U.S. SECURITIES AND EXCHANGECOMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

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

                  For the Quarterly Period Ended June 30, 2005

                                       OR

              TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

               For the Transition Period from _________to_________

                          Commission File no. 000-50466

                             DEKALB BANKSHARES, INC.
        (Exact name of small business issuer as specified in its charter)

                   South Carolina                          61-1444253
            (State or other jurisdiction                (I.R.S. Employer
         of incorporation or organization)            Identification No.)

                             631 West DeKalb Street
                          Camden, South Carolina 29020
                    (Address of principal executive offices)

                                  803.432.7575
                (Issuer's telephone number, including area code)
                ------------------------------------------------

Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during the past 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 [ ]

State the number of shares outstanding of each of the issuer's classes of common
stock as of the latest practicable date.

        610,139 shares of common stock, no par value, as of July 31, 2005


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




<PAGE>




                             DEKALB BANKSHARES, INC.

                                      INDEX


<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION                                                                                      Page No.

Item 1.  Financial Statements (Unaudited)

<S>                                                                                                                   <C>
         Condensed Consolidated Balance Sheets - June 30, 2005 and December 31, 2004......................................3

         Condensed Consolidated Statements of Income - Six months ended June 30, 2005 and June 30, 2004
           and Three months ended June 30, 2005 and 2004..................................................................4

         Condensed Consolidated Statements of Shareholders' Equity and Comprehensive Income -
           Six months ended June 30, 2005 and June 30, 2004...............................................................5

         Condensed Consolidated Statements of Cash Flows - Six months ended June 30, 2005 and June 30, 2004...............6

Notes to Condensed Consolidated Financial Statements...................................................................7-10

Item 2.  Management's Discussion and Analysis or Plan of Operation....................................................11-16

Item 3.  Controls and Procedures.........................................................................................16

PART II. OTHER INFORMATION

Item 4.  Submission of Matters to a Vote of Security Holders.............................................................17
Item 6.  Exhibits .......................................................................................................17
</TABLE>





<PAGE>



                             DEKALB BANKSHARES, INC.
                      Condensed Consolidated Balance Sheets

PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements
<TABLE>
<CAPTION>
                                                                                               June 30,              December 31,
                                                                                                 2005                    2004
                                                                                                 ----                    ----
                                                                                              (Unaudited)
Assets:
   Cash and cash equivalents:
<S>                                                                                          <C>                       <C>
     Cash and due from banks ...................................................             $    644,664              $    567,773
     Federal funds sold ........................................................                1,795,000                 3,175,000
     Other interest bearing deposits ...........................................                  987,986                    61,793
                                                                                             ------------              ------------
       Total cash and cash equivalents .........................................                3,427,650                 3,804,566
                                                                                             ------------              ------------
Time deposits with other banks .................................................                  113,494                   313,494
Investment securities:
   Securities available-for-sale ...............................................               10,131,497                 9,594,385
   Nonmarketable equity securities .............................................                  572,194                   474,813
                                                                                             ------------              ------------
       Total investment securities .............................................               10,703,691                10,069,198
Loans receivable ...............................................................               27,922,930                26,643,037
   Less allowance for loan losses ..............................................                 (291,790)                 (266,478)
                                                                                             ------------              ------------
       Loans, net ..............................................................               27,631,140                26,376,559
Premises and equipment, net ....................................................                1,409,771                 1,411,412
Accrued interest receivable ....................................................                  166,999                   150,875
Other assets ...................................................................                  484,589                   433,673
                                                                                             ------------              ------------
       Total assets ............................................................             $ 43,937,334              $ 42,559,777
                                                                                             ============              ============
Liabilities:
   Deposits:
     Noninterest-bearing transaction accounts ..................................             $  2,942,886              $  2,788,768
     Interest-bearing transaction accounts .....................................                4,387,129                 3,449,845
     Savings ...................................................................                3,211,480                 3,812,952
     Time deposits $100,000 and over ...........................................               11,855,433                12,771,447
     Other time deposits .......................................................                5,657,078                 5,487,366
                                                                                             ------------              ------------
       Total deposits ..........................................................               28,054,006                28,310,378
Advances from Federal Home Loan Bank ...........................................                7,500,000                 5,900,000
Securities sold under agreements to repurchase .................................                3,000,000                 3,000,000
Accrued interest payable .......................................................                   81,953                   120,117
Other liabilities ..............................................................                   92,588                    36,887
                                                                                             ------------              ------------
       Total liabilities .......................................................               38,728,547                37,367,382
                                                                                             ------------              ------------
Shareholders' equity
Common stock, no par value; 20,000,000 shares
   authorized, 610,139 shares issued and outstanding ...........................                5,877,597                 5,877,597
Retained earnings (deficit) ....................................................                 (585,946)                 (644,608)
Accumulated other comprehensive income (loss) ..................................                  (82,864)                  (40,594)
                                                                                             ------------              ------------
       Total shareholders' equity ..............................................                5,208,787                 5,192,395
                                                                                             ------------              ------------
       Total liabilities and shareholders' equity ..............................             $ 43,937,334              $ 42,559,777
                                                                                             ============              ============
</TABLE>

                  See notes to condensed financial statements.



                                       3
<PAGE>

                             DEKALB BANKSHARES, INC.
                   Condensed Consolidated Statements of Income
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                         Six Months Ended                    Three Months Ended
                                                                              June 30,                           June 30,
                                                                              --------                           --------
                                                                        2005              2004              2005             2004
                                                                        ----              ----              ----             ----
Interest income:
<S>                                                                 <C>               <C>               <C>               <C>
   Loans, including fees ...................................        $  900,582        $  711,171        $  454,638        $  368,367
   Investment securities, taxable ..........................           181,885           167,064            89,808            82,153
   FHLB and CFS interest and dividends .....................             9,181             4,440             5,116             2,286
   Federal funds sold ......................................            25,167             9,140            14,045             4,836
   Time deposits with other banks ..........................             2,496             3,615               869             1,616
                                                                    ----------        ----------        ----------        ----------
       Total ...............................................         1,119,311           895,430           564,476           459,258
                                                                    ----------        ----------        ----------        ----------

