SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                   For the Fiscal Year Ended December 31, 1998

                          Commission File No. 333-19201

                          THE COMMERCIAL BANCORP, INC.
                 (Name of small business issuer in its charter)

       A Florida Corporation (IRS Employer Identification No. 59-3396236)
                                258 N. Nova Road
                           Ormond Beach, Florida 32174
                                 (904) 672-3003

                 Securities Registered Pursuant to Section 12(b)
                    of the Securities Exchange Act of 1934:

                                      NONE
                                      ----

                 Securities Registered Pursuant to Section 12(g)
                    of the Securities Exchange Act of 1934:

                                      NONE
                                      ----

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

Check if disclosure of delinquent  filers pursuant to Item 405 of Regulation S-B
is not  contained  in this  form,  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-KSB or any  amendment to
this Form 10-KSB. [ ]

Revenues for the  fiscal  year  ended  December  31,  1998:  $ 1,041,053

The  aggregate  market  value  of the  common  stock of the  Registrant  held by
nonaffiliates  of the  Registrant  (338,176  shares) on  February  28,  1998 was
approximately  $3,381,760.  As of such date, no organized trading market existed
for the common stock of the Registrant.  The aggregate market value was computed
by reference to recent trading activity of the common stock of the registrant at
$10.00 per share.  For the purposes of this  response,  directors,  officers and
holders  of 5% or more of the  Registrant's  common  stock  are  considered  the
affiliates of the Registrant at that date.

The  number  of shares  outstanding  of the  Registrant's  Common  Stock,  as of
February 28, 1999: 464,791 shares of $0.01 par value common stock.

                       DOCUMENTS INCORPORATED BY REFERENCE
                       -----------------------------------


         1.       Portions of the Company's 1998 Annual Report.  (Part II)

         2.       Portions of Proxy  Statement  for the 1999  Annual  Meeting of
                  Shareholders. (Part III)

                                        1

<PAGE>



                                TABLE OF CONTENTS

Consolidated--The Commercial Bancorp,  Inc. and Affiliates

         NOTE:  Certain  information  required by Form 10-KSB is incorporated by
reference from the 1998 Annual Report and 1999 Annual Meeting Proxy Statement as
indicated below.  Only that information  expressly  incorporated by reference is
deemed filed with the Commission.
<TABLE>
<CAPTION>

         PART I                                                                                             Page Number
                                                                                                            -----------
<S>               <C>                                                                                             <C>
         Item 1   Business.....................................................................                   3
         Item 2   Properties...................................................................                   8
         Item 3   Legal Proceedings............................................................                   8
         Item 4   Submission of Matters to a Vote of Security Holders..........................                   8


         PART II
         Item 5   Market for Common Equity and Related Stockholder Matters.....................                   9
         Item 6   Management's Discussion and Analysis of Financial Condition
                  and Results of Operations....................................................                   9(1)
         Item 7   Financial Statements and Supplementary Data..................................                   9(1)
         Item 8   Changes in and Dsagreements with Accountants on
                  Accounting and Financial Disclosure..........................................                   9


         PART III
         Item 9   Directors and Executive Officers of the Registrant...........................                   10(2)
         Item 10  Executive Compensation.......................................................                   10(2)
         Item 11  Security Ownership of Certain Beneficial Owners and Management...............                   10(2)
         Item 12  Certain Relationships and Related Transactions...............................                   10(2)
         Item 13  Exhibits, Financial Statement Schedules, and Reports on Form 8-K.............                   11
</TABLE>

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

         (1)      These items are  incorporated  by reference from the Company's
                  1998  Annual  Report  pursuant  to  instruction  E 2.  of Form
                  10-KSB.

         (2)      The  material  required  by  Items  9  through  11  is  hereby
                  incorporated by reference from the Company's  definitive proxy
                  statement pursuant to Instruction E 3. of Form 10-KSB.

                                        2

<PAGE>



                                     PART I

ITEM 1. - BUSINESS

Description

General

The Commercial  Bancorp,  Inc. ("TCB") is a bank holding company which owns 100%
of the issued and  outstanding  common stock of The  Commercial  Bank of Volusia
County,  Ormond Beach, Florida (the  "TCB-Volusia").  TCB was incorporated under
the laws of the State of Florida on August 15,  1996 to acquire  100  percent of
the shares to be issued by TCB-Volusia  during its  organizational  stage and to
enhance  the  Bank's  ability to serve its future  customers'  requirements  for
financial  services.  TCB provides  flexibility  for  expansion of the Company's
banking  business  through  acquisition  of  other  financial  institutions  and
provision  of  additional   banking-related   services  which  the   traditional
commercial bank may not provide under present laws.

