##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

| |          |  |                                                                                                                    |  | 
| | -------- |  | ------------------------------------------------------------------------------------------------------------------ |  | 
| | MARK ONE |  |                                                                                                                   
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| | (XBox)   |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934                           
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| |          |  |                                                                                                                   
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| |          |  | FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2002                                                                     
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| |          |  |                                                                                                                   
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| | (Box)    |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD
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| |          |  |                                                                                                                   
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| |          |  | FROM  TO                                                                                                          

Commission File Number 2-90200

FIRST MCMINNVILLE CORPORATION

(Exact Name of Registrant As Specified in its Charter)


|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Tennessee                                                      |  | 62-1198119                          
|                                                               |  |                                     
|(State or Other Jurisdiction of
Incorporation or Organization) |  | (IRS Employer
Identification Number)

200 East Main Street, McMinnville, TN 37110

(Address of Principal Executive Offices and Zip Code)


(931) 473-4402

(Registrants Telephone Number, including area code)


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 (XBox)       NO (Box)

Indicate the number of shares outstanding of each of the issuers classes of
common stock, as of the latest practicable date.

|                          |  |                               
|------------------------- |  | ------------------------------
|Common stock outstanding: |  | 519,020 shares at May 14, 2002

1



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TABLE OF CONTENTS



|                              |                                                                                               |                                                                                              |  |  |  |  |  | 
|----------------------------- | --------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------- |  |  |  |  |  | 
|PART I. FINANCIAL INFORMATION
|                              | Item 1. Financial Statements                                                                 
|                              |                                                                                               | Consolidated Balance Sheets March 31, 2002 and December 31, 2001                            
|                              |                                                                                               | Consolidated Statements of Earnings Three Months Ended March 31, 2002 and 2001              
|                              |                                                                                               | Consolidated Statements of Comprehensive Earnings Three Months Ended March 31, 2002 and 2001
|                              |                                                                                               | Consolidated Statements of Cash Flows Three Months Ended March 31, 2002 and 2001            
|                              | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations



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##### Table of Contents











|PART I: |  | FINANCIAL INFORMATION
|------- |  | ---------------------
|       
|Item 1. |  | Financial Statements 

The unaudited consolidated financial statements of the registrant and its
wholly-owned subsidiary, First National Bank of McMinnville (Bank) and the
Banks wholly-owned subsidiary, First Community Title and Escrow Company, are
as follows:



| |  | Consolidated Balance Sheets  March 31, 2002 and December 31, 2001.                                    
| |  | -------------------------------------------------------------------------------------------------------
|
| |  | Consolidated Statements of Earnings  For the three months ended March 31,
2002 and 2001.              
|
| |  | Consolidated Statements of Comprehensive Earnings  For the three months
ended March 31, 2002 and 2001.
|
| |  | Consolidated Statements of Cash Flows  For the three months ended March
31, 2002 and 2001.            
|

|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations
|------- |  | -------------------------------------------------------------------------------------
|       
|Item 3. |  | Quantitative and Qualitative Disclosures About Market Risk                           



| |  |  | Disclosures required by Item 3 are incorporated by reference to
Managements Discussion and Analysis of Financial Condition and
Results of Operations.
| |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------





2



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##### Table of Contents






FIRST MCMINNVILLE CORPORATIONConsolidated Balance Sheets

March 31, 2002 and December 31, 2001

(Unaudited)

|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |        |         | 
|---------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ------- | -------------- | ------- | ------------ | ------- | ------ | ------- | 
|                                                                             |                                                                                                                           |                                            |         | March 31,      |         | December 31,
|                                                                             |                                                                                                                           |                                            |         | 2002           |         | 2001        
|                                                                             |                                                                                                                           |                                            |         |                |         |             
|                                                                             |                                                                                                                           |                                            |         | (In Thousands)
|Assets                                                                       |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Loans                                                                        |                                                                                                                           | $                                          | 141,340 |                |         |              | 140,731 |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Less: Allowance for loan losses                                                                                           |                                            |         | (1,834         | )       |              |         | (1,804 | )      
|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                             |                                                                                                                           | Net loans                                  |         |                | 139,506 |              |         |        | 138,927 | 
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Securities:                                                                  |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Held to maturity, at cost (market value  $60,454,000 and
$64,588,000, respectively)                                      |                                            |         | 60,042         |         |              |         | 63,879 |        
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Available-for-sale, at market (amortized cost  $62,444,000
and $67,579,000, respectively)                                |                                            |         | 61,458         |         |              |         | 67,648 |        
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Federal funds sold                                                           |                                                                                                                           |                                            | 8,500   |                |         |              |        |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Interest bearing deposits in financial institutions                          |                                                                                                                           |                                            | 105     |                |         |              | 179     |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Other earning assets                                                         |                                                                                                                           |                                            | 1,160   |                |         |              | 1,156   |       
|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                             |                                                                                                                           | Total earning assets                       |         |                | 270,771 |              |         |        | 271,789 | 
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Cash and due from banks                                                      |                                                                                                                           |                                            | 6,878   |                |         |              | 7,046   |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Bank premises and equipment, net of accumulated depreciation                 |                                                                                                                           |                                            | 2,022   |                |         |              | 2,071   |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Accrued interest receivable                                                  |                                                                                                                           |                                            | 2,181   |                |         |              | 2,147   |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Deferred tax asset                                                           |                                                                                                                           |                                            | 552     |                |         |              | 152     |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Other real estate                                                            |                                                                                                                           |                                            | 154     |                |         |              | 100     |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Other assets                                                                 |                                                                                                                           |                                            | 453     |                |         |              | 416     |       
|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                             |                                                                                                                           | Total assets                               |         | $              | 283,011 |              |         |        | 283,721 | 
|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |       
|Liabilities and Stockholders Equity                                         |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Deposits                                                                     |                                                                                                                           | $                                          | 218,579 |                |         |              | 213,275 |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Securities sold under repurchase agreements                                  |                                                                                                                           |                                            | 19,224  |                |         |              | 19,921  |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Federal funds purchased                                                      |                                                                                                                           |                                            |        |                |         |              | 5,000   |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Advances from Federal Home Loan Bank                                         |                                                                                                                           |                                            | 1,000   |                |         |              | 1,000   |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Accrued interest and other liabilities                                       |                                                                                                                           |                                            | 2,110   |                |         |              | 3,145   |       
|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                             |                                                                                                                           | Total liabilities                          |         |                | 240,913 |              |         |        | 242,341 | 
|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |       
|Stockholders equity:                                                        |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Common stock, $2.50 par value; authorized 5,000,000 shares,
issued 611,215 shares                                         |                                            |         | 1,528          |         |              |         | 1,528  |        
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Additional paid-in capital                                                                                                |                                            |         | 1,869          |         |              |         | 1,869  |        
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Retained earnings                                                                                                         |                                            |         | 43,083         |         |              |         | 41,703 |        
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Net unrealized gains (losses) on available-for-sale securities, net
of income taxes of $374,000 and $26,000, respectively |                                            |         | (612           | )       |              |         | 43     |        
|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                             |                                                                                                                           |                                            | 45,868  |                |         |              | 45,143  |       
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Less cost of treasury stock of 90,357 shares and 90,277 shares,
respectively |                                                                                                                           |                                            | (3,770  | )              |         |              | (3,763  | )     
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                           | Total stockholders equity                 |         |                | 42,098  |              |         |        | 41,380  | 
|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |       
|                                                                             |                                                                                                                           | Total liabilities and stockholders equity |         | $              | 283,011 |              |         |        | 283,721 | 
|                                                                             |                                                                                                                           |                                            |         |                |         |              |         |       

See accompanying notes to consolidated financial statements (unaudited).

