<PAGE>

                      SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   Form 10-Q


[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000

[_]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _____ TO _____


                       Commission File Number: 000-24853


                         FRONTIER NATIONAL CORPORATION
             (Exact name of registrant as specified in its charter)


              Alabama                             72-1355228
      (State of Incorporation)          (IRS Employer Identification No.)



                                 43 N. Broadway
                              Sylacauga, AL 35150
                    (Address of Principal Executive Office)

                                  334-644-5419
                (Issuer's telephone number, including area code)



  (Former name, former address and former fiscal year, if changed since last
                                    report)


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

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

  Class A, Common Stock, $.001 par    Outstanding at October 31, 2000: 3,420,798
<PAGE>

                         FRONTIER NATIONAL CORPORATION

                          September 30, 2000 Form 10-Q


                               TABLE OF CONTENTS

                                                                        Page No.
                                                                        --------
Part 1. Financial Information

     Item 1. Financial Statements (Unaudited)

             Consolidated Balance Sheets                                    3

             Consolidated Statements of Income                              4

             Consolidated Statements of Comprehensive Income                5

             Consolidated Statements of Cash Flows                          6

             Consolidated Statement of Shareholders' Equity                 7

             Notes to Consolidated Financial Statements                   8 - 10

     Item 2. Management's Discussion and Analysis of                     11 - 15
              Financial Condition and Results of Operations

     Item 3. Quantitative and Qualitative Disclosures About
              Market Risk                                                   16

Part 2. Other Information

     Item 1. Legal Proceedings                                           17 - 18

     Item 6. Exhibits and Reports on Form 8-K                               18


                                       2
<PAGE>

PART 1. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS

                FRONTIER NATIONAL CORPORATION AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>

                                                                          September 30, 2000      December 31, 1999
                                                                          ------------------      -----------------
                                                                              (Unaudited)
<S>                                                                       <C>                     <C>
 ASSETS
 CASH AND DUE FROM BANKS                                                       $  7,728,075         $  6,902,010
 INTEREST BEARING DEPOSITS WITH OTHER BANKS                                         355,477              102,066
 FEDERAL FUNDS SOLD                                                                       -            6,640,000
 SECURITIES AVAILABLE FOR SALE                                                   43,298,035           50,357,787
 LOANS, NET OF UNEARNED INCOME                                                  159,064,451          139,706,383
 ALLOWANCE FOR LOAN LOSSES                                                       (1,979,293)          (1,849,356)
 PREMISES AND EQUIPMENT, NET                                                      8,241,806            6,806,237
 ACCRUED INTEREST RECEIVABLE                                                      1,959,082            1,651,255
 CASH SURRENDER VALUE ON LIFE INSURANCE                                           5,256,194            5,073,986
 INTANGIBLE ASSETS, NET                                                           1,401,736            1,497,013
 FORECLOSED REAL ESTATE                                                             256,107              305,965
 OTHER ASSETS                                                                     1,922,510            2,021,807
                                                                               ------------         ------------
    TOTAL ASSETS                                                               $227,504,180         $219,215,153
                                                                               ============         ============

 LIABILITIES AND SHAREHOLDERS' EQUITY
 LIABILITIES
  DEPOSITS:
   NONINTEREST BEARING DEPOSITS                                                $ 25,292,913         $ 24,512,607
   INTEREST BEARING DEPOSITS                                                    152,163,509          147,914,373
                                                                               ------------         ------------
      TOTAL DEPOSITS                                                            177,456,422          172,426,980
                                                                               ------------         ------------
  FEDERAL FUNDS PURCHASED                                                           300,000                    -
  DIVIDENDS PAYABLE                                                                       -              438,697
  ACCRUED INTEREST PAYABLE                                                        1,247,406              925,364
  LONG-TERM DEBT                                                                 25,442,000           24,042,000
  OTHER LIABILITIES                                                               1,529,833            1,190,927
                                                                               ------------         ------------
    TOTAL LIABILITIES                                                           205,975,661          199,023,968
                                                                               ------------         ------------

 SHAREHOLDERS' EQUITY
  COMMON STOCK ($.001 PAR VALUE; 10,000,000 SHARES
   AUTHORIZED, 3,497,497 ISSUED OF WHICH 3,418,243 ARE
   OUTSTANDING AT SEPTEMBER 30, 2000; $.001 PAR VALUE,
   10,000,000 SHARES AUTHORIZED, 3,497,497 ISSUED OF WHICH
   3,414,357 WERE OUTSTANDING AT DECEMBER 31, 1999)                                   3,498                3,498
  CAPITAL SURPLUS                                                                14,249,151           14,263,104
  RETAINED EARNINGS                                                               9,337,255            8,774,744
  TREASURY STOCK, AT COST (79,254 SHARES AT SEPTEMBER 30,
   2000 AND 83,140 SHARES AT DECEMBER 31, 1999)                                  (1,103,421)          (1,170,483)
  ACCUMULATED COMPREHENSIVE INCOME (LOSS): NET UNREALIZED
   HOLDING GAINS ON SECURITIES AVAILABLE FOR SALE,
   NET OF DEFERRED INCOME TAX                                                      (957,964)          (1,679,678)
                                                                               ------------         ------------
     TOTAL STOCKHOLDERS' EQUITY                                                  21,528,519           20,191,185
                                                                               ============         ============
    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                 $227,504,180         $219,215,153
                                                                               ============         ============


