<PAGE>   1
                                                                    EXHIBIT 13.1


                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                              OR PLAN OF OPERATION


<PAGE>   2



ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
         AND RESULTS OF OPERATIONS

The following is a discussion of our financial condition and the financial
condition of our bank subsidiary, First Georgia Community Bank at December 31,
2000 and 1999 and the results of operations for the years then ended. The
purpose of this discussion is to focus on information about our financial
condition and results of operations that are not otherwise apparent from our
audited consolidated financial statements. Reference should be made to those
statements and the selected financial data presented elsewhere in this report
for an understanding of the following discussion and analysis.

FORWARD-LOOKING STATEMENTS

We may from time to time make written or oral forward-looking statements,
including statements contained in our filings with the Securities and Exchange
Commission and our reports to stockholders. Statements made in this report,
other than those concerning historical information, should be considered
forward-looking and subject to various risks and uncertainties. Forward-looking
statements are made based upon management's belief as well as assumptions made
by, and information currently available to, management pursuant to "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995. Our actual
results may differ materially from the results anticipated in forward-looking
statements due to a variety of factors, including governmental monetary and
fiscal policies, deposit levels, loan demand, loan collateral values, securities
portfolio values, interest rate risk management, the effects of competition in
the banking business from other commercial banks, thrifts, mortgage banking
firms, consumer finance companies, credit unions, securities brokerage firms,
insurance companies, money market funds and other financial institutions
operating in our market area and elsewhere, including institutions operating
through the Internet, changes in governmental regulation relating to the banking
industry, including regulations relating to branching and acquisitions, failure
of assumptions underlying the establishment of reserves for loan losses,
including the value of collateral underlying delinquent loans and other factors.
We caution that these factors are not exclusive. We do not undertake to update
any forward-looking statement that may be made from time to time by us, or on
our behalf.

OVERVIEW

Our 2000 results were highlighted by the reporting of net income of $813,000 in
our third full year of operations and completely recouping operating losses
incurred through 1999. We once again had significant loan, deposit and
accumulated asset growth. This growth should provide a base for continued
profitability.


<PAGE>   3


FINANCIAL CONDITION AT DECEMBER 31, 2000 AND 1999

The following is a summary of our balance sheets for the years indicated:

<TABLE>
<CAPTION>
                                                                             December 31,
                                                                     2000                    1999
                                                                        (Dollars in Thousands)

<S>                                                                <C>                     <C>
Cash and due from banks                                            $   1,478               $   2,739
Federal funds sold                                                     7,090                   2,390
Securities                                                             8,282                   7,796
Loans, net                                                            63,034                  39,726
Loans held for sale                                                       --                      84
Premises and equipment                                                 2,163                   2,196
Other assets                                                           2,929                   2,403
                                                                   ---------               ---------

                                                                   $  84,976               $  57,334
                                                                   =========               =========

Total deposits                                                     $  69,678               $  48,186
Other borrowings                                                       6,307                   1,765
Other liabilities                                                        902                     286
Stockholders' equity                                                   8,089                   7,097
                                                                   ---------               ---------

                                                                   $  84,976               $  57,334
                                                                   =========               =========
</TABLE>

FINANCIAL CONDITION AT DECEMBER 31, 2000 AND 1999

As of December 31, 2000, we had total assets of $85.0 million, an increase of
48% over total assets as of December 31, 1999. Total interest-earning assets
were $79.3 million at December 31, 2000 or 93% of total assets as compared to
88% of total assets at December 31, 1999. Our primary interest-earning assets at
December 31, 2000 were loans, which made up 81% of total interest-earning assets
as compared to 80% at December 31, 1999. Our loan to deposit ratio was 92% at
December 31, 2000 as compared to 84% at December 31, 1999. Deposit growth of
$21.5 million and increased Federal Home Loan Bank borrowings of $4.5 million
have been used primarily to fund loan growth of $23.6 million. The remainder of
funds provided by these financing activities, coupled with a decrease in cash
reserves of $1.3 million, was invested primarily in federal funds sold.

Our securities portfolio, consisting of U.S. Agency securities and restricted
equity securities, amounted to $8.3 million at December 31, 2000. Unrealized
losses on securities amounted to $52,000 at December 31, 2000 as compared to
$323,000 at December 31, 1999. Management has not specifically identified any
securities for sale in future periods that, if so designated, would require a
charge to operations if the market value would not be reasonably expected to
recover prior to the time of sale.

We have 84% of our loan portfolio collateralized by real estate located in our
primary market area of Butts County, Georgia and surrounding counties. Our real
estate mortgage portfolio consists of loans collateralized by one to four-family
residential properties (21%), construction loans to build one to four-family
residential properties (26%), and nonresidential properties


<PAGE>   4


consisting primarily of small business commercial properties (53%). We generally
require that loans collateralized by real estate not exceed the collateral
values by the following percentages for each type of real estate loan as
follows.

