U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB
(Mark One)

 X   Quarterly report under Section 13 or 15(d) of the
---- Securities Exchange Act of 1934

For the quarterly period ended September 30, 1999

     Transition report under Section 13 or 15(d) of the Exchange Act

For the transition period from           to
                               ---------    ------------
Commission file number 333-19201

                          THE COMMERCIAL BANCORP, INC.
        (Exact Name of Small Business Issuer as Specified in Its Charter)

        Florida                                   59-3396236
        -------                                   ----------
(State or Other Jurisdiction                    (I.R.S. Employer
of Incorporation or Organization)              Identification No.)

                               258 North Nova Road
                           Ormond Beach, Florida 32174
                    ----------------------------------------
                    (Address of Principal Executive Offices)

                                 (904) 672-3003
                ------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)


         ---------------------------------------------------------------
         (Former Name, Former Address and Former Fiscal Year, if Changed
                               Since Last Report)

   Check  whether  the  issuer:  (1) filed all  reports  required to be filed by
Section  12, 13 or 15(d) of the  Exchange  Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports),  and
(2) has been subject to such filing requirements for the past 90 days:

YES  X    NO

   State the number of shares  outstanding  of each of the  issuer's  classes of
common equity, as of the latest practicable date;



Common stock, par value $.01 per share                 475,091 shares
--------------------------------------       -------------------------------
               (class)                      Outstanding at September 30, 1999


--------------------------------------------------------------------------------

<PAGE>






                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY

                                      INDEX
<TABLE>
<CAPTION>
<S>                                                                                                         <C>
Part I. Financial Information

   Item 1. Financial Statements                                                                              Page

     Condensed Consolidated Balance Sheets -
       At September 30, 1999 (unaudited) and At December 31, 1998...............................................2

     Condensed Consolidated Statements of Operations -
       Three and Nine Months ended September 30, 1999 and 1998 (unaudited)......................................3

     Condensed Consolidated Statement of Stockholders' Equity -
       Nine Months ended September 30, 1999 (unaudited).........................................................4

     Condensed Consolidated Statements of Cash Flows -
       Nine months ended September 30, 1999 and 1998 (unaudited)................................................5

     Notes to Condensed Consolidated Financial Statements (unaudited).........................................6-8

   Item 2. Management's Discussion and Analysis or Plan
     of Operations...........................................................................................9-12

Part II. Other Information

   Item 1.  Legal Proceedings..................................................................................13

   Item 2.  Changes in Securities and Use of Proceeds..........................................................13

   Item 6.  Exhibits and Reports on Form 8-K...................................................................13

SIGNATURES.....................................................................................................14
</TABLE>

                                      -1-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY


                          PART I. FINANCIAL INFORMATION

                          Item 1. Financial Statements

                      Condensed Consolidated Balance Sheets
<TABLE>
<CAPTION>

                                                                                                     At
                                                                                     ----------------------------------
                                                                                     September 30,         December 31,
                                                                                     -------------         ------------
    Assets                                                                                1999                 1998
    ------                                                                                ----                 ----
                                                                                        (unaudited)
<S>                                                                                    <C>                  <C>

Cash and due from banks.........................................................       $    699,772            689,903
Federal funds sold  ............................................................          1,320,452          4,258,602
                                                                                         ----------         ----------

            Total cash and cash equivalents.....................................          2,020,224          4,948,505

Securities available for sale...................................................          5,190,524          3,302,486
Loans, net of allowance for loan losses of $326,871
    in 1999 and $760,000 in 1998................................................         14,165,464         11,563,373
Premises and equipment, net.....................................................            542,953            838,931
Accrued interest receivable.....................................................            118,632             89,527
Restricted security, Federal Home Loan Bank stock, at cost......................             64,500             50,000
Deferred tax asset  ............................................................            831,011            824,981
Other assets        ............................................................             52,246             58,003
                                                                                         ----------         ----------
            Total assets........................................................       $ 22,985,554         21,675,806
                                                                                         ==========         ==========
    Liabilities and Stockholders' Equity

Liabilities:
    Noninterest-bearing demand deposits.........................................          1,108,692            904,585
    Savings and NOW deposits....................................................          4,656,897          5,068,758
    Money-market deposits.......................................................            322,215            329,293
    Time deposits   ............................................................         12,385,620         10,482,545
                                                                                         ----------         ----------

            Total deposits......................................................         18,473,424         16,785,181

    Advance from Federal Home Loan Bank.........................................          1,000,000          1,000,000
    Other borrowings............................................................             -                 364,749
    Official checks ............................................................             78,489            127,342
    Other liabilities...........................................................             85,645            141,642
                                                                                         ----------         ----------

