UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20552

                                   ----------

                                    FORM 10-K

(Mark One)

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

For the fiscal year ended    September 30, 1999
                             ------------------
                                       OR

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

For the transition period from ________ to ________

                        Commission file number 000-22817

                         HARBOR FLORIDA BANCSHARES, INC.
             (Exact name of registrant as specified in its charter)

              DELAWARE                               65-0813766
              --------                               ----------
  (State or other jurisdiction                     (I.R.S. employer
of incorporation or organization)                  identification no.)

                              100 S. SECOND STREET
                              FORT PIERCE, FL 34950
                    (Address of principal executive offices)
                                   (ZIP code)

Registrant's telephone number, including area code   (561) 461-2414
                                                     --------------
Securities registered pursuant to Section 12(b) of the Act:

                                      None

Securities registered pursuant to Section 12(g) of the Act:

                         Common Stock (par value $0.10)
--------------------------------------------------------------------------------
                                (Title of class)

--------------------------------------------------------------------------------
                                (Title of class)


                                        1
<PAGE>



     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

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

         The aggregate  market value of the voting stock held by  non-affiliates
of the  Registrant  computed by  reference to the average bid and asked price of
the common stock as of December 10, 1999 ($12.6875) was $344,764,124.

         The number of shares of common stock  outstanding  on December 10, 1999
was 27,173,527.


Documents incorporated by reference:
------------------------------------

1.       Annual Report to Stockholders for the fiscal year ended
         September 30, 1999 (Parts II and III).

2.       Proxy Statement for the 2000 Annual Meeting of
         Stockholders (Part III).


                                       2
<PAGE>



                                TABLE OF CONTENTS



Item                                                                 Page
No.                                                                   No.

      Part I

 1    Business...................................................     4

 2    Properties.................................................    23

 3    Legal Proceedings..........................................    26

 4    Submission of Matters to a Vote of Security-Holders........    26

      Part II

 5    Market for Registrant's Common Equity and
      Related Stockholder Matters................................    26

 6    Selected Financial Data....................................    27

 7    Management's Discussion and Analysis of Financial
      Condition and Results of Operations........................    27

 7A   Quantitative and Qualitative Disclosures about Market Risk.    27

 8    Financial Statements and Supplementary Data................    27

 9    Changes in and Disagreements with Accountants on
      Accounting and Financial Disclosure........................    27

      Part III

10    Directors and Executive Officers of the Registrant.........    27

11    Executive Compensation.....................................    27

12    Security Ownership of Certain Beneficial Owners
      and Management.............................................    28

13    Certain Relations and Related Transactions.................    28

14    Exhibits, Financial Statement Schedules, and Reports
      on Form 8-K................................................    28


                                       3
<PAGE>


                                     PART I

Item 1.  Business

General

         Harbor Florida Bancshares,  Inc. (the "Company" or "Bancshares") is the
holding company for Harbor Federal  Savings Bank (the "Bank").  The Company owns
100% of the Bank's common stock.  Currently,  it engages in no other significant
activities  beyond its ownership of the Bank's common stock.  Consequently,  its
net income is derived from the Bank.  The Bank  provides a wide range of banking
services and is engaged in the business of attracting  deposits  primarily  from
the communities it serves and using these and other funds to originate primarily
one-to-four family first mortgage loans for retention in its portfolio.

         Prior to March 18,  1998,  the  Company's  predecessor  entity,  Harbor
Florida Bancorp,  Inc.  ("Bancorp"),  was  approximately  53.37% owned by Harbor
Financial M.H.C.  ("Mutual Holding Company") and 46.63% by public  shareholders.
On March 18, 1998,  pursuant to a plan of  conversion  and  reorganization,  and
after a  series  of  transactions:  (1) a new  entity,  Bancshares,  became  the
surviving  corporate  entity,  (2)  Bancshares  sold the  ownership  interest in
Bancorp  previously  held by the  Mutual  Holding  Company  to the  public  in a
subscription  offering  (the  "Offering")  (16,586,752  common  shares at $10.00
resulting in net cash proceeds after costs and funding the ESOP of approximately
$150  million),  (3) previous  public  shareholders  of Bancorp had their shares
exchanged into 14,112,400 common shares of Bancshares  (exchange ratio of 6.0094
to 1) (the "Exchange"),  and (4) the Mutual Holding Company ceased to exist. The
total number of shares of common stock  outstanding  following  the Offering and
Exchange  was  30,699,152.  The  reorganization  was  accounted  for in a manner
similar  to a  pooling  of  interests  and did  not  result  in any  significant
accounting  adjustments.  As a result of the  reorganization,  the  consolidated
financial statements for prior periods have been restated to reflect the changes
in the par value of common  stock  from $.01 to $.10 per share and in the number
of authorized shares of common stock from 13,000,000 to 70,000,000.


Market Area

         The Company  serves  communities  in six  growing  and diverse  Florida
counties. Its headquarters are in Fort Pierce,  Florida,  located on the eastern
coast  of  Florida  between  Stuart  and  Daytona  Beach.  In  addition  to  its
headquarters,  it has sixteen  branch  offices in St.  Lucie,  Indian  River and
Martin  counties,   located  on  Florida's   "Treasure   Coast."  This  area  is
characterized  by both a large  retirement  and vacation home  population  and a
significant  agricultural economy,  primarily citrus crops. The Company has five
branch offices located in Brevard County, which encompasses the "Space Coast" of
the state.  Brevard  County has a greater  industrial  base fueled  primarily by
companies  related  to NASA  and the John F.  Kennedy  Space  Center.  Prominent
electronics concerns such as Harris Corporation are also major employers in this
area.  The Company also has one branch  office in  Okeechobee  County,  a rural,
agricultural area, and six branch offices in Volusia County, where tourism and a
large retirement population predominate.

Lending Activities

         General.  The Company's  principal  lending  activity has  historically
been, and will continue to be for the  foreseeable  future,  the  origination of
one-to-four family residential  mortgage loans.  Although the Company sells some
conforming  loans,  primarily  to  the  Federal  National  Mortgage  Association
("FNMA") and the Federal Home Loan Mortgage Corporation  ("FHLMC"),  and has, on
rare  occasions,  purchased  whole  loans and loan  participations,  it  focuses
primarily  on the  origination  of loans and retains them in its  portfolio  for
investment.  See " --  Lending  Activities  --  One  to  Four  Family  Permanent
Residential  Mortgage  Loans" below.  The Company also  originates a substantial
amount of one-to-four  family  residential  construction and consumer loans, and
consumer  installment,  commercial  real estate and commercial  business  loans.
Substantially all of the Company's mortgage loans are secured by property in its
market  area and most of its  nonmortgage  loans  are made to  borrowers  in its
market area.
                                       4
<PAGE>

         The Company offers both fixed-rate and adjustable rate mortgage ("ARM")
loans. The Company has sought to increase its origination of ARM loans to reduce
its interest rate risk.  However,  the Company's  ability to originate ARM loans
has been limited by borrower  preference for fixed-rate loans in many instances,
particularly in low interest rate environments.

         Loan  and  Mortgage  - Backed  Securities  Portfolio  Composition.  The
following  table sets forth a summary of the  composition  of the Company's loan
and mortgage-backed securities portfolio by type of loan.
<TABLE>
<CAPTION>
                                                                              September 30,
                           ------------------------------------------------------------------------------------------------------
                                   1999                  1998                1997                1996                1995
                                   -----                 -----               -----               -----               ----
                                        Percent             Percent             Percent            Percent             Percent
                                          of                  of                  of                 of                   of
                             Amount      Total      Amount  Total       Amount   Total     Amount   Total      Amount   Total
                                                                      (Dollars in thousands)

Mortgage Loans
--------------
<S>                           <C>       <C>       <C>       <C>       <C>       <C>      <C>       <C>       <C>       <C>
Construction 1 - 4 Family     $ 91,922    7.94%   $ 66,671    6.62%   $ 47,800    5.42%  $ 43,994    5.46%   $ 40,634    6.07%
Permanent 1 - 4 Family...      788,408   68.12     707,078   70.26     629,906   71.46    584,297   72.49     487,480   72.84

Multifamily..............       15,141    1.31      11,074    1.10      15,326    1.74     17,804    2.21      14,916    2.23

Nonresidential...........       99,824    8.63      84,254    8.37      54,983    6.24     41,970    5.21      31,980    4.78

Land.....................       41,882    3.62      27,562    2.75      33,182    3.76     29,034    3.60      20,460    3.06
                             ---------   -----     -------  ------     -------  ------    -------  ------    --------    ----
    Total Mortgage Loans.    1,037,177   89.62     896,639   89.10     781,197   88.62    717,099   88.97     595,470   88.98
                             ---------   -----     -------  ------     -------  ------    -------  ------     -------  ------

Other Loans
-----------

Commercial Nonmortgage...       21,192    1.83      15,074    1.50      11,287    1.28      8,199    1.02       8,468    1.27

Consumer:

    Home Improvement.....       17,205    1.49      19,016    1.89      20,614    2.34     20,679    2.56      19,198    2.87

    Manufactured
        Housing..........       16,190    1.40      16,418    1.63      16,399    1.86     15,784    1.96      15,045    2.25

   Other Consumer (1)...        65,489    5.66      59,223    5.88      51,988    5.90     44,265    5.49      31,049    4.63
                             ---------  ------   ---------    ----    --------    ----     ------    ----    --------    ----



    Total Other Loans....      120,076   10.38     109,731   10.90     100,288   11.38     88,927   11.03      73,760   11.02
                            ----------  ------   ---------  ------   ---------  ------   --------  ------    --------  ------

Total Loans Receivable...    1,157,253  100.00%  1,006,370  100.00%    881,485  100.00%   806,026  100.00%    669,230  100.00%
                             ---------  ======   ---------  ======   ---------  ======   --------  ======    --------  ======

Less:

Loans in process.........       70,722              46,152              32,078             26,788              24,321
Deferred loan fees and
    discounts............        4,244               3,700               3,446              3,203               3,519
Allowance for loan losses       11,952              11,818              11,691             11,016              10,083
                            ----------          ----------           ---------           --------            --------

    Subtotal.............       86,918              61,670              47,215             41,007              37,923
                                ------          ----------           ---------           --------            --------

Total Loans Receivable,
     Net.................    1,070,335             944,700             834,270            765,019             631,307

Loans Held for Sale......        1,747                 714                 141              4,870               1,009

Mortgage-Backed
    Securities................ 196,971             201,049             176,854            153,293             164,759
                            ----------          ----------           ---------           --------            --------


Total....................   $1,269,053          $1,146,463          $1,011,265           $923,182            $797,075
                            ==========          ==========          ==========           ========            ========
</TABLE>

 (1) Includes home equity and other second mortgage loans.

