $108,190
                                                                   =======


EARNING ASSETS

Loans
         During the nine month period ending  September 30, 2001,  average loans
were  $447.4  million  and were 101% of  average  deposits,  compared  to $302.8
million and 94% for 2000. Total loans have increased by $128.1 million,  or 34%,
since December 31, 2000. Loan growth has occurred in all of the portfolios, with
the most significant  increase in commercial,  financial and agricultural  loans
and real estate-  mortgage loans.  Average loans as a percent of average earning
assets increased to 91% for the nine months ending September 30, 2001,  compared
to 86% for the  comparable  period in 2000.  The  following  table  reflects the
composition of the Company's loan portfolio as of September 30, 2001 compared to
December 31, 2000.

                       Table 5: Loan Portfolio Composition

                                               September 30,      December 31,
                                                   2001               2000
                                             --------------      --------------
                                                         (thousands)
 Commercial, financial and agricultural       $    266,233      $    192,540
 Real estate - mortgage                            158,626           120,663
 Real estate - construction                         43,404            33,648
 Installment and consumer                           40,623            33,970
                                                   -------           -------

 Total loans, net of unearned income               508,886           380,821
 Less: allowance for loan losses                    (4,850)           (3,670)
                                                   -------           -------

 Net loans                                    $    504,036      $    377,151
                                                   =======           =======


Loan Quality
          The  allowance  for loan losses  represents  a reserve  for  potential
losses in the loan  portfolio.  On an  ongoing  basis,  management  attempts  to
maintain  the  allowance  for loan  losses at levels  sufficient  to provide for
losses  inherent  in the  loan  portfolio.  The  allowance  for loan  losses  is
established  through a provision charged to expense. In determining the adequacy
of the reserve for loan losses,  management considers those levels maintained by
other  peer  banks,  conditions  of  the  individual  borrowers,  the  Company's
historical loan loss experience and the general economic environment, as well as

                                       16

<PAGE>


the overall portfolio composition.  Loans are charged against the allowance when
it is recognized that collection of the principal is unlikely. The allowance for
loan losses on September 30, 2001 was 0.95% of total loans, compared to 0.96% on
December 31, 2000. Table 6: "Allocation of Allowance for Loan Losses", set forth
below, indicates the specific reserves allocated by loan type.

                Table 6: Allocation of Allowance for Loan Losses


                                     September 30,            December, 31
                                            2001                   2000
                             -------------------------   -----------------------
                                         Percent of                  Percent of
                                        Loans in Each              Loans in Each
                                          Category to                Category to
                              Amount     Total Loans      Amount    Total Loans
                             --------   -------------    --------  -------------
                                            (dollars in thousands)
 Commercial, financial
    and agricultural         $  3,297         52%        $ 2,607         50%
 Real estate - mortgage           421         31%            293         32%
 Real estate - construction        22          9%             15          9%
 Consumer                         948          8%            734          9%
 Unallocated                      162          -              21          -
                                -----        ----         ------        ----
 Total                       $  4,850        100%        $ 3,670        100%
                                =====        ====         ======        ====


         Total  non-performing  assets  increased  by  $708,000  or 48% to  $2.2
million on September  30,  2001,  compared to $1.5 million on December 31, 2000.
Non-performing  assets as a  percentage  of total  assets  increased to 0.36% on
September  30,  2001 from 0.32% on December  31,  2000.  Non-accrual  loans have
increased $1.2 million since  December 31, 2000.  This increase is primarily due
to four commercial real estate loans filing bankruptcy or going to foreclosure.

                         Table 7: Non-Performing Assets

                                                September 30,       December 31,
                                                    2001                2000
                                                 ----------          ----------
                                                     (dollars in thousands)
  Non-accrual loans                             $      1,781        $    579
  Past due loans 90 days or
    more and still accruing                              241             840
  Other real estate owned
    and repossessions                                    161              56
                                                      ------         -------
  Total non-performing assets                   $      2,183        $  1,475
                                                      ======          ======

  Percent of total assets                               0.36%           0.32%

         The determination of the reserve level rests upon management's judgment
about  factors  affecting  loan  quality  and  assumptions  about  the  economy.
Management considers the period-end allowance  appropriate and adequate to cover
inherent losses in the loan portfolio;  however,  management's judgment is based
upon a number of  assumptions  about  future  events,  which are  believed to be
reasonable,  but which may or may not prove to be valid.  Thus,  there can be no
assurance  that  charge-offs in future periods will not exceed the allowance for
loan losses or that  additional  increases in the allowance for loan losses will
not be  required.  Table 8:  "Activity  in Allowance  for Loan  Losses",  below,
indicates  activity in the  allowance  for loan losses for the nine month period
ending September 30, 2001 and 2000.