3



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FIRST MCMINNVILLE CORPORATIONConsolidated Statements of Earnings

Three Months Ended March 31, 2002 and 2001
(Unaudited)

|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |       |       |       | 
|--------------------------------- | --------------------------------------------------------------------------------- | -------------------------------- | --------------------------------------------------- | ----- | ------------------------ | ----- | ----- | ----- | ----- | ----- | 
|                                  |                                                                                   |                                  |                                                     |       | 2002                     |       | 2001 
|                                  |                                                                                   |                                  |                                                     |       |                          |       |      
|                                  |                                                                                   |                                  |                                                     |       | (Dollars In Thousands   
|                                  |                                                                                   |                                  |                                                     |       | Except Per Share Amount)
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                 
|                                 
|                                 
|                                 
|Interest income:                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest and fees on loans                                                        |                                  | $                                                   | 2,675 |                          |       |       | 2,828 |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest and dividends on securities:                                             |                                  |                                                     |       |                          |       |       |       |      
|                                 
|                                 
|                                 
|                                 
|                                  |                                                                                   | Taxable securities               |                                                     |       | 1,313                    |       |       |       | 1,682 |      
|                                 
|                                 
|                                 
|                                 
|                                  |                                                                                   | Exempt from Federal income taxes |                                                     |       | 453                      |       |       |       | 358   |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest on federal funds sold                                                    |                                  |                                                     | 10    |                          |       |       | 33    |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest on interest-bearing deposits in other banks and other
interest           |                                  |                                                     |      |                          |       |       | 1     |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                  |                                                                                   |                                  | Total interest income                               |       |                          | 4,451 |       |       |       | 4,902 | 
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|Interest expense:                 |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest on negotiable order of withdrawal accounts                               |                                  |                                                     | 112   |                          |       |       | 185   |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest on money market demand and savings accounts                              |                                  |                                                     | 193   |                          |       |       | 275   |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest on certificates of deposit                                               |                                  |                                                     | 1,237 |                          |       |       | 2,080 |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest on securities sold under repurchase agreements and
short term borrowings |                                  |                                                     | 109   |                          |       |       | 163   |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest on Federal funds purchased                                               |                                  |                                                     | 10    |                          |       |       | 27    |      
|                                 
|                                 
|                                 
|                                 
|                                  | Interest on advances from Federal Home Loan Bank                                  |                                  |                                                     | 14    |                          |       |       | 14    |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                  |                                                                                   |                                  | Total interest expense                              |       |                          | 1,675 |       |       |       | 2,744 | 
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                  |                                                                                   |                                  | Net interest income                                 |       |                          | 2,776 |       |       |       | 2,158 | 
|                                 
|                                 
|                                 
|                                 
|Provision for loan losses         |                                                                                   |                                  | 44                                                  |       |                          |       | 45    |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                  |                                                                                   |                                  | Net interest income after provision for loan losses |       |                          | 2,732 |       |       |       | 2,113 | 
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|Non-interest income:              |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                 
|                                 
|                                 
|                                 
|                                  | Service charges on deposit accounts                                               |                                  |                                                     | 111   |                          |       |       | 122   |      
|                                 
|                                 
|                                 
|                                 
|                                  | Other fees and commissions                                                        |                                  |                                                     | 90    |                          |       |       | 56    |      
|                                 
|                                 
|                                 
|                                 
|                                  | Commissions and fees on fiduciary activities                                      |                                  |                                                     | 13    |                          |       |       | 15    |      
|                                 
|                                 
|                                 
|                                 
|                                  | Securities gains                                                                  |                                  |                                                     | 3     |                          |       |       |      |      
|                                 
|                                 
|                                 
|                                 
|                                  | Other income                                                                      |                                  |                                                     | 11    |                          |       |       | 7     |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                  |                                                                                   |                                  | 228                                                 |       |                          |       | 200   |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|Non-interest expense:             |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                 
|                                 
|                                 
|                                 
|                                  | Salaries and employee benefits                                                    |                                  |                                                     | 681   |                          |       |       | 685   |      
|                                 
|                                 
|                                 
|                                 
|                                  | Occupancy expenses, net                                                           |                                  |                                                     | 51    |                          |       |       | 49    |      
|                                 
|                                 
|                                 
|                                 
|                                  | Furniture and equipment expense                                                   |                                  |                                                     | 13    |                          |       |       | 17    |      
|                                 
|                                 
|                                 
|                                 
|                                  | Data processing expense                                                           |                                  |                                                     | 63    |                          |       |       | 53    |      
|                                 
|                                 
|                                 
|                                 
|                                  | FDIC insurance                                                                    |                                  |                                                     | 10    |                          |       |       | 10    |      
|                                 
|                                 
|                                 
|                                 
|                                  | Other operating expenses                                                          |                                  |                                                     | 234   |                          |       |       | 215   |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|                                  |                                                                                   |                                  | 1,052                                               |       |                          |       | 1,029 |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|Earnings before income taxes      |                                                                                   |                                  | 1,908                                               |       |                          |       | 1,284 |      
|                                 
|                                 
|                                 
|                                 
|Income taxes                      |                                                                                   |                                  | 528                                                 |       |                          |       | 410   |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|Net earnings                      |                                                                                   | $                                | 1,380                                               |       |                          |       | 874   |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|Basic earnings per common share   |                                                                                   | $                                | 2.65                                                |       |                          |       | 1.67  |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|Diluted earnings per common share |                                                                                   | $                                | 2.62                                                |       |                          |       | 1.66  |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      
|Dividends per share               |                                                                                   | $                                |                                                    |       |                          |       |      |      
|                                  |                                                                                   |                                  |                                                     |       |                          |       |       |      

See accompanying notes to consolidated financial statements (unaudited).

4



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##### Table of Contents






FIRST MCMINNVILLE CORPORATIONConsolidated Statements of Comprehensive Earnings

Three Months Ended March 31, 2002 and 2001

(Unaudited)

|                                          |                                                                                                                                     |                                     |       |                |      |      |     |       |       | 
|----------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------- | ----- | -------------- | ---- | ---- | --- | ----- | ----- | 
|                                          |                                                                                                                                     |                                     |       | 2002           |      | 2001
|                                          |                                                                                                                                     |                                     |       |                |      |     
|                                          |                                                                                                                                     |                                     |       | (In Thousands)
|                                          |                                                                                                                                     |                                     |       |                |      |      |     |      
|                                         
|                                         
|                                         
|                                         
|Net earnings                              |                                                                                                                                     | $                                   | 1,380 |                |      |      | 874 |      
|                                          |                                                                                                                                     |                                     |       |                |      |      |     |      
|Other comprehensive earnings, net of tax: |                                                                                                                                     |                                     |       |                |      |      |     |      
|                                         
|                                         
|                                         
|                                         
|                                          | Unrealized gains on available-for-sale securities arising
during period, net of income taxes of $400,000 and
$734,000, respectively |                                     |       | (653           | )    |      |     | 1,198 |      
|                                         
|                                         
|                                         
|                                         
|                                          | Reclassification adjustment for gains included in net
earnings, net of taxes of $1,000                                              |                                     |       | (2             | )    |      |     |      |      
|                                          |                                                                                                                                     |                                     |       |                |      |      |     |      
|                                          |                                                                                                                                     | Other comprehensive earnings (loss) |       |                | (655 | )    |     |       | 1,198 | 
|                                          |                                                                                                                                     |                                     |       |                |      |      |     |      
|                                          |                                                                                                                                     | Comprehensive earnings              |       | $              | 725  |      |     |       | 2,072 | 
|                                          |                                                                                                                                     |                                     |       |                |      |      |     |      





See accompanying notes to consolidated financial statements (unaudited).