            Total liabilities...................................................         19,637,558         18,418,914
                                                                                         ----------         ----------
Stockholders' equity:
    Common stock, $.01 par value; 10,000,000 shares authorized,
        475,091 and 464,791 shares issued and outstanding.......................              4,751              4,648
    Additional paid-in capital..................................................          4,731,439          4,628,542
    Accumulated deficit.........................................................         (1,372,033)        (1,370,803)
    Accumulated other comprehensive income (loss)...............................            (16,161)            (5,495)
                                                                                         ----------         ----------

            Total stockholders' equity..........................................          3,347,996          3,256,892
                                                                                         ----------         ----------
            Total liabilities and stockholders' equity..........................       $ 22,985,554         21,675,806
                                                                                         ==========         ==========
</TABLE>

See Accompanying Notes to Condensed Consolidated Financial Statements.

                                      -2-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY


                 Condensed Consolidated Statements of Operations


<TABLE>
<CAPTION>

                                                                         Three Months Ended          Nine Months Ended
                                                                           September 30,                 September 30,
                                                                         ------------------          -----------------
                                                                          1999          1998          1999           1998
                                                                          ----          ----          ----           ----
                                                                          (unaudited)                   (unaudited)
Interest income:
<S>                                                                    <C>             <C>            <C>           <C>
    Loans   .....................................................      $ 277,258       211,856        780,410       499,295
    Securities available for sale................................         49,643        51,158        117,448        82,638
    Other interest-earning assets................................         32,419        24,842        105,710       131,841
                                                                        --------      --------     ----------       -------

            Total interest income................................        359,320       287,856      1,003,568       713,774
                                                                        --------      --------     ----------       -------
Interest expense:
    Deposits.....................................................        198,278       180,280        548,589       415,410
    Other   .....................................................         12,267         7,566         50,093         9,358
                                                                        --------      --------     ----------       -------

            Total interest expense...............................        210,545       187,846        598,682       424,768
                                                                        --------      --------     ----------       -------
            Net interest income..................................        148,775       100,010        404,886       289,006

(Credit) provision for loan losses...............................       (150,000)      190,000       (281,000)      245,000
                                                                        --------      --------     ----------       -------

            Net interest income (expense) after
              (credit) provision for loan losses.................        298,775       (89,990)       685,886        44,006
                                                                        --------      --------     ----------       -------
Noninterest income:
    Service charges and fees.....................................         17,578        17,407         40,924        36,178
    Recovery of organizational expenses..........................         -            -              109,609        -
                                                                        --------      --------     ----------       -------

            Total noninterest income.............................         17,578        17,407        150,533        36,178
                                                                        --------      --------     ----------       -------
Noninterest expense:
    Salaries and employee benefits...............................        104,692       154,141        414,744       367,187
    Occupancy expense............................................         68,806        65,356        182,178       153,787
    Professional fees............................................         15,920        21,403         70,421        37,599
    Advertising..................................................         11,192        17,498         19,570        66,698
    Other   .....................................................         46,581        61,853        151,436       171,879
                                                                        --------      --------     ----------       -------

            Total noninterest expense............................        247,191       320,251        838,349       797,150
                                                                        --------      --------     ----------       -------
Earnings (loss) before income tax provision (benefit)............         69,162      (392,834)        (1,930)     (716,966)

            Income tax provision (benefit).......................         26,000      (134,900)          (700)     (238,100)
                                                                        --------      --------     ----------       -------
Net earnings (loss)..............................................      $  43,162      (257,934)        (1,230)     (478,866)
                                                                         =======       =======       ========       =======

Earnings (loss) per share, basic and diluted.....................      $     .09          (.55)          (.00)         (1.03)
                                                                         =======       =======       ========       =======

Weighted-average number of shares outstanding
    for basic and diluted........................................        475,083       464,791        470,640       464,791
                                                                         =======       =======       ========       =======

     Dividends per share.........................................      $   -            -              -             -
                                                                         =======       =======       ========       =======
</TABLE>

                                      -3-

See Accompanying Notes to Condensed Consolidated Financial Statements.