                                       17

<PAGE>
<TABLE>

                 Table 8: Activity in Allowance for Loan Losses
                                                                         September 30,
                                                                   2001                 2000
                                                                ---------            ---------
                                                                     (dollars in thousands)

<S>                                                            <C>                   <C>
 Balance at beginning of year                                  $    3,670            $    2,671
 Allowance acquired by acquisition                                    110                     -
 Loans charged-off:
    Commercial, financial and agricultural                            272                    64
    Real estate, mortgage                                              46                    40
    Real estate, construction                                           -                     -
    Consumer                                                          288                   239
                                                                   ------                ------
       Total loans charged-off                                       (606)                 (343)
 Recoveries on loans previously charged-off:
    Commercial, financial and agricultural                            107                    25
    Real estate, mortgage                                              21                     -
    Real estate, construction                                           -                     -
    Consumer                                                           98                   122
                                                                   ------                ------
       Total loan recoveries                                          226                   147
                                                                   ------                ------
         Net loans charged-off                                       (380)                 (196)
                                                                   ------                ------

 Provision for loan losses charged to expense                       1,450                   950
                                                                   ------                ------
 Ending balance                                                $    4,850            $    3,425
                                                                   ======                ======

 Total loans outstanding                                       $  508,886            $  346,457
 Average loans outstanding                                     $  447,375            $  302,824

 Allowance for loan losses to loans outstanding                     0.95%                 0.99%
 Net charge-offs to average loans outstanding, annualized           0.11%                 0.09%
</TABLE>


Investment Portfolio
         The Company  uses its  securities  portfolio  to assist in  maintaining
proper interest rate sensitivity in the balance sheet, to provide  securities to
pledge as collateral for public funds and repurchase agreements,  and to provide
an  alternative  investment  for available  funds.  The total  recorded value of
securities  was $38.7 million at September 30, 2001, a decrease of 5% from $40.7
million at the end of 2000.

           Securities   are   classified   as   either    held-to-maturity    or
available-for-sale  which are recorded at amortized  cost and fair market value,
respectively.  Securities  available-for-sale,  which  made up 86% of the  total
investment  portfolio  as of  September  30, 2001 had a value of $33.2  million.
Securities in the available-for-sale portfolio are recorded at fair value on the
balance sheet and unrealized  gains and losses  associated with these securities
are recorded,  net of tax, as a separate  component of shareholders'  equity. At
September  30, 2001,  shareholders'  equity  recorded a net  unrealized  gain of
$536,000, compared to a $33,000 net unrealized loss at December 31, 2000.

         The  Company  invests  primarily  in direct  obligations  of the United
States,  obligations  guaranteed  as to the principal and interest by the United
States and  obligations  of  agencies of the United  States.  In  addition,  the
Company enters into federal funds transactions with its principal  correspondent
banks.  The Federal  Reserve Bank and Federal Home Loan Bank also require equity
investments to be maintained by the Company.

         The  following  tables  set forth  the  maturity  distribution  and the
weighted average yields of the Company's investment portfolio.


