U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

[x]      ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934
                     For fiscal year ended December 31, 2000

[  ]     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
           For the transition period from ________________ to _______________


                         Commission file number 0-23550

                              FENTURA BANCORP, INC.
             (Exact name of registrant as specified in its charter)

          Michigan                                        38-2806518
(State or other jurisdiction of                (IRS Employer Identification No.)
 incorporation or organization)

175 North Leroy, Fenton, Michigan                           48430-0725
(Address of Principal Executive Offices)                    (Zip Code)

Registrant's telephone number, including area code (810) 750-8725

Securities registered under Section 12(b) of the Exchange Act:  None

Securities registered under Section 12(g) of the Exchange Act:  Common Stock

Indicate by check mark whether the registrant (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. __X__ Yes ___ No

Indicate by check mark if disclosure  of  delinquent  filers in response to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

Aggregate  market  value  of the  voting  stock  held by  non-affiliates  of the
registrant  computed by  reference  to the average bid and asked  prices of such
stock was approximately $45,067,950 as of March 13, 2001.

State the number of shares  outstanding  of each of  issuer's  classes of common
equity, as of the latest  practicable date.  1,725,089 shares of Common Stock as
of March 13, 2001.


                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Fentura Bancorp,  Inc. Proxy Statement for its annual meeting of
shareholders  to be held  April 25,  2001 and its Rule 14a-3  annual  report are
incorporated by reference into Parts II and III.
<PAGE>
                              Fentura Bancorp, Inc.

                         2000 Annual Report on Form 10-K

                                Table Of Contents

                                                                            Page
PART I
   Item 1.    Description of Business                                          3
   Item 2.    Description of Property                                          6
   Item 3.    Legal Proceedings                                                6
   Item 4.    Submission of Matters to a Vote of Security Holders              6
   Additional Item - Executive Officers of Registrant                          6

PART II
   Item 5.    Market for Registrant's Common Equity and Related
              Stockholder Matters                                              7
   Item 6.    Selected Financial Data                                          7
   Item 7.    Management's Discussion and Analysis of Financial
              Condition and Results of Operations                              7
   Item 7a.   Quantitative and Qualitative Disclosures About Market Risk       7
   Item 8.    Financial Statements and Supplementary Data                      8
   Item 9.    Changes in and Disagreements with Accountants on Accounting
              and Financial Disclosure                                         8

PART III
   Item 10.  Directors and Executive Officers of the Registrant                8
   Item 11.  Executive Compensation                                            8
   Item 12.  Security Ownership of Certain Beneficial Owners and Management    8
   Item 13.  Certain Relationships and Related Transactions                    8

PART IV
   Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K   9

SIGNATURES                                                                    10

EXHIBIT INDEX                                                                 11

                                                                               2
<PAGE>
                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

The Company

     Fentura Bancorp,  Inc. (the "Company" or "Fentura") is a financial  holding
company  headquartered  in Fenton,  Michigan.  As of December 31, 2000,  Fentura
owned two banks,  see "The Banks" below. All information in this Item 1 is as of
December 31, 2000. The Company's subsidiary banks operate nine community banking
offices  offering a full range of banking  services  principally to individuals,
small business, and government entities throughout mid-Michigan. At the close of
business on December 31, 2000 the Company had assets of $293  million,  deposits
of $249 million,  and  shareholders'  equity of $36 million.  Trust assets under
management totaled $64 million.

     Fentura was  incorporated  in 1987 to serve as the  holding  company of its
sole  subsidiary  bank,  The State Bank ("TSB" or the  "Banks").  TSB traces its
origins to its  predecessor,  The Commercial  Savings Bank of Fenton,  which was
incorporated  in  1898.  See  "The  Banks".  On March  13,  2000 a  second  bank
subsidiary, Davison State Bank ("DSB" or the "Banks") commenced operation.

     In  August of 2000  Fentura  converted  from a bank  holding  company  to a
financial holding company  registered with the Board of Governors of the Federal
Reserve System under the Bank Holding Company Act and the Gramm-Leach-Bliley Act
(the "GLB Act"). The Company has corporate power to engage in such activities as
permitted to business  corporations under the Michigan Business Corporation Act,
subject  to the  limitations  of the Bank  Holding  Company  Act and GLB Act and
regulations of the Board of Governors of the Federal Reserve System. In general,
the Bank Holding Company Act and  regulations  restrict the Company with respect
to its own activities that are closely  related to the business of banking.  The
GLB Act and regulations  expand the authority of bank holding companies that are
also  financial  holding   companies   allowing  them  to  enter  into  business
combinations with other financial  institutions,  including insurance companies,
and securities firms to create a single financial services organization in order
to offer customers a more complete array of financial products and services. See
"Supervision and Regulation."

     The Company's  principal  executive offices are located at 175 North Leroy,
Fenton, Michigan 48430-0725, and its telephone number is (810) 750-8725.

The Banks

     TSB's original  predecessor was incorporated as a state banking corporation
under the laws of Michigan on September 16, 1898 under the name "The  Commercial
Savings Bank of Fenton." In 1931,  it changed its name to State  Savings Bank of
Fenton,  and in 1988  became  The  State  Bank.  For over 100 years TSB has been
engaged in the  general  banking  business  in the Fenton,  Michigan  area.  Its
deposits are insured by the Federal Deposit Insurance  Corporation (the "FDIC"),
but it is not a member of the Federal  Reserve  System.  As a state bank,  it is
subject to federal  and state laws  applicable  to banks and to  regulation  and
supervision  by the FDIC and the  Michigan  Office of  Financial  and  Insurance
Services, Division of Financial Institutions. See "Supervision and Regulation."

     DSB commenced  operations on March 13, 2000,  and is engaged in the general
banking business in the Davison,  Michigan area. Its deposits are insured by the
Federal Deposit  Insurance  Corporation (the "FDIC"),  but it is not a member of
the Federal Reserve System.  As a state bank, it is subject to federal and state
laws  applicable to banks and to regulation and  supervision by the FDIC and the
Michigan  Office of  Financial  and  Insurance  Services,  Division of Financial
Institutions. See "Supervision and Regulation."

     Both Banks are  community-oriented  providers of financial services engaged
in  the  business  of  general  commercial  banking.  Their  activities  include
investing in state and federal  securities,  accepting demand deposits,  savings
and other time deposits, extending retail commercial, consumer and real

                                                                               3
<PAGE>
estate loans to  individuals  and  businesses,  providing safe deposit boxes and
credit card services,  transmitting funds and providing other services generally
associated  with  full  service  commercial  banking.   Lending  is  focused  on
individuals  and small  businesses in the local market regions of the Banks.  In
addition,  TSB  operates a trust  department  offering a full range of fiduciary
services.

     TSB is  headquartered  in the City of Fenton,  Michigan,  and considers its
primary service area to be portions of Genesee, Oakland, and Livingston counties
in Michigan.  As of December 31, 2000,  TSB operated five offices in the City of
Fenton,  Michigan, one office in the City of Linden, Michigan, and one office in
the Village of Holly, Michigan. Its main office is located downtown Fenton.

     DSB is  headquartered in the Township of Davison,  Michigan,  and considers
its primary  service area to be portions of Genesee and Lapeer  Counties.  As of
December  31,  2000,  DSB  operated  two  offices in the  Township  of  Davison,
Michigan.

     As of December 31, 2000, TSB employed 106 full time personnel, including 26
officers,  and an additional 27 part time employees.  TSB considers its employee
relations to be excellent.

     As of December 31, 2000,  DSB employed 5 full time  personnel,  including 2
officers,  and an additional 10 part time employees.  DSB considers its employee
relations to be excellent.

Competition

     The financial  services industry is highly  competitive.  The Banks compete
with other  commercial  banks,  many of which are  subsidiaries  of bank holding
companies,  for loans, deposits, trust accounts, and other business on the basis
of interest  rates,  fees,  convenience  and quality of service.  The Banks also
compete  with a variety  of other  financial  services  organizations  including
savings and loan associations,  finance  companies,  mortgage banking companies,
brokerage firms,  credit unions and other financial  organizations.  Many of the
Banks' competitors have substantially greater resources than the Banks.

Supervision and Regulation

     The  following   discussion   briefly   summarizes   certain  statutes  and
regulations that affect or may affect the Company and the Banks, and the conduct
of their respective  businesses.  The discussion is qualified in its entirety by
reference to such statutes and regulations.

     The Company

     As a financial  holding  company,  within the  meaning of the GLB Act,  the
Company is subject to examination  and  supervision by the Board of Governors of
the  Federal  Reserve  System  (the  "Federal  Reserve  Board").  The Company is
required to file with the Federal  Reserve Board  reports and other  information
regarding  its  business   operations   and  the  business   operations  of  its
subsidiaries. It is also required to obtain Federal Reserve Board approval prior
to acquiring,  directly or indirectly,  ownership or control of voting shares of
any bank, if, after such acquisition it would own or control more than 5% of the
voting  stock of such bank.  Pursuant to the GLB Act,  however,  the Company may
engage in, or own or control companies that engage in, any activities determined
by the  Federal  Reserve  Board to be  financial  in  nature  or  incidental  to
activities  financial  in nature,  or  complementary  to  financial  activities,
provided that such complementary activities to do pose a substantial risk to the
safety  or  soundness  of  depository   institutions  or  the  financial  system
generally.  The GLB Act  designated  various  lending,  advisory,  insurance and
underwriting,  securities underwriting,  dealing and market making, and merchant
banking  activities (as well as those  activities  previously  approved for bank
holding  companies by the Federal  Reserve  Board) as  financial in nature,  and
authorized  the Federal  Reserve Board (in  coordination  with other  regulatory
authorities) to determine that additional  activities are financial in nature or
incidental to activities that are financial in nature. Prior to the GLB Act, the
Federal Reserve Board had determined that bank holding companies were permitted,
among  other  activities,  to engage,  subject to certain  limitations,  in such
banking  related  business  ventures as sales and  consumer  finance,  equipment
leasing,

                                                                               4
<PAGE>
computer  service bureau and software  operations,  data processing and services
transmission, discount securities brokerage, and mortgage banking and brokerage.

     In addition,  federal legislation  prohibits  acquisition of "control" of a
bank or bank  holding  company  without  prior  notice to certain  federal  bank
regulators.  "Control" in certain cases may include the acquisition of as little
as 10% of the outstanding shares of capital stock.

     The enactment of the  Gramm-Leach-Bliley  Act of 1999  represents a pivotal
point in the history of the financial services industry. The GLB Act sweeps away
large parts of a regulatory framework that had its origins in the Depression Era
of the 1930s.  Effective March 11, 2000, new opportunities  became available for
banks, other depository institutions,  insurance companies, and securities firms
to enter into combinations that permit a single financial services organization.
The GLB Act  provides a new  regulatory  framework  for  regulation  through the
"financial  holding  company,"  which has as its umbrella  regulator the Federal
Reserve  Board.   Functional  regulation  of  the  financial  holding  company's
separately regulated  subsidiaries will be conducted by their primary functional
regulator. In order to qualify as a financial holding company, the Company filed
an election to become a financial  holding  company  certifying that each of its
banks was "well capitalized" and "well managed." In addition,  the GLB Act makes
satisfactory  or  above  Community   Reinvestment  Act  compliance  for  insured
depository institutions and their financial holding companies necessary in order
for them to engage in new  financial  activities.  The GLB Act also  provides  a
federal  right to privacy  of  non-public  personal  information  of  individual
customers.  Holding  companies  and their  subsidiary  banks are also subject to
certain  state  laws  that  deal  with the use and  distribution  of  non-public
personal information.

     Substantially all of the Company's cash revenues are derived from dividends
paid by TSB. Michigan's banking laws restrict the payment of cash dividends by a
state bank by providing  (subject to certain  exceptions)  that dividends may be
paid only out of net profits then on hand after  deducting  therefrom its losses
and bad debts,  and no dividends may be paid unless the bank will have a surplus
amounting to not less than twenty percent (20%) of its capital after the payment
of the dividend. As a start up or de novo bank, Davison is not expected to pay a
dividend until 2003.

     The Banks

     The Banks are state banking  corporations  organized  under the laws of the
State of Michigan.  Consequently, they are subject to regulation and supervision
by the Commissioner of the Office of Financial and Insurance Services - Division
of Financial  Institutions  of the State of Michigan (the  "Commissioner").  The
Banks,  because their  deposits are, and will be,  insured by the FDIC, are also
subject to regulation and supervision by the FDIC.  Representatives  of both the
Commissioner and the FDIC conduct regular periodic  examinations of all Michigan
state  banks.  Membership  in the Federal  Reserve  System is optional for state
banks; the Banks are not members of the Federal Reserve System.

     The  Federal  Deposit  Insurance   Corporation   Improvement  Act  of  1991
("FDICIA"),  signed into law on December 19, 1991,  imposed on banks  relatively
detailed  standards  and  mandated the  development  of  additional  regulations
governing  nearly every aspect of the  operations  and  management of banks,  in
addition to many aspects of bank holding companies. Some of the major provisions
contained  in  FDICIA  includes  recapitalization  of the  Bank  Insurance  Fund
("BIF"),  a risk-based  insurance  premium  assessment  system,  a capital-based
supervision system that links supervisory intervention to the deterioration of a
bank's capital level, new auditing and accounting and examination  requirements,
and mandated standards for bank lending and operations.

     FDICIA  provides  the FDIC  with the  authority  to impose  assessments  on
insured  BIF  member  depository  institutions  to  maintain  the  fund  at  the
designated  reserve  ratio defined in FDICIA.  Assessment  levels are based on a
bank's level of capitalization. Banks with the highest capital level (i.e. "well
capitalized")  are  charged  the lowest  assessment.  The Banks have  sufficient
capital to maintain  this  designation  (the  FDIC's  highest  rating).  Further
regulatory  changes could impact the amount and type of  assessment  paid by the
Banks.

                                                                               5
<PAGE>
     Examinations  by the various  regulatory  authorities  are designed for the
protection  of  the  bank  depositors  and  not  for  bank  or  holding  company
shareholders.  The federal and state laws and regulations of general application
to banks  regulate,  among  other  things,  the scope of their  business,  their
investments,  their  reserves  against  deposits,  the  nature and amount of and
collateral for loans,  and the maximum  interest rates payable on deposits,  and
include restrictions on the number of banking offices and activities that may be
performed at such offices.

     Transactions  between  the Banks and the  Company  are  subject  to various
restrictions imposed by state and federal regulatory agencies. Such transactions
include  loans and other  extensions  of credit,  purchase  of  securities,  and
payments of fees and other  distributions.  In addition,  applicable  laws place
restrictions on the amount and nature of loans to executive officers,  directors
and controlling  persons of FDIC member banks and of bank holding companies that
control such banks.


ITEM 2.  DESCRIPTION OF PROPERTY

     The  Company's  executive  offices are  located at 175 North Leroy  Street,
Fenton,  Michigan,  which is also the main office of The State  Bank.  The State
Bank also has the  following  branches in Fenton:  a North Fenton Branch at 1231
North  Leroy  Street;  an Owen Road  branch at 3202 Owen Road (this  branch also
contains TSB's data processing center, accounting department,  and distributions
department),  a branch at 18005 Silver  Parkway,  and a loan office at 101 North
Leroy Street. The Bank's other branches are located in Linden,  Michigan, at 107
Main Street; and Holly,  Michigan,  at 4043 Grange Hall Road. Davison State Bank
is  headquartered  in Davison,  Michigan,  at 8477  Davison Road with one branch
location at 8503 Davison Road. The Company owns all of its  properties  with the
exception of the Holly,  Davison,  and the Silver Parkway facilities,  which are
leased from third parties.

     All  properties  have  maintenance  contracts  and are  maintained  in good
condition.


ITEM 3.  LEGAL PROCEEDINGS

     From time to time, the Company and its  subsidiaries are parties to various
legal proceedings  incident to their business.  At December 31, 2000, there were
no legal proceedings which management  anticipates would have a material adverse
effect on the Company.


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

     No items were  submitted  during the fourth  quarter of the year covered by
this  report  for  inclusion  to be voted on by  security  holders  through  the
solicitation of proxies or otherwise.


ADDITIONAL ITEM - EXECUTIVE OFFICERS OF REGISTRANT

     The following information  concerning executive officers of the Company has
been omitted from the  Registrant's  proxy statement  pursuant  Instruction 3 to
Regulation S-K, Item 401(b).

     Officers of the Company are appointed annually by the Board of Directors of
the Company and serve at the pleasure of the Board of Directors.  Certain of the
officers named below are appointed  annually by the Board of Directors of one or
the other of the Banks and serve at the  pleasure  of the Board of the Bank that
appointed  them.  The Bank  officers  are  included in the listing of  executive
officers  of  the  Company  because  of the  nature  of the  office  they  hold.
Information concerning these executive officers is given below:

       Donald  L.  Grill  (age  52) was  appointed  as  President  and  Chief
  Executive  Officer of the  Company  and of TSB in late  1996.  From 1983 to
  1996, Mr. Grill was employed by

                                                                               6
<PAGE>
  First of  America  Bank  Corporation  and  served  as  President  and Chief
  Executive Officer of First of America Bank - Frankenmuth.

       Ronald  L.  Justice  (age  36)  is the  Chief  Financial  Officer  and
  Secretary of the Company. Mr. Justice was promoted to Senior Vice President
  and Chief  Financial  Officer  of TSB in 1999 and  prior to that  served as
  Chief Financial  Officer and Vice President  since 1995.  Prior to that Mr.
  Justice held other positions with TSB.

       Robert E.  Sewick (age 51) is Senior  Vice  President  and Senior Loan
  Officer of TSB. Mr.  Sewick was appointed to that position in June of 1999.
  Mr. Sewick has 29 years of banking experience, most recently as Senior Vice
  President/Regional  Credit Officer of Huntington  National Bank for Western
  Michigan.

       John A.  Emmendorfer,  Jr. (age 38) was appointed  President and Chief
  Executive  Officer of Davison on February 24, 2000.  Prior to that time Mr.
  Emmendorfer  was an  employee  of TSB from  1988 to 1999 and most  recently
  served as TSB's Vice President and Director of Commercial Lending.


                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
         MATTERS

     The market and dividend information required by this item appears under the
caption "Fentura Bancorp, Inc. Common Stock" and "Table 17" on page 43 under the
title  "MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS",  of  the  Company's  2000  Rule  14a-3  annual  report,  and is
incorporated herein by reference.