</TABLE>
                SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



                                       3
<PAGE>

                FRONTIER NATIONAL CORPORATION AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF INCOME
                                  (UNAUDITED)

<TABLE>
<CAPTION>

                                                                     THREE MONTHS ENDED                 NINE MONTHS ENDED
                                                                        SEPTEMBER 30                       SEPTEMBER 30
                                                                 ---------------------------       ----------------------------
                                                                     2000             1999             2000             1999
                                                                 ----------       ----------       -----------      -----------
<S>                                                              <C>              <C>              <C>              <C>
INTEREST INCOME
       INTEREST AND FEES ON LOANS                                $3,780,934       $3,118,543       $11,071,919      $ 9,516,084
       INTEREST AND DIVIDENDS ON SECURITIES
         TAXABLE SECURITIES                                         419,675          536,212         1,327,728        1,533,165
         NONTAXABLE SECURITIES                                      273,770          292,659           900,734          816,514
       INTEREST EARNED ON DEPOSITS WITH OTHER BANKS                   4,002           10,201            18,474           40,417
       INTEREST EARNED ON FEDERAL FUNDS SOLD                          8,839           90,442           112,944          523,232
                                                                 ----------       ----------       -----------      -----------
         TOTAL INTEREST INCOME                                    4,487,220        4,048,057        13,431,799       12,429,412

INTEREST EXPENSE
       INTEREST ON DEPOSITS                                       1,796,466        1,497,523         5,148,776        4,669,834
       INTEREST ON BORROWED FUNDS                                   413,012          312,805         1,182,636          910,338
                                                                 ----------       ----------       -----------      -----------
         TOTAL INTEREST EXPENSE                                   2,209,478        1,810,328         6,331,412        5,580,172

         NET INTEREST INCOME                                      2,277,742        2,237,729         7,100,387        6,849,240
           PROVISION FOR LOAN LOSSES                               (243,853)        (103,820)         (470,616)        (482,599)
                                                                 ----------       ----------       -----------      -----------
         NET INTEREST INCOME AFTER
           PROVISION FOR LOAN LOSSES                              2,033,889        2,133,909         6,629,771        6,366,641

NONINTEREST INCOME
       SERVICE CHARGES ON DEPOSIT ACCOUNTS                          471,678          367,687         1,232,029        1,089,651
       COMMISSION INCOME                                            385,566          259,544         1,125,013          847,975
       OTHER OPERATING INCOME                                        71,081          102,128           317,623          336,257
       SECURITIES GAINS (LOSSES)                                     (4,056)          39,004            (1,142)          39,022
                                                                 ----------       ----------       -----------      -----------
         TOTAL NONINTEREST INCOME                                   924,269          768,363         2,673,523        2,312,905

NONINTEREST EXPENSE
       SALARIES AND EMPLOYEE BENEFITS                             1,222,008        1,101,091         3,451,928        3,244,966
       NET OCCUPANCY EXPENSE                                        441,661          365,715         1,214,555        1,026,885
       OTHER OPERATING EXPENSES                                     873,348          663,991         2,183,734        2,069,275
                                                                 ----------       ----------       -----------      -----------
         TOTAL NONINTEREST EXPENSES                               2,537,017        2,130,797         6,850,217        6,341,126

         INCOME BEFORE INCOME TAXES                                 421,141          771,475         2,453,077        2,338,420
         PROVISION FOR INCOME TAXES                                   7,385         (260,082)         (583,357)        (635,822)
                                                                 ----------       ----------       -----------      -----------
           NET INCOME                                            $  428,526       $  511,393       $ 1,869,720      $ 1,702,598
                                                                 ==========       ==========       ===========      ===========
BASIC EARNINGS PER COMMON SHARE                                  $     0.13       $     0.15       $      0.55      $      0.49
BASIC WEIGHTED AVERAGE SHARES OUTSTANDING                         3,418,243        3,440,010         3,416,748        3,460,060
EARNINGS PER COMMON SHARE ASSUMING DILUTION                      $     0.12       $     0.15       $      0.54      $      0.49
WEIGHTED AVERAGE SHARES
    OUTSTANDING ASSUMING DILUTION                                 3,492,566        3,485,010         3,485,083        3,505,060
</TABLE>

                SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       4
<PAGE>

                FRONTIER NATIONAL CORPORATION AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                                  (UNAUDITED)

<TABLE>
<CAPTION>

                                                                THREE MONTHS ENDED                 NINE MONTHS ENDED
                                                                   SEPTEMBER 30                       SEPTEMBER 30
                                                             -------------------------        ----------------------------
                                                               2000            1999              2000             1999
                                                             ---------       ---------        ----------       -----------
<S>                                                          <C>             <C>              <C>              <C>
NET INCOME                                                   $ 428,526       $ 511,393        $1,869,720       $ 1,702,598
OTHER COMPREHENSIVE, NET OF TAX:
     UNREALIZED GAINS (LOSSES) ON SECURITIES:
        UNREALIZED HOLDING GAINS (LOSSES) ARISING
             DURING THE PERIOD                                 867,773        (863,485)        1,149,773        (2,467,574)
        LESS:  RECLASSIFICATION ADJUSTMENTS FOR
            (GAINS) LOSSES INCLUDED IN NET INCOME                4,056         (39,004)            1,142           (39,022)
                                                             ---------       ---------        ----------       -----------
        NET UNREALIZED GAINS (LOSSES)                          871,829        (902,489)        1,150,915        (2,506,596)
     INCOME TAX RELATED TO ITEMS OF OTHER
             COMPREHENSIVE INCOME (LOSS)                      (327,376)        309,681          (429,201)          924,146
                                                             ---------       ---------        ----------       -----------

OTHER COMPREHENSIVE INCOME (LOSS)                              544,453        (592,808)          721,714        (1,582,450)
                                                             ---------       ---------        ----------       -----------

COMPREHENSIVE INCOME (LOSS)                                  $ 972,979       $ (81,415)       $2,591,434       $   120,148
                                                             =========       =========        ==========       ===========
</TABLE>

                SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       5
<PAGE>

                FRONTIER NATIONAL CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                          NINE MONTHS ENDED
                                                                                             SEPTEMBER 30
                                                                                    --------------------------------
                                                                                        2000                1999
                                                                                    ------------        ------------
<S>                                                                                 <C>                 <C>
OPERATING ACTIVITIES:
  NET CASH PROVIDED BY OPERATING ACTIVITIES                                         $  2,700,428        $  2,991,240

INVESTING ACTIVITIES:
 PROCEEDS FROM SALES OF SECURITIES AVAILABLE FOR SALE                                  8,482,535          16,306,555
 PURCHASES OF SECURITIES AVAILABLE FOR SALE                                             (250,000)        (20,703,780)
 NET (INCREASE) DECREASE IN LOANS TO CUSTOMERS                                       (19,833,701)          4,278,523
 PURCHASES OF PREMISES AND EQUIPMENT                                                  (1,958,094)         (1,391,968)
 PROCEEDS FROM SALES OF FIXED ASSETS                                                           -             156,788
 PROCEEDS FROM SALE OF FORECLOSED REAL ESTATE                                            148,941                   -
                                                                                    ------------        ------------
  NET CASH USED BY INVESTING ACTIVITIES                                              (13,410,319)         (1,353,882)
                                                                                    ------------        ------------

FINANCING ACTIVITIES:
 NET INCREASE (DECREASE) IN DEPOSITS                                                   5,029,441          (5,169,310)
 NET INCREASE IN SHORT-TERM BORROWINGS                                                   412,722             473,836
 DIVIDENDS PAID                                                                       (1,745,905)         (1,319,207)
 PROCEEDS FROM SALE OF TREASURY STOCK                                                     91,609                   -
 TREASURY STOCK PURCHASED                                                                (38,500)           (545,417)
 PROCEEDS FROM NOTES PAYABLE, NET                                                      1,400,000           5,500,000
                                                                                    ------------        ------------
  NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES                                     5,149,367          (1,060,098)
                                                                                    ------------        ------------

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS                                  (5,560,524)            577,260

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                      13,644,076          14,836,223
                                                                                    ------------        ------------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                                          $  8,083,552        $ 15,413,483
                                                                                    ============        ============
</TABLE>


                SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       6
<PAGE>

                FRONTIER NATIONAL CORPORATION AND SUBSIDIARIES
                CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                     NINE MONTHS ENDED SEPTEMBER 30, 2000
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                         ACCUMULATED
                                    COMMON      CAPITAL       RETAINED      TREASURY    COMPREHENSIVE
                                     STOCK      SURPLUS       EARNINGS       STOCK      INCOME (LOSS)      TOTAL
                                    ------   -----------   -----------   -----------    ------------   -----------
<S>                                 <C>      <C>           <C>           <C>            <C>            <C>
BALANCE AT
  DECEMBER 31, 1999                 $3,498   $14,263,104   $ 8,774,744   $(1,170,483)   $(1,679,678)   $20,191,185

