----

----

**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**WASHINGTON,      D.C. 20549**

**FORM      10Q**

|   | x | QUARTERLY                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934 |
|--------|---|--------------------------------------------------------------------------------------------------------------------------------------|

**September      30, 2006 **

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

**COMMISSION      FILE NUMBER 1-11826**

**MIDSOUTH      BANCORP, INC**
**.**

| **Louisiana**                                                                 |   | **72                -1020809**                      |
|-------------------------------------------------------------------------------|--------|-----------------------------------------------------|
| (State                of other jurisdiction of incorporation or organization) |   | (I.R.S.                Employer Identification No.) |

**102      Versailles Boulevard, Lafayette, Louisiana 70501**

** **

**(337)      237-8343**

| Large                accelerated filer  ̈ | Accelerated                filer  ̈ | Non-accelerated                filer x |
|-----------------------------------------------|-----------------------------------------|----------------------------------------|

----

----

----

**INDEX      TO FORM 10-Q REPORT**

|                                                                |                                                                                                                                          | Page   |
|---------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                |                                                                                                                                          |   |
| **PART                1 -****FINANCIAL                INFORMATION** |                                                                                                                                          |
|                                                                |                                                                                                                                          |   |
| Item                1                                               | Interim                Financial Statements (Unaudited)                                                                                       |   |
|                                                                | Consolidated                Statements of Condition as of September 30, 2006                and December 31, 2005                             | 3      |
|                                                                | Consolidated                Statements of Earnings for the Three and Nine                Months Ended September 30, 2006 and 2005             | 4      |
|                                                                | Consolidated                Statements of Comprehensive Income for the Three                and Nine Months Ended September 30, 2006 and 2005 | 5      |
|                                                                | Consolidated                Statement of Stockholders' Equity for the Nine                Months Ended September 30, 2006                     | 6      |
|                                                                | Statements                of Cash Flows for the Nine Months Ended September                30, 2006 and 2005                                  | 7      |
|                                                                | Notes                to Unaudited Consolidated Financial                Statements                                                            | 8      |
| Item                2.                                              | Management's                Discussion and Analysis of Financial Condition                and Results of Operations                           | 11     |
| Item                3.                                              | Quantitative                and Qualitative Disclosures about Market                Risk                                                      | 26     |
| Item                4.                                              | Controls                and Procedures                                                                                                        | 26     |
|                                                                |                                                                                                                                          |   |
| **PART                II -****OTHER                INFORMATION**    |                                                                                                                                          |
|                                                                |                                                                                                                                          |   |
| Item                1.                                              | Legal                Proceedings                                                                                                              | 26     |
| Item1.A.                                                            | Risk                Factors                                                                                                                   | 27     |
| Item                2.                                              | Unregistered                Sales of Equity Securities and Use of                Proceeds                                                     | 27     |
| Item                3.                                              | Defaults                upon Senior Securities                                                                                                | 27     |
| Item                4.                                              | Submission                of Matters to a Vote of Security                Holders                                                             | 27     |
| Item                5.                                              | Other                Information                                                                                                              | 27     |
| Item                6.                                              | Exhibits                and Reports on Form 8-K                                                                                               | 28     |
| Signatures                                                          | 29                                                                                                                                            |

----

*Index*

**MIDSOUTH      BANCORP, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF CONDITION**

| **ASSETS**                                                                                                                                                                                                                                               |   | September                30,2006(unaudited) |        | December                31,2005                (audited) |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------|-------------|----------------------------------------------------------|--------|
|                                                                                                                                                                                                                                                     |   |                                        |        |                                                     |   |
| Cash                and due from banks                                                                                                                                                                                                                   |   | $                                           | 26,168,760  |                                                     | $      | 25,973,101 |   |
| Interest                bearing deposits in banks                                                                                                                                                                                                        |   |                                        | 34,825      |                                                     |   | 323,901 |   |
| Federal                funds sold                                                                                                                                                                                                                        |   |                                        | -           |                                                     |   | 26,140,000 |   |
| Total                cash and cash equivalents                                                                                                                                                                                                           |   |                                        | 26,203,585  |                                                     |   | 52,437,002 |   |
|                                                                                                                                                                                                                                                     |   |                                        |        |                                                     |   |   |   |
| Securities                available-for-sale, at fair value (cost of $185,905,588 at September                30,                2006 and $140,993,091 at December 31, 2005)                                                                             |   |                                        | 184,536,237 |                                                     |   | 139,428,403 |   |
| Securities                held-to-maturity (estimated fair value of $16,716,938 at September                30,                2006 and $20,151,389 at December 31, 2005)                                                                                |   |                                        | 16,399,477  |                                                     |   | 19,611,230 |   |
| Loans,                net of allowance for loan losses of $4,910,028 at September 30, 2006                and                $4,354,530 at December 31, 2005                                                                                             |   |                                        | 490,474,700 |                                                     |   | 438,439,219 |   |
| Other                investments                                                                                                                                                                                                                         |   |                                        | 2,922,014   |                                                     |   | 2,011,403 |   |
| Bank                premises and equipment, net                                                                                                                                                                                                          |   |                                        | 29,112,870  |                                                     |   | 23,606,039 |   |
| Accrued                interest receivable                                                                                                                                                                                                               |   |                                        | 5,458,811   |                                                     |   | 4,919,294 |   |
| Goodwill                                                                                                                                                                                                                                                 |   |                                        | 9,271,432   |                                                     |   | 9,271,432 |   |
| Intangibles                                                                                                                                                                                                                                              |   |                                        | 738,346     |                                                     |   | 985,264 |   |
| Cash                surrender value of life insurance                                                                                                                                                                                                    |   |                                        | 4,030,022   |                                                     |   | 3,794,510 |   |
| Other                assets                                                                                                                                                                                                                              |   |                                        | 3,945,383   |                                                     |   | 4,310,625 |   |
| **Total                assets**                                                                                                                                                                                                                          |   | $                                           | 773,092,877 |                                                     | $      | 698,814,421 |   |
|                                                                                                                                                                                                                                                     |   |                                        |             |                                                     |   |  |   |
| **LIABILITIES                AND STOCKHOLDERS' EQUITY**                                                                                                                                                                                                  |   |                                        |        |                                                     |   |   |   |
| Deposits:                                                                                                                                                                                                                                                |   |                                        |        |                                                     |   |   |   |
| Non-interest                bearing                                                                                                                                                                                                                      |   | $                                           | 179,919,828 |                                                     | $      | 177,946,159 |   |
| Interest                bearing                                                                                                                                                                                                                          |   |                                        | 511,426,605 |                                                     |   | 446,991,941 |   |
| **Total                deposits**                                                                                                                                                                                                                        |   |                                        | 691,346,433 |                                                     |   | 624,938,100 |   |
|                                                                                                                                                                                                                                                     |   |                                        |        |                                                     |   |   |   |
| Securities                sold under repurchase agreements and federal funds                purchased                                                                                                                                                    |   |                                        | 3,912,669   |                                                     |   | 1,731,797 |   |
| Accrued                interest payable                                                                                                                                                                                                                  |   |                                        | 833,532     |                                                     |   | 936,584 |   |
| Junior                subordinated debenture                                                                                                                                                                                                             |   |                                        | 15,465,000  |                                                     |   | 15,465,000 |   |
| Other                liabilities                                                                                                                                                                                                                         |   |                                        | 2,499,080   |                                                     |   | 2,557,372 |   |
| **Total                liabilities**                                                                                                                                                                                                                     |   |                                        | 714,056,714 |                                                     |   | 645,628,853 |   |
| Commitments                and contingencies                                                                                                                                                                                                             |   |                                        | -           |                                                     |   | - |   |
| Stockholders'                Equity:                                                                                                                                                                                                                     |   |                                        |        |                                                     |   |   |   |
| Common                stock, $.10 par value- 10,000,000 shares authorized, 6,353,446 and                6,258,089 issued and 6,256,131 and 6,189,649 outstanding at September                30,                2006 and December 31, 2005, respectively |   |                                        | 635,345     |                                                     |   | 500,647 |   |
| Surplus                                                                                                                                                                                                                                                  |   |                                        | 42,809,967  |                                                     |   | 41,910,122 |   |
| Unearned                ESOP shares                                                                                                                                                                                                                      |   |                                        | (279,798    | )                                                        |   | (47,194 | ) |
| Accumulated                other comprehensive income                                                                                                                                                                                                    |   |                                        | (903,772    | )                                                        |   | (1,032,694 | ) |
| Treasury                stock - 97,315 at September 30, 2006 and 68,440 shares at December                31,                2005, at cost                                                                                                               |   |                                        | (1,884,933  | )                                                        |   | (1,229,213 | ) |
| Retained                earnings                                                                                                                                                                                                                         |   |                                        | 18,659,354  |                                                     |   | 13,083,900 |   |
| **Total                stockholders' equity**                                                                                                                                                                                                            |   |                                        | 59,036,163  |                                                     |   | 53,185,568 |   |
| **Total                liabilities and stockholders' equity**                                                                                                                                                                                            |   | $                                           | 773,092,877 |                                                     | $      | 698,814,421 |   |

