UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
            ---------------------------------------------------------

                                   FORM 10-QSB

                      QUARTERLY REPORT UNDER SECTION 13 OR
                        15(d) OF THE SECURITIES EXCHANGE
                                   ACT OF 1934

                  For the Quarterly Period Ended June 30, 2000
                        Commission File Number 000-26145

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

                         CITRUS FINANCIAL SERVICES, INC.
             (Exact Name of registrant as specified in its charter)

Florida                                                      65-0136504
-------                                                      ----------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                               Identification No.)

1717 Indian River Boulevard
Suite 100
Vero Beach, Florida                                          32960
-------------------                                          -----
(Address of Principal Executive Offices)                     (Zip Code)

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

                                 (561) 778-4100
               (Registrant's telephone number including area code)

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

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.
Yes   X                    No _____.
    -----

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
Common stock as of the latest practicable date:

     Class                                      Outstanding as of August 3, 2000
---------------                                 --------------------------------
Common Stock                                                1,423,392
Par Value $3.15 per share (rounded)



<PAGE>









                         CITRUS FINANCIAL SERVICES, INC.

                                      INDEX

                                                                          PAGE
                                                                         NUMBER

REPORT OF INDEPENDENT ACCOUNTANTS                                            3

PART I:  FINANCIAL INFORMATION

       Item 1: Financial Statements:

               Consolidated Condensed Balance Sheets as of June 30, 2000
               (Unaudited) and December 31, 1999                             4

               Consolidated Statements of Operations and Comprehensive
               Income for the Three and Six Months Ended June 30, 2000
               and 1999 (Unaudited)                                          5

               Consolidated Condensed Statements of Cash Flows for the
               Three and Six Months Ended June 30, 2000 and 1999 (Unaudited) 6

               Consolidated Statement of Changes in Stockholders' Equity
               (Unaudited)                                                   7

               Notes to Consolidated Financial Statements (Unaudited)        8

       Item 2: Management's Discussion and Analysis of Financial Condition
               and Results of Operations                                    12

PART II:       OTHER INFORMATION                                            22

Signatures                                                                  23




<PAGE>










                        REPORT OF INDEPENDENT ACCOUNTANTS




To the Audit Committee
Citrus Financial Services, Inc. and Subsidiary
Vero Beach, Florida

We have  reviewed the  accompanying  consolidated  condensed  balance  sheets of
Citrus Financial  Services,  Inc., and its wholly-owned  subsidiary  ("Citrus"),
Citrus  Bank,  N.A.  ("Citrus  Bank"),  as of June  30,  2000,  and the  related
consolidated  statements of operations and comprehensive income and consolidated
condensed  statements  of cash flows for the three and six months  periods ended
June 30, 2000 and 1999,  and the related  consolidated  statement  of changes in
stockholders'  equity  for the six months  period  ended  June 30,  2000.  These
consolidated financial statements are the responsibility of Citrus' management.

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

Based  upon our  review,  we are not aware of any  material  modifications  that
should be made to the consolidated  financial  statements  referred to above for
them to be in conformity with generally accepted accounting principles.

We previously audited, in accordance with generally accepted auditing standards,
the  consolidated  balance  sheet  as of  December  31,  1999,  and the  related
consolidated  statements of operations and comprehensive income, cash flows, and
changes in stockholders'  equity for the year then ended (not presented herein);
and in our report dated January 21, 2000, we expressed an unqualified opinion on
those consolidated  financial  statements.  In our opinion,  the information set
forth in the accompanying  consolidated  condensed  balance sheet as of December
31,  1999,  is fairly  stated,  in all  material  respects,  in  relation to the
consolidated balance sheet from which it has been derived.



STEVENS, SPARKS & COMPANY, P.A.
Jacksonville, Florida
August 3, 2000











                                      - 3 -





<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY
                      CONSOLIDATED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                          June 30, 2000
                                                           (Unaudited)     December 31, 1999
                                                          -------------    -----------------
                                                         (In Thousands, Except Per Share Data)
<S>                                                         <C>                <C>

ASSETS
Cash and due from banks                                     $     2,428        $     4,040
Federal funds sold                                                2,000              3,550
                                                            -----------        -----------
     Total cash and cash equivalents                              4,428              7,590
Interest-bearing deposits in other banks                            360                 32
Securities available-for-sale at fair value                       8,542              5,636
Securities held-to-maturity (market value of
    $632 for 2000 and $953 for 1999)                                695              1,039
Loans held for investment less allowance for credit losses       72,443             67,349
Loans held for sale                                                 599              1,963
Facilities                                                        2,685              2,802
Other real estate owned                                              88               --
Other assets                                                      1,694              1,648
                                                            -----------        -----------

         TOTAL                                              $    91,534        $    88,059
                                                            ===========        ===========


LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
     Noninterest-bearing                                    $    11,275        $    12,092
     NOW accounts                                                 3,412              4,639
     Money market accounts                                        3,869              4,287
     Savings accounts                                             7,789              9,105
     Time, $100,000 and over                                     11,018              9,747
     Other time deposits                                         44,390             39,221
                                                            -----------        -----------

         Total deposits                                          81,753             79,091

Other borrowings                                                    142                237
Accounts payable and accrued liabilities                            433                364
                                                            -----------        -----------

         Total liabilities                                       82,328             79,692
                                                            -----------        -----------

Commitments and contingencies                                      --                 --
                                                            -----------        -----------

Stockholders' equity:
     Preferred stock                                               --                 --
     Common stock                                                 4,491              4,125
     Additional paid-in capital                                   4,638              4,271
     Retained earnings                                              163                 47
     Accumulated other comprehensive income
         Net unrealized holding losses on securities                (86)               (76)
                                                            -----------        -----------

         Total stockholders' equity                               9,206              8,367
                                                            -----------        -----------

         TOTAL                                              $    91,534        $    88,059
                                                            ===========        ===========

Book value per common share                                 $      6.47        $      6.40
                                                            ===========        ===========

Common shares outstanding                                     1,423,392          1,307,167
                                                            ===========        ===========
</TABLE>






          See accompanying notes to consolidated financial statements.

                                      - 4 -


<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY
   CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED)
<TABLE>
<CAPTION>

                                                    For the Three Months Ended June 30,For the Six Months Ended June 30,
                                                    --------------------------------------------------------------------
                                                                  2000        1999      2000       1999
                                                                  ----        ----      ----       ----
                                                              (Dollars in Thousands, Except Per Share Data)
<S>                                                              <C>        <C>        <C>        <C>

Interest and fees on loans held for investment                   $ 1,639    $ 1,307    $ 3,198    $ 2,518
Interest and fees on loans held for sale                              13        147         44        324
Investment income on investment securities
   and interest-bearing deposits in other banks                      118         83        213        161
Federal funds sold                                                    58         49        121        151
                                                                 -------    -------    -------    -------
         Total interest income                                     1,828      1,586      3,576      3,154
                                                                 -------    -------    -------    -------

Interest on deposits                                                 880        645      1,660      1,361
Other                                                                  2         17          5         20
                                                                 -------    -------    -------    -------
         Total interest expense                                      882        662      1,665      1,381
                                                                 -------    -------    -------    -------