Interest expense:
   Time deposits $100,000 and over .........................           157,463            89,958            81,282            45,815
   Other deposits ..........................................           101,140            82,147            51,608            41,136
   Other interest expense ..................................           136,576            82,585            71,491            43,560
                                                                    ----------        ----------        ----------        ----------
       Total ...............................................           395,179           254,690           204,381           130,511
                                                                    ----------        ----------        ----------        ----------

Net interest income ........................................           724,132           640,740           360,095           328,747
Provision for loan losses ..................................            37,502            39,000            15,002            21,500
                                                                    ----------        ----------        ----------        ----------
Net interest income after provision for
   loan losses .............................................           686,630           601,740           345,093           307,247
                                                                    ----------        ----------        ----------        ----------

Other operating income:
   Service charges on deposit accounts .....................            70,550            73,834            39,445            41,919
   Residential mortgage loan origination fees ..............           123,624            42,649            67,465            24,317
   Other service charges, commissions
     and fees ..............................................            19,845            14,364             9,149             7,304
                                                                    ----------        ----------        ----------        ----------
       Total ...............................................           214,019           130,847           116,059            73,540
                                                                    ----------        ----------        ----------        ----------

Other operating expenses:
   Salaries and employee benefits ..........................           440,729           343,901           225,071           182,072
   Occupancy expense .......................................            41,128            40,789            19,895            20,030
   Furniture and equipment expense .........................            25,062            23,028            12,633            11,547
   Other operating expenses ................................           299,708           253,607           149,102           125,645
                                                                    ----------        ----------        ----------        ----------
       Total ...............................................           806,627           661,325           406,701           339,294
                                                                    ----------        ----------        ----------        ----------

Income before income taxes .................................            94,022            71,262            54,451            41,493
Income tax expense .........................................            35,360            26,420            20,458            15,158
                                                                    ----------        ----------        ----------        ----------

Net income .................................................        $   58,662        $   44,842        $   33,993        $   26,335
                                                                    ==========        ==========        ==========        ==========

Earnings per share
Basic earnings per share ...................................        $      .10        $      .07        $      .06        $      .04
Diluted earnings per share .................................        $      .10        $      .07        $      .06        $      .04
</TABLE>

                  See notes to condensed financial statements.



                                       4
<PAGE>

                             DEKALB BANKSHARES, INC.
               Condensed Consolidated Statements of Shareholders'
                         Equity and Comprehensive Income
                 For the Six months ended June 30, 2005 and 2004
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                                       Accumulated
                                                                                      Retained            Other
                                                            Common Stock              Earnings        Comprehensive
                                                      Shares            Amount        (Deficit)           Income            Total
                                                      ------            ------        ---------           ------            -----
<S>                                                  <C>           <C>               <C>               <C>              <C>
Balance,
   December 31, 2003 ......................          609,060       $ 5,866,807       $  (732,329)      $   (22,632)     $ 5,111,846

Net income
   for the period .........................                                               44,842                             44,842

Other comprehensive loss,
 net of tax benefit of $74,498 ............                                                               (126,848)        (126,848)
                                                                                                                        -----------

Comprehensive
   income .................................                                                                                 (82,006)
                                                     -------       -----------       -----------       -----------      -----------

Balance,
   June 30, 2004 ..........................          609,060       $ 5,866,807       $  (687,487)      $  (149,480)     $ 5,029,840
                                                     =======       ===========       ===========       ===========      ===========

Balance,
   December 31, 2004 ......................          610,139       $ 5,877,597       $  (644,608)      $   (40,594)     $ 5,192,395

Net income
   for the period .........................                                               58,662                             58,662

Other comprehensive loss,
 net of tax benefit of $24,825 ............                                                               (42,270)          (42,270)
                                                                                                                        -----------

Comprehensive
   income .................................                                                                                  16,392
                                                     -------       -----------       -----------       -----------      -----------

Balance,
   June 30, 2005 ..........................          610,139       $ 5,877,597       $  (585,946)      $   (82,864)     $ 5,208,787
                                                     =======       ===========       ===========       ===========      ===========
</TABLE>






                  See notes to condensed financial statements.



                                       5
<PAGE>


                             DEKALB BANKSHARES, INC.
                 Condensed Consolidated Statements of Cash Flows
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                                             Six Months Ended
                                                                                                                  June 30,
                                                                                                                  --------
                                                                                                          2005                2004
                                                                                                          ----                ----
Cash flows from operating activities:
<S>                                                                                                 <C>                 <C>
   Net income ..............................................................................        $    58,662         $    44,842
   Adjustments to reconcile net income to net cash provided
     by operating activities:
       Provision for loan losses ...........................................................             37,502              39,000
       Depreciation and amortization expense ...............................................             59,333              55,340
       Accretion and premium amortization ..................................................              8,881               8,230
       Deferred income tax provision (benefit) .............................................             31,821             (50,410)
       (Increase) decrease in interest receivable ..........................................            (16,124)             (8,608)
       Decrease in interest payable ........................................................            (38,164)             (2,570)
       Increase in other assets ............................................................            (82,737)            (33,191)
       Increase (decrease) in other liabilities ............................................             55,701              41,471
                                                                                                    -----------         -----------
         Net cash provided by operating activities .........................................            114,875              94,104
                                                                                                    -----------         -----------

Cash flows from investing activities:
   Net increase in loans made to customers .................................................         (1,292,083)         (2,340,381)
   Purchases of securities available-for-sale ..............................................         (1,490,141)         (4,814,984)
   Sale, calls or maturities of securities available-for-sale ..............................                  -           1,074,498
   Payments received on mortgage backed securities .........................................            901,878           1,097,485
   Sale (Purchase) of Federal Home Loan Bank stock .........................................            (91,100)             20,000
   Purchase of Community Financial Services, Inc. stock ....................................             (6,281)           (143,212)
   Purchases of premises and equipment .....................................................            (57,692)            (22,624)
   Maturities (purchases) of time deposits with other banks ................................            200,000              (3,416)
                                                                                                    -----------         -----------
       Net cash used by investing activities ...............................................         (1,835,419)         (5,132,634)
                                                                                                    -----------         -----------