<TABLE>
<CAPTION>
              <S>                                                                                           <C>
              One to four-family residential properties                                                     90%
              Construction loans on one to four-family residential properties                               90%
              Nonresidential property                                                                       85%

</TABLE>

The remaining 16% of our loan portfolio consists of commercial, consumer, and
other loans. We require collateral commensurate with the repayment ability and
creditworthiness of the borrower.

The specific economic and credit risks associated with our loan portfolio,
especially the real estate portfolio, include, but are not limited to, a general
downturn in the economy which could affect unemployment rates in our market
area, general real estate market deterioration, interest rate fluctuations,
deteriorated or non-existing collateral, title defects, inaccurate appraisals,
financial deterioration of borrowers, fraud, and any violation of banking
protection laws. Construction lending can also present other specific risks to
the lender such as whether developers can find builders to buy lots for home
construction, whether the builders can obtain financing for the construction,
whether the builders can sell the home to a buyer, and whether the buyer can
obtain permanent financing. Currently, real estate values and employment trends
in our market area are stable with no indications of a significant downturn in
the local economy.

We attempt to reduce these economic and credit risks not only by adhering to
loan to value guidelines, but also by investigating the creditworthiness of the
borrower and monitoring the borrower's financial position. Also, we establish
and periodically review our lending policies and procedures. State banking
regulations limit exposure by prohibiting secured loan relationships that exceed
25% of the Bank's statutory capital and unsecured loan relationships that exceed
15% of the Bank's statutory capital.

LIQUIDITY AND CAPITAL RESOURCES

The purpose of liquidity management is to ensure that there are sufficient cash
flows to satisfy demands for credit, deposit withdrawals, and our other needs.
Traditional sources of liquidity include asset maturities and growth in core
deposits. A company may achieve its desired liquidity objectives from the
management of assets and liabilities and through funds provided by operations.
Funds invested in short-term marketable instruments and the continuous maturing
of other earning assets are sources of liquidity from the asset perspective. The
liability base provides sources of liquidity through deposit growth, the
maturity structure of liabilities, and accessibility to market sources of funds.

Scheduled loan payments are a relatively stable source of funds, but loan
payoffs and deposit flows fluctuate significantly, being influenced by interest
rates and general economic conditions and competition. We attempt to price
deposits to meet asset/liability objectives consistent with local market
conditions.


<PAGE>   5


Our liquidity and capital resources are monitored on a periodic basis by
management, State and Federal regulatory authorities. As determined under
guidelines established by regulatory authorities and internal policy, our
liquidity was considered satisfactory.

At December 31, 2000, we had loan commitments outstanding of $11.4 million.
Because these commitments generally have fixed expiration dates and many will
expire without being drawn upon, the total commitment amounts do not necessarily
represent future cash requirements. If needed, we have the ability on a
short-term basis to borrow and purchase federal funds from other financial
institutions. At December 31, 2000, we had arrangements with three commercial
banks for short-term advances of $5,000,000.

At December 31, 2000, our capital ratios were considered adequate based on
regulatory minimum capital requirements. Our stockholders' equity increased due
to net income in 2000 of $813,000. Our stockholders' equity also increased due
to an increase in the fair value of securities available-for-sale, net of tax,
in the amount of $179,000. For regulatory purposes, the net unrealized losses on
securities available-for-sale are excluded in the computation of the capital
ratios.

In the future, the primary source of funds available to First Georgia Community
Corp. will be the payment of dividends by the Bank. Banking regulations limit
the amount of the dividends that may be paid without prior approval of the
Bank's regulatory agency. Currently, the Bank could pay $397,000 in dividends
without regulatory approval.

The minimum capital requirements to be considered well capitalized under prompt
corrective action provisions and the actual capital ratios for First Georgia
Community Corp. and the Bank as of December 31, 2000 are as follows:

<TABLE>
<CAPTION>
                                                                                       Actual
                                                                  ------------------------------------------------
                                                                                                       Regulatory
                                                                  Consolidated          Bank          Requirements
                                                                  ------------          ----          ------------
     <S>                                                          <C>                   <C>            <C>
     Leverage capital ratio                                           10.29%             9.14%            5.00%
     Risk-based capital ratios:
        Core capital                                                  11.58             10.28             6.00
        Total capital                                                 12.83             11.54            10.00
</TABLE>

At December 31, 2000, we had no material commitments for capital expenditures.

These ratios may decline as asset growth continues, but are expected to exceed
the regulatory minimum requirements. Anticipated future earnings will assist us
in keeping these ratios at satisfactory levels.

We believe that our liquidity and capital resources are adequate and will meet
our foreseeable short and long-term needs. We anticipate that we will have
sufficient funds available to meet current loan commitments and to fund or
refinance, on a timely basis, our other material commitments and liabilities.