CASH DIVIDENDS -
  COMMON                                 -             -    (1,307,209)            -               -    (1,307,209)

PURCHASE OF TREASURY STOCK               -             -             -       (38,500)              -       (38,500)

REISSUANCE OF TREASURY STOCK             -       (13,953)            -       105,562               -        91,609

NET CHANGE IN
  UNREALIZED GAINS (LOSSES)
  ON SECURITIES                          -             -             -             -         721,714       721,714

NET INCOME - SEPTEMBER 30, 2000          -             -     1,869,720             -               -     1,869,720
                                    ------   -----------   -----------   -----------    ------------   -----------
BALANCE AT
  SEPTEMBER 30, 2000                $3,498   $14,249,151   $ 9,337,255   $(1,103,421)   $  (957,964)   $21,528,519
                                    ======   ===========   ===========   ===========    ===========    ===========

</TABLE>

                SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                       7
<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FRONTIER NATIONAL CORPORATION AND SUBSIDIARIES
                               SEPTEMBER 30, 2000
                                  (UNAUDITED)


NOTE A - Basis of Presentation

The consolidated financial statements include the accounts of Frontier National
Corporation (the "Company") and its wholly-owned subsidiaries, Frontier National
Bank, Lanett, Alabama, Frontier National Bank, Sylacauga, Alabama, Frontier
Financial Services, Inc., and The Frontier Agency, Inc., collectively, the Bank.
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X.  Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements.  In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included.  Operating results for the nine-month period ended September 30,
2000, are not necessarily indicative of the results that may be expected for the
year ending December 31, 2000.  For further information, refer to the
consolidated financial statements and footnotes thereto for Frontier National
Corporation and subsidiaries for the year ended December 31, 1999, included in
Form 10-K filed in March 2000.

NOTE B - Income Taxes

The effective tax rates of approximately 24 percent and 27 percent for the nine
months ended September 30, 2000 and 1999, respectively, are less than the
statutory rate principally because of the effect of tax-exempt interest income.

NOTE C - Securities

The Company applies the accounting and reporting requirements of Statement of
Financial Accounting Standards No. 115, Accounting for Certain Investments in
Debt and Equity Securities ("SFAS115").  This pronouncement requires that all
investments in debt securities be classified as either "held-to-maturity"
securities, which are reported at amortized cost; trading securities, which are
reported at fair value, with unrealized gains and losses included in earnings;
or "available-for-sale" securities, which are reported at fair value, with
unrealized gains and losses excluded from earnings and reported in a separate
component of shareholders' equity (net of deferred tax effect).

At September 30, 2000, the Company had net unrealized losses of $1,557,488 in
available-for-sale securities that are reflected in the presented assets and
resulted in a decrease in shareholders' equity of $957,964, net of deferred tax
asset.  There were no trading securities.

                                       8
<PAGE>

The net increase in shareholders' equity as a result of the SFAS 115 adjustment
from December 31, 1999 to September 30, 2000 was $721,714.  See also Note D -
Shareholders' Equity.

NOTE D - Shareholders' Equity

During the first nine months of 2000, cash dividends of $1,307,209 were charged
against equity.  Equity was increased by $721,714 for the decrease in net
unrealized losses on securities.  Treasury stock was purchased during the first
quarter decreasing shareholders' equity $38,500.  Treasury stock was also
reissued increasing shareholders' equity $91,609.

NOTE E - Treasury Stock

During the first nine months of 2000, 3,000 shares of common stock were acquired
and placed in treasury at cost and 6,886 were reissued and accounted for on a
first-in-first-out method.  The treasury stock balance represents 83,140 shares
at December 31, 1999 and 79,254 shares at September 30, 2000.

NOTE F - Segment Reporting

All of the Company's offices offer similar products and services, are located in
the same geographic region, and serve the same customer segments of the market.
As a result, management considers all units as one operating segment and
therefore feels that the basic financial statements and related footnotes
provide details related to segment reporting.

NOTE G - Forward-Looking Statements

Certain statements in this report are forward-looking in nature and relate to
trends and events that may affect the Company's future financial position and
operating results.  Such statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.  The terms
"expect," "anticipate," "intend," and "project" and similar words or expressions
are intended to identify forward-looking statements.  These statements speak
only as of the date of this report.  The statements are based on current
expectations, are inherently uncertain, are subject to risks, and should be
viewed with caution.  Actual results and experience may differ materially from
the forward-looking statements as a result of many factors, including changes in
economic conditions in the markets served by the Company, increasing competition
and other unanticipated events and conditions.  It is not possible to foresee or
identify all such factors. The Company makes no commitment to update any
forward-looking statements or to disclose any facts, events, or circumstances
after the date hereof that may affect the accuracy of any forward- looking
statement.

