----

----

| x | Quarterly Report Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934 |
|---|-----------------------------------------------------------------------------------------|

| o | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
|---|------------------------------------------------------------------------------------------|

|                                                   | FSB Community Bankshares, Inc. |   |
|--------------------------------------------------------|--------------------------------|--------|
| (Exact name of registrant as specified in its charter) |

|   | United States                                                 |   | 74-3164710                             |   |
|--------|---------------------------------------------------------------|--------|----------------------------------------|--------|
|   | (State or other jurisdiction ofincorporation or organization) |   | (I.R.S. EmployerIdentification Number) |   |

|   | 45 South Main Street, Fairport, New York |   | 14450    |   |
|--------|------------------------------------------|--------|----------|--------|
|   | (Address of Principal Executive Offices) |   | Zip Code |   |

|                                  | (585) 223-9080 |   |
|---------------------------------------|----------------|--------|
| (Registrant’s telephone number) |

|                                                          | N/A |   |
|---------------------------------------------------------------|-----|--------|
| (Former name or former address, if changed since last report) |

|                                                                                                    | Large accelerated filer | o      | Accelerated filer         | o |
|---------------------------------------------------------------------------------------------------------|-------------------------|--------|---------------------------|---|
|                                                                                                    | Non-accelerated filer   | o      | Smaller reporting company | x |
|           (Do not check if smaller reporting company) |                    |   |

----

|     |                                                                                                        |   | Page   |
|----------|-------------------------------------------------------------------------------------------------------------|--------|--------|
|     |                                                                                                        |   |   |   |
|     | Part I. Financial Information                                                                               |   |   |   |
|     |                                                                                                        |   |   |   |
| Item 1.  | Consolidated Financial Statements (unaudited)                                                               |   |   |   |
|     |                                                                                                        |   |   |   |
|     | Consolidated Balance Sheets as of September 30, 2010 and December 31, 2009                                  |   |   | 1  |
|     |                                                                                                        |   |   |   |
|     | Consolidated Statements of Income for the Three Months Ended September 30, 2010 and 2009                    |   |   | 2 |
|     |                                                                                                        |   |   |   |
|     | Consolidated Statements of Income for the Nine Months Ended September 30, 2010 and 2009                     |   |   | 3 |
|     |                                                                                                        |   |   |   |
|     | Consolidated Statements of Stockholders’ Equity for the Nine Months Ended September 30, 2010 and 2009 |   |   | 4 |
|     |                                                                                                        |   |   |   |
|     | Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2010 and 2009                 |   |   | 5 |
|     |                                                                                                        |   |   |   |
|     | Notes to Consolidated Financial Statements                                                                  |   |   | 7 |
|     |                                                                                                        |   |   |   |
| Item 2.  | Management’s Discussion and Analysis of Financial Condition and Results of Operations                 |   |   | 17 |
|     |                                                                                                        |   |   |   |
| Item 3.  | Quantitative and Qualitative Disclosures about Market Risk                                                  |   |   | 29 |
|     |                                                                                                        |   |   |   |
| Item 4T. | Controls and Procedures                                                                                     |   |   | 29 |
|     |                                                                                                        |   |   |   |
|     | Part II. Other Information                                                                                  |   |   |   |
|     |                                                                                                        |   |   |   |
| Item 1.  | Legal Proceedings                                                                                           |   |   | 30 |
|     |                                                                                                        |   |   |   |
| Item 1A. | Risk Factors                                                                                                |   |   | 30 |
|     |                                                                                                        |   |   |   |
| Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds                                                 |   |   | 30 |
|     |                                                                                                        |   |   |   |
| Item 3.  | Defaults upon Senior Securities                                                                             |   |   | 30 |
|     |                                                                                                        |   |   |   |
| Item 4.  | [Removed and Reserved]                                                                                      |   |   | 30 |
|     |                                                                                                        |   |   |   |
| Item 5.  | Other Information                                                                                           |   |   | 30 |
|     |                                                                                                        |   |   |   |
| Item 6.  | Exhibits                                                                                                    |   |   | 30 |
|     |                                                                                                        |   |   |   |
|     | Signature Page                                                                                              |   |   | 32 |

----

|                                                                                                                                                                                                               |   | September 30, 2010 |    |   | December 31,2009 |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------|---------|--------|------------------|--------|
| Assets                                                                                                                                                                                                             |   |                    |    |   |             |   |
| Cash and due from banks                                                                                                                                                                                            |   | $                       | 9,525   |   |             | $      | 3,385 |   |
| Interest-earning demand deposits                                                                                                                                                                                   |   |                    | 1,105   |   |             |   | 2,580 |   |
|      Cash and Cash Equivalents                                                                                                                                                            |   |                    | 10,630  |   |             |   | 5,965 |   |
|                                                                                                                                                                                                               |   |                    |    |   |             |   |   |   |
| Securities available for sale                                                                                                                                                                                      |   |                    | 75,139  |   |             |   | 75,483 |   |
| Securities held to maturity (fair value 2010 $5,687; 2009 $6,183)                                                                                                                                                  |   |                    | 5,523   |   |             |   | 6,098 |   |
| Investment in FHLB stock                                                                                                                                                                                           |   |                    | 1,608   |   |             |   | 1,886 |   |
| Loans held for sale                                                                                                                                                                                                |   |                    | 695     |   |             |   | - |   |
| Loans receivable, net of allowance for loan losses (2010 $381; 2009  $368)                                                                                                                               |   |                    | 113,948 |   |             |   | 116,372 |   |
| Bank owned life insurance                                                                                                                                                                                          |   |                    | 3,112   |   |             |   | 3,013 |   |
| Accrued interest receivable                                                                                                                                                                                        |   |                    | 1,009   |   |             |   | 1,156 |   |
| Premises and equipment, net                                                                                                                                                                                        |   |                    | 2,534   |   |             |   | 2,556 |   |
| Foreclosed real estate                                                                                                                                                                                             |   |                    | -       |   |             |   | 79 |   |
| Prepaid FDIC premium                                                                                                                                                                                               |   |                    | 631     |   |             |   | 793 |   |
| Other assets                                                                                                                                                                                                       |   |                    | 728     |   |             |   | 999 |   |
|                                  Total Assets |   | $                       | 215,557 |   |             | $      | 214,400 |   |
|                                                                                                                                                                                                               |   |                    |    |   |             |   |   |   |
| Liabilities & Stockholders’ Equity                                                                                                                                                                       |   |                    |    |   |             |   |   |   |
|                                                                                                                                                                                                               |   |                    |    |   |             |   |   |   |
| Deposits:                                                                                                                                                                                                          |   |                    |    |   |             |   |   |   |
|      Non-interest-bearing                                                                                                                                                                 |   | $                       | 3,872   |   |             | $      | 3,955 |   |
|      Interest-bearing                                                                                                                                                                     |   |                    | 158,477 |   |             |   | 152,555 |   |
|                 Total Deposits                                                                                                     |   |                    | 162,349 |   |             |   | 156,510 |   |
|                                                                                                                                                                                                               |   |                    |    |   |             |   |   |   |
| Borrowings                                                                                                                                                                                                         |   |                    | 28,800  |   |             |   | 34,590 |   |
| Advances from borrowers for taxes and insurance                                                                                                                                                                    |   |                    | 906     |   |             |   | 2,012 |   |
| Official bank checks                                                                                                                                                                                               |   |                    | 1,881   |   |             |   | 432 |   |
| Other liabilities                                                                                                                                                                                                  |   |                    | 724     |   |             |   | 506 |   |
|                             Total Liabilities                          |   |                    | 194,660 |   |             |   | 194,050 |   |
|                                                                                                                                                                                                               |   |                    |    |   |             |   |   |   |
| Stockholders’ Equity                                                                                                                                                                                         |   |                    |    |   |             |   |   |   |
|                                                                                                                                                                                                               |   |                    |    |   |             |   |   |   |
| Preferred Stock- no par value- 1,000,000 shares authorized;                                                                                                                                                        |   |                    |    |   |             |   |   |   |
|   no shares issued and outstanding                                                                                                                                                                       |   |                    | -       |   |             |   | - |   |
| Common Stock- $0.10 par value – 10,000,000 shares authorized;                                                                                                                                                |   |                    |    |   |             |   |   |   |
|   1,785,000 shares issued and outstanding                                                                                                                                                                |   |                    | 179     |   |             |   | 179 |   |
| Additional paid-in-capital                                                                                                                                                                                         |   |                    | 7,271   |   |             |   | 7,275 |   |
| Retained earnings                                                                                                                                                                                                  |   |                    | 13,477  |   |             |   | 13,317 |   |
| Accumulated other comprehensive income                                                                                                                                                                             |   |                    | 538     |   |             |   | 174 |   |
| Unearned ESOP shares – at cost                                                                                                                                                                               |   |                    | (568    | )      |             |   | (595 | ) |
|                         Total Stockholders’ Equity                                   |   |                    | 20,897  |   |             |   | 20,350 |   |
|                                                                                                                                                                                                               |   |                    |    |   |             |   |   |   |
|                         Total Liabilities and Stockholders’ Equity                   |   | $                       | 215,557 |   |             | $      | 214,400 |   |
|                                                                                                                                                                                                               |   |                    |    |   |             |   |   |   |
| See accompanying notes to consolidated financial statements                                                                                                                                                        |   |                    |    |   |             |   |   |   |