         Net interest income before provision
              for credit losses                                      946        924      1,911      1,773
                                                                 -------    -------    -------    -------

Provision for credit losses                                           51         (2)       125         20
                                                                 -------    -------    -------    -------

         Net interest income                                         895        926      1,786      1,753
                                                                 -------    -------    -------    -------

Fees and service charges                                              98        113        201        220
Other income                                                           6         10         13         17
                                                                 -------    -------    -------    -------
         Total other income                                          104        123        214        237
                                                                 -------    -------    -------    -------

Other expenses:
   Salaries and employee benefits                                    458        445        930        833
   Expenses of bank premises and fixed assets                        186        162        362        303
   Other operating expenses                                          261        245        524        461
                                                                 -------    -------    -------    -------
         Total other expenses                                        905        852      1,816      1,597
                                                                 -------    -------    -------    -------

Income before provision for income taxes                              94        197        184        393

Provision for income taxes                                            35         74         68        148
                                                                 -------    -------    -------    -------

Net income                                                            59        123        116        245

Other comprehensive income, net of income taxes:
   Unrealized holding gains (losses) arising during period             3        (19)       (10)       (17)
   Less: reclassification adjustments for gains included in
         net income for the period                                  --           (2)      --           (2)
                                                                 -------    -------    -------    -------
         Total other comprehensive income,
            net of income taxes                                        3        (21)       (10)       (19)
                                                                 -------    -------    -------    -------

Comprehensive income                                             $    62    $   102    $   106    $   226
                                                                 =======    =======    =======    =======


Earnings Per Share Information
     Primary                                                     $  0.04    $  0.13    $  0.08   $  0.26
                                                                 =======    =======    =======   =======
     Fully diluted                                               $  0.04    $  0.10    $  0.08   $  0.21
                                                                 =======    =======    =======   =======

</TABLE>


          See accompanying notes to consolidated financial statements.

                                      - 5 -


<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY
           CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)

<TABLE>
<CAPTION>
                                                                For the Three Months Ended June 30,For the Six Months Ended June 30,
                                                                ---------------------------------- ---------------------------------
                                                                          2000          1999           2000          1999
                                                                          ----          ----           ----          ----
                                                                           (Dollars in Thousands)
<S>                                                                     <C>           <C>           <C>           <C>

Net income                                                              $     59      $    123      $    116      $    245
Adjustments to reconcile net income to net cash
      provided (used) by operating activities:
         Provision for credit losses                                          51            (2)          125            20
         Depreciation and amortization                                        90            89           180           168
         Net premium amortization and discount accretion                      16             5            10            10
         (Increase) decrease in other assets                                 508          (154)          628          (525)
         Increase (decrease) in other liabilities                             90          (403)           69          (374)
         Origination of loans held for sale                               (4,513)      (31,831)      (11,690)      (62,389)
         Proceeds on sale of loans held for sale                           4,833        33,579        13,054        66,994
                                                                        --------      --------      --------      --------

              Net cash provided by operating activities                    1,134         1,406         2,492         4,149
                                                                        --------      --------      --------      --------

Cash flows from investing activities: Net (increase) decrease in:
         Investment securities                                            (2,734)       (1,181)       (2,586)         (976)
         Interest-bearing deposits in other banks                           (294)           22          (328)            8
         Loans                                                              (583)       (3,111)       (5,244)       (5,867)
     Purchases of bank premises and equipment, net                            34           (67)          (63)         (178)
                                                                        --------      --------      --------      --------

              Net cash used by investing activities                       (3,577)       (4,337)       (8,221)       (7,013)
                                                                        --------      --------      --------      --------

Cash flows from financing activities:
     Net increase (decrease) in deposits                                       2        (3,756)        2,662        (8,456)
     Repayments of FHLB advances, net                                        (12)        5,758           (95)        5,745
                                                                        --------      --------      --------      --------

              Net cash provided (used) by
                financing activities                                         (10)        2,002         2,567        (2,711)
                                                                        --------      --------      --------      --------

Decrease in cash and cash equivalents                                     (2,453)         (929)       (3,162)       (5,575)

Cash and cash equivalents at beginning of period                           6,881         8,494         7,590        13,140
                                                                        --------      --------      --------      --------

Cash and cash equivalents at end of period                              $  4,428      $  7,565      $  4,428      $  7,565
                                                                        ========      ========      ========      ========

</TABLE>















          See accompanying notes to consolidated financial statements.

                                      - 6 -



<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY
      CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED)

<TABLE>
<CAPTION>


                                                                                                   Net
                                                      Common Stock                              Unrealized
                                           ---------------------------------                      Holding
                                                          Par             Additional               Gains          Total
                                                         Value             Paid-in    Retained  (Losses) on    Stockholders'
                                              Shares   (Rounded)   Amount  Capital    Earnings   Securities       Equity
                                           ----------- ---------  -------  ---------  --------  ------------------------------------
                                                              (Dollars in Thousands, Except Par Value Per Share)
<S>                                         <C>         <C>       <C>       <C>       <C>         <C>          <C>

Balance, December 31, 1999                  1,307,167   $   3.15  $ 4,125   $  4,271  $    47   $     (76)     $   8,367

Stock options/warrants exercised              116,225        --       366        367      --          --             733

Comprehensive income:
   Net income                                    --          --       --         --       116         --
   Net change in unrealized holding
     gains on securities                         --          --       --         --       --          (10)

     Total comprehensive income                  --          --       --         --       --          --             106
                                            ---------   --------  -------   --------  -------   ---------      ---------

Balance, June 30, 2000                      1,423,392   $   3.15  $ 4,491   $  4,638  $   163   $     (86)     $   9,206
                                            =========   ========  =======   ========  =======   =========      =========


</TABLE>
































          See accompanying notes to consolidated financial statements.

                                      - 7 -


<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                  JUNE 30, 2000


NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES

The consolidated  financial  statements include the accounts of Citrus Financial
Services,  Inc.,  and  its  wholly  owned  subsidiary,  Citrus  Bank,  N.A.  The
consolidated  financial  statements  for the three and six months ended June 30,
2000 and 1999, have not been audited and do not include information or footnotes
necessary  for a  complete  presentation  of  financial  condition,  results  of
operations  and cash flows in  conformity  with  generally  accepted  accounting
principles. However, in the opinion of management, the accompanying consolidated
financial  statements  contain all adjustments,  which are of a normal recurring
nature,  necessary for a fair  presentation.  The results of operations  for the
interim  periods are not  necessarily  indicative  of the  results  which may be
expected for an entire year. The accounting  policies followed by Citrus are set
forth in Note 1 to Citrus'  consolidated  financial  statements contained in the
1999 Annual Report to Stockholders and are incorporated herein by reference.

Use of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.

Material  estimates that are  particularly  susceptible  to  significant  change
relate to the  determination of the allowance for credit losses on loans and the
valuation  of  real  estate  acquired  in  connection  with  foreclosures  or in
satisfaction  of loans  ("Other  Real Estate  Owned").  In  connection  with the
determination  of the allowances for credit losses on loans and foreclosed  real
estate, management obtains independent appraisals for significant properties.