<PAGE>

                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY

            Condensed Consolidated Statement of Stockholders' Equity

                      Nine Months Ended September 30, 1999

<TABLE>
<CAPTION>

                                                                                                   Accumulated
                                                                                                      Other
                                                                       Additional                     Compre-          Total
                                                            Common      Paid-In       Accumulated    hensive       Stockholders'
                                                            Stock       Capital       Deficit         Income           Equity
                                                            -----       -------       -------         ------           ------

<S>                                                        <C>          <C>            <C>            <C>            <C>
Balance at December 31, 1998.........................      $ 4,648      4,628,542      (1,370,803)     (5,495)       3,256,892
                                                                                                                     ---------

Comprehensive income (loss):
     Net loss (unaudited)............................        -             -               (1,230)      -               (1,230)

     Net change in unrealized loss on
         securities available for sale,
         net of tax benefit of $5,330
         (unaudited).................................        -             -               -          (10,666)         (10,666)
                                                                                                                     ---------

Comprehensive income (loss) (unaudited)..............                                                                  (11,896)
                                                                                                                     ---------

Issuance of 10,300 shares of common
     stock upon exercise of 10,300
     warrants (unaudited)............................          103        102,897          -            -              103,000
                                                            ------     ----------    ------------   ---------        ---------

Balance at September 30, 1999 (unaudited)............      $ 4,751      4,731,439      (1,372,033)    (16,161)       3,347,996
                                                             =====      =========       =========      ======        =========

</TABLE>























See Accompanying Notes to Condensed Consolidated Financial Statements.

                                      -4-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY


                 Condensed Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>

                                                                                               Nine Months Ended
                                                                                                 September 30,
                                                                                             ---------------------
                                                                                             1999             1998
                                                                                             ----             ----
                                                                                                 (unaudited)
<S>                                                                                       <C>              <C>
Cash flows from operating activities:
    Net loss........................................................................      $   (1,230)        (478,866)
    Adjustments to reconcile net loss to net cash
      used in operating activities:
        Depreciation................................................................          71,694           38,737
        (Credit) provision for loan losses..........................................        (281,000)         245,000
        Credit for deferred income taxes............................................            (700)        (238,100)
        Net amortization of fees, costs, premiums and discounts.....................          65,954           29,619
        Increase in accrued interest receivable and other assets....................         (23,348)        (173,718)
        (Decrease) increase in accrued interest payable and
          other liabilities.........................................................         (55,997)         258,769
                                                                                         -----------     ------------

        Net cash used in operating activities.......................................        (224,627)        (318,559)
                                                                                          ----------     ------------

Cash flows from investing activities:
    Purchases of securities available for sale......................................      (3,237,218)      (6,187,015)
    Principal repayments on securities available for sale...........................       1,294,855        1,620,973
    Net increase in loans...........................................................      (2,348,716)      (6,125,541)
    Purchases of premises and equipment.............................................         (69,100)        (382,940)
    Net proceeds from sale of premises and equipment................................         293,384          -
    Purchase of Federal Home Loan Bank stock........................................         (14,500)         -
                                                                                         -----------       ----------

        Net cash used in investing activities.......................................      (4,081,295)     (11,074,523)
                                                                                           ---------       ----------

Cash flows from financing activities:
    Net (decrease) increase in demand, savings, NOW and
        money-market deposits.......................................................        (214,832)       2,737,440
    Net increase in time deposits...................................................       1,903,075        9,171,591
    Net decrease in other borrowings................................................        (364,749)          -
    Net (decrease) increase in official checks......................................         (48,853)         119,335
    Proceeds from issuance of common stock upon exercise
        of warrants.................................................................         103,000           -
                                                                                          ----------       -----------

        Net cash provided by financing activities...................................       1,377,641       12,028,366
                                                                                           ---------       ----------

Net (decrease) increase in cash and cash equivalents................................      (2,928,281)         635,284

Cash and cash equivalents at beginning of period....................................       4,948,505        2,465,817
                                                                                           ---------      -----------

Cash and cash equivalents at end of period..........................................    $  2,020,224        3,101,101
                                                                                           =========      ===========

Supplemental  disclosure of cash flow  information:  Cash paid during the period
    for:
        Interest....................................................................   $     595,663          399,329
                                                                                         ===========     ============

        Income taxes................................................................$          -               -
                                                                                      ==============     ============

    Noncash transactions-
        Accumulated other comprehensive  income (loss), net change in unrealized
          (loss) gain on securities available for sale,
          net of tax................................................................   $     (10,666)          10,388
                                                                                         ===========     ============
</TABLE>


See Accompanying Notes to Condensed Consolidated Financial Statements.

                                      -5-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY


        Notes to Condensed Consolidated Financial Statements (unaudited)


(1)     General  Description and Basis of Presentation.  The Commercial Bancorp,
        Inc. (the "Holding  Company") was  incorporated  on August 15, 1996. The
        Holding  Company  owns  100%  of the  outstanding  common  stock  of The
        Commercial Bank of Volusia County (the "Bank")  (together,  "TCB").  The
        Holding Company was organized  simultaneously with the Bank and its only
        business  is the  ownership  and  operation  of the Bank.  The Bank is a
        Florida state-chartered  commercial bank and its deposits are insured by
        the Federal Deposit Insurance Corporation.  The Bank opened for business
        on  October  14,  1997,  and  provides  community  banking  services  to
        businesses and individuals in Volusia County, Florida.