Cash flows from financing activities:
   Net increase in demand deposits, interest-bearing
     transaction accounts and savings accounts .............................................            489,930             957,189
   Net increase (decrease) in certificates of deposit and other time deposits ..............           (746,302)            530,862
   Increase in securities sold under agreements to repurchase ..............................                  -           3,000,000
   Increase in advances from the Federal Home Loan Bank ....................................          1,600,000                   -
                                                                                                    -----------         -----------
         Net cash provided by financing activities .........................................          1,343,628           4,488,051
                                                                                                    -----------         -----------

Net increase (decrease) in cash and cash equivalents .......................................           (376,916)           (550,479)
                                                                                                    -----------         -----------

Cash and cash equivalents, beginning .......................................................          3,804,566           2,269,695
                                                                                                    -----------         -----------

Cash and cash equivalents, end .............................................................        $ 3,427,650         $ 1,719,216
                                                                                                    ===========         ===========

Cash paid during the period for:
   Interest ................................................................................        $   433,343         $   257,260
                                                                                                    ===========         ===========
   Taxes ...................................................................................        $     3,518         $     1,897
                                                                                                    ===========         ===========
</TABLE>



                  See notes to condensed financial statements.



                                       6
<PAGE>

                             DEKALB BANKSHARES, INC.
                     Notes to Condensed Financial Statements
                                   (Unaudited)

Note 1 - Basis of Presentation

The accompanying  financial statements have been prepared in accordance with the
requirements  for  interim  financial  statements  and,  accordingly,  they  are
consolidated and omit  disclosures,  which would  substantially  duplicate those
contained in our 2004 Annual Report on Form 10-KSB. The financial  statements as
of June 30, 2005 are  unaudited  and, in our  opinion,  include all  adjustments
(consisting of normal  recurring  adjustments)  considered  necessary for a fair
presentation. The financial information as of December 31, 2004 has been derived
from the audited financial  statements as of that date. For further information,
refer  to the  financial  statements  and  the  notes  included  in  the  DeKalb
Bankshares,  Inc.  Annual Report on Form 10-KSB for the year ended  December 31,
2004 filed with the Securities and Exchange Commission.

Note 2 - Recently Issued Accounting Pronouncements

The following is a summary of recent  authoritative  pronouncements  that affect
accounting, reporting, and disclosure of financial information by the Company:

In December  2004,  the  Financial  Accounting  Standards  Board  (FASB)  issued
Statement  of Financial  Accounting  Standards  (SFAS) No. 123  (revised  2004),
"Share-Based  Payment" ("SFAS No.  123(R)").  Statement  No.123(R) covers a wide
range  of  share-based   compensation   arrangements  including  share  options,
restricted share plans, performance-based awards, share appreciation rights, and
employee share purchase plans. SFAS No. 123(R) will require companies to measure
all  employee  stock-based  compensation  awards  using a fair value  method and
record such expense in its financial  statements.  In addition,  the adoption of
SFAS No. 123(R)  requires  additional  accounting and disclosure  related to the
income  tax  and  cash  flow  effects   resulting   from   share-based   payment
arrangements.  SFAS No. 123(R) is effective for small business issuers beginning
with the first interim or annual  reporting  period of a company's  first fiscal
year beginning on or after December 15, 2005.

In April 2005,  the  Securities  and Exchange  Commission's  Office of the Chief
Accountant and its Division of  Corporation  Finance  released Staff  Accounting
Bulletin  (SAB) No.107 to provide  guidance  regarding the  application  of FASB
Statement  No.123  (revised  2004),   Share-Based   Payment.  SAB  107  provides
interpretive guidance related to the interaction between Statement No.123(R) and
certain SEC rules and  regulations,  as well as the staff's views  regarding the
valuation of share-based payment arrangements for public companies. SAB 107 also
reminds  public  companies of the  importance  of including  disclosures  within
filings made with the SEC relating to the  accounting  for  share-based  payment
transactions,  particularly  during the transition to Statement  No.123(R).  The
Company is currently  evaluating the impact that the adoption of SFAS No. 123(R)
will have on its financial  position,  results of operations and cash flows. The
cumulative  effect of adoption,  if any, will be measured and  recognized in the
statement of income on the date of adoption.

In November  2003, the Emerging  Issues Task Force ("EITF")  reached a consensus
that certain  quantitative  and qualitative  disclosures  should be required for
debt and marketable equity  securities  classified as available for sale or held
to maturity under SFAS No. 115 and SFAS No. 124 that are impaired at the balance
sheet  date  but  for  which   other-than-temporary   impairment  has  not  been
recognized.  Accordingly  the  EITF  issued  EITF  No.  03-1,  "The  Meaning  of
Other-Than-Temporary  Impairment and Its  Application  to Certain  Investments."
This issue  addresses  the meaning of  other-than-temporary  impairment  and its
application  to investments  classified as either  available for sale or held to
maturity  under  SFAS  No.  115  and  provides   guidance  on  quantitative  and
qualitative  disclosures.  The  disclosure  requirements  of EITF  No.  03-1 are
effective for annual financial statements for fiscal years ending after June 15,
2004. The effective date for the measurement  and  recognition  guidance of EITF
No. 03-1 has been delayed.  The FASB staff has issued a proposed  Board-directed
FASB Staff Position ("FSP"), FSP EITF 03-1-a,  "Implementation  Guidance for the
Application  of Paragraph 16 of Issue No.  03-1." The proposed FSP would provide
implementation guidance with respect to debt securities that are impaired solely
due   to   interest    rates   and/or   sector    spreads   and   analyzed   for
other-than-temporary   impairment   under  the   measurement   and   recognition
requirements  of  EITF  No.  03-1.  The  delay  of the  effective  date  for the
measurement  and  recognition  requirements  of EITF No. 03-1 will be superseded
concurrent  with the final issuance of FSP EITF 03-1-a.  Adopting the disclosure
provisions of EITF No. 03-1 did not have any impact on the  Company's  financial
position or results of operations.

Other  accounting  standards  that have been  issued or  proposed by the FASB or
other standards-setting  bodies that do not require adoption until a future date
are not  expected  to  have a  material  impact  on the  consolidated  financial
statements upon adoption.