NOTE H - Stock Options

Officers of the company hold a total of 191,000 incentive stock options at
various exercise prices all of which are the fair market value on the various
grant dates.  These options vest over a five-year time period at 20% on each
anniversary of the grant date and expire ten years from the grant date.

Directors of the Company hold a total of 27,500 nonqualified stock options at
various exercise prices all of which are the fair market value on the grant
date.  These options are immediately

                                       9
<PAGE>

exercisable and expire on the one-year anniversary date of the director's
termination of service to the Board.

                                       10
<PAGE>

Item 2.   Management's Discussion and Analysis of Financial Condition and
Results of Operations

This discussion is intended to assist an understanding of the Company and its
Subsidiaries' financial condition and results of operations.  Unless the context
otherwise indicates, "the Company" shall include the Company and its
Subsidiaries.  This analysis should be read in conjunction with the consolidated
financial statements and related notes appearing in Item 1 of the September 30,
2000 Form 10-Q.

FINANCIAL CONDITION

September 30, 2000 compared to December 31, 1999

Loans

Loans comprised the largest single category of the Company's earning assets on
September 30, 2000.  Loans, net of unearned income and reserve for loan losses,
were 69.05% of total assets at September 30, 2000 and 62.89% of total assets at
December 31, 1999.  Total net loans were $157,085,158 at September 30, 2000,
representing a 13.95% increase from the December 31, 1999 total of $137,857,027.
This increase is the result of loan growth since December 31, 1999.

Investment Securities and Other Earning Assets

The investment securities portfolio is used to make various term investments, to
provide a source of liquidity and to serve as collateral to secure certain
government deposits.  Federal funds sold are a tool in managing the daily cash
position of the Company.  Investment securities and federal funds sold decreased
$13,699,752 from December 31, 1999 to September 30, 2000.  Investment securities
and federal funds sold at September 30, 2000 were $43,298,035 compared with
$56,997,787 at December 31, 1999, reflecting a 24.04% decrease.

Asset Quality

Between December 31, 1999 and September 30, 2000, the Company experienced a
decrease in nonperforming assets (defined as nonaccrual loans, loans past due 90
days or more, restructured loans, nonaccruing securities, and other real estate)
from $1.894 million to $1.746 million. The ratio of loan loss allowance to total
nonperforming assets increased from .98 to 1.13, the ratio of nonperforming
loans to total loans remained constant at .011. All of these ratios are
favorable as compared to industry averages.  Classified assets are defined as
loans that are subject to general financial duress or deterioration of the
collateral securing the assets.  Classified assets are not considered
nonperforming assets.  The company did experience an increase in classified
assets during the quarter that could be indicative of a potential increase in
nonperforming assets in future periods.

Deposits

Total deposits of $177,456,422 at September 30, 2000 increased $5,029,442
(2.92%) over total deposits of $172,426,980 at year-end 1999.  Deposits are the
Company's primary source of funds with which to support its earning assets.
Non-interest bearing deposits increased $780,306 or 3.18% from year-end 1999 to
September 30, 2000, and interest bearing deposits increased $4,249,136 (2.87%)
from year-end 1999.

                                       11
<PAGE>

Long-term Debt

At September 30, 2000 and December 31, 1999, the Company had notes payable
totaling $25,442,000, and $24,042,000, respectively.

Maturities of long-term debt for the years ending December 31 are as follows:
<TABLE>
<CAPTION>

          <S>                      <C>
          2000                     $         -
          2001                         350,000
          2002                               -
          2003                               -
          2004                       5,500,000
          Thereafter                19,592,000
                                   -----------
          Total                    $25,442,000
                                   ===========

</TABLE>
Shareholders' Equity

Company shareholders' equity increased $1,337,334 from December 31, 1999 to
September 30, 2000, due to net income of $1,869,720, the declaration of cash
dividends of $1,307,209, the decrease of unrealized losses on securities
available-for-sale totaling $721,714 net of deferred tax asset, the purchase of
treasury stock of $38,500 and the reissuance of treasury stock of $91,609.

Liquidity Management

Liquidity is defined as the ability of a company to convert assets into cash or
cash equivalents without significant loss.   Liquidity management involves
maintaining the Banks' ability to meet the day-to-day cash flow requirements of
its customers, whether they are depositors wishing to withdraw funds or
borrowers requiring funds to meet their credit needs.  Without proper liquidity
management, the Bank would not be able to perform the primary function of a
financial intermediary and would, therefore, not be able to meet the production
and growth needs of the communities it serves.

The primary function of asset and liability management is not only to assure
adequate liquidity in order for the Bank to meet the needs of its customer base,
but to maintain an appropriate balance between interest-sensitive assets and
interest-sensitive liabilities so that the Bank can also meet the investment
requirements of its shareholders.  Daily monitoring of the sources and uses of
funds is necessary to maintain an acceptable cash position that meets both
requirements.  In the banking environment, both assets and liabilities are
considered sources of liquidity funding and both are, therefore, monitored on a
daily basis.