<PAGE>   6


Management is not aware of any known trends, events or uncertainties, other than
those discussed above, that will have or that are reasonably likely to have a
material effect on our liquidity, capital resources or operations. Management is
also not aware of any current recommendations by the regulatory authorities
that, if they were implemented, would have such an effect.

Effects of Inflation

The impact of inflation on banks differs from its impact on non-financial
institutions. Banks, as financial intermediaries, have assets that are primarily
monetary in nature and that tend to fluctuate in concert with inflation. A bank
can reduce the impact of inflation if it can manage its rate sensitivity gap.
This gap represents the difference between rate sensitive assets and rate
sensitive liabilities. We, through our asset/liability committee, attempt to
structure the assets and liabilities and manage the rate sensitivity gap,
thereby seeking to minimize the potential effects of inflation. For information
on the management of our interest rate sensitive assets and liabilities, see
"Asset/Liability Management."

RESULTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999

The following is a summary of our operations for the years indicated.

<TABLE>
<CAPTION>
                                                                   Years Ended December 31,
                                                                   2000                 1999
                                                                     (Dollars in Thousands)

<S>                                                              <C>                   <C>
Interest income                                                  $ 6,141               $ 3,614

Interest expense                                                   3,111                 1,669
                                                                 -------               -------

Net interest income                                                3,030                 1,945

Provision for loan losses                                            336                   197

Other income                                                         448                   271

Other expenses                                                     2,091                 1,580
                                                                 -------               -------

Pretax income                                                      1,051                   439

Income taxes                                                         238                    --
                                                                 -------               -------

Net income                                                       $   813               $   439
                                                                 =======               =======
</TABLE>


<PAGE>   7


Net Interest Income

Our results of operations are determined by our ability to manage interest
income and expense effectively, to minimize loan and investment losses, to
generate non-interest income, and to control operating expenses. Because
interest rates are determined by market forces and economic conditions beyond
our control, our ability to generate net interest income depends on our ability
to obtain an adequate net interest spread between the rate we pay on
interest-bearing liabilities and the rate we earn on interest-earning assets.

Our net yield on average interest-earning assets was 4.78% in 2000 as compared
to 4.60% in 1999. Average loans increased by $19.8 million which accounted for
the majority of a $21.1 million increase in total average interest-earning
assets. Average interest-bearing liabilities increased by $20.1 million with
average interest-bearing demand and time deposits accounting for the vast
majority of this increase. The rate earned on average interest-earning assets
increased to 9.69% in 2000 from 8.54% in 1999. The rate paid on average
interest-bearing liabilities increased to 5.76% in 2000 from 4.93% in 1999.

Provision for Loan Losses

The provision for loan losses was $336,000 in 2000 as compared to $197,000 in
1999. The amounts provided were due primarily to the growth of the portfolio and
to our assessment of the inherent risk in the portfolio. Based upon our
evaluation of the loan portfolio, we believe the allowance for loan losses to be
adequate to absorb possible losses on existing loans that may become
uncollectible. This evaluation considers past due and classified loans,
historical experience, underlying collateral values, and current economic
conditions that may affect the borrower's ability to repay. As of December 31,
2000, we had total nonperforming loans and assets of $68,000 as compared to none
at December 31,1999. The allowance for loan losses as a percentage of total
loans at December 31, 2000 and 1999 was 1.51% and 1.54%, respectively.

Other Income

Other income consists of service charges on deposit accounts and other
miscellaneous revenues and fees. Other operating income was $448,000 in 2000 as
compared to $271,000 in 1999, an increase of $177,000. The increase is due
primarily to a $78,000 increase in service charges on deposit accounts related
to our deposit growth and an increase in the recognition of income of $68,000
related to the increase in the cash surrender value of life insurance policies.

Other Expenses

Other expenses were $2,091,000 in 2000 as compared to $1,580,000 in 1999, an
increase of $511,000. Salaries and employee benefits increased by $314,000 due
to an increase in the number of employees to 21 at December 31, 2000 from 19 at
December 31,1999, increased deferred compensation expense of $42,000 and other
annual salary increases. Equipment and occupancy expenses increased by $20,000
due primarily to increased equipment depreciation and maintenance costs of
$18,000. Other operating expenses increased by $186,000 due primarily to
increased data/ATM processing expenses of $45,000, increased


<PAGE>   8


legal and professional expenses of $19,000 and other miscellaneous expenses of
$115,000 associated with the growth of the Bank.

Income Tax

Income tax expense in 2000 was $238,000 or 23% of pretax income. This is less
than the Federal statutory rate of 34% due to the recognition of $84,000 of
deferred tax assets previously accorded a valuation allowance. We reported no
income tax expense in 1999 due to accumulated deficits incurred through December
31, 1999.