5



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##### Table of Contents






FIRST MCMINNVILLE CORPORATIONConsolidated Statements of Cash Flows

Three Months Ended March 31, 2002 and 2001

Increase (Decrease) in Cash and Cash Equivalents

(Unaudited)

|                                                 |                                                                                   |                                                     |        |                |        |      |       |         |        |  
|------------------------------------------------ | --------------------------------------------------------------------------------- | --------------------------------------------------- | ------ | -------------- | ------ | ---- | ----- | ------- | ------ | -
|                                                 |                                                                                   |                                                     |        | 2002           |        | 2001
|                                                 |                                                                                   |                                                     |        |                |        |     
|                                                 |                                                                                   |                                                     |        | (In Thousands)
|                                                 |                                                                                   |                                                     |        |                |        |      |       |        
|                                                
|                                                
|                                                
|                                                
|Cash flows from operating activities:            |                                                                                   |                                                     |        |                |        |      |       |        
|                                                
|                                                
|                                                
|                                                
|                                                 | Interest received                                                                 |                                                     | $      | 4,413          |        |      |       | 4,933   |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Fees and commissions received                                                     |                                                     |        | 225            |        |      |       | 200     |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Interest paid                                                                     |                                                     |        | (1,928         | )      |      |       | (2,842  | )     
|                                                
|                                                
|                                                
|                                                
|                                                 | Cash paid to suppliers and employees                                              |                                                     |        | (1,023         | )      |      |       | (903    | )     
|                                                
|                                                
|                                                
|                                                
|                                                 | Income taxes paid                                                                 |                                                     |        | (129           | )      |      |       |        |       
|                                                 |                                                                                   |                                                     |        |                |        |      |       |        
|                                                 |                                                                                   | Net cash provided by operating activities           |        |                | 1,558  |      |       |         | 1,388  |  
|                                                 |                                                                                   |                                                     |        |                |        |      |       |        
|Cash flows from investing activities:            |                                                                                   |                                                     |        |                |        |      |       |        
|                                                
|                                                
|                                                
|                                                
|                                                 | Proceeds from maturities of held-to-maturity securities                           |                                                     |        | 4,195          |        |      |       | 19,994  |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Proceeds from maturities of available-for-sale securities                         |                                                     |        | 4,950          |        |      |       | 31,161  |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Proceeds from sales of available-for-sale securities                              |                                                     |        | 288            |        |      |       |        |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Purchase of held-to-maturity securities                                           |                                                     |        | (358           | )      |      |       | (45,542 | )     
|                                                
|                                                
|                                                
|                                                
|                                                 | Purchase of available-for-sale securities                                         |                                                     |        | (100           | )      |      |       | (10,777 | )     
|                                                
|                                                
|                                                
|                                                
|                                                 | Loans to customers, net of repayments                                             |                                                     |        | (677           | )      |      |       |        |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Customer loan repayments, net of advances                                         |                                                     |        |               |        |      |       | 1,776   |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Proceeds from sales of other real estate                                          |                                                     |        |               |        |      |       | 27      |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Decrease in interest bearing deposits in financial institutions                   |                                                     |        | 74             |        |      |       | 27      |       
|                                                 |                                                                                   |                                                     |        |                |        |      |       |        
|                                                 |                                                                                   | Net cash provided by (used in) investing activities |        |                | 8,372  |      |       |         | (3,334 | )
|                                                 |                                                                                   |                                                     |        |                |        |      |       |        
|Cash flows from financing activities:            |                                                                                   |                                                     |        |                |        |      |       |        
|                                                
|                                                
|                                                
|                                                
|                                                 | Net increase (decrease) in non-interest bearing, savings and
NOW deposit accounts |                                                     |        | 1,166          |        |      |       | (3,008  | )     
|                                                
|                                                
|                                                
|                                                
|                                                 | Net increase in time deposits                                                     |                                                     |        | 4,138          |        |      |       | 4,856   |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Increase (decrease) in securities sold under repurchase agreement                 |                                                     |        | (697           | )      |      |       | 2,357   |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Decrease in Federal funds purchased                                               |                                                     |        | (5,000         | )      |      |       | (1,000  | )     
|                                                
|                                                
|                                                
|                                                
|                                                 | Dividends paid                                                                    |                                                     |        | (1,198         | )      |      |       | (1,176  | )     
|                                                
|                                                
|                                                
|                                                
|                                                 | Proceeds from issuance of common stock                                            |                                                     |        |               |        |      |       | 47      |       
|                                                
|                                                
|                                                
|                                                
|                                                 | Payments to acquire treasury stock                                                |                                                     |        | (7             | )      |      |       | (9      | )     
|                                                 |                                                                                   |                                                     |        |                |        |      |       |        
|                                                 |                                                                                   | Net cash (used in) provided by financing activities |        |                | (1,598 | )    |       |         | 2,067  |  
|                                                 |                                                                                   |                                                     |        |                |        |      |       |        
|Net increase in cash and cash equivalents        |                                                                                   |                                                     | 8,332  |                |        |      | 121   |        
|                                                
|                                                
|                                                
|                                                
|Cash and cash equivalents at beginning of period |                                                                                   |                                                     | 7,046  |                |        |      | 4,364 |        
|                                                 |                                                                                   |                                                     |        |                |        |      |       |        
|Cash and cash equivalents at end of period       |                                                                                   | $                                                   | 15,378 |                |        |      | 4,485 |        
|                                                 |                                                                                   |                                                     |        |                |        |      |       |        

See accompanying notes to consolidated financial statements (unaudited).

6



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##### Table of Contents



Consolidated Statements of Cash Flows, Continued

Three Months Ended March 31, 2002 and 2001

Increase (Decrease) in Cash and Cash Equivalents

(Unaudited)

|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |       |     |       | 
|---------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ----------------------------------------- | ------- | -------------- | ----- | ---- | ----- | --- | ----- | 
|                                                                             |                                                                                                                                       |                                            |                                           |         | 2002           |       | 2001
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |     
|                                                                             |                                                                                                                                       |                                            |                                           |         | (In Thousands)
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Reconciliation of net earnings to net cash provided by
operating activities: |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Net earnings                                                                                                                          |                                            | $                                         | 1,380   |                |       |      | 874   |    
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Adjustments to reconcile net earnings to net cash
provided by operating activities:                                                   |                                            |                                           |         |                |       |      |       |    
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                                       | Depreciation                               |                                           |         | 49             |       |      |       | 50  |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                                       | Provision for loan losses                  |                                           |         | 44             |       |      |       | 45  |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                                       | FHLB dividend reinvestment                 |                                           |         | (4             | )     |      |       | (19 | )    
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                                       | Securities gains                           |                                           |         | (3             | )     |      |       |    |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                                       | Decrease in other assets, net              |                                           |         | (37            | )     |      |       | 55  |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                                       | Increase in other liabilities              |                                           |         | 416            |       |      |       | 431 |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                                       | Decrease (increase) in interest receivable |                                           |         | (34            | )     |      |       | 50  |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                                       | Decrease in interest payable               |                                           |         | (253           | )     |      |       | (98 | )    
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                             |                                                                                                                                       |                                            | Total adjustments                         |         |                | 178   |      |       |     | 514   | 
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                             |                                                                                                                                       |                                            | Net cash provided by operating activities |         | $              | 1,558 |      |       |     | 1,388 | 
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|Supplemental schedule of non-cash activities:                                |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Unrealized gain in value of securities available-for-sale,
net of income taxes of $400,000 and income taxes of
$734,000, respectively |                                            | $                                         | 655,000 |                |       |      | 1,198 |    
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |      
|                                                                            
|                                                                            
|                                                                            
|                                                                            
|                                                                             | Loans transferred to other real estate                                                                                                |                                            | $                                         | 54      |                |       |      |      |    
|                                                                             |                                                                                                                                       |                                            |                                           |         |                |       |      |      

See accompanying notes to consolidated financial statements (unaudited).