The asset portion of the balance sheet provides liquidity primarily through loan
principal repayments and sales of investment and trading account securities.
Loans that mature in one year or less equaled approximately $47.046 million or
29.58% of the total loan portfolio at September 30, 2000 and there are no
investment securities maturing within one year.  Other sources of liquidity
include short-term investments such as federal funds sold.

                                       12
<PAGE>

The liability portion of the balance sheet provides liquidity through various
customers' interest bearing and non-interest bearing deposit accounts.  At
September 30, 2000, funds were also available through the purchase of federal
funds from correspondent commercial banks from available lines of up to an
aggregate of $14,000,000.  Each of the Company's subsidiary banks is a member of
the Federal Home Loan Bank of Atlanta.  Membership provides the Company with
additional lines of credit for liquidity needs.  The Company has also
established a line of credit under the parent company for $5,000,000.

Capital Resources

A strong capital position is vital to the continued profitability of the Company
because it promotes depositor and investor confidence and provides a solid
foundation for future growth of the organization.  The Company has provided the
majority of its capital requirements through the retention of earnings.

Bank regulatory authorities are placing increased emphasis on the maintenance of
adequate capital.  In 1990, new risk-based capital requirements became
effective.  The guidelines take into consideration risk factors, as defined by
regulators, associated with various categories of assets, both on and off the
balance sheet.  Under the guidelines, capital strength is measured in two tiers
which are used in conjunction with risk-adjusted assets to determine the risk-
based capital ratios.  The Company's Tier I capital, which consists of common
equity less goodwill, amounted to approximately $21,087,000 at September 30,
2000.  Tier II capital components include supplemental capital components such
as qualifying allowance for loan losses and qualifying subordinated debt.  Tier
I capital plus the Tier II capital components are referred to as Total Risk-
Based capital and was approximately $23,066,000 at September 30, 2000.

The Company's current capital positions exceed the regulatory guidelines.
Management has reviewed and will continue to monitor the Company's asset mix and
product pricing, and the loan loss allowance, which are the areas determined to
be most affected by these requirements.

RESULTS OF OPERATIONS

Nine months and Three months ended September 30, 2000 and 1999

Summary

Net earnings of the Company for the nine months ended September 30, 2000 were
$1,869,720 compared to $1,702,598 for the same period in 1999, representing a
9.82% increase.  This increase was due to a 4.13% increase in net interest
income after provision for loan losses primarily a result of loan growth coupled
with decreases in loan loss provisions, an increase in noninterest income of
15.59% primarily from nonbank subsidiaries, and expense control that held
noninterest expenses to an increase of 8.03%.

Net earnings of the Company for the three months ended September 30, 2000 were
$428,526 compared to $511,393 for the same period in 1999, representing a
decrease of 16.20%.  The decrease is attributable to an increase in provision
for loan losses during the third quarter of 2000 of $140,033 over the third
quarter of 1999 coupled with an increase in noninterest expenses during the
quarter and offset by an increase in noninterest income, net interest income and
a decrease in provision for income taxes.

                                       13
<PAGE>

Net Interest Income

Net interest income, the difference between interest earned on assets and the
cost of interest-bearing liabilities, is the largest component of the Company's
net income.  Revenue from earning assets of the Company during the nine months
ended September 30, 2000 increased $1,002,387 (8.06%) from the same period in
1999.  This increase was due to higher average outstanding balances of earning
assets and increased rates earned on those assets. Interest expense for the nine
months ended September 30, 2000 increased $751,240 or 13.46% over the
corresponding period of 1999.  As a result of these factors, net interest income
increased $251,147 or 3.67% in the nine months ended September 30, 2000,
compared to the same period of 1999.

Revenue from earning assets of the Company during the three months ended
September 30, 2000 increased $439,163 (10.85%) from the same period in 1999.
This increase was also due to higher average outstanding balances of earning
assets and higher rates earned on those assets. Interest expense for the three
months ended September 30, 2000 increased $399,150 or 22.05% over the
corresponding period of 1999.  As a result of these factors, net interest income
increased $40,013 or 1.79% in the three months ended September 30, 2000,
compared to the same period of 1999.

Provision for Loan Losses

The provision for loan losses represents the charge against current earnings
necessary to maintain the reserve for loan losses at a level which management
considers appropriate.  This level is determined based upon the Company's
historical charge-offs, management's assessment of current economic conditions,
the composition of the loan portfolio and the levels of nonaccruing and past due
loans.  The provision for loan losses was $470,616 for the nine months ended
September 30, 2000 compared to $482,599 for the same period of 1999.  Charge-
offs exceeded recoveries by approximately $341,000 for the nine months ended
September 30, 2000.  The reserve for loan losses as a percent of outstanding
loans, net of unearned income, was 1.24% at September 30, 2000 compared to 1.32%
at year-end 1999.

