UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                  FORM 10-QSB

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

                For the Quarterly Period Ended September 30, 2004

                                       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 number   000-50554
                                             -------------

                              FNBG Bancshares, Inc.
                              ---------------------
             (Exact name of registrant as specified in its charter)

               Georgia                                   31-1830205
     -------------------------------         ----------------------------------
     (State of Jurisdiction of              (I.R.S. Employer Identification No.)
     Incorporation or organization)

     2734 Meadow Church Road
     Duluth,  Georgia                                       30097
     ----------------------------------    -------------------------------------
     (Address of principal executive                      (Zip Code)
      offices)

                                  770-476-7777
                                  ------------
                               (Telephone Number)


               ---------------------------------------------------
                          (Former name, former address
                             and former fiscal year,
                          if changed since last report)

     Check  whether  the  issurer: (1) filed all reports required to be filed by
Section  13  or 15(d) of the Exchange Act 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  XX  NO
                                     ----

                      APPLICABLE ONLY TO CORPORATE ISSUERS

     State  the  number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:

     777,895  shares  of  common  stock,  $1.00  par value per share, issued and
outstanding as of September 30, 2004.

     Transitional Small Business Disclosure Format (check one): YES     NO  XX
                                                                    ---    ---


<PAGE>
                      FNBG BANCSHARES, INC. AND SUBSIDIARY

                                      INDEX

                                                                        Page No.
                                                                        --------

PART  I     FINANCIAL INFORMATION

   Item 1.  Financial Statements                                            3

            Balance Sheet (unaudited) at September 30, 2004                 3

            Statements of Income (unaudited) for the Three and Nine
            Months Ended September 30, 2004 and 2003                        4

            Statements of Comprehensive Income (unaudited) for
            the Three and Nine Months Ended September 30, 2004 and 2003     5

            Statements of Cash Flows (unaudited) for the Nine
            Months Ended September 30, 2004 and 2003                        6

            Notes to Financial Statements (unaudited)                       7-8

   Item 2.  Management's Discussion and Analysis of Financial
            Condition or Plan of Operations                                 9-11

   Item 3.  Controls and Procedures                                         11

PART  II.   OTHER INFORMATION

   Item 1.  Legal Proceedings                                               12

   Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds     12

   Item 3.  Defaults Upon Senior Securities                                 12

   Item 4.  Submission of Matters to a Vote of Security Holders             12

   Item 5.  Other Information                                               12

   Item 6.  Exhibits                                                        12




This  Report  contains  statements  which  constitute forward-looking statements
within  the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of  the  Securities Exchange Act of 1934. These statements appear in a number of
places in this Report and include all statements regarding the intent, belief or
current  expectations of the Company, its directors or its officers with respect
to,  among other things: (1) the Company's financing plans; (2) trends affecting
the  Company's  financial  condition or results of operations; (3) the Company's
growth  strategy  and operating strategy; and (4) the declaration and payment of
dividends.  Investors are cautioned that any such forward-looking statements are
not  guarantees  of  future performance and involve risks and uncertainties, and
that  actual  results  may  differ  materially  from


                                      - 2 -
<PAGE>
those projected in the forward-looking statements as a result of various factors
discussed  herein and those factors discussed in detail in the Company's filings
with  the  Office  of  the  Comptroller  of  the  Currency.


                                      - 3 -
<PAGE>
<TABLE>
<CAPTION>
                           PART I.  FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                        FNBG BANCSHARES, INC. AND SUBSIDIARY

                             CONSOLIDATED BALANCE SHEET

                                 SEPTEMBER 30, 2004
                                     (UNAUDITED)

                                       Assets
                                       ------

<S>                                                                    <C>
Cash and due from banks                                                 $ 2,531,579
Federal funds sold                                                        2,799,233
                                                                       -------------

      Cash and cash equivalents                                           5,330,812

Investment securities available for sale                                 11,330,422
Other investments                                                           482,800
Loans, net of allowance for loan losses of $1,096,378                    93,977,420
Premises and equipment, net                                               3,249,013
Accrued interest receivable and other assets                              1,610,760
                                                                       -------------