7



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

Notes to Consolidated Financial Statements

(Unaudited)

Basis of Presentation

The unaudited consolidated financial statements include the accounts of First
McMinnville Corporation (Company or Registrant) and its wholly-owned
subsidiary, First National Bank of McMinnville (Bank) and the Banks
wholly-owned subsidiary, First Community Title and Escrow Company.

The accompanying consolidated financial statements have been prepared, without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations.

In the opinion of management, the statements contain all adjustments and
disclosures necessary to summarize fairly the financial position of the Company
as of March 31, 2002 and December 31, 2001, the results of operations for the
three months ended March 31, 2002 and 2001, comprehensive earnings for the
three months ended March 31, 2002 and 2001 and changes in cash flows for the
three months ended March 31, 2002 and 2001. All significant intercompany
transactions have been eliminated. The interim consolidated financial
statements should be read in conjunction with the notes to the consolidated
financial statements presented in the Companys Annual Report on Form 10-K for
the year ended December 31, 2001. The results for interim periods are not
necessarily indicative of results to be expected for the complete fiscal year.







8



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED






|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations
|------- |  | -------------------------------------------------------------------------------------

The purpose of this discussion is to provide insight into the financial
condition and results of operations of the Company and its subsidiary. This
discussion should be read in conjunction with the consolidated financial
statements. Reference should also be made to the Companys Annual Report on
Form 10-K for the year ended December 31, 2001 for a complete discussion of
factors that impact liquidity, capital and the results of operations.

Forward-Looking Statements

Managements discussion of the Company, and managements analysis of the
Companys operations and prospects, and other matters, may include
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 and other provisions of federal and state
securities laws. Although the Company believes that the assumptions underlying
such forward-looking statements contained in this Report are reasonable, any of
the assumptions could be inaccurate and, accordingly, there can be no assurance
that the forward-looking statements included herein will prove to be accurate.
The use of such words as expect, anticipate, forecast, and comparable terms
should be understood by the reader to indicate that the statement is
forward-looking and thus subject to change in a manner that can be
unpredictable. Factors that could cause actual results to differ from the
results anticipated, but not guaranteed, in this Report, include (without
limitation) economic and social conditions, competition for loans, mortgages,
and other financial services and products, changes in interest rates,
unforeseen changes in liquidity, results of operations, and financial
conditions affecting the Companys customers, as well as other risks that
cannot be accurately quantified or completely identified. Many factors
affecting the Companys financial condition and profitability, including
changes in economic conditions, the volatility of interest rates, political
events and competition from other providers of financial services simply cannot
be predicted. Because these factors are unpredictable and beyond the Companys
control, earnings may fluctuate from period to period. The purpose of this
type of information (such as in Item 2, as well as other portions of this
Report) is to provide Form 10-Q readers with information relevant to
understanding and assessing the financial conditions and results of operations
of the Company, and not to predict the future or to guarantee results. The
Company is unable to predict the types of circumstances, conditions, and
factors that can cause anticipated results to change. The Company undertakes
no obligation to publish revised forward-looking statements to reflect the
occurrence of changes or of unanticipated events, circumstances, or results.

9



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Liquidity and Interest Rate Sensitivity Management

The concept of liquidity involves the ability of the Company and its
subsidiary to meet future cash flow requirements, particularly those of
customers who are either withdrawing funds from their accounts or borrowing to
meet their credit needs.

Proper asset/liability management is designed to maintain stability in the
balance of interest-sensitive assets to interest-sensitive liabilities in order
to provide a stable growth in net interest margins. Earnings on
interest-sensitive assets such as loans tied to the prime rate of interest and
federal funds sold, may vary considerably from fixed rate assets such as
long-term investment securities and fixed rate loans. Interest-sensitive
liabilities such as large certificates of deposit and money market
certificates, generally require higher costs than fixed rate instruments such
as passbook savings.

The Company maintains a formal asset and liability management process to
quantify, monitor and control interest rate risk and to assist management in
maintaining stability in the net interest margin under varying interest rate
environments. The Company accomplishes this process through the development
and implementation of lending, funding and pricing strategies designed to
maximize net interest income under varying interest rate environments subject
to specific liquidity and interest rate risk guidelines.

Analysis of rate sensitivity and rate gap analysis are the primary tools
used to assess the direction and magnitude of changes in net interest income
resulting from changes in interest rates. Included in the analysis are cash
flows and maturities of financial instruments held for purposes other than
trading, changes in market conditions, loan volumns and pricing and deposit
volumn and mix. These assumptions are inherently uncertain, and, as a result,
net interest income can not be precisely estimated nor can the impact of higher
or lower interest rates on net interest income be precisely predicted. Actual
results will differ due to timing, magnitude and frequency of interest rate
changes and changes in market conditions and managements strategies, among
other factors.

Based on the results of the analysis as of March 31, 2002, the Company
would expect net interest income to decrease approximately $15,000 over a
twelve month period if rates increased 2.0%. Net interest income would be
expected to increase approximately $15,000 over a 12 month period should rates
decrease 2.0%. The rate sensitivity as of March 31, 2002 was 1.09 to 1.0 (0-91
days) and .99 to 1.00 (0-365 days). This asset/liability mismatch in pricing
is referred to as gap and is measured as rate sensitive assets divided by
rate sensitive liabilities for a defined time period. A gap of 1.0 means that
assets and liabilities are perfectly matched as to pricing within a specific
time period and interest rate movements will not affect net interest margin,
assuming all other factors hold constant.

Banks, in general, must maintain large cash balances to meet day-to-day
cash flow requirements as well as maintaining required reserves for regulatory
agencies. The cash balances maintained are the primary source of liquidity.
Federal funds sold, which are basically overnight or short-term loans to other
banks that increase the other banks required reserves, are also a major source
of liquidity.

10



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Liquidity and Interest Rate Sensitivity Management, Continued

The Companys investment portfolio consists of earning assets that provide
interest income. For those securities classified as held to maturity, the
Company has the ability and intention to hold these securities until maturity.
Securities classified as available-for-sale include securities intended to be
used as part of the Companys asset/liability strategy and/or securities that
may be sold in response to changes in interest rate, prepayment risk, the need
or desire to increase capital and similar economic factors. Securities
totaling approximately $4.3 million mature or reprice within the next twelve
months.

A secondary source of liquidity is the Banks loan portfolio. At March
31, 2002 commercial loans of approximately $24.7 million and other loans
(mortgage and consumer) of approximately $10.4 million either will become due
or will be subject to rate adjustments within twelve months from the respective
date. Emphasis is placed on structuring adjustable rate loans.

As for liabilities, certificates of deposit of $100,000 or greater of
approximately $43.4 million will become due during the next twelve months. The
Banks deposit base increased approximately $5.3 million during the quarter
ended March 31, 2002. Securities sold under repurchase agreements decreased
approximately $697,000. Federal funds sold were $8,500,000 at March 31, 2002
as compared to Federal funds purchased of $5,000,000 at December 31, 2001. The
increase in Federal funds sold together with the decrease in Federal funds
purchased was funded primarily by a $5.3 million increase in deposits and a
$9.0 million decrease in securities. The decrease in securities resulted
primarily from calls and maturities. Advances from the Federal Home Loan Bank
were $1,000,000 at March 31, 2002 and December 31, 2001.

Historically, there has been no significant reduction in immediately
withdrawable accounts such as negotiable order of withdrawal accounts, money
market demand accounts, demand deposit and regular savings. Management does
not expect that there will be significant withdrawals from these accounts in
the future that are inconsistent with past experience.