                                       5
<PAGE>


       The  following  table shows the  maturity or period to  repricing  of the
Company's loan and mortgage-backed  securities portfolios at September 30, 1999.
Loans that have  adjustable  rates are shown as being due in the period in which
the  interest  rates are next  subject  to change.  The table  does not  include
prepayments  or scheduled  principal  amortization.  Prepayments  and  scheduled
principal  amortization on loans totaled  $278.0,  $246.4 and $163.0 million for
fiscal years 1999, 1998 and 1997, respectively.  Loans having no stated maturity
and no schedule of repayments (including delinquent loans), and demand loans are
reported as due within one year.


<TABLE>
<CAPTION>
                                                 One          Three        Five
                                 Within        through       through      through    Ten through   Beyond twenty
                                one year     three years    five years   ten years   twenty years       years          Total
                                --------     -----------    ----------   ---------   ------------       -----          -----
                                                                       (In thousands)
Mortgage loans:
<S>                              <C>           <C>           <C>         <C>           <C>             <C>           <C>
  Permanent 1 - 4 family..       $129,109      $54,473       $45,516     $60,499       $238,820        $293,389      $821,806
  Other...................         48,216       14,372        34,678      15,922         29,685           1,180       144,053
Other loans:
  Consumer ...............         29,402       12,545        24,606      26,184          5,949              55        98,741
  Commercial .............         13,725          934         3,208       1,518             25           1,782        21,192
Nonperforming loans (1)...          2,486          ---           ---         ---            ---             ---         2,486
Mortgage-backed securities         13,316        7,940        20,477      42,918        112,297              23       196,971
                                   ------        -----        ------      ------        -------          ------       -------
    Sub-total.............       $236,254      $90,264      $128,485    $147,041       $386,776        $296,429    $1,285,249
                                 ========      =======      ========    ========       ========        ========
Deferred loan fees and
    discounts.............                                                                                            (4,244)
Allowance for loan losses.                                                                                           (11,952)
Total (2)(3)..............                                                                                         $1,269,053
                                                                                                                   ==========
</TABLE>

(1) All  nonperforming  loans are reported as due within one year  regardless of
the  actual  maturity  term.  (2)  Amounts  reported  do not  include  principal
repayment or prepayment assumptions.  (3) Amounts include loans held for sale of
$1,747,000 at September 30, 1999.
                                                   --------------

     The following table sets forth the amount of fixed-rate and adjustable-rate
loans at September 30, 1999 due after September 30, 2000.


<TABLE>
<CAPTION>
                                                                Adjustable
                                                 Fixed Rate      Rate            Total
                                                 ----------      ----            -----
                                                           (In thousands)
Mortgage loans:
<S>                                                <C>           <C>           <C>
  Permanent 1 - 4 family.........................  $589,108      $103,589        $692,697
  Other..........................................    49,308        46,529          95,837
Other loans:
  Consumer ......................................    69,339           ---          69,339
  Commercial ....................................     7,467           ---           7,467
                                                      -----         -----           -----
Total loans......................................   715,222       150,118         865,340
Mortgage-backed securities.......................   183,655           ---         183,655
                                                    -------        ------         -------
Total............................................  $898,877      $150,118      $1,048,995
                                                   ========      ========      ==========
</TABLE>
                                       6
<PAGE>


       One-to-Four  Family Permanent  Residential  Mortgage Loans. The Company's
primary  lending  activities  focus on the  origination  of  one-to-four  family
residential mortgage loans. The Company generally does not originate one-to-four
family  residential loans on properties outside of its market area. At September
30, 1999,  $788.4  million or 68.1% of the  Company's  total loan  portfolio and
53.9% of total assets consisted of one-to-four family loans and over 95% of such
loans were collateralized by properties located in the Company's market area.

       The Company's fixed rate loans generally are originated and  underwritten
according to standards that permit sales in the secondary market.  However,  the
decision to sell depends on a number of factors including the yield and the term
of the loan, market  conditions,  and the Company's current portfolio  position.
The  Company  sells a small  portion  of newly  originated  30 year  fixed  rate
mortgage  loans.  In addition,  the Company  sells loans under the single family
Mortgage Revenue Bond Programs through local County Housing Finance Authorities.
The servicing on these loans is also released.

       The Company  currently offers  one-to-four  family  residential  mortgage
loans with fixed,  adjustable  or a  combination  of  fixed/adjustable  interest
rates.  Originations of fixed rate mortgage loans versus ARM loans are monitored
on an  ongoing  basis  and are  affected  significantly  by the  level of market
interest rates,  customer preference,  the Company's interest rate gap position,
and loan products offered by the Company's  competitors.  In a low interest rate
environment,  borrowers typically prefer fixed rate loans to ARM loans, and even
if  management's  strategy is to emphasize ARM loans,  market  conditions may be
such that there is greater demand for fixed rate mortgage loans.

       The Company  generates  residential  mortgage loan activity through local
advertising, its existing customers and referrals from local real estate brokers
and home builders.  All loans are  originated by Company loan officers,  none of
whom have underwriting authority. Independent loan brokers are not used.

       Residential  loans are authorized and approved under central authority by
experienced  underwriters.  Underwriters  have  individual  authority to approve
loans up to the maximum amount of $250,000. Residential mortgage loans in excess
of this amount are  approved  by  management  individually  up to $750,000 or by
committee if above $750,000.  The Company also has direct endorsement  authority
from the Federal Housing Authority ("FHA") to allow for internal approval of FHA
insured loans. FHA loans are approved under central  authority by an underwriter
with a "Direct Endorsement" designation from the FHA. The Company's underwriting
standards are intended to ensure that borrowers are sufficiently  credit worthy,
and all of the Company's lending is subject to written underwriting policies and
guidelines  approved  by  the  Company's  Board  of  Directors.   Detailed  loan
applications are designed to determine the borrower's  ability to repay the loan
and certain information  solicited in these applications is verified through the
use of credit reports, financial statements and other confirmations. The Company
obtains an appraisal of substantially  all of the proposed  security property in
connection with  residential  mortgage loans.  Additionally,  title insurance is
required for all mortgage loans except home equity loans of $50,000 or less.

       The types,  amounts,  terms of and security for conventional loans (those
not insured or guaranteed by the U.S.  government or agencies thereof,  or state
housing  agencies)  originated  by the Company are  significantly  prescribed by
federal  regulation.  The Office of Thrift Supervision ("OTS") regulations limit
the amount which the Company can lend up to specified  percentages  of the value
of the real  property  securing the loan,  as  determined by an appraisal at the
time the loan is originated (referred to as "loan-to-value ratios"). The Company
makes one-to-four family home loans and other residential real estate loans with
loan-to-value  ratios  generally  of up to  80% of the  appraised  value  of the
security property. In certain circumstances  loan-to-value ratios exceed 80%, in
which case private mortgage insurance is generally required.  A substantial part
of the Company's loan originations are made to borrowers to finance second homes
for vacation use or for use as a rental  property.  Such loans may be considered
to have a higher credit risk than loans to finance a primary residence.

       One-to-Four  Family  Residential   Construction  Loans.  A  part  of  the
Company's  loan  originations  are to finance the  construction  of  one-to-four
family homes in the Company's market area. At September 30, 1999 the Company had
$91.9  million  in such  loans,  representing  7.9% of  total  loans.  It is the
Company's  policy to disburse loan proceeds as  construction  progresses  and as
inspections warrant.
                                       7
<PAGE>

       A portion of these  loans is made  directly  to the  individual  who will
ultimately own and occupy the home. Of these, the vast majority is structured at
origination  to guarantee  the  permanent  financing to the Company as well.  In
recent years the  origination  of these  construction  loans to  individuals  is
second in volume only to the  origination  of  traditional  loans to finance the
purchase or refinance of an existing home.  However,  the  significance  of this
type of lending to the Company is not evident  from the amount of these loans in
its portfolio at any given time because these  construction loans to individuals
usually "roll" into permanent financing.

       Approximately  one-half of the Company's  one-to-four family construction
loans are to builders.  In most  instances  these loans are also  structured  to
guarantee permanent financing by the Company.

       Consumer  Loans.  The Company  originates  consumer loans as an essential
element  in  its  retail-oriented  strategy.   Secured  consumer  loans  include
automobile,  manufactured  housing,  boat and truck loans,  home equity and home
improvement  loans as well as loans secured by the borrower's  deposit  accounts
with the Company.  The loans for manufactured  housing are generally  originated
within  quality,  retirement  lifestyle  communities  spread  throughout the six
county  market  area  that  feature  amenities  such as full  service  clubhouse
facilities, swimming pools, and, in a number of cases, golf courses. These loans
are subject to the normal underwriting  standards of the Company. Loans are made
on either a fixed-rate or  adjustable-rate  basis, with terms generally up to 20
years. A limited  amount of unsecured  consumer  loans are also  originated.  At
September 30, 1999,  consumer-oriented loans accounted for $98.9 million or 8.6%
of the Company's total loan portfolio.