----

|                                                                                                                                     |   |   |   |
|------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|
|                                                                                                                                     |   | 2010   |   |   | 2009 |   |
|                                                                                                                                     |   |   |   |   |   |   |
| Interest and Dividend Income                                                                                                             |   |   |   |   |   |   |
|     Loans                                                                                                            |   | $      | 1,614  |   |   | $ | 1,669 |   |
|     Securities – taxable                                                                                       |   |   | 285    |   |   |   | 415 |   |
|     Securities – tax exempt                                                                                    |   |   | 3      |   |   |   | - |   |
|     Mortgage-backed securities                                                                                       |   |   | 218    |   |   |   | 264 |   |
|     Other                                                                                                            |   |   | 7      |   |   |   | 2 |   |
|                  Total Interest and Dividend Income |   |   | 2,127  |   |   |   | 2,350 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
| Interest expense                                                                                                                         |   |   |   |   |   |   |   |   |
|     Deposits                                                                                                         |   |   | 590    |   |   |   | 844 |   |
| Borrowings                                                                                                                               |   |   | 293    |   |   |   | 404 |   |
|                 Total Interest Expense                   |   |   | 883    |   |   |   | 1,248 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                 Net Interest Income                      |   |   | 1,244  |   |   |   | 1,102 |   |
| Provision for Loan Losses                                                                                                                |   |   | 8      |   |   |   | 7 |   |
|                 Net Interest Income After Provision      |   |   |   |   |   |   |   |   |
|                    for Loan Losses        |   |   | 1,236  |   |   |   | 1,095 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
| Other Income                                                                                                                             |   |   |   |   |   |   |   |   |
| Service fees                                                                                                                             |   |   | 56     |   |   |   | 73 |   |
| Fee income                                                                                                                               |   |   | 10     |   |   |   | 5 |   |
| Realized gain on sale of securities                                                                                                      |   |   | 95     |   |   |   | - |   |
| Increase in cash surrender value of bank owned life insurance                                                                            |   |   | 34     |   |   |   | - |   |
| Realized gain on sale of loans                                                                                                           |   |   | 155    |   |   |   | 4 |   |
| Other                                                                                                                                    |   |   | 92     |   |   |   | 51 |   |
|                Total Other Income                             |   |   | 442    |   |   |   | 133 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
| Other Expense                                                                                                                            |   |   |   |   |   |   |   |   |
| Salaries and employee benefits                                                                                                           |   |   | 894    |   |   |   | 613 |   |
| Occupancy expense                                                                                                                        |   |   | 151    |   |   |   | 130 |   |
| Data processing costs                                                                                                                    |   |   | 27     |   |   |   | 25 |   |
| Advertising                                                                                                                              |   |   | 39     |   |   |   | 76 |   |
| Equipment expense                                                                                                                        |   |   | 107    |   |   |   | 92 |   |
| Electronic banking                                                                                                                       |   |   | 22     |   |   |   | 21 |   |
| Directors’ fees                                                                                                                    |   |   | 30     |   |   |   | 25 |   |
| Mortgage fees and taxes                                                                                                                  |   |   | 61     |   |   |   | 71 |   |
| FDIC premium expense                                                                                                                     |   |   | 58     |   |   |   | 80 |   |
| Other expense                                                                                                                            |   |   | 168    |   |   |   | 152 |   |
|                Total Other Expenses                           |   |   | 1,557  |   |   |   | 1,285 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                Income (Loss ) Before Income Taxes             |   |   | 121    |   |   |   | (57 | ) |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                Provision (Benefit) for Income Taxes           |   |   | 29     |   |   |   |  (23 | ) |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                Net Income (Loss)                              |   | $      | 92     |   |   | $ | (34 | ) |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                Earnings (Loss) per common share                    |   | $      | 0.05   |   |   | $ | (0.02 | ) |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
| See accompanying notes to consolidated financial statements                                                                              |   |   |   |   |   |   |   |   |