----

*Index*

**MIDSOUTH      BANCORP, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF EARNINGS (UNAUDITED)**
** **

|                                                                                                            |   | Three                Months Ended |       | Nine                Months Ended |   |
|-----------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|------------|----------------------------------|--------|
|                                                                                                            |   | September                30,      |       | September                30,     |   |
|                                                                                                            |   | 2006                              |       | 2005                             |   | 2006 |   | 2005 |   |
|                                                                                                            |   |                              |       |                             |   |   |   |   |   |
| INTEREST                INCOME:                                                                                 |   |                              |       |                             |   |   |   |   |   |
| Loans,                including fees                                                                            |   | $                                 | 10,860,528 |                             | $      | 8,342,155 |   | $ | 30,143,044 |   | $ | 23,331,518 |   |
| Securities                                                                                                      |   |                              |            |                             |   |  |   |   |   |   |   |  |   |
| Taxable                                                                                                         |   |                              | 1,251,978  |                             |   | 759,500 |   |   | 3,389,423 |   |   | 2,306,471 |   |
| Nontaxable                                                                                                      |   |                              | 900,593    |                             |   | 706,266 |   |   | 2,467,370 |   |   | 2,014,437 |   |
| Federal                funds sold                                                                               |   |                              | 68,081     |                             |   | 49,057 |   |   | 768,667 |   |   | 141,840 |   |
| Other                interest income                                                                            |   |                              | 22,518     |                             |   | 25,433 |   |   | 61,638 |   |   | 58,320 |   |
| TOTAL                                                                                                           |   |                              | 13,103,698 |                             |   | 9,882,411 |   |   | 36,830,901 |   |   | 27,852,586 |   |
|                                                                                                            |   |                              |            |                             |   |   |   |   |   |   |   |  |   |
| INTEREST                EXPENSE:                                                                                |   |                              |       |                             |   |   |   |   |   |   |   |  |   |
| Deposits                                                                                                        |   |                              | 4,268,473  |                             |   | 2,634,764 |   |   | 11,603,901 |   |   | 6,649,432 |   |
| Securities                sold under repurchase agreements, federal funds purchased and                advances |   |                              | 58,332     |                             |   | 27,688 |   |   | 107,247 |   |   | 129,219 |   |
| Long                term debt                                                                                   |   |                              | 334,699    |                             |   | 295,362 |   |   | 984,300 |   |   | 867,079 |   |
|                                                                                                            |   |                              |       |                             |   |   |   |   |   |   |   |   |   |
| TOTAL                                                                                                           |   |                              | 4,661,504  |                             |   | 2,957,814 |   |   | 12,695,448 |   |   | 7,645,730 |   |
|                                                                                                            |   |                              |            |                             |   |   |   |   |   |   |   |  |   |
| NET                INTEREST INCOME                                                                              |   |                              | 8,442,194  |                             |   | 6,924,597 |   |   | 24,134,694 |   |   | 20,206,856 |   |
| PROVISION                FOR LOAN LOSSES                                                                        |   |                              | 50,000     |                             |   | 300,000 |   |   | 670,000 |   |   | 679,737 |   |
| NET                INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES                                              |   |                              | 8,392,194  |                             |   | 6,624,597 |   |   | 23,646,694 |   |   | 19,527,119 |   |
|                                                                                                            |   |                              |            |                             |   |   |   |   |   |   |   |  |   |
| OTHER                OPERATING INCOME:                                                                          |   |                              |       |                             |   |   |   |   |   |   |   |  |   |
| Service                charges on deposits                                                                      |   |                              | 2,459,671  |                             |   | 2,088,513 |   |   | 6,560,086 |   |   | 6,414,593 |   |
|                                                                                                            |   |                              |       |                             |   |   |   |   |   |   |   |   |   |
| Gains                (losses)on securities, net                                                                 |   |                              | (7,553     | )                                |   | - |   |   | (7,553 | ) |   | 385 |   |
| Credit                life insurance                                                                            |   |                              | 40,887     |                             |   | 40,602 |   |   | 129,761 |   |   | 121,568 |   |
| Other                charges and fees                                                                           |   |                              | 920,797    |                             |   | 711,373 |   |   | 1,724,761 |   |   | 2,896,825 |   |
| TOTAL                OTHER INCOME                                                                               |   |                              | 3,413,802  |                             |   | 2,840,488 |   |   | 9,328,055 |   |   | 9,433,371 |   |
|                                                                                                            |   |                              |            |                             |   |   |   |   |   |   |   |  |   |
| OTHER                EXPENSES:                                                                                  |   |                              |       |                             |   |   |   |   |   |   |   |  |   |
| Salaries                and employee benefits                                                                   |   |                              | 4,249,564  |                             |   | 3,653,280 |   |   | 11,972,079 |   |   | 10,160,905 |   |
| Occupancy                expense                                                                                |   |                              | 1,722,830  |                             |   | 1,462,505 |   |   | 4,833,038 |   |   | 4,047,115 |   |
| Other                                                                                                           |   |                              | 2,516,205  |                             |   | 2,203,097 |   |   | 7,248,727 |   |   | 7,250,942 |   |
| TOTAL                OTHER EXPENSES                                                                             |   |                              | 8,488,599  |                             |   | 7,318,882 |   |   | 24,053,844 |   |   | 21,458,962 |   |
|                                                                                                            |   |                              |            |                             |   |   |   |   |   |   |   |  |   |
| INCOME                BEFORE INCOME TAXES                                                                       |   |                              | 3,317,397  |                             |   | 2,146,203 |   |   | 8,738,905 |   |   | 7,501,528 |   |
| PROVISION                FOR INCOME TAXES                                                                       |   |                              | 900,260    |                             |   | 512,315 |   |   | 2,267,494 |   |   | 1,903,964 |   |
|                                                                                                            |   |                              |            |                             |   |   |   |   |   |   |   |  |   |
| NET                EARNINGS                                                                                     |   | $                                 | 2,417,137  |                             | $      | 1,633,888 |   | $ | 6,471,411 |   | $ | 5,597,564 |   |
|                                                                                                            |   |                              |       |                             |   |   |   |   |   |   |   |   |   |
| EARNINGS                PER SHARE                                                                               |   |                              |       |                             |   |   |   |   |   |   |   |   |   |
| Basic                                                                                                           |   | $                                 | 0.39       |                             | $      | 0.27 |   | $ | 1.04 |   | $ | 0.91 |   |
| Diluted                                                                                                         |   | $                                 | 0.38       |                             | $      | 0.26 |   | $ | 1.02 |   | $ | 0.88 |   |