TCB-Volusia is a  state-chartered  commercial bank, which opened for business on
October  14,  1997.  TCB-Volusia  offers a wide  range of  interest-bearing  and
noninterest-bearing accounts, including commercial and retail checking accounts,
negotiable  order  of  withdrawal  ("NOW")  accounts,   money  market  accounts,
individual  retirement  accounts,  regular  interest-bearing  statement  savings
accounts,  certificates of deposit,  commercial  loans,  real estate loans, home
equity loans and consumer/installment  loans. In addition,  TCB-Volusia provides
such consumer  services as U.S. Savings Bonds,  travelers  checks,  safe deposit
boxes, bank by mail services and direct deposit services.

Market Area

The primary service area for  TCB-Volusia  includes the city of Ormond Beach and
Ormond by the Sea, along with portion of the city of Holly Hill.  There is a lot
of  competition  among  financial  institutions  in  this  area.  There  are  20
commercial  banking  offices and 3 savings and loan  offices  within the primary
service  area of  TCB-Volusia.  Most of these  offices  are  branches of or are,
affiliated with major bank holding companies.

TCB-Volusia is in competition  with existing area financial  institutions  other
than commercial  banks and savings and loan  associations,  including  insurance
companies, consumer finance companies, brokerage houses, credit unions and other
business entities which have over the years,  engaged more and more in providing
services which have historically been traditional  banking services.  Due to the
growth of the Volusia County area in general and the Bank's primary service area
in particular,  it is anticipated  that competition will increase because of new
entrants to the market.

Investments

As of December 31, 1998,  federal funds sold comprised  approximately  19.6% and
securities available for sale comprised approximately 15.2% of TCB's assets. Net
loans  comprised  approximately  53.3% of TCB's assets at December 31, 1998. TCB
enters into Federal Funds transactions with its principal  correspondent  banks,
and acts as a seller of such funds.

Loan Portfolio

TCB-Volusia  engages  in a wide  range  of  lending  activities,  including  the
originating and purchasing of commercial,  consumer/installment  and real estate
loans.

Commercial  lending is directed  principally toward businesses whose demands for
funds fall within  TCB-Volusia's  legal  lending  limits and which are potential
deposit customers of TCB-Volusia.  This category of loans includes loans made to
individual,  partnership or corporate  borrowers,  and obtained for a variety of
business  purposes.  Particular  emphasis  is  placed  on  loans  to  small  and
medium-sized businesses.  TCB-Volusia's real estate loans consist of residential
and commercial first and second mortgage loans.



                                        3

<PAGE>



TCB-Volusia's   consumer  loans  consist   primarily  of  installment  loans  to
individuals for personal,  family and household purposes,  including  automobile
loans to individuals and  pre-approved  lines of credit.  This category of loans
also  includes  term loans  secured by second  mortgages  on the  residences  of
borrowers for a variety of purposes including home  improvements,  education and
other personal expenditures.

TCB-Volusia's  general policy is not to accrue interest on loans delinquent over
ninety days unless fully secured and in the process of collection. The policy is
that the accrued and unpaid  interest is  reversed  against  current  income and
thereafter interest is recognized only to the extent payments are received.  The
policy is that non-accrual loans are restored to accrual basis when interest and
principal  payments  are current and  prospects  for  recovery  are no longer in
doubt.

As of December 31, 1998,  TCB-Volusia had two loans totaling  approximately $1.2
million where known  information  about  possible  credit  problems of borrowers
causes  management to have serious doubts as to the ability of such borrowers to
comply with the present loan repayment  terms.  These loans have been classified
by  management  as doubtful  and a specific  reserve  allowance in the amount of
$600,000 has been  established  to offset  possible  future  losses.  See Item 6
"Management's  Discussion  And  Analysis &  Financial  Condition  And Results Of
Operations".

The  majority  of  TCB-Volusia's  loans are  secured  by real  estate in Volusia
County,  Florida,  where  TCB-Volusia  is  located.  Accordingly,  the  ultimate
collectibility of a substantial  portion of the loan portfolio is susceptible to
changes in market conditions in this County.