Asset/Liability Management

Our objective is to manage assets and liabilities to provide a satisfactory,
consistent level of profitability within the framework of established cash,
loan, investment, borrowing, and capital policies. Specific officers are charged
with the responsibility for monitoring policies and procedures that are designed
to ensure acceptable composition of the asset/liability mix. Management's
overall philosophy is to support asset growth primarily through growth of core
deposits of all categories made by local individuals, partnerships, and
corporations.

Our asset/liability mix is monitored on a regular basis with a report reflecting
the interest rate-sensitive assets and interest rate-sensitive liabilities being
prepared and presented to the Bank's Board of Directors on a monthly basis. The
objective of this policy is to monitor interest rate-sensitive assets and
liabilities so as to minimize the impact of substantial movements in interest
rates on earnings. An asset or liability is considered to be interest
rate-sensitive if it will reprice or mature within the time period analyzed,
usually one year or less. The interest rate-sensitivity gap is the difference
between the interest-earning assets and interest-bearing liabilities scheduled
to mature or reprice within such time period. A gap is considered positive when
the amount of interest rate-sensitive assets exceeds the amount of interest
rate-sensitive liabilities. A gap is considered negative when the amount of
interest rate-sensitive liabilities exceeds the interest rate-sensitive assets.
During a period of rising interest rates, a negative gap would tend to affect
net interest income adversely, while a positive gap would tend to result in an
increase in net interest income. Conversely, during a period of falling interest
rates, a negative gap would tend to result in an increase in net interest
income, while a positive gap would tend to affect net interest income adversely.
If our assets and liabilities were equally flexible and moved concurrently, the
impact of any increase or decrease in interest rates on net interest income
would be minimal.

A simple interest rate "gap" analysis by itself may not be an accurate indicator
of how net interest income will be affected by changes in interest rates.
Accordingly, we also evaluate how the repayment of particular assets and
liabilities is impacted by changes in interest rates. Income associated with
interest-earning assets and costs associated with interest-bearing liabilities
may not be affected uniformly by changes in interest rates. In addition, the
magnitude and duration of changes in interest rates may have a significant
impact on net interest income. For example, although certain assets and
liabilities may have similar maturities or periods of repricing, they may react
in different degrees to changes in market interest rates. Interest rates on
certain types of assets and liabilities fluctuate in advance of changes in
general market rates, while interest rates on other types may lag behind changes
in general market rates. In addition, certain assets, such as adjustable rate
mortgage loans, have features (generally referred to as "interest rate caps and
floors") that limit changes in


<PAGE>   9


interest rates. Prepayment and early withdrawal levels also could deviate
significantly from those assumed in calculating the interest rate gap. The
ability of many borrowers to service their debts also may decrease during
periods of rising interest rates.

Changes in interest rates also affect our liquidity position. We currently price
deposits in response to market rates and it is management's intention to
continue this policy. If deposits are not priced in response to market rates, a
loss of deposits could occur that would negatively affect our liquidity
position.

At December 31, 2000, our cumulative one year interest rate-sensitivity gap
ratio was 70%. Our targeted ratio is 80% to 120% in this time horizon. This
indicates that our interest-bearing liabilities will reprice during this period
at a rate faster than our interest-earning assets. We are currently not within
our targeted parameters due primarily to 88% of certificates of deposit
repricing within a one year time frame as opposed to 51% of loan and securities
repricing within a one year time frame. We have approximately $10.4 million of
interest-bearing demand deposits that we consider to be core deposits, and
therefore not interest rate sensitive. Adjusting for these deposits, our
cumulative one year interest rate-sensitive gap ratio would be 84%. We believe
that competitive market rates are being paid for certificates of deposit, and as
long as the rates remain competitive, liquidity should not be adversely
affected.

The following table sets forth the distribution of the repricing of our
interest-earning assets and interest-bearing liabilities as of December 31,
2000, the interest rate- sensitivity gap, the cumulative interest
rate-sensitivity gap, the interest rate-sensitivity gap ratio and the cumulative
interest rate-sensitivity gap ratio. The table also sets forth the time periods
in which interest-earning assets and interest-bearing liabilities will mature or
may reprice in accordance with their contractual terms. However, the table does
not necessarily indicate the impact of general interest rate movements on the
net interest margin as the repricing of various categories of assets and
liabilities is subject to competitive pressures and the needs of our customers.
In addition, various assets and liabilities indicated as repricing within the
same period may in fact, reprice at different times within such period and at
different rates.