     The holders of record  information  required by this item appears under the
caption "Stock Ownership  Information" on page 4 of the Company's 2001 Notice of
Annual Meeting of Shareholders and Proxy Statement,  and is incorporated  herein
by reference.


ITEM 6.  SELECTED FINANCIAL DATA

     The information required by this item appears under the title "MANAGEMENT'S
DISCUSSION  AND  ANALYSIS OF  FINANCIAL  CONDITION  AND RESULTS OF  OPERATIONS",
appearing in Table 1 on page 27 of the Company's  2000 Rule 14a-3 annual report,
and is incorporated herein by reference.


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

     The information required by this item appears under the title "MANAGEMENT'S
DISCUSSION  AND  ANALYSIS OF  FINANCIAL  CONDITION  AND RESULTS OF  OPERATIONS",
appearing on pages 27 through 43 of the Company's 2000 Rule 14a-3 annual report,
and is incorporated herein by reference.


ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The information required by this item appears under the headings "Liquidity
and Interest  Rate Risk  Management"  on pages 39 and 40 and  "Quantitative  and
Qualitative  Disclosure  About  Market  Risk" on pages 40 and 41 under the title
"MANAGEMENT'S  DISCUSSION  AND  ANALYSIS OF FINANCIAL  CONDITION  AND RESULTS OF
OPERATIONS" of the Company's 2000 Rule 14a-3 annual report,  and is incorporated
herein by reference.

                                                                               7
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The  consolidated  financial  statements of the Company and Report of Grant
Thornton LLP, Independent Auditors appear on pages 1 through 26 of the Financial
Statements  portion of the  Company's  2000 Rule 14a-3  annual  report,  and are
incorporated herein by reference.


ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
          AND FINANCIAL DISCLOSURE

     During the years  ended  December  31,  2000 and 1999,  the  Company had no
changes or disagreements with accountants on accounting and financial disclosure
required to be described in this item.


                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The Company's  Executive  officers are identified in  "Additional  Item" in
Part I of this Report on Form 10-K. The other information  required by this item
appears under the captions  "2001  Election of  Directors,"  "The  Corporation's
Board of Directors," "Committees of the Corporation Board," and "Compliance with
Section 16 Reporting" on pages 3, 4, 5, and 13,  respectively,  of the Company's
2001  Notice  of  Annual  Shareholders  Meeting  and  Proxy  Statement,  and  is
incorporated herein by reference.


ITEM 11.  EXECUTIVE COMPENSATION

     The information required by this item appears under the captions "Executive
Compensation,"  "Directors' Compensation," "Executive Compensation," "Retirement
and Change in Control  Arrangements" and "Shareholder  Return Performance Graph"
on pages 5 and 6, and 8 through 13,  respectively,  of the Company's 2001 Notice
of Annual Shareholders  Meeting and Proxy Statement,  and is incorporated herein
by reference.


ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The  information  required by this item  appears  under the caption  "Stock
Ownership of Directors,  Executive  Officers and Certain Major  Shareholders" on
page 4 of the  Company's  2001 Notice of Annual  Shareholders  Meeting and Proxy
Statement, and is incorporated herein by reference.


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The  information  required by this item  appears  under the caption  "Other
Information - Transactions  with Certain  Interested  Persons" on page 13 of the
Company's 2001 Notice of Annual Shareholders Meeting and Proxy Statement, and is
incorporated herein by reference.

                                                                               8
<PAGE>
                                     PART IV


ITEM 14.  EXHIBITS. FINANCIAL STATEMENT SCHEDULES,  AND REPORTS ON FORM 8-K

(a)  1.   Financial Statements:
               The following  consolidated  financial  statements of the Company
               and  Report  of Grant  Thornton  LLP,  Independent  Auditors  are
               incorporated by reference under Item 8 "Financial  Statements and
               Supplementary Data" of this document:
                      Consolidated Balance Sheets
                      Consolidated Statements of Income
                      Consolidated Statements of Comprehensive Income
                      Consolidated Statements of Changes in Stockholders' Equity
                      Consolidated Statements of Cash Flows
                      Notes to the Consolidated Financial statements
                      Report of Grant Thornton LLP, Independent Auditors

     2.   Financial Statement Schedules
          All schedules are omitted -- see Item 14(d) below.

     3.   Exhibits:
          The exhibits listed on the  "Exhibit  Index"  following  the signature
          page of this report are filed herewith  and are incorporated herein by
          reference.

(b)  Report on Form 8-K
     No reports on Form 8-K were filed  during the quarter  ended  December  31,
     2000.

(c)  Exhibits:
     The  "Exhibit  Index"  follows  the  signature  page of this  report and is
     incorporated herein by reference.

(d)  Financial Statement Schedules:
     All  financial  statement  schedules  normally  required  by  Article  9 of
     Regulation  S-X are  omitted  since they are either not  applicable  or the
     required  information is shown in the consolidated  financial statements or
     notes thereto.


                                                                               9
<PAGE>
                                   Signatures


     In accordance  with Section 13 or 15(d) of the  Securities  Exchange Act of
1934,  the  Registrant  caused  this  report to be  signed on its  behalf by the
undersigned, thereunto duly authorized .

Fentura Bancorp, Inc.
    (Registrant)

By  /s/Donald L. Grill                                 Date:  March 20, 2001
    Donald L. Grill
    On behalf of the registrant
      and as President & CEO,
      and Director

In accordance  with the  Securities  Exchange Act of 1934,  this report has been
signed below by the  following  persons on behalf of the  registrant  and in the
capacities and on the dates  indicated.  Each director of the Registrant,  whose
signature appears below,  hereby appoints Russell H. Van Gilder,  Jr. and Donald
L. Grill, and each of them severally,  as his or her  attorney-in-fact,  to sign
his or her name and on his or her behalf,  as a director of the Registrant,  and
to file with the Commission any and all amendments to this report on Form 10-K.

<TABLE>
        Signature                                    Capacity                                       Date
<S>                                           <C>                                              <C>
/s/Russell H. VanGilder, Jr.                  Chairman of the Board                            March 20, 2001
Russell H. VanGilder, Jr.                     and Director

/s/Forrest A. Shook                           Vice Chairman of the Board                       March 20, 2001
Forrest A. Shook                              Director

/s/David A. Duthie                            Director                                         March 20, 2001
David A. Duthie

/s/Peggy L. Haw-Jury                          Director                                         March 20, 2001
Peggy L. Haw-Jury

/s/J. David Karr                              Director                                         March 20, 2001
J. David Karr

/s/Thomas P. McKenney                         Director                                         March 20, 2001
Thomas P. McKenney

/s/Ronald L. Justice                          Chief Financial Officer and Secretary            March 20, 2001
Ronald L. Justice                             (Also Principal Accounting Officer)
</TABLE>

                                                                              10
<PAGE>
<TABLE>
                              FENTURA BANCORP, INC.
                         2000 Annual Report on Form 10-K
                                  EXHIBIT INDEX

   Exhibit
     No.                             Exhibit                                                             Location
----------------------------------------------------------------------------------------------------------------------
<S>             <C>                                                                                      <C>
     3(i)       Articles of Incorporation of Fentura Bancorp, Inc.                                          *

    3(ii)       Bylaws of Fentura Bancorp, Inc.                                                             *

   3(iii)       Amendment to the Articles of Incorporation of Fentura Bancorp, Inc. (Filed herewith)

      4.1       Dividend Reinvestment Plan                                                                 ***

     10.7       Lease of Davison  Branch  Bank Site  between  The State Bank and VG's Food  Center,         *
                Inc. dated April 27, 1993

    10.10       Lease of Fenton  Silver  Parkway  Branch site  between The State Bank and VG's Food         **
                Centers dated March 26, 1996

    10.11       Lease of Davison  (second) Branch site between The State Bank and VG'S Food Centers        ****
                dated November 12, 1996

    10.12       Directors Stock Purchase Plan                                                              ***

    10.13       Non-Employee Director Stock Option Plan                                                    ***

    10.14       Form of Non-Employee Director Stock Option Agreement                                        **

    10.15       Retainer Stock Plan for Directors                                                          ***

    10.16       Employee Stock Option Plan                                                                 ***

    10.17       Form of Employee Stock Option Plan Agreement                                               ***

    10.18       Executive Stock Bonus Plan                                                                 ***

    10.19       Stock  Purchase Plan between The State Bank and Donald E. Johnson,  Jr., Mary Alice        ****
                J. Heaton, and Linda J. LeMieux dated November 17, 1996

    10.20       Severance  Compensation  Agreement between the Registrant and Donald L. Grill dated       *****
                March 20, 1997

    13.00       Rule 14a-3 Annual Report to Security Holders (Filed herewith)

    21.1        Subsidiaries of the Registrant (Filed herewith)

   23.1         Consent of Independent Accountants (Filed herewith)
</TABLE>
*               Incorporated by reference to Form 10-SB Registration Number
                0-23550
**              Incorporated by reference to Form 10Q-SB filed on May 2, 1996
***             Incorporated by reference to Form 10K-SB filed on March 17, 1996
****            Incorporated by reference to Form 10K-SB filed March 20,. 1997
*****           Incorporated by reference to Form 10Q-SB filed May 12, 1997

                                                                              11
<PAGE>
                                 EXHIBIT 3(iii)


                   AMENDMENT TO THE ARTICLES OF INCORPORATION


     Pursuant to the provisions of Act 284, Public Acts of 1972, the undersigned
corporation executes the following Certificate:

     1.       The present name of the corporation is: Fentura Bancorp, Inc.

     2.       The identification number assigned by the Bureau is:  403-566

     3.       Article III of the  Articles of Incorporation is hereby amended to
read as follows:

                                   ARTICLE III

          The  aggregate  number of shares of all classes of capital  stock that
     the Corporation shall have authority to issue is 5,000,000 shares of Common
     Stock ("Common  Stock"),  all of which will be of the same class, with full
     voting   rights  and  powers  and  all  other  rights  and  powers  and  no
     qualifications, limitations or restrictions.

     4.       The foregoing amendment to the Articles of Incorporation  was duly
adopted  on the 26th day of April,  2000 by the  shareholders  at a meeting  the
necessary votes were cast in favor of the amendment.

     Signed this 28th day of April, 2000.


                                                 //s// Donald L. Grill
                                                 Donald L. Grill, President
<PAGE>
                                  EXHIBIT 13.00

                  RULE 14a-3 ANNUAL REPORT TO SECURITY HOLDERS







                       Financial Statements and Report of
                    Independent Certified Public Accountants

                              Fentura Bancorp, Inc.

                        December 31, 2000, 1999 and 1998




                                       and



                     Management's Discussion and Analysis of
                  Financial Condition and Results of Operations

<PAGE>
                                    Contents


                                                                            Page

Report of Independent Certified Public Accountants..........................   3

Financial Statements

    Consolidated Balance Sheets.............................................   4

    Consolidated Statements of Income.......................................   5

    Consolidated Statements of Comprehensive Income.........................   6

    Consolidated Statements of Stockholders' Equity.........................   7

    Consolidated Statements of Cash Flows...................................   8

    Notes to Consolidated Financial Statements..............................   9

Management's Discussion and Analysis of
  Financial Condition and Results of Operations.............................  27
<PAGE>
               Report of Independent Certified Public Accountants



Stockholders and Board of Directors
Fentura Bancorp, Inc.

We have audited the accompanying consolidated balance sheets of Fentura Bancorp,
Inc.  and  subsidiaries  as of  December  31,  2000 and  1999,  and the  related
consolidated statements of income,  comprehensive income,  stockholders' equity,
and cash flows for each of the three  years in the  period  ended  December  31,
2000. These financial  statements are the  responsibility  of the  Corporation's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audit to obtain  reasonable  assurance  about  whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Fentura
Bancorp,  Inc.  and  subsidiaries  as of  December  31,  2000 and 1999,  and the
consolidated  results of their  operations  and their cash flows for each of the
three years in the period ended December 31, 2000, in conformity with accounting
principles generally accepted in the United States of America.


/s/ Grant Thornton LLP


Southfield, Michigan
January 26, 2001
<PAGE>
                              Fentura Bancorp, Inc.

                           Consolidated Balance Sheets
                        (In Thousands, Except Share Data)

                                  December 31,

<TABLE>
                                                  ASSETS                                    2000             1999
                                                                                           --------        --------
<S>                                                                                       <C>             <C>
Cash and due from banks                                                                   $  13,459       $  12,714
Federal funds sold                                                                            7,250             900
                                                                                           --------        --------
                 Cash and cash equivalents                                                   20,709          13,614

Investment securities-available for sale, at market                                          53,421          53,964
Investment securities-held to maturity, at cost (market value of
    $13,419 and $13,774 in 2000 and 1999, respectively)                                      13,283          13,922
Loans held for sale                                                                             187             180
Loans, net of allowance for possible credit losses of $2,932
    and $2,961, respectively                                                                192,176         188,105
Bank premises and equipment, net                                                              6,547           5,200
Accrued interest receivable                                                                   1,924           1,687
Other assets                                                                                  4,643           6,949
                                                                                           --------        --------
                 TOTAL ASSETS                                                              $292,890        $283,621
                                                                                          =========       =========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
    Deposits
       Interest-bearing                                                                    $213,894        $215,527
       Noninterest bearing                                                                   34,762          31,524
                                                                                           --------        --------
                 Total deposits                                                             248,656         247,051

    Short-term borrowings                                                                     4,680           1,365
    Long-term debt                                                                            1,151           1,164
    Accrued taxes, interest and other liabilities                                             2,649           2,176
                                                                                           --------        --------
                 Total liabilities                                                          257,136         251,756

Stockholders' Equity
    Common stock, $2.50 par value;  5,000,000 shares  authorized,  1,722,308 and
       1,706,454 shares issued and outstanding in
       2000 and 1999, respectively                                                            4,305           3,555
    Capital surplus                                                                          26,016          18,317
    Retained earnings                                                                         5,648          11,078
    Accumulated other comprehensive loss                                                       (215)         (1,085)
                                                                                           --------        --------
                 Total stockholders' equity                                                  35,754          31,865
                                                                                           --------        --------
                 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                $292,890        $283,621
                                                                                          =========       =========
</TABLE>
        The accompanying notes are an integral part of these statements.

                                        4
<PAGE>
                              Fentura Bancorp, Inc.
                        Consolidated Statements of Income
                        (In Thousands, Except Share Data)
                            Years Ended December 31,
<TABLE>
                                                                                 2000         1999          1998
                                                                                -------      -------       -------
<S>                                                                             <C>           <C>           <C>
Interest income
    Loans                                                                        $18,710      $16,882       $17,487
    Investment securities
       Taxable                                                                     3,350        3,163         2,840
       Tax-exempt                                                                    624          577           515
    Short-term investments                                                           643          592           598
                                                                                 -------      -------       -------
                 Total interest income                                            23,327       21,214        21,440
Interest expense
    Deposits                                                                       9,266        7,881         8,487
    Short-term borrowings                                                             86           93           108
    Long-term debt                                                                   538           39            53
                                                                                 -------      -------       -------
                 Total interest expense                                            9,890        8,013         8,648
                                                                                 -------      -------       -------
Net interest income                                                               13,437       13,201        12,792
Provision for possible credit losses                                                 584          545           724
                                                                                 -------      -------       -------
Net interest income after provision for possible credit losses                    12,853       12,656        12,068
Noninterest income
    Service charges on deposit accounts                                            1,915        1,972         1,766
    Gain on sale of mortgages                                                        179          108           283
    Mortgage servicing                                                               631          153           181
    Fiduciary income                                                                 695          581           562
    Other income and fees                                                          1,108        1,424         1,124
    Security gains                                                                   -             24           112
                                                                                 -------      -------       -------
                 Total non-interest income                                         4,528        4,262         4,028
Noninterest expenses
    Salaries and employee benefits                                                 5,801        5,564         5,025
    Occupancy                                                                        784          797           723
    Furniture and equipment                                                        1,552        1,429         1,396
    Other general and administrative                                               3,299        3,346         3,404
                                                                                 -------      -------       -------
                 Total non-interest expenses                                      11,436       11,136        10,548
                                                                                 -------      -------       -------
Income before income taxes                                                         5,945        5,782         5,548
Provision for income taxes                                                         1,729        1,782         1,728
                                                                                 -------      -------       -------
                 NET INCOME                                                     $  4,216     $  4,000      $  3,820
                                                                                ========     ========      ========
Net income per common share
    Basic                                                                       $   2.46     $   2.36      $   2.28
    Diluted                                                                         2.45     $   2.35      $   2.28
Cash dividends per share                                                        $    .97     $    .93      $    .88

</TABLE>
        The accompanying notes are an integral part of these statements.

                                        5
<PAGE>
                              Fentura Bancorp, Inc.

                 Consolidated Statements of Comprehensive Income
                        (In Thousands, Except Share Data)
                            Years Ended December 31,
<TABLE>
                                                                                2000           1999          1998
                                                                               -------        ------         ------
<S>                                                                           <C>             <C>            <C>
Net income                                                                    $  4,216        $4,000         $3,820

Other comprehensive income, net of tax:
    Unrealized holding gains (losses) arising
       during the year                                                             870        (1,262)           208

    Less:  reclassification adjustment for gains
       included in net income                                                      -              16             74
                                                                               -------        ------         ------
Other comprehensive income (loss)                                                  870        (1,278)           134
                                                                               -------        ------         ------
COMPREHENSIVE INCOME                                                          $  5,086        $2,722         $3,954
                                                                              ========       =======        =======
</TABLE>



        The accompanying notes are an integral part of these statements.

                                        6
<PAGE>
                              Fentura Bancorp, Inc.