----

|                                                                                                                                     |   | 2010   |   |   | 2009   |   |
|------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
|                                                                                                                                     |   |   |   |   |   |   |
| Interest and Dividend Income                                                                                                             |   |   |   |   |   |   |
|     Loans                                                                                                            |   | $      | 4,809  |   |   | $      | 5,333 |   |
|     Securities – taxable                                                                                       |   |   | 1,124  |   |   |   | 983 |   |
|     Securities – tax exempt                                                                                    |   |   | 3      |   |   |   | - |   |
|     Mortgage-backed securities                                                                                       |   |   | 634    |   |   |   | 889 |   |
|     Other                                                                                                            |   |   | 12     |   |   |   | 5 |   |
|                  Total Interest and Dividend Income |   |   | 6,582  |   |   |   | 7,210 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
| Interest expense                                                                                                                         |   |   |   |   |   |   |   |   |
|     Deposits                                                                                                         |   |   | 1,978  |   |   |   | 2,586 |   |
|     Borrowings:                                                                                                      |   |   |   |   |   |   |   |   |
| Short-term                                                                                                                               |   |   | -      |   |   |   | 1 |   |
| Long-term                                                                                                                                |   |   | 973    |   |   |   | 1,234 |   |
|                 Total Interest Expense                   |   |   | 2,951  |   |   |   | 3,821 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                 Net Interest Income                      |   |   | 3,631  |   |   |   | 3,389 |   |
| Provision for Loan Losses                                                                                                                |   |   | 14     |   |   |   | 21 |   |
| Net Interest Income After Provision for Loan Losses                                                                                      |   |   | 3,617  |   |   |   | 3,368 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
| Other Income                                                                                                                             |   |   |   |   |   |   |   |   |
| Service fees                                                                                                                             |   |   | 173    |   |   |   | 188 |   |
| Fee income                                                                                                                               |   |   | 36     |   |   |   | 33 |   |
| Realized gain on sale of securities                                                                                                      |   |   | 87     |   |   |   | 92 |   |
| Realized loss on sale of foreclosed real estate                                                                                          |   |   | (5     | )      |   |   | - |   |
| Increase in cash surrender value of bank owned life insurance                                                                            |   |   | 99     |   |   |   | - |   |
| Realized gain on sale of  loans                                                                                                |   |   | 238    |   |   |   | 49 |   |
| Other                                                                                                                                    |   |   | 235    |   |   |   | 154 |   |
|                Total Other Income                             |   |   | 863    |   |   |   | 516 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
| Other Expense                                                                                                                            |   |   |   |   |   |   |   |   |
| Salaries and employee benefits                                                                                                           |   |   | 2,308  |   |   |   | 1,862 |   |
| Occupancy expense                                                                                                                        |   |   | 450    |   |   |   | 379 |   |
| Data processing costs                                                                                                                    |   |   | 70     |   |   |   | 72 |   |
| Advertising                                                                                                                              |   |   | 133    |   |   |   | 160 |   |
| Equipment expense                                                                                                                        |   |   | 314    |   |   |   | 269 |   |
| Electronic banking                                                                                                                       |   |   | 59     |   |   |   | 60 |   |
| Directors’ fees                                                                                                                    |   |   | 85     |   |   |   | 82 |   |
| Mortgage fees and taxes                                                                                                                  |   |   | 178    |   |   |   | 187 |   |
| FDIC premium expense                                                                                                                     |   |   | 174    |   |   |   | 261 |   |
| Other expense                                                                                                                            |   |   | 523    |   |   |   | 490 |   |
|                Total Other Expenses                           |   |   | 4,294  |   |   |   | 3,822 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                IncomeBefore Income Taxes                      |   |   | 186    |   |   |   | 62 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                Provision for Income Taxes                     |   |   | 26     |   |   |   | 18 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                Net Income                                     |   | $      | 160    |   |   | $      | 44 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
|                Earnings per common share                           |   | $      | 0.09   |   |   | $      | 0.03 |   |
|                                                                                                                                     |   |   |   |   |   |   |   |   |
| See accompanying notes to consolidated financial statements                                                                              |   |   |   |   |   |   |   |   |

----

|                                                                                                                    |   | Common Stock |    |   | AdditionalPaid in Capital |   |    | RetainedEarnings |   |   | AccumulatedOtherComprehensiveIncome (Loss) |   |   | UnearnedESOPShares |      |   | Total  |   |
|-------------------------------------------------------------------------------------------------------------------------|--------|--------------|---------|--------|---------------------------|--------|---------|------------------|--------|--------|--------------------------------------------|--------|--------|--------------------|-----------|--------|--------|--------|
| Balance – January 1, 2009                                                                                         |   | $            | 179     |   |                      | $      | 7,286   |             |   | $      | 13,249                                     |   |   | $                  | (43       | )      |   | $      | (630 | ) |   | $ | 20,041 |   |
|                                                                                                                    |   |         |    |   |                      |   |    |             |   |   |                                       |   |   |               |      |   |   |   |   |   |   |   |   |   |
|    Comprehensive income:                                                                                 |   |         |    |   |                      |   |    |             |   |   |                                       |   |   |               |      |   |   |   |   |   |   |   |   |   |
|         Net income                                                              |   |         | -       |   |                      |   | -       |             |   |   | 44                                         |   |   |               | -         |   |   |   | - |   |   |   | 44 |   |
| Change in net unrealized gain on securities available for sale, net of reclassification adjustment and taxes            |   |         |  - |   |                      |   |  - |             |   |   |  -                                    |   |   |               |  373 |   |   |   |  - |   |   |   |  373 |   |
| Total Comprehensive Income                                                                                              |   |         |    |   |                      |   |    |             |   |   |                                       |   |   |               |      |   |   |   |   |   |   |   | 417 |   |
|    ESOP shares committed to be                                                                           |   |         |    |   |                      |   |    |             |   |   |                                       |   |   |               |      |   |   |   |   |   |   |   |   |   |
|              released                                  |   |         | -       |   |                      |   | (10     | )                |   |   | -                                          |   |   |               | -         |   |   |   | 26 |   |   |   | 16 |   |
| Balance – September 30, 2009                                                                                      |   | $            | 179     |   |                      | $      | 7,276   |             |   | $      | 13,293                                     |   |   | $                  | 330       |   |   | $      | (604 | ) |   | $ | 20,474 |   |
|                                                                                                                    |   |         |    |   |                      |   |    |             |   |   |                                       |   |   |               |      |   |   |   |   |   |   |   |   |   |
| Balance – January 1, 2010                                                                                         |   | $            | 179     |   |                      | $      | 7,275   |             |   | $      | 13,317                                     |   |   | $                  | 174       |   |   | $      | (595 | ) |   | $ | 20,350 |   |
|                                                                                                                    |   |         |    |   |                      |   |    |             |   |   |                                       |   |   |               |      |   |   |   |   |   |   |   |   |   |
|    Comprehensive income:                                                                                 |   |         |    |   |                      |   |    |             |   |   |                                       |   |   |               |      |   |   |   |   |   |   |   |   |   |
|         Net income                                                              |   |         | -       |   |                      |   | -       |             |   |   | 160                                        |   |   |               | -         |   |   |   | - |   |   |   | 160 |   |
| Change in net unrealized  gain on securities available for sale, net of reclassification adjustment and taxes |   |         | -       |   |                      |   | -       |             |   |   | -                                          |   |   |               |  364 |   |   |   |  - |   |   |   |  364 |   |
| Total Comprehensive Income                                                                                              |   |         |    |   |                      |   |    |             |   |   |                                       |   |   |               |      |   |   |   |   |   |   |   | 524 |   |
|                                                                                                                    |   |         |    |   |                      |   |    |             |   |   |                                       |   |   |               |      |   |   |   |   |   |   |   |   |   |
| ESOP shares committed to be released                                                                                    |   |         | -       |   |                      |   | (4      | )                |   |   | -                                          |   |   |               | -         |   |   |   | 27 |   |   |   | 23 |   |
| Balance – September 30, 2010                                                                                      |   | $            | 179     |   |                      | $      | 7,271   |             |   | $      | 13,477                                     |   |   | $                  | 538       |   |   | $      | (568 | ) |   | $ | 20,897 |   |