<PAGE>   10


<TABLE>
<CAPTION>
                                                                              After           After
                                                                              Three            One
                                                                              Months         Year but
                                                               Within          but            Within        After
                                                                Three         Within           Five         Five
                                                                Months       One Year         Years         Years         Total
                                                                                     (Dollars in Thousands)

<S>                                                           <C>           <C>             <C>           <C>           <C>
Interest-earning assets:
     Federal funds sold                                       $   7,090     $       --      $      --     $      --     $   7,090
     Securities                                                     315             --          5,958         2,009         8,282
     Loans                                                       30,465          6,018         26,801           718        64,002
                                                              ---------     ----------      ---------     ---------     ---------

                                                                 37,870          6,018         32,759         2,727        79,374
                                                              ---------     ----------      ---------     ---------     ---------

Interest-bearing liabilities:
     Interest-bearing demand
          deposits                                               18,937             --             --            --        18,937
     Savings                                                        815             --             --            --           815
     Certificates of deposit                                     12,772         25,434          5,301            --        43,507
     Other borrowings                                                 7          4,550          1,750            --         6,307
                                                              ---------     ----------      ---------     ---------     ---------

                                                                 32,531         29,984          7,051            --        69,566
                                                              ---------     ----------      ---------     ---------     ---------

Interest rate sensitivity
     gap                                                      $   5,339     $  (23,966)     $  25,708     $   2,727     $   9,808
                                                              =========     ==========      =========     =========     =========
Cumulative interest rate
     sensitivity gap                                          $   5,339     $  (18,627)     $   7,081     $   9,808
                                                              =========     ==========      =========     =========
Interest rate sensitivity
     gap ratio                                                     1.16            .20           4.65            --
                                                              =========     ==========      =========     =========
Cumulative interest rate
     sensitivity gap ratio                                         1.16            .70           1.10          1.14
                                                              =========     ==========      =========     =========
</TABLE>


<PAGE>   11


               SELECTED FINANCIAL INFORMATION AND STATISTICAL DATA

The tables and schedules on the following pages set forth certain significant
financial information and statistical data with respect to:

         -        DISTRIBUTION of our assets, liabilities and stockholders'
                  equity, and the interest rates we experience;

         -        OUR investment portfolio;

         -        OUR loan portfolio, including types of loans, maturities, and
                  sensitivities of loans to changes in interest rates and
                  information on nonperforming loans;

         -        SUMMARY of our loan loss experience and allowance for loan
                  losses;

         -        TYPES of deposits; and

         -        RETURN on equity and assets.



<PAGE>   12


                    DISTRIBUTION OF ASSETS, LIABILITIES, AND
                              STOCKHOLDERS' EQUITY:
                    INTEREST RATES AND INTEREST DIFFERENTIALS

AVERAGE BALANCES

The condensed average balance sheet for the years indicated is presented
below.(1)

<TABLE>
<CAPTION>

                                                                       Years Ended December 31,
                                                                    2000                      1999
                                                                        (Dollars in Thousands)
                   ASSETS

<S>                                                              <C>                       <C>
Cash and due from banks                                          $    1,735                $    1,852
Taxable securities                                                    8,154                     7,576
Securities valuation account                                           (289)                     (143)
Federal funds sold                                                    3,917                     3,251
Loans (2)                                                            51,280                    31,464
Allowance for loan losses                                              (771)                     (528)
Other assets                                                          4,798                     2,933
                                                                 ----------                ----------
                                                                 $   68,824                $   46,405
                                                                 ==========                ==========

Total interest-earning assets                                    $   63,351                $   42,291
                                                                 ==========                ==========

     LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits:
     Noninterest-bearing demand                                  $    6,925                $    5,379
     Interest-bearing demand                                         15,318                    12,691
     Savings                                                            886                       922
     Time                                                            33,287                    19,548
                                                                 ----------                ----------
              Total deposits                                         56,416                    38,540

Other borrowings                                                      4,487                       693
Other liabilities                                                       401                       258
                                                                 ----------                ----------
              Total liabilities                                      61,304                    39,491
                                                                 ----------                ----------
Stockholders' equity                                                  7,520                     6,914
                                                                 ----------                ----------
                                                                 $   68,824                $   46,405
                                                                 ==========                ==========

     Total interest-bearing liabilities                          $   53,978                $   33,854
                                                                 ==========                ==========
</TABLE>

         (1)      For each category, average balances were determined using the
                  daily average balances during the year.

         (2)      Nonaccrual loans included in average loans for 2000 was
                  $20,000. There were no nonaccrual loans included in average
                  loans on 1999.



<PAGE>   13


INTEREST INCOME AND INTEREST EXPENSE

The following tables set forth the amount of our interest income and interest
expense for each category of interest-earning assets and interest-bearing
liabilities and the average interest rate for total interest-earning assets and
total interest-bearing liabilities, net interest spread and net yield on average
interest-earning assets.