While  management  uses available  information to recognize  losses on loans and
foreclosed  real estate,  future  additions to the  allowances  may be necessary
based on changes in local economic conditions. In addition, regulatory agencies,
as an integral part of their  examination  process,  periodically  review Citrus
Bank's allowances for losses on loans and foreclosed real estate.  Such agencies
may require Citrus Bank to recognize  additions to the allowances based on their
judgments about information  available to them at the time of their examination.
Management  does not  anticipate  that the allowances for credit losses on loans
and foreclosed real estate will change materially in the near term.

Fair Value of Financial Instruments

Financial  instruments of Citrus consist of cash, due from banks,  federal funds
sold,  investment  securities,  loans receivable,  accrued interest  receivable,
deposits, federal funds purchased,  other borrowings,  accrued interest payable,
and  off-balance  sheet  commitments  such as  commitments  to extend credit and
standby letters of credit. On an interim basis, management considers the cost of
providing estimated fair values by each class of financial  instrument to exceed
the benefits derived. In management's  opinion, the carrying amount of financial
instruments approximates fair value.












                                      - 8 -






<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                  JUNE 30, 2000


NOTE 2 - COMPUTATION OF PER SHARE EARNINGS

Basic  earnings  per share  amounts are computed by dividing net earnings by the
weighted average number of common shares outstanding during the period.  Diluted
earnings per share are computed by dividing net earnings by the weighted average
number of shares  and all  dilutive  potential  shares  outstanding  during  the
period.  The following  information  was used in the computation of earnings per
share on both a basic and diluted  basis for the three and six months ended June
30, 2000 and 1999 (in thousands except per share data):

<TABLE>
<CAPTION>
                                                                    For the Three Months         For the Six Months
                                                                       Ended June 30,               Ended June 30,
                                                                   2000           1999           2000           1999
                                                                  ------         ------         ------         ------
<S>                                                               <C>            <C>            <C>            <C>

Basic EPS computation:
    Numerator - Net income                                        $   59         $  123         $  116         $  245
    Denominator - Weighted average shares outstanding              1,411            952          1,370            952
                                                                  ------         ------         ------         ------

    Basic EPS                                                     $ 0.04         $ 0.13         $ 0.08         $ 0.26
                                                                  ======         ======         ======         ======

Diluted EPS computation:
    Numerator - Net income                                        $   59         $  123         $  116         $  245
                                                                  ------         ------         ------         ------
    Denominator - Weighted average shares outstanding              1,411            952          1,370            952
    Stock options and warrants                                        24            227             24            227
                                                                  ------         ------         ------         ------

                                                                   1,435          1,179          1,394          1,179
                                                                  ------         ------         ------         ------

    Diluted EPS                                                   $ 0.04         $ 0.10         $ 0.08         $ 0.21
                                                                  ======         ======         ======         ======
</TABLE>


NOTE 3 - LOANS HELD FOR INVESTMENT

Loans held for investment consisted of (dollars in thousands):
<TABLE>
<CAPTION>
                                                                       June 30,            December 31,
                                                                         2000                  1999
                                                                       --------              -------
<S>                                                                    <C>                  <C>

Real estate                                                            $ 53,861             $ 49,486
Commercial and agriculture                                               14,797               13,881
Installment and other loans                                               4,289                4,385
                                                                       --------             --------
      Total loans, gross                                                 72,947               67,752
Unearned income and deferred fees                                            (3)                  (2)
Allowance for credit losses                                                (501)                (401)
                                                                       --------             --------
      Net loans                                                        $ 72,443             $ 67,349
                                                                       ========             ========
</TABLE>











                                      - 9 -




<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                  JUNE 30, 2000


NOTE 4 - LOANS HELD FOR SALE

Loans held for sale include  residential real estate loans held for sale to FNMA
and  outstanding  loans  originated by third- party brokers,  assigned to Citrus
Bank,  and held by Citrus Bank  pending  transfer  to  investors  with  take-out
commitments.  At June 30,  2000,  and  December  31,  1999,  such loans  totaled
$599,000 and $1,963,000, respectively. These loans are carried at cost, which is
lower than market.

Citrus Bank does not originate any significant amounts of loans specifically for
resale.  Loans  originated by Citrus Bank and sold principally to FNMA generally
represent  less  than 3% of all  loans  originated.  The only  servicing  income
received by Citrus Bank comes form the  servicing of loans sold  principally  to
FNMA, which is not considered to be material.


NOTE 5 - ALLOWANCE FOR CREDIT LOSSES

Citrus'  Board of Directors  monitors the loan  portfolio  quarterly in order to
enable  it to  evaluate  the  adequacy  of  the  allowance  for  credit  losses.
Management  has  implemented  a risk system that  identifies  potential  problem
credits as early as  possible,  categorizes  the credits as to risk,  and puts a
reporting process in place to monitor the progress of the credits.

Citrus maintains the allowance for credit losses at a level sufficient to absorb
all estimated  losses inherent in the loan portfolio.  Activity in the allowance
for credit losses follows (dollars in thousands):
<TABLE>
<CAPTION>

                                               Six Months       Twelve Months
                                             Ended June 30,   Ended December 31,
                                                 2000               1999
                                               --------            -------
<S>                                              <C>                <C>

Balance, beginning of period                     $401               $461
                                                 ----               ----
Recoveries
         Real estate loans                        --                 --
         Installment loans                          1                --
         Credit card and related plans              1                  1
         Commercial and all other loans           --                  32
                                                 ----               ----
                                                    2                 33
                                                 ----               ----
Charge-offs
         Real estate loans                        --                 --
         Installment loans                          5                153
         Credit card and related plans              7                 28
         Commercial and all other loans            15                587
                                                 ----               ----
                                                   27                768
                                                 ----               ----

Provision charged to operations                   125                675
                                                 ----               ----

Balance, end of period                           $501               $401
                                                 ====               ====

</TABLE>









                                     - 10 -



<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                  JUNE 30, 2000


NOTE 6 - FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

Citrus 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.  Those instruments
involve,  to varying  degrees,  elements of credit,  and  interest  rate risk in
excess of the amounts  recognized in the balance sheet. The contract or notional
amounts of those  instruments  reflect the extent of  involvement  Citrus has in
particular classes of financial instruments.

Financial  instruments  at June 30,  2000,  consisted of  commitments  to extend
credit approximating $8.3 million and letters of credit of $746,000.

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 are expected to expire
without  being  drawn  upon,  the total  commitment  amounts do not  necessarily
represent future cash requirements.


NOTE 7 - STOCKHOLDERS' EQUITY

Authorized Capital Stock:
Citrus has authorized 11,000,000 shares of authorized capital stock,  consisting
of  10,000,000  shares of common  stock,  par value $3.15 (as adjusted for stock
splits) per share,  and 1,000,000  shares of preferred stock, par value of $5.00
per share. As of June 30, 2000, 1,423,392 shares of common stock were issued and
outstanding  and 58,824  shares  were  subject to  issuance  pursuant  to vested
options and warrants. No shares of preferred stock were issued.