The provision for loan losses for the three month period ended September 30,
2000 was $243,853 compared to $103,820 for the same period of 1999 representing
a $140,033 increase.  This  increase in the provision for loan losses is a
result of a decrease in recoveries as compared to the same period in 1999,
growth in the loan portfolio, and the deterioration of a single credit during
the quarter resulting in a higher reserve requirement for that credit.

Noninterest Income

Noninterest income for the nine months ended September 30, 2000 was $2,673,523
compared to $2,312,905 for the same period of 1999.  This 15.59% increase was
primarily due to commission income of $1,125,013 in the first nine months of
2000 as compared to $847,975 in the same period of 1999.  Changes in the
components of noninterest income are as follows: Service charges on deposits
increased $142,378 (13.07%), insurance commissions increased $277,038, other
operating income decreased $18,634 and securities gains or losses decreased
noninterest income by $40,164.

Noninterest income for the three months ended September 30, 2000, increased
$155,906 or 20.29%.  The primary result of this increase is from increased
service charge income of $103,991 and increased commission income of $126,022.

                                       14
<PAGE>

Noninterest Expenses

Noninterest expenses for the nine months ended September 30, 2000 were
$6,850,217 reflecting a 8.03% increase over the same period of 1999.  The
primary components of noninterest expenses are salaries and employee benefits,
which increased to $3,451,928 for the nine months ended September 30, 2000,
6.38% higher than in the same period of 1999.  Occupancy costs increased
$187,670 and other operating expenses increased $114,459.

Noninterest expenses for the three months ended September 30, 2000 were
$2,537,017 reflecting a 19.06% increase over the same period of 1999.  The
primary components of noninterest expenses are salaries and employee benefits,
which increased $120,917 for the three months ended September 30, 2000, 10.98%
higher than in the same period of 1999.  Occupancy costs increased $75,946 and
other operating expenses increased $209,357.

Income Taxes

The Company attempts to maximize its net income through active tax planning.
The provision for income taxes of $583,357 for the nine months ended September
30, 2000 decreased $52,465 compared to the same period of 1999.  Taxes as a
percent of earnings decreased from 27.19% to 23.78%.  The effective tax rate of
approximately 24% is less than the statutory rate principally because of the
effect of tax-exempt interest income.

Year 2000 Issues

The Year 2000 issue was the result of shortcomings in many electronic data
processing systems and other electronic equipment that could have adversely
affected the Company's operations as early as fiscal year 1999.

The Company completed an inventory of computer systems and other electronic
equipment that could have been affected by the Year 2000 issue and that were
necessary to conducting the Company's operations. Based on this inventory, the
Company upgraded or replaced various software and hardware items and then tested
and validated them for Year 2000 compliance.

Expenses for Year 2000 issues in 1999 were negligible and the Company's
management does not believe that any Year 2000 issues will affect the financial
condition or results of operations in 2000.

                                       15
<PAGE>

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

Market risk is the risk arising from adverse changes in the fair value of
financial instruments due to a change in interest rates, exchange rates and
equity prices.  Frontiers' primary risk is interest rate risk.

The primary objective of Asset/Liability Management at Frontier is to manage
interest rate risk and achieve reasonable stability in net interest income
throughout interest rate cycles.  This is achieved by maintaining the proper
balance of rate sensitive earning assets and rate sensitive liabilities.  The
relationship of rate sensitive earning assets to rate sensitive liabilities is
the principal factor in projecting the effect that fluctuating interest rates
will have on future net interest income.  Rate sensitive earning assets and
interest-bearing liabilities are those that can be repriced to current market
rates within a relatively short time period.  Management monitors the rate
sensitivity of earning assets and interest-bearing liabilities over the entire
life of these instruments, but places particular emphasis on the first year and
through three years.  Frontier's Asset/Liability Management policy requires
cumulative gap (the ratio of rate sensitive assets to rate sensitive
liabilities) to stay within a +/-20%.

Frontier has not experienced a high level of volatility in net interest income
primarily because of the relatively large base of core deposits that do not
reprice on a contractual basis.  These deposit products include regular savings,
interest-bearing transaction accounts and money market savings accounts.
Balances for these accounts are reported based on historical repricing
experienced at each bank.  However, the rates paid are typically not directly
related to market interest rates, since management has some discretion in
adjusting these rates as market rates change.

Frontier uses additional tools to monitor and manage interest rate sensitivity.
One of the primary tools is simulation analysis.  Simulation analysis is the
primary method of estimating earnings at risk and capital at risk under varying
interest rate conditions.  Simulation analysis is used to test the sensitivity
of Frontier's net interest income and stockholders' equity to both the level of
interest rates and the slope of the yield curve.  Simulation analysis accounts
for the expected timing and magnitude of assets and liability cash flows, as
well as the expected timing and magnitude of deposits that do not reprice on a
contractual basis. In addition, simulation analysis includes adjustments for the
lag between movements in market interest rates on loans and interest-bearing
deposits.  These adjustments are made to reflect more accurately possible future
cash flows, repricing behavior and ultimately net interest income. Net income is
not materially impacted during simulation analysis under different rate
scenarios.