<TABLE>
<CAPTION>
                                                                  Years Ended December 31,
                                                             2000                          1999
                                                                     Average                        Average
                                                   Interest           Rate        Interest            Rate
                                                                     (Dollars in Thousands)

<S>                                                <C>               <C>          <C>               <C>
INTEREST INCOME:
     Interest and fees on loans (1)                $  5,408           10.55%      $  3,015            9.58%
     Interest on taxable securities                     480            5.89            436            5.76
     Interest on Federal funds sold                     253            6.45            163            5.03
                                                   --------                       --------
     Total interest income                            6,141            9.69          3,614            8.54
                                                   --------                       --------

INTEREST EXPENSE:
     Interest on interest-bearing
       demand deposits                                  720            4.70            535            4.21
     Interest on savings deposits                        24            2.74             24            2.70
     Interest on time deposits                        2,086            6.27          1,066            5.45
     Interest on other borrowings                       281            6.27             44            6.32
                                                   --------                       --------
     Total interest expense                           3,111            5.76          1,669            4.93
                                                   --------                       --------

NET INTEREST INCOME                                $  3,030                       $  1,945
                                                   ========                       ========

     Net interest spread                                               3.93%                          3.61%
                                                                     ======                         ======
     Net yield on average interest-earning assets                      4.78%                          4.60%
                                                                     ======                         ======
</TABLE>

(1)      Interest and fees on loans includes $460,000 and $310,000 of loan fee
         income for the years ended December 31, 2000 and 1999, respectively.
         There was no interest income recognized on nonaccrual loans during 2000
         or 1999.


<PAGE>   14


RATE AND VOLUME ANALYSIS

The following table describes the extent to which changes in interest rates and
changes in volume of interest-earning assets and interest-bearing liabilities
have affected our interest income and expense during the year indicated. For
each category of interest-earning assets and interest-bearing liabilities,
information is provided on changes attributable to (1) change in volume (change
in volume multiplied by old rate); (2) change in rate (change in rate multiplied
by old volume); and (3) a combination of change in rate and change in volume.
The changes in interest income and interest expense attributable to both volume
and rate have been allocated proportionately on a consistent basis to the change
due to volume and the change due to rate.

<TABLE>
<CAPTION>
                                                                           Years Ended December 31,
                                                                               2000 vs. 1999
                                                                               Changes Due To:

                                                                     Rate          Volume           Net
                                                                           (Dollars in Thousands)
<S>                                                                 <C>           <C>             <C>
Increase (decrease) in:
     Income from interest-earning assets:
     Interest and fees on loans                                     $   330       $   2,063       $  2,393
     Interest on taxable securities                                      10              34             44
     Interest on Federal funds sold                                      52              38             90
                                                                    -------       ---------       --------
              Total interest income                                     392           2,135          2,527
                                                                    -------       ---------       --------

     Expense from interest-bearing liabilities:
     Interest on interest-bearing
              demand deposits                                            66             119            185
     Interest on savings deposits                                         1              (1)            --
     Interest on time deposits                                          179             841          1,020
     Interest on other borrowings                                        (1)            238            237
                                                                    -------       ---------       --------
              Total interest expense                                    245           1,197          1,442
                                                                    -------       ---------       --------

              Net interest income                                   $   147       $     938       $  1,085
                                                                    =======       =========       ========
</TABLE>




<PAGE>   15



                              INVESTMENT PORTFOLIO

TYPES OF INVESTMENTS

The carrying amounts of securities at the dates indicated, which are all
classified as available-for-sale, are summarized as follows:

<TABLE>
<CAPTION>
                                                                           December 31,
                                                                   2000                     1999
                                                                       (Dollars in Thousands)

<S>                                                              <C>                       <C>
U.S. Government agencies                                         $  7,449                  $  7,687
Municipal securities                                                  518                        --
Restricted equity securities                                          315                       109
                                                                 --------                  --------
                                                                 $  8,282                  $  7,796
                                                                 ========                  ========
</TABLE>

MATURITIES

The amounts of debt securities, including the weighted average yield in each
category as of December 31, 2000 are shown in the following table according to
contractual maturity classifications (1) one year or less, (2) after one through
five years, (3) after five through ten years and (4) after ten years. Equity
securities are not included in the table because they have no contractual
maturity.

<TABLE>
<CAPTION>
                                                                             After one                       After five
                                         One year or less               through five years               through ten years
                                      Amount       Yield (1)           Amount       Yield (1)           Amount       Yield (1)
<S>                                  <C>           <C>               <C>            <C>               <C>            <C>
U.S. Government agencies             $     --          -%            $    5,957        5.80%          $    1,492        6.33%
Municipals                                 --          --                    --          --                   --          --
                                     --------                        ----------                       ----------
                                     $     --          --            $    5,957        5.80           $    1,492        6.33
                                     ========                        ==========                       ==========
</TABLE>


<TABLE>
<CAPTION>
                                              After ten years                       Total
                                          Amount          Yield (1)         Amount         Yield (1)
<S>                                     <C>               <S>              <C>             <C>
U.S. Government agencies                $      --              --%         $  7,449            5.91%
Municipals                                    518            5.05               518            5.05
                                        ---------                          --------
                                        $     518            5.05          $  7,967            5.52
                                        =========                          ========
</TABLE>

(1)      The weighted average yields were computed using coupon interest, adding
         discount accretion or subtracting premium amortization, as appropriate,
         on a ratable basis over the life of each security.