                                                                       $115,981,227
                                                                       =============

                      Liabilities and Stockholders' Equity
                      ------------------------------------

Liabilities:
Deposits:
Demand                                                                 $  9,209,027
Money market and NOW accounts                                            32,464,860
Savings                                                                     458,833
Time                                                                     58,184,419
                                                                       -------------

      Total deposits                                                    100,317,139

FHLB Borrowings                                                           5,000,000
Note payable                                                              2,000,000
Accrued interest payable and other liabilities                              306,856
                                                                       -------------

      Total liabilities                                                 107,623,995
                                                                       -------------

Stockholders' equity:
Common stock, $1 par value; authorized
    10,000,000 shares; 777,895 issued and outstanding                       777,895
Additional paid-in capital                                                6,980,459
Retained earnings                                                           628,619
Accumulated other comprehensive income                                      (29,741)
                                                                       -------------

      Total stockholders' equity                                          8,357,232
                                                                       -------------

                                                                       $115,981,227
                                                                       =============
</TABLE>


See accompanying notes to financial statements.


                                      - 4 -
<PAGE>
<TABLE>
<CAPTION>
                                      FNBG BANCSHARES, INC. AND SUBSIDIARY

                                              STATEMENTS OF INCOME

                                   FOR THE THREE MONTHS AND NINE MONTHS ENDED
                                           SEPTEMBER 30, 2004 AND 2003
                                                   (UNAUDITED)


                                                                  For Three Months        For the Nine Months
                                                                 Ended September 30,      Ended September 30,
                                                                 -------------------      -------------------
                                                                 2004         2003        2004          2003
                                                              -----------  ----------  -----------  ------------
<S>                                                           <C>          <C>         <C>          <C>
Interest income:
    Interest and fees on loans                                $ 1,527,985  $1,107,220  $ 4,115,748  $ 2,953,675
    Interest on federal funds sold                                  6,736       7,076       20,931       19,071
    Investment securities                                          90,059      53,157      253,867      175,348
    Interest on deposit with other banks                                0          32            0          480
                                                              -----------  ----------  -----------  ------------

    Total interest income                                       1,624,780   1,167,485    4,390,546    3,148,574

Interest expense:
    Deposits                                                      487,622     347,559    1,333,355    1,029,458
    Fed funds payable                                                 230         689          247        1,060
    FHLB borrowings                                                 4,435           -        4,435            -
    Notes payable                                                     386           -        1,371            -
                                                              -----------  ----------  -----------  ------------
    Total interest expense                                        492,673     348,248    1,339,408    1,030,518
                                                              -----------  ----------  -----------  ------------

    Net interest income                                         1,132,107     819,237    3,051,138    2,118,056

Provision for loan losses                                         100,000      77,500      294,746      251,500
                                                              -----------  ----------  -----------  ------------
    Net interest income after
      provision for loan losses                                 1,032,107     741,737    2,756,392    1,866,556
                                                              -----------  ----------  -----------  ------------

Other income:
    Service charges on deposit accounts                            55,725      62,245      168,527      173,116
    Other operating income                                          1,596      20,081        3,384       23,296
    Mortgage banking income                                        83,739     403,552      239,379      996,764
    Loss on sale of securities                                          -           -            -         (771)
                                                              -----------  ----------  -----------  ------------

        Total other income                                        141,060     485,878      411,290    1,192,405

Other expense:
    Salaries and other personnel expense                          461,720     554,015    1,315,265    1,480,918
    Occupancy and equipment expense                               118,351     108,335      341,991      323,141
    Other operating expense                                       214,623     207,093      682,794      578,519
                                                              -----------  ----------  -----------  ------------

        Total other expense                                       794,694     869,443    2,340,050    2,382,578
                                                              -----------  ----------  -----------  ------------