                 Consolidated Statements of Stockholders' Equity
                        (In Thousands, Except Share Data)
                  Years Ended December 31, 2000, 1999 and 1998

<TABLE>
                                                                                                 Accumulated
                                                                                                    Other
                                                                                                Comprehensive            Total
                                                    Common        Capital      Retained            Income            Stockholders'
                                                    Stock         Surplus      Earnings            (Loss)               Equity
                                                    -------       -------       --------         -------------       -----------
<S>                                                 <C>           <C>           <C>              <C>                 <C>
Balance, January 1, 1998                            $3,462        $16,913         $6,308          $   59               $26,742
    Net income                                         -              -            3,820               -                 3,820
    Cash dividends ($.88 per share)                    -              -           (1,464)              -                (1,464)
    Issuance of shares under stock
       purchase plans                                   59            731            -                 -                   790
    Other comprehensive income                         -              -              -                 134                 134
                                                    ------        -------         ------            ------             -------
Balance, December 31, 1998                           3,521         17,644          8,664               193              30,022
    Net income                                         -              -            4,000               -                 4,000
    Cash dividends ($.93 per share)                    -              -           (1,586)              -                (1,586)
    Issuance of shares under
      stock purchase plans                              34            673            -                 -                   707
    Other comprehensive loss                           -              -              -              (1,278)             (1,278)
                                                    ------        -------         ------            ------             -------
Balance, December 31, 1999                           3,555         18,317         11,078            (1,085)             31,865
    Net income                                         -              -            4,216               -                 4,216
    Cash dividends ($.97 per share)                    -              -           (1,659)              -                (1,659)
    Issuance of shares under
      stock purchase plans                              38            432                              -                   470
    Stock repurchase                                    (1)           -               (7)              -                    (8)
    Stock dividend                                     713          7,267         (7,980)              -                   -
    Other comprehensive income                         -              -              -                 870                 870
                                                    ------        -------         ------            ------             -------
Balance, December 31, 2000                          $4,305        $26,016         $5,648           $  (215)            $35,754
                                                   =======       ========        =======           =======            ========
</TABLE>




        The accompanying notes are an integral part of these statements.

                                        7
<PAGE>
                              Fentura Bancorp, Inc.
                      Consolidated Statements of Cash Flows
                        (In Thousands, Except Share Data)
                            Years Ended December 31,

<TABLE>
                                                                                  2000        1999          1998
                                                                                 -------      -------       -------
<S>                                                                             <C>          <C>           <C>
Cash Flows From Operating Activities
    Net income                                                                  $  4,216     $  4,000      $  3,820
    Adjustments to reconcile net income to net cash
       (used in) provided by operating activities
          Depreciation and amortization                                              984          879           907
          Deferred income taxes (benefit)                                           (100)         (35)           48
          Provision for possible credit losses                                       584          545           724
          Accretion on securities                                                    (43)         (28)          (47)
          Gain on sale of mortgage services rights                                  (467)         -             -
          Realized (gain) loss on sale of investment securities                      -            (24)         (112)
          Decrease (increase) in loans held for sale                                  (7)      10,327        (6,982)
          Decrease (increase) in accrued interest receivable                        (237)         (29)          249
          Decrease (increase) in other assets and other liabilities                  915       (3,135)         (834)
                                                                                 -------      -------       -------
                 Total adjustments                                                 1,629        8,500        (6,047)
                                                                                 -------      -------       -------
                 Net cash provided by (used in) operating activities               5,845       12,500        (2,227)

Cash Flows From Investing Activities
    Net decrease in time deposits with other banks                                   -            -              95
    Proceeds from sales of investment securities held for sale                       -         12,321        11,014
    Proceeds from maturities of investment securities                              6,539       56,628        38,582
    Purchase of investment securities                                             (3,995)     (60,763)      (71,140)
    Originations of loans, net of principal repayments                            (4,655)     (37,987)       (3,023)
    Proceeds from sales of loans                                                     100        8,460        20,895
    Proceeds of sale of mortgage servicing rights                                    887          -             -
    Acquisition of premises and equipment                                         (1,336)      (2,083)         (913)
                                                                                 -------      -------       -------
                 Net cash used in investing activities                            (2,460)     (23,424)       (4,490)

Cash Flows From Financing Activities
    Net increase (decrease) in demand deposits, NOW
       accounts, and savings accounts                                             (4,857)       5,380        12,234
    Net increase (decrease) in certificates of deposit                             6,462          566        (1,663)
    Net increase (decrease) in short-term borrowings                               3,315        1,324        (1,459)
    Payment of long-term debt                                                        (13)         (11)          (10)
    Cash dividends paid                                                           (1,659)      (1,586)       (1,464)
    Proceeds from issuance of common stock                                           462          707           790
                                                                                 -------      -------       -------
                 Net cash provided by financing activities                         3,710        6,380         8,428
                                                                                 -------      -------       -------
NET INCREASE (DECREASE) IN CASH AND CASH
    EQUIVALENTS                                                                    7,095       (4,544)        1,711

Cash and cash equivalents at beginning of year                                    13,614       18,158        16,447
                                                                                 -------      -------       -------
Cash and cash equivalents at end of year                                         $20,709      $13,614       $18,158
                                                                                ========     ========      ========
Supplemental disclosure of cash flow information: Cash paid during the year for:
        Interest                                                                $  9,652     $  8,279      $  8,725
        Income taxes                                                               1,627     $  2,054      $  1,727
</TABLE>

        The accompanying notes are an integral part of these statements.

                                        8
<PAGE>
                              Fentura Bancorp, Inc.

                   Notes to Consolidated Financial Statements

                        December 31, 2000, 1999 and 1998


Note A - Summary of Significant Accounting Policies

Basis of Presentation and Consolidation
The consolidated  financial  statements include the accounts of Fentura Bancorp,
Inc. (the  Corporation)  and its  wholly-owned  subsidiaries,  The State Bank in
Fenton,  Michigan and Davison State Bank in Davison,  Michigan (the Banks).  The
State  Bank  includes  the  accounts  of its  wholly-owned  subsidiary,  Fentura
Mortgage Corporation (the Mortgage Company).

Davison  State Bank was formed March 13, 2000 as a de novo bank  resulting  from
the spin-off of two existing  branches of The State Bank.  This  transaction was
accounted  for at  historical  cost and therefore did not have any effect on the
consolidated financial statements.

The Banks and Mortgage  Company operate nine community  banking offices offering
banking and trust services  principally  to  individuals,  small  businesses and
governmental  entities  primarily in Genesee,  Livingston and Oakland  Counties,
Michigan.

A summary of the significant  accounting  policies applied in the preparation of
the accompanying consolidated financial statements follows.

Cash Equivalents

For  purposes of the  consolidated  statements  of cash flows,  the  Corporation
considers  cash on hand,  cash and due from banks and  federal  funds sold to be
cash equivalents.

Investment Securities
Investment  securities are classified based on management's  intent with respect
to holding securities.  Securities purchased, where the Corporation has both the
positive  intent and  ability to hold to  maturity,  are  classified  as held to
maturity and are  recorded at cost,  adjusted  for  amortization  of premium and
accretion of discount.  All other  securities  purchased by the  Corporation are
classified as available for sale and carried at market value.  Unrealized  gains
and  losses on  available  for sale  securities  are  excluded  from  income and
recorded as an amount,  net of tax, as a separate component of accumulated other
comprehensive income until realized.

Loans Held for Sale
Loans held for sale are carried at the lower of cost or estimated  market value.
Market value is  determined  in the  aggregate on the basis of existing  forward
commitments or fair values attributable to similar loans.

Loans and Interest Income on Loans
Loans held for investment are carried at their  outstanding  principal  adjusted
for deferred  loan fees and costs.  Interest on loans is accrued and credited to
income based upon the principal amount  outstanding.  The accrual of interest on
loans is discontinued when, in the opinion of management, there is an indication
that the borrower may be unable to meet  payments as they become due.  Upon such
discontinuance,  all  unpaid  interest  accrued  during the  current  quarter is
reversed,  and unpaid  interest  accrued during prior quarters is charged to the
allowance for possible credit losses.  Interest  accruals are generally  resumed
when all delinquent  principal  and/or  interest has been brought current or the
loan becomes both well secured and in the process of collection.

                                        9
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note A - Summary of Significant Accounting Policies (Continued)

Loan Origination Fees and Costs

Loan origination fees and certain direct loan origination  costs are capitalized
and recognized  over the estimated life of the related loans as an adjustment of
its yield.

Allowance for Possible Credit Losses

The allowance for possible  credit losses is established as losses are estimated
to have  occurred  through a provision for loan losses  charged to income.  Loan
losses  are  charged  against  the  allowance  when   management   believes  the
uncollectibility of a loan balance is confirmed.  Subsequent recoveries, if any,
are credited to the allowance.

The  allowance  for possible  credit  losses is evaluated on a regular  basis by
management and is based upon management's  periodic review of the collectibility
of the loans in light of  historical  experience,  the  nature and volume of the
loan portfolio,  adverse  situations  that may affect the borrower's  ability to
repay,  estimated  value of any underlying  collateral  and prevailing  economic
conditions.  This evaluation is inherently  subjective as it requires  estimates
that  are  susceptible  to  significant  revision  as more  information  becomes
available.

The Corporation considers a loan impaired when it is probable, in the opinion of
management,  that  principal and interest may not be collected  according to the
contractual terms of the loan. Consistent with this definition,  the Corporation
considers  all  non-accrual  loans to be impaired.  The  allowance  for possible
credit losses includes specific allowances for impaired loans.

Bank Premises and Equipment

Bank premises and equipment  are stated at cost less  accumulated  depreciation.
Depreciation  is computed  using the  straight-line  method  over  useful  lives
ranging from 3 to 50 years.

Income Taxes

The Corporation  files a consolidated  Federal income tax return with the Banks.
The Corporation utilizes the asset and liability method of accounting for income
taxes.  Deferred tax assets and liabilities are recorded based on the difference
between the tax bases of assets and liabilities  and their carrying  amounts for
financial  reporting  purposes.  Tax  planning  strategies  are  utilized in the
computation  of deferred  federal  income  taxes.  In  addition,  the current or
deferred  tax  consequences  of a  transaction  are  measured  by  applying  the
provisions  of enacted tax laws to determine  the amount of taxes  receivable or
payable currently or in future years.

                                       10
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998


Note A - Summary of Significant Accounting Policies (Continued)

Net Income Per Share

Basic net income per share is computed by  dividing  net income by the  weighted
average common shares  outstanding for the period.  Diluted net income per share
reflects the potential dilution that could occur if outstanding options or other
contracts to issue common stock were  exercised and converted  into common stock
or  resulted in the  issuance of common  stock that then shared in the income of
the entity.  On April 26, 2000,  the  Corporation  declared a 20% stock dividend
payable May 26, 2000. Accordingly,  the per share amounts for 1999 and 1998 have
been retroactively adjusted to reflect the effect of the stock dividend.

Average  outstanding  shares utilized in the determination of earnings per share
are as follows:
<TABLE>
                                                       2000              1999             1998
                                                     ---------         ---------        ---------
                  <S>                                <C>               <C>              <C>
                  Basic                              1,712,971         1,698,581        1,679,290
                  Diluted                            1,717,457         1,705,290        1,679,290
</TABLE>

Use of Estimates

In the  preparation  of  consolidated  financial  statements in conformity  with
generally  accepted  accounting  principles,  management  is  required  to  make
estimates  and  assumptions   that  affect   reported   amounts  of  assets  and
liabilities,  the disclosure of contingent assets and liabilities at the date of
the financial  statements  and revenues and expenses for the reporting  periods.
Material  estimates that are  particularly  susceptible  to  significant  change
include market values of securities  available for sale and the determination of
the allowance for loan losses. Actual results could differ from those estimates.

Comprehensive Income

The provisions of Statement of Financial Accounting Standards No. 130 "Reporting
Comprehensive  Income" (SFAS 130),  were adopted in 1998.  Comprehensive  income
includes both net income and other  comprehensive  income.  Other  comprehensive
income  includes  the  change  in  unrealized  gains or  losses  on  investments
available-for-sale,   which  is  also  reported  as  a  separate   component  of
shareholders'  equity.  Unrealized  investment  gains or losses  only impact the
income statement when the investment is sold.

Issued But Not Yet Adopted Accounting Standards

The  Financial  Accounting  Standards  Board  (FASB)  has  issued  Statement  of
Financial  Accounting  Standard  (SFAS) No. 133, (as amended),  "Accounting  for
Derivative  Instruments and Hedging  Activities." The statement requires that an
entity  recognize  all  derivatives  as  either  assets  or  liabilities  in the
statement of financial position and measure those instruments at fair value. The
statement is effective in 2001 for the Corporation; however, management does not
expect this  pronouncement  to have a  significant  impact on the  Corporation's
financial position or results of operations.

                                       11
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note A - Summary of Significant Accounting Policies (Continued)

In September  2000, the FASB issued SFAS No. 140,  "Accounting for Transfers and
Servicing of Financial  Assets and  Extinguishments  of Liabilities"  ("SFAS No.
140") which  replaces  SFAS No. 125  "Accounting  for Transfers and Servicing of
Financial  Assets and  Extinguishments  of  Liabilities"  ("SFAS No.  125").  It
revises the standards for accounting for  securitizations and other transfers of
financial assets and collateral and requires certain disclosures, but it carries
over most of SFAS No. 125's provisions without reconsideration.  SFAS No. 140 is
effective for transfers and servicing of financial assets and extinguishments of
liabilities  occurring after March 31, 2001.  Implementation  of SFAS No. 140 is
not expected to have a material effect on the Corporation's  financial  position
or results of operations.

Note B - Restricted Cash Balances

Aggregate  reserves of $3,123,000 and $3,787,000  were maintained in the form of
vault cash and  deposits  with the Federal  Reserve  Bank to satisfy  regulatory
requirements at December 31, 2000 and 1999, respectively.

Note C - Investment Securities

The amortized cost and estimated market value of investments available for sale,
by major category, are as follows (in thousands):
<TABLE>
                                                                         December 31, 2000
                                                              -------------------------------------
                                                                       Gross         Gross       Estimated
                                                       Amortized    Unrealized    Unrealized      Market
                                                         Cost          Gains        Losses         Value
                                                        ---------     --------    --------       --------
<S>                                                     <C>           <C>          <C>           <C>
Obligations of U.S. government and agencies             $33,108          $40        $  59         $33,089
Equity securities                                         1,287          -            192           1,095
Mortgage backed securities                               19,352           53          168          19,237
                                                        -------         ----       ------         -------
                                                        $53,747          $93         $419         $53,421
                                                       ========        =====       ======        ========

                                                                         December 31, 1999
                                                              -------------------------------------
                                                                       Gross         Gross      Estimated
                                                       Amortized    Unrealized    Unrealized     Market
                                                         Cost          Gains        Losses        Value
                                                        ---------     --------       --------     --------
Obligations of U.S. government and agencies             $32,048       $    1      $   684         $31,365
Equity securities                                         1,287           -           208           1,079
Mortgage-backed securities                               22,273            2          755          21,520
                                                        -------         ----       ------         -------
                                                        $55,608       $    3       $1,647         $53,964
                                                       ========        =====      =======        ========
</TABLE>
                                       12
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998


Note C - Investment Securities (Continued)

The amortized cost and estimated market value of investment securities available
for sale at December  31, 2000,  by  contractual  maturity,  are shown below (in
thousands).  Expected maturities will differ from contractual maturities because
borrowers  may have the  right to call or  prepay  obligations  without  call or
prepayment penalties.
<TABLE>
                                                                                                Estimated
                                                                               Amortized         Market
                                                                                 Cost             Value
                                                                               ---------         ---------
<S>                                                                            <C>               <C>
Due in one year or less                                                        $  5,078          $  5,094
Due in one year through five years                                               24,022            24,012
Due after five years through ten years                                            4,008             3,983
                                                                                -------           -------
                                                                                 33,108            33,089
Equity securities                                                                 1,287             1,095
Mortgage-backed securities                                                       19,352            19,237
                                                                                -------           -------
                                                                                $53,747           $53,421
                                                                               ========          ========
</TABLE>
Investment  securities held to maturity at December 31, 2000 and 1999 consist of
obligations  of  states  and  political  subdivisions  and  are  summarized  (in
thousands) as follows:
<TABLE>
                                                                                    2000           1999
                                                                                  --------       --------
         <S>                                                                      <C>            <C>
         Amortized cost                                                            $13,283        $13,922
         Gross unrealized gains                                                        153             65
         Gross unrealized losses                                                       (17)          (213)
                                                                                   -------        -------
                  Estimated market value                                           $13,419        $13,774
                                                                                  ========       ========
</TABLE>
The amortized cost and estimated  market value of investment  securities held to
maturity at December  31, 2000,  by  contractual  maturity,  are shown below (in
thousands).  Expected maturities will differ from contractual maturities because
borrowers may have the right to call or prepay  obligations with or without call
or prepayment penalties.
<TABLE>
                                                                                               Estimated
                                                                              Amortized         Market
                                                                                Cost             Value
                                                                              --------         --------
         <S>                                                                  <C>              <C>
         Due in one year or less                                               $  4,139         $  4,156
         Due in one year through five years                                       4,503            4,544
         Due after five years through ten years                                   2,524            2,592
         Due after ten years                                                      2,117            2,127
                                                                                -------          -------
                                                                                $13,283          $13,419
                                                                               ========         ========
</TABLE>
                                       13
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note C - Investment Securities (Continued)

Securities  having a carrying value of $2,120,000 and $2,616,000 at December 31,
2000 and 1999,  respectively were pledged to secure public deposits,  repurchase
agreements, and for other purposes required by law.

Gross gains on sales of  securities  of $73,000 and $115,000 and gross losses of
$49,000 and $3,000 were recognized in 1999 and 1998, respectively. There were no
securities gains or losses in 2000.

Note D - Loans

Major categories of loans at December 31, are as follows (in thousands):
<TABLE>
                                                                                  2000              1999
                                                                                --------          --------
         <S>                                                                    <C>              <C>
         Commercial                                                             $101,925         $  92,896
         Real estate - construction                                               17,471            12,481
         Real estate - mortgage                                                   10,514            21,409
         Consumer                                                                 65,198            64,280
                                                                                --------          --------
                                                                                 195,108           191,066
         Less allowance for possible credit losses                                 2,932             2,961
                                                                                --------          --------
                                                                                $192,176          $188,105
                                                                                ========         =========
</TABLE>
Loan maturities and rate  sensitivity of the loan portfolio at December 31, 2000
are as follows (in thousands):
<TABLE>
                                                        Within        One-         After
                                                          One         Five         Five
                                                         Year         Years        Years          Total
                                                        -------      --------      -------        --------
         <S>                                           <C>          <C>           <C>             <C>
         Commercial, including construction             $44,756     $  63,861     $  5,895        $114,512
         Real estate                                      5,352           745        9,300          15,397
         Consumer                                         9,267        38,826       17,106          65,199
                                                        -------      --------      -------        --------
                                                        $59,375      $103,432      $32,301        $195,108
                                                       ========     =========     ========       =========

         Loans at fixed interest rates                  $22,671     $  81,389      $31,614        $135,674
         Loans at variable interest rates                36,704        22,043          687          59,434
                                                        -------      --------      -------        --------
                                                        $59,375      $103,432      $32,301        $195,108
                                                       ========     =========     ========       =========
</TABLE>

The  Corporation  originates  primarily  residential  and commercial real estate
loans, commercial, construction and installment loans. The Corporation estimates
that 80% of their loan  portfolio  is based in Genesee and  Livingston  counties
within  southeast  Michigan  with the  remainder  of the  portfolio  distributed
throughout  Michigan.  The ability of the  Corporation's  debtors to honor their
contracts is dependent upon the real estate and general  economic  conditions in
this area.