----

*Index*

**MIDSOUTH      BANCORP, INC. AND SUBSIDIARIES**

**CONSOLIDATED      STATEMENTS OF **
**COMPREHENSIVE      INCOME (UNAUDITED)**

**FOR      THE THREE AND NINE MONTHS ENDED **
**SEPTEMBER      30, 2006 AND 2005**

|                                                                                                                                                                                                              |   | **Three                Months****Ended****September                30, 2006** |      | **Three                Months****Ended****September                30, 2005** |   | **Nine                Months****Ended****September                30, 2006** |   | **Nine                Months****Ended****September                30, 2005** |      |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------|-----------|-------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------|-----------|
|                                                                                                                                                                                                              |   |                                                                          |      |                                                                          |   |                                                                         |   |                                                                         |      |
| Net                Income                                                                                                                                                                                         |   | $                                                                             | 2,417,137 |                                                                          | $      | 1,633,888                                                                    |   | $                                                                            | 6,471,411 |   | $ | 5,597,564 |   |
| Other                comprehensive income (loss):                                                                                                                                                                 |   |                                                                          |           |                                                                          |   |                                                                         |   |                                                                         |      |   |   |  |   |
| Unrealized                gain(loss) on securities available-for-sale, net:                                                                                                                                       |   |                                                                          |           |                                                                          |   |                                                                         |   |                                                                         |      |   |   |  |   |
| Unrealized                holding gains (losses) arising during the year net of income tax                (benefit)                of $1,042,550, ($244,672), $66,414, and ($464,429)                respectively |   |                                                                          | 2,018,789 |                                                                          |   | (474,952                                                                     | )      |                                                                         | 123,937   |   |   | (901,285 | ) |
| Less                reclassification adjustment for gains included in net income net                of income                tax of ($2,568), -0-, ($2,568), and $131, respectively                               |   |                                                                          | 4,985     |                                                                          |   | -                                                                            |   |                                                                         | 4,985     |   |   | (254 | ) |
|                                                                                                                                                                                                              |   |                                                                          |           |                                                                          |   |                                                                              |   |                                                                         |           |   |   |  |   |
| Total                other comprehensive income (loss)                                                                                                                                                            |   |                                                                          | 2,023,774 |                                                                          |   | (474,952                                                                     | )      |                                                                         | 128,922   |   |   | (901,539 | ) |
|                                                                                                                                                                                                              |   |                                                                          |           |                                                                          |   |                                                                         |   |                                                                         |      |   |   |  |   |
| Total                comprehensive income                                                                                                                                                                         |   | $                                                                             | 4,440,911 |                                                                          | $      | 1,158,936                                                                    |   | $                                                                            | 6,600,333 |   | $ | 4,696,025 |   |

----

*Index*

| **MIDSOUTHBANCORP,              INC. AND              SUBSIDIARIES**                                                                |   |                            |      |       |   |        |   |                                                       |       |
|-------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|-----------|------------|--------|-------------|--------|------------------------------------------------------------|------------|
| **CONSOLIDATED              STATEMENT OF STOCKHOLDERS' EQUITY              (UNAUDITED)**                                            |   |                            |      |       |   |        |   |                                                       |       |
| **FOR                THE NINE MONTHS ENDED SEPTEMBER 30,                2006**                                                      |   |                            |      |       |   |        |   |                                                       |       |   |   |
|                                                                                                                                |   | **COMMON                STOCK** |      |       |   | **ESOP**    |   | **UNREALIZED                GAINS (LOSSES) ON SECURITIES** |       | **TREASURY** |   | **RETAINED** |   |   |   |
|                                                                                                                                |   | **SHARES**                      |      | **AMOUNT** |   | **SURPLUS** |   | **OBLIGATION**                                             |       | **AFS,                NET** |   | **STOCK** |   | **EARNINGS** |   | **TOTAL** |   |
|                                                                                                                                |   |                            |      |       |   |        |   |                                                       |       |   |   |   |   |   |   |   |   |
| **Balance                - January 1, 2006**                                                                                        |   |                            | 6,276,786 |       | $      | 627,679     |   | $                                                          | 41,783,090 |   |   | ($47,194 | ) |   | ($1,032,694 | ) |   | ($1,229,213 | ) | $ | 13,083,900 |   | $ | 53,185,568 |   |
|                                                                                                                                |   |                            |      |       |   |        |   |                                                       |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Dividends                on common stock, $.14 per share                                                                            |   |                            |      |       |   |        |   |                                                       |       |   |   |   |   |   |   |   |   |   |   |   | (895,957 | ) |   | (895,957 | ) |
| Exercise                of stock options                                                                                            |   |                            | 76,660    |       |   | 7,666       |   |                                                       | 334,145    |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 341,811 |   |
| Tax                benefit resulting from exercise of stock options                                                                 |   |                            |      |       |   |        |   |                                                       | 594,899    |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 594,899 |   |
| Purchase                of treasury stock                                                                                           |   |                            |      |       |   |        |   |                                                       |       |   |   |   |   |   |   |   |   | (655,720 | ) |   |   |   |   | (655,720 | ) |
| Net                earnings                                                                                                         |   |                            |      |       |   |        |   |                                                       |       |   |   |   |   |   |   |   |   |   |   |   | 6,471,411 |   |   | 6,471,411 |   |
| Increase                in ESOP obligation, net of repayments                                                                       |   |                            |      |       |   |        |   |                                                       |       |   |   | (232,604 | ) |   |   |   |   |   |   |   |   |   |   | (232,604 | ) |
| Excess                of market value over book value of ESOP shares released, net                adjustment                        |   |                            |      |       |   |        |   |                                                       | 52,500     |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 52,500 |   |
| Stock                option expense                                                                                                 |   |                            |      |       |   |        |   |                                                       | 45,333     |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 45,333 |   |
| Net                change in unrealized gains( losses) on securities available-for-sale,                net                of taxes |   |                            |      |       |   |        |   |                                                       |       |   |   |   |   |   | 128,922 |   |   |   |   |   |   |   |   | 128,922 |   |
|                                                                                                                                |   |                            |      |       |   |        |   |                                                       |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Balance                - September 30, 2006**                                                                                     |   |                            | 6,353,446 |       | $      | 635,345     |   | $                                                          | 42,809,967 |   |   | ($279,798 | ) |   | ($903,772 | ) |   | ($1,884,933 | ) | $ | 18,659,354 |   | $ | 59,036,163 |   |