        Income before provision for income tax                    378,473     358,172      827,632      676,383
Provision for income taxes                                        137,223     127,549      312,829      247,368
                                                              -----------  ----------  -----------  ------------
        Net income                                            $   241,250  $  230,623  $   514,803  $   429,015
                                                              ===========  ==========  ===========  ============
Net earnings per common share based on average outstanding
  of 777,895 in 2004 and 2003.                                $       .31  $      .30  $       .66  $       .55
                                                              ===========  ==========  ===========  ============

Fully diluted net earnings per common share based on average
  outstanding shares of 819,452 in 2004 and 813,844 in 2003   $       .29  $      .28  $       .63  $       .53
                                                              ===========  ==========  ===========  ============
</TABLE>


See accompanying notes to financial statements


                                      - 5 -
<PAGE>
<TABLE>
<CAPTION>
                               FNBG BANCSHARES, INC. AND SUBSIDIARY

                          CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                  FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003
                                            (UNAUDITED)


                                                     For Three Months        For the Nine Months
                                                    Ended September 30,      Ended September 30,
                                                    -------------------      -------------------
                                                    2004         2003        2004         2003
                                                 -----------  ----------  -----------  -----------
<S>                                              <C>          <C>         <C>          <C>

Net income                                          241,250     230,623      514,803      429,015
                                                 -----------  ----------  -----------  -----------

Other comprehensive income, net of tax:
  Unrealized gains on investment
    securities available-for-sale                   187,383    (153,345)      26,053     (223,313)
  Less income tax expense related to investment
    securities available-for-sale                   (65,584)     53,671       (9,119)      78,159
                                                 -----------  ----------  -----------  -----------

      Total other comprehensive income              121,799     (99,674)      16,934     (145,154)
                                                 -----------  ----------  -----------  -----------

    Total comprehensive income                      363,049     130,949      531,737      283,861
                                                 ===========  ==========  ===========  ===========
</TABLE>


See accompanying notes to financial statements.


                                      - 6 -
<PAGE>
<TABLE>
<CAPTION>
                                      FNBG BANCSHARES, INC. AND SUBSIDIARY

                                     CONSOLIDATED STATEMENTS OF CASH FLOWS

                             FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003
                                                  (UNAUDITED)


                                                                                        2004           2003
                                                                                    -------------  ------------
<S>                                                                                 <C>            <C>
Cash flows from operating activities:
  Net income                                                                        $    514,803       429,015
  Adjustments to reconcile net income to net cash
    provided by operating activities:
      Provision for loan losses                                                          294,746       251,500
      Depreciation, amortization and accretion                                           280,472       268,729
      Loss on sale of security                                                                 -           771
      Change in:
        Accrued interest receivable and other assets                                      16,467       (79,576)
        Accrued interest payable and other liabilities                                    36,785       108,801
                                                                                    -------------  ------------

          Net cash provided by operating activities                                    1,143,273       979,240
                                                                                    -------------  ------------

Cash flows from investing activities:

  Purchase of investment securities available for sale                                (4,052,284)   (6,262,909)
  Proceeds from calls, maturities, and paydowns - available for sale                   1,432,834     4,148,337
  Purchase of other investments                                                         (138,300)      (50,450)
  Redemption of time deposit                                                                   -        99,000
  Sale of securities - available for sale                                                      -       775,500
  Purchase of OREO                                                                      (757,295)            -
  Proceeds from sale of OREO                                                                   -       750,000
  Net increase in loans                                                              (24,831,627)  (19,376,222)
  Purchase of premises and equipment                                                     (95,109)      (70,181)
  Proceeds from sale of premises and equipment                                                 -       550,000
                                                                                    -------------  ------------

          Net cash used by investing activities                                      (28,441,781)  (19,436,925)

Cash flows from financing activities:
  Net increase in deposits                                                            20,254,664    17,779,965
  Proceeds from borrowings                                                             7,000,000             -
                                                                                    -------------  ------------

          Net cash provided by financing activities                                   27,254,664    17,779,965
                                                                                    -------------  ------------

Net change in cash and cash equivalents                                                  (43,844)     (677,720)

Cash and cash equivalents at beginning of the period                                   5,374,656     5,444,417
                                                                                    -------------  ------------

Cash and cash equivalents at end of the period                                      $  5,330,812     4,766,697
                                                                                    =============  ============

Non-cash investing activities:
  Change in unrealized gains (losses) on securities available for sale, net of tax  $     16,153      (145,155)

Supplemental disclosure of cash flow information:
  Cash paid during the period for interest                                          $  1,283,871     1,040,235
  Cash paid for taxes                                                               $    337,250       164,000
</TABLE>


See accompanying notes to financial statements.