                                       14
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note D - Loans (Continued)

Certain  directors and executive  officers of the  Corporation,  including their
affiliates are loan customers of the Bank.  Such loans were made in the ordinary
course of business at the Bank's normal credit terms and interest rates,  and do
not  represent  more  than a normal  risk of  collection.  Total  loans to these
persons at December 31, 2000, 1999 and 1998 amounted to $1,134,000,  $1,449,000,
and  $909,000,  respectively.  During 2000,  $217,000 of new loans were made and
repayments totaled $532,000.

Transactions  in the  allowance  for possible  credit losses for the years ended
December 31, were as follows (in thousands):
<TABLE>
                                                                         2000          1999         1998
                                                                        ------        ------       ------
         <S>                                                           <C>            <C>          <C>
         Balance, beginning of year                                     $2,961        $2,783       $2,955
         Provision for possible credit losses charged to
             operations                                                    584           545          724
                                                                        ------        ------       ------
                                                                         3,545         3,328        3,679
         Loans charged off, net of recoveries of $193
             $84 and $172 for 2000, 1999 and 1998
             respectively                                                  613           367          896
                                                                        ------        ------       ------
         Balance, end of year                                           $2,932        $2,961       $2,783
                                                                       =======       =======      =======
         As a percent of total loans                                     1.50%         1.55%        1.72%
                                                                       =======       =======      =======
</TABLE>

Loan  impairment  is measured by estimating  the expected  future cash flows and
discounting  them at the  respective  effective  interest rate or by valuing the
underlying  collateral.  The recorded investment in these loans is as follows at
December 31, (in thousands):
<TABLE>
                                                                                      2000         1999
                                                                                     ------       ------
         <S>                                                                      <C>          <C>
         Principal amount not requiring allowance                                 $      -     $      -
         Principal amount requiring specific allowance                                 2,315        1,548
                                                                                      ------       ------
                                                                                       2,315        1,548
         Less:  valuation allowance                                                      715          702
                                                                                      ------       ------
                                                                                      $1,600      $   844
                                                                                     =======      =======
</TABLE>
Loans on which accrual of interest have been  discontinued  at December 31, 2000
and 1999 amounted to $731,000 and $742,000  respectively and are included in the
impaired loans above.

Interest income  recognized on impaired loans based on cash collections  totaled
approximately $146,000,  $299,000, and $204,000 for the years ended December 31,
2000, 1999 and 1998,  respectively.  The average recorded investment in impaired
loans was $1,932,000, $1,848,000, and $2,685,000 during the years ended December
31, 2000, 1999 and 1998.

                                       15
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note E - Bank Premises and Equipment

Bank  premises and  equipment is comprised of the  following at December 31, (in
thousands):
<TABLE>
                                                                                    2000          1999
                                                                                  -------        -------
         <S>                                                                    <C>            <C>
         Land and land improvements                                              $  1,273      $     859
         Building and building improvements                                         4,208          4,190
         Furniture and equipment                                                    7,963          7,277
         Construction in progress                                                     995            -
                                                                                  -------        -------
                                                                                   14,439         12,326
         Less accumulated depreciation                                              7,892          7,126
                                                                                  -------        -------
                                                                                 $  6,547       $  5,200
                                                                                 ========       ========
</TABLE>
Note F - Deposits

The  following  is a summary of  interest-bearing  deposits at December  31, (in
thousands):
<TABLE>
                                                                                   2000          1999
                                                                                 --------       --------
         <S>                                                                    <C>            <C>
         Interest-bearing:
             Savings                                                            $  66,186      $  72,745
             Money market demand                                                   37,165         38,702
             Time, $100,000 and over                                               34,259         28,070
             Time, $100,000 and under                                              76,284         76,010
                                                                                 --------       --------
                                                                                 $213,894       $215,527
                                                                                =========      =========
</TABLE>
At December 31, 2000,  scheduled maturities of time deposits were as follows (in
thousands):
<TABLE>
                                                                                  Amount
                                                                                 --------
             <S>                                                                <C>
             Less than 1 year                                                   $  75,269
             1 - 5 years                                                           35,003
             Over 5 years                                                             271
                                                                                 --------
                                                                                 $110,543
                                                                                =========
</TABLE>

Note G - Borrowings

Short-Term Borrowings

Short-term  borrowings  consist of term federal funds purchased and treasury tax
and loan  deposits  and  generally  are  repaid  within one to 120 days from the
transaction date.

Long-Term Debt

The Bank has the  authority  and approval from the Federal Home Loan Bank (FHLB)
to  borrow  up to $15  million  collateralized  by 1-4  family  mortgage  loans,
government  and agency  securities,  and  mortgage-backed  securities.  Advances
outstanding at December 31, 2000 and 1999 mature in 2016, can be prepaid without
penalty and bear interest at 7.34%.

                                       16
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998




Note H - Income Taxes

The  provision  for income taxes  reflected in the  consolidated  statements  of
income  for  the  years  ended  December  31,  consists  of  the  following  (in
thousands):
<TABLE>
                                                                             2000       1999       1998
                                                                            ------     ------     ------
         <S>                                                               <C>         <C>        <C>
         Current expense                                                    $1,829     $1,817     $1,680
         Deferred (benefit) expense                                           (100)       (35)        48
                                                                            ------     ------     ------
                                                                            $1,729     $1,782     $1,728
                                                                           =======    =======    =======
</TABLE>
Income tax expense was less than the amount  computed by applying the  statutory
federal  income tax rate to income  before  income  taxes.  The  reasons for the
difference are as follows:
<TABLE>
                                                                               % of Pretax Income
                                                                              ----------------------
                                                                          2000        1999        1998
                                                                         ------      ------      ------
         <S>                                                            <C>         <C>         <C>
         Income tax at statutory rate                                    34.0%       34.0%       34.0%
         Tax exempt interest                                             (3.4)       (3.0)       (2.7)
         Other                                                           (1.5)        (.2)        (.2)
                                                                        ------      ------      ------
         Actual income tax expense                                       29.1%       30.8%       31.1%
                                                                       =======     =======      ======
</TABLE>
The net deferred tax asset and current refund  (liability)  are reflected in the
balance sheet in other assets and accrued taxes, interest and other liabilities,
respectively. The details of the net deferred tax asset and current liability at
December 31, are as follows (in thousands):
<TABLE>
                                                                                  2000            1999
                                                                                 ------          ------
<S>                                                                             <C>           <C>
Deferred tax assets
    Allowance for possible credit losses                                        $   805       $   813
    Unrealized losses on investment securities available for sale                   111           559
    Compensation                                                                    137           102
    Depreciation and other                                                           60            17
                                                                                 ------        ------
               Total deferred tax assets                                          1,113         1,491

Deferred tax liabilities
    Mortgage servicing rights                                                      (132)         (115)
    Depreciation and other                                                          (93)         (140)
                                                                                 ------        ------
              Total deferred tax liabilities                                       (225)         (255)
                                                                                 ------        ------
               Net deferred tax asset                                               888         1,236
               Current refund                                                        19           122
                                                                                 ------        ------
                                                                                $   907        $1,358
                                                                                =======        ======
</TABLE>
                                       17
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note I - Benefit Plans

The Corporation  has a  noncontributory  discretionary  employee stock ownership
plan (Plan) covering substantially all of its employees.  It is a requirement of
the  plan  to  invest  principally  in  the  Corporation's   common  stock.  The
contribution  to the Plan in 2000,  1999 and  1998 was  $120,000,  $120,000  and
$122,000, respectively.

The Corporation  has also  established a 401(k) Plan where 50% of the employees'
contribution can be matched with a discretionary contribution by the Corporation
up to a maximum of 6% of gross wages.  The  contribution  to the 401(k) Plan for
2000, 1999 and 1998 was $79,000, $80,000 and $76,000, respectively.

Note J - Stock Purchase and Option Plans

Director and Employee Plans

The  Directors'  Stock  Purchase Plan permits  directors of the  Corporation  to
purchase  shares of common stock made  available for purchase  under the plan at
the fair market value on the  fifteenth day prior to the annual  issuance  date.
The total number of shares  issuable  under this plan is limited to 9,600 shares
in any calendar year.

The Retainer  Stock Plan allows  directors to elect to receive  shares of common
stock in full or partial  payment of the  director's  retainer fees and fees for
attending  meetings.  The number of shares is  determined by dividing the dollar
amount  of fees to be paid in  shares  by the  market  value of the stock on the
first business day prior to the payment date.

The Executive  Stock Bonus Plan permits the  administrator  of the plan to grant
shares of the Corporation's common stock to eligible employees. Any executive or
managerial  level  employee is eligible to receive  grants  under the plan.  The
Board of Directors administers the plan.

Dividend Investment Plan

The Automatic Dividend  Reinvestment Plan ("DRIP") permits enrolled shareholders
to  automatically  use  dividends  paid on common  stock to purchase  additional
shares  of the  Corporation's  common  stock  at the  fair  market  value on the
investment  date. Any  shareholder  who is the beneficial or record owner of not
more than 9.9% of the issued and outstanding shares of the Corporation's  common
stock is eligible to participate in the plan.

Pursuant to a separate  agreement with a family who collectively holds more than
9.9% of the  Corporation's  stock,  on or  prior  to  January  31 of  each  year
beginning  January 31,  1997,  the  Corporation  is to advise the  family,  in a
written notice,  of the number of shares sold under the DRIP. Each family member
will have the option,  until  February 28 of the same year, to purchase from the
Corporation  one-third of the total number of shares that would be sufficient to
prevent the  dilution to all family  members as a group that result  solely as a
result of the DRIP shares.  The purchase  price under this agreement is the fair
market value on December 31 of the year immediately  preceding the year in which
the written notice is given.

                                       18
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note J - Stock Purchase and Option Plans (Continued)

Stock Option Plans

The  Nonemployee  Director  Stock  Option  Plan  grants  options to  nonemployee
directors to purchase the  Corporation's  common stock on April 1 each year. The
purchase  price of the shares is the fair market value at the date of the grant,
and there is a three  year  vesting  period  before  options  may be  exercised.
Options to acquire no more than 6,720  shares of stock may be granted  under the
Plan in any calendar  year and options to acquire not more than 67,200 shares in
the aggregate may be outstanding at any one time.

The Employee Stock Option Plan grants options to eligible  employees to purchase
the  Corporation's  common stock at or above, the fair market value of the stock
at the date of the  grant.  Awards  granted  under  this plan are  limited to an
aggregate  of 72,000  shares.  The  administrator  of the plan is a committee of
directors. The administrator has the power to determine the number of options to
be granted,  the  exercise  price of the options and other terms of the options,
subject to consistency with the terms of the plan.

The following summarizes shares issued under the various plans:
<TABLE>
                                                                           2000         1999         1998
                                                                          ------       ------       ------
         <S>                                                              <C>          <C>          <C>
         Automatic dividend reinvestment plan                             12,607        8,846       10,925
         Director stock purchase and retainer stock plan                   1,018        5,800       11,945
         Other issuance of shares                                          1,912        1,685        5,630
                                                                          ------       ------       ------
                                                                          15,537       16,331       28,500
                                                                         =======      =======      =======
</TABLE>
The following table summarizes stock option activity:
<TABLE>
                                                                    No. of                   Weighted
                                                                   Options                 Average Price
                                                                    ------                  ------------
      <S>                                                           <C>                        <C>
      Options outstanding at January 1, 1998                         7,728                      17.34
      Options granted in 1998                                        4,968                      23.22
                                                                    ------
      Options outstanding at December 31, 1998                      12,696                      19.64

      Options granted in 1999                                        5,208                      37.25
                                                                    ------
      Options outstanding at December 31, 1999                      17,904                      24.77

      Options granted in 2000                                        1,771                      39.58
                                                                    ------
      Options outstanding at December 31, 2000                      19,675                     $26.10
                                                                    ======
</TABLE>
                                       19
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note J - Stock Purchase and Option Plans (Continued)

Information  pertaining  to  options  outstanding  at  December  31,  2000 is as
follows:
<TABLE>
                                                           Weighted
                                                            Average          Weighted
          Range of                        Number           Remaining          Average           Number
       Exercise Price                   Outstanding          Life              Price          Exercisable
                                        -----------        ---------        --------           ----------
<S>                                      <C>                <C>              <C>               <C>
$15.00 - $20.00                             7,728            5.75            $17.35             3,864
$20.00 - $30.00                             4,968            7.23             23.21               -
$30.00 - $40.00                             6,979            9.00             37.59               -
$40.00 - $50.00                               240            8.52             45.00               -
                                           ------                                               -----
Outstanding at end of year                 19,675            7.27            $26.10             3,864
                                          =======                                             =======
</TABLE>
The  stock  option  plans  are  accounted  for  in  accordance  with  Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" (APB
25) as permitted under Financial  Accounting  Standards No. 123, "Accounting for
Stock Based Compensation" (SFAS 123). In accordance with APB 25, no compensation
expense  is  required  nor has been  recognized  for the  options  issued  under
existing plans.  Had the Corporation  chosen not to elect APB 25, SFAS 123 would
apply and compensation expense would have been recognized, and the Corporation's
earnings would have been as follows (in thousands, except per share data):
<TABLE>
                                                      2000              1999           1998
                                                     -------          -------         -------
         <S>                                       <C>              <C>             <C>
         Net income
             As reported                           $   4,216        $   4,000       $   3,820
             Proforma                              $   4,171        $   3,977       $   3,796

         Basic net income per share
             As reported                           $    2.46        $    2.36       $    2.28
             Proforma                              $    2.44        $    2.34       $    2.26

         Diluted net income per share
             As reported                           $    2.45        $    2.35       $    2.28
             Proforma                              $    2.43        $    2.33       $    2.26
</TABLE>
Proforma  net income  includes  compensation  cost for the  Corporation's  stock
option plan based on the fair values of the grants as of the dates of the awards
consistent with the method prescribed by SFAS 123. The fair value of each option
grant is estimated  using the  Black-Scholes  option-pricing  model  assuming an
expected life of 10 years,  a dividend  yield of 3%, a risk free return of 6.88%
and expected volatility of 52%.

                                       20
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note K - Regulatory Matters

The Corporation (on a consolidated  basis) and its Bank subsidiaries are subject
to various regulatory capital  requirements  administered by the federal banking
agencies.  Failure to meet minimum  capital  requirements  can initiate  certain
mandatory - and possibly additional  discretionary - actions by regulators that,
if  undertaken,  could have a direct  material  effect on the  Bank's  financial
statements.  Under capital adequacy guidelines and the regulatory  framework for
prompt  corrective  action,  the  Corporation  and the Banks must meet  specific
capital guidelines that involve  quantitative  measures of assets,  liabilities,
and certain  off-balance-sheet  items as calculated under regulatory  accounting
practices.   The  capital  amounts  and  classifications  are  also  subject  to
qualitative judgments by the regulators about components,  risk weightings,  and
other factors.  Prompt  corrective  action provisions are not applicable to bank
holding companies.

Quantitative  measures  established  by  regulation to ensure  capital  adequacy
require the  Corporation  and the Banks to maintain  minimum  amounts and ratios
(set forth in the table  below) of total and Tier 1 capital  (as  defined in the
regulations)  to  risk-weighted  assets (as defined),  and of Tier 1 capital (as
defined) to average assets (as defined). Management believes, as of December 31,
2000, that the Corporation and the Banks meet all capital adequacy  requirements
to which they are  subject.  At December 31, 1999 The State Bank met all capital
requirements  to which it was subject.  As of December 31, 2000, the most recent
notification  from  Federal  Deposit  Insurance   Corporation   categorized  the
Corporation and the Banks as well capitalized under the regulatory framework for
prompt corrective  action. To be categorized as well capitalized the Corporation
and the Banks must maintain  minimum total  risk-based,  Tier 1 risk-based,  and
Tier 1 leverage  ratios as set forth in the table.  There are no  conditions  or
events since that notification that management  believes have changed the Banks'
category.
<TABLE>
                                                                                            To Be Well
                                                                    For Capital         Capitalized Under
                                                                     Adequacy           Prompt Corrective
                                             Actual                  Purposes           Action Provisions
                                        -----------------        ---------------        ----------------
                                        Amount      Ratio        Amount    Ratio        Amount     Ratio
                                        -----------------        ---------------        ----------------
<S>                                     <C>        <C>           <C>        <C>         <C>         <C>
As of December 31, 2000:
Total Capital
    (to Risk Weighted Assets)
    Consolidated                        $38,974    16.2%         $19,232     8%         $24,040       NA
    The State Bank                       32,822    14.9%          17,667     8%          22,084      10%
    Davison State Bank                    3,232    16.8%           1,539     8%           1,924      10%
Tier 1 Capital
    (to Risk Weighted Assets)
    Consolidated                        $35,969    15.0%           9,616     4%         $14,424       NA
    The State Bank                       30,061    13.6%           8,333     4%          13,250       6%
    Davison State Bank                    2,991    15.5%             770     4%           1,154       6%
Tier 1 Capital
    (to Average Assets)
    Consolidated                        $35,969    12.1%         $11,839     4%         $14,799       NA
    The State Bank                       30,061    11.0%          10,938     4%          13,673       5%
    Davison State Bank                    2,991    13.5%             886     4%           1,108       5%
</TABLE>

                                       21
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note K - Regulatory Matters (Continued)
<TABLE>
                                                                                           To Be Well
                                                                    For Capital         Capitalized Under
                                                                     Adequacy           Prompt Corrective
                                             Actual                  Purposes           Action Provisions
                                       -----------------        ---------------        ----------------
                                       Amount      Ratio        Amount    Ratio        Amount     Ratio
                                       -----------------        ---------------        ----------------
<S>                                    <C>         <C>          <C>       <C>          <C>        <C>
As of December 31, 1999:              (For The State Bank only)
Total Capital
    (to Risk Weighted Assets)           $33,349    14.3%         $18,706   8.0%         $23,382  10.0%
Tier 1 Capital
    (to Risk Weighted Assets)           $30,426    13.0%         $ 9,353   4.0%         $14,029   6.0%
Tier 1 Capital
    (to Average Assets)                 $30,426    11.1%         $10,916   4.0%         $13,645   5.0%
</TABLE>

Note L - Financial Instruments

The estimated fair values of the Corporation's financial instruments at December
31, are as follows (in thousands):
<TABLE>
                                                                2000                        1999
                                                        ---------------------        ---------------------
                                                                    Estimated                    Estimated
                                                        Carrying       Fair          Carrying       Fair
                                                         Amount        Value          Amount        Value
                                                        --------     --------        --------     --------
<S>                                                     <C>          <C>              <C>          <C>
Assets:
    Cash and cash equivalents                           $  20,709    $  20,709        $13,614      $13,614
    Loans held for sale                                       187          188            180          181
    Investment securities                                  66,704       66,840         67,886       67,738
    Loans                                                 192,176      193,017        188,105      190,194

Liabilities:
    Deposits                                              248,656      249,267        247,051      247,545
    Short-term borrowings                                   4,680        4,680          1,365        1,365
    Long-term debt                                          1,151        1,202          1,164        1,246
</TABLE>

The following methods and assumptions were used by the Corporation in estimating
its fair value disclosures for financial instruments:

Cash and cash  equivalents:  The carrying  amounts reported in the balance sheet
for cash and short-term instruments approximate their fair values.