        In the opinion of the  management  of TCB,  the  accompanying  condensed
        consolidated financial statements contain all adjustments (consisting of
        normal  recurring  accruals)  necessary to present  fairly the financial
        position at  September  30, 1999 and the results of  operations  for the
        three and nine months ended  September  30, 1999 and 1998 and cash flows
        for the nine months ended  September  30, 1999 and 1998.  The results of
        operations and other data for the three and nine months ended  September
        30, 1999, are not necessarily indicative of results that may be expected
        for the year ending December 31, 1999.

        The condensed  consolidated financial statements include the accounts of
        the Holding Company and the Bank. All significant  intercompany accounts
        and transactions have been eliminated in consolidation.

(2)     Loan Impairment and Loan Losses. The following summarizes the collateral
        dependent amounts of impaired loans:
<TABLE>
<CAPTION>

                                                                                                     At
                                                                                      ----------------------------------
                                                                                      September 30,         December 31,
                                                                                          1999                 1998
                                                                                          ----                 ----
           Loans identified as impaired:
<S>                                                                                <C>                      <C>
                 Gross loans with no related allowance for loan losses             $      -                     -
                 Gross loans with related allowance for loan losses recorded              -                 1,199,025
                 Less: Allowances on these loans                                          -                  (599,512)
                                                                                      ----------             --------

           Net investment in impaired loans                                         $     -                   599,513
                                                                                      ==========            =========
</TABLE>

        The  average  net  investment  in  impaired  loans and  interest  income
        recognized and received on impaired loans is as follows:
<TABLE>
<CAPTION>

                                                                    Three Months Ended          Nine Months Ended
                                                                        September 30,              September 30,
                                                                        -------------              -------------
                                                                      1999           1998         1999          1998
                                                                      ----           ----         ----          ----

<S>                                                                 <C>            <C>          <C>          <C>
           Average net investment in impaired loans...............  $ 298,638      507,684      465,791      169,228
                                                                      =======      =======      =======      =======
           Interest income recognized on impaired loans...........  $     -         14,185      -              44,366
                                                                      =======      =======      =======      =======
           Interest income received on impaired loans.............  $     -          -          -             21,689
                                                                      =======      =======      =======      =======
</TABLE>

                                                                     (continued)

                                      -6-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY

   Notes to Condensed Consolidated Financial Statements (unaudited), Continued


(2) Loan Impairment and Loan Losses, Continued.
        The activity in the allowance for loan losses was as follows:
<TABLE>
<CAPTION>

                                                                       Three Months Ended         Nine Months Ended
                                                                          September 30,             September 30,
                                                                          -------------             -------------
                                                                      1999            1998         1999        1998
                                                                      ----            ----         ----        ----

<S>                                                                 <C>            <C>          <C>           <C>
           Balance at beginning of period........................   $ 556,458       90,000      760,000       35,000
           (Credit) provision for loan losses....................    (150,000)     190,000     (281,000)     245,000
           Loan charge-offs, net of recoveries...................     (79,587)      -          (152,129)       -
                                                                     --------  -----------      -------      -------

           Balance at end of period..............................   $ 326,871      280,000      326,871      280,000
                                                                      =======      =======      =======      =======
</TABLE>

(3)     Earnings  (Loss) Per Share  ("EPS").  Basic EPS has been computed on the
        basis  of  the  weighted-average   number  of  shares  of  common  stock
        outstanding. TCB=s common stock equivalents are not dilutive.

                                                                     (continued)

                                      -7-
<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY


   Notes to Condensed Consolidated Financial Statements (unaudited), Continued


(4)        Regulatory  Matters.  The Holding Company and the Bank are subject to
           various  regulatory  capital  requirements  administered  by  various
           regulatory   banking  agencies.   Failure  to  meet  minimum  capital
           requirements can initiate certain  mandatory and possibly  additional
           discretionary actions by regulators that, if undertaken, could have a
           direct material effect on TCB's financial  statements.  Under capital
           adequacy   guidelines  and  the   regulatory   framework  for  prompt
           corrective  action,  the Bank must meet specific  capital  guidelines
           that involve quantitative measures of the Bank's assets, liabilities,
           and certain  off-balance-sheet  items as calculated  under regulatory
           accounting  practices.  The Bank's capital amounts and classification
           are also subject to qualitative  judgements by the  regulators  about
           components, risk weightings, and other factors.