Loan Loss Reserves

In  determining  the  adequacy  of  TCB-Volusia's  allowance  for  loan  losses,
management  has  considered  that as of December 31, 1998,  75.1% of outstanding
loans are in the commercial loan category, including loans secured by commercial
real estate.  Commercial loans are generally  considered by management as having
greater risk than other  categories of loans in  TCB-Volusia's  loan  portfolio.
However,  the majority of these  commercial loans at December 31, 1998 were made
on a  secured  basis,  with  collateral  consisting  primarily  of real  estate,
accounts   receivable,   inventory,   assignment  of  mortgages  and  equipment.
Management  believes that the secured  condition of the preponderant  portion of
its commercial  loan portfolio  reduces any risk of loss  inherently  present in
commercial loans.

TCB-Volusia's  consumer loan portfolio at December 31, 1998 consisted  primarily
of lines of credit and installment loans secured by automobiles, boats and other
consumer goods. Management believes that the risk associated with these types of
loans has been adequately provided for in the loan loss reserve.

Residential real estate mortgage loans constitute 11.8% of outstanding  loans at
December 31, 1998.  Management considers these loans to have minimal risk due to
the fact  that  these  loans  represent  conventional  residential  real  estate
mortgages  where the  amount of the  original  loan does not  exceed  80% of the
appraisal value of the collateral.

TCB-Volusia's Board of Directors monitors the loan portfolio monthly in order to
enable it to evaluate the adequacy of the allowance for loan losses. In addition
to reviews by regulatory  agencies and TCB's certified public  accountants,  the
services of outside consultants have been engaged to assist in the evaluation of
credit  quality and loan  administration.  These  professionals  compliment  the
system implemented by TCB-Volusia which identifies  potential problem credits as
early as possible,  categorizes  the credits as to risk and includes a reporting
process to monitor the progress of the credits.

The  allowance  for loan  losses  represents  the  cumulative  total of  monthly
provisions  for loan losses and  specific  provisions  for impaired  loans.  The
allowance  for loan losses is  established  through a provision  for loan losses
charged to expense.  Loans are charged off against the allowance when management
believes the collectibility of principal is unlikely.  The monthly provision for
loan  losses is based on  management's  judgment,  after  considering  known and
inherent risks in the portfolio,  past loss experience of  TCB-Volusia,  adverse
situations  that may affect the borrower's  ability to repay,  assumed values of
the  underlying  collateral  securing  the loans,  the current  and  prospective
financial condition of the borrower, and the prevailing and anticipated economic
condition of the local market.




                                        4

<PAGE>



TCB-Volusia  maintains the allowance for loan losses at a level which management
believes is sufficient to absorb all estimated losses in the loan portfolio. The
allowance  for loan  losses is made up of two  primary  components:  (i) amounts
allocated to loans based on collateral type and (ii) amounts allocated for loans
reviewed on an individual basis in accordance with a credit risk grading system.

Deposits

TCB-Volusia  offers a wide  range of  interest-bearing  and  noninterest-bearing
accounts, including commercial and retail checking accounts, negotiable order of
withdrawal  ("NOW")  accounts,  money  market  accounts,  individual  retirement
accounts,  regular interest-bearing  statement savings accounts and certificates
of deposit with fixed rates and a range of maturity date options. The sources of
deposits are residents, businesses and employees of businesses within the Bank's
market area,  obtained through the personal  solicitation of the Bank's officers
and directors,  direct mail  solicitation  and  advertisements  published in the
local media.  TCB-Volusia  pays  competitive  interest rates on time and savings
deposits  up to  the  maximum  permitted  by  law or  regulation.  In  addition,
TCB-Volusia has implemented a service charge fee schedule competitive with other
financial  institutions  in the Bank's  market  area,  covering  such matters as
maintenance fees on checking accounts,  per item processing fees, returned check
charges and the like.

Correspondent Banking

TCB-Volusia purchases  correspondent services offered by larger banks, including
check  collections,  purchase or sale of Federal  Funds,  security  safekeeping,
investment  services,  coin and currency  supplies,  overline and liquidity loan
participations and sales of loans to or participations with correspondent banks.

TCB-Volusia  sells loan  participations  to correspondent  banks with respect to
loans which exceed the Bank's lending limit of approximately  $800,000.  For the
fiscal  year  ended  December  31,  1998,  TCB-Volusia  had not  sold  any  loan
participations.

Data Processing

TCB-Volusia  has a data  processing  servicing  agreement with Citrus & Chemical
Bank,  Bartow,  Florida.  This servicing  agreement  provides for TCB-Volusia to
receive a full range of data processing  services including an automated general
ledger, deposit accounting, commercial, real estate and installment lending data
processing,  central  information  file  ("CIF")  and ATM  processing.  The data
processing  servicing  agreement  provides for  TCB-Volusia to pay a monthly fee
based on the type, kind and volume of data processing services provided,  priced
at a stipulated rate schedule.