                                       18

<PAGE>
<TABLE>
           Table 9: Maturity Distribution of Investment Securities (1)
                               September 30, 2001

(dollars in thousands)                         Held to Maturity                       Available for Sale
-------------------------------------------------------------------------------------------------------------------

                                           Amortized       Estimated              Amortized       Estimated
                                                Cost      Market Value                 Cost      Market Value
<S>                                      <C>              <C>                   <C>              <C>
U.S. Treasury:
   One year or less                      $          -   $            -          $        1,500   $      1,500
                                          -----------      -----------                 -------        -------
  Total U.S. Treasury                               -                -                   1,500          1,500

 U.S. Government Agencies
 and Corporations:
   One year or less                                 -                -                   2,951          2,942
   Over one through five years                  5,457            5,454                  22,000         22,683
                                           ----------       ----------                 -------        -------
Total U.S. Government Agencies                  5,457            5,454                  24,951         25,625
 and Corporations

Obligations of State and Political
 Subdivisions:
   One year or less                                 -                -                      90             91
   Over one through five years                      -                -                     237            242
   Over ten years                                   -                -                     608             648
                                           ----------       ----------                 -------        ---------
Total Obligations of State and                      -                -                     935            981
 Political Subdivisions

Mortgage-Backed Securities (2):
   Over five through ten years                      -                -                     230            233
   Over ten years                                   -                -                     917             931
                                           ----------       ----------                 -------        -------
Total Mortgage-Backed Securities                    -                -                   1,147          1,164

Other Securities:
   Over ten years (3)                               -                -                   3,840           3,960
                                           ----------       ----------                 -------        -------
Total Other Securities                              -                -                   3,840          3,960

Total Securities                         $      5,457     $      5,454            $     32,373   $     33,230
                                           ==========       ==========                 =======        =======

<FN>
(1)  All securities,  excluding Obligations of State and Political Subdivisions,
     are taxable.
(2)  Represents  investments in mortgage-backed  securities which are subject to
     early repayment.
(3)  Represents  investment  in Federal  Reserve Bank and Federal Home Loan Bank
     stock and other marketable equity securities.
</FN>
</TABLE>
<TABLE>

             Table 10: Weighted Average Yield by Range of Maturities
                                               September 30, 2001     December 31, 2000     September 30, 2000
                                               ------------------     -----------------     ------------------
<S>                                                  <C>                   <C>                    <C>
           One Year or Less                          2.56%                 6.49%                  6.24%
           Over One through Five Years               5.39%                 6.00%                  6.00%
           Over Five through Ten Years               6.06%                 6.18%                  6.18%
           Over Ten Years (1)                        6.34%                 6.45%                  6.36%

<FN>
           (1) Represents  adjustable rate mortgage-backed  securities which are
               repriceable within one year.
</FN>
</TABLE>
                                       19

<PAGE>

Other Earning Assets

         Temporary  investment  needs are  created in the  day-to-day  liquidity
movement of the Bank and are satisfied by selling  excess funds  overnight  (Fed
Funds Sold) to larger,  well capitalized  banking  institutions.  If these funds
become excessive,  management  determines what portion, if any, of the liquidity
may be rolled into longer term investments as securities.


FUNDING SOURCES

Deposits
         The Bank does not rely on purchased or brokered deposits as a source of
funds.  Instead,  competing  for  deposits  within its market area serves as the
Bank's  fundamental tool in providing a source of funds to be invested primarily
in loans.  The following  table sets forth certain  deposit  categories  for the
periods ended September 30, 2001 and December 31, 2000.

                            Table 11: Total Deposits

                                          September 30,     December 31,
                                              2001              2000
                                          -----------       ------------
                                                    (thousands)
   Non-interest bearing:
           Demand checking                $    69,539       $     52,082
   Interest bearing:
           NOW checking                       102,830             74,589
           Money market checking               66,777             38,797
           Savings                             19,836             16,479
           Certificates of deposit            263,772            185,739
                                             --------           --------

   Total deposits                         $   522,754       $    367,686
                                             ========           ========



CAPITAL RESOURCES

         Shareholders'  equity  at  September  30,  2001 was $46.2  million,  as
compared to $44.6  million at December 31,  2000.  At  September  30, 2001,  the
Company's common stock had a book value of $7.61 per share compared to $7.32 per
share at December 31, 2000.

         The Company is subject to various capital requirements  administered by
the federal banking  agencies.  Under capital adequacy  guidelines,  the Company
must meet specific capital guidelines that involve quantitative  measures of its
assets,  liabilities,  and certain  off-balance  sheet items as calculated under
regulatory  accounting  practices.  Capital amounts and  classification are also
subject  to  qualitative  judgements  by the  regulators  about  component  risk
weightings and other factors.