           Quantitative  measures  established  by regulation to ensure  capital
           adequacy require the Bank to maintain minimum amounts and ratios (set
           forth in the table  below) of total and Tier I capital (as defined in
           the regulations) to risk-weighted assets (as defined),  and of Tier I
           capital  (as  defined)  to average  assets (as  defined).  Management
           believes,  at September 30, 1999, that TCB meets all capital adequacy
           requirements to which it is subject.

           As of  September  30,  1999,  the most recent  notification  from the
           regulatory authorities categorized the Bank as well capitalized under
           the  regulatory   framework  for  prompt  corrective  action.  To  be
           categorized as well capitalized, the Bank must maintain minimum total
           risk-based,  Tier I  risk-based,  and Tier I  leverage  ratios as set
           forth in the  table.  There are no  conditions  or events  since that
           notification  that  management   believes  have  changed  the  Bank's
           category.  The  Bank's  actual  capital  amounts  and ratios are also
           presented in the table (dollars in thousands).
<TABLE>
<CAPTION>

                                                                                                    To Be Well
                                                                         Minimum                  Capitalized Under
                                                                       For Capital                  Prompt Corrective
                                                Actual               Adequacy Purposes:           Action Provisions:
                                       -----------------------      -----------------------     -----------------------
                                       Amount            %          Amount           %          Amount            %
                                       ------            -          ------           -          ------            -
<S>                                   <C>                <C>     <C>                 <C>    <C>                  <C>
     At September 30, 1999:
         Total capital (to Risk-
         Weighted Assets)...........  $ 2,733            17.6%   $ 1,241             8.0%   $ 1,552              10.0%
         Tier I Capital (to Risk-
         Weighted Assets)...........    2,537            16.3        621             4.0         931              6.0
         Tier I Capital
         (to Average Assets)........    2,537            12.0        846             4.0       1,058              5.0
</TABLE>

                                      -8-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY


                  Item 2. Management's Discussion and Analysis
                              or Plan of Operations

       Comparison of September 30, 1999 (Unaudited) and December 31, 1998


General
     The Commercial  Bancorp,  Inc. (the "Holding  Company") was incorporated on
     August 15, 1996. The Holding  Company owns 100% of the  outstanding  common
     stock of The  Commercial  Bank of Volusia  County (the  "Bank")  (together,
     "TCB"). The Holding Company was organized  simultaneously with the Bank and
     its only business is the ownership and operation of the Bank. The Bank is a
     Florida state-chartered commercial bank and its deposits are insured by the
     Federal  Deposit  Insurance  Corporation.  The Bank opened for  business on
     October 14, 1997, and provides community banking services to businesses and
     individuals in Volusia County, Florida.

New Bank Charter
     TCB along with a group of local organizers made application to the State of
     Florida for a bank charter in Highlands County, Florida. Management planned
     to raise  the  capital  for the new bank  from a public  offering  of TCB=s
     common  stock.  In  early  1999,  TCB and  the  organizers  withdrew  their
     application  and management  terminated its planned  public  offering.  The
     application was assumed by the local organizers and others, as a result TCB
     was able to  recover  some of the  organizational  expenses  which had been
     previously  expensed.  This amount is included in noninterest income in the
     nine months ended  September 30, 1999.  In addition,  TCB sold property and
     equipment which had been purchased for the proposed  Highlands County Bank,
     to the local organizers.

Liquidity and Capital Resources
     TCB's  primary  source of cash during the nine months ended  September  30,
     1999 was from net deposit inflows of $1.7 million and principal  repayments
     on  securities  of  $1.3  million.   Cash  was  used   primarily  for  loan
     originations  net of repayments of $2.3 million and to purchase  securities
     of $3.2 million. At September 30, 1999, TCB had unfunded lines of credit of
     approximately  $1.5  million.  At  September  30,  1999,  TCB  exceeded its
     regulatory liquidity requirements.

     The following  table shows selected  ratios for the periods ended or at the
dates indicated:
<TABLE>
<CAPTION>

                                                                      Nine Months                      Nine Months
                                                                         Ended          Year Ended        Ended
                                                                     September 30,      December 31,   September 30,
                                                                         1999              1998           1998
                                                                     -------------      ------------   -------------
<S>                                                                     <C>               <C>            <C>
        Average equity as a percentage
           of average assets.......................................     15.48%            22.51%         26.46%

        Total equity to total assets at end of period..............     14.57%            15.03%         20.46%

        Return on average assets (1)...............................      (.01%)           (6.35%)        (4.12%)

        Return on average equity (1)...............................      (.04%)          (28.23%)       (15.57%)

        Noninterest expense to average assets (1)..................      3.98%             7.32%          6.86%

        Nonperforming loans and foreclosed real estate
           as a percentage of total assets at end of period........      1.04%             5.53%           NIL

        Allowance for loan losses as a percentage of
           total loans at end of period............................      2.25%             6.17%          2.79%
</TABLE>


        (1)  Annualized for the nine months ended September 30, 1999 and 1998.