Employees

TCB-Volusia currently employs 10 full time persons, including 6 officers, and no
part time persons. TCB-Volusia will hire additional persons as needed.

Monetary Policies

The results of operations of TCB and TCB-Volusia are affected by credit policies
of monetary authorities, particularly the Federal Reserve Board. The instruments
of monetary  policy  employed by the Federal  Reserve  Board include open market
operations in U.S. Government securities, changes in the discount rate on member
bank borrowings,  changes in reserve  requirements  against member bank deposits
and limitations on interest rates which member banks may pay on time and savings
deposits.  In view of changing  conditions  in the  national  economy and in the
money  market,  as  well  as  the  effect  of  action  by  monetary  and  fiscal
authorities,  including the Federal  Reserve Board, no prediction can be made as
to possible future changes in interest rates,  deposit levels,  loan demand,  or
the business and earnings of TCB- Volusia.







                                        5

<PAGE>



Supervision and Regulation

TCB and  TCB-Volusia  operate  in a  highly  regulated  environment,  and  their
business  activities  are  governed by statute,  regulation  and  administrative
policies.  The business  activities of TCB and  TCB-Volusia  are supervised by a
number of federal regulatory agencies,  including the Federal Reserve Board, the
Florida Department of Banking and Finance ("Department") and the Federal Deposit
Insurance Corporation ("FDIC").

TCB is  regulated  by the Federal  Reserve  Board under the federal Bank Holding
Company  Act,  which  requires  every bank  holding  company to obtain the prior
approval of the  Federal  Reserve  Board  before  acquiring  more than 5% of the
voting shares of any bank or all or  substantially  all of the assets of a bank,
and before  merging or  consolidating  with another bank  holding  company.  The
Federal Reserve Board (pursuant to regulation and published  policy  statements)
has maintained  that a bank holding  company must serve as a source of financial
strength to its  subsidiary  banks.  In adhering  to the Federal  Reserve  Board
Policy,  TCB may be required to provide  financial support for a subsidiary bank
at a time when,  absent such Federal  Reserve Board policy,  TCB may not deem it
advisable to provide such assistance.

A bank holding  company is generally  prohibited  from acquiring  control of any
company  which is not a bank and from  engaging in any  business  other than the
business  of banking or  managing  and  controlling  banks.  However,  there are
certain activities which have been identified by the Federal Reserve Board to be
so  closely  related  to banking  as to be a proper  incident  thereto  and thus
permissible for bank holding companies.

As a state bank,  TCB-Volusia is subject to the  supervision of the  Department,
the FDIC and the Federal Reserve Board.  With respect to expansion,  TCB-Volusia
may establish branch offices anywhere within the State of Florida.  TCB- Volusia
is also subject to the Florida banking and usury laws  restricting the amount of
interest which it may charge in making loans or other  extensions of credit.  In
addition,  TCB-Volusia,  as a subsidiary of the TCB, is subject to  restrictions
under  federal  law in  dealing  with TCB and other  affiliates,  if any.  These
restrictions  apply to extensions of credit to an affiliate,  investments in the
securities of an affiliate and the purchase of assets from an affiliate.

Loans and  extensions  of credit by state  banks are  subject  to legal  lending
limitations.  Under  state  law,  a state  bank may  grant  unsecured  loans and
extensions  of  credit  in an amount  up to 15% of its  unimpaired  capital  and
surplus to any person. In addition,  a state bank may grant additional loans and
extensions of credit to the same person up to 10% of its unimpaired  capital and
surplus,  provided that the transactions are fully secured.  This 10% limitation
is separate from,  and in addition to, the 15%  limitation for unsecured  loans.
Loans and  extensions  of credit may exceed the  general  lending  limit if they
qualify under one of several exceptions.