       Non-Residential  and Land Mortgage  Loans. In the late 1980's the Company
curtailed its lending in  non-residential  mortgages with the exception of loans
to finance the sale of the Company's real estate acquired  through  foreclosure.
In recent years,  the Company  re-entered this market and made a total of $34.7,
$38.3 million and $18.3 million of non-residential  mortgage loans in 1999, 1998
and 1997, respectively.  At September 30, 1999, nonresidential loans constituted
8.6% of the Company's total loan  portfolio.  Origination of these loans plays a
subordinate role to the origination of residential mortgage and consumer-related
loans.  Non-residential  mortgage  loans are  offered on  properties  within the
Company's primary market area using both fixed or adjustable rate programs.

       Loans  secured by  non-residential  real estate  generally  carry  larger
balances  and  involve  a  greater  degree  of  risk  than  one-to-four   family
residential  mortgage loans. This increased risk is a result of several factors,
including  the  concentration  of  principal  in a  limited  number of loans and
borrowers,  the  effects  of general  economic  conditions  on  income-producing
properties,  and the increased  difficulty of evaluating  and  monitoring  these
loans.  Furthermore,  the repayment of loans secured by non-residential property
is typically dependent upon the successful  operation of the related real estate
project. If the cash flow from the project is reduced, the borrower's ability to
repay the loan may be impaired.  See "Business -- Delinquent,  Nonperforming and
Classified Assets."

       The Company also  originates  developed  building lot loans ("lot loans")
secured by individual  improved lots for future  residential  construction.  Lot
loans are offered  with either a fixed or  adjustable  interest  rate and with a
maximum term of up to 15 years.  At September 30, 1999 these loans accounted for
$16.7 million or 1.4% of the Company's total loan portfolio.

       Other  Loans.   The  balance  of  the  Company's   lending   consists  of
multi-family  mortgage and commercial  non-mortgage loans. At September 30, 1999
these  loans  represented  $15.1  million  or 1.3% and  $21.2  million  or 1.8%,
respectively,  of the Company's total loan portfolio.  The multi-family mortgage
loans are secured primarily by apartment  complexes.  These loans are subject to
the same  lending  limits  as  apply to the  Company's  commercial  real  estate
lending.  The commercial  non-mortgage loans represent  primarily  equipment and
other business loans to  professionals  such as physicians and attorneys.  These
loans are an integral part of the Company's  strategy of seeking synergy between
its various deposit and loan products and as a service to existing customers.

                                       8
<PAGE>

Origination and Sale of Loans

       From time to time the Company has sold mortgage  loans,  primarily to the
FNMA and the FHLMC.  Historically,  the  Company has not  purchased  significant
amounts of loans,  particularly  in light of its past  policy to  control  asset
growth.

       The Company sells a small portion of newly originated  30-year fixed rate
mortgage  loans.  In addition,  the Company  sells loans under the single family
Mortgage Revenue Bond Programs through local County Housing Finance Authorities.
The servicing on these loans is also released.  The purpose of selling a portion
of fixed rate loans from current  production is to reduce  interest rate risk by
limiting  the growth of longer  term fixed  rate loans in the  portfolio  and to
generate service fee income over time.

       The  following  table shows  total loan  origination  activity  including
mortgage-backed securities, during the periods indicated.

<TABLE>
<CAPTION>
                                                              Years Ended September 30,
                                                            1999           1998        1997
                                                            ----           ----        ----
                                                                      (In thousands)
Mortgage loans (gross):
<S>                                                      <C>            <C>          <C>
  At beginning of year (1)..............                  $897,363       $781,341     $722,435
  Mortgage loans originated:
    Construction 1-4 Family.............                   112,508         83,429       63,237
    Permanent 1-4 Family................                   162,866        173,758       84,853
    Multi-family........................                     5,075            605        2,526
    Nonresidential......................                    34,726         38,260       18,302
    Land................................                    22,755         11,313       12,264
                                                            ------         ------       ------
  Total mortgage loans originated (2)...                   337,930        307,365      181,182
  Mortgage loans sold...................                    (8,432)        (9,125)      (8,583)
  Principal repayments..................                  (186,632)      (179,354)    (111,255)
  Mortgage loans transferred to real
     estate owned.......................                    (1,275)        (2,864)      (2,438)
                                                            ------       --------     --------
  At end of year........................                $1,038,954       $897,363     $781,341
                                                        ==========       ========     ========
Other loans (gross):
  At beginning of year..................                 $ 109,731      $ 100,288     $ 88,927
  Other loans originated................                   101,949         77,044       63,406
  Principal repayments..................                   (91,604)       (67,601)     (52,045)
                                                          --------      ---------      -------
  At end of year........................                  $120,076       $109,731     $100,288
                                                          ========       ========     ========
Mortgage-backed securities (gross):
  At beginning of year..................                  $201,049       $176,854     $153,293
  Mortgage-backed securities purchased..                    70,074        100,222       61,769
  Principal repayments..................                   (74,152)       (76,027)     (38,208)
                                                           -------        -------      -------
  At end of year........................                  $196,971       $201,049     $176,854
                                                          ========       ========     ========
</TABLE>
(1)  Includes loans held for sale.
(2)  Loans originated represent loans closed, however all loans may not be fully
     disbursed at time of closing.
                                       9
<PAGE>

Mortgage-backed Securities

       A substantial  part of the Company's  business  involves  investments  in
mortgage-backed  securities  issued or  guaranteed  by an  agency of the  United
States  government.   Historically,  the  Company's  mortgage-backed  securities
portfolio  has  consisted  primarily  of  pass-through  mortgage   participation
certificates issued by FHLMC and FNMA. These pass-through certificates represent
a participation interest in a pool of single-family mortgages, the principal and
interest payments on which are passed from the loans'  originators,  through the
FHLMC and FNMA that pools and packages the participation interests into the form
of securities,  to investors  such as the Company.  The FHLMC and FNMA guarantee
the payment of principal  and  interest.  The  underlying  pool of mortgages can
consist of either fixed-rate or adjustable-rate loans. At September 30, 1999 the
Company's  portfolio of mortgage-backed  securities  consisted entirely of FHLMC
and FNMA  participation  certificates.  Of the $197.0 million in mortgage-backed
securities  at that  date,  approximately  $12.2  million  or  6.2%  represented
adjustable-rate  securities and $184.8 million or 93.8%  represented  fixed-rate
securities with anticipated maturity dates from 2 months to 27 years.

    Adjustable-rate  mortgage-backed securities ("ARM Securities") have periodic
adjustments  in the coupons based on the  underlying  mortgages.  These periodic
coupon  adjustments are subject to annual and lifetime caps. The caps serve as a
limit to the amount that the coupon will change during any coupon-reset  period.
As interest  rates on the  mortgages  underlying  the ARM  Securities  are reset
periodically  (one to 12 months),  the yields on these securities will gradually
adjust  to  reflect  changes  in  market  rates.  Management  believes  that the
adjustable-rate feature of ARM Securities will help to reduce sharp fluctuations
in security value that result from normal changes in interest rates.

    During periods of declining interest rates, the coupon on ARM Securities may
adjust  downward,  resulting  in lower  yields  and  reduced  income  from these
securities.   Thus,   ARM   Securities  may  have  less  potential  for  capital
appreciation as compared to fixed-rate debt securities. During periods of rising
interest  rates,  the coupon on ARM  Securities  may not fully adjust  upward in
conjunction  with  changes  in market  rates due to  annual or  lifetime  coupon
adjustment  caps.  This could result in ARM Securities  that depreciate in value
similar to long-term,  fixed-rate  mortgage securities in a rising interest rate
environment.

    The  Company's  fixed-rate   mortgage-backed   securities  consist  of  both
long-term  and  balloon  securities.  The  long-term  securities  have  original
maturity terms of ten,  fifteen and thirty years.  The balloon  securities  have
principal and interest  amortization  based on a thirty-year  maturity  schedule
with final principal  balloon payments due in five years or seven years from the
date  of the  security.  Balloon  mortgage-backed  securities  are  held  in the
portfolio as a means of reducing the average life of the fixed-rate portfolio. A
shorter  average  portfolio  life  will  help  reduce  the  interest  rate  risk
associated  with  these  investments.   As  of  September  30,  1999  long-term,
fixed-rate  mortgage-backed  securities amounted to $123.1 million and five-year
and seven-year balloon mortgage-backed  securities amounted to $29.5 million and
$31.9 million, respectively.

    During  periods of  declining  interest  rates,  fixed-rate  mortgage-backed
securities  may  have   accelerated   principal   reductions  due  to  increased
refinancing  activity on the underlying  mortgage loans. The reinvestment of the
accelerated principal reductions at lower prevailing rates could result in lower
overall  portfolio  yields and income.  During periods of rising interest rates,
fixed-rate  mortgage-backed  securities will tend to depreciate in value.  Thus,
total returns on fixed-rate  mortgage-backed  securities are expected to decline
as market interest rates rise.

    If  the  Company   purchases   mortgage-backed   securities  at  a  premium,
accelerated principal repayments may result in some loss of principal investment
to the extent of the premium paid. Conversely, if mortgage-backed securities are
purchased at a discount,  accelerated principal reductions will increase current
and total returns.
                                       10

<PAGE>

Delinquent, Nonperforming and Classified Assets

     Delinquent  Loans.  All delinquent loan results are reviewed monthly by the
Company's Board of Directors.  The Company believes it has an effective  process
and policy for dealing with delinquent loans.