The Bank is limited by law, regulation and prudence as to the amount of
dividends that it can pay. At March 31, 2002, the Bank can declare during the
remainder of 2002 cash dividends in an aggregate amount not to exceed
approximately $7.5 million, exclusive of any 2002 net earnings, without prior
approval of the office of the Comptroller of the Currency. However, most of
these funds will be retained for use in the Banks operations rather than being
paid out in dividends. It is anticipated that with present maturities, the
expected growth in deposit base, and the efforts of management in its
asset/liability management program, liquidity will not pose a problem in the
foreseeable future. At the present time there are no known trends or any known
commitments, demands, events or uncertainties that will result in or that are
reasonable likely to result in the Companys liquidity changing in any material
way.

11



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Capital Resources

A primary source of capital is internal growth through retained earnings.
The ratio of stockholders equity to total assets (excluding the unrealized
loss on available-for-sale securities) was 15.1% at March 31, 2002 and 14.6% at
December 31, 2001. Total assets decreased $710,000 during the three months
ended March 31, 2002. The annualized rate of return on stockholders equity
for the three months ended March 31, 2002 was 13.5% compared to 9.2% for the
comparable period in 2001. Cash dividends will be increased during the
remainder of 2002 over 2001 only in the discretion of the Board of Directors
and as profits permit. Dividends paid during 2001 were $3.00 per share. No
material changes in the mix or cost of capital is anticipated in the
foreseeable future. At the present time there are no material commitments for
capital expenditures.

Regulations of the Comptroller of the Currency establish required minimum
capital levels for the Bank. Under these regulations, national banks must
maintain certain capital levels as a percentage of average total assets
(leverage capital ratio) and as a percentage of total risk-based assets
(risk-based capital ratio). Under the risk-based requirements, various
categories of assets and commitments are assigned a percentage related to
credit risk ranging from 0% for assets backed by the full faith and credit of
the United States to 100% for loans other than residential real estate loans
and certain off-balance sheet commitments. Total capital is characterized as
either Tier 1 capital  common shareholders equity, noncumulative perpetual
preferred stock and a limited amount of cumulative perpetual preferred  or
total capital which includes the allowance for loan losses up to 1.25% of risk
weighted assets, perpetual preferred stock, subordinated debt and various other
hybrid capital instruments, subject to various limits. Goodwill is not
includable in Tier 1 or total capital. National banks must maintain a Tier 1
capital to risk-based assets of at least 4.0%, a total capital to risk-based
assets ratio of at least 8.0% and a leverage capital ratio (defined as Tier 1
capital to average total assets for the most recent quarter) of at least 4.0%.
The same ratios are also required in order for a national bank to be considered
adequately capitalized under the OCCs prompt corrective action
regulations, which impose certain operating restrictions on institutions which
are not adequately capitalized. At March 31, 2002 the Bank has a Tier 1
risk-based ratio of 27.28%, a total capital to risk-based ratio of 28.45% and a
Tier 1 leverage ratio of 15.04%, and fell within the category of well
capitalized under the regulations.

The Federal Reserve Board imposes consolidated capital guidelines on bank
holding companies (such as the Company) which have more than $150 million in
consolidated assets. These guidelines required bank holding companies to
maintain consolidated capital ratios which are essentially the same as the
minimum capital levels required for national banks. The Companys consolidated
capital ratios were substantially the same as those set forth above for the
Bank, and exceeded the minimums required under these Federal Reserve Board
guidelines.

12



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Capital Resources, Continued

On April 8, 1997, the Companys stockholders approved the First
McMinnville Corporation 1997 Stock Option Plan. The Company has granted the
right to purchase 46,000 shares of stock to its directors, officers and
employees at exercise prices ranging from $58.15 to $74.30 per share. At March
31, 2002, 6,415 options had been exercised, 4,760 options were forfeited and
22,765 options were exercisable. The options granted are exercisable over a
period of 10 years or until the optionee reaches age 65, whichever is less.
The Company has adopted the provisions of Statement of Financial Accounting
Standards No. 123, Accounting for Stock-Based Compensation (SFAS 123). The
impact of the adoption of SFAS No. 123 has been reflected as a proforma
disclosure in the notes to the annual consolidated financial statements.

Results of Operations

Net earnings were $1,380,000 for the three months ended March 31, 2002 as
compared to $874,000 for the same period in 2001.

As in most financial institutions, a major element in analyzing the
statement of earnings is net interest income which is the excess of interest
earned over interest paid. The net interest margin could be materially
affected during periods of volatility in interest rates.

The Companys interest income, excluding tax equivalent adjustments,
decreased by $451,000 or 9.2% during the three months ended March 31, 2002 as
compared to an increase of $160,000 or 3.4% for the same period in 2001. The
decrease in 2002 was due to decreases in interest rates which resulted from
significant decreases in rates by the Federal Reserve Bank during 2001. Rates
were decreased in excess of 400 basis points during 2001. The increase in 2000
was due primarily to an increase in average earning assets over the prior year
comparable period. The ratio of average earning assets to total average assets
was 95.9% for the quarter ended March 31, 2002 and 97.7% for the quarter ended
March 31, 2001.

Interest expense decreased $1,069,000 for the three months ended March 31,
2002 or 39.0% compared to an increase of $313,000 or 12.9% for the same period
in 2001. The increase in 2002 was the result of decreases in interest rates as
previously discussed. The increase in 2001 can be attributable to an increase
in interest bearing liabilities and increases in interest rates by the Federal
Reserve Bank in the latter part of 2000.

The foregoing resulted in net interest income of $2,776,000 for the three
months ended March 31, 2002 an increase of $618,000 or 28.6% compared to the
same period in 2001.

13



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Results of Operations, Continued

The following schedule details the loans of the Company at March 31, 2002
and December 31, 2001:

|                                     |  |                |         |              |  |  |         | 
|------------------------------------ |  | -------------- | ------- | ------------ |  |  | ------- | 
|                                     |  | March 31,      |         | December 31,
|                                     |  | 2002           |         | 2001        
|                                     |  |                |         |             
|                                     |  | (In Thousands)
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|                                    
|Commercial, financial & agricultural |  | $              | 40,933  |              |  |  | 37,073  | 
|                                    
|                                    
|                                    
|                                    
|Real estate  construction           |  |                | 3,814   |              |  |  | 5,482   | 
|                                    
|                                    
|                                    
|                                    
|Real estate  mortgage               |  |                | 94,379  |              |  |  | 95,774  | 
|                                    
|                                    
|                                    
|                                    
|Consumer                             |  |                | 2,214   |              |  |  | 2,402   | 
|                                     |  |                |         |              |  |  |         | 
|                                     |  | $              | 141,340 |              |  |  | 140,731 | 
|                                     |  |                |         |              |  |  |         | 

The Company accounts for impaired loans under the provisions of Statement
of Financial Accounting Standards (SFAS) No. 114, Accounting by Creditors
for Impairment of a Loan and SFAS No. 118, Accounting by Creditors for
Impairment of a Loan  Income Recognition and Disclosures. These
pronouncements apply to impaired loans except for large groups of
smaller-balance homogeneous loans that are collectively evaluated for
impairment including credit card, residential mortgage, and consumer
installment loans.

A loan is deemed to be impaired when it is probable that the Company will
be unable to collect the scheduled payments of principal and interest due under
the contractual terms of the loan agreement. Impaired loans are measured at
the present value of expected future cash flows discounted at the loans
effective interest rate, at the loans observable market price, or the fair
value of the collateral if the loan is collateral dependent. If the measure of
the impaired loan is less than the recorded investment in the loan, the Company
shall recognize an impairment by creating a valuation allowance with a
corresponding charge to the provision for loan losses or by adjusting an
existing valuation allowance for the impaired loan with a corresponding charge
or credit to the provision for loan losses.