----

*Index*

| **MIDSOUTH                BANCORP, INC. AND                SUBSIDIARIES**                                       |   |                          |         |
|-----------------------------------------------------------------------------------------------------------------|--------|-------------------------------|--------------|
| **CONSOLIDATED                STATEMENTS OF CASH FLOWS (UNAUDITED)**                                            |   |                          |         |
| **FOR                THE NINE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005**                                        |   |                          |         |
|                                                                                                            |   | Sept.                30, 2006 |         | Sept.                30, 2005 |   |
| Cash                flows from operating activities:                                                            |   |                          |         |   |   |
| Net                earnings                                                                                     |   | $                             | 6,471,411    |   | $ | 5,597,564 |   |
|                                                                                                            |   |                          |         |   |   |   |   |
| Adjustments                to reconcile net income to net cash provided by operating                activities: |   |                          |         |   |   |   |   |
| Depreciation                and amortization                                                                    |   |                          | 2,044,232    |   |   | 1,573,702 |   |
| Provision                for loan losses                                                                        |   |                          | 670,000      |   |   | 679,737 |   |
| Deferred                income taxes (benefit)                                                                  |   |                          | (255,005     | ) |   | 56,699 |   |
| Amortization                of premiums on securities, net                                                      |   |                          | 538,165      |   |   | 669,026 |   |
| (Gain)                loss on sale of securities, net                                                           |   |                          | 7,553        |   |   | (385 | ) |
| Change                in accrued interest receivable                                                            |   |                          | (539,517     | ) |   | (896,947 | ) |
| Change                in accrued interest payable                                                               |   |                          | (103,052     | ) |   | (155,825 | ) |
| Other,                net                                                                                       |   |                          | 1,187,234    |   |   | 353,766 |   |
| Net                cash provided by operating activities                                                        |   |                          | 10,021,021   |   |   | 7,877,337 |   |
|                                                                                                            |   |                          |         |   |   |   |   |
| Cash                flows from investing activities, net of effect of                acquisitions:              |   |                          |         |   |   |   |   |
| Proceeds                from sales of securities available-for-sale                                             |   |                          | 2,988,590    |   |   | 9,099,585 |   |
| Proceeds                from maturities and calls of securities held-to-maturity                                |   |                          | 3,219,900    |   |   | 1,973,244 |   |
| Proceeds                from maturities and calls of securities available-for-sale                              |   |                          | 26,308,619   |   |   | 26,597,665 |   |
| Purchases                of securities available-for-sale                                                       |   |                          | (74,763,571  | ) |   | (27,471,843 | ) |
| Purchases                of other investments, net of redemptions                                               |   |                          | (910,950     | ) |   | (138,100 | ) |
| Loan                originations, net of repayments                                                             |   |                          | (53,029,037  | ) |   | (48,501,118 | ) |
| Purchases                of premises and equipment                                                              |   |                          | (7,304,836   | ) |   | (4,102,047 | ) |
| Proceeds                from sales of other real estate owned                                                   |   |                          | 151,450      |   |   | 455,726 |   |
| Net                cash used in investing activities                                                            |   |                          | (103,339,285 | ) |   | (42,086,888 | ) |
|                                                                                                            |   |                          |         |   |   |   |   |
| Cash                flows from financing activities, net of effect of                acquisitions:              |   |                          |         |   |   |   |   |
| Change                in deposits                                                                               |   |                          | 66,408,333   |   |   | 56,021,447 |   |
| Change                in repurchase agreements                                                                  |   |                          | 980,872      |   |   | (1,721,392 | ) |
| Change                in federal funds purchased                                                                |   |                          | 1,200,000    |   |   | (8,500,000 | ) |
| Proceeds                from FHLB advances                                                                      |   |                          | -            |   |   | 5,000,000 |   |
| Repayment                of FHLB advances                                                                       |   |                          | -            |   |   | (5,000,000 | ) |
| Purchase                of treasury stock                                                                       |   |                          | (655,720     | ) |   | (295,392 | ) |
| Payment                of dividends on common stock                                                             |   |                          | (1,190,449   | ) |   | (1,069,218 | ) |
| Proceeds                from exercise of stock options                                                          |   |                          | 341,811      |   |   | 120,632 |   |
| Cash                for fractional shares                                                                       |   |                          | -            |   |   | (10,640 | ) |
| Net                cash provided by financing activities                                                        |   |                          | 67,084,847   |   |   | 44,545,437 |   |
|                                                                                                            |   |                          |         |   |   |   |   |
| Net                (decrease) increase in cash and cash equivalents                                             |   |                          | (26,233,417  | ) |   | 10,335,886 |   |
|                                                                                                            |   |                          |         |   |   |   |   |
| Cash                and cash equivalents, beginning of year                                                     |   |                          | 52,437,002   |   |   | 17,396,850 |   |
|                                                                                                            |   |                          |         |   |   |   |   |
| Cash                and cash equivalents, end of quarter                                                        |   | $                             | 26,203,585   |   | $ | 27,732,736 |   |

----

*Index*

**MIDSOUTH      BANCORP, INC. AND SUBSIDIARIES**

**NOTES      TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENT**

| **1.** | **Basis                of Presentation** |
|--------|------------------------------------------|

***Use      of Estimates***

***Stock      Compensation***
*Share-Based      Payment*

----

*Index*

|                                                                                                   |   | Three                Months Ended                Sept.                30, 2005 |   | Nine                Months Ended                Sept.                30, 2005 |   |
|--------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------|--------|
|                                                                                                   |   |                                                                           |   |                                                                          |   |
| Net                earnings available to common stockholders                (in thousands):            |   |                                                                           |   |                                                                          |   |
| As                reported                                                                             |   | $                                                                              | 1,634  |                                                                          | $      | 5,598 |   |
| Deduct                total stock based compensation determined under fair value                method |   |                                                                           | (15    | )                                                                             |   | (45 | ) |
| Pro                forma                                                                               |   | $                                                                              | 1,619  |                                                                          | $      | 5,553 |   |
| Basic                earnings per share:                                                               |   |                                                                           |   |                                                                          |   |   |   |
| As                reported                                                                             |   | $                                                                              | 0.27   |                                                                          | $      | 0.91 |   |
| Pro                forma                                                                               |   | $                                                                              | 0.26   |                                                                          | $      | 0.90 |   |
| Diluted                earnings per share:                                                             |   |                                                                           |   |                                                                          |   |   |   |
| As                reported                                                                             |   | $                                                                              | 0.26   |                                                                          | $      | 0.88 |   |
| Pro                forma                                                                               |   | $                                                                              | 0.26   |                                                                          | $      | 0.87 |   |

***Recent      Accounting Pronouncements***
*Employers’      Accounting for Defined Benefit Pension and Other Post Retirement      Plans*

*Fair      Value Measurements*

*Accounting      for Uncertainty in Income Taxes*

----

*Index*

*      Accounting for Certain Hybrid Financial Instruments - an amendment of SFAS      No.      133 and 140*