----

|                                                                                                                                                                                                                 |   |   |    |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|---------|
|                                                                                                                                                                                                                 |   | 2010   |    |   | 2009 |   |
| Cash Flows From Operating Activities                                                                                                                                                                                 |   |   |    |   |   |   |
| Net income                                                                                                                                                                                                           |   | $      | 160     |   |   | $ | 44 |   |
| Adjustments to reconcile net income to net cash used by operating activities:                                                                                                                                        |   |   |    |   |   |   |   |   |
| Net amortization of premiums and discounts on investments                                                                                                                                                            |   |   | 743     |   |   |   | 479 |   |
|        Gain on sale of securities available for sale                                                                                                                              |   |   | (97     | ) |   |   | (92 | ) |
|        Loss on sale of securities held to maturity                                                                                                                                |   |   | 10      |   |   |   | - |   |
|        Gain on sale of loans                                                                                                                                                      |   |   | (238    | ) |   |   | (49 | ) |
|        Proceeds from loans sold                                                                                                                                                   |   |   | 7,377   |   |   |   | 12,709 |   |
|        Loans originated for sale                                                                                                                                                  |   |   | (7,834  | ) |   |   | (12,660 | ) |
|        Amortization of net deferred loan origination costs                                                                                                                        |   |   | 23      |   |   |   | 11 |   |
|        Depreciation and amortization                                                                                                                                              |   |   | 238     |   |   |   | 221 |   |
|        Provision for loan losses                                                                                                                                                  |   |   | 14      |   |   |   | 21 |   |
|        Expense related to ESOP                                                                                                                                                    |   |   | 23      |   |   |   | 16 |   |
|        Deferred income tax expense (benefit)                                                                                                                                      |   |   | 1       |   |   |   | (43 | ) |
|        Earnings on investment in bank owned life insurance                                                                                                                        |   |   | (99     | ) |   |   | - |   |
|        Decrease (increase) in accrued interest receivable                                                                                                                         |   |   | 147     |   |   |   | (321 | ) |
|        Decrease (increase) in prepaid FDIC premium and other assets                                                                                                               |   |   | 433     |   |   |   | (272 | ) |
|        Increase (decrease) in other liabilities                                                                                                                                   |   |   | 29      |   |   |   | (103 | ) |
|        Loss on sale of foreclosed real estate                                                                                                                                     |   |   | 5       |   |   |   | - |   |
|                         Net Cash Provided By/(Used By) Operating Activities                  |   |   | 935     |   |   |   | (39 | ) |
|                                                                                                                                                                                                                 |   |   |    |   |   |   |   |   |
| Cash Flows From Investing Activities                                                                                                                                                                                 |   |   |    |   |   |   |   |   |
| Purchases of securities available for sale                                                                                                                                                                           |   |   | (80,230 | ) |   |   | (79,566 | ) |
| Proceeds from maturities and calls of securities available for sale                                                                                                                                                  |   |   | 71,800  |   |   |   | 33,037 |   |
| Proceeds from sales of securities available for sale                                                                                                                                                                 |   |   | 3,188   |   |   |   | 5,355 |   |
| Proceeds from principal paydowns on securities available for sale                                                                                                                                                    |   |   | 5,494   |   |   |   | 3,602 |   |
| Purchases of securities held to maturity                                                                                                                                                                             |   |   | (510    | ) |   |   | - |   |
| Proceeds from principal paydowns on securities held to maturity                                                                                                                                                      |   |   | 387     |   |   |   | 850 |   |
| Proceeds from maturities and calls of securities held to maturity                                                                                                                                                    |   |   | -       |   |   |   | - |   |
| Proceeds from sales of securities held to maturity                                                                                                                                                                   |   |   | 686     |   |   |   | - |   |
| Net decrease in loans                                                                                                                                                                                                |   |   | 2,387   |   |   |   | 18,718 |   |
| Redemption of FHLB stock                                                                                                                                                                                             |   |   | 278     |   |   |   | 310 |   |
| Proceeds from sales of foreclosed real estate                                                                                                                                                                        |   |   | 74      |   |   |   | - |   |
| Purchase of premises and equipment                                                                                                                                                                                   |   |   | (216    | ) |   |   | (495 | ) |
|                         Net Cash Provided By/(Used By) Investing Activities                  |   |   | 3,338   |   |   |   | (18,189 | ) |
|                                                                                                                                                                                                                 |   |   |    |   |   |   |   |   |
| Cash Flows From Financing Activities                                                                                                                                                                                 |   |   |    |   |   |   |   |   |
| Net increase in deposits                                                                                                                                                                                             |   |   | 5,839   |   |   |   | 32,625 |   |
| Net decrease in short-term borrowings                                                                                                                                                                                |   |   | -       |   |   |   | (3,850 | ) |
| Repayments on long-term borrowings                                                                                                                                                                                   |   |   | (5,790  | ) |   |   | (4,459 | ) |
| Net decrease in advances from borrowers for taxes and insurance                                                                                                                                                      |   |   | (1,106  | ) |   |   | (1,210 | ) |
| Net increase in official bank checks                                                                                                                                                                                 |   |   | 1,449   |   |   |   | 1,992 |   |
|                         Net Cash Provided By Financing Activities                            |   |   | 392     |   |   |   | 25,098 |   |
|                                                                                                                                                                                                                 |   |   |    |   |   |   |   |   |
|                         Net Increase in Cash                                                 |   |   |    |   |   |   |   |   |
|                                 and Cash Equivalents |   |   | 4,665   |   |   |   | 6,870 |   |
|                                                                                                                                                                                                                 |   |   |    |   |   |   |   |   |
| Cash and Cash Equivalents- Beginning                                                                                                                                                                                 |   |   | 5,965   |   |   |   | 3,173 |   |
|                                                                                                                                                                                                                 |   |   |    |   |   |   |   |   |
| Cash and Cash Equivalents- Ending                                                                                                                                                                                    |   | $      | 10,630  |   |   | $ | 10,043 |   |