Stock Warrants:
In connection with Citrus' 1990 offering,  organizers  were granted  warrants to
purchase  469,772  shares of common  stock at $6.31 per share,  (as adjusted for
stock splits).  The warrants are exercisable  for a ten-year  period  commencing
April 13,  1990.  During the first and second  quarters  of 2000,  warrants  for
36,997 and 60,439 shares, respectively, were exercised. Warrants totaling 17,465
expired  unexercised  during the quarter ended June 30, 2000, which  represented
less than 4% of the original warrants.

Executive Officer Stock Options:
Citrus has also entered into stock option agreements with its executive officers
providing for the granting of 112,613  non-statutory stock options. Such options
are  exercisable  between  $6.31 (as adjusted  for stock  splits) and $10.75 per
share.  In April 2000,  18,789  options were  exercised  leaving  93,824 options
outstanding at June 30, 2000 (of which 58,824 options were vested).


NOTE 8 - SUBSEQUENT EVENT

In July 2000,  the Citrus Board of Directors  voted to close down the Miami loan
production  office as of July 31, 2000.  No costs of closing down the Miami loan
production office have been accrued or estimated at this time.











                                     - 11 -


<PAGE>




                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

                                    Overview

Citrus Financial Services,  Inc., is a registered bank holding company under the
federal  Bank  Holding  Company Act of 1956,  as  amended,  and owns 100% of the
issued and outstanding  common stock of Citrus Bank, N.A., Vero Beach,  Florida.
Citrus was incorporated  under the laws of the State of Florida on May 19, 1989,
to enhance Citrus Bank's ability to serve its future customers' requirements for
financial  services.  The holding company provides  flexibility for expansion of
Citrus' banking business through acquisition of other financial institutions and
provision  of  additional   banking-related   services  which  the   traditional
commercial bank may not provide under present laws.

Citrus Bank  commenced  business  operations  on April 13, 1990,  in a permanent
facility  located at the corner of Indian River Boulevard and 17th Street,  Vero
Beach,  Florida.  The facility is a three-story  office  condominium,  the first
floor of which is owned by Citrus Bank.  Citrus Bank operates a branch office at
1020 U.S. 1, Sebastian, Florida, which commenced operations in February 1993 and
another branch office located at 1020 Buttonwood Street,  Barefoot Bay, Florida,
which commenced  operations in September 1996.  During 1999,  Citrus opened loan
production offices in Miami and Sebring, Florida.

                           Forward-looking Statements

When used in this Form 10-QSB,  the words or phrases "will likely  result," "are
expected  to," "will  continue,"  "is  anticipated,"  "estimate,"  "project," or
similar expressions are intended to identify "forward-looking statements" within
the  meaning of the  Private  Securities  Litigation  Reform  Act of 1995.  Such
statements are subject to certain risks and  uncertainties  including changes in
economic  conditions in Citrus'  market area,  changes in policies by regulatory
agencies,  fluctuations  in interest  rates,  demand for loans in Citrus' market
area and competition,  that could cause actual results to differ materially from
historical earnings and those presently anticipated or projected.  Citrus wishes
to caution  readers  not to place  undue  reliance  on any such  forward-looking
statements,  which  speak  only as to the date  made.  Citrus  wishes  to advise
readers that the factors listed above could affect Citrus' financial performance
and could cause Citrus' actual  results for future periods to differ  materially
from any opinions or statements  expressed with respect to future periods in any
current statements.  Citrus does not undertake,  and specifically  disclaims any
obligation, to publicly release the result of any revisions which may be made to
any forward-looking statements to reflect events or circumstances after the date
of such statements or to reflect the occurrence of anticipated or  unanticipated
events.

         Contingencies and Uncertainties - Year 2000 Compliance Matters

During the periods leading up to January 1, 2000, Citrus addressed the potential
problems  associated  with the  possibility  that the computers  that control or
operate Citrus'  information  technology system and  infrastructure may not have
been  programmed  to read  four-digit  date codes and,  upon arrival of the year
2000,  may have  recognized  the two-digit  code "00" as the year 1900,  causing
systems to fail to function or generate erroneous data.

Citrus  expended  approximately  $55,000  since the  inception  of its Year 2000
compliance  program.  Citrus experienced no significant  problems related to its
information  technology systems upon arrival of the Year 2000, nor was there any
reported  interruption  in service to its customers of any kind. No  significant
Year 2000 expenses have been incurred since December 31, 1999.

Citrus could incur losses if Year 2000 issues adversely affect its depositors or
borrowers.  Such problems  could include  delayed loan payments due to Year 2000
problems affecting any significant borrowers or impairing the payroll systems of
large employers in Citrus' primary market areas.  Because Citrus' loan portfolio
is  highly  diversified  with  regard  to  individual  borrowers  and  types  of
businesses,  Citrus  does  not  expect,  and  to  date  has  not  realized,  any
significant  or  prolonged  difficulties  that will affect net  earnings or cash
flow.







                                     - 12 -


<PAGE>




                         Future Accounting Requirements

In September 1998, the Financial  Accounting Standards Board issued Statement of
Financial Accounting  Standards No. 133, "Accounting for Derivative  Instruments
and Hedging  Activities"  ("SFAS  133"),  which  addresses  the  accounting  for
derivative  instruments  and  provides  for  matching the timing of gain or loss
recognition  on the  hedging  instrument.  Guidance  on  identifying  derivative
instruments  is also  provided as well as additional  disclosures.  SFAS 133 has
been deferred to become  effective  for all fiscal  quarters of all fiscal years
beginning  after June 15, 2000.  Earlier  application  is permitted with certain
exceptions. Management does not anticipate that adoption of SFAS 133 will have a
material impact on the financial condition or results of operations of Citrus.

                               Impact of Inflation

The  consolidated  financial  statements and related data presented  herein have
been  prepared in  accordance  with  generally  accepted  accounting  principles
("GAAP"),  which require the  measurements  of financial  position and operating
results  in terms of  historical  dollars,  without  considering  changes in the
relative  purchasing  power of money  over time due to  inflation.  Unlike  most
industrial companies,  substantially all of the assets and liabilities of Citrus
are  monetary in nature.  As a result,  interest  rates have a more  significant
impact on Citrus'  performance  than the effects of general levels of inflation.
Interest  rates do not  necessarily  move in the same  direction  or in the same
magnitude as the prices of goods and services, since such prices are affected by
inflation  to  a  larger  extent  than  interest  rates.  As  discussed  herein,
management seeks to manage the relationships  between interest  sensitive assets
and  liabilities  in order to protect  against wide interest rate  fluctuations,
including those resulting from inflation.

                              Results of Operations

Net Income

Citrus' net income declined  $64,000 and $129,000,  respectively,  for the three
and six months ended June 30, 2000,  over the comparable  periods in 1999.  This
downward  trend for the three and six months  ended June 30,  2000,  versus 1999
reflects:

-   declining margins as the cost of deposits have risen more sharply than the
    yield on earning assets;

-   increased provision for credit losses of $53,000 and $105,000, respectively;

-   increased operating costs associated with the loan production offices in
    Miami and Sebring, Florida; and

-   declines experienced in the origination of loans under Citrus Bank's funding
    program.