       Residential delinquencies are handled by the Loan Collections Department.
This  department  begins  collection  efforts on  residential  loans when a loan
appears on the 15-day delinquent list. Borrowers are sent a notice to accelerate
the debt when the debt is 45 days delinquent.  If the delinquent account has not
been corrected,  foreclosure  proceedings are begun generally at the 75th day of
delinquency.  At September 30, 1999,  residential  loans  delinquent 90 days and
longer represented 0. 2% of the total residential loan portfolio.

       Commercial  delinquent  accounts are  processed by the Problem  Asset and
Lending  Departments.  For commercial  accounts  classified as  Substandard,  as
defined below, or worse, the Problem Asset Department has jurisdiction  over the
collection efforts.  As with residential  delinquent loans, any commercial loans
90 days past due or where the  collection  of the interest or full  principal is
considered doubtful are placed on a non-accrual basis.

       If a collection  action is instituted  on a consumer or commercial  loan,
the Company,  in compliance  with the loan  documents and the law, may repossess
and sell the collateral  security for the loan through  private sales or through
judicially ordered sales when necessary.  Should the sale result in a deficiency
owing to the Company,  the borrowers  generally are pursued where such action is
deemed appropriate,  including recourse based on personal loan guarantees by the
borrower's principals.

       The following table shows the Company's loans  delinquent 90 days or more
at the dates indicated.

<TABLE>
<CAPTION>
                                                            September 30,
                                                            -------------
                                            1999                   1998               1997
                                            ----                   ----               ----
                                                              (Dollars in thousands)
                                           Number   Amount      Number  Amount    Number   Amount
                                           ------   ------      ------  ------    ------   ------
Mortgage loans:
<S>                                        <C>     <C>          <C>    <C>         <C>     <C>
  Construction and land...............        -      $ ---         -     $ ---       2      $ 162
  Permanent 1 - 4 family..............       38      1,854        19       778      28      1,565
  Other mortgage......................        3        489         4     1,102       3        689
                                             --       ----        --    ------      --        ---
  Total mortgage loans................       41      2,343        23     1,880      33      2,416
Other loans...........................        9        198        13       542      10        164
                                             --     ------        --   -------      --     ------
Total loans...........................       50     $2,541        36    $2,422      43     $2,580
                                             ==     ======        ==    ======      ==     ======
Delinquent loans to total loans.......                .24%                .26%               .31%
</TABLE>

     As of September 30, 1999, 1998 and 1997, $0, $25,000 and $0,  respectively,
of loans were on nonaccrual status which were not 90 days past due.
                                       11
<PAGE>

     Nonperforming  Assets.  The Company also places emphasis on improving asset
quality. The Company's nonperforming assets as a percentage of total assets have
decreased from .43% at September 30, 1997 to .24% at September 30, 1999.

     Loans 90 days past due are  generally  placed on  non-accrual  status.  The
Company  ceases to accrue  interest  on a loan once it is placed on  non-accrual
status, and interest accrued but unpaid at that time is charged against interest
income.  Additionally,  any loan where it appears evident that the collection of
interest is in doubt is also placed on a non-accrual  status.  The investment in
impaired  loans  (primarily  consisting of classified  loans),  other than those
evaluated  collectively  for  impairment,  at  September  30,  1999 and 1998 was
$4,511,000 and  $6,109,000,  respectively.  The average  recorded  investment in
impaired  loans  during  the  years  ended  September  30,  1999  and  1998  was
approximately  $5,118,000  and  $7,695,000,  respectively.  The  total  specific
allowance  for loan  losses  related  to these  loans was  approximately  $0 and
$29,000,  respectively,  on  September  30,  1999 and 1998.  Interest  income on
impaired  loans of  approximately  $461,000 and $790,000 was  recognized  in the
years ended September 30, 1999 and 1998, respectively.

     If a foreclosure action is instituted on a real estate-secured loan and the
loan is not reinstated, paid in full, refinanced, or deeded back to the Company,
the  property  is sold at a  foreclosure  sale at which the  Company  may be the
buyer. Thereafter, such acquired property is listed in the Company's real estate
owned ("REO")  account or that of a subsidiary,  until the property is sold. The
Company carries REO at the lower of cost or fair value less cost to dispose. The
Company also finances the sales of REO properties.  Should the foreclosure  sale
not produce  sufficient  proceeds to pay the loan balance and court  costs,  the
Company's  attorneys,  where  appropriate,   may  pursue  the  collection  of  a
deficiency judgment against the responsible borrower.

     It is the  Company's  policy to try to  liquidate  its holdings in REO on a
timely basis while  considering both market  conditions and the cost of carrying
REO properties. Upon acquisition the Company records all REO at the lower of its
fair value (less estimated  costs to dispose),  or cost. The fair value is based
upon the most recent appraisal and management's evaluation. If the fair value of
the asset is less than the loan balance  outstanding,  the difference is charged
against the Company's loan loss  allowance  prior to  transferring  the asset to
REO.  Administration of REO property is handled by the Problem Asset Department,
which is responsible for the sale of all residential and commercial  properties.
In those  instances  where the  property  may be located  outside the  Company's
market area or where the property, due to its nature, requires certain expertise
(i.e., hotels, apartment complexes), outside management firms may be utilized.

                                       12
<PAGE>


    At the dates indicated, nonperforming assets in the Company's portfolio were
as follows:

<TABLE>
<CAPTION>
                                                                      September 30,
                                             -------------------------------------------------------------------
                                                1999           1998          1997          1996            1995
                                                ----           ----          ----          ----            ----
                                                                (Dollars in thousands)
Non-accrual mortgage loans:
<S>                                           <C>           <C>           <C>            <C>           <C>
  Delinquent less than 90 days.............    $  ---        $  ---        $  ---         $ 323         $ 1,153
  Delinquent 90 days or more...............     2,343         1,880         2,416         1,717           2,294
                                                -----         -----         -----         -----           -----
     Total.................................     2,343         1,880         2,416         2,040           3,447
                                                -----         -----         -----         -----           -----
Non-accrual other loans:
  Delinquent less than 90 days.............       ---            25           ---           ---             ---
  Delinquent 90 days or more...............       198           542           164           132              70
                                                -----          ----          ----        ------          ------
     Total.................................       198           567           164           132              70
                                                -----          ----          ----        ------          ------
Total non-accrual loans....................     2,541         2,447         2,580         2,172           3,517
Accruing loans 90 days or more delinquent .       ---           ---           ---           ---             ---
                                                -----         -----         -----         -----           -----
  Total nonperforming loans................     2,541         2,447         2,580         2,172           3,517
                                                -----         -----         -----         -----           -----
Other nonperforming assets:
  Real estate owned........................       911         3,168         2,892         4,830           4,643
  Less allowance for losses................       ---          (634)         (578)       (1,712)         (1,857)
                                                -----          ----          ----        ------          ------
      Total................................       911         2,534         2,314         3,118           2,786
                                                -----          ----          ----        ------          ------
Total nonperforming assets, net............    $3,452        $4,981        $4,894        $5,290          $6,303
                                               ======        ======        ======        ======          ======
Nonperforming loans to total net loans.....     0.24%         0.26%         0.31%         0.28%           0.56%
Total nonperforming assets to
  total assets.............................     0.24%         0.37%         0.43%         0.50%           0.71%
</TABLE>


     For the year ended  September 30, 1999,  interest  income of $184,000 would
have been recorded on loans  accounted  for on a non-accrual  basis if the loans
had been current throughout the period. No interest income was actually included
in net income regarding non-accrual loans during the same period.

     Management evaluates each REO property on no less than a quarterly basis to
assure that the net carrying value of the property on the Company's  books is no
greater  than the fair  market  value  less  estimated  costs to  dispose.  When
necessary,  the property is written down or specific  allowances are established
to reduce the carrying value.

                                                     REO Allowances
                                             Years Ended September 30,
                                         ----------------------------------
                                            1999         1998       1997
                                            ----         ----       ----
                                                   (In thousands)
                                                                  $1,712
 Beginning balance....................     $634         $578
 Provision for (recovery of) losses...     (186)          136      (150)
 Charge-offs..........................     (448)         (80)      (984)
                                           ----          ---       ----
 Ending balance.......................    $ ---         $634       $578
                                          =====         ====       ====

     Provision for losses on REO is included in income (losses) from real estate
operations on the Company's consolidated statements of earnings.

     Not included in the preceding  table are net gains,  (losses) or recoveries
on the sale of real estate  owned of  $207,000,  $176,000  and  $127,000 for the
years ended September 30, 1999, 1998 and 1997, respectively.


                                       13
<PAGE>


       Classified  Assets.  Under OTS  regulations,  problem  assets of  insured
institutions  are classified as either  "substandard,"  "doubtful" or "loss." An
asset is considered  "substandard"  if the current net worth and paying capacity
of the obligor and/or the value of the collateral pledged are no longer adequate
to support the loan.  "Substandard"  assets are  characterized  by the "distinct
possibility"  that the  insured  institution  will  sustain  "some  loss" if the
deficiencies are not corrected.  Assets classified as "doubtful" have all of the
weaknesses   inherent  in  those  classified   "substandard,"   with  the  added
characteristic  that the weaknesses  present make  "collection or liquidation in
full," on the basis of currently existing facts, conditions, and values, "highly
questionable  and  improbable."  Assets  classified  "loss" are those considered
"uncollectible"  and of such  little  value  that  their  continuance  as assets
without  the  establishment  of a specific  loss  reserve is not  warranted.  In
addition to the classification of assets as "substandard," "doubtful" or "loss,"
the OTS  regulations  also require that assets that do not currently  expose the
Company to a  sufficient  degree of risk to warrant  one of the three  foregoing
classifications but which do possess credit deficiencies or potential weaknesses
deserving management's close attention must be designated "special mention."