*Accounting      Changes and Error Corrections*

| **2.** | **Allowance                for Loan Losses** |
|--------|----------------------------------------------|

|                                          |   | Nine                Months Ended |   |
|-----------------------------------------------|--------|----------------------------------|--------|
|                                          |   | September                30,     |   |
|                                          |   | 2006                             |   | 2005 |   |
| (in                thousands)                 |   |                             |   |   |   |
| Balance                at beginning of period |   | $                                | 4,355  |   | $ | 3,851 |   |
| Provision                for loan losses      |   |                             | 670    |   |   | 680 |   |
| Recoveries                                    |   |                             | 266    |   |   | 162 |   |
| Loans                charged off              |   |                             | (381   | ) |   | (482 | ) |
|                                          |   |                             |        |   |   |  |   |
| Balance                at end of period       |   | $                                | 4,910  |   | $ | 4,211 |   |

| **3.** | **Declaration                of Dividends** |
|--------|---------------------------------------------|

----

*Index*

**Part      1. Item 2.  MANAGEMENT'S DISCUSSION      AND      ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS**

**Forward      Looking Statements**

| · | changes                in interest rates and market prices that could affect the net interest                margin, asset valuation, and expense                levels; |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | changes                in local economic and business conditions that could adversely affect                customers and their ability to repay borrowings under agreed upon                terms                and/or adversely affect the value of the underlying collateral related                to                the borrowings; |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | increased                competition for deposits and loans which could affect rates and                terms; |
|--------|----------------------------------------------------------------------------------------------------------------|

| · | changes                in the levels of prepayments received on loans and investment securities                that adversely affect the yield and value of the earning                assets; |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | a                deviation in actual experience from the underlying assumptions used                to                determine and establish the Allowance for Loan Losses                (“ALL”); |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | changes                in the availability of funds resulting from reduced liquidity or                increased                costs; |
|--------|----------------------------------------------------------------------------------------------------------------------------------------|

| · | the                timing and impact of future acquisitions, the success or failure                of                integrating operations, and the ability to capitalize on growth                opportunities upon entering new                markets; |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | the                ability to acquire, operate and maintain effective and efficient                operating                systems; |
|--------|--------------------------------------------------------------------------------------------------------------------------------------|

----

*Index*

| · | increased                asset levels and changes in the composition of assets which would                impact                capital levels and regulatory capital                ratios; |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | loss                of critical personnel and the challenge of hiring qualified personnel                at                reasonable compensation levels; |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | changes                in government regulations and accounting principles, policies and                guidelines applicable to financial holding companies and banking;                and |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | acts                of terrorism, weather, or other events beyond the Company’s                control. |
|--------|---------------------------------------------------------------------------------------------------------------|

----

*Index*

**Critical      Accounting Policies**

**Results      of Operations**

----

*Index*

** **

----

*Index*

**Earnings      Analysis**

**Net      Interest Income**

----

*Index*

----

*Index*

**Table      1 - Consolidated Average Balances, Interest and Rates**

**Taxable-equivalent      basis (2)**

**(in      thousands)**

|                                                                                                      |   | Three                  Months Ended |    | Three                  Months Ended |   |
|-----------------------------------------------------------------------------------------------------------|--------|-------------------------------------|---------|-------------------------------------|--------|
|                                                                                                      |   | September                  30, 2006 |    | September                  30, 2005 |   |
|                                                                                                      |   | Average                             |    |                                |   | Average |   | Average |   |   |   | Average |   |
|                                                                                                      |   | Volume                              |    | Interest                            |   | Yield/Rate |   | Volume |   | Interest |   | Yield/Rate |   |
| ASSETS                                                                                                    |   |                                |    |                                |   |   |   |   |   |   |   |   |   |
| Interest                  Bearing Deposits                                                                |   | $                                   | 100     |                                | $      | 1 |   |   | 5.40 | %    | $ | 82 |   | $ | 1 |   |   | 2.92 | % |
| Investment                  Securities (1)                                                                |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Taxable                                                                                                   |   |                                | 108,637 |                                |   | 1,250 |   |   | 4.60 | % |   | 77,809 |   |   | 765 |   |   | 3.93 | % |
| Tax                  Exempt (2)                                                                           |   |                                | 98,710  |                                |   | 1,271 |   |   | 5.15 | % |   | 78,697 |   |   | 987 |   |   | 5.02 | % |
| Equity                  Securities                                                                        |   |                                | 2,442   |                                |   | 23 |   |   | 3.69 | % |   | 2,686 |   |   | 25 |   |   | 3.79 | % |
| Total                  Investments                                                                        |   |                                | 209,789 |                                |   | 2,544 |   |   | 4.85 | % |   | 159,192 |   |   | 1,777 |   |   | 4.46 | % |
| Federal                  Funds Sold and Securities                                                        |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Purchased                  Under Agreements to Resell                                                     |   |                                | 5,157   |                                |   | 68 |   |   | 5.24 | % |   | 5,926 |   |   | 49 |   |   | 3.28 | % |
| Loans                  (3)                                                                                |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                  and Real Estate                                                               |   |                                | 390,297 |                                |   | 8,742 |   |   | 8.89 | % |   | 327,941 |   |   | 6,418 |   |   | 7.77 | % |
| Installment                                                                                               |   |                                | 98,772  |                                |   | 2,119 |   |   | 8.51 | % |   | 94,646 |   |   | 1,924 |   |   | 8.06 | % |
| Total                  Loans                                                                              |   |                                | 489,069 |                                |   | 10,861 |   |   | 8.81 | % |   | 422,587 |   |   | 8,342 |   |   | 7.83 | % |
|                                                                                                      |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                  Earning Assets                                                                     |   |                                | 704,115 |                                |   | 13,474 |   |   | 7.59 | % |   | 587,787 |   |   | 10,169 |   |   | 6.86 | % |
|                                                                                                      |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance                  for Loan Losses                                                                |   |                                | (4,882  | )                                   |   |   |   |   |   |   |   | (4,073 | ) |   |   |   |   |   |   |
| Nonearning                  Assets                                                                        |   |                                | 72,658  |                                |   |   |   |   |   |   |   | 66,505 |   |   |   |   |   |   |   |
| Total                  Assets                                                                             |   | $                                   | 771,891 |                                |   |   |   |   |   |   | $ | 650,219 |   |   |   |   |   |   |   |
|                                                                                                      |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES                  AND STOCKHOLDERS' EQUITY                                                     |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NOW,                  Money Market, and Savings                                                           |   | $                                   | 403,623 |                                | $      | 3,286 |   |   | 3.23 | % | $ | 320,864 |   | $ | 1,811 |   |   | 2.24 | % |
| Time                  Deposits                                                                            |   |                                | 111,735 |                                |   | 982 |   |   | 3.49 | % |   | 117,194 |   |   | 824 |   |   | 2.79 | % |
| Total                  Interest Bearing Deposits                                                          |   |                                | 515,358 |                                |   | 4,268 |   |   | 3.29 | % |   | 438,058 |   |   | 2,635 |   |   | 2.39 | % |
|                                                                                                      |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal                  Funds Purchased, Securities Sold Under Agreements to                  Repurchase |   |                                | 4,686   |                                |   | 58 |   |   | 4.94 | % |   | 2,895 |   |   | 24 |   |   | 3.28 | % |
| Junior                  Subordinated Debentures                                                           |   |                                | 15,465  |                                |   | 335 |   |   | 8.59 | % |   | 15,465 |   |   | 295 |   |   | 7.58 | % |
| Federal                  Home Loan Bank Advances                                                          |   |                                | -       |                                |   | - |   |   |  |   |   | 389 |   |   | 4 |   |   | 3.83 | % |
| Total                  Interest Bearing Liabilities                                                       |   |                                | 535,509 |                                |   | 4,661 |   |   | 3.45 | % |   | 456,807 |   |   | 2,958 |   |   | 2.57 | % |
|                                                                                                      |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand                  Deposits                                                                          |   |                                | 176,282 |                                |   |   |   |   |   |   |   | 136,696 |   |   |   |   |   |   |   |
| Other                  Liabilities                                                                        |   |                                | 3,615   |                                |   |   |   |   |   |   |   | 4,903 |   |   |   |   |   |   |   |
| Stockholders'                  Equity                                                                     |   |                                | 56,485  |                                |   |   |   |   |   |   |   | 51,813 |   |   |   |   |   |   |   |
| Total                  Liabilities and Stockholders' Equity                                               |   | $                                   | 771,891 |                                |   |   |   |   |   |   | $ | 650,219 |   |   |   |   |   |   |   |
|                                                                                                      |   |                                |    |                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NET                  TAXABLE-EQUIVALENT INTEREST INCOME AND SPREAD                                        |   |                                |    |                                | $      | 8,813 |   |   | 4.14 | % |   |   |   | $ | 7,211 |   |   | 4.29 | % |
| NET                  TAXABLE-EQUIVALENT YIELD ON EARNING ASSETS                                           |   |                                |    |                                |   |   |   |   | 4.97 | % |   |   |   |   |   |   |   | 4.87 | % |