The increase in average earning assets of $8.6 million,  or 11.7%, for the first
six months of 2000  versus the same  period in 1999  along with an  increase  of
approximately  10 basis points in the average yield on earning assets produced a
net increase in total interest  income of $422,000,  or 13.4%,  in the first six
months of 2000 as  compared  to the first six months of 1999.  For the three and
six months ended June 30, 2000, as compared with the comparable  period in 1999,
increases in total interest income of $242,000 and $422,000,  respectively, were
partially  offset by  increases in interest  expense of $220,000  and  $284,000,
respectively. Noninterest expense in the first six months of 2000 as compared to
the  first  six  months  of 1999  rose at a pace of  13.7%  to  $1,816,000  from
$1,597,000.   The  loan  production  offices  started  in  1999  contributed  to
substantially  all of this  increase.  The return on average  assets for the six
months ended June 30, 2000, was 0.26%  annualized as compared with the return of
average assets of 0.61% for the same period in 1999.

Net Interest Income

The largest component of net income for Citrus is net interest income,  which is
the difference between the income earned on assets and interest paid on deposits
and borrowings used to support such assets. Net interest income is determined by
the rates  earned on Citrus'  interest-earning  assets and the rates paid on its
interest-bearing  liabilities,  the relative amounts of interest-earning  assets
and  interest-bearing  liabilities,  and the degree of mismatch and the maturity
and   repricing    characteristics   of   its   interest-earning    assets   and
interest-bearing liabilities.






                                     - 13 -


<PAGE>





Net interest income (before  provision for credit losses) was $1,911,000 for the
six months ended June 30,  2000,  as compared to  $1,773,000  for the six months
ended June 30,  1999.  The  substantial  average  growth of  Citrus'  total loan
portfolio between these periods of almost $9.8 million,  or 15.8%, was more than
offset by an increase in the average cost of interest-bearing  liabilities of 40
basis points,  which  contributed to the decline in the net interest  margin and
interest-rate  spread. Net interest margin (which is net interest income divided
by average  interest-earning assets) declined 4.6% for the six months ended June
30,  2000,  as  compared  to 4.8% for the six months  ended June 30,  1999.  Net
interest-rate spread, the difference between the yield on earning assets and the
rate paid on  interest-bearing  liabilities,  was 3.7% for the six months  ended
June 30, 2000, as compared to 4.0% for the six months ended June 30, 1999.

The decline in the key  measurements  of net  interest  income  results from the
shift in the mix of deposit  liabilities  with higher  costing  certificates  of
deposit  comprising a greater  percentage of total  deposits.  At June 30, 2000,
certificates of deposit totaled $55.4 million,  or 67.8%, of total deposits,  as
compared with $49.0 million,  or 61.9%, at December 31, 1999. For the six months
ended June 30, 2000 and 1999, the ratios were 63.5% and 60.6%, respectively.  In
addition,  rates paid on certificates of deposit have increased by approximately
40 basis points in the six months ended June 30, 2000, as compared with the same
period in 1999.

Average Balances,  Income and Expenses,  and Rates. The following table depicts,
for the  periods  indicated,  certain  information  related to  Citrus'  average
balance sheet and its average yields on assets and average costs of liabilities.
Such yields are derived by dividing  income or expense by the average balance of
the corresponding assets or liabilities. Average balances have been derived from
daily averages.














                        [Page intentionally left blank.]





















                                     - 14 -


<PAGE>




Average Balances, Income and Expenses, and Rates (dollars in thousands)
<TABLE>
<CAPTION>

                                                                            For the Six Months Ended June 30,
                                                                       2000                                   1999
                                                         --------------------------------        -----------------------------
                                                                     Interest       Average                 Interest     Average
                                                        Average         and         Yield/      Average        and        Yield/
                                                        Balance      Dividends       Rate       Balance     Dividends      Rate
                                                        -------      ---------       ----       -------     ---------      ----
<S>                                                     <C>           <C>            <C>        <C>         <C>            <C>

Earning assets:
     Interest-earning deposits                          $    85       $     3        6.3%       $    28      $     1       4.9%
     Taxable securities                                   7,071           210        5.9%         5,987          160       5.3%
     Federal funds sold                                   4,144           121        5.8%         6,390          151       4.7%
     Loans held for sale                                  1,059            44        8.3%         6,515          324       9.9%
     Loans held for investment, net                      70,354         3,198        9.1%        55,143        2,518       9.1%
                                                         ------        ------                    ------        -----

         Total earning assets                            82,713         3,576        8.6%        74,063        3,154       8.5%
                                                                       ------                                  -----

Non-earning assets                                        6,984                                   6,841
                                                         ------                                  ------

         Total assets                                   $89,697                                 $80,904
                                                        =======                                 =======

Interest-bearing liabilities:
     NOW and money market deposits                      $ 8,153            94        2.3%       $ 6,799           62       1.8%
     Savings                                              8,570           138        3.2%         9,580          152       3.2%
     Time deposits                                       51,004         1,428        5.6%        44,158        1,147       5.2%
     Other borrowings                                       168             5        5.8%           944           20       4.2%
                                                         ------         -----                    ------        -----

         Total interest-bearing liabilities              67,895         1,665        4.9%        61,481        1,381       4.5%
                                                                        -----                                  -----

Noninterest-bearing liabilities                          12,989                                  12,856
Stockholders' equity                                      8,813                                   6,567
                                                         ------                                  ------

         Total liabilities and
              stockholders' equity                      $89,697                                 $80,904
                                                        =======                                 =======

Net interest income before provision
  for credit losses                                                   $ 1,911                                $ 1,773
                                                                      =======                                =======

Interest-rate spread                                                                 3.7%                                  4.0%
                                                                                     ====                                  ====

Net interest margin                                                                  4.6%                                  4.8%
                                                                                     ====                                  ====

Ratio of average earning assets to
  average interest-bearing liabilities                   121.8%                                  120.5%
                                                         ======                                  ======


</TABLE>













                                     - 15 -


<PAGE>




Provision and Allowance for Credit Losses

Citrus has developed  policies and procedures for evaluating the overall quality
of its credit  portfolio  and the timely  identification  of  potential  problem
loans. Management's judgment as to the adequacy of the allowance is based upon a
number of  assumptions  about future events which it believes to be  reasonable,
but  which  may or may  not be  valid.  Thus,  there  can be no  assurance  that
charge-offs in future periods will not exceed the allowance for credit losses or
that additional increases in the credit loss allowance will not be required.

Asset  Classification.  Commercial  banks  are  required  to  review  and,  when
appropriate, classify their assets on a regular basis. The OCC has the authority
to identify  problem assets and, if appropriate,  require them to be classified.
There are three  classifications for problem assets:  substandard,  doubtful and
loss.   Substandard   assets  have  one  or  more  defined  weaknesses  and  are
characterized  by the distinct  possibility  that the insured  institution  will
sustain some loss if the  deficiencies  are not corrected.  Doubtful assets have
the weaknesses of substandard assets with the additional characteristic that the
weaknesses  make  collection  or  liquidation  in full on the basis of currently
existing  facts,  condition,  and  values  questionable,  and  there  is a  high
possibility of loss. An asset classified as loss is considered uncollectible and
of such little  value that  continuance  as an asset of the  institution  is not
warranted.  If an asset or portion  thereof is classified  as loss,  the insured
institution establishes a specific reserve for the full amount of the portion of
the asset  classified as loss. All or a portion of general loan loss  allowances
established to cover possible losses related to assets classified as substandard
or doubtful may be included in determining an institution's  regulatory capital,
while specific valuation  allowances for loan losses generally do not qualify as
regulatory   capital.   Assets  that  do  not  warrant   classification  in  the
aforementioned  categories,  but possess  weaknesses,  are classified as special
mention and are monitored by Citrus.