                                      -9-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY


                  Item 2. Management's Discussion and Analysis
                        or Plan of Operations, Continued

Results of Operations

     Comparison of the Three-Month Periods Ended September 30, 1999 and 1998

   General.  Net  earnings for the three  months  ended  September  30, 1999 was
      $43,162,  or $.09 per basic and diluted  share  compared to a net loss for
      the three months ended  September 30, 1998 of $257,934,  or $.55 per basic
      and diluted  share.  Net earnings for the 1999 period  included a $150,000
      credit for loan losses due to a recovery  resulting from the settlement of
      two  impaired  loans to a single  borrower.  Without this credit TCB would
      have  reported  a loss for the  period.  During  the  three  months  ended
      September  30,  1999,  TCB had not  achieved  the  asset  size to  operate
      profitably from operations.

   Interest Income.  Interest income increased  $71,464 or 24.8% to $359,320 for
      the three  months  ended  September  30, 1999 from  $287,856 for the three
      months ended September 30, 1998. Interest income earned on loans increased
      $65,402 or 30.9% to $277,258 for the three months ended September 30, 1999
      from  $211,856  during the three months  ended  September  30,  1998.  The
      increase  was due to an  increase in the average  loan  portfolio  of $4.5
      million or 48.5% for the three months ended September 30, 1999 compared to
      the same  period in 1998,  partially  offset by a decrease  in the average
      yield earned from 9.08% in 1998 to 7.99% in 1999.

   Interest Expense. Interest expense increased $22,699 or 12.1% to $210,545 for
      the three  months  ended  September  30, 1999 from  $187,846 for the three
      months ended  September 30, 1998.  This increase was due to an increase in
      average interest-bearing  liabilities outstanding of $3.4 million or 23.9%
      during the three months ended September 30, 1999 when compared to the same
      period in 1998,  partially  offset by a decrease in the average  rate paid
      from 5.29% in 1998 to 4.77% in 1999.

   (Credit) Provision for Loan Losses. The (credit) provision for loan losses is
      (credited) charged to earnings to (decrease)  increase the total allowance
      to a level deemed  appropriate  by management and is based upon the volume
      and type of lending  conducted by TCB, industry  standards,  the amount of
      nonperforming loans and general economic conditions,  particularly as they
      relate  to  TCB's  market  areas,   and  other  factors   related  to  the
      collectibility of TCB's loan portfolio. The credit for loan losses for the
      three months ended  September  30, 1999 was $150,000 and the allowance for
      loan losses was $326,871 at September 30, 1999. The credit for loan losses
      resulted from a settlement of two impaired  loans from a single  borrower.
      This resulted in the partial  recapture of the loan loss allowance against
      these loans.  Management  believes the  allowance is adequate at September
      30, 1999.

   Noninterest  Income.  Noninterest  income  remained  relatively  unchanged at
      $17,578 for the three months ended  September 30, 1999 compared to $17,407
      for the same period in 1998.

   Noninterest  Expense.  Noninterest  expense  decreased  $73,060  or  22.8% to
      $247,191 for the three months ended  September  30, 1999 from $320,251 for
      the three months ended  September  30, 1998.  This decrease was mainly the
      result of a decrease in salaries and employee  benefits of $49,449 related
      to the personnel  requirements  under the planned new bank charter  during
      the 1998 period which was terminated in early 1999.

   Income Tax Provision (Benefit). The income tax provision for the three months
      ended September 30, 1999 was $26,000 (an effective rate of 37.6%) compared
      to an income tax benefit of $134,900 (an effective  rate of 34.3%) for the
      three months ended September 30, 1998.

                                      -10-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY


                  Item 2. Management's Discussion and Analysis
                        or Plan of Operations, Continued

Results of Operations, Continued

     Comparison of the Nine-Month Periods Ended September 30, 1999 and 1998

   General. Net loss for the nine months ended September 30, 1999 was $1,230, or
      $.01 per  basic  and  diluted  share  compared  to a net loss for the nine
      months ended September 30, 1998 of $478,866 or $1.03 per basic and diluted
      share.  Net loss for the 1999  period  included  a  $109,609  recovery  of
      previously  expensed  organizational  costs and a $281,000 credit for loan
      losses due to the  settlement  of four  impaired  loans to two  borrowers.
      During the nine months ended  September 30, 1999, TCB had not achieved the
      asset size to operate profitably from operations.