<PAGE>   16


                                 LOAN PORTFOLIO

TYPES OF LOANS

The amounts of loans outstanding at the indicated dates are shown in the
following table according to the type of loan.

<TABLE>
<CAPTION>
                                                                             December 31,
                                                                    2000                      1999
                                                                       (Dollars in Thousands)

<S>                                                              <C>                       <C>
Commercial                                                       $    5,983                $    3,866
Real estate-construction                                             14,022                    16,555
Real estate-mortgage                                                 39,959                    17,211
Consumer installment loans and other                                  4,038                     2,714
                                                                 ----------                ----------
                                                                     64,002                    40,346
Less allowance for loan losses                                         (968)                     (620)
                                                                 ----------                ----------
              Net loans                                          $   63,034                $   39,726
                                                                 ==========                ==========
</TABLE>

MATURITIES AND SENSITIVITIES OF LOANS TO CHANGES IN INTEREST RATES

Total loans as of December 31, 2000 are shown in the following table according
to contractual maturity classifications (1) one year or less, (2) after one
through five years, and (3) after five years.


<TABLE>
<CAPTION>
                                                                     (Dollars in Thousands)

<S>                                                                  <C>
Commercial
     One year or less                                                      $     382
     After one through five years                                              4,974
     After five years                                                            627
                                                                           ---------
                                                                               5,983
                                                                           ---------

Construction
     One year or less                                                      $  12,503
     After one through five years                                              1,519
     After five years                                                             --
                                                                           ---------
                                                                              14,022
                                                                           ---------

Other
     One year or less                                                      $  22,697
     After one through five years                                             19,571
     After five years                                                          1,729
                                                                           ---------
                                                                              43,997
                                                                           ---------


                                                                           $  64,002
                                                                           =========
</TABLE>


<PAGE>   17



The following table summarizes loans at December 31, 2000 with the due dates
after one year that have predetermined and floating or adjustable interest
rates.

<TABLE>
<CAPTION>

                                                                                       (Dollars in Thousands)

          <S>                                                                          <C>
          Predetermined interest rates                                                        $  26,046
          Floating or adjustable interest rates                                                   2,374
                                                                                              ---------
                                                                                              $  28,420
                                                                                              =========
</TABLE>

RISK ELEMENTS

Information with respect to nonaccrual, past due, restructured and other problem
loans at December 31, 2000 and 1999 is as follows:

<TABLE>
<CAPTION>
                                                                                          December 31,
                                                                                     2000               1999
                                                                                     ----               ----
                                                                                      (Dollars in Thousands)

<S>                                                                                  <C>                <C>
Nonaccrual loans                                                                     $ 12               $  0
Loans contractually past due ninety
     days or more as to interest or
     principal payments and still accruing                                              0                  0
Restructured loans                                                                      0                  0
Loans, now current about which there are
     serious doubts as to the ability of the
     borrower to comply with loan repayment terms                                       0                  0
Interest income that would have been recorded
     on nonaccrual and restructured loans under
     original terms                                                                     2                  0
Interest income that was recorded on
     nonaccrual and restructured loans                                                  0                  0
</TABLE>

It is our policy to discontinue the accrual of interest income when, in the
opinion of management, collection of interest becomes doubtful. This status is
accorded interest when (1) there is a significant deterioration in the financial
condition of the borrower and full repayment of principal and interest is not
expected and (2) the principal or interest is more than ninety days past due,
unless the loan is both well-secured and in the process of collection.

Loans classified for regulatory purposes as loss, doubtful, substandard, or
special mention that have not been included in the table above do not represent
or result from trends or uncertainties that management reasonably expects will
materially impact future operating results, liquidity, or capital resources.
These classified loans do not represent material credits about which management
is aware of any information that causes management to have serious doubts as to
the ability of such borrowers to comply with the loan repayment terms.



<PAGE>   18


                         SUMMARY OF LOAN LOSS EXPERIENCE

The following table summarizes average loan balances for the year determined
using the daily average balances during the period of banking operations;
changes in the allowance for loan losses arising from loans charged off;
recoveries on loans previously charged off; additions to the allowance which
have been charged to operating expense; and the ratio of net charge-offs during
the year to average loans.