Both TCB and TCB-Volusia are subject to regulatory capital  requirements imposed
by the Federal  Reserve  Board,  the FDIC and the  Department.  Both the Federal
Reserve Board and the FDIC have established  risk-based  capital  guidelines for
bank holding companies and banks which make regulatory capital requirements more
sensitive to differences in risk profiles of various banking organizations.  The
capital adequacy  guidelines  issued by the Federal Reserve Board are applied to
bank  holding  companies  on a  consolidated  basis with the banks  owned by the
holding  company.  The FDIC's risk capital  guidelines  apply  directly to state
banks  regardless  of whether they are a subsidiary  of a bank holding  company.
Both  agencies'  requirements  (which are  substantially  similar)  provide that
banking  organizations  must have  capital  equivalent  to 8% of  weighted  risk
assets. The risk weights assigned to assets are based primarily on credit risks.
Depending  upon the  riskiness of a particular  asset,  it is assigned to a risk
category. For example,  securities with an unconditional guarantee by the United
States government are assigned to the lowest risk category. A risk weight of 50%
is assigned to loans secured by  owner-occupied  one to four family  residential
mortgages.  The  aggregate  amount of assets  assigned to each risk  category is
multiplied  by the risk  weight  assigned  to that  category  to  determine  the
weighted  values,  which are added  together to  determine  total  risk-weighted
assets.  At December 31, 1998, TCB's total  risk-based  capital and Tier 1 ratio
were 23.2% and 18.3%, respectively.  Both the Federal Reserve Board and the FDIC
have also  implemented new minimum capital  leverage ratios to be used in tandem
with the risk-based guidelines in assessing the overall capital adequacy of bank
and bank holding companies. Under these rules, banking institutions are required
to maintain a ratio of 3% "Tier 1" capital to total  assets  (net of  goodwill).
Tier 1 capital  includes common  stockholders  equity,  noncumulative  perpetual
preferred  stock and minority  interests in the equity  accounts of consolidated
subsidiaries.



                                        6

<PAGE>



Both the  risk-based  capital  guidelines  and the  leverage  ratio are  minimum
requirements,  applicable only to top-rated banking  institutions.  Institutions
operating at or near these levels are  expected to have  well-diversified  risk,
excellent asset quality,  high liquidity,  good earnings and in general, have to
be considered strong banking  organizations,  rated composite 1 under the CAMELS
rating system for banks or the BOPEC rating  system for bank holding  companies.
Institutions  with lower  ratings and  institutions  with high levels of risk or
experiencing  or anticipating  significant  growth would be expected to maintain
ratios 100 to 200 basis points above the stated minimums.

The Federal Deposit Insurance  Corporation  Improvement Act of 1991 (or FDICIA),
created five "capital categories" ("well capitalized," "adequately capitalized,"
"undercapitalized,"    "significantly    undercapitalized"    and    "critically
undercapitalized")  which are defined in the Act and which are used to determine
the severity of  corrective  action the  appropriate  regulator  may take in the
event an institution reaches a given level of undercapitalization.  For example,
an  institution   which  becomes   "undercapitalized"   must  submit  a  capital
restoration plan to the appropriate  regulator  outlining the steps it will take
to become  adequately  capitalized.  Upon approving the plan, the regulator will
monitor the institution's compliance.  Before a capital restoration plan will be
approved, any entity controlling a bank (i.e., holding companies) must guarantee
compliance with the plan until the  institution has been adequately  capitalized
for four consecutive calendar quarters.  The liability of the holding company is
limited to the lesser of five percent of the  institution's  total assets or the
amount which is  necessary to bring the  institution  into  compliance  with all
capital  standards.  In  addition,   "undercapitalized"   institutions  will  be
restricted   from  paying   management   fees,   dividends   and  other  capital
distributions,  will be subject to certain asset growth restrictions and will be
required to obtain prior  approval  from the  appropriate  regulator to open new
branches or expand into new lines of business.  As an institution drops to lower
capital levels,  the extent of action to be taken by the  appropriate  regulator
increases,  restricting  the types of  transactions in which the institution may
engage and  ultimately  providing for the  appointment of a receiver for certain
institutions deemed to be critically undercapitalized.

