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United States Securities and Exchange Commission
 Washington, D.C. 20549
 Form 10-QSB
 þ
    
    Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the Quarterly Period Ended March 31, 2006
 o
    
    Transition Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934
 For
the Transition Period from  to
 Commission File Number 0-16362
 FIRST FRANKLIN CORPORATION
  Delaware
    
    31-1221029(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification Number)4750 Ashwood Drive Cincinnati, Ohio 45241(Address of principal executive offices)(513) 469-5352(Issuers Telephone Number)
 (Former name, former address and former fiscal year, if changed since last report)
 þ o
 o þ
 Applicable Only to Corporate Issuers
   o þ
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FIRST FRANKLIN CORPORATION AND SUBSIDIARIES
 INDEX
 PageNo.Part I Financial InformationItem 1.
    
    Consolidated Balance Sheets  March 31, 2006 and December 31, 2005
    
    
    3Consolidated Statements of Income and Retained
Earnings  Three Month Periods ended March 31, 2006 and 2005
    
    
    4Consolidated Statements of Cash Flows  Three Month
Periods ended March 31, 2006 and 2005
    
    
    5Notes to Consolidated Financial Statements
    
    
    6Item 2.
    
    Managements Discussion and Analysis or Plan of Operations
    
    
    7Item 3.
    
    Controls and Procedures
    
    
    13Part II
    
    Other Information
    
    
    14SignaturesEX-31.1EX-31.2EX-32.1EX-32.2
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ITEM 1. FINANCIAL STATEMENTS
 FIRST FRANKLIN CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS   ASSETS
 March 31, 2006
    
    
    Dec. 31, 2005(Unaudited)Cash, including certificates of deposit and other interest-earning
deposits of $100 at 03/31/06 and $100 at 12/31/05
    
    $
    1,609
    
    
    $
    5,116Investment securities:Securities available-for-sale, at market value
(amortized cost of $24,079 at 03/31/06 and $24,078 at 12/31/05)
    
    
    23,577
    
    
    
    23,665Mortgage-backed securities:Securities available-for-sale, at market value
(amortized cost of $6,575 at 03/31/06 and $7,093 at 12/31/05)
    
    
    6,576
    
    
    
    7,098Securities held-to-maturity, at amortized cost
(market value of $637 at 03/31/06 and $705 at 12/31/05)
    
    
    619
    
    
    
    680Loans receivable, net
    
    
    251,644
    
    
    
    243,059Investment in Federal Home Loan Bank of Cincinnati stock, at cost
    
    
    4,592
    
    
    
    4,528Real estate owned, net
    
    
    274
    
    
    
    Accrued interest receivable
    
    
    1,184
    
    
    
    1,020Property and equipment, net
    
    
    4,269
    
    
    
    4,314Bank owned life insurance
    
    
    3,196
    
    
    
    3,165Other assets
    
    
    4,389
    
    
    
    4,037Total assets
    
    $
    301,929
    
    
    $
    296,682LIABILITIESDeposits
    
    $
    226,422
    
    
    $
    219,364Borrowings
    
    
    48,580
    
    
    
    50,011Advances by borrowers for taxes and insurance
    
    
    1,051
    
    
    
    1,622Other liabilities
    
    
    519
    
    
    
    659Total liabilities
    
    
    276,572
    
    
    
    271,656Minority interest in consolidated subsidiary
    
    
    459
    
    
    
    452STOCKHOLDERS EQUITYPreferred stock  $.01 par value, 500,000 shares authorized,
none issued and outstanding
    
    
    
    
    
    
    Common stock  $.01 par value, 2,500,000 shares authorized,
2,010,867 shares issued at 03/31/06 and 12/31/05
    
    
    13
    
    
    
    13Additional paid-in capital
    
    
    6,189
    
    
    
    6,189Treasury stock, at cost - 325,137 shares at 03/31/06 and
354,537 shares at 12/31/05
    
    
    (3,176
    )
    
    
    (3,536
    )Retained earnings, substantially restricted
    
    
    22,215
    
    
    
    22,177Accumulated other comprehensive income:Unrealized loss on available-for-sale securities, net
of taxes of $(173) at 03/31/06 and $(139) at 12/31/05
    
    
    (343
    )
    
    
    (269
    )Total stockholders equity
    
    
    24,898
    
    
    
    24,574$
    301,929
    
    
    $
    296,682
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FIRST FRANKLIN CORPORATION AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF INCOME
 For the three months endedMarch 31, 2006
    
    
    March 31, 2005(Unaudited)
    
    
    (Unaudited)Interest income:Loans receivable
    
    $
    3,580
    
    
    $
    2,953Mortgage-backed securities
    
    
    82
    
    
    
    117Investments
    
    
    322
    
    
    
    3503,984
    
    
    
    3,420Interest expense:Deposits
    
    
    1,728
    
    
    
    1,499Borrowings
    
    
    625
    
    
    