| (1) | Securities                classified as available-for-sale are included in average balances                and                interest income figures reflect interest earned on such                securities. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Interest                income of $370,467 for 2006 and $286,350 for 2005 is added to interest                earned on tax-exempt obligations to reflect tax-equivalent yields                using a                34% tax rate. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Interest                income includes loan fees of $840,842 for 2006 and $752,394 for 2005.                Nonaccrual loans are included in average balances and income on such                loans                is recognized on a cash basis. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

*Index*

**Table      2 - Changes in Taxable-Equivalent Net Interest Income**

**(in      thousands)**

|                                                                                                    |   | Three                Months Ended                                |   |
|---------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------|--------|
|                                                                                                    |   | September                30, 2006 compared to September 30, 2005 |   |
|                                                                                                    |   | Total                                                            |   | Change |   |
|                                                                                                    |   | Increase                                                         |   | Attributable                to |   |
|                                                                                                    |   | (Decrease)                                                       |   | Volume |   | Rates |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |
| Taxable-equivalent                interest earned on:                                                   |   |                                                             |   |   |   |   |   |
| Investment                Securities                                                                    |   |                                                             |   |   |   |   |   |
| Taxable                                                                                                 |   |                                                             | 485    |   |   | 394 |   |   | 91 |   |
| Tax                Exempt                                                                               |   |                                                             | 284    |   |   | 257 |   |   | 27 |   |
| Equity                Securities                                                                        |   |                                                             | (2     | ) |   | (2 | ) |   | - |   |
| Federal                Funds Sold and Securities Purchased Under Agreement to                Resell     |   |                                                             | 19     |   |   | (5 | ) |   | 24 |   |
| Loans,                including fees                                                                    |   |                                                             | 2,519  |   |   | 1,404 |   |   | 1,115 |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |   |   |   |
| TOTAL                                                                                                   |   |                                                             | 3,305  |   |   | 2,048 |   |   | 1,257 |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |   |   |   |
| Interest                Paid On:                                                                        |   |                                                             |   |   |   |   |   |   |   |   |
| Interest                Bearing Deposits                                                                |   |                                                             | 1,633  |   |   | 520 |   |   | 1,113 |   |
| Federal                Funds Purchased and Securities Sold Under Agreement to                Repurchase |   |                                                             | 34     |   |   | 19 |   |   | 15 |   |
| Federal                Home Loan Bank Advances                                                          |   |                                                             | (4     | ) |   | (4 | ) |   | - |   |
| Junior                Subordinated Debentures                                                           |   |                                                             | 40     |   |   | - |   |   | 40 |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |   |   |   |
| TOTAL                                                                                                   |   |                                                             | 1,703  |   |   | 535 |   |   | 1,168 |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |   |   |   |
| Taxable-equivalent                net interest income                                                   |   | $                                                                | 1,602  |   | $ | 1,513 |   | $ | 89 |   |

| NOTE: | Changes                due to both volume and rate has generally been allocated to volume                and                rate changes in proportion to the relationship of the absolute dollar                amounts to the changes in each. |
|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