   Interest Income.  Interest income  increased  $289,794 or 40.6% to $1,003,568
      for the nine months ended  September  30, 1999 from  $713,774 for the nine
      months ended September 30, 1998. Interest income earned on loans increased
      $281,115 or 56.3% to $780,410 for the nine months ended September 30, 1999
      from  $499,295  during the nine  months  ended  September  30,  1998.  The
      increase  was due to an  increase in the average  loan  portfolio  of $5.7
      million or 75.3% for the nine months ended  September 30, 1999 compared to
      the same  period in 1998,  partially  offset by a decrease  in the average
      yield earned from 8.80% in 1998 to 7.84% in 1999.

   Interest Expense.  Interest expense  increased  $173,914 or 40.9% to $598,682
      for the nine months ended  September  30, 1999 from  $424,768 for the nine
      months ended  September 30, 1998.  This increase was due to an increase in
      average interest-bearing  liabilities outstanding of $5.8 million or 53.1%
      during the nine  months  ended  September  30,  1999  compared to the same
      period in 1998,  partially  offset by a decrease in the average  rate paid
      from 5.19% in 1998 to 4.78% in 1999.

   (Credit) Provision for Loan Losses. The (credit) provision for loan losses is
      (credited) charged to earnings to (decrease)  increase the total allowance
      to a level deemed  appropriate  by management and is based upon the volume
      and type of lending  conducted by TCB, industry  standards,  the amount of
      nonperforming loans and general economic conditions,  particularly as they
      relate  to  TCB's  market  areas,   and  other  factors   related  to  the
      collectibility of TCB's loan portfolio. The credit for loan losses for the
      nine months ended  September  30, 1999 was $281,000 and the  allowance for
      loan losses was $326,871 at September 30, 1999. The credit for loan losses
      resulted from a settlement  of four impaired  loans for less than the full
      amount.  This resulted in the partial  recapture of the allowance  against
      these loans and a charge-off of the remaining  loan  balances.  Management
      believes the allowance is adequate at September 30, 1999.

   Noninterest Income.  Noninterest income increased to $150,533 during the nine
      months ended September 30, 1999 compared to $36,178 for the same period in
      1998. This increase was primarily due to a recovery of previously expensed
      organizational   costs  related  to  the  Highlands  County  Bank  charter
      application of $109,609. TCB and the organizers withdrew their application
      for the new bank in early 1999 but recovered certain  previously  expensed
      organizational costs from local organizers who assumed the application.

   Noninterest  Expense.  Noninterest  expense  increased  $41,199  or  5.2%  to
      $838,349 for the nine months ended  September  30, 1999 from  $797,150 for
      the nine months  ended  September  30, 1998.  The largest  increase was in
      salaries and employee benefits of $47,557.

   Income Tax  Benefit.  The  income  tax  benefit  for the  nine  months  ended
      September  30,  1999 was $700 (an  effective  rate of 36.3%)  compared  to
      $238,100 (an effective rate of 33.2%) for the nine months ended  September
      30, 1998.

                                      -11-

<PAGE>






                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY



                                    Year 2000

TCB is acutely aware of the many areas affected by the Year 2000 computer issue,
including  those  addressed by the Federal  Financial  Institutions  Examination
Council  ("FFIEC") in its  interagency  statement  which provided an outline for
institutions to effectively  manage the Year 2000  challenges.  A Year 2000 plan
has been  approved by the Board of Directors  which  includes  multiple  phases,
tasks to be completed, and target dates for completion. Issues addressed therein
include awareness, assessment, renovation, validation,  implementation,  testing
and contingency planning.

TCB has formed a Year 2000  committee  that is  charged  with the  oversight  of
completing  the Year 2000  project  on a timely  basis.  TCB has  completed  its
awareness,  assessment,  renovation,  validation,   implementation  and  testing
phases.  Since it routinely  upgrades  and  purchases  technologically  advanced
software and hardware on a continual bases, TCB has determined that the costs of
making  modifications to correct any Year 2000 issues will not materially affect
reported results from operations.

TCB=s vendors and suppliers  have been  contacted  for written  confirmation  of
their product=s readiness for the Year 2000 compliance.  All significant vendors
of TCB have provided confirmation that they are Year 2000 compliant.  TCB=s main
service  provider  has  completed  testing of its mission  critical  application
software; the test results, which have been documented and validated, are deemed
to be Year 2000  compliant.  FFIEC  guidance on testing Year 2000  compliance of
service  providers states that proxy tests are acceptable  compliance  tests. In
proxy  testing,  the  service  provider  tests with a  representative  sample of
financial  institutions that use a particular service,  with the results of such
testing shared with all similarly situated clients of the service provider.  TCB
has  authorized  the acceptance of proxy testing since the proxy tests have been
conducted with financial institutions that are similar in type and complexity to
its own,  using  the same  version  of Year  2000  ready  software  and the same
hardware and operating  systems.  TCB personnel  have also  performed  Year 2000
testing on their  computer  databases and software  applications  and have found
them to be Year 2000 ready.