The FDICIA  required  each federal  banking  agency to prescribe for all insured
depository  institutions  and their  holding  companies  standards  relating  to
internal controls,  information  systems and audit systems,  loan documentation,
credit   underwriting,   interest  rate  risk   exposure,   asset  growth,   and
compensation,  fees and  benefits  and such  other  operational  and  managerial
standards as the agency deems  appropriate.  In  addition,  the federal  banking
regulatory   agencies  were  required  to  prescribe  by  regulation   standards
specifying:  (i)  maximum  classified  assets to capital  ratios;  (ii)  minimum
earnings  sufficient to absorb losses without  impairing  capital;  (iii) to the
extent  feasible,  a minimum  ratio of market  value to book value for  publicly
traded shares of depository  institutions or the depository  institution holding
companies; and (iv) such other standards relating to asset quality, earnings and
valuation as the agency deems appropriate.  Finally, each federal banking agency
was  required  to  prescribe  standards  for  employment   contracts  and  other
compensation  arrangements  of  executive  officers,  employees,  directors  and
principal  stockholders of insured  depository  institutions that would prohibit
compensation  and benefits  and other  arrangements  that are  excessive or that
could  lead to a  material  financial  loss for the  institution.  If an insured
depository institution or its holding company fails to meet any of its standards
described  above,  it will be  required  to  submit to the  appropriate  federal
banking  agency  a plan  specifying  the  steps  that  will be taken to cure the
deficiency.  If an  institution  fails to submit an acceptable  plan or fails to
implement the plan,  the  appropriate  federal  banking  agency will require the
institution or holding  company,  to correct the deficiency and until corrected,
may impose  restrictions on the institution or the holding company including any
of the restrictions  applicable under the prompt corrective action provisions of
the FDICIA.

In response to the directive  issued under the Act, the regulators  have adopted
regulations which, among other things, prescribe the capital thresholds for each
of the five  capital  categories  established  by the Act. The  following  table
reflects the capital thresholds:
<TABLE>
<CAPTION>
                                                              Total Risk -          Tier 1 Risk -        Tier 1
                                                            Based Capital          Based Capital        Leverage
                                                               Ratio                  Ratio              Ratio
                                                            -------------          -------------        --------
<S>                                                           <C>                  <C>                <C>
Well capitalized (1)                                            10%                       6%               5%
Adequately capitalized (1)                                       8%                       4%               4%(2)
Undercapitalized (3)                                          less than  8%        less than  4%      less than   4%
Significantly Undercapitalized (3)                            less than  6%        less than  3%      less than   3%
Critically Undercapitalized                                      -                        -           less than   2%
</TABLE>

(1)  An institution must meet all three minimums.
(2)  3% for  composite  1-rated  institutions,  subject to  appropriate  federal
     banking agency guidelines.
(3)  An  institution  falls  into this  category  if it is below  the  specified
     capital level for any of the three capital measures.

                                        7

<PAGE>



The Act also  provided  that banks  must have to meet new  safety and  soundness
standards.  In order to comply with the Act, the Federal Reserve Board,  and the
FDIC, adopted a final Rule which institutes  guidelines defining operational and
managerial standards relating to internal controls,  loan documentation,  credit
underwriting,  interest  rate  exposure,  asset  growth,  director  and  officer
compensation,  asset  quality,  earnings and stock  valuation.  Both the capital
standards and the safety and soundness standards which the Act to implement were
designed to bolster and protect the deposit insurance fund.

As a state  bank,  TCB-Volusia  is  subject  to  examination  and  review by the
Department.   TCB-Volusia  submits  to  the  Department   quarterly  reports  of
condition,  as well as such  additional  reports as may be required by the state
banking laws.

Under the Riegle-Neal  Interstate Banking and Branching  Efficiency Act of 1994,
existing  restrictions  on  interstate  acquisitions  of banks  by bank  holding
companies were repealed on September 29, 1995,  such that TCB and any other bank
holding  company  located in Florida would be able to acquire any  Florida-based
bank,  subject  to  certain  deposit  percentage  and  other  restrictions.  The
legislation  also provides that,  unless an individual  state elects  beforehand
either (i) to  accelerate  the effective  date or (ii) to prohibit  out-of-state
banks from operating interstate branches within its territory,  on or after June
1, 1997, adequately  capitalized and managed bank holding companies will be able
to  consolidate.  De novo branching by an  out-of-state  bank would be permitted
only if it is expressly  permitted by the laws of the host state.  The authority
of a bank to establish and operate  branches  within a state will continue to be
subject to applicable state branching laws. During its 1996 Legislative  Session
the Florida Legislature  adopted Legislation which permits interstate  branching
by acquisition but not by de novo branching.

As a bank  holding  company,  TCB is required  to file with the Federal  Reserve
Board an annual report of its operations at the end of each fiscal year and such
additional  information as the Federal Reserve Board may require pursuant to the
Act. The Federal Reserve Board may also make examinations of TCB and each of its
subsidiaries.

The scope of regulation  and  permissible  activities of TCB and  TCB-Volusia is
subject to change by future federal and state legislation.


ITEM 2. - DESCRIPTION OF PROPERTY

     TCB-Volusia  commenced business  operations on October 14, 1997 in a leased
     shopping center unit located in the Trails Shopping Center in Ormond Beach,
     Florida.  The facility is a 3,380 square foot unit consisting of a customer
     lobby,  with 3 teller  stations,  customer  lounge,  3 executive  officers,
     operation area, and an employee lounge. TCB's headquarters are also located
     in this facility.