----

|                                                              |   |   |   |
|-------------------------------------------------------------------|--------|--------|--------|
|                                                              |   | 2010   |   |   | 2009 |   |
| Supplementary Cash Flows Information                              |   |   |   |   |   |   |
|                                                              |   |   |   |   |   |   |
|         Interest paid     |   | $      | 3,002  |   |   | $ | 3,836 |   |
|                                                              |   |   |   |   |   |   |   |   |
|         Income taxes paid |   | $      | -      |   |   | $ | 115 |   |
|                                                              |   |   |   |   |   |   |   |   |
| See accompanying notes to consolidated financial statements       |   |   |   |   |   |   |   |   |

----

----

| September 30, 2010Securities Available for Sale:(In Thousands) |   | Total  |   |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
|----------------------------------------------------------------|--------|--------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|
|                                                           |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |
| U.S. Government agency securities                              |   | $      | 43,898 |   |    | $      | 5,000  |    |   | $      | 38,898  |   |   | $ | - |   |
|                                                           |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |
| Mortgage-backed securities - residential                  |   |   | 27,254 |   |    |   | 2,079  |    |   |   | 25,175  |   |   |   | - |   |
|                                                           |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |
| SBA pools                                                      |   |   | 3,987  |   |    |   | -      |    |   |   | 3,987   |   |   |   | - |   |
|                                                           |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |
| Total Available for Sale Securities                            |   | $      | 75,139 |   |    | $      | 7,079  |    |   | $      | 68,060  |   |   | $ | - |   |
|  (In Thousands)                                      |   |
| December 31, 2009Securities Available for Sale:(In Thousands)  |   | Total  |   |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
|                                                           |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |
| Equity securities                                              |   | $      | 12     |   |    | $      | 12     |    |   | $      | -       |   |   | $ | - |   |
|                                                           |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |
| U.S. Government agency securities                              |   |   | 54,629 |   |    |   | 5,548  |    |   |   | 49,081  |   |   |   | - |   |
|                                                           |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |
| Mortgage-backed securities - residential                       |   |   | 20,842 |   |    |   | -      |    |   |   | 20,842  |   |   |   | - |   |
|                                                           |   |   |   |   |    |   |   |    |   |   |    |   |   |   |   |   |
| Total Available for Sale Securities                            |   | $      | 75,483 |   |    | $      | 5,560  |    |   | $      | 69,923  |   |   | $ | - |   |

----

| Note 2--Fair Value Measurement and Disclosure (Continued) |
|-----------------------------------------------------------|

----

| Accrued Interest Receivable and Payable |
|-----------------------------------------|

|                             |   | September 30, 2010 |    |   | December 31, 2009 |   |
|----------------------------------|--------|--------------------|---------|--------|-------------------|--------|
|                             |   | CarryingAmount     |    |   | FairValue         |   |   | CarryingAmount |   |   | FairValue |   |
|                             |   | (In Thousands)     |    |
| Financial assets:                |   |               |    |   |              |   |   |   |   |   |   |   |
| Cash and due from banks          |   | $                  | 9,525   |   |              | $      | 9,525 |   |   | $ | 3,385 |   |   | $ | 3,385 |   |
| Interest bearing demand deposits |   |               | 1,105   |   |              |   | 1,105 |   |   |   | 2,580 |   |   |   | 2,580 |   |
| Securities available for sale    |   |               | 75,139  |   |              |   | 75,139 |   |   |   | 75,483 |   |   |   | 75,483 |   |
| Securities held to maturity      |   |               | 5,523   |   |              |   | 5,687 |   |   |   | 6,098 |   |   |   | 6,183 |   |
| FHLB stock                       |   |               | 1,608   |   |              |   | 1,608 |   |   |   | 1,886 |   |   |   | 1,886 |   |
| Loans held for sale              |   |               | 695     |   |              |   | 695 |   |   |   | - |   |   |   | - |   |
| Loans, net                       |   |               | 113,948 |   |              |   | 119,854 |   |   |   | 116,372 |   |   |   | 118,883 |   |
| Accrued interest receivable      |   |               | 1,009   |   |              |   | 1,009 |   |   |   | 1,156 |   |   |   | 1,156 |   |
|                             |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Financial liabilities:           |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                         |   |               | 162,349 |   |              |   | 161,325 |   |   |   | 156,510 |   |   |   | 155,606 |   |
| Borrowings                       |   |               | 28,800  |   |              |   | 26,929 |   |   |   | 34,590 |   |   |   | 32,579 |   |
| Accrued interest payable         |   |               | 78      |   |              |   | 78 |   |   |   | 129 |   |   |   | 129 |   |
|                             |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Off-balance sheet instruments:   |   |               |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Commitments to extend credit     |   |               | -       |   |              |   | - |   |   |   | - |   |   |   | - |   |

----

|                                                                                                             |   | AmortizedCost  |   |   | GrossUnrealizedGains |   |      | GrossUnrealizedLosses |   |   | FairValue |   |
|------------------------------------------------------------------------------------------------------------------|--------|----------------|--------|--------|----------------------|--------|-----------|-----------------------|--------|--------|-----------|--------|
|                                                                                                             |   | (In Thousands) |   |
| September 30, 2010:                                                                                              |   |           |   |   |                 |   |      |                  |   |   |      |   |
| Available for Sale:                                                                                              |   |           |   |   |                 |   |      |                  |   |   |      |   |
|             U.S. Government agency securities        |   | $              | 43,651 |   |                 | $      | 249       |                  |   | $      | (2        | )      |   | $ | 43,898 |   |
|             Mortgage-backed securities - residential |   |           | 26,735 |   |                 |   | 525       |                  |   |   | (6        | )      |   |   | 27,254 |   |
| SBA pools                                                                                                        |   |           | 3,937  |   |                 |   | 50        |                  |   |   | -         |   |   |   | 3,987 |   |
|                                                                                                             |   |           |   |   |                 |   |      |                  |   |   |      |   |   |   |   |   |
|                                                                                                             |   | $              | 74,323 |   |                 | $      |  824 |                  |   | $      | (8        | )      |   | $ | 75,139 |   |

| Held to Maturity:                                   |   |   |   |   |   |   |   |   |   |   |   |   |
|-----------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Mortgage-backed securities – residential |   | $      | 5,013  |   |   | $      | 152    |   |   | $      | -      |   |   | $ | 5,165 |   |
| State and Municipal securities                      |   |   | 510    |   |   |   | 12     |   |   |   | -      |   |   |   | 522 |   |
|                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                |   |   | 5,523  |   |   |   | 164    |   |   |   | -      |   |   |   | 5,687 |   |

| December 31, 2009:                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
|-----------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Available for Sale:                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
|      Equity securities                                                                             |   | $      | 9      |   |   | $      | 3      |   |   | $      | -      |   |   | $ | 12 |   |
|             U.S. Government agency securities                   |   |   | 54,842 |   |   |   | 100    |   |   |   | (313   | )      |   |   | 54,629 |   |
|             Mortgage-backed securities – residential |   |   | 20,369 |   |   |   | 473    |   |   |   | -      |   |   |   | 20,842 |   |

|                                                                              |   | $      | 75,220 |   |   | $      | 576    |   |   | $      | (313   | )      |   | $      | 75,483 |   |
|-----------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Held to Maturity:                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      Mortgage-backed securities – residential |   | $      | 6,098  |   |   | $      | 86     |   |   | $      | (1     | )      |   | $      | 6,183  |   |