                                       7
<PAGE>


                             DEKALB BANKSHARES, INC.
                     Notes to Condensed Financial Statements
                                   (Unaudited)

Note 3 - Stock-Based Compensation

The Company has a stock-based employee  compensation plan which is accounted for
under the recognition and measurement  principles of Accounting Principles Board
("APB") Opinion No. 25, "Accounting for Stock Issued to Employees",  and related
Interpretations.  No stock-based employee  compensation cost is reflected in the
net income, as all stock options granted under these plans had an exercise price
equal to the market value of the  underlying  common stock on the date of grant.
The following table illustrates the effect on net income and earnings per common
share as if the Company had applied  the fair value  recognition  provisions  of
FASB SFAS No. 123,  "Accounting  for Stock-Based  Compensation",  to stock-based
employee compensation.

<TABLE>
<CAPTION>
                                                                                                 Six Months Ended June 30,
                                                                                                 -------------------------
                                                                                                2005                   2004
                                                                                                ----                   ----
<S>                                                                                        <C>                        <C>
Net income, as reported ....................................................               $     58,662               $   44,842
Deduct: Total stock-based employee
  compensation expense determined
  under fair value based method
  for all awards, net of related tax effects ...............................                      3,154                        -
                                                                                           ------------               ----------

Pro forma net income .......................................................               $     55,508               $   44,842
                                                                                           ============               ==========

Earnings per share:
  Basic - as reported ......................................................               $        .10               $      .07
                                                                                           ============               ==========
  Basic - pro forma ........................................................               $        .09               $      .07
                                                                                           ============               ==========

  Diluted - as reported ....................................................               $        .10               $      .07
                                                                                           ============               ==========
  Diluted - pro forma ......................................................               $        .09               $      .07
                                                                                           ============               ==========
</TABLE>

<TABLE>
<CAPTION>

                                                                                               Three Months Ended June 30,
                                                                                               ---------------------------
                                                                                              2005                         2004
                                                                                              ----                         ----
<S>                                                                                        <C>                        <C>
Net income, as reported ....................................................               $     33,993               $   26,335
Deduct: Total stock-based employee
  compensation expense determined
  under fair value based method
  for all awards, net of related tax effects ...............................                      3,154                        -
                                                                                           ------------               ----------

Pro forma net income .......................................................               $     30,839               $   26,335
                                                                                           ============               ==========

Earnings per share:
  Basic - as reported ......................................................               $        .06               $      .04
                                                                                           ============               ==========
  Basic - pro forma ........................................................               $        .05               $      .04
                                                                                           ============               ==========

  Diluted - as reported ....................................................               $        .06               $      .04
                                                                                           ============               ==========
  Diluted - pro forma ......................................................               $        .05               $      .04
                                                                                           ============               ==========
</TABLE>




                                       8
<PAGE>

                             DEKALB BANKSHARES, INC.

Note 4 - Earnings Per Share

A reconciliation  of the numerators and denominators used to calculate basic and
diluted  earnings  per share for the six month  periods  ended June 30, 2005 and
2004, and the three month periods ended June 30, 2005 and 2004 are as follows:

<TABLE>
<CAPTION>
                                                                                             Six Months Ended June 30, 2005
                                                                                             ------------------------------
                                                                                    Income              Shares             Per Share
                                                                                  (Numerator)        (Denominator)           Amount
                                                                                  -----------        -------------           ------
Basic earnings per share
<S>                                                                                 <C>                <C>                   <C>
  Income available to common shareholders ...........................               $58,662            610,139               $.10
                                                                                                                             ====
Effect of dilutive securities
  Stock options .....................................................                     -              4,814
                                                                                    -------            -------               ----
Diluted earnings per share
  Income available to common shareholders
    plus assumed conversions ........................................               $58,662            614,953               $ 10
                                                                                    =======            =======               ====


<CAPTION>
                                                                                            Six Months Ended June 30, 2004
                                                                                            ------------------------------
                                                                                     Income             Shares             Per Share
                                                                                  (Numerator)       (Denominator)            Amount
                                                                                  -----------       -------------            ------
Basic earnings per share
<S>                                                                                 <C>                <C>                   <C>
  Income available to common shareholders ...........................               $44,842            609,060               $.07
                                                                                                                             ====
Effect of dilutive securities
  Stock options .....................................................                     -                  -
                                                                                    -------            -------               ----
Diluted earnings per share
  Income available to common shareholders
    plus assumed conversions ........................................               $44,842            609,060               $.07
                                                                                    =======            =======               ====


<CAPTION>
                                                                                         Three Months Ended June 30, 2005
                                                                                         --------------------------------
                                                                                    Income             Shares             Per Share
                                                                                 (Numerator)       (Denominator)             Amount
                                                                                 -----------       -------------             ------
Basic earnings per share
<S>                                                                                 <C>                <C>                   <C>
  Income available to common shareholders ...........................               $33,993            610,139               $.06
                                                                                                                             ====
Effect of dilutive securities
  Stock options .....................................................                                    5,659
                                                                                    -------            -------
Diluted earnings per share
  Income available to common shareholders
   plus assumed conversions .........................................               $33,993            615,798               $.06
                                                                                    =======            =======               ====

<CAPTION>
                                                                                           Three Months Ended June 30, 2004
                                                                                           --------------------------------
                                                                                     Income             Shares            Per Share
                                                                                  (Numerator)       (Denominator)           Amount
                                                                                  -----------       -------------           ------
Basic earnings per share
<S>                                                                                 <C>               <C>                   <C>
  Income available to common shareholders ...........................               $26,335           609,060               $.04
                                                                                                                            ====
Effect of dilutive securities
  Stock options .....................................................                     -                 -
                                                                                     ------           -------               ----
Diluted earnings per share
  Income available to common shareholders
   plus assumed conversions .........................................               $26,335           609,060               $.04
                                                                                    =======           =======               ====
</TABLE>