       When  an  insured   institution   classifies  problem  assets  as  either
substandard  or doubtful,  it is required to establish  specific  allowances for
loan losses in an amount considered appropriate by management.  See "--Allowance
for Loan  Losses"  below.  Additionally,  the  institution  establishes  general
allowances to recognize the inherent risk  associated  with lending  activities,
but which,  unlike  specific  allowances,  have not been allocated to particular
problem assets. When an insured institution classifies problem assets as "loss,"
it is required either to establish a specific allowance for losses equal to 100%
of the  amount of the asset so  classified  or to  charge-off  such  amount.  An
institution's  determination  as to the  classification  of its  assets  and the
amount of its valuation  allowances  is subject to review by the OTS,  which can
order the establishment of additional general or specific loss allowances.

       The following table presents the Company's classified assets at the dates
indicated.

                                      September 30,
                                      -------------
                                  1999      1998     1997
                                  ----      ----     ----
                                         (In thousands)
Substandard:
  Real Estate Owned..........    $ 911   $ 3,168  $ 2,892
  Loans......................    5,180     5,375    9,832
                                 -----     -----    -----
    Total Substandard........    6,091     8,543   12,724
Doubtful.....................      ---       ---      ---
Loss.........................      ---       202      117
                                   ---       ---      ---
                                $6,091    $8,745  $12,841
                                ======    ======  =======

                                       14
<PAGE>

Allowance for Loan Losses

     Provisions  for loan  losses are  charged to  operations  to  establish  an
allowance for loan losses;  recognized loan losses (recoveries) are then charged
(credited)  to  the  allowance.  The  Company  evaluates  the  outstanding  loan
portfolio with respect to the adequacy of the allowance for loan losses at least
quarterly.

     Management's  policy is to provide for  estimated  losses on the  Company's
loan portfolio based on management's evaluation of the probable losses (existing
and  inherent).  Such  evaluations  are made for all major  loans on which  full
collectibility of interest and/or principal may not be reasonably  assured.  The
factors that the Company  considers  are the estimated  value of the  underlying
collateral,  the  management of the  borrower,  and current  operating  results,
trends and cash flow. In addition to analyzing individual loans, management also
analyzes on a regular basis its asset  classification and recent loss experience
on other loans to help insure that prudent general  allowances are maintained on
one-to-four  family loans,  automobile  loans and home equity loans.  Management
periodically  evaluates the allowance percentages utilized for general allowance
purposes based upon delinquencies, charge-off, underwriting, and other trends.

     The Company  segregates  the loan portfolio for loan loss purposes into the
following  broad  segments:  commercial  real estate,  residential  real estate,
commercial business and consumer loans.

     The Company  provides for a general  allowance  for losses  inherent in the
portfolio by the above  categories,  which consists of two  components.  General
loss percentages are calculated based upon historical  analyses.  A supplemental
portion of the allowance is calculated for inherent  losses which probably exist
as of the evaluation date even though they might not have been identified by the
more objective  processes used for the portion of the allowance described above.
This is due to the risk of error  and/or  inherent  imprecision  in the process.
This portion of the allowance is particularly  subjective and requires judgments
based on qualitative  factors which do not lend themselves to exact mathematical
calculations such as: trends in delinquencies and nonaccruals;  migration trends
in the  portfolio;  trends in  volume,  terms,  and  portfolio  mix;  new credit
products  and/or  changes  in the  geographic  distribution  of those  products;
changes in lending policies and procedures;  loan review reports on the efficacy
of the risk identification  process;  changes in the outlook for local, regional
and  national  economic  conditions;  concentrations  of credit;  and peer group
comparisons.

     Specific  allowances are provided in the event that the specific collateral
analysis  on  each  classified  loan  indicates  that  the  probable  loss  upon
liquidation  of  collateral  would  be  in  excess  of  the  general  percentage
allocation. The provision for loan loss is debited or credited in order to state
the allowance for loan losses to the required level as determined above.

                                       15
<PAGE>



       The following tables set forth an analysis of the Company's allowance for
loan losses at the dates indicated.
<TABLE>
<CAPTION>
                                                   Years Ended September 30,
                                                   -------------------------
                                          1999        1998       1997        1996       1995
                                          ----        ----       ----        ----       ----
                                                          (Dollars in thousands)
<S>                                     <C>         <C>        <C>         <C>         <C>
Balance at beginning of year...         $11,818     $11,691    $11,016     $10,083     $9,434
Provision for (recovery of)
    losses.....................             816         297        782        (76)        460
Allowance for loan losses
    acquired (1)...............             ---         ---        ---         885        ---
Charge-offs:
    Residential................            (22)       (259)       (43)       (137)      (109)
    Commercial real estate.....            (49)         ---       (91)         ---      (145)
    Consumer...................           (324)       (213)      (125)        (48)      (130)
    Other......................           (367)       (102)        (3)       (180)        ---
                                        -------      ------   --------        ----    -------
       Total charge-offs.......           (762)       (574)      (262)       (365)      (384)

Recoveries:
    Residential................              39          86         44         149        117
    Commercial real estate.....              21           2         19          86        270
    Consumer...................              14          16         62          79        133
    Other......................               6         300         30         175         53
                                        -------      ------   --------        ----    -------
       Total recoveries........              80         404        155         489        573
Balance at end of year.........         $11,952     $11,818    $11,691     $11,016    $10,083
                                        =======     =======    =======     =======    =======
Allowance for loan losses to total
    loans......................           1.12%       1.25%      1.40%       1.44%      1.60%
Allowance for loan losses to  total
    non-performing loans.......         470.31%     483.13%    453.11%     507.25%    286.70%
Allowance for loan losses and
    allowance for REO to total non-
    performing assets..........         346.20%     221.80%    224.21%     181.78%    146.32%
Net charge-offs (recoveries) to
    average loans outstanding during
    the period.................           0.07%       0.02%      0.01%     (0.02)%    (0.03)%
Classified loans to total net loans       0.48%       0.59%      1.19%       1.11%      2.78%
</TABLE>

(1)  Represents  allowance  acquired in conjunction with acquisition of Treasure
     Coast Bank, F.S.B in 1996.


                                       16
<PAGE>



     The following table presents an allocation of the entire allowance for loan
losses among various loan classifications and sets forth the percentage of loans
in each category to total loans.  The allowance shown in the table should not be
interpreted  as an indication  that  charge-offs in future periods will occur in
these amounts or proportions or that the analysis  indicates  future  charge-off
trends.


<TABLE>
<CAPTION>
                                                      September 30,
                              ---------------------------------------------------------------
                                   1999                 1998                   1997
                                   ----                 ----                   ----
                              Amount  Percent(1)    Amount Percent(1)    Amount    Percent(1)
                              ------  ----------    -----------------    ------    ----------
                                                 (Dollars in thousands)
Allowance at end of period
    applicable to:
<S>                          <C>       <C>         <C>       <C>        <C>          <C>
Residential................. $ 2,605   76.06%      $ 2,251   76.88%     $ 2,141      76.88%
Commercial real estate......   6,142   13.56         5,986   12.22        6,487      11.74
Consumer ...................   2,128    8.55         2,310    9.40        2,068      10.10
Commercial business.........   1,077    1.83         1,271    1.50          995       1.28
                               -----    ----         -----    ----       ------       ----
    Total................... $11,952  100.00%      $11,818  100.00%     $11,691     100.00%
                              ======  ======        ======  ======       ======     ======
</TABLE>

(1) Percent of loans in each category to total loans at the dates indicated.


Investment Activities

     The Company  invests  primarily in overnight  funds,  U.S.  Government  and
agency  obligations,  and Federal Home Loan Bank of Atlanta  capital stock.  The
Company does not invest in derivatives,  collateralized  mortgage obligations or
other hedging instruments.

     The table below summarizes the carrying value and estimated market value of
the Company's portfolio of investment securities at the dates indicated.


<TABLE>
<CAPTION>
                                                September 30,
                                                -------------
                                   1999                1998                 1997
                                   ----                ----                 ----
                                                   (In thousands)
                           Carrying    Market    Carrying   Market   Carrying   Market
                             Value      Value      Value     Value     Value     Value
  Available for sale:
<S>                         <C>         <C>       <C>        <C>     <C>       <C>
    Treasury notes......    $  ---      $ ---     $  ---     $ ---   $17,985   $17,985
    FHLB notes..........    49,502     49,502     50,721    50,721    29,486    29,486
    FNMA notes..........    19,875     19,875     20,343    20,343       ---       ---
    Equity securities...     6,789      6,789        452       452        82        82
                             -----      -----     ------    ------    ------    ------
        Total              $76,166    $76,166    $71,516   $71,516   $47,553   $47,553
                            ======     ======     ======    ======    ======    ======

  Held to maturity:
    FHLB notes..........     9,995      9,992     19,989    20,268     5,000     4,993
    FNMA notes..........       ---        ---     10,000    10,005       ---       ---
    Municipal securities       915        852        ---       ---       ---       ---
                             -----      -----     ------    ------    ------    ------
        Total...........   $10,910    $10,844    $29,989   $30,273   $ 5,000   $ 4,993
                            ======     ======     ======    ======    ======    ======

  FHLB stock............   $11,250    $11,250    $ 8,212   $ 8,212    $7,595    $7,595
</TABLE>

                                       17

<PAGE>

     The table below presents the  contractual  maturities and weighted  average
yields of investment  securities at September 30, 1999, excluding FHLB stock and
equity securities.
<TABLE>
<CAPTION>
                     One Year or Less      One to Five Years   More Than Five Years              Total InvestmentSecurities
                     ----------------      -----------------   --------------------    --------------------------------------------
                                                                 (Dollars in thousands)
                                                                                        Average
                              Weighted                Weighted             Weighted    Remaining                          Weighted
                   Carrying   Average     Carrying    Average   Carrying   Average     Years to     Carrying    Market     Average
                     Value     Yield       Value       Yield      Value     Yield      Maturity      Value      Value       Yield
                     -----     -----       -----       -----      -----     -----      --------      -----      -----       -----
<S>                  <C>        <C>        <C>         <C>       <C>        <C>           <C>        <C>        <C>          <C>
  FHLB Notes         $ 9,995    5.96%      $49,502     5.87%     $ ---      0.00%         1.9        $59,497    $59,494      5.89%
  FNMA Notes             ---    0.00        19,875     5.68        ---      0.00           .9         19,875     19,875      5.68
  Municipal
    Securities           ---    0.00           ---      .00        915      6.46         12.3            915        852      6.46
</TABLE>



Sources of Funds

     Deposits.  The  Company  offers a number  of  different  deposit  accounts,
including   regular   savings,   interest-bearing   checking  or  NOW  accounts,
non-interest  checking,  money market  deposit,  term  certificate  accounts and
individual retirement accounts.