Investment   securities   and  time   deposits   with  other  banks   (including
mortgage-backed securities):  Fair values for investment securities are based on
quoted  market  prices,  where  available.  If  quoted  market  prices  are  not
available,  fair  values  are  based  on  quoted  market  prices  of  comparable
instruments.

                                       22
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note L - Financial Instruments (Continued)

Loans held for sale: The market value of these loans  represents  estimated fair
value.  The market value is determined in the aggregate on the basis of existing
forward commitments or fair values attributable to similar loans.

Loans:  For variable rate loans that reprice  frequently and with no significant
change in credit risk, fair values are based on carrying values. The fair values
for other  loans are  estimated  using  discounted  cash  flow  analysis,  using
interest rates currently being offered for loans with similar terms to borrowers
of similar credit quality.  The carrying amount of accrued  interest  receivable
approximates its fair value.

Off-balance-sheet  instruments: The Corporation's  off-balance-sheet instruments
approximate their fair values.

Deposit  liabilities:  The fair values  disclosed  for demand  deposits  are, by
definition,  equal to the amount  payable on demand at the reporting  date.  The
carrying  amounts  for  variable  rate,  fixed term money  market  accounts  and
certificates  of deposit  approximate  their fair values at the reporting  date.
Fair  values  for fixed  rate  certificates  of deposit  are  estimated  using a
discounted  cash flow  calculation  that applies  interest rates currently being
offered on similar certificates. The carrying amount of accrued interest payable
approximates its fair value.

Short-term  borrowings:   The  carrying  amounts  of  federal  funds  purchased,
borrowings  under  repurchase   agreements,   and  other  short-term  borrowings
approximate their fair values.

Long-Term debt:  Rates currently  available for FHLB debt with similar terms and
remaining maturities are used to estimate the fair value of the existing debt.

Limitations: Fair value estimates are made at a specific point in time, based on
relevant  market  information and  information  about the financial  instrument.
These  estimates  do not reflect any premium or discount  that could result from
offering for sale at one time the Corporation's  entire holdings of a particular
financial instrument.  Because no market exists for a significant portion of the
Corporation's   financial  instruments,   fair  value  estimates  are  based  on
management's  judgments  regarding  future  expected  loss  experience,  current
economic conditions, risk characteristics and other factors. These estimates are
subjective  in nature and  involve  uncertainties  and  matters  of  significant
judgment  and  therefore  cannot  be  determined  with  precision.   Changes  in
assumptions could significantly affect the estimates.

Off-Balance-Sheet Risk

The Corporation is party to financial instruments with off-balance-sheet risk in
the normal course of business to meet the  financing  needs of its customers and
to reduce its own exposure to fluctuations  in interest  rates.  These financial
instruments include commitments to extend credit and financial guarantees. These
instruments  involve,  to varying degrees,  elements of credit and interest rate
risk that are not recognized in the statement of financial condition.

                                       23
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note L - Financial Instruments (Continued)

Exposure to credit loss in the event of nonperformance by the other party to the
financial  instrument for commitments to extend credit and financial  guarantees
written is represented by the contractual  notational amount of those items. The
Corporation  generally requires collateral to support such financial instruments
in  excess  of the  contractual  notational  amount  of those  instruments  and,
therefore, is in a fully collateralized position.

The   Corporation  had  outstanding   unfunded  loan   origination   commitments
aggregating   $44,184,000  and  $48,573,000  at  December  31,  2000  and  1999,
respectively.  Commitments to extend credit are agreements to lend to a customer
as long as there are no violations of any condition established in the contract.
Commitments  generally have fixed expiration dates or other termination  clauses
and may  require a payment of a fee.  Fees from  issuing  these  commitments  to
extend credit are recognized over the period to maturity.  Since portions of the
commitments  are  expected  to  expire  without  being  drawn  upon,  the  total
commitments  do  not  necessarily   represent  future  cash  requirements.   The
Corporation evaluates each customer's  creditworthiness on a case by case basis.
The  amount  of  collateral  obtained  upon  extension  of  credit  is  based on
management's credit evaluation of the customer.

Note M - Parent Only Condensed Financial Information

The  condensed  financial   information  that  follows  presents  the  financial
condition of Fentura Bancorp, Inc. (parent company only), along with the results
of its operations and its cash flows.
<TABLE>
                              Fentura Bancorp, Inc.
                            Condensed Balance Sheets
                           December 31, (in thousands)

                                                                                   2000             1999
                                                                                 -------           -------
<S>                                                                             <C>               <C>
Assets
    Cash and cash equivalents                                                   $  2,452          $  1,645
    Investment securities                                                            273               256
    Land held for investment                                                         -                 414
    Other assets                                                                      65                71
    Investment in subsidiaries                                                    32,964            29,479
                                                                                 -------           -------
                                                                                 $35,754           $31,865
                                                                                ========          ========
Stockholders' Equity
    Common Stock                                                                $  4,305             3,555
    Additional paid in capital                                                    26,016            18,317
    Retained earnings                                                              5,648            11,078
    Accumulated other comprehensive loss                                            (215)           (1,085)
                                                                                 -------           -------
                                                                                 $35,754           $31,865
                                                                                ========          ========
</TABLE>
                                      24
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note M - Parent Only Condensed Financial Information (Continued)

<TABLE>
                              Fentura Bancorp, Inc.

                         Condensed Statements of Income
                     Years Ended December 31, (in thousands)

                                                                           2000         1999         1998
                                                                          ------       ------       ------
<S>                                                                      <C>          <C>          <C>
Dividends from subsidiaries                                               $1,659       $1,586       $1,464
Operating expenses                                                           (69)         (79)         (22)
Equity in undistributed income of subsidiaries                             2,626        2,493        2,378
                                                                          ------       ------       ------
                  Net income                                              $4,216       $4,000       $3,820
                                                                         =======      =======      =======

                       Condensed Statements of Cash Flows
                     Years Ended December 31, (in thousands)


                                                                           2000         1999         1998
                                                                          ------       ------       ------
Cash flows from operating activities
    Net income                                                            $4,216       $4,000       $3,820
    Adjustment to reconcile net income to net
       cash provided by operating activities
          Equity in undistributed income of subsidiary                    (2,626)      (2,493)      (2,378)
                                                                          ------       ------       ------
                  Net cash provided by operating activities                1,590        1,507        1,442

Cash flows provided by (used in) investing activities
    Sale of equity investment                                                -             10
    Purchase of investments                                                  -            -           (475)
    (Increase) decrease in land held for investment                          414          -           (414)
                                                                          ------       ------       ------
                  Net cash provided by (used in)
                     investing activities                                    414           10         (889)

Cash flows used in financing activities
    Dividends paid                                                        (1,659)      (1,586)      (1,464)
    Proceeds from stock issuance                                             462          707          790
                                                                          ------       ------       ------
                  Net cash used in financing activities                   (1,197)        (879)        (674)
                                                                          ------       ------       ------
Increase (decrease) in cash and cash equivalents                             807          638         (121)

Cash and cash equivalents at beginning of year                             1,645        1,007        1,128
                                                                          ------       ------       ------
Cash and cash equivalents at end of year                                  $2,452       $1,645       $1,007
                                                                         =======      =======      =======
</TABLE>

                                       25
<PAGE>
                              Fentura Bancorp, Inc.

             Notes to Consolidated Financial Statements - Continued

                        December 31, 2000, 1999 and 1998



Note N -  Summary of Quarterly Financial Data - Unaudited (In Thousands,
          except per share data)

The unaudited quarterly results of operations for 2000 and 1999 are as follows:
<TABLE>
                                                                         2000
                                                     -------------------------------------------
                                               First            Second             Third           Fourth
                                              Quarter           Quarter           Quarter          Quarter
                                             -------            -------           -------          -------
<S>                                          <C>                <C>             <C>                <C>
Interest income                                $5,539            $5,919           $5,967            $5,902
Interest expense                                2,296             2,512            2,559             2,523
Provision for loan losses                         169               201              153                61
Non-interest expense                            2,882             3,076            2,892             2,586
    Income before income taxes                  1,143             1,183            1,457             2,162
Provision for income taxes                        270               353              437               669
                                               ------            ------           ------            ------
    Net income                                $   873           $   830           $1,020            $1,493
                                              =======           =======          =======           =======
Net income per share
    Basic                                         .51              .48               .59              .88
    Diluted                                       .51              .48               .59              .87

                                                                         1999
                                                       -------------------------------------------
                                               First            Second             Third           Fourth
                                               Quarter          Quarter           Quarter          Quarter
                                               -------           -------          -------          -------
Interest income                                $5,083            $5,373           $5,276            $5,482
Interest expense                                1,955             1,936            1,967             2,155
Provision for loan losses                         195               130              165                55
Non-interest expense                            1,026             1,000            1,083             1,153
    Income before income taxes                  1,284             1,417            1,463             1,618
Provision for income taxes                        398               437              447               500
                                               ------            ------           ------            ------
    Net income                                $   886           $   980           $1,016            $1,118
                                              =======           =======          =======          ========
Net income per share (a)
    Basic                                         .52              .58               .60              .66
    Diluted                                       .52              .58               .60              .65

</TABLE>
(a) Per share  amounts  have been  restated  to reflect  the 20% stock  dividend
declared April 26, 2000.

                                       26
<PAGE>
Management's Discussion and Analysis of Financial Condition and
Results of Operations

This section  provides a narrative  discussion and analysis of the  consolidated
financial  condition  and results of operations  of Fentura  Bancorp,  Inc. (the
Corporation),  together with its subsidiaries,  The State Bank and Davison State
Bank (the Banks),  for the years ended  December 31, 2000,  1999,  and 1998. The
supplemental  financial data included  throughout this discussion should be read
in  conjunction  with the  primary  financial  statements  presented  on pages 4
through 26 of this report. It provides a more detailed and comprehensive  review
of  operating  results and  financial  position  than could be  obtained  from a
reading of the financial statements alone.
<TABLE>
TABLE 1                                                         Selected Financial Data
$ in thousands except per share data
  and ratios                                                     2000       1999       1998       1997       1996
------------------------------------------------------------------------------------------------------------------
<S>                                                           <C>        <C>        <C>        <C>        <C>
Summary of Consolidated Statements of Earnings:
Interest Income                                               $23,327    $21,214    $21,440    $21,601    $20,502
Interest Expense                                                9,890      8,013      8,648      9,167      8,571
                                                           -------------------------------------------------------
Net Interest Income                                            13,437     13,201     12,792     12,434     11,931
Provision for Possible Credit Losses                              584        545        724        624        648
                                                           -------------------------------------------------------
Net Interest Income after Provision                            12,853     12,656     12,068     11,810     11,283
Total Other Operating Income                                    4,528      4,262      4,028      3,472      3,472
Total Other Operating Expense                                  11,436     11,136     10,548     10,242     10,190
                                                           -------------------------------------------------------
Income Before Income Taxes                                      5,945      5,782      5,548      5,040      4,565
Provision for Income Taxes                                      1,729      1,782      1,728      1,580      1,332
                                                           -------------------------------------------------------
Net Income                                                     $4,216     $4,000     $3,820     $3,460     $3,233
                                                           =======================================================
Net Income Per Share - Basic                                    $2.46      $2.36      $2.28      $2.11      $2.02
Net Income Per Share - Diluted                                  $2.45      $2.35      $2.28      $2.11      $2.02

Summary of Consolidated Statements of Financial Condition:
Assets                                                       $292,890   $283,621   $275,047   $262,798   $254,381
Securities                                                     66,704     67,886     77,956     56,050     50,885
Loans                                                         195,295    191,246    172,413    184,198    176,236
Deposits                                                      248,656    247,051    241,105    230,534    224,049
Stockholders' Equity                                           35,754     31,865     30,022     26,742     24,109

Other Financial and Statistical Data:
Tier 1 Capital to Risk Weighted Assets                         14.96%     13.01%     13.30%     12.22%     11.76%
Total Capital to Risk Weighted Assets                          16.21%     14.26%     14.55%     13.47%     13.01%
Tier 1 Capital to Average Assets                               12.15%     11.15%     10.60%      9.99%      9.86%
Total Cash Dividends                                           $1,659     $1,586     $1,464     $1,784     $1,291
Book Value Per Share                                           $20.76     $18.68     $17.77     $16.09     $14.83
Cash Dividends Paid Per Share                                   $0.97      $0.93      $0.88      $1.09      $0.81
Period End Market Price Per Share                              $25.13     $36.88     $41.67     $21.88     $17.98
Dividend Pay-out Ratio                                         39.35%     39.65%     38.32%     51.56%     39.93%
Return on Average Stockholders' Equity                         12.56%     12.66%     14.02%     13.76%     14.04%
Return on Average Assets                                        1.42%      1.46%      1.45%      1.35%      1.33%
Net Interest Margin                                             5.07%      5.32%      5.28%      5.26%      5.36%
Total Equity to Assets at Period End                           12.21%     11.24%     10.92%     10.18%      9.48%
</TABLE>
                                       27
<PAGE>
RESULTS OF OPERATIONS

The Corporation achieved record earnings again during 2000. Earnings for 2000 of
$4,216,000 exceeded 1999 results of $4,000,000 by 5.4%. Net income has continued
to  steadily  increase  as a  result  of  continued  strength  of  core  banking
activities.  Contributing  to the 2000 record results was the improvement of net
interest  income and other  operating  income.  Because of the  strength of core
banking  activities  and new  opportunities  in the  Corporation's  current  and
surrounding   markets,   management  believes  performance  will  remain  strong
throughout 2001.

Standard  performance  indicators used in the banking industry help evaluate the
Corporation's  performance.  Two of these  performance  indicators are return on
average assets and return on average equity.  For 2000, 1999, 1998 respectively,
the Corporation  posted a return on average assets of 1.42%,  1.46%,  and 1.45%.
Total assets  increased $9 million in 2000, $9 million in 1999,  and $12 million
in 1998. Return on average equity was 12.56% in 2000, 12.66% in 1999, and 14.02%
in 1998.  The  increases  in equity will allow the  Corporation  to continue its
growth  strategy.  Net income per share-basic was $2.46 in 2000,  $2.36 in 1999,
and $2.28 in 1998.

NET INTEREST INCOME

Net interest income,  the principal source of income,  is the amount of interest
income generated by earning assets (principally investment securities and loans)
less interest expense paid on interest bearing liabilities (largely deposits and
other borrowings).

A critical  task of management  is to price assets and  liabilities  so that the
spread  between  the  interest  earned  on  assets  and  the  interest  paid  on
liabilities  is maximized  without  unacceptable  risk.  While interest rates on
earning assets and interest bearing liabilities are subject to market forces, in
general the  Corporation  can exert more control over deposit costs than earning
assets rates.  Loan products  carry either fixed rates of interest or rates tied
to market indices determined  independently.  The Corporation sets its own rates
on deposits,  providing  management  with some  flexibility in  determining  the
timing and proportion of rate changes for the cost of its deposits.

Table 2 summarizes the changes in net interest income  resulting from changes in
volume and rates for the years ended  December  31, 2000 and 1999.  Net interest
income  (displayed  without  consideration  of full  tax  equivalency),  average
balance sheet amounts, and the corresponding yields for the last three years are
shown in Table 3. Net interest  income  increased  $236,000 in 2000,  or 1.8% to
$13,437,000  as compared with an increase of $409,000 or 3.2% to  $13,201,000 in
1999. The primary factor  contributing to the increase in net interest income in
2000 was the increase in interest income from asset growth.  Within assets, both
loans and federal funds sold increased. In 1999, the primary factor contributing
to the increase in net interest  income was the  reduction of interest  expense.
Interest expense was reduced even though interest-bearing liabilities increased.
This reduction in expense occurred  because of continuing  progress in promoting
lower cost core  deposits  while  reducing  reliance  on higher  rate  retail or
negotiated  certificates  of deposit as well as the re-pricing  that occurred on
maturing certificates of deposit in response to earlier drops in prime rates.

As indicated in Table 3, for the year ended December 31, 2000, the Corporation's
net interest  margin was 4.91% compared with 5.18% and 5.17% for the same period
in 1999 and 1998 respectively,  and continues to remain substantially above peer
performance.  The decrease in margin in 2000 is  attributable  to an increase in
the  Corporation's  cost of funds.  Cost of funding  increased  in  response  to
increases in treasury rates and local  competitor's  rates.  The increase in net
interest  margin in 1999 and 1998 is attributable to the change in balance sheet
mix achieved  through growth and the continued  emphasis on lowering the cost of
funds outlined in the paragraph above. Management anticipates steady loan growth
and accordingly, continued growth in net interest income in 2001.