At June 30, 2000,  Citrus had 14 loans classified as substandard,  doubtful,  or
loss  totaling  $2.0 million.  At December 31, 1999,  Citrus had loans  totaling
$656,000  in  the  same  categories.   Substantially  all  of  the  increase  is
attributable  to three  borrowers  and their  affiliated  companies.  Management
believes that two of the underlying loan  relationships  are  well-secured.  The
third  loan  relationship  is  believed  to be  backed  by a  financially  sound
guarantor.  At both June 30, 2000, and December 31, 1999, Citrus had no material
loss  assets to be  charged-off.  Loans  classified  by  management  as impaired
totaled  $562,000  and  $368,000  at June  30,  2000,  and  December  31,  1999,
respectively.

Nonperforming  loans include loans that have been placed on nonaccrual status by
Citrus and loans past due for ninety days or more.  Some of these  nonperforming
loans are well-collateralized,  posing no significant risk of loss, and have not
been classified as substandard,  doubtful,  or loss. A summary of  nonperforming
loans and assets follows:










                        [Page intentionally left blank.]












                                     - 16 -




<PAGE>

<TABLE>
<CAPTION>


                                                                                     June 30,          December 31,
                                                                                       2000               1999
                                                                                     --------           -------
                                                                                        (dollars in thousands)
<S>                                                                                   <C>                <C>

Nonaccrual loans held for investment:
     Real estate loans                                                                $ --               $   88
     Installment loans                                                                   209                201
     Credit cards and related plans                                                     --                 --
     Commercial and all other loan                                                     1,205                167
                                                                                      ------             ------
Total nonaccrual loans held for investment                                             1,414                456
                                                                                      ------             ------

Accruing loans held for investment over 90 days delinquent:
     Real estate loans                                                                  --                 --
     Installment loans                                                                  --                 --
     Credit cards and related plans                                                     --                    2
     Commercial and all other loans                                                     --                 --
                                                                                      ------             ------
Total accrual loans held for investment over 90 days delinquent                         --                    2
                                                                                      ------             ------

Troubled debt restructurings not included above                                         --                 --
                                                                                      ------             ------

Total nonperforming loans held for investment                                          1,414                458
                                                                                      ------             ------

Other real estate owned:
     Real estate acquired by foreclosure or deed in lieu
         of foreclosure                                                                   88               --
                                                                                      ------             ------
     Total nonperforming loans held for investment and
          other real estate owned                                                     $1,502             $  458
                                                                                      ======             ======

     Total nonperforming loans held for investment
         as a percentage of total loans held for investment                             1.94%              0.68%
                                                                                      ======             ======
     Total nonperforming loans held for investment
         as a percentage of total assets                                                1.54%              0.52%
                                                                                      ======             ======
     Total nonperforming loans held for investment
         and other real estate owned as a percentage of total assets                    1.64%              0.52%
                                                                                      ======             ======

Troubled debt restructurings and modified loans held for investment:
     Current                                                                          $1,678             $1,585
     Past due over 30 days and less than 90 days                                        --                   60
     Past due over 90 days and included above                                           --                   88
                                                                                      ------             ------

                                                                                      $1,678             $1,733
                                                                                      ======             ======
</TABLE>


Nonperforming loans at June 30, 2000, increased from the quarter ended March 31,
2000,  total of $362,000,  and the December 31, 1999,  total of $458,000.  Other
real estate owned at June 30, 2000,  totaled $88,000,  as compared with no other
real estate owned at December 31, 1999.  Troubled debt restructuring at June 30,
2000, declined $55,000 from the level at December 31, 1999.

Allowance for Credit  Losses.  The  allowance  for credit losses is  established
through a provision for loan losses charged  against  income.  Loans are charged
against the provision when management  believes that the  collectibility  of the
principal is unlikely.  The  provision  is an estimated  amount that  management
believes will be adequate to absorb losses  inherent in the loan portfolio based
on evaluations of its  collectibility.  The evaluations take into  consideration
such  factors as changes  in the  nature  and volume of the  portfolio,  overall
portfolio  quality,   specific  problem  loans  and  commitments,   and  current
anticipated  economic  conditions that may affect the borrower's ability to pay.
While  management  uses the best  information  available to recognize  losses on
loans,  future  additions to the provision may be necessary  based on changes in
economic conditions.



                                     - 17 -


<PAGE>

<TABLE>
<CAPTION>


Activity in the allowance for credit losses follows (dollars in thousands):
                                                                      Six Months          Twelve Months
                                                                         Ended                Ended
                                                                        June 30,           December 31,
                                                                          2000                1999
                                                                        --------            --------
<S>                                                                       <C>                  <C>

Allowance at beginning of period                                          $401                 $461
                                                                          ----                 ----

Recoveries:
    Real estate loans                                                      --                   --
    Installment loans                                                        1                  --
    Credit cards and related plans                                           1                    1
    Commercial and all other loans                                         --                    32
                                                                          ----                 ----
Total recoveries                                                             2                   33
                                                                          ----                 ----

Charge-offs:
    Real estate loans                                                      --                   --
    Installment loans                                                        5                  153
    Credit cards and related plans                                           7                   28
    Commercial and all other loans                                          15                  587
                                                                          ----                 ----
Total charge-offs                                                           27                  768
                                                                          ----                 ----

Provision for credit losses charged to operations                          125                  675
                                                                          ----                 ----

Allowance at end of period                                                $501                 $401
                                                                          ====                 ====

Ratio of net charge-offs during the period to average
   loans outstanding during the period (including loans
   held for sale)                                                         0.07%                1.15%
                                                                          ====                 ====

</TABLE>

At June 30, 2000, the allowance for credit losses amounted to $501,000, or 0.69%
of outstanding  loans held for  investment.  At December 31, 1999, the allowance
for credit losses amounted to $401,000,  or 0.59% of outstanding  loans held for
investment.  Citrus' provision for credit losses was $125,000 for the six months
ended June 30, 2000.  For the same six months period in 1999,  the provision for
credit  losses  was  $20,000.  The  provision  was made  based  on  management's
assessment of general  credit loss risk and asset  quality.  The increase in the
allowance for credit losses as a percentage of outstanding loans reflects recent
increases in the level of net charge-offs experienced in late-1999 and increases
in classified and nonperforming loans during the first six months of 2000.

Noninterest Income and Expense

Noninterest  Income.  Citrus'  primary source of  noninterest  income is service
charges on deposit  accounts.  In addition,  Citrus  originates  mortgage loans,
which are closed in the name of a third party,  for which Citrus receives a fee.
Other sources of noninterest income include bankcard fees,  commissions on check
sales, safe deposit box rent, wire transfer, and official check fees.