    3632,353
    
    
    
    1,862Net interest income
    
    
    1,631
    
    
    
    1,558Provision for loan losses
    
    
    50
    
    
    
    44Net interest income after provision for
loan losses
    
    
    1,581
    
    
    
    1,514Noninterest income:Gain on loans sold
    
    
    11
    
    
    
    6Gain on sale of investments
    
    
    
    
    
    
    37Service fees on NOW accounts
    
    
    136
    
    
    
    82Other income
    
    
    128
    
    
    
    117275
    
    
    
    242Noninterest expense:Salaries and employee benefits
    
    
    705
    
    
    
    684Occupancy
    
    
    252
    
    
    
    236Federal deposit insurance premiums
    
    
    7
    
    
    
    8Advertising
    
    
    77
    
    
    
    63Service bureau
    
    
    108
    
    
    
    89Other
    
    
    440
    
    
    
    4501,589
    
    
    
    1,530Income before federal income taxes
    
    
    267
    
    
    
    226Provision for federal income taxes
    
    
    78
    
    
    
    65Net income
    
    $
    189
    
    
    $
    161Retained Earning-Beginning of period
    
    $
    22,177
    
    
    $
    21,484Net Income
    
    
    189
    
    
    
    161Less: Dividends declared
    
    
    (151
    )
    
    
    (132
    )Retained Earnings-end of period
    
    $
    22,215
    
    
    $
    21,513Net income per common share:Basic
    
    $
    0.11
    
    
    $
    0.10Diluted
    
    $
    0.11
    
    
    $
    0.09
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FIRST FRANKLIN CORPORATION AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 For the three months endedMarch 31, 2006
    
    
    March 31, 2005(unaudited)
    
    
    (unaudited)Cash flows from operating activities:Net income
    
    $
    189
    
    
    $
    161Adjustments to reconcile net income to net cash
used by operating activities:Provision for loan losses
    
    
    50
    
    
    
    44Gain on sale of investments
    
    
    
    
    
    
    (37
    )Depreciation and amortization
    
    
    99
    
    
    
    60FHLB stock dividends
    
    
    (64
    )
    
    
    (48
    )Bank Owned Life Insurance
    
    
    (31
    )
    
    
    (30
    )Increase in accrued interest receivable
    
    
    (164
    )
    
    
    (48
    )Decrease (increase) in other assets
    
    
    (352
    )
    
    
    73Decrease in other liabilities
    
    
    (140
    )
    
    
    (431
    )Other, net
    
    
    (264
    )
    
    
    117Proceeds from sale of loans originated for sale
    
    
    1,484
    
    
    
    814Disbursements on loans originated for sale
    
    
    (1,310
    )
    
    
    (814
    )Net cash used by operating activities
    
    
    (503
    )
    
    
    (139
    )Cash flows from investing activities:Loan principal reductions
    
    
    13,579
    
    
    
    13,113Disbursements on mortgage and other loans
originated for investment
    
    
    (22,389
    )
    
    
    (16,031
    )Repayments on mortgage-backed securities
    
    
    578
    
    
    
    902Loans purchased
    
    
    
    
    
    
    (2,405
    )Proceeds from sale of student loans
    
    
    5
    
    
    
    86Proceeds from sale of or maturities of investment securities:Available-for-sale
    
    
    
    
    
    
    8,825Capital expenditures
    
    
    (42
    )
    
    
    (30
    )Net cash provided (used) by investing activities
    
    
    (8,269
    )
    
    
    4,460Cash flows from financing activities:Net change in deposits
    
    
    7,058
    
    
    
    (183
    )Net change in borrowed money
    
    
    (1,431
    )
    
    
    (179
    )Decrease in advances by borrowers for taxes and insurance
    
    
    (571
    )
    
    
    (570
    )Issuance of treasury stock
    
    
    360
    
    
    
    6Payment of dividends
    
    
    (151
    )
    
    
    (132
    )Net cash provided (used) by financing activities
    
    
    5,265
    
    
    
    (1,058
    )Net increase (decrease) in cash
    
    
    (3,507
    )
    
    
    3,263Cash at beginning of year
    
    
    5,116
    
    
    
    10,083Cash at end of year
    
    $
    1,609
    
    
    $
    13,346
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FIRST FRANKLIN CORPORATION AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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Item 2. Managements Discussion and Analysis or Plan of Operations
 FIRST FRANKLIN CORPORATION AND SUBSIDIARIES
MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
 GENERAL
   
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FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES
     Amortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    MarketCost
    
    
    Gains
    
    
    Losses
    
    
    Value(Dollars in thousands)Available-for-saleInvestment securities
    
    $
    24,079
    
    
    $
    9
    
    
    $
    511
    
    
    $
    23,577Mortgage-backed securities
    
    
    6,575
    
    
    
    21
    
    
    
    20
    
    
    
    6,576Held-to-maturityMortgage-backed securities
    
    
    619
    
    
    