Average  earning assets  increased 7.4% in 2000, 2.9% in 1999, and 3.0% in 1998.
Loans, the highest yielding  component of earning assets,  represented  72.3% of
earning assets in 2000, compared to 69.9% in

                                       28
<PAGE>
1999 and 69.4% in 1998. Average interest bearing  liabilities  increased 7.0% in
2000, 2.5% in 1999, and 1.4% in 1998.  Non-interest bearing deposits amounted to
13.1% of average earning assets in 2000 compared with 11.7% in 1999 and 11.0% in
1998.
<TABLE>
TABLE 2                 Changes in Net Interest Income
                        Due to Changes in Average Volume
                               and Interest Rates
                            Years Ended December 31,
                                                  INCREASE (DECREASE)         INCREASE (DECREASE)
                                                          2000                       1999
                                                         DUE TO:                    DUE TO:
                                              --------------------------------------------------------
                                                          YIELD/                     YIELD/
(000's omitted)                                   VOL      RATE    TOTAL    VOL      RATE      TOTAL
------------------------------------------------------------------------------------------------------
<S>                                              <C>        <C>    <C>      <C>       <C>        <C>
INTEREST BEARING DEPOSITS IN BANKS                  $0        $0      $0     $ (1)       $0      $ (1)
TAXABLE SECURITIES                                   4       147     151      309         7       316
TAX-EXEMPT SECURITIES                               91        (7)     84       81       (13)       68
FEDERAL FUNDS SOLD                                (137)      188      51       48       (53)       (5)

TOTAL LOANS                                      1,859       (33)  1,826      631      (754)     (123)
LOANS HELD FOR SALE                                  0         1       1     (482)        1      (481)
                                              --------------------------------------------------------

                         TOTAL EARNING ASSETS    1,817       296   2,113      586      (812)     (226)


INTEREST BEARING DEMAND DEPOSITS                   (31)       51      20      127      (177)      (50)
SAVINGS DEPOSITS                                    22       346     368      114        39       153
TIME C.D.s $100,000 AND OVER                       420       263     683      (46)      (96)     (142)
OTHER TIME DEPOSITS                                 15       299     314     (207)     (361)     (568)
OTHER BORROWINGS                                   526       (34)    492      (24)       (4)      (28)
                                              --------------------------------------------------------

           TOTAL INTEREST BEARING LIABILITIES      952       925   1,877      (36)     (599)     (635)
                                              --------------------------------------------------------

                          NET INTEREST INCOME     $865     ($629)   $236     $622     ($213)     $409
                                              ========================================================
</TABLE>

                                       29
<PAGE>
<TABLE>
TABLE 3                                                       Summary of Net Interest Income
(000's omitted)                                                  Years Ended December 31,
                                            2000                          1999                           1998
ASSETS                          AVG BAL   INC/EXP  YIELD      AVG BAL   INC/EXP  YIELD        AVG BAL  INC/EXP  YIELD
                                -------------------------------------------------------------------------------------
<S>                             <C>       <C>      <C>         <C>      <C>      <C>          <C>      <C>     <C>
 Interest bearing deposits in         $0      $0   0.00%           $0      $0    0.00%           $16      $1   6.25%
Banks
 Investment securities:
   U.S. Treasury and              50,884   3,244   6.38%       51,098   3,091    6.05%        45,998   2,777   6.04%
Government Agencies
   State and Political            14,298     667   4.66%       12,365     583    4.71%        10,689     515   4.82%
   Other                           1,086      63   5.80%          814      65    7.99%           827      63   7.62%
                                -------------------------    --------------------------     -------------------------
   Total Investment Securities    66,268   3,974   6.00%       64,277   3,739    5.82%        57,514   3,355   5.83%
   Fed Funds Sold                  9,306     643   6.91%       12,100     592    4.89%        11,199     597   5.33%
 Loans:
   Commercial                    105,276  10,120   9.61%       90,985   8,804    9.68%        83,430   8,203   9.83%
   Tax Free                          618      34   5.50%          366      21    5.74%           409      23   5.62%
   Real Estate-Mortgage           23,552   2,130   9.04%       24,442   2,085    8.53%        19,601   1,946   9.93%
   Consumer                       68,342   6,412   9.38%       62,367   5,960    9.56%        68,344   6,821   9.98%
                                -------------------------    --------------------------     -------------------------
 Total loans                     197,788  18,696   9.45%      178,160  16,870    9.47%       171,784  16,993   9.89%
 Allowance for Loan Loss          (3,157)                      (2,928)                        (2,845)
 Net Loans                       194,631  18,696   9.61%      175,232  16,870    9.63%       168,939  16,993  10.06%
                                -------------------------    --------------------------     -------------------------
Loans Held for Sale                  184      14   7.63%          180      13    7.22%         7,016     494   7.04%
                                -------------------------    --------------------------     -------------------------
 TOTAL EARNING ASSETS           $273,546 $23,327   8.53%     $254,717 $21,214    8.33%      $247,529 $21,440   8.66%
                                -------------------------------------------------------------------------------------
 Cash Due from Banks              12,202                       10,149                          9,650
 All Other Assets                 13,390                       11,842                          9,278
                                ---------                    ---------                      ---------
TOTAL ASSETS                    $295,981                     $273,780                       $263,612
                                ---------                    ---------                      ---------
LIABILITIES & SHAREHOLDERS'
EQUITY:
  Deposits:
   Non-Interest bearing - DDA    $35,711                      $29,912                        $27,202
   Interest bearing - DDA         40,199     733   1.82%       41,996     713    1.70%        35,982     763   2.12%
   Savings Deposits               66,890   2,311   3.45%       66,141   1,943    2.94%        62,172   1,790   2.88%
   Time CD's $100,000 and Over    33,025   2,042   6.18%       25,226   1,359    5.39%        26,034   1,501   5.77%
   Other Time CD's                75,124   4,180   5.56%       74,827   3,866    5.17%        78,495   4,434   5.65%
                                -------------------------    --------------------------     -------------------------
 Total Deposits                  250,949   9,266   3.69%      238,102   7,881    3.31%       229,885   8,488   3.69%
 Other Borrowings                  9,509     624   6.56%        1,908     132    6.92%         2,249     160   7.11%
                                -------------------------    --------------------------     -------------------------
  INTEREST BEARING LIABILITIES  $224,747  $9,890   4.40%     $210,098  $8,013    3.81%      $204,932  $8,648   4.22%
                                -------------------------------------------------------------------------------------
 All Other Liabilities             1,958                        2,175                          2,512
 Shareholders Equity              33,565                       31,595                         28,966
                                ---------                    ---------                      ---------
 TOTAL LIABILITIES and S/H      $295,981                     $273,780                       $263,612
EQUITY
                                ---------        --------    ---------        ---------     ---------        --------
Net Interest Rate Spread                           4.13%                         4.51%                         4.44%
   Impact of Non-Int. Funds on                     0.78%                         0.67%                         0.73%
Margin
                                                 --------                     ---------                      --------
Net Interest Income/Margin               $13,437   4.91%              $13,201    5.18%               $12,792   5.17%
                                         ================             =================              ================
</TABLE>
                                       30
<PAGE>
ALLOWANCE AND PROVISION FOR POSSIBLE CREDIT LOSSES

The allowance for possible  credit losses reflects  management's  judgment as to
the level considered appropriate to absorb potential losses inherent in the loan
portfolio.  The Bank's  methodology in determining the adequacy of the allowance
includes a review of individual loans and off-balance sheet  arrangements,  size
and  composition of the loan  portfolio,  historical  loss  experience,  current
economic conditions, financial condition of borrowers, the level and composition
of non-performing loans, portfolio trends, estimated future net charge-offs, and
other  pertinent  factors.  Although  reserves  have been  allocated  to various
portfolio segments,  the allowance is general in nature and is available for the
portfolio in its  entirety.  At December 31, 2000,  the  allowance  for possible
credit  losses  was  $2,932,000  or 1.50% of total  loans.  This  compares  with
$2,961,000 or 1.55% at December 31, 1999 and  $2,783,000,  or 1.72%, at December
31, 1998. The  Corporation  has lowered the allowance for possible credit losses
as a percent of total loans because of overall asset quality.

The provision  for possible  credit losses was $584,000 in 2000 and $545,000 and
$724,000 in 1999 and 1998 respectively. The modest increase in provision in 2000
represents  management's efforts to maintain adequate reserves commensurate with
loan  growth.  The  decrease  in the  provision  in  1999  reflects  an  overall
improvement  in  asset  quality  and a  reduction  in loans  charged-off.  Loans
charged-off  decreased in 1999 because of a  non-repetitive,  substantial  write
down on a non-performing commercial loan in 1998. Table 4 summarizes loan losses
and recoveries from 1996 through 2000.  During 2000 the Corporation  experienced
net  charge-offs  of $613,000,  compared  with net  charge-offs  of $367,000 and
$896,000 in 1999 and 1998  respectively.  Accordingly,  the net charge-off ratio
for  2000  was  .31%  compared  to .19%  and  .55% at the end of 1999  and  1998
respectively.  The net  charge-off  ratio  increased in 2000  primarily due to a
write  down  on a  non-performing  commercial  loan.  The net  charge-off  ratio
decreased significantly in 1999 due to an increase in overall asset quality.

The Corporation  maintains formal policies and procedures to control and monitor
credit risk.  Management  believes the allowance  for possible  credit losses is
adequate to meet normal credit risks in the loan  portfolio.  The  Corporation's
loan  portfolio has no  significant  concentrations  in any one industry nor any
exposure in foreign loans.  The  Corporation  has not extended credit to finance
highly  leveraged  transactions  nor  does  it  intend  to do so in the  future.
Employment  levels and other  economic  conditions  in the  Corporation's  local
markets may have a significant impact on the level of credit losses.  Management
continues to identify and devote attention to credits that may not be performing
as agreed.  Because of these factors and the uncertainty of economic conditions,
management  expects to maintain  the  current  level of the  allowance  for loan
losses  as a  percentage  of  gross  loans  in 2001.  Non-performing  loans  are
discussed further in the section titled "Non-Performing Assets".
<TABLE>
TABLE 4
Analysis of the Allowance for Possible Credit Losses      Years Ended December 31,
(000's omitted)                                2000    1999        1998      1997      1996
--------------------------------------------------------------------------------------------
<S>                                          <C>      <C>        <C>       <C>       <C>
Balance Beginning of Period                  $2,961   $2,783     $2,955    $2,836    $2,618
                                          --------------------------------------------------
Charge-offs:
    Commercial, Financial and                  (284)     (72)      (454)      (69)     (154)
Agricultural
    Real Estate-Construction                      0        0          0         0         0
    Real Estate-Mortgage                          0       (2)       (77)        0       (50)
    Installment Loans to Individuals           (522)    (377)      (537)     (500)     (304)
                                          --------------------------------------------------
      Total Charge-offs                        (806)    (451)    (1,068)     (569)     (508)
                                          --------------------------------------------------
Recoveries:
    Commercial, Financial and                   107       13         43        15         7
Agricultural
    Real Estate-Construction                      0        0          0         0         0
    Real Estate-Mortgage                          0        0         37         4         8
    Installment Loans to Individuals             86       71         92        45        63
                                          --------------------------------------------------
Total Recoveries                                193       84        172        64        78
                                          --------------------------------------------------
Net Charge-offs                                (613)    (367)      (896)     (505)     (430)
                                          --------------------------------------------------
Provision                                       584      545        724       624       648
                                          --------------------------------------------------
Balance at End of Period                     $2,932   $2,961     $2,783    $2,955    $2,836
                                          ==================================================
Ratio of Net Charge-Offs During the           0.31%    0.19%      0.55%     0.28%     0.24%
Period
</TABLE>
                                       31
<PAGE>
OTHER OPERATING INCOME
<TABLE>
TABLE 5                                                          Years Ended
Analysis of Other Operating Income                              December 31,
-------------------------------------------------------------------------------------
(000's omitted)                                        2000        1999        1998
-------------------------------------------------------------------------------------
<S>                                                   <C>         <C>         <C>
Service Charges on Deposit Accounts                   $1,915      $1,972      $1,766
Gain on Sale of Mortgages                                179         108         283
Gain on Sale of Real Estate Owned                         25          89           8
Mortgage Servicing Fees                                  631         153         181
Fiduciary Income                                         695         581         562
Gain on Security Transactions                              0          24         112
Other Operating Income                                 1,083       1,335       1,116
                                                 ------------------------------------
  Total Non-Interest Income                           $4,528      $4,262      $4,028
                                                 ====================================
</TABLE>
Other operating income was $4,528,000 in 2000, $4,262,000 and $4,028,000 in 1999
and 1998  respectively.  These  amounts  represent  an  increase of 6.2% in 2000
compared to 1999 and an increase of 5.8% comparing 1999 to 1998.

The most  significant  category of other operating  income is service charges on
deposit accounts. These fees were $1,915,000 in 2000, compared to $1,972,000 and
$1,766,000 in 1999 and 1998 respectively.  This is a decrease of $57,000 or 2.9%
in 2000,  an increase of $206,000 or 11.7% in 1999,  and an increase of $182,000
or 11.5% in 1998. In 2000,  the decrease is  attributable  to higher  individual
checking and saving account balances  offsetting  service  charges.  In 1999 and
1998 increases in service charges are  attributable to growth in deposit totals,
the number of accounts and certain account activities.

Gains  on the  sale of  mortgage  loans  originated  by the Bank and sold in the
secondary market were $179,000 in 2000,  $108,000 in 1999, and $283,000 in 1998.
The 65.7% increase in 2000 is  attributable  to increases in mortgage loans made
and  subsequently  sold in the  secondary  market due to an increase in new home
purchase  activity.  The 61.9% decrease in 1999 is  attributable to decreases in
mortgage  loans  made and  subsequently  sold in the  secondary  market due to a
decrease  in new home  purchase  and  refinance  activity  due to the  impact of
changing  market rates.  The 31.6% increase in 1998 is attributable to increases
in mortgage loans made and  subsequently  sold in the secondary market due to an
increase in refinance activity brought on by market rates.

Mortgage servicing fees increased substantially in 2000. The fees increased from
$153,000 in 1999 to $631,000 in 2000. The increase is  attributable to a gain on
the sale of mortgage  servicing rights  associated with loans previously sold in
the secondary market.

Fiduciary income increased  $114,000 in 2000 to $695,000 compared to $581,000 in
1999 and $562,000 in 1998.  The 19.6% increase in 2000, and the 3.4% increase in
1999 are  attributable  to growth in the  assets  under  management  within  the
Corporation's  Investment  Trust Department and the market value of assets under
management.

In 1999, the Company recognized a $24,000 gain on security transactions compared
to  $112,000  in  security  gains in 1998.  These  gains are a result of several
transactions  wherein  the Company  sold  investment  securities  to reinvest in
issues which provided greater total income potential. In 2000 there were no sale
transactions and accordingly no gains.

Other operating income includes income from the sale of checks, safe deposit box
rent, merchant account income, ATM income, and other miscellaneous income items.
Other  operating  income was  $1,108,000  in 2000  compared  to  $1,335,000  and
$1,116,000 in 1999 and 1998 respectively. The decrease in 2000 compared to 1999,
and the  increase in 1999  compared to 1998 is primarily  attributable  to a one
time gain representing a premium received for deposits sold in connection with a
branch sale.

                                       32
<PAGE>
OTHER OPERATING EXPENSE
<TABLE>
TABLE 6                                                           Years Ended
Analysis of Other Operating Expense                               December 31,
---------------------------------------------------------------------------------------
(000's omitted)                                         2000         1999        1998
---------------------------------------------------------------------------------------
<S>                                                 <C>            <C>         <C>
Salaries and  Benefits                                 $5,801       $5,564      $5,025
Equipment                                               1,552        1,429       1,396
Net Occupancy                                             784          797         723
FDIC Assessment                                            50           27          28
Office Supplies                                           311          274         313
Loan & Collection Expense                                 289          373         356
Advertising and Promotional                               263          257         249
Other Operating Expenses                                2,386        2,415       2,458
                                                 --------------------------------------
  Total Non-Interest Expense                          $11,436      $11,136     $10,548
                                                 ======================================
</TABLE>
Total other operating expense was $11,436,000 in 2000 compared to $11,136,000 in
1999 and  $10,548,000  in 1998.  This is an increase of 2.7% in 2000 and 5.6% in
1999.

Salary and benefit costs,  the  Corporation's  largest other  operating  expense
category,  were  $5,801,000  in 2000,  compared  with  $5,564,000  in 1999,  and
$5,025,000 in 1998.  Increased costs are a result of annual salary increases and
staff  additions  in  connection  with the  spin-off  of two  branches to form a
separate bank.

In 2000,  equipment expenses were $1,552,000  compared to $1,429,000 in 1999 and
$1,396,000 in 1998, an increase of 8.6% in 2000 and an increase of 2.4% in 1999.
The increase in 2000 is attributable to depreciation costs. Depreciation expense
increased in connection with equipment leases and purchases including a new main
frame system.  Equipment  expenses increased in 1999 primarily because of higher
costs in  connection  with  maintenance  contracts.  A  minimal  portion  of the
increase  in  equipment  expense  in 1999 is  attributable  to  depreciation  on
replacement equipment to ensure Y2K compatibility. Overall the impact of Y2K was
insignificant.

Occupancy expenses associated with the Corporation's facilities were $784,000 in
2000  compared  to $797,000 in 1999 and  $723,000  in 1998.  In 2000,  this is a
decrease  of 1.6% and in 1999 an  increase  of 10.2%.  The  decrease  in 2000 is
attributable  to lower lease  expense as a result of a branch  sale in 1999.  In
1999 the increase is attributable to increases in facility repairs,  maintenance
contracts, and expenses connected with the opening of the "Loan Store".

Loan and collection expenses were $289,000 in 2000 compared to $373,000 in 1999,
and $356,000 in 1998. The $84,000 or 22.5% decrease in 2000 is attributable to a
decrease in dealer  service fees paid in  connection  with indirect auto lending
and a  decrease  in fees paid by the  Corporation  for the  origination  of home
equity loans. The $17,000 or 4.8% increase in 1999 is attributable to expense in
connection with the disposition of other real estate and increased legal expense
in connection with loan collections.

The final  category of  operating  expense is other  operating  expenses.  These
expenses were  $2,386,000 in 2000 compared to $2,415,000 in 1999, and $2,458,000
in 1998. These fees were lower in 2000 because of a reduction in costs for legal
and professional  fees. These expenses  decreased in 1999 because of lower costs
for check production.