     The Company has twenty-seven  full-service banking offices and one in-store
branch  location in addition to its home office in Fort  Pierce.  The  Company's
strategy has been to have conveniently  located offices in growth markets as one
of its main methods of attracting  funds. The Company's  deposits  primarily are
obtained from areas surrounding its offices.  Certificate  accounts in excess of
$100,000 are not actively solicited nor are brokers used to obtain deposits.

     During the  quarter  ending  December  31,  1999,  the  Company  will begin
offering internet banking services. This new online service will allow customers
the ability to access  their  accounts  through any computer  terminal  that has
internet  browser  capabilities,  using the most  secure  technology  available.
Customers  benefit by having access to their accounts and being able to initiate
transactions  at the time that suits them best.  The Company  also offers a bill
pay service.

     The Company had a decline in deposit  balances  for several  years prior to
1993.  This was a strategy that the Company used to improve its capital  ratios.
Much of the decline was accomplished by the closing of less profitable branches.
With the Company's  improved  capital position in the beginning of 1993, it made
an effort to stabilize  deposits and increase account balances.  As part of this
strategy,  the Company has upgraded a number of branch facilities and moved from
leased storefronts to full service free-standing offices.

     Management believes that demand and passbook accounts are less sensitive to
changes in interest rates than other types of accounts,  such as certificates of
deposit.  As of September  30,  1999,  the Company had 30.06% of its deposits in
passbook and demand  accounts,  68.67% in  certificates  of deposit and 1.27% in
official checks.  Due to the recent low interest rate  environment,  the Company
has also been pricing its  certificates  of deposit to encourage  lengthening of
maturities.  When  management  determines  the  levels  of  its  deposit  rates,
consideration is given to local competition, U.S. Treasury securities offerings,
and anticipated funding requirements.


                                       18
<PAGE>



     The following table sets forth the  distribution  of the Company's  deposit
accounts at the dates indicated and the weighted  average interest rates on each
category  of deposits  presented.  Management  does not believe  that the use of
year-end  balances  instead of average  monthly  balances  produces any material
difference in the information presented:


<TABLE>
<CAPTION>
                                                                September 30,
                                                                -------------
                                         1999                          1998                       1997
                                         -----                         -----                      ----
                                               Weighted                      Weighted                        Weighted
                                                Average                       Average                        Average
                                                Nominal                       Nominal                        Nominal
                              Amount   Percent   Rate      Amount   Percent    Rate      Amount    Percent    Rate
                              ------   -------   ----      ------   -------    ----      ------    -------    ----
                                                             (Dollars in thousands)
 <S>                        <C>        <C>        <C>     <C>      <C>       <C>        <C>        <C>         <C>
Demand accounts:
   Non-interest
    Bearing demand          $ 76,176     7.79%     N/A    $ 54,954   5.99%     N/A      $ 40,749     4.47%     N/A
   NOW accounts               66,184     6.77     1.09%     60,129   6.55     1.13%       52,045     5.71      1.32%
   Money market accounts      43,015     4.40     2.49      41,074   4.46     2.54        43,401     4.76      2.51
                              ------     ----     ----      ------   ----     ----        ------     ----      ----
   Subtotal                  185,375    18.96      .97     156,157  17.00     1.10       136,195    14.94      1.30
 Savings accounts:
   Passbook                  108,508    11.10     1.97      92,698  10.10     2.06        76,540     8.40      1.69
   Certificates of deposit   671,281    68.67     5.03     658,842  71.76     5.43       689,760    75.67      5.47
   Official checks            12,431     1.27      N/A      10,429   1.14      N/A         9,081      .99       N/A
                              ------     ----     ----     ------   ----      ----        -----       ---      ----
   Total deposits           $977,595   100.00%    3.86%   $918,126 100.00%    4.29%     $911,576   100.00%     4.47%
                            ========   ======     ====    ======== ======     ====      ========   ======      ====
</TABLE>


    The following table presents, by various categories,  information concerning
the amounts and maturities of the Company's time deposits.


                                             September 30,
                           ----------------------------------------------------
                              1999                1998                1997
                              ----                ----                ----
                                         (Dollars in thousands)
  0.00 - 3.00%.............      $ 128           $ 328               $ 545
  3.01 - 4.00%.............     11,275              --                  --
  4.01 - 5.00%.............    335,421          84,192              88,472
  5.01 - 6.00%.............    298,720         540,209             553,986
  6.01 - 7.00%.............     25,361          33,674              46,333
  7.01 - 8.00%.............        376             434                 424
  8.01 - 9.00%.............        ---               5                 ---
                              --------      ----------             -------
Total Certificate Accounts.   $671,281        $658,842            $689,760
                              ========        ========            ========

                                       19
<PAGE>


    At September 30, 1999, the Company had certificates of deposit in amounts of
$100,000 or more maturing as follows:


                                           Amount
Maturity Period                        (In thousands)
3 Months or Less...................        $ 15,374
Over 3 to 6 Months.................          16,025
Over 6 to 12 Months................          14,939
Over 12 Months.....................          22,584
                                             ------
Total..............................         $68,922
                                            =======

    The following table contains information  regarding deposit account activity
for the periods shown.


<TABLE>
<CAPTION>
                                                                     Years Ended September 30,
                                                     -------------------------------------------------
                                                          1999             1998                 1997
                                                          ----             -------              ----
                                                                      (Dollars in thousands)
<S>                                                    <C>               <C>                   <C>
Net increase (decrease) before interest credited      $ 25,933          $ (28,838)            $ 25,563
Interest credited                                       33,536             35,388               34,160
                                                        ------             ------               ------
Deposit account increase                               $59,469            $ 6,550             $ 59,723
                                                       =======            =======             ========

Weighted average cost of deposits during the year        3.96%               4.35%               4.42%
Weighted average cost of deposits at end of year         3.86%               4.29%               4.47%
</TABLE>


      Borrowings.  The  Company  is a member  of the  Federal  Home Loan Bank of
Atlanta  ("FHLB of Atlanta").  The FHLB of Atlanta offers various fixed rate and
variable  rate  advances to its members.  Requests for advances with an original
term to maturity of five years or less may be  approved  for any sound  business
purpose in which the member is authorized to engage.  Requests for advances with
original  maturity in excess of five years may be approved  only for the purpose
of enabling that member to provide funds for residential  housing  finance.  The
FHLB of Atlanta  underwrites  each  advance  request  based on  factors  such as
adequacy and stability of capital  position,  quality and composition of assets,
liquidity  management,  level of  borrowings  from all  sources  and other  such
factors.  Pursuant to a collateral agreement with the FHLB, advances are secured
by all stock in the FHLB and a blanket  floating  lien that requires the Company
to maintain  qualifying first mortgage loans as pledged  collateral in an amount
equal to, when discounted at 75% of the unpaid principal balances, the advances.

      As of September 30, 1999, the Company had $225 million of outstanding FHLB
advances.  Of this amount,  all have  remaining  maturity  dates of  twenty-four
months or longer.

     As of  September  30,  1999,  the Company had a total  credit limit of $364
million and an availability limit of $139 million with the FHLB of Atlanta.

                                       20

<PAGE>

      In addition to FHLB advances,  the Company had $195.7 million of unpledged
mortgage-backed    securities   at   September   30,   1999.   These   unpledged
mortgage-backed  securities could be used as collateral under reverse repurchase
transactions with various security dealers.  Such borrowing  transactions  could
provide  additional  cash and liquidity to the Company in the event of sudden or
unforeseen deposit withdrawals.

      The Company  recognizes the maturity  characteristics  of its time deposit
portfolio.  Management  believes that unused FHLB  advances and other  borrowing
sources would provide sufficient funding for potential deposit withdrawals.