<TABLE>
<CAPTION>
                                                                                  Years Ended December 31,
                                                                              2000                       1999
                                                                                  (Dollars in Thousands)

<S>                                                                        <C>                        <C>
Average amount of loans outstanding                                        $   51,280                 $   31,464
                                                                           ==========                 ==========

Balance of allowance for loan losses
     at beginning of year                                                  $      620                 $      434
                                                                           ----------                 ----------

Loans charged off
     Commercial                                                                    --                         --
     Real estate mortgage                                                          --                         --
     Installment                                                                    1                         13
                                                                           ----------                 ----------
                                                                                    1                         13
                                                                           ----------                 ----------

Loans recovered
     Commercial                                                                    --                         --
     Real estate mortgage                                                          --                         --
     Installment                                                                   13                          2
                                                                           ----------                 ----------
                                                                                   13                          2
                                                                           ----------                 ----------

Net charge-offs (recoveries)                                                      (12)                        11
                                                                           ----------                 ----------

Additions to allowance charged to operating
     expense during year                                                          336                        197
                                                                           ----------                 ----------

Balance of allowance for loan losses
     at end of year                                                        $      968                 $      620
                                                                           ==========                 ==========

Ratio of net loans charged off (recovered)
during the year to average loans outstanding                                     (.02)%                     0.03%
                                                                           ==========                 ==========
</TABLE>

ALLOWANCE FOR LOAN LOSSES

The allowance for loan losses is maintained at a level that is deemed
appropriate by management to adequately cover all known and inherent risks in
the loan portfolio. Our evaluation of the loan portfolio includes a periodic
review of loan loss experience, current economic conditions that may affect the
borrower's ability to pay and the underlying collateral value of the loans.



<PAGE>   19


As of December 31, 2000 and 1999, we had made no allocations of our allowance
for loan losses to specific categories of loans. Based on management's best
estimate, the allocation of the allowance for loan losses to types of loans, as
of the indicated dates, is as follows:

<TABLE>
<CAPTION>
                                                        December 31, 2000                      December 31, 1999
                                                                Percent of loans in                 Percent of loans in
                                                                   each category                       each category
                                                  Amount           to total loans       Amount         to total loans
                                                                         (Dollars in Thousands)

<S>                                               <C>           <C>                    <C>         <C>
Commercial                                        $  194                  10%          $  124                 9%
Real estate - construction                           145                  22               93                41
Real estate - mortgage                               532                  62              341                43
Consumer installment
     loans and other                                  97                   6               62                 7
                                                  ------              ------           ------             -----
                                                  $  968                 100%          $  620               100%
                                                  ======              ======           ======             =====
</TABLE>



<PAGE>   20


                                    DEPOSITS

Average amount of deposits and average rates paid thereon, classified as to
noninterest-bearing demand deposits, interest-bearing demand deposits, savings
deposits, and time deposits is presented below. (1)

<TABLE>
<CAPTION>
                                                                      Years Ended December 31,
                                                              2000                              1999
                                                    Amount            Percent         Amount            Percent
                                                                       (Dollars in Thousands)

<S>                                               <C>                 <C>            <C>                <C>
Noninterest-bearing demand deposits               $   6,925              --%         $   5,379              --%
Interest-bearing demand deposits                     15,318            4.70             12,691            4.21
Savings deposits                                        886            2.74                922            2.70
Time deposits                                        33,287            6.27             19,548            5.45
                                                  ---------                          ---------
                                                  $  56,416                          $  38,540
                                                  =========                          =========
</TABLE>

(1)       Average balances were determined using the daily average balances.

The amounts of time certificates of deposit issued in amounts of $100,000 or
more as of December 31, 2000 are shown below by category, which is based on time
remaining until maturity of (1) three months or less, (2) over three through six
months, (3) over six through twelve months, and (4) over twelve months.

<TABLE>
<CAPTION>
                                                                               (Dollars in Thousands)


     <S>                                                                              <C>
     Three months or less                                                             $  4,947
     Over three months through six months                                                4,455
     Over six through twelve months                                                      4,554
     Over twelve months                                                                  1,033
                                                                                      --------
              Total                                                                   $ 14,989
                                                                                      ========
</TABLE>


                    RETURN ON ASSETS AND STOCKHOLDERS' EQUITY

The following rate of return information for the year indicated is presented
below.

<TABLE>
<CAPTION>
                                                                     Years Ended December 31,
                                                                    2000                 1999

     <S>                                                            <C>                  <C>
     Return on assets (1)                                            1.18%                0.95%
     Return on equity (2)                                           10.81                 6.35
     Dividend payout ratio (3)                                         --                   --
     Equity to assets ratio (4)                                     10.93                14.90
</TABLE>

(1)      Net income divided by average total assets.

(2)      Net income divided by average equity.

(3)      Dividends declared per share of common stock divided by net income per
         share.

(4)      Average equity divided by average total assets.