Total  noninterest  income decreased by $23,000,  or 9.7%, during the six months
ended June 30,  2000,  as compared to the same period in 1999.  Fees and service
charges were  $201,000  for the six months  ended June 30, 2000,  as compared to
$220,000  for the  comparable  periods in 1999, a decrease of 8.6%. A decline in
NSF and overdraft fees of approximately $30,000 contributed to this decline.










                                     - 18 -




<PAGE>



Noninterest Expense.  Total noninterest expense increased by $219,000, or 13.7%,
during the six months  ended June 30,  2000,  as  compared to the same period in
1999. This increase was consistent with Citrus' loan growth and reflected normal
salary and benefit increases, including the new loan production offices in Miami
and Sebring,  Florida.  As a result of these factors,  Citrus experienced higher
operating costs as follows:

  - salary and benefit expenses increased $97,000, or 11.6%;
  - occupancy-related expenses increased $59,000, or 19.5%; and,
  - other operating expenses increased $63,000, or 13.7%.

Income Tax Expense

The income tax  provision was $68,000 for the six months ended June 30, 2000, or
an effective  rate of 37.0%.  This compares with an effective  rate of 37.6% for
the same period in 1999.


                   Comparison of Results of Operations for the
                    Three Months Ended June 30, 2000 and 1999

Net Interest Income

Net interest  income  (before  provision for credit losses) was $946,000 for the
three months  ended June 30, 2000,  as compared to $924,000 for the three months
ended June 30, 1999. The increases in earning assets of $11.8 million, or 16.2%,
were  attributable to the growth of Citrus' loan portfolio of $15.4 million,  or
27.3%, between these periods; however the declining net interest-rate spread and
net  interest  margin  contributed  to only  moderate  increases in net interest
income in 2000 versus 1999.  Net interest  spread,  the  difference  between the
yield on earning assets and the rate paid on interest-bearing  liabilities,  was
3.6% for the three months ended June 30, 2000, as compared to 4.4% for the three
months ended June 30, 1999. Net interest margin,  net interest income divided by
average  interest-earning assets, declined to 4.5% in the second quarter of 2000
from  the  5.1%  reported  for  the  three  months  ended  June  30,  1999.  Net
interest-rate  spread and net interest  margins were impacted by higher costs of
deposits  and  the  reversal  of  interest   income  on   nonaccrual   loans  of
approximately $33,000.

Noninterest Income and Expense

Noninterest  Income.  Total  noninterest  income  declined by $19,000 during the
three  months  ended June 30,  2000,  as  compared  to the same  period in 1999,
reflecting  decreased  NSF and  overdraft  fees.  Fees and service  charges were
$98,000 for the three months  ended June 30,  2000,  as compared to $113,000 for
the comparable period in 1999, a decrease of 13.3%.

Noninterest  Expense.  Total noninterest expense increased by $53,000 during the
three months ended June 30, 2000,  as compared to the same period in 1999,  as a
result of  Citrus'  continued  growth.  For the  second  quarter  of 2000,  this
increase  includes  an increase in salary and  benefits  expense of $13,000,  or
2.9%.  Occupancy-related  expenses  increased  $24,000,  or 14.8%, in the second
quarter of 2000 as compared with the same period in 1999, principally due to the
start- up of Citrus'  in-house data  processing  center and the loan  production
offices.  Other  operating  expenses  for the second  quarter of 2000  increased
$16,000, or 6.5%, as compared with the same period in 1999.

Income Tax Expense

The income tax  provision  was $35,000 for the three months ended June 30, 2000,
or an effective rate of 37.2%. This compares with an effective rate of 37.6% for
the same period in 1999.










                                     - 19 -



<PAGE>



                               Financial Condition

Citrus' total assets at June 30, 2000,  were $91.5 million,  an increase of $3.4
million,  or 3.9%,  from $88.1 million at December 31, 1999.  Increases in total
loans of $3.7  million were offset by declines in cash and cash  equivalents  of
$3.2 million since  December 31, 1999.  Deposits  increased  approximately  $2.7
million,  with higher costing  certificates of deposit contributing $6.4 million
in total increases and offsets in other deposits of $3.7 million.

Total stockholders' equity as of June 30, 2000, was $9.2 million, an increase of
$839,000,  or approximately  10.0%,  compared with stockholders'  equity of $8.4
million as of December 31, 1999.  This increase was  attributable  to net income
for the six months of 2000 of $116,000 and $733,000 in  additional  capital from
the  exercise  of the options and  warrants,  partially  offset by a decrease of
$10,000  in the  market  value  (net of  deferred  income  taxes) of  investment
securities available-for-sale.

The following  table shows selected ratios for the periods ended or at the dates
indicated (annualized for the six months ended June 30, 2000):
<TABLE>
<CAPTION>
                                                                               Six Months Ended    Year Ended
                                                                                    June 30,       December 31,
                                                                                      2000            1999
                                                                                    --------        ---------
<S>                                                                                   <C>            <C>

Return on average assets                                                              0.26%          -0.33%
Return on average equity                                                              2.63%          -4.09%
Interest-rate spread during the period                                                3.70%           4.10%
Net interest margin                                                                   4.60%           4.70%
Allowance for credit losses to period end loans held for investment                   0.69%           0.59%
Net charge-offs to average loans held for investment                                  0.07%           1.26%
Nonperforming assets to period end loans held for investment
    and foreclosed property                                                           2.06%           0.68%
Nonperforming assets to period end total assets                                       1.64%           0.52%
</TABLE>


Liquidity and Capital Resources

Liquidity  Management.  Liquidity management involves monitoring Citrus' sources
and uses of funds in order to meet its day-to-day cash flow  requirements  while
maximizing  profits.  Liquidity  represents  the ability of a company to convert
assets  into  cash or cash  equivalents  without  significant  loss and to raise
additional funds by increasing  liabilities.  Liquidity  management is made more
complicated  because  different  balance sheet components are subject to varying
degrees of  management  control.  For example,  the timing of  maturities of the
investment portfolio is very predictable and subject to a high degree of control
at the time  investment  decisions are made.  However,  net deposit  inflows and
outflows  are far less  predictable  and are not  subject to the same  degree of
control.  Asset  liquidity  is  provided  by cash and assets  which are  readily
marketable,  which can be  pledged,  or which  will  mature in the near  future.
Liability  liquidity is provided by access to core funding sources,  principally
the ability to generate customer deposits in Citrus' market area.

In  addition,  liability  liquidity  is  provided  through the ability to borrow
against  approved lines of credit (federal funds  purchased) from  correspondent
banks and to borrow on a secured basis through  securities sold under agreements
to repurchase.

Short-Term Investments.  Short-term investments,  which consist of federal funds
sold and securities  purchased under  agreements to resell and  interest-bearing
deposits,  averaged  $4.2 million in the first six months of 2000 as compared to
$6.4  million in the same period of 1999.  At June 30,  2000,  and  December 31,
1999,   short-term   investments   totaled  $2.4   million  and  $3.6   million,
respectively.  These  funds are a primary  source of Citrus'  liquidity  and are
generally invested in an earning capacity on an overnight basis.