                                      - 7 -
<PAGE>
                      FNBG BANCSHARES, INC. AND SUBSIDIARY

                    NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


(1)  BASIS OF PRESENTATION
     Effective  January 1, 2004, shareholders of First National Bank of Gwinnett
     exchanged  their  common  shares  for  a  like  number  of  shares  in FNBG
     Bancshares,  Inc.  $1  par  value  common  stock. FNBG Bancshares is a Bank
     Holding  Company  and  will  undergo  periodic  examinations by the Federal
     Reserve.  All significant intercompany transactions have been eliminated in
     consolidation.  The  statements  of  income,  comprehensive income and cash
     flows  for the nine months ended September 30, 2004 include the accounts of
     First  National  Bank  of  Gwinnett  and  FNBG Bancshares, Inc. while those
     statements  for  the  nine months ended September 30, 2003 include only the
     accounts  of  First  National  Bank  of  Gwinnett.

     The  interim financial statements included herein are unaudited but reflect
     all  adjustments  which,  in the opinion of management, are necessary for a
     fair  presentation  of the financial position and results of operations for
     the  interim  period  presented.  All  such  adjustments  are  of  a normal
     recurring  nature. The results of operations for the period ended September
     30,  2004  are  not  necessarily indicative of the results of a full year's
     operations.

     The  accounting principles followed by the Bank and the methods of applying
     these  principles  conform  with  generally  accepted accounting principles
     (GAAP) and with general practices within the banking industry. In preparing
     financial  statements  in  conformity  with GAAP, management is required to
     make  estimates  and  assumptions  that  affect the reported amounts in the
     financial  statements. Actual results could differ significantly from those
     estimates.  Material  estimates  common  to  the  banking industry that are
     particularly  susceptible  to  significant change in the near term include,
     but  are  not  limited  to,  the  determinations  of the allowance for loan
     losses, the valuation of real estate acquired in connection with or in lieu
     of  foreclosure on loans, and valuation allowances associated with deferred
     tax  assets,  the  recognition of which are based on future taxable income.

(2)  CASH AND CASH EQUIVALENTS
     For  presentation  in  the  financial statements, cash and cash equivalents
     include  cash  on  hand,  amounts  due  from  banks and federal funds sold.

(3)  NET EARNINGS PER COMMON SHARE
     Net  earnings  per common share are based on the weighted average number of
     common  shares outstanding during the period while the effects of potential
     common  shares  outstanding  during  the  period  are  included  in diluted
     earnings  per share. Potential common shares are present for all periods in
     the  form  of  stock  options  and  stock  warrants.

(4)  STOCK BASED COMPENSATION
     Statement  of  Financial  Accounting  Standards  No.  123  ("SFAS  123"),
     "Accounting  for Stock-Based Compensation," encourages but does not require
     entities  to  compute  fair  value  of  options at the date of grant and to
     recognize  such  costs  as  compensation expense immediately if there is no
     vesting  period  or  ratably  over  the  vesting period of the options. The
     Company  has  chosen  not  to adopt the cost recognition principles of this
     statement  and,  as permitted by SFAS 123, accounts for stock options under
     Accounting Principles Board Opinion No. 25 and its related interpretations.
     Had  compensation  costs been determined upon the fair value of the options
     at  the time of the grant dates consistent with the method of SFAS No. 123,
     net  earnings  would  have reflected the proforma accounts in the following
     table:


                                      - 8 -
<PAGE>
<TABLE>
<CAPTION>
                                    FNBG BANCSHARES, INC. AND SUBSIDIARY

                            NOTES TO FINANCIAL STATEMENTS (UNAUDITED), CONTINUED

(5)  STOCK BASED COMPENSATION, CONTINUED

     Proforma Stock Compensation Table


                                                             For the Three Months          For the Nine Months
                                                              Ended September 30,          Ended September 30,
                                                             2004           2003          2004           2003
                                                         -------------  ------------  -------------  ------------
<S>                                                      <C>            <C>           <C>            <C>
     Net earnings as reported                            $    241,250   $   230,623   $    514,803   $   429,015
     Proforma stock-based compensation cost adjustments
     associated with new grants net of tax                     (1,382)       (1,145)        (4,146)       (3,435)
                                                         -------------  ------------  -------------  ------------
     Proforma net earnings                               $    239,868   $   229,478   $    510,657   $   425,580
                                                         =============  ------------  =============  ============

     Basic Earnings per share, as reported               $        .31   $       .30   $        .66   $       .55
     Proforma stock-based compensation cost adjustments
     associated with new grants net of tax, per share               -             -              -             -
                                                         -------------  ------------  -------------  ------------
     Basic proforma earning, per share                   $        .31   $       .30   $        .66   $       .55
                                                         =============  ============  =============  ============

     Diluted earnings per share, as reported             $        .29   $       .28   $        .63   $       .52
     Proforma stock-based compensation cost adjustments
     associated with new grants net of tax, per share               -             -            .01             -
                                                         -------------  ------------  -------------  ------------
     Diluted proforma earnings, per share                $        .29   $       .28   $        .62   $       .52
                                                         =============  ============  =============  ============
</TABLE>

     The  fair  value of each option is estimated on the date of grant using the
     Minimum  Value pricing model with the following assumptions: dividend yield
     of  0%;  risk  free  interest  rate  at  the time of grant, of 4.25% and an
     expected  life  of  10  years.

(6)  BORROWED FUNDS
     Borrowings from the Federal Home Loan Bank of Atlanta ("FHLB") totaled $5.0
     million  at  September  30,  2004 compared to $0 at December 31, 2003. This
     increase  reflects $5.0 million in overnight FHLB borrowings resulting from
     short-term  borrowing  needs  in  September  2004.  The  $5.0  million  in
     borrowings  mature in 2006. The borrowings are secured by a blanket lien on
     1-4  family,  commercial, and multi-family residence loans. The Company had
     no  federal  funds  purchased  as  of  September  30,  2004.

     The  Company was extended a $3 million line of credit from Nexity Bank. The
     Company  has  drawn  and  received $2 million from the line of credit as of
     September 30, 2004. Outstanding indebtedness under the line of credit bears
     interest  at  prime  minus  1% and matures in 2016 with the first two years
     requiring  payments  of  interest  only and the remaining ten years require
     payments of principal plus interest. The line of credit is secured by First
     National  Bank  of  Gwinnett  stock.

(7)  RECENT DEVELOPMENTS
     On  October  1,  2004,  the Company and Gainesville Bank and Trust ("GB&T")
     entered into a definitive merger agreement. According to the agreement, the
     Company  will  merge  with  and into GB&T, and each Company shareholder may
     elect  to  receive  one  of the three following options: (1) 1.38 shares of
     GB&T  common  stock for each share of Company common stock, (2) $30 in cash
     for  each  share  of  Company  common  stock,  or  (3)  a  percentage  of
     consideration  he  or  she  wishes  receive  in  cash  and  a percentage of
     consideration  he or she wishes to receive in Company common stock, subject
     to  the  overall  limitation that the aggregate cash consideration will not
     exceed  $8,753,760. The merger is expected to close in the first quarter of
     2005  and is subject to certain customary closing conditions and regulatory
     approval.


                                      - 9 -
<PAGE>
ITEM 2.
                      FNBG BANCSHARES, INC. AND SUBSIDIARY

           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                              OR PLAN OF OPERATIONS

              For the Nine Months Ended September 30, 2004 and 2003

     FORWARD-LOOKING STATEMENTS
     --------------------------

     The following is our discussion and analysis of certain significant factors
that have affected our financial position and operating results and those of our
subsidiary, First National Bank of Gwinnett, during the periods included in the
accompanying financial statements. This commentary should be read in conjunction
with the financial statements and the related notes and the other statistical
information included in this report.