----

|                                           |   | Available for Sale   |         |   | Held to Maturity     |   |
|------------------------------------------------|--------|----------------------|--------------|--------|----------------------|--------|
|                                           |   | AmortizedCost        |         |   | EstimatedFair Value  |   |   | AmortizedCost |   |   | EstimatedFair Value |   |
|                                           |   |  (In Thousands) |         |   |  (In Thousands) |   |
|                                           |   |                 |         |   |                 |   |
| Due in one year or less                        |   | $                    | -            |   |                 | $      | - |   |   | $ | - |   |   | $ | - |   |
| Due after one year through five years          |   |                 | 7,320        |   |                 |   | 7,348 |   |   |   | - |   |   |   | - |   |
| Due after five years through ten years         |   |                 | 20,576       |   |                 |   | 20,704 |   |   |   | 510 |   |   |   | 522 |   |
| Due after ten years                            |   |                 | 15,755       |   |                 |   | 15,846 |   |   |   | - |   |   |   | - |   |
| Mortgage-backed securities – residential |   |                 | 26,735       |   |                 |   | 27,254 |   |   |   | 5,013 |   |   |   | 5,165 |   |
| SBA pools                                      |   |                 | 3,937        |   |                 |   | 3,987 |   |   |   | - |   |   |   | - |   |
|                                           |   |                 |         |   |                 |   |   |   |   |   |   |   |   |   |   |   |
|                                           |   | $                    | 74,323  |   |                 | $      | 75,139  |   |   | $ |   5,523  |   |   | $ | 5,687  |   |

----

|                                            |   | Less than 12 Months |              |    12 Months or More |                   |    Total |    |
|-------------------------------------------------|--------|---------------------|-------------------|--------------------------------|------------------------|--------------------|---------|
|                                            |   | FairValue           |              |                           | GrossUnrealized Losses |               |    | FairValue |   |   | GrossUnrealizedLosses |   |   | FairValue |   |   | GrossUnrealized Losses |   |
|                                            |   | (In Thousands)      |              |
| September 30, 2010:                             |   |                |              |                           |                   |               |    |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Government agency securities               |   | $                   | 5,027             |                           |                   | $                  | 2       |   |   | $ | - |   |   | $ | - |   |   | $ | 5,027 |   |   | $ | 2 |   |
| Mortgaged-backed securities – residential |   |                | 1,487             |                           |                   |               | 6       |   |   |   | - |   |   |   | - |   |   |   | 1,487 |   |   |   | 6 |   |
|                                            |   |                |              |                           |                   |               |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                            |   | $                   |  6,514  |                           |                   | $                  | 8  |   |   | $ |  -  |   |   | $ |  -  |   |   | $ |    6,514  |   |   | $ | 8  |   |

| December 31, 2009:                              |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |
|-------------------------------------------------|--------|--------|--------|--------|--------|--------|-----------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| U.S. Government agency securities               |   | $      | 27,241 |   |   | $      | 313       |   |   | $      | -      |   |   | $      | -      |   |   | $      | 27,241 |   |   | $ | 313 |   |
| Mortgaged-backed securities – residential |   |   | 442    |   |   |   | 1         |   |   |   | 18     |   |   |   | -      |   |   |   | 460 |   |   |   | 1 |   |
|                                            |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                            |   | $      | 27,683 |   |   | $      |  314 |   |   | $      | 18     |   |   | $      | -      |   |   | $      | 27,701 |   |   | $ | 314 |   |

----

----

|                                                                            |   |                                                      |   |   |                                         |   |      |   |   |   |   |   |   |   |   |   |
|---------------------------------------------------------------------------------|--------|-----------------------------------------------------------|--------|--------|----------------------------------------------|--------|-----------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                                            |   |  For the Three Months  Ended September 30, |   |   | For the Nine months Ended September 30, |   |
|                                                                            |   | 2010                                                      |   |   | 2009                                         |   |      | 2010   |   |   | 2009   |   |
|                                                                            |   |  (In Thousands)                       |   |   |    (In Thousands)        |   |
|                                                                            |   |                                                      |   |   |                                         |   |      |   |   |   |   |   |   |   |   |   |
|  Unrealized holding gain on available for sale securities                  |   | $                                                         | 118    |   |                                         | $      | 768       |   |   | $      | 649    |   |   | $      | 613    |   |
| Reclassification adjustment for realized  gain included in net income |   |                                                      | (95    | )      |                                         |   | -         |   |   |   | (97    | )      |   |   | (92    | )      |
|                                                                            |   |                                                      |   |   |                                         |   |      |   |   |   |   |   |   |   |   |   |
| Net Unrealized Gain                                                             |   |                                                      | 23     |   |                                         |   | 768       |   |   |   | 552    |   |   |   | 521    |   |
|                                                                            |   |                                                      |   |   |                                         |   |      |   |   |   |   |   |   |   |   |   |
| Tax effect                                                                      |   |                                                      | 9      |   |                                         |   |  232 |   |   |   | 188    |   |   |   | 148    |   |
|                                                                            |   |                                                      |   |   |                                         |   |      |   |   |   |   |   |   |   |   |   |
| Net of tax amount                                                               |   | $                                                         | 14     |   |                                         | $      | 536       |   |   | $      | 364    |   |   | $      | 373    |   |

|   | ● | A reporting entity to disclose separately the amounts of significant transfers in and out of Level 1 and Level 2 fair value measurements and describe the reasons for the transfers; and |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | In the reconciliation for fair value measurements using significant unobservable inputs, a reporting entity should present separately information about purchases, sales, issuances, and settlements. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | ● | For purposes of reporting fair value measurement for each class of assets and liabilities, a reporting entity needs to use judgment in determining the appropriate classes of assets and liabilities; and |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | A reporting entity should provide disclosures about the valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements. |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