TCB also recognizes the importance of determining  that its borrowers are facing
the Year 2000  problem  in a timely  manner to avoid  deterioration  of the loan
portfolio  solely  due to this  issue.  All  material  relationships  have  been
identified and questionnaires  have been completed to assess the inherent risks.
Deposit customers have received statement  stuffers and information  material in
this regard.  TCB plans to work on a one-on-one  basis with any borrower who has
been identified as having high Year 2000 risk exposure.

Accordingly,  management  does not believe  that TCB has  incurred or will incur
material  costs  associated  with the Year  2000  issue.  Yet,  there  can be no
assurances  that all hardware  and software  that TCB will use will be Year 2000
compliant. Management cannot predict the amount of financial difficulties it may
incur due to  customers  and vendors  inability  to perform  according  to their
agreements  with TCB or the  effects  that other  third  parties  may cause as a
result of this issue.  Therefore,  there can be no assurance that the failure or
delay of others to address the issue or that the costs  involved in such process
will not have a material adverse effect on TCB=s business,  financial condition,
and results of operations.

TCB's contingency plans relative to Year 2000 issues have been finalized.  Based
on testing  results,  TCB's mission critical systems have been deemed to be Year
2000  compliant  and,  therefore a contingency  plan has not been developed with
respect to those systems.  A Business  Resumption  Contingency Plan (the "BRCP")
has been  developed  and  approved by the Board of  Directors.  The BRCP assumes
power outages and telephone disruptions.  TCB has tested and validated the BRCP.
It is anticipated that TCB's deposit  customers will have increased  demands for
cash in the latter part of 1999 and  correspondingly  TCB will  maintain  higher
liquidity levels.

                                      -12-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY



                           PART II. OTHER INFORMATION

Item 1. Legal Proceedings

There are no material pending legal proceedings to which The Commercial Bancorp,
Inc. or its subsidiary is a party or to which any of their property is subject.

Item 2. Changes in Securities and Use of Proceeds

During the quarter ended  September 30, 1999,  150 shares were issued to holders
of warrants at a purchase price of $10.00 per share.

Proceeds were used for general corporate purposes.

Item 6. Exhibits and Reports on Form 8-K

(a)   Exhibits.  The  following  exhibits  are  filed  with or  incorporated  by
      reference  into this report.  The  exhibits  which are  denominated  by an
      asterisk  (*)  were  previously  filed  as  a  part  of,  and  are  hereby
      incorporated by reference from TCB's  Registration  Statement on Form SB-2
      under the Securities Act of 1933 for TCB, as effective with the Securities
      and Exchange  Commission  on April 28, 1997,  Registration  No.  333-19201
      (referred  to  as  "Registration  Statement").   The  exhibits  which  are
      denominated  by a double  asterisk  (**) where  filed with TCB's 1998 Form
      10-KSB.  The exhibit  numbers  correspond  to the  exhibit  numbers in the
      referenced documents.

      Exhibit Number                      Description of Exhibit

        *3.1    Amended and Restated Articles of Incorporation of TCB
        *3.2    By-laws of TCB (Registration Statement)
        *4.1    Specimen Common Stock Certificate (Registration Statement)
        *4.2    Specimen Warrant Certificate (Registration Statement)
        *4.4    Company's Warrant Plan (Registration Statement)
      **22.1    TCB's 1999 Annual Meeting Proxy Statement
      **22.2    TCB's 1998 Annual Report
        27      Financial Data Schedule (for SEC use only)


(b)  Reports on Form 8-K.  There were no reports on Form 8-K filed for the three
     months ended September 30, 1999.

                                      -13-

<PAGE>



                   THE COMMERCIAL BANCORP, INC. AND SUBSIDIARY


                           PART II. OTHER INFORMATION


                                   SIGNATURES



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


                                                    THE COMMERCIAL BANCORP, INC.
                                                    (Registrant)





Date:       , 1999                      By:  /s/Gary G. Campbell
------------------                           -------------------
                                                Gary G. Campbell, President and
                                                Chief Executive Officer




Date:       , 1999                      By:  /s/Harvey E. Buckmaster
------------------                           -----------------------
                                                Harvey E. Buckmaster,
                                                Chief Financial Officer


                                      -14-