ITEM 3. - LEGAL PROCEEDINGS

     There are no material pending legal proceedings to which TCB or TCB-Volusia
     is a party or of which any of their  properties are subject;  nor are there
     material  proceedings  known to TCB to be contemplated by any  governmental
     authority;  nor are there  material  proceedings  known to TCB,  pending or
     contemplated,  in which any director,  officer,  affiliate or any principal
     security  holder of TCB,  or any  associate  of any of the  foregoing  is a
     party.


ITEM 4. - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - None








                                        8

<PAGE>



                                     PART II

ITEM 5. - MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS

     During the period  covered  by this  report and to date,  there has been no
     established public trading market for TCB's Common Stock.

     As of March 15, 1999, the approximate  number of holders of record of TCB's
     Common Stock was 350.

     To date,  TCB has not paid any  dividends  on its Common  Stock.  It is the
     present  policy of the Board of Directors  of TCB to reinvest  earnings for
     such period of time as is necessary to ensure the success of the operations
     of TCB and of TCB-Volusia.  There are no current plans to initiate  payment
     of cash  dividends,  and future  dividend  policy will depend on the Bank's
     earnings,  capital  requirements,  financial  condition  and other  factors
     considered relevant by the Board of Directors of TCB.

     TCB-Volusia  is restricted  in its ability to pay  dividends  under Florida
     banking  laws  and  by  regulations  of  the  Federal   Deposit   Insurance
     Corporation. Pursuant to Section 658.37, Florida Statutes, a state bank may
     not pay dividends  from its capital.  All dividends must be paid out of net
     profits then on hand, after charging off bad debts, depreciation, and other
     worthless  assets.  Payment  of  dividends  out of net  profits  is further
     limited by Federal  regulation  which prohibits the payment of dividends if
     such payment would bring the Bank's capital below required levels.

     TCB commenced its initial public offering of common stock on April 28, 1997
     which was the effective date of the Securities Act registration  statement,
     File No. 333-19201.  The offering is a continuous  offering made under Rule
     415  whereby  TCB  offered  up to  750,000  shares of  common  stock for an
     aggregate  of  $7,500,000.  The  minimum  offering  of  450,000  shares was
     completed on  September  19, 1997 and a closing was held at that time which
     resulted in TCB obtaining  $4,500,000 in total  offering  proceeds from the
     Escrow  Agent.  The  offering was still open as of December 31, 1997 and an
     additional  14,791  shares were sold between  September 20 and December 31,
     1997 resulting in TCB obtaining  $147,910 in additional  offering  proceeds
     from the Escrow  Agent.  As of December 31,  1997,  TCB had sold a total of
     464,791  shares  of  common  stock  at  $10.00  per  share  for a total  of
     $4,647,910 in offering proceeds.

     From the Effective Date of Registration to and including  December 31, 1997
     TCB had incurred $14,720 in expenses associated with the offering, issuance
     and  distribution  of the common stock sold through  December 31, 1997.  No
     such expenses were paid to directors,  officers or 10% shareholders of TCB,
     or their affiliates. All such payments were made to others. After deducting
     the above  expenses,  TCB  received  $4,633,190  in net  proceeds.  Of this
     amount,  TCB  purchased  100% of the issued and  outstanding  shares of The
     Commercial Bank of Volusia County for $4,250,000 and retained  $383,190 for
     working capital.  As of December 31, 1998, TCB had not issued any shares in
     exchange for outstanding warrants.


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

     TCB hereby  incorporates  by reference the section  entitled  "Management's
     Discussion  and Analysis of Financial  Condition and Results of Operations"
     on pages 7 through 20 of the 1998  Annual  Report to  Shareholders  for the
     year ended December 31, 1998 filed as an Exhibit under Item 13 herein.


ITEM 7. - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     TCB hereby  incorporates by reference the Independent  Auditors' Report and
     the Consolidated  Financial  Statements contained in the 1998 Annual Report
     filed as an Exhibit under Item 13 herein.


ITEM 8. - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE MATTERS - None

                                        9

<PAGE>




                                    PART III

ITEM 9. - DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT

     TCB hereby  incorporates  by reference the sections  entitled  "Election of
     Directors" and "Board of Directors  Meeting" contained at pages 2 through 5
     of the Proxy Statement filed as an Exhibit under Item 13 herein.