      The  following  table  sets  forth  information  regarding  the  Company's
borrowing at and for the periods indicated:


<TABLE>
<CAPTION>
                                                                     At or for the Year Ended September 30,
                                                                       1999        1998         1997
                                                                       ----        ----         ----
                                                                           (Dollars in thousands)
       FHLB Advances:
<S>                                                                 <C>          <C>          <C>
             Average Balance............................            $197,767     $104,877     $ 99,342
             Maximum balance at any month-end...........             225,000      145,000      110,000
             Balance at year end........................             225,000      145,000      100,000
             Weighted average interest rate during the year            5.62%        6.12%        6.00%
             Weighted average interest rate at year end.               5.56%        5.76%        6.00%
       Other Borrowings:
             Average Balance............................              $  ---        $ 167        $ 561
             Maximum balance at any month-end...........                 ---          475          674
             Balance at year end........................                 ---          ---          475
             Weighted average interest rate during the year              ---       11.98%        9.48%
             Weighted average interest rate at year end.                 ---          ---        7.12%
       Total Borrowings:
             Average Balance............................            $197,767     $105,044      $99,903
             Maximum balance at any month-end...........             225,000      145,000      110,674
             Balance at year end........................             225,000      145,000      100,475
             Weighted average interest rate during the year            5.62%        6.13%        6.02%
             Weighted average interest rate at year end.               5.56%        5.76%        6.01%
</TABLE>


                                       21
<PAGE>

Subsidiaries

     Federal  associations  generally  may  invest  up to 2% of their  assets in
service corporations plus an additional 1% of assets for community purposes.  In
addition,  federal  associations  such as the Bank may invest up to 50% of their
regulatory capital in conforming loans to service  corporations.  In addition to
investments  in service  corporations,  federal  associations  are  permitted to
invest  an  unlimited  amount  in  operating   subsidiaries  engaged  solely  in
activities that a federal association may engage in directly.

     The Bank has two active subsidiary  corporations.  Appraisal Analysts, Inc.
provides real estate appraisal services to the Bank as well as third parties. H.
F.  Development  Company,  Inc. serves as a repository for some of the Company's
commercial REO  properties  held for  disposition.  See "Business -- Delinquent,
Nonperforming and Classified Assets".
Competition

     The Company encounters strong  competition both in attracting  deposits and
in originating real estate and consumer loans.  Its most direct  competition for
deposits has come historically from commercial  banks,  brokerage houses,  other
savings  associations  and credit unions in its market area. The Company expects
continued strong competition from such financial institutions in the foreseeable
future.  The Company's  market area includes  branches of a number of commercial
banks that are  substantially  larger  than the  Company  in terms of  statewide
deposits.  The Company competes for deposits by offering depositors a high level
of personal service, convenient locations and a competitive interest rate.

     The  competition  for real estate and other loans  comes  principally  from
commercial  banks,  mortgage banking  companies and other savings  associations.
Lending competition has increased  substantially in recent years, as a result of
the large  number of  institutions  seeking  to  benefit  from the growth in the
Company's market area.

     The Company  competes for loans  primarily  through the interest  rates and
loan fees it  charges,  the types of loans it  offers,  and the  efficiency  and
quality of services it provides  borrowers,  real estate  brokers and  builders.
Factors that affect competition  include general and local economic  conditions,
current  interest rate levels and volatility of the mortgage  markets.  Based on
total  assets,  as of September  30, 1999,  the Company was the largest  savings
institution headquartered in the six county area served by the Company.

Employees

     At September 30, 1999,  the Company had a total of 366 full-time  employees
and 99  part-time  employees,  none of whom  were  represented  by a  collective
bargaining  unit.  The Company  considers its relations with its employees to be
good.
                                       22

<PAGE>

Financial Services Modernization Bill

     On   November   12,   1999,   President   Clinton   signed   into  law  the
Gramm-Leach-Bliley-Financial  Services  Modernization  Act of 1999 (the  "Act"),
federal  legislation  intended to modernize the financial  services  industry by
establishing a comprehensive  framework to permit  affiliations among commercial
banks,  insurance  companies,  securities  firms  and  other  financial  service
providers.  Generally,  the Act:  (i) repeals the  historical  restrictions  and
eliminates  many  federal and state law  barriers to  affiliations  among banks,
securities firms,  insurance  companies and other financial  service  providers;
(ii)  provides  a  uniform  framework  for  the  functional  regulation  of  the
activities of banks,  savings  institutions and their holding  companies;  (iii)
broadens  the  activities  that may be  conducted  by  national  banks,  banking
subsidiaries of bank holding  companies and their financial  subsidiaries;  (iv)
provides  an  enhanced   framework  for   protecting  the  privacy  of  consumer
information;  (v) adopts a number of provisions  related to the  capitalization,
membership,  corporate  governance and other measures  designed to modernize the
Federal  Home  Loan  Bank  system;   (vi)   modifies  the  laws   governing  the
implementation of the Community  Reinvestment Act; and (vii) addresses a variety
of other  legal  and  regulatory  issues  affecting  day-to-day  operations  and
long-term activities of financial institutions.

     Thrift holding companies such as the Company will be permitted to engage in
financial  activities in the same manner as bank holding  companies with respect
to insurance and securities activities. In addition, in a change from prior law,
thrift holding companies can be owned,  controlled or acquired only by companies
engaged in financially-related activities.

     The  Company  does not  believe  that the Act will have a material  adverse
effect on its operations in the near-term.  However,  to the extent that the Act
permits  banks,  securities  firms and  insurance  companies to  affiliate,  the
financial  services industry may experience  further  consolidation.  This could
result in a growing  number of larger  financial  institutions  that can offer a
wider variety of financial  services than the Company  currently offers and that
can aggressively compete in the markets the Company currently serves.

Item 2.  Properties

     The Company  conducts its business from its headquarters in Fort Pierce and
through 27 full-service  banking  offices,  one loan  production  office and one
in-store branch  location.  These offices are located in Brevard,  Indian River,
Martin, Okeechobee, St. Lucie, and Volusia counties, Florida. The net book value
at September 30, 1999 of the Company's offices was $15.6 million.  The following
table sets forth information regarding the Company's offices.

                                       23
<PAGE>

<TABLE>
<CAPTION>
                                                   Year                                              Lease
                 Location                         Opened               Owned/Leased             Expiration Date
                 --------                         ------               ------------             ---------------


ST. LUCIE COUNTY
----------------
<S>                                                <C>                    <C>                    <C>
MAIN OFFICE                                        1934                   OWNED
100 SOUTH SECOND STREET
FORT PIERCE, FL 34950

VIRGINIA AVENUE                                    1968                   OWNED
500 VIRGINIA AVENUE
FORT PIERCE, FL 34950

PSL MAIN                                           1975                   OWNED
7181 SOUTH U.S. #1
PORT ST. LUCIE, FL 34952

H.F. CENTER                                        1981                   OWNED
2400 S.E. MIDPORT RD., SUITE 300
PORT ST. LUCIE, FL 34952

LAKEWOOD PARK                                      1981                   OWNED
5100 TURNPIKE FEEDER RD.
FORT PIERCE, FL 34951

DARWIN SQUARE                                      1991                   OWNED
3201 S.W. PSL BLVD.
PORT ST. LUCIE, FL 34953

ORANGE BLOSSOM                                     1984                   OWNED
4156 OKEECHOBEE ROAD
FORT PIERCE, FL 34947

ST. LUCIE WEST                                     1993                   OWNED
1320 S.W. ST. LUCIE WEST BLVD.
PORT ST. LUCIE, FL 34986

INDIAN RIVER
------------
VERO MAIN                                          1978                   OWNED
655 21st STREET
VERO BEACH, FL 32960

CAUSEWAY                                           1981                   OWNED
1700 S.A1A
VERO BEACH, FL 32963

INDIAN RIVER MALL                                  1997                   OWNED
6080 20TH ST.
VERO BEACH, FL 32966

SEBASTIAN                                          1979                   OWNED
13397 U.S. HIGHWAY #1
SEBASTIAN, FL 32958

WEST SEBASTIAN                                     1998                   OWNED
993 FELLSMERE ROAD
SEBASTIAN, FL 32958

MARTIN COUNTY
-------------
PALM CITY                                          1978                   LEASED                    07/26/05
1251 S.W. 27TH STREET
PALM CITY, FL  34990

EAST OCEAN                                         1981                   OWNED
1500 E. OCEAN BLVD.
STUART, FL 34996

STUART MAIN                                        1996                   LEASED                    08/14/01
789 S. FEDERAL HWY.
STUART, FL 34994

JENSEN BEACH                                       1999                   LEASED                    04/30/02
3639 NW FEDERAL HWY.
JENSEN BEACH, FL  34957


                                       24
<PAGE>

BREVARD COUNTY
--------------
PALM BAY                                           1981                   OWNED
5245 BABCOCK ST., N.E.
PALM BAY, FL 32905

INDIALANTIC                                        1981                   OWNED
305 5th AVENUE
INDIALANTIC, FL 32903

WEST MELBOURNE                                     1982                   OWNED
2950 W. NEW HAVEN AVENUE
MELBOURNE, FL 32904

VIERA                                              1995                   OWNED
100 CAPRON TRAIL
MELBOURNE, FL  32940

WAL-MART                                           1998                   LEASED                    08/31/03
1000 N  WICKHAM ROAD
MELBOURNE, FL 32935

LOAN PRODUCTION OFFICE                             1998                   LEASED                    10/10/99
2460 N COURTENAY PARKWAY
   SUITE 107
MERRITT ISLAND, FL 32953

OKEECHOBEE COUNTY
-----------------
OKEECHOBEE                                         1980                   OWNED
2801 HIGHWAY #441 SOUTH
OKEECHOBEE, FL 34974

VOLUSIA COUNTY
--------------
NEW SMYRNA BEACH                                   1988                   LEASED                    09/30/99
REGIONAL SHOPPING CENTER
1940 STATE ROAD #44
NEW SMYRNA BEACH, FL 32168

PORT ORANGE                                        1983                   OWNED
4035 NOVA ROAD
PORT ORANGE, FL 32127

ORMOND BEACH                                       1984                   OWNED
75 N. NOVA ROAD
ORMOND BEACH, FL 32174

DELTONA                                            1998                   OWNED
2901 HOWLAND BOULEVARD
DELTONA, FL 32725

DELAND
312 N. WOODLAND BOULEVARD                          1999                   OWNED
DELAND, FL  32720

ORMOND BY THE SEA
1190 OCEAN SHORE BOULEVARD                         1999                   OWNED
ORMOND BEACH, FL  32176
</TABLE>

                                       25
<PAGE>

      All leases are anticipated to renew upon their expiration.