     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 the beliefs of management, as well as assumptions made by and
information currently available to management. The words "may," "will,"
"anticipate," "should," "would," "believe," "contemplate," "expect," "estimate,"
"continue," and "intend,", as well as other similar words and expressions of the
future, are intended to identify forward-looking statements. Our actual results
may differ materially from the results discussed in the forward-looking
statements, and 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, including, without limitation:

     -    Significant  increases  in  competitive  pressure  in  the banking and
          financial  services  industries;
     -    Changes  in  the  interest  rate  environment  which  could  reduce
          anticipated  or  actual  margins;
     -    Changes  in  political  conditions  or  the  legislative or regulatory
          environment;
     -    General  economic  conditions,  either  nationally  or  regionally and
          especially  in  primary  service  area,  becoming  less favorable than
          expected  resulting  in, among other things, a deterioration in credit
          quality;
     -    Changes  occurring  in  business  conditions  and  inflation;
     -    Changes  in  technology;
     -    The  level  of  allowance  for  loan  loss;
     -    The  rate  of  delinquencies  and  amounts  of  charge-offs;
     -    The  rate  of  loan  growth;
     -    Adverse  changes  in  asset  quality and resulting credit risk-related
          losses  and  expenses;
     -    Changes  in  monetary  and  tax  policies;
     -    Changes  in  the  securities  markets;  and
     -    Other  risks  and  uncertainties  detailed  from  time  to time in our
          filings  with  the  Securities  and  Exchange  Commission.

FINANCIAL CONDITION

     Total  assets  at  September  30,  2004  were  $115,981,227  representing a
$27,832,308  (31.57%)  increase from December 31, 2003. Total loans at September
30,  2004 were $95,073,798, an increase of $24,773,151 (35.24%) over total loans
at  December  31,  2003.  The  increase  in  loan  volume is due primarily to an
increase  in loans to finance construction.  Investment securities held for sale
September  30,  2004  were  $11,330,422, an increase of $2,574,641 (29.41%) over
investment  securities  held  for  sale at December 31, 2003.  The allowance for
loan  losses  at  September 30, 2004 was $1,096,378 compared to the December 31,
2003  balance  of  $854,000,  representing 1.15% of total loans at September 30,
2004,  compared  to  1.21%  at  December 31, 2003.  Cash and cash equivalents at
September  30,  2004  decreased $43,844 from December 31, 2003. At September 30,
2004,  the  net  loan  to  deposit  ratio  was  93.67%.

     Total  deposits  increased $20,254,664 (25.30%) from December 31, 2003. The
increase in total deposits was primarily due to the increase in NOW accounts and
Certificate  of  Deposits. The deposit mix at September 30, 2004 was as follows:
$9.2  million  (9%  of  total  deposits) in noninterest bearing demand deposits;
$32.4  million  (32%  of  total  deposits)  in interest checking accounts; $58.1
million  (58%  of  total  deposits)  in  time  deposits. The deposit mix remains
weighted  towards higher costing time deposits. We expect this trend to continue
due to competitive pressure in the marketplace, thus increasing the average cost
of  funds  and  potentially  reducing  the  bank's  net  interest  margin.


                                     - 10 -
<PAGE>
     The  Bank was most recently examined by its primary regulatory authority in
November  2003.  There  were no recommendations made by the regulatory authority
that  in  management's  opinion  are  expected  to have a material effect on the
Company's  liquidity,  capital  resources  or  operations.