                                       9
<PAGE>

                             DEKALB BANKSHARES, INC.
                     Notes to Condensed Financial Statements
                                   (Unaudited)
Note 5 - Comprehensive Income
Comprehensive  income includes net income and other comprehensive  income, which
is defined as nonowner related  transactions in equity. The following table sets
forth the amounts of other  comprehensive  income  included in equity along with
the  related tax effect for the six month  periods  ended June 30, 2005 and 2004
and for the three month periods ended June 30, 2005 and 2004:
<TABLE>
<CAPTION>
                                                                                              Six Months Ended June 30, 2005
                                                                                              ------------------------------
                                                                                         Pre-Tax         (Expense)       Net-of-tax
                                                                                         Amount           Benefit           Amount
                                                                                         ------           -------           ------
Unrealized gains (losses) on securities:
<S>                                                                                     <C>               <C>              <C>
   Unrealized holding gains (losses) arising during the period ................         $(67,095)         $ 24,825         $(42,270)
   Plus: reclassification adjustment for gains (losses)
   realized in net income .....................................................                -                 -                -
                                                                                        --------          --------         --------
   Net unrealized gains (losses) on securities ................................          (67,095)           24,825          (42,270)
                                                                                        --------          --------         --------
Other comprehensive income (loss) .............................................         $(67,095)         $ 24,825         $(42,270)
                                                                                        ========          ========         ========

<CAPTION>
                                                                                             Six Months Ended June 30, 2004
                                                                                             ------------------------------
                                                                                      Pre-Tax          (Expense)       Net-of-tax
                                                                                       Amount           Benefit           Amount
                                                                                       ------           -------           ------
Unrealized gains (losses) on securities:
<S>                                                                                  <C>                <C>               <C>
   Unrealized holding gains (losses) arising during the period .............         $(201,347)         $  74,499         $(126,848)
   Plus: reclassification adjustment for gains (losses)
   realized in net income ..................................................                 -                  -                 -
                                                                                     ---------          ---------         ---------
   Net unrealized gains (losses) on securities .............................          (201,347)            74,499          (126,848)
                                                                                     ---------          ---------         ---------
Other comprehensive income (loss) ..........................................         $(201,347)         $  74,499         $(126,848)
                                                                                     =========          =========         =========

<CAPTION>
                                                                                             Three Months Ended June 30, 2005
                                                                                             --------------------------------
                                                                                        Pre-Tax          (Expense)       Net-of-tax
                                                                                         Amount           Benefit           Amount
                                                                                         ------           -------           ------
Unrealized gains (losses) on securities:
<S>                                                                                      <C>              <C>               <C>
   Unrealized holding gains (losses) arising during the period .................         $ 44,992         $(16,646)         $ 28,346
   Plus: reclassification adjustment for gains (losses)
   realized in net income ......................................................                -                -                 -
                                                                                         --------         --------          --------
   Net unrealized gains (losses) on securities .................................           44,992          (16,646)           28,346
                                                                                         --------         --------          --------
Other comprehensive income (loss) ..............................................         $ 44,992         $(16,646)         $ 28,346
                                                                                         ========         ========          ========

<CAPTION>
                                                                                              Three Months Ended June 30, 2004
                                                                                              --------------------------------
                                                                                        Pre-Tax         (Expense)       Net-of-tax
                                                                                        Amount           Benefit           Amount
                                                                                        ------           -------           ------
Unrealized gains (losses) on securities:
<S>                                                                                  <C>                <C>               <C>
   Unrealized holding gains (losses) arising during the period .............         $(283,010)         $ 104,714         $(178,296)
   Plus: reclassification adjustment for gains (losses)
   realized in net income ..................................................                 -                  -                 -
                                                                                     ---------          ---------         ---------
   Net unrealized gains (losses) on securities .............................          (283,010)           104,714          (178,296)
                                                                                     ---------          ---------         ---------
Other comprehensive income (loss) ..........................................         $(283,010)         $ 104,714         $(178,296)
                                                                                     =========          =========         =========
</TABLE>

Accumulated other comprehensive income consists solely of the unrealized gain on
securities available-for-sale, net of the deferred tax effects.


                                       10
<PAGE>

                             DEKALB BANKSHARES, INC.

Item 2. Management's Discussion and Analysis or Plan of Operation

The  following is a discussion  of our  financial  condition as of June 30, 2005
compared to December 31, 2004,  and the results of operations  for the three and
six  months  ended June 30,  2005 and 2004.  This  discussion  should be read in
conjunction with our consolidated  financial  statements and accompanying  notes
appearing in this report and in  conjunction  with the financial  statements and
related  notes and  disclosures  in our 2004 Annual  Report on Form 10-KSB filed
with  the   Securities   and   Exchange   Commission.   This   report   contains
"forward-looking  statements"  relating to, without limitation,  future economic
performance,  plans and  objectives of  management  for future  operations,  and
projections of revenues and other financial items that are based on our beliefs,
as well as assumptions  made by and information  currently  available to us. The
words  "expect,"  "estimate,"  "anticipate,"  "plan," and  "believe," as well as
similar expressions,  are intended to identify forward-looking  statements.  Our
actual  results  may  differ  materially  from  the  results  discussed  in  the
forward-looking  statements,  and the our operating  performance each quarter is
subject to various risks and  uncertainties  that are discussed in detail in our
filings with the Securities and Exchange Commission.

Results of Operations

Net Interest Income

For the six months ended June 30, 2005, net interest income, the major component
of our net income was  $724,132,  compared to $640,740  for the six months ended
June 30, 2004, an increase of $83,392. For the three months ended June 30, 2005,
net interest income was $360,095  compared to $328,747 for the comparable period
of 2004. The  improvements  in the 2005 periods were primarily  attributable  to
increased  volume as we continued to build our loan portfolio.  The average rate
realized  on interest  earning  assets  increased  from 5.27% for the six months
ended  June 30,  2004 to 5.54% for the 2005  period.  The  average  rate paid on
interest  bearing  liabilities  increased  from 1.77% to 2.29%  during this same
period.  The net interest  spread and net interest  margin were 3.25% and 3.59%,
respectively,  for the six month period  ended June 30, 2005,  compared to 3.50%
and 3.77% for the six months  ended June 30, 2004.  The net interest  spread and
net  interest  margin  were 3.21% and 3.56%,  respectively,  for the three month
period  ended June 30,  2005,  compared to 3.53% and 3.79% for the three  months
ended June 30, 2004.