      The Company uses a data processing service located in Orlando, Florida for
record keeping activities.  The data processor  specializes in servicing savings
associations.   The  Company's  current  contract  expires  in  2002.  All  data
processing  equipment  that is used  internally  by the  Company is owned by the
Company.  The net book  value of such  data  processing  equipment  and  related
software as of September 30, 1999 was $2,731,000.

Item 3.  Legal Proceedings

      There are various claims and lawsuits in which the Company is periodically
involved incident to the Company's  business.  In the opinion of management,  no
material loss is anticipated from any such pending claims or lawsuits.

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

      None.


                                     PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters.

      The Company's  common stock trades on the NASDAQ National Market under the
symbol HARB. The  approximate  number of  shareholders  of record and beneficial
shareholders  of the common  stock at December 8, 1999 was 9,143,  some of which
are street name holders.

      The Company paid $0.29 in cash  dividends  per share for the twelve months
ended in fiscal 1999.  Payments  were $0.065 in the first  quarter and $0.075 in
the second,  third and fourth  quarters.  The  Company  currently  expects  that
comparable cash dividends will continue to be paid in the future.

      On December 10, 1999 the closing sales price of the Company's common stock
was $12.6875 per share.  The  following  table sets forth the price range of the
high and low closing  sales  price per share of common  stock as reported by the
NASDAQ stock market for the four quarters of fiscal year 1999 and 1998.

      On March 18, 1998, the conversion and  reorganization of Harbor Financial,
M.H.C. was  consummated.  Pursuant to this  transaction,  the Company became the
stock  holding  company for the Bank and Harbor  Financial,  M.H.C.,  the Bank's
mutual holding company,  ceased to exist.  Each existing share of Harbor Florida
Bancorp,  Inc.,  except for those shares held by Harbor  Financial,  M.H.C. were
exchanged  for 6.0094 shares of the Company.  The prices in the following  table
have been adjusted to reflect this transaction.


                                                    Low $             High $
                                                    -----             ------
FISCAL 1999
   First Quarter................                     8.75              11.25
   Second Quarter ..............                    10.69              12.75
   Third Quarter................                    11.44              13.69
   Fourth Quarter...............                    11.94              13.00
FISCAL 1998
   First Quarter................                     9.29              11.61
   Second Quarter ..............                    10.65              12.56
   Third Quarter................                    11.63              12.81
   Fourth Quarter...............                     9.31              13.56

                                       26

<PAGE>

Item 6. Selected Financial Data.

      The information  contained in the table captioned  "Selected  Consolidated
Financial  Data" in the Annual Report on pages 11-12 is  incorporated  herein by
reference.

Item 7. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations.

      The  information   contained  in  the  section   captioned   "Management's
Discussion  and Analysis of Financial  Condition and Results of  Operations"  on
pages 12 through 24 in the Annual Report is incorporated herein by reference.

Item 7A.  Quantitative and Qualitative Disclosures about Market Risk

      The information contained in the sections captioned "Market Risk and Asset
and Liability Management", "Interest Rate Sensitivity", "Interest Rate Risk" and
"Equity Risk" on pages 13 through 15 in the Annual Report is incorporated herein
by reference.

Item 8.  Financial Statements and Supplementary Data

      The Company's  consolidated financial statements listed in Item 14 herein,
together with the report  thereon by KPMG LLP, are found in the Annual Report on
pages 25 through 55 and incorporated herein by reference.


Item 9.  Changes  in  and  Disagreements  with  Accountants  on  Accounting  and
     Financial Disclosure.

      None.



                                    PART III

Item 10. Directors and Executive Officers of the Registrant.

      The  information   contained  under  the  sections  captioned  "Beneficial
Ownership of Common Stock," on pages 2 through 4 and "Section  16(A)  Beneficial
Ownership Reporting Compliances" on page 13 through 14 in the Proxy Statement of
Harbor Florida  Bancshares,  Inc. (the "Proxy  Statement)  filed with the SEC on
December 15, 1999 is incorporated herein by reference.



Item 11.  Executive Compensation.

     The  information   contained  under  the  sections   captioned   "Executive
Compensation" on pages 8 through 13 in the Proxy Statement filed with the SEC on
December 15, 1999 is incorporated herein by reference.


                                       27

<PAGE>

Item 12.  Security Ownership of Certain Beneficial Owners and Management.

   (a)  Security Ownership of Certain Beneficial Owners

      The information required by this item under the sections captioned "Voting
Securities" on pages 1 through 2 and  "Beneficial  Ownership of Common Stock" on
pages 2 through 4 in the Proxy Statement filed with the SEC on December 15, 1999
is incorporated herein by reference.


   (b)  Security Ownership of Management

      The  information  required  by  this  item  under  the  section  captioned
"Beneficial Ownership of Common Stock" in the Proxy Statement filed with the SEC
on December 15, 1999 is incorporated herein by reference.


   (c)  Changes in Control

     Management of the Company knows of no arrangements, including any pledge by
any persons of  securities  of the  Company,  the  operation  of which may, at a
subsequent date, result in a change in control of the Registrant.


Item 13.  Certain Relations and Related Transactions

      The information required by this item under the sections captioned "Voting
Securities"  on pages 1 through 2,  "Beneficial  Ownership  of Common  Stock" on
pages 2 through 4 and "Certain  Transactions"  on page 13 in the Proxy Statement
filed with the SEC on December 15, 1999 is incorporated herein by reference.

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

     (a)Documents filed as a part of this Report:

     (1)  The Consolidated  Financial  Statements of the Registrant are attached
          and are listed below:

                                                             Pages in Annual
                                                                 Report
                                                                 ------
   Independent Auditors' Report                                   17
   Consolidated Statements of Financial Condition                 18
   Consolidated Statements of Earnings                            19
   Consolidated Statements of Stockholders' Equity
     and Comprehensive Income                                     20
   Consolidated Statements of Cash Flow                           22
   Notes to Consolidated Financial Statements                     24

     (2)  The Consolidated  Financial  Statement  Schedules of the Registrant as
          required to be filed in this Report are either not  applicable  or are
          included elsewhere in this Report.

                                       28
<PAGE>

     (3)  Exhibit Index

      The  exhibits   listed  below  are  included   with  this  Report  or  are
incorporated  herein by reference to the identified  document  previously  filed
with the Securities and Exchange Commission as set forth parenthetically.
<TABLE>
<S>     <C>

3(i)     Certificate  of  Incorporation  of Registrant  (Exhibit 3.3 to  Pre-effective  Amendment  No. 1 to the  Registration
         Statement on Form S-1, No. 333-37275 filed November 10, 1997).

3(ii)    Bylaws of Registrant.  (Exhibit 3.4 to Pre-Effective  Amendment No. 1 to the Registration Statement on Form S-1, No.
         333-37275, filed November 10, 1997).

10(i)    Employment  contract  with Michael J. Brown,  Sr.  (Exhibit  10(a) to the  Registration  Statement on Form S-4 filed
         December 20, 1996)

10(ii)   1994 Incentive Stock Option Plan (Exhibit 10(b) to the Registration Statement on Form S-4 filed December 20, 1996)

10(iii)  1994 Stock  Option  Plan for  Outside  Directors  (Exhibit  10(c) to the  Registration  Statement  on Form S-4 filed
         December 20, 1996)

10(iv)   Harbor Federal  Savings Bank  Non-Employee  Directors'  Retirement Plan (Exhibit 10(vi) to Form 10-Q for the quarter
         ended June 30, 1997 filed August 11, 1997)

10(v)    Unfunded  Deferred  Compensation  Plan for Directors  (Exhibit 10(vii) to Form 10-K for the year ended September 30,
         1998 filed December 24, 1998)

10(vi)   Change of Control  Agreements  (Exhibit 10(x) to Form 10-K for the year ended  September 30, 1998 filed December 24,
         1998)

21       Subsidiaries of the Registrant

27       Financial Data Schedule

99       Consolidated  Financial  Statements of the Registrant  (Annual Report to Stockholders  for fiscal
         year September 30, 1999)
</TABLE>

(b)   Reports on Form 8-K

      None.


                                       29
<PAGE>


                                   SIGNATURES


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


                                                 HARBOR FLORIDA BANCSHARES, INC.
                                                                    (Registrant)



Dated: December 27, 1999                     By:              /s/
                                             ----------------------------------
                                             Michael J. Brown, Sr.
                                             President and Chief Executive
                                             Officer and Director


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 date indicated.


             /s/                                           December 27, 1999
---------------------------------------------
Michael J. Brown, Sr.
President, Chief Executive
Officer and Director


             /s/                                           December 27, 1999
---------------------------------------------
Don W. Bebber
Senior Vice President, Finance
(Principal Financial and Accounting Officer)


              /s/                                          December 27, 1999
---------------------------------------------
Bruce R. Abernethy, Sr., Director


              /s/                                          December 27, 1999
---------------------------------------------
Richard K. Davis, Director


              /s/                                          December 27, 1999
---------------------------------------------
Edward G. Enns, Director


              /s/                                          December 27, 1999
---------------------------------------------
Frank H. Fee, III, Director


              /s/                                          December 27, 1999
---------------------------------------------
Richard B. Hellstrom, Director


              /s/                                          December 27, 1999
---------------------------------------------
Richard N. Bird, Director