RESULTS OF OPERATIONS

NET INTEREST INCOME
-------------------

     Net  interest income for the nine month period ended September 30, 2004 was
$3,051,138, an increase of $933,082 (44%) over the same period for 2003. For the
quarter ended September 30, 2004, net interest income was $1,132,107 compared to
$819,237 for the quarter ended September 30, 2003. Interest income for the first
nine  months  of  2004  was  $4,390,546  representing  an increase of $1,241,972
(39.45%)  over  the  same period in 2003.  Interest income for the quarter ended
September  30,  2004 was $1,624,780 compared to $1,167,485 for the quarter ended
September  30,  2003, an increase of $457,295 (39.16%). Interest expense for the
first  nine  months  of  2004  increased  $308,890 (29.97%) compared to the same
period  in  2003.  Interest expense for the quarter ended September 30, 2004 was
$492,673  compared  to  $348,248  for  the  quarter ended September 30, 2003, an
increase  of  $144,425  (41.47%). The increase in net interest income during the
first  nine  months  of  2004  compared  to the same period of 2003 is primarily
attributable  to the increase in the volume of loans and investments, as well as
an  increase  in  the  prime  interest  rate.

     For  the  nine months ended September 30, 2004, the Bank's yield on earning
assets was 6.10% while the cost of funding sources was 2.11%. While net interest
spread  was  3.99%,  net  interest  margin,  which  considers  the  effect  of
non-interest  bearing  deposits,  was  4.17%.

ALLOWANCE AND PROVISION FOR LOAN LOSSES
---------------------------------------

     The  Bank  analyzes its allowance for loan losses on a quarterly basis.  As
of  September  30,  2004,  the  provision  for loan losses expense was $294,746,
compared  to  $251,500 for the same period on 2003.  Management is providing the
provision  for  loan  losses  based  on  the  Bank's  internal Loan Loss Reserve
Calculation.  The  total allowance as of September 30, 2004 is $1,096,378. It is
management's  belief  that  the  allowance for loan losses is adequate to absorb
possible  losses  in  the  portfolio.

NONINTEREST INCOME AND EXPENSE
------------------------------

     Other  income for the first nine months of 2004 decreased $781,115 compared
to  the first nine months of 2003.  This decrease is primarily attributable to a
decrease  in fee income on mortgage loans originated. The decrease in fee income
on  mortgage  loans  originated is due to an increase in mortgage interest rates
and  the conclusion of the strong refinance market of 2003. Other income for the
quarter  ended  September  30,  2004  was $141,060, compared to $485,878 for the
quarter  ended September 30, 2003. This decrease of $344,818 is due to a decline
in  mortgage loan fee income of $319,813 compared to the quarter ended September
30,  2003.

     Other  expenses  for  the nine months of 2004 decreased $42,528 compared to
the  first  nine months in 2003. The net decrease is primarily attributable to a
decrease in expenses related to personnel expense resulting from the decrease in
mortgage  commissions  paid  which  was partially offset by an increase in other
operating  expenses.  Other  expenses  decreased  $74,749 from the quarter ended
September  30,  2004  compared  to  the  quarter  ended September 30, 2003. This
decline  was due to a decline in personnel expense resulting from the decline in
mortgage  commissions  paid.

LIQUIDITY
---------

     The  Bank  must  maintain,  on a daily basis, sufficient funds to cover the
withdrawals  from  depositors'  accounts and to supply new borrowers with funds.
To  meet  these  obligations,  the  Bank  keeps  cash on hand, maintains account
balances with its correspondent banks, and purchases and sells federal funds and
other  short-term  investments.  Asset and liability maturities are monitored in
an  attempt to match these maturities to meet liquidity needs.  It is the policy
of  the  Bank to monitor its liquidity to meet regulatory requirements and local
funding  requirements.

     The  Bank maintains relationships with correspondent banks that can provide
funds  to  it  on  short notice, if needed.  Presently the Bank has arrangements
with  three commercial banks for short term unsecured advances up to $6,000,000.
Currently  we  do not have any obligations outstanding on these lines of credit.