*Index*

**Table      3 - Consolidated Average Balances, Interest and Rates**

**Taxable-equivalent      basis (2)**

**(in      thousands)**

|                                                                                                  |   | Nine                Months Ended  |    | Nine                Months Ended  |   |
|-------------------------------------------------------------------------------------------------------|--------|-----------------------------------|---------|-----------------------------------|--------|
|                                                                                                  |   | September                30, 2006 |    | September                30, 2005 |   |
|                                                                                                  |   | Average                           |    |                              |   | Average |   | Average |   |   |   | Average |   |
|                                                                                                  |   | Volume                            |    | Interest                          |   | Yield/Rate |   | Volume |   | Interest |   | Yield/Rate |   |
| ASSETS                                                                                                |   |                              |    |                              |   |   |   |   |   |   |   |   |   |
| Interest                Bearing Deposits                                                              |   | $                                 | 260     |                              | $      | 10 |   |   | 5.35 | %     | $ | 63 |   | $ | 1 |   |   | 3.11 | % |
| Investment                Securities (1)                                                              |   |                              |    |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Taxable                                                                                               |   |                              | 100,609 |                              |   | 3,379 |   |   | 4.48 | % |   | 79,655 |   |   | 2,305 |   |   | 3.86 | % |
| Tax                Exempt (2)                                                                         |   |                              | 91,047  |                              |   | 3,479 |   |   | 5.10 | % |   | 76,583 |   |   | 2,835 |   |   | 4.94 | % |
| Equity                Securities                                                                      |   |                              | 2,271   |                              |   | 62 |   |   | 3.62 | % |   | 2,631 |   |   | 58 |   |   | 2.96 | % |
| Total                Investments                                                                      |   |                              | 193,927 |                              |   | 6,920 |   |   | 4.76 | % |   | 158,869 |   |   | 5,198 |   |   | 4.36 | % |
| Federal                Funds Sold and Securities Purchased Under Agreements to                Resell  |   |                              | 22,045  |                              |   | 769 |   |   | 4.66 | % |   | 6,801 |   |   | 142 |   |   | 2.79 | % |
| Loans                (3)                                                                              |   |                              |    |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                and Real Estate                                                             |   |                              | 370,079 |                              |   | 24,074 |   |   | 8.70 | % |   | 316,447 |   |   | 17,958 |   |   | 7.59 | % |
| Installment                                                                                           |   |                              | 96,299  |                              |   | 6,069 |   |   | 8.43 | % |   | 88,428 |   |   | 5,374 |   |   | 8.13 | % |
| Total                Loans                                                                            |   |                              | 466,378 |                              |   | 30,143 |   |   | 8.64 | % |   | 404,875 |   |   | 23,332 |   |   | 7.70 | % |
|                                                                                                  |   |                              |    |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                Earning Assets                                                                   |   |                              | 682,610 |                              |   | 37,842 |   |   | 7.41 | % |   | 570,608 |   |   | 28,673 |   |   | 6.72 | % |
|                                                                                                  |   |                              |    |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance                for Loan Losses                                                              |   |                              | (4,615  | )                                 |   |   |   |   |   |   |   | (3,979 | ) |   |   |   |   |   |   |
| Nonearning                Assets                                                                      |   |                              | 71,913  |                              |   |   |   |   |   |   |   | 63,202 |   |   |   |   |   |   |   |
| Total                Assets                                                                           |   | $                                 | 749,908 |                              |   |   |   |   |   |   | $ | 629,831 |   |   |   |   |   |   |   |
|                                                                                                  |   |                              |    |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES                AND STOCKHOLDERS’ EQUITY                                             |   |                              |    |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NOW,                Money Market, and Savings                                                         |   | $                                 | 380,179 |                              | $      | 8,626 |   |   | 3.03 | % | $ | 303,893 |   | $ | 4,502 |   |   | 1.98 | % |
| Time                Deposits                                                                          |   |                              | 117,858 |                              |   | 2,978 |   |   | 3.38 | % |   | 117,271 |   |   | 2,147 |   |   | 2.45 | % |
| Total                Interest Bearing Deposits                                                        |   |                              | 498,037 |                              |   | 11,604 |   |   | 3.12 | % |   | 421,164 |   |   | 6,649 |   |   | 2.11 | % |
| Federal                Funds Purchased, Securities Sold Under Agreements to                Repurchase |   |                              | 3,159   |                              |   | 107 |   |   | 4.54 | % |   | 5,091 |   |   | 102 |   |   | 2.67 | % |
| Junior                Subordinated Debentures                                                         |   |                              | 15,465  |                              |   | 984 |   |   | 8.51 | % |   | 15,465 |   |   | 867 |   |   | 7.50 | % |
| Federal                Home Loan Bank Advances                                                        |   |                              | -       |                              |   | - |   |   |   |   |   | 1,310 |   |   | 28 |   |   | 2.81 | % |
| Total                Interest Bearing Liabilities                                                     |   |                              | 516,661 |                              |   | 12,695 |   |   | 3.29 | % |   | 443,030 |   |   | 7,646 |   |   | 2.31 | % |
|                                                                                                  |   |                              |    |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand                Deposits                                                                        |   |                              | 175,137 |                              |   |   |   |   |   |   |   | 131,923 |   |   |   |   |   |   |   |
| Other                Liabilities                                                                      |   |                              | 3,233   |                              |   |   |   |   |   |   |   | 4,354 |   |   |   |   |   |   |   |
| Stockholders’                Equity                                                             |   |                              | 54,877  |                              |   |   |   |   |   |   |   | 50,524 |   |   |   |   |   |   |   |
| Total                Liabilities and Stockholders’ Equity                                       |   | $                                 | 749,908 |                              |   |   |   |   |   |   | $ | 629,831 |   |   |   |   |   |   |   |
|                                                                                                  |   |                              |    |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NET                TAXABLE-EQUIVALENT INTEREST INCOME AND SPREAD                                      |   |                              |    |                              | $      | 25,147 |   |   | 4.12 | % |   |   |   | $ | 21,027 |   |   | 4.41 | % |
| NET                TAXABLE-EQUIVALENT YIELD ON EARNING ASSETS                                         |   |                              |    |                              |   |   |   |   | 4.93 | % |   |   |   |   |   |   |   | 4.93 | % |

| (1) | Securities                classified as available-for-sale are included in average balances                and                interest income figures reflect interest earned on such                securities. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Interest                income of $1,012,414 for 2006 and $820,322 for 2005 is added to interest                earned on tax-exempt obligations to reflect tax-equivalent yields                using a                34% tax rate. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Interest                income includes loan fees of $2,611,267 for 2006 and $2,270,574 for                2005.                Nonaccrual loans are included in average balances and income on such                loans                is recognized on a cash basis. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

*Index*

**Table      4 - Changes in Taxable-Equivalent Net Interest Income**

**(in      thousands)**

|                                                                                                    |   | Nine                Months Ended                                 |   |
|---------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------|--------|
|                                                                                                    |   | September                30, 2006 compared to September 30, 2005 |   |
|                                                                                                    |   | Total                                                            |   | Change |   |
|                                                                                                    |   | Increase                                                         |   | Attributable                to |   |
|                                                                                                    |   | (Decrease)                                                       |   | Volume |   | Rates |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |
| Taxable-equivalent                interest earned on:                                                   |   |                                                             |   |   |   |   |   |
| Interest                Bearing Deposits                                                                |   | $                                                                | 9      |   | $ | 6 |   | $ | 3 |   |
| Investment                Securities                                                                    |   |                                                             |   |   |   |   |   |   |   |   |
| Taxable                                                                                                 |   |                                                             | 1,074  |   |   | 854 |   |   | 220 |   |
| Tax                Exempt                                                                               |   |                                                             | 644    |   |   | 548 |   |   | 96 |   |
| Equity                Securities                                                                        |   |                                                             | 4      |   |   | (6 | ) |   | 10 |   |
| Federal                Funds Sold and Securities Purchased Under Agreement to                Resell     |   |                                                             | 627    |   |   | 483 |   |   | 144 |   |
| Loans,                including fees                                                                    |   |                                                             | 6,811  |   |   | 3,787 |   |   | 3,024 |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |   |   |   |
| TOTAL                                                                                                   |   |                                                             | 9,169  |   |   | 5,672 |   |   | 3,497 |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |   |   |   |
| Interest                Paid On:                                                                        |   |                                                             |   |   |   |   |   |   |   |   |
| Interest                Bearing Deposits                                                                |   |                                                             | 4,955  |   |   | 1,368 |   |   | 3,587 |   |
| Federal                Funds Purchased and Securities Sold Under Agreement to                Repurchase |   |                                                             | 5      |   |   | (49 | ) |   | 54 |   |
| Federal                Home Loan Bank Advances                                                          |   |                                                             | (28    | ) |   | (28 | ) |   | - |   |
| Junior                Subordinated Debentures                                                           |   |                                                             | 117    |   |   | - |   |   | 117 |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |   |   |   |
| TOTAL                                                                                                   |   |                                                             | 5,049  |   |   | 1,291 |   |   | 3,758 |   |
|                                                                                                    |   |                                                             |   |   |   |   |   |   |   |   |
| Taxable-equivalent                net interest income                                                   |   | $                                                                | 4,120  |   | $ | 4,381 |   |   | ($261 | ) |

| NOTE: | Changes                due to both volume and rate has generally been allocated to volume                and                rate changes in proportion to the relationship of the absolute dollar                amounts to the changes in each. |
|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