         Quantitative  measures  as defined by  regulation  and  established  to
ensure capital  adequacy require the Bank to maintain minimum amounts and ratios
of Total and Tier 1  capital  to  risk-weighted  assets  and Tier 1  capital  to
average  assets.  If such  minimum  amounts  and  ratios  are  met,  the Bank is
considered  "adequately  capitalized."  If a bank  exceeds the  requirements  of
"adequately  capitalized" and meets even more stringent minimum standards, it is
considered to be "well  capitalized." As of September 30, 2001, the Bank met all
capital adequacy requirements to which it is subject.

         Selected capital ratios at September 30, 2001 compared to September 31,
2000 and regulatory requirements are as follows:

                                       20

<PAGE>
<TABLE>

                            Table 12: Capital Ratios


                                    September 30,     September 30,      Well Capitalized    Regulatory
                                        2001              2000            Requirements        Minimums
                                    ------------      ------------        ------------        --------
<S>                                    <C>               <C>                 <C>                <C>
Risk Based Capital Ratios:
     Tier 1 Capital Ratio
         Consolidated                  8.0%              12.5%               6.0%               4.0%
         Bank                          9.3%               9.9%               6.0%               4.0%

     Total Capital to
       Risk-Weighted Assets
         Consolidated                  8.9%              13.5%              10.0%               8.0%
         Bank                         10.3%              10.9%              10.0%               8.0%

Tier 1 Leverage Ratio
         Consolidated                  6.7%              10.5%               5.0%               4.0%
         Bank                          7.8%               8.5%               5.0%               4.0%

</TABLE>


            QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

         On January 28, 1997,  the Securities  and Exchange  Commission  adopted
amendments to Regulation S-K,  Regulation S-X, and various forms (Securities Act
Release No. 7386) to clarify and expand  existing  requirements  for disclosures
about  derivatives  and market risks inherent in derivatives and other financial
instruments.  No derivative  financial  instruments  were held by the Company at
September 30, 2001 (the Company entered into an interest rate swap on October 3,
2001,  as more  fully  described  in Note 7 of Item  1.),  but  other  financial
instruments,   which  include  investments,  loans  ,  deposit  liabilities  and
borrowings  are included in the Company's  balance sheet.  The release  requires
quantitative and qualitative  disclosures  about market risk. See section titled
"Liquidity  and  Interest  Rate  Sensitivity"  for  further  discussion  on  the
Company's management of interest rate risk.

         Financial  instruments  that have market risk are  included in Table 3:
"Rate Sensitivity Analysis". These instruments are shown, separated by fixed and
variable interest rates. The estimated fair value of each instrument category is
also shown in the  table.  While  these  estimates  of fair  values are based on
management's  judgement of the most appropriate  factors,  there is no assurance
that,  were the Company to have  disposed of such  instruments  at September 30,
2001,  the estimated  fair values would  necessarily  have been achieved at that
date,  since market values may differ  depending on various  circumstances.  The
estimated fair values at September 30, 2001 would not  necessarily be considered
to apply at subsequent dates.


                                       21

<PAGE>


                                     PART II
                                OTHER INFORMATION

         Item 1.  Legal  Proceedings  - There are no material  pending  legal
                  proceedings to which the Company or any of its subsidiaries is
                  a party or of which any of their property is the subject.

         Item 2.  Changes in Securities - Not applicable.

         Item 3.  Defaults Upon Senior Securities - Not applicable.

         Item 4.  Submission  of  Matters  to a Vote of  Security  Holders - Not
                  applicable.

         Item 5.  Other Information - Not applicable.

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

         (a)      Exhibits:

                  None.

         (b)      Form 8-K:

                  None.





                                       22

<PAGE>

                                   SIGNATURES



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



                                             CNB Florida Bancshares, Inc.
                                          --------------------------------
                                                        (Registrant)


                                         By:     /s/ G. Thomas Frankland
                                                 --------------------------
                                                 G. Thomas Frankland
                                                 Executive Vice President
                                                 and Chief Financial Officer

                                         Date:   November 9, 2001



















                                       23