                                     - 11 -
<PAGE>
ITEM 2.
                      FNBG BANCSHARES, INC. AND SUBSIDIARY

           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                        OR PLAN OF OPERATIONS, CONTINUED
CAPITAL
-------

     The  following  tables present First National Bank of Gwinnett's regulatory
     capital  position  at  September  30,  2004:

     Risk-Based Capital Ratios
     -------------------------

     Tier 1 Tangible Capital, Actual                              10.24%
     Tier 1 Tangible Capital minimum requirement                   4.00%
                                                                  ------

     Excess                                                        6.24%
                                                                 =======

     Total Capital, Actual                                        11.33%
     Total Capital minimum requirement                             8.00%
                                                                  ------

     Excess                                                        3.33%
                                                                  ======

     Leverage Ratio
     --------------

     Tier 1 Tangible Capital to adjusted total assets
       ("Leverage  Ratio")                                         9.59%
     Minimum leverage requirement                                  4.00%
                                                                  ------

     Excess                                                        5.59%
                                                                  ======

ITEM 3.  CONTROLS AND PROCEDURES

As of the date of this report, the Company carried out an evaluation, under the
supervision and with the participation of the Company's management, including
the Company's Chief Executive Officer and Chief Financial Officer, of the
effectiveness of the design and operation of the Company's disclosure controls
and procedures pursuant to Exchange Act Rule 13a-15.  Based upon that
evaluation, the Company's Chief Executive Officer and Chief Financial Officer
concluded that the Company's disclosure controls and procedures are effective in
timely alerting them to material information relating to the Company (including
its consolidated subsidiaries) that is required to be included in the Company's
periodic filings with the Securities and Exchange Commission.  There have been
no significant changes in the Company's internal controls or, to the Company's
knowledge, in other factors that could significantly affect those internal
controls during the Company's quarter ended September 30, 2004 that have
materially affected, or are reasonably likely to materially affect, the
Company's internal control over financial reporting.


                                     - 12 -
<PAGE>
PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

     There  are  no  material, pending legal proceedings to which the Company or
any  of  its  subsidiaries  is  a party or of which any of their property is the
subject.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

    (a)  Not applicable.
    (b)  Not applicable.
    (c)  Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         None.

ITEM 5.  OTHER INFORMATION

    (a)  Not applicable.
    (b)  Not applicable

ITEM 6.  EXHIBITS

         Exhibits:
         The  following  documents are incorporated by reference and made a part
         of this report.

         Exhibit
         Number     Exhibit
         ------     -------

          3.1    Articles of Incorporation  of FNBG Bancshares, Inc., as amended
                 (filed as Exhibit 3.1 to the Bank's registration statement Form
                 SB-2 filed on  February  14, 2000, as amended (the "SB-2"), and
                 incorporated herein by reference).

          3.2    Bylaws of FNBG Bancshares, Inc., as amended (filed as Exhibit
                 3.2 to the SB-2 and incorporated herein by reference).

          4.1    See  Exhibits  3.1  and  3.2  for  provisions  of  Articles  of
                 Incorporation and Bylaws, as amended, which define the rights
                 of the holders of common stock of the Bank.

          10.1   Employment  Agreement  with  Terry C. Evans dated August 11,
                 1999 (filed as Exhibit 10.1 to the SB-2 and incorporated
                 herein by reference).

          31.1   Certification  pursuant  to  Rule  13a-14  under the Securities
                 Exchange Act of 1934, as amended.

          31.2   Certification  pursuant  to  Rule  13a-14  under the Securities
                 Exchange Act of 1934, as amended.

          32.1   Certification  pursuant  to  18 U.S.C. Section 1350, as adopted
                 pursuant to Section 906 of the Sarbanes-Oxley  Act of 2002.


                                     - 13 -
<PAGE>
                                   SIGNATURES


     Pursuant  to  the  requirements  of  Section  13 or 15(d) 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.

                                       FNBG BANCSHARES, INC.
                                       (Registrant)


     Date: November 10, 2004           By: /s/ Terry C. Evans
           -----------------               -------------------------------------
                                           Terry C. Evans
                                           President and Chief Executive Officer


     Date: November 10, 2004           By: /s/ Martha E. Brown
           -----------------               -------------------------------------
                                           Martha E. Brown
                                           Chief Financial Officer


                                     - 14 -
<PAGE>