    18
    
    
    
    0
    
    
    
    637$
    31,273
    
    
    $
    48
    
    
    $
    531
    
    
    $
    30,790
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(Dollars in thousands)Balance at beginning of period
    
    $
    1,277Charge offs
    
    
    0Additions charged to operations
    
    
    50Recoveries
    
    
    2Balance at end of period
    
    $
    1,329
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(Dollars in thousands)Balance at beginning of period
    
    $
    1,430Charge offs
    
    
    0Additions charged to operations
    
    
    44Recoveries
    
    
    8Balance at end of period
    
    $
    1,482
   Capital Standard
    
    Actual
    
    Required
    
    Excess
    
    Actual
    
    Required
    
    Excess(Dollars in thousands)Core
    
    $
    23,012
    
    
    $
    11,994
    
    
    $
    11,018
    
    
    
    7.67
    %
    
    
    4.00
    %
    
    
    3.67
    %Risk-based
    
    
    24,045
    
    
    
    15,793
    
    
    
    8,252
    
    
    
    12.18
    %
    
    
    8.00
    %
    
    
    4.18
    %
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For the three month periods ended March 31,2006 vs 2005TotalIncrease (decrease) due to
    
    
    increaseVolume
    
    
    Rate
    
    
    (decrease)(Dollars in thousands)Interest income attributable to:Loans receivable (1)
    
    $
    583
    
    
    $
    44
    
    
    $
    627Mortgage-backed securities
    
    
    (71
    )
    
    
    36
    
    
    
    (35
    )Investments
    
    
    (60
    )
    
    
    16
    
    
    
    (44
    )FHLB stock
    
    
    3
    
    
    
    13
    
    
    
    16Total interest-earning assets
    
    $
    455
    
    
    $
    109
    
    
    $
    564Interest expense attributable to:Demand deposits
    
    ($
    29
    )
    
    ($
    2
    )
    
    ($
    31
    )Savings accounts
    
    
    (5
    )
    
    
    9
    
    
    
    4Certificates
    
    
    201
    
    
    
    55
    
    
    
    256FHLB advances
    
    
    276
    
    
    
    (14
    )
    
    
    262Total interest-bearing liabilities
    
    $
    443
    
    
    $
    48
    
    
    $
    491Increase in net interest income
    
    $
    12
    
    
    $
    61
    
    
    $
    73
 
 (1)
    
    Includes non-accruing loans.  - 12 -




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For the three months ended March 31, 2006Averageoutstanding
    
    
    Yield/cost(Dollars in thousands)Average interest-earning assetsLoans
    
    $
    249,700
    
    
    
    5.73
    %Mortgage-backed securities
    
    
    7,369
    
    
    
    4.45
    %Investments
    
    
    24,172
    
    
    
    4.27
    %FHLB stock
    
    
    4,549
    
    
    
    5.63
    %Total
    
    $
    285,790
    
    
    
    5.58
    %Average interest-bearing liabilitiesDemand deposits
    
    $
    36,178
    
    
    
    1.00
    %Savings accounts
    
    
    25,551
    
    
    
    0.88
    %Certificates
    
    
    162,349
    
    
    
    3.90
    %FHLB advances
    
    
    49,225
    
    
    
    5.08
    %Total
    
    $
    273,303
    
    
    
    3.44
    %Net interest-earning assets/interest rate spread
    
    $
    12,487
    
    
    
    2.14
    %For the three months ended March 31, 2005Averageoutstanding
    
    
    Yield/cost(Dollars in thousands)Average interest-earning assetsLoans
    
    $
    209,003
    
    
    
    5.65
    %Mortgage-backed securities
    
    
    12,774
    
    
    
    3.66
    %Investments
    
    
    29,696
    
    
    
    4.07
    %FHLB stock
    
    
    4,324
    
    
    
    4.44
    %Total
    
    $
    255,797
    
    
    
    5.35
    %Average interest-bearing liabilitiesDemand deposits
    
    $
    47,948
    
    
    
    1.01
    %Savings accounts
    
    
    29,092
    
    
    
    0.71
    %Certificates
    
    
    141,502
    
    
    
    3.75
    %FHLB advances
    
    
    27,481
    
    
    
    5.28
    %Total
    
    $
    246,023
    
    
    
    3.03
    %Net interest-earning assets/interest rate spread
    
    $
    9,774
    
    
    
    2.32
    %
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Item 3. Controls and Procedures
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(a)
    
    None(b)
    
    None(c)
    
    None(d)
    
    None
        31.1
    
    CEO certification pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.31.2
    
    CFO certification pursuant to Section 302 of the Sarbanes
Oxley Act of 2002.32.1
    
    CEO certification pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.32.2
    
    CFO certification pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
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FIRST FRANKLIN CORPORATION/s/ Daniel T. VoelpelDaniel T. VoelpelVice President and Chief Financial
OfficerDate: May 12, 2006
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