The Companys first mortgage single family residential and consumer loans
which total approximately $64,621,000 and $2,214,000, respectively at March 31,
2002, are divided into various groups of smaller-balance homogeneous loans that
are collectively evaluated for impairment and thus are not subject to the
provisions of SFAS Nos. 114 and 118. Substantially all other loans of the
Company are evaluated for impairment under the provisions of SFAS Nos. 114 and
118.

14



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Results of Operations, Continued

The Company considers all nonaccrual loans evaluated under the provisions
of SFAS Nos. 114 and 118 to be impaired. Loans are placed on nonaccrual status
when doubt as to timely collection of principal or interest exists, or when
principal or interest is past due 90 days or more unless such loans are
well-secured and in the process of collection. Delays or shortfalls in loan
payments are evaluated with various other factors to determine if a loan is
impaired. Generally, delinquencies under 90 days are considered insignificant
unless certain other factors are present which indicate impairment is probable.
The decision to place a loan on nonaccrual status is also based on an
evaluation of the borrowers financial condition, collateral, liquidation
value, and other factors that, in the judgment of management, affect the
borrowers ability to pay.

Generally, at the time a loan is placed on nonaccrual status, all interest
accrued on the loan in the current fiscal year is reversed from income, and all
interest accrued and uncollected from the prior year is charged off against the
allowance for loan losses. Thereafter, interest on nonaccrual loans is
recognized as interest income only to the extent that cash is received and
future collection of principal is not in doubt. If the collectibility of
outstanding principal is doubtful, such interest received is applied as a
reduction of principal. A nonaccrual loan may be restored to accruing status
when principal and interest are no longer past due and unpaid and future
collection of principal and interest on a timely basis is not in doubt. At
March 31, 2002, the Company had no loans on nonaccrual status and there were no
nonaccrual loans outstanding at any time during the three months and year ended
March 31, 2002 and December 31, 2001, respectively. Therefore, all interest
income during these periods was recognized on the accrual basis.

Loans not on nonaccrual status are classified as impaired in certain cases
where there is inadequate protection by the current net worth and financial
capacity of the borrower or of the collateral pledged, if any. In those cases,
such loans have a well-defined weakness or weaknesses that jeopardize the
liquidation of the debt, and if such deficiencies are not corrected, there is a
probability that the Company will sustain some loss. In such cases, interest
income continues to accrue as long as the loan does not meet the Companys
criteria for nonaccrual status.

Generally the Company also classifies as impaired any loans the terms of
which have been modified in a troubled debt restructuring after January 1,
1995. Interest is accrued on such loans that continue to meet the modified
terms of their loan agreements. At March 31, 2002, the Company had no loans
that have had the terms modified in a troubled debt restructuring.

The Companys charge-off policy for impaired loans is similar to its
charge-off policy for all loans in that loans are charged-off in the month when
they are considered uncollectible.

15



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Results of Operations, Continued

Impaired loans and related allowance for loan loss amounts at March 31,
2002 and December 31, 2001 were as follows:

|                          |  |           |       |              |  |  |       | 
|------------------------- |  | --------- | ----- | ------------ |  |  | ----- | 
|                          |  | March 31, |       | December 31,
|(In Thousands)            |  | 2002      |       | 2001        
|                          |  |           |       |             
|                          |  |           |       |              |  |  |       | 
|                         
|                         
|                         
|                         
|Recorded investment       |  | $         | 1,798 |              |  |  | 1,693 | 
|                         
|                         
|                         
|                         
|                          |  |           |       |              |  |  |       | 
|                         
|                         
|                         
|                         
|Allowance for loan losses |  |           | 535   |              |  |  | 533   | 

The allowance for loan loss related to impaired loans was measured based
upon the estimated fair value of related collateral.

The average recorded investment in impaired loans for the three months
ended March 31, 2002 and 2001 was $1,823,000 and $2,069,000, respectively. The
related amount of interest income recognized on the accrual method for the
period that such loans were impaired was approximately $38,000 and $48,000 for
the three months ended March 31, 2002 and 2001, respectively.

The following schedule details selected information as to non-performing
loans of the Company at March 31, 2002 and December 31, 2001:

|                   |  |                |    |                   |  |         |   |             |  |  |     |  |  |  |   | 
|------------------ |  | -------------- | -- | ----------------- |  | ------- | - | ----------- |  |  | --- |  |  |  | - | 
|                   |  | March 31, 2002 |    | December 31, 2001
|                   |  |                |    |                  
|                   |  | Past Due       |    |                   |  |         |   | Past Due    |  |  |     | 
|                   |  | 90 Days        |    | Non-Accrual       |  | 90 Days |   | Non-Accrual
|                   |  |                |    |                   |  |         |   |            
|                   |  | (In Thousands) |    | (In Thousands)   
|                   |  |                |    |                   |  |         |   |             |  |  |     |  |  |  |   | 
|                  
|                  
|                  
|                  
|Real estate loans  |  | $              | 65 |                   |  |         |  |             |  |  | 133 |  |  |  |  | 
|                  
|                  
|                  
|                  
|Installment loans  |  |                | 1  |                   |  |         |  |             |  |  | 2   |  |  |  |  | 
|                  
|                  
|                  
|                  
|Commercial         |  |                |   |                   |  |         |  |             |  |  | 17  |  |  |  |  | 
|                   |  |                |    |                   |  |         |   |             |  |  |     |  |  |  |   | 
|                   |  | $              | 66 |                   |  |         |  |             |  |  | 152 |  |  |  |  | 
|                   |  |                |    |                   |  |         |   |             |  |  |     |  |  |  |   | 
|                   |  |                |    |                   |  |         |   |             |  |  |     |  |  |  |   | 
|                  
|                  
|                  
|                  
|Renegotiated loans |  | $              |   |                   |  |         |  |             |  |  |    |  |  |  |  | 
|                   |  |                |    |                   |  |         |   |             |  |  |     |  |  |  |   | 

16



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Results of Operations, Continued

Transactions in the allowance for loan losses were as follows:

|                                                |                                  |   |                    |     |      |  |       |     |  
|----------------------------------------------- | -------------------------------- | - | ------------------ | --- | ---- |  | ----- | --- | -
|                                                |                                  |   | Three Months Ended
|                                                |                                  |   | March 31,         
|                                                |                                  |   |                   
|                                                |                                  |   | 2002               |     | 2001
|                                                |                                  |   |                    |     |     
|                                                |                                  |   | (In Thousands)    
|                                                |                                  |   |                    |     |      |  |       |    
|                                               
|                                               
|                                               
|                                               
|Balance, January 1, 2002 and 2001, respectively |                                  | $ | 1,804              |     |      |  | 1,711 |    
|                                               
|                                               
|                                               
|                                               
|Add (deduct):                                   |                                  |   |                    |     |      |  |       |    
|                                               
|                                               
|                                               
|                                               
|                                                | Losses charged to allowance      |   |                    | (17 | )    |  |       | (21 | )
|                                               
|                                               
|                                               
|                                               
|                                                | Recoveries credited to allowance |   |                    | 3   |      |  |       | 27  |  
|                                               
|                                               
|                                               
|                                               
|                                                | Provision for loan losses        |   |                    | 44  |      |  |       | 45  |  
|                                                |                                  |   |                    |     |      |  |       |    
|Balance, March 31, 2002 and 2001, respectively  |                                  | $ | 1,834              |     |      |  | 1,762 |    
|                                                |                                  |   |                    |     |      |  |       |    

The provision for loan losses was $44,000 and $45,000 for the first three
months of 2002 and 2001, respectively. The provision for loan losses is based
on past loan experience and other factors which, in managements judgment,
deserve current recognition in estimating possible loan losses. Such factors
include growth and composition of the loan portfolio, review of specific loan
problems, the relationship of the allowance for loan losses to outstanding
loans, and current economic conditions that may affect the borrowers ability
to repay. Management has in place a system designed to identify and monitor
potential problem loans on a timely basis.