----

|                                                                                                                                                                                                                                                     |   | For the Three Months Ended September 30, |    |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|---------|
|                                                                                                                                                                                                                                                     |   | 2010                                     |    |   | 2009 |   |
|                                                                                                                                                                                                                                                     |   | Average Balance                          |    |   | Interest Income/Expense |   |   | Yield/Cost |   |   | Average Balance |   |   | Interest Income/Expense |   |   | Yield/Cost |   |
|                                                                                                                                                                                                                                                     |   | (Dollars in thousands)                   |    |
| Interest-earning assets:                                                                                                                                                                                                                                 |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans                                                                                                                                                                                                                                                    |   | $                                        | 117,871 |   |   | $ | 1,614 |   |   |   | 5.48 | % |   | $ | 117,379 |   |   | $ | 1,669 |   |   |   | 5.69 | % |
| Securities - taxable                                            |   |                                     | 49,769  |   |   |   | 285 |   |   |   | 2.29 |   |   |   | 52,972 |   |   |   | 415 |   |   |   | 3.13 |   |
| Mortgage-backed securities                                                                                                                                                                                                                               |   |                                     | 28,493  |   |   |   | 218 |   |   |   | 3.06 |   |   |   | 27,468 |   |   |   | 264 |   |   |   | 3.84 |   |
| State and Municipal securities (1)                                                                                                                                                                                                                       |   |                                     | 433     |   |   |   | 4 |   |   |   | 3.70 |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Other                                                           |   |                                     | 13,088  |   |   |   | 7 |   |   |   | 0.21 |   |   |   | 5,335 |   |   |   | 2 |   |   |   | 0.15 |   |
| Total interest-earning assets                                                                                                                                                                                                                            |   |                                     | 209,654 |   |   |   | 2,128 |   |   |   | 4.06 | % |   |   | 203,154 |   |   |   | 2,350 |   |   |   | 4.63 | % |
| Non-interest-earning assets                                                                                                                                                                                                                              |   |                                     | 8,530   |   |   |   |   |   |   |   |   |   |   |   | 4,625 |   |   |   |   |   |   |   |   |   |
| Total assets                                                                                                                                                                                                                                             |   | $                                        | 218,184 |   |   |   |   |   |   |   |   |   |   | $ | 207,779 |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                     |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities:                                                                                                                                                                                                                            |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NOW accounts                                                    |   | $                                        | 10,301  |   |   | $ | 14 |   |   |   | 0.54 | % |   | $ | 8,627 |   |   | $ | 13 |   |   |   | 0.60 | % |
| Passbook savings                                                |   |                                     | 27,292  |   |   |   | 45 |   |   |   | 0.66 |   |   |   | 15,827 |   |   |   | 26 |   |   |   | 0.66 |   |
| Money market savings Individual retirement accounts                                                                                                                                                                                                 |   |                                     | 27,185  |   |   |   | 57 |   |   |   | 0.84 |   |   |   | 22,787 |   |   |   | 88 |   |   |   | 1.54 |   |
|                                                                                                                                                                                                                                                     |   | 18,172                                   |    |   |   | 121 |   |   |   | 2.66 |   |   |   | 17,857 |   |   |   | 161 |   |   |   | 3.61 |   |
| Certificates of deposit                                         |   |                                     | 76,535  |   |   |   | 353 |   |   |   | 1.84 |   |   |   | 77,475 |   |   |   | 556 |   |   |   | 2.87 |   |
| Borrowings                                                                                                                                                                                                                                               |   |                                     | 29,533  |   |   |   | 293 |   |   |   | 3.97 |   |   |   | 37,426 |   |   |   | 404 |   |   |   | 4.32 |   |
| Total interest-bearing liabilities                                                                                                                                                                                                                       |   |                                     | 189,018 |   |   |   | 883 |   |   |   | 1.87 | % |   |   | 179,999 |   |   |   | 1,248 |   |   |   | 2.77 | % |
| Non-interest-bearing liabilities:                                                                                                                                                                                                                        |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand deposits                                                                                                                                                                                                                                          |   |                                     | 4,166   |   |   |   |   |   |   |   |   |   |   |   | 3,763 |   |   |   |   |   |   |   |   |   |
| Other                                                                                                                                                                                                                                                    |   |                                     | 4,174   |   |   |   |   |   |   |   |   |   |   |   | 3,877 |   |   |   |   |   |   |   |   |   |
| Total liabilities                                                                                                                                                                                                                                        |   |                                     | 197,358 |   |   |   |   |   |   |   |   |   |   |   | 187,639 |   |   |   |   |   |   |   |   |   |
| Stockholders’ equity                                      |   |                                     | 20,826  |   |   |   |   |   |   |   |   |   |   |   | 20,140 |   |   |   |   |   |   |   |   |   |
| Total liabilities and stockholders’ equity                                                                                                                                                                                                         |   | $                                        | 218,184 |   |   |   |   |   |   |   |   |   |   | $ | 207,779 |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                     |   |                                     |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                             |   |                                     |    |   |   | $ | 1,245 |   |   |   |   |   |   |   |   |   |   | $ | 1,102 |   |   |   |   |   |
| Interest rate spread (2)                                        |   |                                     |    |   |   |   |   |   |   |   | 2.19 | % |   |   |   |   |   |   |   |   |   |   | 1.86 | % |
| Net interest-earning assets (3)                                                                                                                                                                                                                          |   | $                                        | 20,636  |   |   |   |   |   |   |   |   |   |   | $ | 23,155 |   |   |   |   |   |   |   |   |   |
| Net interest margin (4)                                         |   |                                     |    |   |   |   | 2.38 | % |   |   |   |   |   |   |   |   |   |   | 2.17 | % |   |   |   |   |
| Average interest-earning assets to average interest-bearing liabilities                                                                                                                                                                                  |   |                                     | 111     | % |   |   |   |   |   |   |   |   |   |   | 113 | % |   |   |   |   |   |   |   |   |

| (1) | Tax-exempt interest income is presented on a tax equivalent basis using a 35 percent federal tax rate. |
|-----|--------------------------------------------------------------------------------------------------------|

| (2) | Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. |
|-----|--------------------------------------------------------------------------------------------------------------|

| (4) | Net interest margin represents net interest income divided by total interest-earning assets. |
|-----|----------------------------------------------------------------------------------------------|