Provision and Allowance for Loan Losses

The  provision  for loan  losses is the  charge to  operating  earnings  that in
management's  judgment is necessary to maintain the allowance for loan losses at
an  adequate  level.  For the six  months  ended  June 30,  2005 and  2004,  the
provision was $37,502 and $39,000, respectively. For the three months ended June
30, 2005 and 2004,  the  provision  for loan  losses was  $15,002  and  $21,500,
respectively. There were no nonperforming loans at June 30, 2005 and $154,725 in
nonperforming  loans at June 30, 2004. There were no classified loans as of June
30, 2005 compared to $173,824 as of June 30, 2004. Based on present information,
we believe  the  allowance  for loan losses is adequate at June 30, 2005 to meet
probable losses  inherent in the loan  portfolio.  The allowance for loan losses
was 1.04% of total loans at June 30,  2005.  There are risks  inherent in making
all loans,  including  risks with respect to the period of time over which loans
may be repaid, risks resulting from changes in economic and industry conditions,
risks  inherent  in dealing  with  individual  borrowers,  and, in the case of a
collateralized  loan, risks resulting from uncertainties  about the future value
of the  collateral.  We maintain an  allowance  for loan losses  based on, among
other things, historical experience,  including management's experience at other
institutions,  an  evaluation  of economic  conditions,  and regular  reviews of
delinquencies and loan portfolio quality. Our judgment about the adequacy of the
allowance is based upon a number of assumptions  about future  events,  which we
believe to be reasonable, but which may not prove to be accurate. Thus, there is
a risk that  charge-offs  in future  periods could exceed the allowance for loan
losses or that substantial additional increases in the allowance for loan losses
could be required.  Additions to the allowance for loan losses would result in a
decrease of the Bank's net income and, possibly, its capital.



                                       11
<PAGE>


                             DEKALB BANKSHARES, INC.

Item 2. Management's Discussion And Analysis or Plan of Operation - continued

Noninterest Income
Total noninterest income for the six months ended June 30, 2005 was $214,019, an
increase of $83,172,  compared  to  $130,847  for the six months  ended June 30,
2004. Total noninterest  income for the quarter ended June 30, 2005 was $116,059
compared  to  $73,540  for the  comparable  period of 2004.  Service  charges on
deposit accounts decreased from $41,919 for the three months ended June 30, 2004
to $39,445 for the three months ended June 30, 2005.  Service charges on deposit
accounts  decreased  from  $73,834  for the six months  ended  June 30,  2004 to
$70,550  for the six  months  ended June 30,  2005.  Residential  mortgage  loan
origination fees increased from $24,317 for the three months ended June 30, 2004
to $67,465 for the  comparable  2005  period.  For the six months ended June 30,
2005,  residential mortgage loan origination fees totaled $123,624,  compared to
$42,649 for the same period in 2004. The increase of $80,975 is  attributable to
an increase in new residential  loan volume during the period due to a favorable
interest rate market and a more aggressive marketing strategy.


Noninterest Expense

Total  noninterest  expense  for the first six months of 2005 was  $806,627,  an
increase of $145,302,  when compared to the six months ended June 30, 2004.  For
the quarter ended June 30, 2005,  noninterest expense was $406,701,  an increase
of $67,407 over the comparable period of 2004.

The primary  component of  noninterest  expense is salaries and benefits,  which
were $ 440,729  and  $343,901  for the six months  ended June 30, 2005 and 2004,
respectively. Salaries and benefit expense totaled $225,071 and $182,072 for the
three  months  ended  June 30,  2005 and 2004,  respectively.  The  increase  in
salaries and benefit  expense is primarily  the result of staffing  additions to
support the growth of the bank. Other operating expenses increased from $253,607
for the six months ended June 30, 2004 to $299,708 for the six months ended June
30, 2005, also due to the overall growth of the Bank.  Other operating  expenses
for the three month  periods  ended June 30, 2005 and 2004 totaled  $149,102 and
$125,645, respectively.


Net Income

Net income for the six months  ended June 30, 2005 totaled  $58,662  compared to
$44,842  for  the  comparable  2004  period.  The net  earnings  are  after  the
recognition  of an income tax  expense of $35,360 and $26,420 for the six months
ended June 30, 2005 and 2004,  respectively.  The net  earnings  for the quarter
ended June 30, 2005 were $33,993  compared to $26,335 for the quarter ended June
30, 2004.  The net earnings were after the  recognition of income tax expense in
the amount of $20,458 and $15,158 for the three  months  ended June 30, 2005 and
2004, respectively.


Assets and Liabilities

During the first six  months of 2005,  total  assets  increased  $1,377,557,  or
3.24%,  when  compared to December  31, 2004.  The primary  growth in assets was
composed of an increase in loans receivable of $1,279,893 or 4.80% when compared
to December 31, 2004.  Securities  available for sale increased by $537,112,  or
5.60% when compared to December 31, 2004. Deposits decreased $256,372 during the
first six months of 2005 and advances from the Federal Home Loan Bank of Atlanta
("Federal Home Loan Bank") increased $1,600,000.


Investment Securities

Investment  securities  totaled  $10,703,691  as of June 30,  2005,  compared to
$10,069,198  at  December  31,  2004.  All  investments  in the  portfolio  were
designated as  available-for-sale  except for nonmarketable  equity  securities,
consisting of stock in the Federal Home Loan Bank,  which  totaled  $422,700 and
stock in Community Financial  Services,  Inc., which totaled $149,494 as of June
30, 2005.


                                       12
<PAGE>


                             DEKALB BANKSHARES, INC.

Item 2. Management's Discussion And Analysis or Plan of Operation - continued

Loans

Gross loans increased  $1,279,893 during the six months ended June 30, 2005. The
largest increase in loans was in construction  loans which increased  $2,519,028
to $4,945,237 as of June 30, 2005.  Balances  within the major loans  receivable
categories as of June 30, 2005 and December 31, 2004 are as follows:

                                                     June 30,       December 31,
                                                       2005             2004
                                                       ----             ----
Mortgage loans on real estate:
   Real estate 1- 4 family .................       $10,541,000       $10,029,077
   Commercial ..............................         7,972,161         7,699,603
   Construction ............................         4,945,237         2,426,209
   Second mortgages ........................           116,236            99,595
   Equity lines of credit ..................         2,252,651         1,880,511
                                                   -----------       -----------
       Total mortgage loans ................        25,827,285        22,134,995
Commercial and industrial ..................         1,027,635         3,278,822
Consumer and other .........................         1,068,010         1,229,220
                                                   -----------       -----------
       Total gross loans ...................       $27,922,930       $26,643,037
                                                   ===========       ===========