*Index*

**Non-Interest      Income**

**Excluding      Securities Transactions **

**Securities      Transactions**

----

*Index*

**Non-interest      Expenses**

**Analysis      of Statement of Condition**

----

*Index*

|                                                   |   | September                30, 2006 |    | December                30, 2005 |   |
|--------------------------------------------------------|--------|-----------------------------------|---------|----------------------------------|--------|
| **Loan                Portfolio (in thousands)**       |   | Amount                            |    | Percent                          |   | Amount |   | Percent |   |
|                                                   |   |                              |    |                             |   |   |   |   |   |
| Commercial,                industrial and agricultural |   | $                                 | 171,351 |                             |   | 34.59 | %    | $ | 154,359 |   |   | 34.86 | % |
| Lease                financing receivable              |   |                              | 7,467   |                             |   | 1.51 | % |   | 6,108 |   |   | 1.38 | % |
| Real                estate - commercial                |   |                              | 126,369 |                             |   | 25.51 | % |   | 109,905 |   |   | 24.82 | % |
| Real                estate - mortgage                  |   |                              | 64,328  |                             |   | 12.99 | % |   | 60,990 |   |   | 13.77 | % |
| Real                estate - construction              |   |                              | 51,431  |                             |   | 10.38 | % |   | 39,202 |   |   | 8.85 | % |
| Consumer                                               |   |                              | 74,439  |                             |   | 15.03 | % |   | 72,230 |   |   | 16.31 | % |
| Total                loans                             |   | $                                 | 495,385 |                             |   | 100.00 | % | $ | 442,794 |   |   | 100.00 | % |

**Liquidity      **

----

*Index*

**Capital**

** **

**Asset      Quality**

**Credit      Risk Management**

**Nonperforming      Assets and Loans Past Due 90 Days and Over**

|                                                                                |   | Quarter                Ended Sept. 30, |   | %                Chg |   | Year                Ended Dec. 31, |                |
|-------------------------------------------------------------------------------------|--------|----------------------------------------|--------|----------------------|--------|------------------------------------|---------------------|
| (in                thousands)                                                       |   | 2006                                   |   | 2005                 |   |                               |                | 2005 |   |
|                                                                                |   |                                   |   |                 |   |                               |                |   |   |
| Nonaccrual                loans                                                     |   | $                                      | 501    |                 | $      | 2,125                              |                |   | -76.4 | %    | $ | 660 |   |
| Loans                past due 90 days and over                                      |   |                                   | 1,789  |                 |   | 561                                |                |   | 218.9 | % |   | 2,511 |   |
| Total                nonperforming loans                                            |   |                                   | 2,290  |                 |   | 2,686                              |                |   | -14.7 | % |   | 3,171 |   |
| Other                real estate owned                                              |   |                                   | 24     |                 |   | 111                                |                |   | -78.4 | % |   | 98 |   |
| Other                foreclosed assets                                              |   |                                   | 58     |                 |   | 154                                |                |   | -62.3 | % |   | 176 |   |
| Total                nonperforming assets                                           |   | $                                      | 2,372  |                 | $      | 2,951                              |                |   | -19.6 | % | $ | 3,445 |   |
|                                                                                |   |                                   |   |                 |   |                               |                |   |   |   |   |   |   |
| Nonperforming                assets to total assets                                 |   |                                   | 0.31   | %     |   | 0.45                               | %    |   | -31.1 | % |   | 0.49 | % |
| Nonperforming                assets to total loans + OREO + other foreclosed assets |   |                                   | 0.48   | %                    |   | 0.68                               | %                   |   | -29.4 | % |   | 0.78 | % |
| ALL                to nonperforming assets                                          |   |                                   | 207.00 | %                    |   | 142.70                             | %                   |   | 45.1 | % |   | 126.42 | % |
| ALL                to nonperforming loans                                           |   |                                   | 214.41 | %                    |   | 156.78                             | %                   |   | 36.8 | % |   | 137.34 | % |
| ALL                to total loans                                                   |   |                                   | 0.99   | %                    |   | 0.97                               | %                   |   | 2.1 | % |   | 0.98 | % |
|                                                                                |   |                                   |   |                 |   |                               |                |   |   |   |   |   |   |
| Year-to-date                charge-offs                                             |   | $                                      | 381    |                 | $      | 482                                |                |   | -21.0 | % | $ | 702 |   |
| Year-to-date                recoveries                                              |   |                                   | 266    |                 |   | 164                                |                |   | 62.2 | % |   | 226 |   |
| Year-to-date                net charge-offs                                         |   | $                                      | 115    |                 | $      | 318                                |                |   | -63.8 | % | $ | 476 |   |
| Net                YTD charge-offs to total loans                                   |   |                                   | 0.02   | %                    |   | 0.07                               | %                   |   | -71.4 | % |   | 0.11 | % |

----

*Index*

**Impact      of Inflation and Changing Prices**

----

*Index*

**Part      I. Item      3.  Qualitative and      Quantitative Disclosures About Market Risk**

**Part      I. Item 4.  Controls and      Procedures**

**Part      II.  Other      Information**

**Item      1.  Legal Proceedings**

----

*Index*

**Item      1.A.  Risk Factors - **

**Item      2.  Unregistered Sales of Equity      Securities and Use of Proceeds**

|                          | Total                Number                of                Shares Purchased | Average                Price Paid per Share | Total                Number of Shares Purchased as Part of a Publicly Announced                Plan1 | Maximum                Number of Shares That May Yet be Purchased Under the Plan1 |
|-------------------------------|-------------------------------------------------------------------------------|---------------------------------------------|------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------|
|                          |                                                                          |                                        |                                                                                                 |                                                                              |
| July                2006      | 3,257                                                                         | $22.88                                      | 3,257                                                                                                | 224,522                                                                           |
| August                2006    | 1,593                                                                         | $24.04                                      | 1,593                                                                                                | 221,265                                                                           |
| September                2006 | 908                                                                           | $26.42                                      | 908                                                                                                  | 220,357                                                                           |

**Item      3.  Defaults Upon Senior      Securities**

**Item4.  Submission      of Matters to a Vote      of Security Holders**

**Item      5.  Other      Information**

----

*Index*

**Item6.  Exhibits      and Reports on Form      8-K**

**(a)  Exhibits**

| Exihibit                Number |         Document                Description |
|--------------------------------|-------------------------------------------------------------------------------------|

| 11 | Computation                of earnings per share |
|----|--------------------------------------------------|

| 31.1 | Certification                pursuant to Exchange Act Rules 13(a) -                14(a) |
|------|------------------------------------------------------------------------------------------|

| 31.2 | Certification                pursuant to Exchange Act Rules 13(a) -                14(a) |
|------|------------------------------------------------------------------------------------------|

| 32.1 | Certification                pursuant to Section 906 of the Sarbanes-Oxley Act of                2002 |
|------|-------------------------------------------------------------------------------------------------------|

| 32.2 | Certification                pursuant to Section 906 of the Sarbanes-Oxley Act of                2002 |
|------|-------------------------------------------------------------------------------------------------------|

**(b)  Reports      Filed on Form      8-K**

----

*Index*

**Signatures**

|                                              | MidSouth                Bancorp, Inc.                            |
|---------------------------------------------------|------------------------------------------------------------------|
|                                              | (Registrant)                                                     |
|                                              |                                                             |
| Date:  November                10, 2006 |                                                             |
|                                              | /s/                C. R. Cloutier                                |
|                                              |                                                             |
|                                              | C.                R. Cloutier, President /CEO                    |
|                                              |                                                             |
|                                              | /s/                J. E. Corrigan, Jr.                           |
|                                              |                                                             |
|                                              | J.                E. Corrigan, Jr., Executive Vice President/CFO |
|                                              |                                                             |
|                                              | /s/                Teri S. Stelly                                |
|                                              |                                                             |
|                                              | Teri                S. Stelly, SVP/Controller                    |

----