Management   regularly  reviews  the  liquidity   position  of  Citrus  and  has
implemented   internal  policies  which  establish  guidelines  for  sources  of
asset-based  liquidity  and limit the total  amount of  purchased  funds used to
support the balance sheet and funding from non-core sources.





                                     - 20 -


<PAGE>



Deposits and Other  Sources of Funds.  In addition to  deposits,  the sources of
funds available for lending and other business purposes include loan repayments,
loan sales, and securities sold under agreements to repurchase.  Loan repayments
are a relatively stable source of funds,  while deposit inflows and outflows are
influenced  significantly by general interest rates and money market conditions.
Borrowings  may be used on a short-term  basis to compensate  for  reductions in
other sources,  such as deposits at less than projected levels and are also used
to fund the origination of mortgage loans designated to be sold in the secondary
markets.

Core Deposits. Core deposits,  which exclude certificates of deposit of $100,000
or more,  provide a relatively  stable funding source for Citrus' loan portfolio
and other earning  assets.  Citrus' core deposits were $70.7 million at June 30,
2000,  and $69.3  million at December 31, 1999.  Management  anticipates  that a
stable base of deposits will be Citrus'  primary  source of funding to meet both
its short-term and long-term liquidity needs in the future.

Customers with large  certificates of deposit tend to be extremely  sensitive to
interest rate levels, making these deposits less reliable sources of funding for
liquidity planning purposes than core deposits. Some financial institutions fund
their balance  sheets in part through  large  certificates  of deposit  obtained
through  brokers.  These  brokered  deposits  are  generally  expensive  and are
unreliable as long-term  funding  sources.  Accordingly,  Citrus does not accept
brokered deposits.

Borrowings.  Citrus Bank has a line of credit master  agreement with the FHLB of
Atlanta that enables Citrus Bank to borrow up to $10,000,000. These advances are
collateralized  by  Citrus  Bank's  FHLB  stock  and  a  blanket  floating  lien
consisting of wholly-owned residential (1-4 units) first mortgage loans. At June
30, 2000, there were no advances outstanding under this line. In addition to the
line of credit arrangement,  Citrus Bank had fixed FHLB advances  outstanding as
follows (dollars in thousands):
<TABLE>
<CAPTION>

                                            At June 30,       At December 31,
   Maturity Date       Interest Rate           2000               1999
   -------------       -------------           ----               ----
     <S>                   <C>                <C>                 <C>

     2003                  5.76%              $ 142               $ 167
                                              =====               =====
</TABLE>

During the first six months of 2000,  Citrus repaid other  borrowings of $70,000
from Central  Illinois Bank under its revolving line of credit  agreement in the
amount of $500,000.

Capital.  The Federal  Reserve Board and bank regulatory  agencies  require bank
holding  companies and financial  institutions  to maintain  capital at adequate
levels based on a percentage of assets and off-balance sheet exposures, adjusted
for  risk  weights  ranging  from 0% to 100%  (the  Federal  Reserve  grants  an
exemption from these requirements for bank holding companies with less than $150
million in  consolidated  assets,  and  therefore  Citrus'  capital is currently
measured only at Citrus Bank level). Under the risk-based  standard,  capital is
classified  into two  tiers.  Tier 1 capital  consists  of common  stockholders'
equity,  excluding the unrealized gain (loss) on available-for-sale  securities,
minus  certain  intangible  assets.  Tier 2  capital  consists  of  the  general
allowance for credit losses  subject to certain  limitations.  An  institution's
qualifying capital base for purposes of its risk-based capital ratio consists of
the sum of its Tier 1 and Tier 2 capital.  The regulatory  minimum  requirements
are 4% for Tier 1 and 8% for total risk-based capital.

Bank  holding  companies  and banks are also  required to maintain  capital at a
minimum level based on total assets,  which is known as the leverage ratio.  The
minimum  requirement for the leverage ratio is 3%, but all but the highest rated
institutions  are required to maintain  ratios 100 to 200 basis points above the
minimum. Citrus and Citrus Bank exceeded their minimum regulatory capital ratios
as of June 30, 2000, as reflected in the following table.

The  following  table sets  forth  Citrus  Bank's  regulatory  capital  position
(dollars in thousands):
<TABLE>
<CAPTION>

                                                        Actual           Minimum(1)      Well-Capitalized(2)
                                                  Amount       %       Amount      %       Amount     %
                                                  ------     -----     ------   -----      ------   -----
<S>                                               <C>        <C>       <C>      <C>        <C>      <C>

Total Capital (to Risk-Weighted Assets)           $8,667     11.48%    $6,041   8.00%      $7,551   10.00%
Tier I Capital (to Risk-Weighted Assets)          $8,166     10.81%    $3,020   4.00%      $4,530    6.00%
Tier I Capital (to Average Assets)                $8,166      9.00%    $3,631   4.00%      $4,539    5.00%

(1) The minimum required for adequately capitalized purposes.
(2) To be "well-capitalized" under the FDIC's Prompt Corrective Action
    regulations.
</TABLE>

                                     - 21 -




<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY



PART II:   OTHER INFORMATION

           Item 1.   Legal Proceedings.
                     None.

           Item 2.   Changes In Securities.
                     None.

           Item 3.   Defaults upon Senior Securities.
                     None.

           Item 4.   Submission of Matters to a Vote of Security Holders.
                     An Annual  Meeting  of  Shareholders  was held on
                     April 24, 2000.  At that  meeting,  a majority of
                     the shareholders of record voted to elect a total
                     of four  Class I  directors,  each to serve for a
                     term of  three  years;  to  ratify  the  Board of
                     Directors'    appointment    of   the   Company's
                     independent  auditors  for the fiscal year ending
                     December 31, 2000; to approve the  adjournment of
                     the Annual Meeting to solicit  additional proxies
                     in the event that there were not sufficient votes
                     to approve any one or more or the proposals; and,
                     to transact  such other  business as may properly
                     come  before  the  2000  Annual  Meeting  and any
                     adjournments thereof.

           Item 5.   Other Information.

           Item 6.   Exhibits and Reports on Form 8-K.
                     a) Exhibits.
                         --------
                        Exhibit 27 - Financial Data Schedule.

                     b) Reports on Form 8-K.
                         -------------------
                        A  Form 8-K was filed by Citrus on June 16, 2000, which
                        reported that Mr. Josh C. Cox, Jr., had resigned his
                        executive officer and director positions in Citrus and
                        Citrus Bank, N.A., effective June 14, 2000.  Mr. Randy
                        J. Riley was named interim President and Chief Executive
                        Officer of Citrus and interim Chief Executive Officer of
                        Citrus Bank, N.A.





















                                     - 22 -



<PAGE>



                 CITRUS FINANCIAL SERVICES, INC. AND SUBSIDIARY
                                   SIGNATURES



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



                                      Citrus Financial Services, Inc.




Date:          August 3, 2000         /s/ Randy J. Riley
               --------------         ------------------
                                      Randy J. Riley
                                      Interim President/ Chief Executive Officer



Date:          August 3, 2000         /s/ Marion H. Tupek
               --------------         -------------------
                                      Marion H. Tupek
                                      Vice President


































                                     - 23 -



<PAGE>