Risk Elements in the Loan Portfolio

The following is a summary of the risk elements in the loan portfolio:
                                                            June 30,    June 30,
                                                             2005         2004
                                                             ----         ----
Loans: Non-accrual .................................$             -     $154,725
Accruing loans more than 90 days past due ............            -            -
Loans identified by internal review mechanism:
   Criticized ........................................       17,299       19,098
   Classified ........................................            -      173,823


Activity in the Allowance for Loan Losses is as follows:

                                                    June 30,          June 30,
                                                     2005               2004
                                                     ----               ----
Balance, January 1, 2004 and 2005, respectively   $    266,478     $    305,000
Provision for loan losses for the period .......        37,502           39,000
Net loans (charged-off) recovered for the period       (12,190)         (18,792)
                                                  ------------     ------------

Balance, end of period .........................  $    291,790     $    325,208
                                                  ============     ============

Gross loans outstanding, end of period .........  $ 27,922,930     $ 23,945,738
                                                  ============     ============

Allowance for loan losses to loans outstanding .          1.04%            1.36%



                                       13
<PAGE>


                             DEKALB BANKSHARES, INC.

Item 2. Management's Discussion And Analysis or Plan of Operation - continued

Deposits

Total  deposits  decreased  $256,372,  or  0.91%,  from  December  31,  2004  to
$28,054,006 at June 30, 2005. The largest decrease was in time deposits $100,000
and  over,  which  decreased  $916,014,  or 7.17% to  $11,855,433.  The  largest
increase was in interest bearing transaction accounts, which increased $937,284,
or 27.17.

Balances  within the major  deposit  categories as of June 30, 2005 and December
31, 2004 are as follows:
                                                       June 30,     December 31,
                                                         2005           2004
                                                         ----           ----
Noninterest-bearing transaction accounts .......     $ 2,942,886     $ 2,788,768
Interest-bearing transaction accounts ..........       4,387,129       3,449,845
Savings ........................................       3,211,480       3,812,952
Time deposits $100,000 and over ................      11,855,433      12,771,447
Other time deposits ............................       5,657,078       5,487,366
                                                     -----------     -----------
       Total deposits ..........................     $28,054,006     $28,310,378
                                                     ===========     ===========

Advances from the Federal Home Loan Bank

Advances  from the Federal Home Loan Bank totaled  $7,500,000  at June 30, 2005,
and $5,900,000 at December 31, 2004. One of the advances  totaling $500,000 is a
convertible  advance with a call feature. It currently has a fixed interest rate
of 3.23%,  matures on September 6, 2011, and can be called on September 6, 2005.
Another advance of $1,000,000 was entered into on July 23, 2002 with an interest
rate of  3.87%  and a  maturity  date of  July  23,  2012.  This  advance  has a
"knockout"  provision  beginning on July 23, 2003,  that allows the Federal Home
Loan Bank to convert the advance to an  adjustable  rate  advance if the 3 Month
LIBOR rate exceeds 7.00%.  Another advance  totaling  $400,000 has an adjustable
interest rate of 3.38% as of June 30, 2005. Another advance totaling  $1,000,000
has a fixed interest rate of 2.47% and matures August 26, 2005. We also borrowed
$4,600,000  under the daily rate credit  program with a rate of 3.63% as of June
30, 2005 that is subject to change daily.

Securities Sold Under Agreements to Repurchase

Securities  sold under  agreements to  repurchase  totaled  $3,000,000,  with an
interest rate of 2.95% maturing January 20, 2007.

Liquidity

Our Company meets its liquidity  needs through cash and short-term  investments,
and scheduled maturities of loans on the asset side and through pricing policies
on the liability  side for  interest-bearing  deposit  accounts.  As of June 30,
2005, our Company's  primary  sources of liquidity  included  federal funds sold
totaling $1,795,000 and securities  available-for-sale totaling $10,131,497. The
Company also has lines of credit available with correspondent  banks to purchase
federal funds  totaling  $1,900,000  at June 30, 2005. In addition,  the Company
also has  borrowing  capacity  available  through the Federal Home Loan Bank. At
June 30, 2005, the Company's  ability to borrow funds from the Federal Home Loan
Bank totaled $8,787,384, of which the Company had borrowed $7,500,000 as of June
30, 2005.

Critical Accounting Policies

We have adopted  various  accounting  policies  which govern the  application of
accounting principles generally accepted in the United States in the preparation
of our financial statements.  Our significant  accounting policies are described
in the notes to the  consolidated  financial  statements at December 31, 2004 as
filed in our Annual Report on Form on Form 10-KSB.  Certain accounting  policies
involve significant judgments and assumptions by us which have a material impact
on the  carrying  value of certain  assets and  liabilities.  We consider  these
accounting  policies to be  critical  accounting  policies.  The  judgments  and
assumptions we use are based on historical  experience and other factors,  which
we believe to be reasonable  under the  circumstances.  Because of the nature of
the judgments and  assumptions  we make,  actual results could differ from these
judgments  and  estimates  which  could have a material  impact on our  carrying
values of assets and liabilities and our results of operations.

                                       14
<PAGE>

                             DEKALB BANKSHARES, INC.

Item 2. Management's Discussion And Analysis or Plan of Operation - continued

We believe the  allowance for loan losses is a critical  accounting  policy that
requires the most significant judgments and estimates used in preparation of our
consolidated financial statements.  Refer to the portions of this discussion and
the  discussion  in our 2004 Annual  Report on Form 10-KSB  that  addresses  our
allowance for loan losses for a description of our processes and methodology for
determining our allowance for loan losses.

Capital Resources

Total  shareholders'  equity  increased  $16,392 to $5,208,787 at June 30, 2005.
This is the  result of net  income  for the  period of  $58,662  and a  negative
adjustment of $42,270 for the unrealized loss on securities available for sale.