----

|                                                                    |   | For the Nine months Ended September 30, |    |
|-------------------------------------------------------------------------|--------|-----------------------------------------|---------|
|                                                                    |   | 2010                                    |    |   | 2009 |   |
|                                                                    |   | AverageBalance                          |    |   | InterestIncome/Expense |   |   | Yield/Cost |   |   | AverageBalance |   |   | InterestIncome/Expense |   |   | Yield/Cost |   |
|                                                                    |   | (Dollars in thousands)                  |    |
| Interest-earning assets:                                                |   |                                    |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans                                                                   |   | $                                       | 116,049 |   |   | $ | 4,809 |   |   |   | 5.53 | % |   | $ | 124,995 |   |   | $ | 5,333 |   |   |   | 5.69 | % |
| Securities - taxable                                                    |   |                                    | 55,042  |   |   |   | 1,124 |   |   |   | 2.72 |   |   |   | 37,676 |   |   |   | 983 |   |   |   | 3.48 |   |
| Mortgage-backed securities                                              |   |                                    | 26,481  |   |   |   | 634 |   |   |   | 3.19 |   |   |   | 28,386 |   |   |   | 889 |   |   |   | 4.18 |   |
| State and Municipal securities (1)                                      |   |                                    | 146     |   |   |   | 3 |   |   |   | 3.65 |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Other                                                                   |   |                                    | 10,611  |   |   |   | 12 |   |   |   | 0.15 |   |   |   | 5,771 |   |   |   | 5 |   |   |   | 0.12 |   |
| Total interest-earning assets                                           |   |                                    | 208,329 |   |   |   | 6,582 |   |   |   | 4.21 | % |   |   | 196,828 |   |   |   | 7,210 |   |   |   | 4.88 | % |
| Non-interest-earning assets                                             |   |                                    | 8,979   |   |   |   |   |   |   |   |   |   |   |   | 4,513 |   |   |   |   |   |   |   |   |   |
| Total assets                                                            |   | $                                       | 217,308 |   |   |   |   |   |   |   |   |   |   | $ | 201,341 |   |   |   |   |   |   |   |   |   |
|                                                                    |   |                                    |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities:                                           |   |                                    |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                    |   |                                    |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NOW accounts                                                            |   | $                                       | 10,074  |   |   | $ | 48 |   |   |   | 0.64 | % |   | $ | 8,118 |   |   | $ | 41 |   |   |   | 0.67 | % |
| Passbook savings                                                        |   |                                    | 26,900  |   |   |   | 169 |   |   |   | 0.84 |   |   |   | 14,476 |   |   |   | 76 |   |   |   | 0.70 |   |
| Money market savings Individual retirement accounts                |   |                                    | 25,380  |   |   |   | 189 |   |   |   | 0.99 |   |   |   | 20,182 |   |   |   | 267 |   |   |   | 1.76 |   |
|                                                                    |   | 18,235                                  |    |   |   | 393 |   |   |   | 2.87 |   |   |   | 17,519 |   |   |   | 494 |   |   |   | 3.76 |   |
| Certificates of deposit                                                 |   |                                    | 77,364  |   |   |   | 1,179 |   |   |   | 2.03 |   |   |   | 75,369 |   |   |   | 1,708 |   |   |   | 3.02 |   |
| Borrowings                                                              |   |                                    | 31,143  |   |   |   | 973 |   |   |   | 4.17 |   |   |   | 38,703 |   |   |   | 1,235 |   |   |   | 4.25 |   |
| Total interest-bearing liabilities                                      |   |                                    | 189,096 |   |   |   | 2,951 |   |   |   | 2.08 | % |   |   | 174,367 |   |   |   | 3,821 |   |   |   | 2.92 | % |
| Non-interest-bearing liabilities:                                       |   |                                    |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand deposits                                                         |   |                                    | 4,127   |   |   |   |   |   |   |   |   |   |   |   | 3,580 |   |   |   |   |   |   |   |   |   |
| Other                                                                   |   |                                    | 3,291   |   |   |   |   |   |   |   |   |   |   |   | 3,154 |   |   |   |   |   |   |   |   |   |
| Total liabilities                                                       |   |                                    | 196,514 |   |   |   |   |   |   |   |   |   |   |   | 181,101 |   |   |   |   |   |   |   |   |   |
| Stockholders’ equity                                              |   |                                    | 20,794  |   |   |   |   |   |   |   |   |   |   |   | 20,240 |   |   |   |   |   |   |   |   |   |
| Total liabilities and stockholders’ equity                        |   | $                                       | 217,308 |   |   |   |   |   |   |   |   |   |   | $ | 201,341 |   |   |   |   |   |   |   |   |   |
|                                                                    |   |                                    |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                                     |   |                                    |    |   |   | $ | 3,631 |   |   |   |   |   |   |   |   |   |   | $ | 3,389 |   |   |   |   |   |
| Interest rate spread (2)                                                |   |                                    |    |   |   |   |   |   |   |   | 2.13 | % |   |   |   |   |   |   |   |   |   |   | 1.96 | % |
| Net interest-earning assets (3)                                         |   | $                                       | 19,233  |   |   |   |   |   |   |   |   |   |   | $ | 22,461 |   |   |   |   |   |   |   |   |   |
| Net interest margin (4)                                                 |   |                                    |    |   |   |   | 2.32 | % |   |   |   |   |   |   |   |   |   |   | 2.30 | % |   |   |   |   |
| Average interest-earning assets to average interest-bearing liabilities |   |                                    | 110     | % |   |   |   |   |   |   |   |   |   |   | 113 | % |   |   |   |   |   |   |   |   |

| (1) | Tax-exempt interest income is presented on a tax equivalent basis using a 35 percent federal tax rate. |
|-----|--------------------------------------------------------------------------------------------------------|

| (2) | Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. |
|-----|--------------------------------------------------------------------------------------------------------------|

| (4) | Net interest margin represents net interest income divided by total interest-earning assets. |
|-----|----------------------------------------------------------------------------------------------|

----

----

----

----

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----

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|   | (a) | There were no sales of unregistered securities during the period covered by this Report. |
|--------|-----|------------------------------------------------------------------------------------------|

|   | (b) | Not applicable. |
|--------|-----|-----------------|

|   | (c) | There were no issuer repurchases of securities during the period covered by this Report. |
|--------|-----|------------------------------------------------------------------------------------------|

|   | 3.1    | Charter of FSB Community Bankshares, Inc.*                                                         |
|--------|--------|----------------------------------------------------------------------------------------------------|
|   |   |                                                                                               |
|   | 3.2    | Bylaws of FSB Community Bankshares, Inc.*                                                          |
|   |   |                                                                                               |
|   | 4      | Form of Common Stock Certificate of FSB Community Bankshares, Inc.*                                |
|   |   |                                                                                               |
|   | 10.1   | Supplemental Executive Retirement Plan*                                                            |
|   |   |                                                                                               |
|   | 10.2   | Form of Employee Stock Ownership Plan*                                                             |
|   |   |                                                                                               |
|   | 10.3   | Supplemental Executive Retirement Plan for K. Maroney**                                            |
|   |   |                                                                                               |
|   | 31.1   | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |

----

|   | 31.2   | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                     |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                   |
|   | 32     | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                    |
|   |   |                                                                                                                                                                                                   |   |   |
|   | *      | Filed as exhibits to the Company’s Registration Statement on Form SB-2, and any amendments thereto, with the Securities and Exchange Commission (Registration No. 333-141380) on March 16, 2007. |
|   |   |                                                                                                                                                                                                   |
|   | **     | Filed as an exhibit to the Company’s Current Report on Form 8-K, file with the Securities and Exchange Commission on August 4, 2010.                                                             |

----

|                                     |   |   | FSB COMMUNITY BANKSHARES, INC.                       |   |
|------------------------------------------|--------|--------|------------------------------------------------------|--------|
|                                     |   |   |                                                 |   |
| Date:   November 12, 2010 |   |   | /s/ Dana C. Gavenda                                  |   |
|                                     |   |   | Dana C. Gavenda                                      |   |
|                                     |   |   | President and Chief Executive Officer                |   |
|                                     |   |   |                                                 |   |
| Date:   November 12, 2010 |   |   | /s/ Kevin D. Maroney                            |   |
|                                     |   |   | Kevin D. Maroney                                     |   |
|                                     |   |   | Executive Vice President and Chief Financial Officer |   |