The Company maintains an allowance for loan losses which management
believes is adequate to absorb loses inherent in the loan portfolio. A formal
review is prepared bi-monthly by the Loan Review Committee to assess the risk
in the portfolio and to determine the adequacy of the allowance for loan
losses. The review includes analysis of historical performance, the level of
non-performing and adversely rated loans, specific analysis of certain problem
loans, loan activity since the previous assessment, reports prepared by the
Loan Review Committee, consideration of current economic conditions, and other
pertinent information. The level of the allowance to net loans outstanding
will vary depending on the overall results of this bi-monthly assessment. The
review is presented to and subject to approval by the Board of Directors.

17



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Results of Operations, Continued

The following table presents total internally graded loans as of March 31,
2002 and December 31, 2001:

|                                       |  |                |       |         |  |             |       |          |  |  |       |  |  |  |    | 
|-------------------------------------- |  | -------------- | ----- | ------- |  | ----------- | ----- | -------- |  |  | ----- |  |  |  | -- | 
|                                       |  | March 31, 2002 |       |         |  |             |       |          |  |  |       |  |  | 
|                                       |  |                |       |         |  |             |       |          |  |  |       |  |  | 
|                                       |  | (In Thousands) |       | Special |  |             |       |          |  |  |       | 
|                                       |  | Total          |       | Mention |  | Substandard |       | Doubtful
|                                       |  |                |       |         |  |             |       |         
|Commercial, financial and
agricultural |  | $              | 3,719 |         |  |             | 1,921 |          |  |  | 1,763 |  |  |  | 35 | 
|                                      
|                                      
|                                      
|                                      
|Real estate mortgage                   |  |                | 1,805 |         |  |             | 255   |          |  |  | 1,550 |  |  |  |   | 
|                                      
|                                      
|                                      
|                                      
|Real estate construction               |  |                |      |         |  |             |      |          |  |  |      |  |  |  |   | 
|                                      
|                                      
|                                      
|                                      
|Consumer                               |  |                | 30    |         |  |             |      |          |  |  | 30    |  |  |  |   | 
|                                       |  |                |       |         |  |             |       |          |  |  |       |  |  |  |    | 
|                                       |  | $              | 5,554 |         |  |             | 2,176 |          |  |  | 3,343 |  |  |  | 35 | 
|                                       |  |                |       |         |  |             |       |          |  |  |       |  |  |  |    | 

|                                       |  |                   |       |         |  |             |       |          |  |  |       |  |  |  |    | 
|-------------------------------------- |  | ----------------- | ----- | ------- |  | ----------- | ----- | -------- |  |  | ----- |  |  |  | -- | 
|                                       |  | December 31, 2001 |       |         |  |             |       |          |  |  |       |  |  | 
|                                       |  |                   |       |         |  |             |       |          |  |  |       |  |  | 
|                                       |  | (In Thousands)    |       | Special |  |             |       |          |  |  |       | 
|                                       |  | Total             |       | Mention |  | Substandard |       | Doubtful
|                                       |  |                   |       |         |  |             |       |         
|Commercial, financial and
agricultural |  | $                 | 5,662 |         |  |             | 3,106 |          |  |  | 2,521 |  |  |  | 35 | 
|                                      
|                                      
|                                      
|                                      
|Real estate mortgage                   |  |                   | 1,792 |         |  |             | 84    |          |  |  | 1,708 |  |  |  |   | 
|                                      
|                                      
|                                      
|                                      
|Real estate construction               |  |                   |      |         |  |             |      |          |  |  |      |  |  |  |   | 
|                                      
|                                      
|                                      
|                                      
|Consumer                               |  |                   | 6     |         |  |             |      |          |  |  | 6     |  |  |  |   | 
|                                       |  |                   |       |         |  |             |       |          |  |  |       |  |  |  |    | 
|                                       |  | $                 | 7,460 |         |  |             | 3,190 |          |  |  | 4,235 |  |  |  | 35 | 
|                                       |  |                   |       |         |  |             |       |          |  |  |       |  |  |  |    | 

The collateral values, based on estimates received by management, securing
the internally classified loans total approximately $9,054,000 ($2,640,000
related to real property and $6,414,000 related to commercial and other). Such
loans are listed as classified when information obtained about possible credit
problems related to the borrower has prompted management to question the
ability of the borrower to comply with the repayment terms of the loan
agreement. The loan classifications do not represent or result from trends or
uncertainties which management expects will materially and adversely affect
impact future operating results, liquidity or capital resources.

The decrease in the internally graded loans is concentrated in two
customers whose credit were reclassified from special mention to pass during
the quarter ended March 31, 2002. Newly obtained financial information
indicated, in managements view, significant improvement in cash flow for each
customer which resulted in the reclassifications.

18



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Results of Operations, Continued

Residential real estate loans that are graded substandard totaling
$1,550,000 and $1,708,000 at March 31, 2002 and December 31, 2001 consist of
thirty four and thirty one individual loans, respectively, that have been
graded accordingly due to bankruptcies, inadequate cash flows and
delinquencies. No material losses on these loans is anticipated by management.

The following detail provides a breakdown of the allocation of the
allowance for possible loan losses:

|                                       |  |                |       |                   |  |            |     |                |  |   |       |            |  |  |     |  
|-------------------------------------- |  | -------------- | ----- | ----------------- |  | ---------- | --- | -------------- |  | - | ----- | ---------- |  |  | --- | -
|                                       |  | March 31, 2002 |       | December 31, 2001
|                                       |  |                |       |                  
|                                       |  |                |       |                   |  | Percent of |     |                |  |   |       | Percent of
|                                       |  |                |       |                   |  | Loans In   |     |                |  |   |       | Loans In  
|                                       |  | In             |       | Each Category     |  | In         |     | Each Category 
|                                       |  | Thousands      |       | To Total Loans    |  | Thousands  |     | To Total Loans
|                                       |  |                |       |                   |  |            |     |               
|Commercial, financial and
agricultural |  | $              | 1,384 |                   |  |            | 29  | %              |  | $ | 1,344 |            |  |  | 26  | %
|                                      
|                                      
|                                      
|                                      
|Real estate construction               |  |                | 10    |                   |  |            | 3   |                |  |   | 14    |            |  |  | 4   |  
|                                      
|                                      
|                                      
|                                      
|Real estate mortgage                   |  |                | 404   |                   |  |            | 66  |                |  |   | 410   |            |  |  | 68  |  
|                                      
|                                      
|                                      
|                                      
|Consumer                               |  |                | 36    |                   |  |            | 2   |                |  |   | 36    |            |  |  | 2   |  
|                                       |  |                |       |                   |  |            |     |                |  |   |       |            |  |  |     |  
|                                       |  | $              | 1,834 |                   |  |            | 100 | %              |  | $ | 1,804 |            |  |  | 100 | %
|                                       |  |                |       |                   |  |            |     |                |  |   |       |            |  |  |     |  

There were no material amounts of other interest-bearing assets
(interest-bearing deposits with other banks, municipal bonds, etc.) at March
31, 2002 which would be required to be disclosed as past due, non-accrual,
restructured or potential problem loans, if such interest-bearing assets were
loans.