ITEM 10. - EXECUTIVE COMPENSATION

     TCB hereby  incorporates  by  reference  the  section  entitled  "Executive
     Compensation"  contained  at  page 5 of the  Proxy  Statement  filed  as an
     Exhibit under Item 13 herein.


ITEM 11. - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

(a)        Security Ownership of Certain Beneficial Owners

TCB  hereby  incorporates  by  reference  the  sections  entitled  "Election  of
Directors" and "Certain Shareholders" contained at page 2 of the Proxy Statement
filed as an Exhibit under Item 13 herein.

(b)        Security Ownership of Management

TCB  hereby   incorporates  by  reference  the  section  entitled  "Election  of
Directors"  contained  at pages 2 through 3 of the Proxy  Statement  filed as an
Exhibit under Item 13 herein.

(c)        Changes in Control

TCB is not aware of any  arrangements,  including  any  pledge by any  person of
securities of TCB, the  operation of which may at a subsequent  date result in a
change of control of TCB.


ITEM 12. - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     TCB  hereby   incorporates   by  reference  the  section  titled   "Certain
     Relationships  and Related  Transactions"  contained at page 5 through 6 of
     the Proxy Statement filed as an exhibit under Item 13 herein.



                                       10

<PAGE>




ITEM 13. - EXHIBITS AND REPORTS ON FORM 8-K.

     (a) Exhibits.  The  following  exhibits are filed with or  incorporated  by
     reference  into this  report.  The  exhibits  which are  denominated  by an
     asterisk  (*)  were  previously   filed  as  a  part  of,  and  are  hereby
     incorporated  by reference from TCB's  Registration  Statement on Form SB-2
     under the  Securities Act of 1933 for TCB, as effective with the Securities
     and Exchange  Commission  on April 28,  1997,  Registration  No.  333-19201
     (referred to as "Registration  Statement").  The exhibit numbers correspond
     to the exhibit numbers in the referenced documents.



Exhibit No.             Description of Exhibit
-----------             ----------------------

   *3.1   Amended and Restated Articles of Incorporation of TCB (Registration
               Statement)

   *3.2   By-laws of TCB (Registration Statement)

   *4.1   Specimen Common Stock Certificate (Registration Statement)

   *4.2   Specimen Warrant Certificate (Registration Statement)

   *4.4   Company's Warrant Plan (Registration Statement)

   22.1   TCB's 1999 Annual Meeting Proxy Statement.

   22.2   TCB's 1998 Annual Report


(b)  Reports on Form 8-K.           TCB did not file any reports on Form 8-K
     --------------------           during the last quarter of 1998.




                                       11

<PAGE>



                                   SIGNATURES


Pursuant to the requirements of Section 15(d) of the Securities  Exchange Act of
1934,  the  Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

                              The Commercial Bancorp,  Inc.


Dated:  March 30, 1999             By: /s/Gary G. Campbell
        --------------             -----------------------
                                   Gary G. Campbell
                                   President & CEO


Dated:  March 30, 1999             By: /s/Harvey E. Buckmaster
        --------------             ---------------------------
                                   Harvey E. Buckmaster
                                   Chief Financial and Accounting Officer


Pursuant to the requirements of 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:


/s/GARY G. CAMPBELL                               March 30, 1999
-------------------                               --------------
GARY G. CAMPBELL,  President & CEO


/s/JAMES R. PEACOCK                               March 28, 1999
-------------------                               --------------
JAMES R. PEACOCK,  Director, Vice Chairman


/s/LARRY A. KENT                                  March 30, 1999
----------------                                  --------------
LARRY A. KENT,  Director, Chairman


/s/RICHARD R. DWYER                               March 30, 1999
-------------------                               --------------
RICHARD R. DWYER,  Director


/s/NORBERT A. WALZ                                March 30, 1999
------------------                                --------------
NORBERT A. WALZ,  Director


/s/JAMES F. MCCOLLUM                              March 30, 1999
--------------------                              --------------
JAMES F. MCCOLLUM,  Director


/s/H. FREDERICK KIEBER                            March 30, 1999
----------------------                            --------------
H. FREDERICK KIEBER, MD,  Director


         SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO
         SECTION  15(d) OF THE ACT BY  REGISTRANTS  WHICH  HAVE  NOT  REGISTERED
         SECURITIES PURSUANT TO SECTION 12 OF THE ACT.

TCB's Proxy  Statement  and 1998 Annual Report are included as Exhibits 22.1 and
22.2 of this filing.


                                       12