FINANCIAL CONDITION

Proper  management of the volume and  composition of the  Corporation's  earning
assets and funding  sources is  essential  for  ensuring  strong and  consistent
earnings  performance,  maintaining  adequate liquidity and limiting exposure to
risks  caused  by  changing  market  conditions.  The  Corporation's  investment
securities  portfolio is  structured  to provide a source of  liquidity  through
maturities and generate an income stream with relatively low levels of principal
risk. The Corporation does not engage in securities trading.  Loans comprise the
largest component of earning assets and are the  Corporation's  highest yielding
assets.  Client

                                       33
<PAGE>
deposits are the primary  source of funding for earning  assets while short term
debt and other  sources of funds  could be  utilized  if market  conditions  and
liquidity needs change.

The  Corporation's  total assets averaged $296 million for 2000 exceeding 1999's
average of $274 million by $22 million or 8%. Average loans  comprised  66.8% of
total average  assets  during 2000  compared to 65.1% in 1999.  Loans grew $19.6
million on average with commercial loans leading the advance by $14.3 million or
15.7%. The ratio of average  non-interest bearing deposits to total deposits was
14.2% in 2000 compared to 12.6% during 1999. Interest bearing deposits comprised
95.8% of total average interest bearing  liabilities  during 2000, down slightly
from 99.1% during 1999.

INVESTMENT SECURITIES PORTFOLIO

Investment  securities  (including  equity  securities)  totaled  $66,704,000 at
December  31, 2000  compared to  $67,886,000  at December  31,  1999.  This is a
decrease of $1,182,000 or 1.7%. The decrease in 2000, resulted  principally from
maturing principal throughout the year, which due to stronger demand was used to
fund new loans. At December 31, 2000 these investment securities comprised 24.8%
of earning assets, down from 26.1% at December 31, 1999. A summary of investment
securities  balances  (including   available  for  sale  and  held  to  maturity
securities)  at the  end  of  the  last  five  years  are  included  below.  The
Corporation  considers all of its  investments  as available for sale except for
Michigan tax exempt securities which are classified as held to maturity.
<TABLE>
TABLE 7
Investment Securities
(000's omitted)
December 31,                                        2000        1999       1998       1997      1996
-----------------------------------------------------------------------------------------------------
<S>                                               <C>        <C>        <C>         <C>       <C>
U.S. Treasury                                         $0          $0     $1,000     $5,981    $7,943
Federal Agencies:
  Mortgage-backed                                 19,237      21,520     12,690      3,535     2,833
  Other                                           32,125      31,365     51,626     36,184    32,863
Tax-Exempt State and Municipal                    14,247      13,922     11,377      9,590     6,530
Other                                              1,095       1,079      1,263        760       716
                                             --------------------------------------------------------
  Total Investment Securities                    $66,704     $67,886    $77,956    $56,050   $50,885
</TABLE>
Table 8 contains the amortized  cost,  fair value,  and yields of the classes of
debt  investment  securities  for  each  of the  last  two  years.  As the  data
indicates, investment securities balances from December 31, 1999 to December 31,
2000 have  decreased.  Increases in loan balances from new loan growth in excess
of the amount of deposit  growth,  accounts for the decrease in  investments  in
2000.

The  Corporation's  present  policies  with  respect  to the  classification  of
investments  in  debt  and  equity  securities  are  discussed  in Note A to the
Consolidated   Financial  Statements.   An  analysis  of  investment  securities
classifications,  excluding  equity  securities at year end for each of the last
two years is  presented  in Table 8. As of  December  31,  2000,  the  estimated
aggregate fair value of the Corporation's debt investment  securities  portfolio
was $2,000 above  amortized  cost. At December 31, 2000 gross  unrealized  gains
were $246,000 and gross unrealized losses were $244,000.  A summary of estimated
fair  values and  unrealized  gains and losses for the major  components  of the
investment  securities  portfolio  is  provided  in  Note C to the  Consolidated
Financial Statements.

                                       34
<PAGE>
<TABLE>
TABLE 8
Analysis of Investment Securities
                                                  2000                         1999
                                     Amortized    Fair             Amortized   Fair
(000's omitted)                        Cost      Value    Yield      Cost      Value   Yield
---------------------------------------------------------------------------------------------
<S>                                   <C>        <C>       <C>       <C>       <C>      <C>
Available for Sale:
  U.S. Treasuries                          $0        $0    0.00%         $0        $0   0.00%
  U.S. Agencies                        32,144    32,125    6.19%     31,128    30,447   6.16%
  Mortgage backed                      19,352    19,237    5.96%     22,273    21,521   5.96%
  Tax exempt State and Municipal          964       964    6.51%        920       917   6.59%
Held To Maturity:
  Tax exempt State and Municipal       13,283    13,419    6.56%     13,922    13,774   6.22%
                                   ----------------------------------------------------------

  Total                               $65,743   $65,745    6.20%    $68,243   $66,659   6.11%
                                   ==========================================================

Average Maturity                                   3.34    Years                 4.45  Years
</TABLE>
The following  table shows,  by class of  maturities  at December 31, 2000,  the
amounts and weighted average yields of debt investment securities.

<TABLE>
TABLE 9
Analysis and Maturities of Investment Securities
                                     Amortized       Fair
(000's omitted)                        Cost         Value          Yield
--------------------------------------------------------------------------
<S>                                <C>             <C>             <C>
AVAILABLE FOR SALE
U.S. Agencies
  One year or less                      $4,114       $4,129         6.34%
  Over one through five years           24,022       24,012         6.13%
  Over five through ten years            4,008        3,984         6.42%
  Over ten years                             0            0         0.00%
                                 ---------------------------
    Total                               32,144       32,125
Mortgage-Backed
  One year or less                          $0           $0
  Over one through five years              177          176         6.39%
  Over five through ten years            6,966        6,991         6.30%
  Over ten years                        12,209       12,070         5.85%
                                 ---------------------------
    Total                               19,352       19,237
State and Political
  One year or less                        $964         $964         6.51%
  Over one through five years                0            0
  Over five through ten years                0            0
  Over ten years                             0            0
                                 ---------------------------
    Total                                  964          964

HELD TO MATURITY
State and Political
  One year or less                      $4,139       $4,156         7.23%
  Over one through five years            4,503        4,544         6.45%
  Over five through ten years            2,524        2,592         6.84%
  Over ten years                         2,117        2,127         6.59%
                                 ---------------------------
    Total                               13,283       13,419
Total Investment Securities            $65,743      $65,745
</TABLE>

                                       35
<PAGE>
LOAN PORTFOLIO

The Corporation extends credit primarily within in its local markets in Genesee,
Oakland, and Livingston counties. The Corporation's commercial loan portfolio is
widely  diversified with no concentration  within a single industry that exceeds
10% of total loans.  The  Corporation's  respective loan portfolio  balances are
summarized in Table 10.

Total  loans  increased  $4,042,000  at  December  31,  2000,  with total  loans
comprising  72.5% of earning  assets as compared  to 71.5% of December  31, 1999
earning assets.  Local economic  conditions remained strong throughout 2000. The
strength of the local economy  supported  continued  commercial  business growth
including  commercial  development.  Accordingly,  the  Corporation  experienced
strong  demand  for  commercial  loans.  In  2000,  commercial  loans  increased
approximately  $9,000,000 to  $101,925,000 or 9.7% .  Additionally,  real estate
construction and development loans increased $4,990,000 or 40% to $17,471,000 at
December 31, 2000.  Consumer loans increased  modestly in 2000 while real estate
mortgage loans decreased due to the sale of  approximately  $10,000,000 in fixed
rate mortgage loans in the last quarter of 2000.

During 1999, the Corporation experienced a significant amount of commercial loan
demand  brought on by strong  growth  within our market  areas.  Because of this
demand,  commercial loans increased $14,064,000 or 17.8% in 1999. Mortgage loans
also increased  significantly in 1999 primarily due to a management  decision to
hold  certain  loans  as  portfolio  loans as  opposed  to  selling  them in the
secondary market. Accordingly, mortgage loans increased $9,768,000 in 1999.

Management expects the local economy to support continued growth and development
in 2001 and will aggressively seek out new loan  opportunities  while continuing
to maintain sound credit quality.

<TABLE>
TABLE 10
Loan Portfolio
December 31,
(000's omitted)                         2000          1999         1998          1997          1996
-----------------------------------------------------------------------------------------------------
<S>                                  <C>           <C>           <C>           <C>          <C>
Commercial                            $101,925      $92,896       $78,832       $81,544      $79,450
Real estate - construction              17,471       12,481         9,010        14,589       15,467
Real estate - mortgage                  10,514       21,409        11,641        15,007       15,924
Consumer                                65,198       64,280        62,423        69,533       64,388
                                 --------------------------------------------------------------------
  Total                               $195,108     $191,066      $161,906      $180,673     $175,229
                                 ====================================================================
</TABLE>
NON-PERFORMING ASSETS

Non-performing  assets  include  loans on which  interest  accruals have ceased,
loans  which  have  been   re-negotiated,   and  real  estate  acquired  through
foreclosure. Past due loans are loans which were delinquent 90 days or more, but
have not been placed on  non-accrual  status.  Table 11 represents the levels of
these assets at December 31, 1996 through 2000.

The improvement in total non-performing  assets at December 31, 2000 compared to
1999 is  attributable to the sale and disposition of other real estate owned and
in redemption, offset by only a modest increase in non-performing loans.

The improvement or decrease in non-performing  loans in 1999 as compared to 1998
and in  1998  compared  to 1997  is the  result  of  various  factors  including
successful workout strategies and charges to the allowance for loan losses.

The level and  composition  of  non-performing  assets are  affected by economic
conditions  in  the   Corporation's   local  markets.   Non-performing   assets,
charge-offs, and provisions for possible credit losses

                                       36
<PAGE>
tend to decline in a strong economy and increase in a weak economy,  potentially
impacting the  Corporation's  operating  results.  In addition to non-performing
loans,  management carefully monitors other credits that are current in terms of
principal and interest payments but, in management's opinion, may deteriorate in
quality if economic conditions change.

<TABLE>
TABLE 11
Non-Performing Assets and Past Due Loans
                                                      December 31,
                                             2000         1999         1998           1997      1996
                                         ----------------------------------------------------------------
<S>                                        <C>           <C>          <C>         <C>          <C>
Non-Performing Loans:
  Loans Past Due 90 Days or More & Still
    Accruing                                 $489,000     $240,000     $168,000    $618,000     $123,000
  Non-Accrual Loans                           731,000      859,000    1,102,000   1,866,000      575,000
  Renegotiated Loans                                0        6,000        7,000       8,000            0
                                         ----------------------------------------------------------------
    Total Non-Performing Loans              1,220,000    1,105,000    1,277,000   2,492,000      698,000
                                         ----------------------------------------------------------------
Other Non-Performing Assets:
  Other Real Estate                                 0      288,000      172,000           0       56,000
  Other Real Estate Owned  in                       0      179,000       96,000           0            0
Redemption
  Other Non-Performing  Assets                159,000       56,000       39,000      94,000       28,000
                                         ----------------------------------------------------------------
    Total Other Non-Performing Assets         159,000      523,000      307,000      94,000       84,000
                                         ----------------------------------------------------------------
Total Non-Performing Assets                $1,379,000   $1,628,000   $1,584,000  $2,586,000     $782,000
                                         ================================================================
Non-Performing Loans as a % of
  Total Loans                                   0.63%        0.58%        0.79%       1.38%        0.40%
Non-Performing Assets as a % of
  Total Loans and Other Real Estate             0.71%        0.85%        0.98%       1.43%        0.45%
Allowance for Loan Losses as a % of
  Non-Performing Loans                        240.33%      267.96%      217.93%     118.58%      406.30%
Allowance for Loan Losses, Other Real
  Estate, and In-Substance Foreclosures
  as a % of Non-Performing Assets             212.62%      199.57%      192.61%     114.27%      369.82%
Accruing Loans Past Due 90 Days or
  More to Total Loans                           0.25%        0.13%        0.10%       0.34%        0.07%
Non-performing Assets as a % of
  Total Assets                                  0.47%        0.57%        0.58%       0.98%        0.31%
</TABLE>
Table 12 reflects the  allocation  of the allowance for loan losses and is based
upon ranges of estimates and is not intended to imply either  limitations on the
usage of the  allowance or precision of the specific  amounts.  The  Corporation
does not view the allowance for loan losses as being divisible among the various
categories  of loans.  The entire  allowance  is  available to absorb any future
losses  without  regard to the category or categories  in which the  charged-off
loans are classified. Table 12 also reflects the percentage ratio of outstanding
loans by category to total loans at the end of the respective year.
<TABLE>
TABLE 12
Allocation of the Allowance for Loan Losses

                                2000             1999              1998             1997              1996
December 31,                        Loan             Loan              Loan             Loan              Loan
(000's omitted)            Amount     %      Amount     %     Amount     %      Amount     %     Amount     %
-----------------------------------------------------------------------------------------------------------------
<S>                        <C>     <C>       <C>     <C>      <C>      <C>      <C>     <C>      <C>      <C>
Commercial                 $1,645   58.69%   $1,682  53.19%   $1,270   51.69%   $1,416  49.65%   $1,065   48.56%
Real estate mortgage           94    7.89%      144  13.17%      130    9.76%      153  11.86%      370   14.70%
Consumer                      890   33.42%      963  33.64%      983   38.56%    1,376  38.49%    1,374   36.74%
Unallocated                   303               172              400                10               27
-----------------------------------------------------------------------------------------------------------------
  Total                    $2,932  100.00%   $2,961 100.00%   $2,783  100.00%   $2,955 100.00%   $2,836  100.00%
                         ========================================================================================
</TABLE>

                                       37
<PAGE>
The following  describes the  Corporation's  policy and related  disclosures for
impaired  loans.  The  Corporation  maintains an allowance for impaired loans. A
loan is considered  impaired when management  determines it is probable that the
principal and interest due under the  contractual  terms of the loan will not be
collected. In most instances,  impairment is measured based on the fair value of
the underlying collateral.  Impairment may also be measured based on the present
value of expected future cash flows discounted at the loan's effective  interest
rate.  Interest  income on impaired  non-accrual  loans is  recognized on a cash
basis.  Interest  income on all other  impaired  loans is recorded on an accrual
basis.

Certain  of the  Corporation's  non-performing  loans  included  in Table 11 are
considered  impaired.  The Corporation  measures impairment on all large balance
non-accrual  commercial  loans.  Certain  large  balance  accruing  loans  rated
substandard  or worse are also measured for  impairment.  Impairment  losses are
adequately  covered by the provision for loan losses.  The policy does not apply
to large  groups of smaller  balance  homogeneous  loans  that are  collectively
evaluated for impairment.  Loans  collectively  evaluated for impairment include
certain smaller balance  commercial  loans,  consumer  loans,  residential  real
estate loans,  and credit card loans,  and are not included in the impaired loan
data in the following paragraphs.

At December 31, 2000, loans considered to be impaired  totaled  $2,315,000.  All
amounts included within impaired loans required specific allowance.  The average
recorded  investment  in impaired  loans was  $1,932,000  in 2000.  The interest
income  recognized on impaired loans based on cash collections  totaled $146,000
during 2000.

At December 31, 1999, loans considered to be impaired  totaled  $1,548,000.  All
amounts  included in impaired loans  required  specific  allowance.  The average
recorded  investment  in impaired  loans was  $1,848,000  in 1999.  The interest
income  recognized on impaired loans based on cash collections  totaled $299,000
during 1999.

The  Corporation  maintains  policies  and  procedures  to identify  and monitor
non-accrual  loans. A loan is placed on  non-accrual  status when there is doubt
regarding collection of principal or interest,  or when principal or interest is
past due 90 days or more. Interest accrued but not collected is reversed against
income for the current  quarter and charged to the allowance for loan losses for
prior quarters when the loan is placed on non-accrual status.

DEPOSITS
<TABLE>
TABLE 13
Average Deposits
Years Ended December 31,       2000               1999              1998              1997              1996
                         Average  Average   Average  Average  Average  Average  Average  Average  Average  Average
(000's omitted)          Balance    Rate    Balance    Rate   Balance    Rate   Balance   Rate    Balance    Rate
-----------------------------------------------------------------------------------------------------------------
<S>                      <C>        <C>     <C>        <C>    <C>        <C>    <C>       <C>     <C>        <C>
Non-int. bearing demand  $35,711            $29,912           $27,202           $26,447           $26,895
Interest-bearing demand   40,199    1.82%    41,996    1.70%   35,982    2.12%   32,380   2.30%    30,534    2.48%
Savings                   66,890    3.45%    66,141    2.94%   62,172    2.88%   59,892   3.31%    56,536    3.11%
Time                     108,149    5.75%   100,053    5.23%  104,529    5.68%  107,388   5.84%   100,840    5.82%
                        -----------------------------------------------------------------------------------------
  Total                 $250,949    3.69%   $238,102   3.31% $229,885    3.69% $226,107   3.98%  $214,805    3.91%
                        =========================================================================================
</TABLE>
The Corporation's average deposit balances and rates for the past five years are
summarized  in Table 13.  Total  average  deposits  were 5.4%  higher in 2000 as
compared  to 1999.  Deposit  growth was  derived  primarily  from  increases  in
non-interest bearing demand and time deposits.  Interest-bearing demand deposits
comprised  16.0% of total deposits  while savings  deposits  comprised  26.7% of
total deposits.

As of December 31, 2000  certificates  of deposit of $100,000 or more  accounted
for  approximately  13.8% of total  deposits  compared to 11.4% at December  31,
1999. The maturities of these deposits are summarized in Table 14.

                                       38
<PAGE>
<TABLE>
TABLE 14
Maturity of Time Certificates of Deposit of $100,000 or More
                                   December 31,
(000's omitted)                       2000
-----------------------------------------------
<S>                               <C>
Three months or less                   $16,673
Over three through six months            9,453
Over six through twelve months           3,822
Over twelve months                       4,311
                                 --------------
  Total                                 34,259
                                 ==============
</TABLE>
FEDERAL INCOME TAXES

The Corporation's effective tax rate was 29% for 2000 and 31% for 1999 and 1998.
The principal  difference  between the effective tax rates and the statutory tax
rate of 34% is the  Corporation's  investment  in  securities  and  loans  which
provide income exempt from federal income tax. Additional  information  relating
to federal  income  taxes is  included in Note H to the  Consolidated  Financial
Statements.