                                       16
<PAGE>

PART 2.  OTHER INFORMATION

     Item 1. Legal Proceedings

     1.  Clarence Ray Vincent and Vickie Lynn Vincent v. First National -
         ----------------------------------------------------------------
     America's Bank, et al., Case No. CV 99-466.  This action was filed on
     ----------------------
     October 1, 1999 in the Circuit Court of Talladega County, Alabama.  The
     Complaint alleges that Mr. Vincent was told that he had to obtain certain
     insurance in order for him to obtain credit from the Bank and that Mr.
     Vincent was required to pay charges in excess of those permitted by law.
     The Bank has denied any wrongdoing and its attorneys are vigorously
     defending this action.

     The parties are engaged in discovery.  The Bank's attorneys have filed a
     motion for summary judgment seeking dismissal of this case prior to the
     necessity of a jury trial. The parties are discussing settlement and it is
     likely that this matter will shortly be concluded.  In the event that it
     cannot be successfully resolved by agreement, the Bank is confident that it
     will prevail.


     2.  Brenda Andrews v. Valley National Corporation a/k/a Valley National
         -------------------------------------------------------------------
     Bank; et al., Case No. CV 00-160, pending in the Circuit Court of Chambers
     ------------
     County, Alabama.  This action was filed on July 14, 2000.  Ms. Andrews
     alleges a number of claims against the Company and its Chief Executive
     Officer and Chief Financial Officer in her Complaint, including negligent
     hiring, wanton hiring, and civil conspiracy, which all essentially arise
     out of her main claim, that her employment was unlawfully terminated
     because of her age. Although discovery has just commenced in this action
     and it is too early to state with certainty any details about its possible
     outcome, the Company vigorously denies any and all wrongdoing. The Company
     is vigorously defending this action and is hopeful that these claims will
     soon be dismissed. The plaintiff's deposition is scheduled for November 13,
     2000.

     3.  Frontier National Corporation v. Wanda Faye Johnson and Carol Turnham,
         ---------------------------------------------------------------------
     Case No. CV 2000-454, pending in the Circuit Court of Talladega County,
     Alabama.  Carol Turnham and Wanda Faye Johnson are former employees of
     Valley National Bank.  Their employment was terminated by the Company
     pursuant to a reduction in force.  On August 25, 2000, the Company was
     served with a demand letter from an attorney for Johnson and Turnham.  The
     letter alleged that the employees were terminated based upon their age in
     violation of the Alabama Age Discrimination in Employment Act ("ADEA").
     The company vehemently denies that the employment decisions affecting these
     two employees were based upon age.  Given the disputed issue, the Company
     filed a Declaratory Judgment action in Talladega County on August 29, 2000,
     seeking to have the Court rule that the Company is in no way liable to the
     former employees.  The employees have filed a motion to have the case
     transferred to Chambers County and we have noticed their depositions.
     Given that the case is in this early stage, we are unable to assess with
     certainty the potential for liability, but we intend to vigorously defend
     the Company's position and aggressively challenge the Plaintiffs' claims.

     4. Cagle's Inc. v. Valley National Bank, Case No. 00-A-851-E.  On June 30,
        ------------------------------------
     2000, a complaint alleging breach of duty, negligence and gross negligence
     against Frontier National Bank, Lanett, Alabama in connection with its
     acceptance for deposit of five

                                       17
<PAGE>

     checks totaling $1,138,611 was filed in federal court in Alabama.  The
     plaintiff, a publicly traded poultry processing concern, alleges that the
     Bank knew or should have known that the checks were not authorized.  The
     plaintiff seeks unspecified compensatory and punitive damages and attorney
     fees, although it has apparently recovered $800,000 to $900,000 from the
     Bank's depositor.  The Bank denies any liability and intends to defend
     against the allegations vigorously.

     Item 6.   Exhibits and Reports on Form 8-K

     (a)  Exhibits

          Exhibit 11 - Statement RE: Computation of Earnings per Share

          Exhibit 27 - Financial Data Schedule

     (b)  Reports on Form 8-K

          During the quarter ended September 30, 2000, no reports were filed for
          Frontier National Corporation on Form 8-K.

                                       18
<PAGE>

                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                    FRONTIER NATIONAL CORPORATION

November 14, 2000                   By:  /s/  STEVEN R. TOWNSON
                                        ----------------------------------
                                    Steven R. Townson
                                    President, Chief Executive Officer and
                                    Chief Financial Officer

                                       19