Non-interest income, excluding securities gains, increased $25,000 or
12.5% during the three months ended March 31, 2002 compared to a decrease of
$28,000 or 12.3% for the same period in 2001. The increase in 2002 was in
appraisal fees ($8,000), credit life fees ($10,000), title fees ($10,000) and
miscellaneous fees ($6,000). These increases were off-set by a decrease in
service charges on deposit accounts $11,000). The decrease in 2001 was
primarily from decreases in commissions and fees on fiduciary activities.
There was a decrease of approximately $1,700,000 in trust assets during 2000
which was due to the closing of five trust accounts with no new accounts opened
during the year.

Securities gains totaled $3,000 for the quarter ended March 31, 2002.

There were no securities gains or losses during the three months ended
March 31, 2001.

Non-interest expense was $1,052,000 and $1,029,000 for the first three
months of 2002 and 2001, respectively, an increase of 2.2%. Insignificant
increases in several non-interest expense classifications comprise the
increase.

19



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations, Continued
|------- |  | ------------------------------------------------------------------------------------------------

Results of Operations, Continued

The computation of basic earnings per share is based on the weighted
average number of common shares outstanding during the period. The computation
of diluted earnings per share for the Company begins with the basic earnings
per share plus the effect of common shares contingently issuable from stock
options.

The following is a summary of components comprising basic and diluted
earnings per share (EPS) for the three months ended March 31, 2002 and 2001:

|                                     |                                                                    |                                                      |         |         |         |  |         |         |         | 
|------------------------------------ | ------------------------------------------------------------------ | ---------------------------------------------------- | ------- | ------- | ------- |  | ------- | ------- | ------- | 
|(In Thousands, except share amounts) |                                                                    | 2002                                                 |         | 2001   
|                                     |                                                                    |                                                      |         |        
|                                     |                                                                    |                                                      |         |         |         |  |         |        
|                                    
|                                    
|                                    
|                                    
|Basic EPS Computation:               |                                                                    |                                                      |         |         |         |  |         |        
|                                    
|                                    
|                                    
|                                    
|                                     | Numerator  income available to common
shareholders                |                                                      | $       | 1,380   |         |  |         | 874     |        
|                                     |                                                                    |                                                      |         |         |         |  |         |        
|                                     | Denominator  weighted average number of
common shares outstanding |                                                      |         | 520,906 |         |  |         | 522,493 |        
|                                     |                                                                    |                                                      |         |         |         |  |         |        
|                                     | Basic earnings per common share                                    |                                                      | $       | 2.65    |         |  |         | 1.67    |        
|                                     |                                                                    |                                                      |         |         |         |  |         |        
|Diluted EPS Computation:             |                                                                    |                                                      |         |         |         |  |         |        
|                                    
|                                    
|                                    
|                                    
|                                     | Numerator                                                          |                                                      | $       | 1,380   |         |  |         | 874     |        
|                                     |                                                                    |                                                      |         |         |         |  |         |        
|                                     | Denominator:                                                       |                                                      |         |         |         |  |         |         |        
|                                    
|                                    
|                                    
|                                    
|                                     |                                                                    | Weighted average number of common shares
outstanding |         |         | 520,906 |  |         |         | 522,493 | 
|                                    
|                                    
|                                    
|                                    
|                                     |                                                                    | Dilutive effect of stock options                     |         |         | 5,701   |  |         |         | 4,405   | 
|                                     |                                                                    |                                                      |         |         |         |  |         |        
|                                     |                                                                    |                                                      | 526,607 |         |         |  | 526,898 |        
|                                     |                                                                    |                                                      |         |         |         |  |         |        
|Diluted earnings per common share    |                                                                    | $                                                    | 2.62    |         |         |  | 1.66    |        
|                                     |                                                                    |                                                      |         |         |         |  |         |        

Management is not aware of any current recommendations by the regulatory
authorities which, if implemented, would have a material effect on the
Companys liquidity, capital resources or operations.

Impact of Inflation

The primary impact which inflation has on the results of the Companys
operations is evidenced by its effects on interest rates. Interest rates tend
to reflect, in part, the financial markets expectations of the level of
inflation and, therefore, will generally rise or fall as the level of expected
inflation fluctuates. To the extent interest rates paid on deposits and other
sources of funds rise or fall at a faster rate than the interest income earned
on funds, loans or invested, net interest income will vary. Inflation also
affects non-interest expenses as goods and services are purchased, although
this has not had a significant effect on net earnings in recent years. If the
inflation rate stays flat or increases slightly, the effect on profits is not
expected to be significant.

20



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##### Table of Contents



FIRST MCMINNVILLE CORPORATION

FORM 10-Q, CONTINUED



|Item 3. |  | Quantitative and Qualitative Disclosures About Market Risk
|------- |  | ----------------------------------------------------------

The Companys primary component of market risk is interest rate
volatility. Fluctuations in interest rates will ultimately impact both the
level of income and expense recorded on a large portion of the Companys assets
and liabilities, and the market value of all interest-earning assets and
interest-bearing liabilities, other than those which possess a short term to
maturity such as Federal funds sold or purchased and loans, securities and
deposits as discussed in Item 2. Based upon the nature of the Companys
operations, the Company is not subject to foreign currency exchange or
commodity price risk.

Interest rate risk (sensitivity) management focuses on the earnings risk
associated with changing interest rates. Management seeks to maintain
profitability in both immediate and long term earnings through funds
management/interest rate risk management. The Companys rate sensitivity
position has an important impact on earnings. Senior management of the Company
meets monthly to analyze the rate sensitivity position. These meetings focus
the spread between the cost of funds and interest yields generated primarily
through loans and investments.

There have been no material changes in reported market risks during the
three months ended March 31, 2002. Please refer to Item 2 of Part I of this
Report for additional information related to market and other risks.







21



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##### Table of Contents



PART II. OTHER INFORMATION



|Item 1. |  | LEGAL PROCEEDINGS
|------- |  | -----------------



| |  |  | None
| |  |  | ----



|Item 2. |  | CHANGES IN SECURITIES AND USE OF PROCEEDS
|------- |  | -----------------------------------------



| | (a) |  | Not applicable.
| | --- |  | ---------------
|
| | (b) |  | Not applicable.
|
| | (c) |  | Not applicable.
|
| | (d) |  | Not applicable.



|Item 3. |  | DEFAULTS UPON SENIOR SECURITIES
|------- |  | -------------------------------



| | (a) |  | None.          
| | --- |  | ---------------
|
| | (b) |  | Not applicable.



|Item 4. |  | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
|------- |  | ---------------------------------------------------



| |  |  | No matter was submitted to a vote of security holders during
the period covered by this Report.
| |  |  | -----------------------------------------------------------------------------------------------



|Item 5. |  | OTHER INFORMATION
|------- |  | -----------------



| |  |  | None
| |  |  | ----



|Item 6. |  | EXHIBITS AND REPORTS ON FORM 8-K
|------- |  | --------------------------------



| | (a) |  | None.                                                                               
| | --- |  | ------------------------------------------------------------------------------------
|
| | (b) |  | No reports on Form 8-K were filed during the quarter for which
this Report is filed.

22



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##### Table of Contents



SIGNATURES

Pursuant to the requirements 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.

|      |  |              |  |                                                                               | 
|----- |  | ------------ |  | ----------------------------------------------------------------------------- | 
|      |  |              |  | FIRST MCMINNVILLE CORPORATION(Registrant)                                    
|     
|      |  |              |  |                                                                              
|     
|DATE: |  | May 14, 2002 |  | /s/   Charles C. JacobsCharles C. Jacobs
Chairman and Chief Executive Officer
|     
|      |  |              |  |                                                                              
|     
|      |  |              |  |                                                                              
|     
|DATE: |  | May 14, 2002 |  | /s/   Kenny D. NealKenny D. Neal
Chief Financial and Accounting Officer      





23