LIQUIDITY AND INTEREST RATE RISK MANAGEMENT

Asset/Liability  management is designed to assure  liquidity and reduce interest
rate risks. The goal in managing  interest rate risk is to maintain a strong and
relatively  stable  net  interest  margin.  It  is  the  responsibility  of  the
Asset/Liability  Management  Committee  (ALCO) to set policy  guidelines  and to
establish  short-term  and  long-term  strategies  with respect to interest rate
exposure and  liquidity.  The ALCO,  which is comprised of key members of senior
management,  meets  regularly to review  financial  performance  and  soundness,
including  interest rate risk and liquidity  exposure in relation to present and
prospective markets, business conditions,  and product lines.  Accordingly,  the
committee  adopts  funding  and balance  sheet  management  strategies  that are
intended to maintain  earnings,  liquidity,  and growth  rates  consistent  with
policy and prudent business standards.

Liquidity  maintenance,  together with a solid capital base and strong  earnings
performance  are key  objectives  of the  Corporation.  The Bank's  liquidity is
derived  from a  strong  deposit  base  comprised  of  individual  and  business
deposits.  Deposit  accounts  of  customers  in the mature  market  represent  a
substantial  portion of deposits of  individuals.  The Bank's  deposit base plus
other  funding  sources   (federal  funds  purchased,   other   liabilities  and
shareholders'  equity)  provided  primarily all funding needs in 2000, 1999, and
1998.  While these  sources of funds are expected to continue to be available to
provide funds in the future,  the mix and availability of funds will depend upon
future  economic and market  conditions.  The  Corporation  does not foresee any
difficulty in meeting its funding requirements.

Primary  liquidity is provided  through  short-term  investments  or  borrowings
(including  federal  funds sold and  purchased),  while  secondary  liquidity is
provided by the investment portfolio. As of December 31, 2000 federal funds sold
represented  2.5% of  total  assets,  compared  to .3% at the end of  1999.  The
Corporation  regularly monitors liquidity to ensure adequate cash flows to cover
unanticipated reductions in the availability of funding sources.

Interest rate risk is managed by controlling  and limiting the level of earnings
volatility  arising from rate  movements.  The  Corporation  regularly  performs
reviews and analyses of those  factors  impacting  interest  rate risk.  Factors
include maturity and re-pricing frequency of balance sheet components, impact of
rate changes on interest margin and prepayment  speeds,  market value impacts of
rate changes,  and other  issues.  Both actual and  projected  performance,  are
reviewed,  analyzed, and compared to policy and objectives to assure present and
future financial viability.

                                       39
<PAGE>
The Corporation  had cash flows from financing  activities  resulting  primarily
from the growth of certificates of deposit and short-term  borrowings.  In 2000,
these deposits increased $6,462,000 and these borrowings  increased  $3,315,000.
Cash used in investing activities was $3,347,000 in 2000 compared to $23,424,000
in 1999 and  $4,490,000  in 1998.  The decrease in investing  activities in 2000
resulted from the increase in  origination  of loans and a decrease in investing
activities.

RISK ELEMENTS AND MANAGEMENT

Credit risk is managed via specific credit approvals and monitoring  procedures.
The Corporation's  outside loan review function examines the loan portfolio on a
periodic basis for compliance  with credit  policies and for  identification  of
problem loans.  These procedures provide management with information for setting
appropriate direction and taking corrective action as needed.

The Corporation  closely monitors its construction and commercial  mortgage loan
portfolios.  Construction  loans at December 31, 2000,  which  comprised 9.0% of
total loans,  totaled  $17,471,000 as compared to $12,481,000  and $9,010,000 at
the end of 1999 and 1998 respectively.

The  construction  and  commercial  real  estate  loan  properties  are  located
principally in the  Corporation's  local markets.  Included are loans to various
industries and professional  organizations.  The Corporation believes that these
portfolios  are well  diversified  and do not present a significant  risk to the
institution.

CAPITAL RESOURCES

Management  closely  monitors  capital  levels to provide for current and future
business  needs  and  to  comply  with  regulatory   requirements.   Regulations
prescribed under the Federal Deposit  Insurance  Corporation  Improvement Act of
1991  have  defined  "well  capitalized"  institutions  as  those  having  total
risk-based  ratios,  tier 1 risk-based capital ratios and tier 1 leverage ratios
of at least 10%, 6%, and 5% respectively.  At December 31, 2000, the Corporation
was well in excess of the minimum capital and leverage requirements necessary to
be considered a "well capitalized" banking company as defined by federal law.

Total  shareholders'  equity rose 12.2% to  $35,754,000  at December  31,  2000,
compared with  $31,865,000  at December 31, 1999.  The  Corporation's  equity to
asset ratio was 12.2% at December  31,  2000,  compared to 11.2% at December 31,
1999.  The  increase  in the amount of capital  was  obtained  through  retained
earnings  and the  proceeds  from the  issuance  of new  shares.  In  2000,  the
Corporation increased its cash dividends by 4.3% to $.97 per share compared with
$.93 in 1999.

At December 31, 2000,  the  Corporation's  tier 1 and total  risk-based  capital
ratios  were 15.0% and  16.2%,  respectively,  compared  with 13.0% and 14.3% in
1999.  The  Corporation's  tier 1 leverage  ratio was 12.1% at December 31, 2000
compared with 11.2% at December 31, 1999. These increases in risk-based  capital
ratios are largely attributable to an increase in federal funds sold investments
at December 31, 2000, and the increases in capital.

QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Fentura Bancorp, Inc. faces market risk to the extent that both earnings and the
fair value of its  financial  instruments  are  affected  by changes in interest
rates. The Corporation  manages this risk with static GAP analysis and has begun
simulation   modeling.   Throughout  2000,  the  results  of  these  measurement
techniques were within the Corporation's policy guidelines. The Corporation does
not  believe  that  there  has  been a  material  change  in the  nature  of the
Corporation's primary market risk exposures,  including the categories of market
risk to which the Corporation is exposed and the particular markets that present
the  primary  risk of loss to the  Corporation,  or in how those  exposures  are
managed in 2000 compared to 1999.

The Corporation's  market risk exposure is mainly comprised of its vulnerability
to interest rate risk. Prevailing interest rates and interest rate relationships
in the future will be primarily  determined by market  factors which are outside
of

                                       40
<PAGE>
the Corporation's  control. All information provided in this section consists of
forward looking statements.  Reference is made to the section captioned "Forward
Looking Statements" in this annual report for a discussion of the limitations on
the Corporation's responsibility for such statements.

The following  table  provides  information  about the  Corporation's  financial
instruments  that are sensitive to changes in interest  rates as of December 31,
2000. They show expected cash flows from market  sensitive  instruments for each
of the next five years and  thereafter.  The expected  maturity  date values for
loans  (including  loans held for sale) and investment  securities (at amortized
cost) were calculated  without adjusting the instruments'  contractual  maturity
dates for expected  prepayments.  Maturity date values for interest bearing core
deposits were not based on estimates of the period over which the deposits would
be  outstanding,  but rather the  opportunity  for  re-pricing.  The Corporation
believes that re-pricing  dates, as opposed to expected  maturity dates,  may be
more  relevant in analyzing  the value of such  instruments  and are reported as
such in the following table.
<TABLE>
TABLE 15
Rate Sensitivity of Financial Instruments
(000's omitted)                    2001      2002      2003      2004      2005     Thereafter    Total
----------------------------------------------------------------------------------------------------------
<S>                                <C>       <C>       <C>       <C>       <C>        <C>        <C>
         Rate Sensitive Assets:
      Fixed interest rate loans    $22,639   $17,361   $18,792   $23,771   $21,465    $31,614    $135,642
          Average interest rate      9.39%     9.60%     9.56%     9.15%     9.44%      7.71%
   Variable interest rate loans    $36,737    $6,368    $3,683   $12,003        $0       $862     $59,653
          Average interest rate     10.36%    10.40%    10.31%    10.35%    10.24%      8.89%
            Fixed interest rate     $9,232   $11,302   $13,435    $2,680    $1,276    $27,627     $65,552
                     securities
          Average interest rate      6.76%     6.09%     6.05%     6.89%     6.39%      6.12%
         Variable Interest rate                                                        $1,152      $1,152
                     securities
          Average interest rate                                                         5.83%
  Other interest bearing assets     $7,250                                                         $7,250
          Average interest rate      6.44%

    Rate Sensitive Liabilities:
      Interest-bearing checking    $37,165                                                        $37,165
          Average interest rate      1.71%
                        Savings    $66,186                                                        $66,186
          Average interest rate      3.45%
                           Time    $75,269   $22,597      $6,421  $5,985        $0       $271    $110,543
          Average interest rate      5.80%     6.10%       5.96%   5.95%     6.58%      4.69%
          Short term borrowings     $4,680                                                         $4,680
          Average interest rate      5.92%
                  FHLB advances        $10       $10         $10     $10       $10     $1,101      $1,151
          Average interest rate      7.34%     7.34%       7.34%   7.34%     7.34%      7.34%
</TABLE>

INTEREST RATE SENSITIVITY MANAGEMENT

Interest rate sensitivity  management seeks to maximize net interest income as a
result  of  changing  interest  rates,   within  prudent  ranges  of  risk.  The
Corporation  attempts to accomplish  this objective by  structuring  the balance
sheet so that re-pricing  opportunities exist for both assets and liabilities in
roughly equivalent amounts at approximately the same time intervals.  Imbalances
in these  re-pricing  opportunities  at any  point in time  constitute  a bank's
interest  rate   sensitivity.   The  Corporation   currently  does  not  utilize
derivatives in managing interest rate risk.

An  indicator  of  the  interest  rate  sensitivity  structure  of  a  financial
institution's  balance  sheet  is  the  difference  between  its  interest  rate
sensitive assets and interest rate sensitive liabilities,  and is referred to as
"GAP".

Table 16 sets forth the distribution of re-pricing of the Corporation's  earning
assets and interest  bearing  liabilities  as of December 31, 2000, the interest
rate sensitivity GAP, as defined above, the cumulative interest rate sensitivity
GAP, the interest  rate  sensitivity  GAP ratio (i.e.  interest  rate  sensitive
assets  divided by  interest  rate  sensitive  liabilities)  and the  cumulative
sensitivity  GAP  ratio.  The table  also sets  forth the time  periods in which
earning assets and  liabilities  will mature or may re-price in accordance  with
their contractual terms.

                                       41
<PAGE>
<TABLE>
TABLE 16                                                        Gap Analysis
                                                                      December 31, 2000
                                                      Within       Three      One to      After
                                                       Three      Months-      Five       Five
(000's Omitted)                                       Months     One Year     Years       Years       Total
-------------------------------------------------------------------------------------------------------------
<S>                                                <C>           <C>          <C>         <C>        <C>
  Interest Bearing Bank Deposits                          $0          $0          $0          $0          $0
  Federal Funds Sold                                   7,250           0           0           0       7,250
  Investment Securities                                1,172       9,212      28,692      27,628      66,704
  Loans                                               72,538       9,265      81,389      31,916     195,108
  Loans Held for Sale                                    187           0           0           0         187
                                                 ------------------------------------------------------------
    Total Earning Assets                             $81,147     $18,477    $110,081     $59,544    $269,249
                                                 ============================================================
Interest Bearing Liabilities:
  Interest Bearing Demand Deposits                   $37,165          $0          $0          $0     $37,165
  Savings Deposits                                    23,371           0           0      42,815      66,186
  Time Deposits Less than $100,000                    19,387      26,768      30,054          75      76,284
  Time Deposits Greater than $100,000                 16,673      13,275       4,311           0      34,259
  Federal Funds Purchased                              3,250                                           3,250
  Other Borrowings                                     1,430          10          40       1,101       2,581
                                                 ------------------------------------------------------------
    Total Interest Bearing Liabilities              $101,276     $40,053     $34,405     $43,991    $219,725
                                                 ============================================================
Interest Rate Sensitivity GAP                       ($20,129)   ($21,576)    $75,676     $15,553     $49,524
Cumulative Interest Rate
  Sensitivity GAP                                   ($20,129)   ($41,705)    $33,971     $49,524
Interest Rate Sensitivity GAP                          -0.80       -0.46        3.20        1.35
Cumulative Interest Rate
  Sensitivity GAP Ratio                                -0.80       -0.70        1.19        1.23
</TABLE>
As indicated in Table 16, the short-term (one year and less) cumulative interest
rate  sensitivity  gap  is  negative.  Accordingly,  if  market  interest  rates
increase, this negative gap position would have a short- term negative impact on
interest margin.  Conversely,  if market interest rates decrease,  this negative
gap  position  would  have a  short-term  positive  impact on  interest  margin.
However,  gap analysis is limited and may not provide an accurate  indication of
the impact of general  interest rate movements on the net interest  margin since
the re-pricing of various categories of assets and liabilities is subject to the
Corporation's needs,  competitive pressures,  and the needs of the Corporation's
customers.  In addition,  various assets and liabilities indicated as re-pricing
within the same  period may in fact  re-price  at  different  times  within such
period  and at  different  rate  indices.  The  Corporation  is  implementing  a
sophisticated computer program to perform analysis of interest rate risk, assist
with   asset/liability   management,   and  model  and  measure   interest  rate
sensitivity.


ACCOUNTING AND REPORTING DEVELOPMENTS

The  Financial  Accounting  Standards  Board  (FASB)  has  issued  Statement  of
Financial  Accounting  Standard  (SFAS) No. 133, (as amended),  "Accounting  for
Derivative Instruments and Hedging Activities." The statement requires an entity
to recognize all derivatives as either assets or liabilities in the statement of
financial position and measure those instruments at fair value. The statement is
effective in 2001 for the Corporation.  However, management does not expect this
pronouncement  to  have a  significant  impact  on the  Corporation's  financial
position or results of operations.

In September  2000, the FASB issued SFAS No. 140,  "Accounting for Transfers and
Servicing of Financial  Assets and  Extinguishments  of Liabilities"  ("SFAS No.
140") which  replaces  SFAS No. 125  "Accounting  for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities" ("SFAS No. 125"), issued in
June 1996. It revises the standards for accounting for securitizations and other
transfers of financial assets and collateral and requires  certain  disclosures,
but it carries over most of SFAS No. 125's provisions without reconsideration.

SFAS No. 140 is effective for  transfers  and servicing of financial  assets and
extinguishments of liabilities occurring after March 31, 2001. Implementation of
SFAS No.  140 is not  expected  to have a material  effect on the  Corporation's
financial position or results of operations.

                                       42
<PAGE>
FORWARD LOOKING STATEMENTS

This  discussion and analysis of financial  condition and results of operations,
and  other  sections  of  the  Financial  Statements,  contain  forward  looking
statements  that  are  based  on  management's  beliefs,  assumptions,   current
expectations,  estimates and projections about the financial  services industry,
the economy,  and about the  Corporation  itself.  Words such as  "anticipates,"
"believes,"   "estimates,"   "expects,"  "forecasts,"  "intends,"  "is  likely,"
"plans,"  "projects,"  variations  of such  words and  similar  expressions  are
intended to identify such forward looking  statements.  These statements are not
guarantees of future  performance and involve certain risks,  uncertainties  and
assumptions  ("Future  Factors")  which are  difficult to predict with regard to
timing, extent, likelihood and degree of occurrence.  Therefore,  actual results
and  outcomes  may  materially  differ from what may be expressed or forecast in
such forward looking  statements.  The  Corporation  undertakes no obligation to
update,  amend  or  clarify  forward  looking  statements  as a  result  of  new
information, future events, or otherwise.

Future Factors that could cause a difference  between an ultimate actual outcome
and a  preceding  forward  looking  statement  include,  but are not limited to,
changes in interest rate and interest rate  relationships,  demands for products
and services,  the degree of  competition  by  traditional  and  non-traditional
competitors, changes in banking laws or regulations, changes in tax laws, change
in prices,  the impact of  technological  advances,  government  and  regulatory
policy changes,  the outcome of pending and future litigation and contingencies,
trends in customer  behavior as well as their  ability to repay  loans,  and the
local economy.

FENTURA BANCORP, INC. COMMON STOCK

Table 17 sets forth the high and low market information for each quarter of 1998
through 2000.  These  quotations  reflect  inter-dealer  prices,  without retail
mark-up, mark-down, or commission and may not represent actual transactions.  As
of March  13,  2001,  there  were 602  shareholders  of  record,  not  including
participants in the Company's employee stock option program.
<TABLE>
TABLE 17
Common Stock Data
                                      Market                           Dividends
                                   Information                           Paid
    Year         Quarter               High         Low                Per Share
-------------------------------------------------------------------------------------
<S>           <C>                     <C>         <C>                <C>
              First Quarter           $23.33      $22.08                  $0.175
    1998      Second Quarter           42.19       31.67                   0.175
              Third Quarter            41.67       34.38                   0.175
              Fourth Quarter           42.50       38.75                   0.350
                                                                     ------------
                                                                          $0.880


              First Quarter           $46.67      $40.83                  $0.190
    1999      Second Quarter           45.00       44.17                   0.190
              Third Quarter            47.19       37.50                   0.190
              Fourth Quarter           42.29       31.67                   0.360
                                                                     ------------
                                                                          $0.930


              First Quarter           $40.83      $29.27                  $0.210
    2000      Second Quarter           37.00       24.99                   0.210
              Third Quarter            30.00       24.63                   0.210
              Fourth Quarter           26.50       22.00                   0.340
                                                                     ------------
                                                                          $0.970
</TABLE>
Note:  Dividend per share figures have been adjusted to reflect a 20% stock
       dividend distributed on May 26, 2000.


                                       43
<PAGE>
                                  Exhibit 21.1
                         Subsidiaries of the Registrant


   Company                               Ownership        State of Incorporation
   -------                               ---------        ----------------------
The State Bank                             100%                  Michigan

Davison State Bank                         100%                  Michigan

Community Bank Services, Inc.      100% by The State Bank        Michigan

Fentura Mortgage Company, Inc.     100% by The State Bank        Michigan
<PAGE>
                                  EXHIBIT 23.1

                       CONSENT OF INDEPENDENT ACCOUNTANTS


     We consent to the incorporation by reference in the Registration  Statement
of Fentura  Bancorp,  Inc. on Form S-3 (File No.  333-4668)  of our report dated
January  26,  2001 on the 2000  Consolidated  Financial  Statements  of  Fentura
Bancorp,  Inc.,  which report is included in the 2000 Annual Report on Form 10-K
of Fentura Bancorp, Inc.




                                          GRANT THORNTON LLP

Southfield, Michigan
March 20, 2001