The Company and the Bank are subject to various regulatory capital  requirements
administered by the federal banking agencies.  Quantitative measures established
by regulation to ensure capital  adequacy  require the Bank to maintain  minimum
ratios  of  Tier  1  and  total   capital   as  a   percentage   of  assets  and
off-balance-sheet exposures,  adjusted for risk weights ranging from 0% to 100%.
Tier 1 capital of the Bank consists of common  stockholders'  equity,  excluding
the  unrealized  gain or loss on  securities  available-for-sale,  minus certain
intangible  assets. The Bank's Tier 2 capital consists of the allowance for loan
losses subject to certain  limitations.  Total capital for purposes of computing
the  capital  ratios  consists  of the sum of  Tier 1 and  Tier 2  capital.  The
regulatory  minimum  requirements  are 4% for Tier 1 and 8% for total risk-based
capital.

We are also  required to maintain  capital at a minimum  level based on adjusted
quarterly  average  assets,  which  is  known as the  leverage  ratio.  Only the
strongest  banks are allowed to maintain  capital at the minimum  requirement of
3%. All others are subject to maintaining ratios 1% to 2% above the minimum. The
Federal Reserve applies its capital adequacy guidelines on a bank only basis for
bank holding companies with less than $150 million in consolidated assets.

The following  table  summarizes  the Company's  risk-based  capital at June 30,
2005:

Shareholders' equity ............................................   $ 5,208,787
Plus: unrealized losses on available-for-sale securities ........        82,864
                                                                    -----------
Tier 1 capital ..................................................     5,291,651
Plus: allowance for loan losses includable in Tier 2 capital(1) .       291,790
                                                                    -----------
Total risk-based capital ........................................   $ 5,583,441
                                                                    ===========

Risk-weighted assets ............................................   $29,509,000
                                                                    ===========

Risk-based capital ratios
   Tier 1 capital (to risk-weighted assets) .....................         17.93%
   Total risk-based capital (to risk-weighted assets) ...........         18.92%
   Tier 1 capital (to total average assets) .....................         12.39%

(1) Limited to 1.25% of risk-weighted assets


Off-Balance Sheet Risk

Through its operations,  the Company has made contractual  commitments to extend
credit in the ordinary course of its business activities.  These commitments are
legally   binding   agreements  to  lend  money  to  the  Bank's   customers  at
predetermined  interest rates for a specified  period of time. At June 30, 2005,
the Company had issued  commitments  to extend credit of $5,770,756  and standby
letters  of credit of $83,030  through  various  types of lending  arrangements.
Approximately  $3,451,468  of these  commitments  to extend  credit had variable
rates.



                                       15
<PAGE>

                             DEKALB BANKSHARES, INC.

Item 2. Management's Discussion And Analysis or Plan of Operation -continued

The  following  table sets forth the  length of time until  maturity  for unused
commitments to extend credit and standby letters of credit at June 30, 2005.

<TABLE>
<CAPTION>
                                                   After One    After Three
                                     Within         Through        Through                        Greater
                                        One           Three         Twelve         Within            Than
(Dollars in thousands)                Month          Months         Months        One Year        One Year         Total
                                 -----------     -----------    -----------     ----------     -----------    -----------
Unused commitments
<S>                              <C>             <C>            <C>             <C>            <C>            <C>
   to extend credit ..........   $    20,231     $   436,803    $ 2,478,152     $2,935,186     $ 2,835,570    $ 5,770,756
Standby letters of
   credit ....................             -               -         15,000         15,000          68,030         83,030
                                 -----------     -----------    -----------     ----------     -----------    -----------
     Total ...................   $    20,231     $   436,803    $ 2,493,152     $2,950,186     $ 2,903,600    $ 5,853,786
                                 ===========     ===========    ===========     ==========     ===========    ===========
</TABLE>

Based on historical  experience,  many of the  commitments and letters of credit
will expire not fully funded. Accordingly,  the amounts shown in the table above
do not necessarily reflect the Company's need for funds in the periods shown.

The Company evaluates each customer's credit worthiness on a case-by-case basis.
The amount of  collateral  obtained,  if deemed  necessary  by the Company  upon
extension  of  credit,  is  based  on its  credit  evaluation  of the  borrower.
Collateral  varies but may include  accounts  receivable,  inventory,  property,
plant and equipment, commercial and residential real estate.


Item 3.  Controls and Procedures

Based  on  the  evaluation  required  by  17  C.F.R.  Section  240.13a-15(b)  or
240.15d-15(b) of the Company's disclosure controls and procedures (as defined in
17  C.F.R.  Sections  240.13a-15(e)  and  240.15d-15(e)),  the  Company's  chief
executive  officer and chief financial  officer concluded that such controls and
procedures,  as of the end of the period covered by this quarterly report,  were
effective.

There  has been no change  in the  Company's  internal  control  over  financial
reporting during the most recent fiscal quarter that has materially affected, or
is likely to materially  affect the Company's  internal  control over  financial
reporting.



                                       16
<PAGE>


                             DEKALB BANKSHARES, INC.

Part II - Other Information

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

     Incorporated  by reference to Item 4, Part II of the Company's  Form 10-QSB
for the quarter ended March 31, 2005.


Item 6. Exhibits

     Exhibit 31 - Certification  of Chief Executive  Officer and Chief Financial
     Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

     Exhibit 32 - Certification  of Chief Executive  Officer and Chief Financial
     Officer  pursuant to Section 906 of the  Sarbanes-Oxley  Act of 2002.  This
     exhibit  is not  "filed"  for  purposes  of  Section  18 of the  Securities
     Exchange  Act of 1934 but is instead  furnished  as provided by  applicable
     rules of the Securities and Exchange Commission.


































                                       17
<PAGE>


                             DEKALB BANKSHARES, INC.

                                    SIGNATURE

In accordance with 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.



                                        s/William C. Bochette, III
                               By:      ----------------------------------------
                                        William C. Bochette, III
                                        Chief Executive Officer, President, and
                                        Chief Financial Officer

Date: August 11, 2005





                                       18
<PAGE>

                             DEKALB BANKSHARES, INC.

Exhibit Index

31       Certification  of Chief Executive  Officer and Chief Financial  Officer
         pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32       Certification  of Chief Executive  Officer and Chief Financial  Officer
         pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. This exhibit
         is not "filed" for  purposes of Section 18 of the  Securities  Exchange
         Act of 1934 but is instead furnished as provided by applicable rules of
         the Securities and Exchange Commission.



                                       19