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

                                    FORM 10-Q

[X] Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act of
1934

                     For the quarterly period ended September 30, 2003

[   ] Transition Report under Section 13 or 15(d) of the Securities Exchange
      Act of 1934

                         Commission file number: 0-33411

                          NEW PEOPLES BANKSHARES, INC.
             (Exact Name of Registrant as Specified in its Charter)


                Virginia                               31-1804543
    (State or Other Jurisdiction of                 (I.R.S. Employer
     Incorporation or Organization)                Identification No.)


              2 Gent Drive
           Honaker, Virginia                              24260
(Address of Principal Executive Offices)               (Zip Code)

             Registrant's telephone number, including area code: (276) 873-6288


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

      Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
                                                       Yes            No   X
                                                           ------        ------

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

                6,903,003 shares of common stock, par value $2.00 per share,
                             outstanding as of November 1, 2003


<PAGE> 1

                         NEW PEOPLES BANKSHARES, INC.

                                     INDEX
                                                                        Page

PART I   FINANCIAL INFORMATION                                            2

Item 1.  Financial Statements

         Consolidated Statements of Income - Nine Months
         Ended September 30, 2003 and 2002 (Unaudited)                    2

         Consolidated Statements of Income - Three Months
         Ended September 30, 2003 and 2002 (Unaudited)                    3

         Consolidated Balance Sheets - September 30, 2003 and
         December 31, 2002 (Audited)                                      4

         Consolidated Statements of Changes in Stockholders' Equity -
         Nine Months Ended September 30, 2003 and 2002 (Unaudited)        5

         Consolidated Statements of Cash Flows - Nine Months
         Ended September 30, 2003 and 2002 (Unaudited)                    6

         Notes to Consolidated Financial Statements                       7

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

Item 3.  Quantitative and Qualitative Disclosures about Market Risk      19

Item 4.  Controls and Procedures                                         19


PART II  OTHER INFORMATION                                               20

Item 1.  Legal Proceedings                                               20

Item 2.  Changes in Securities and Use of Proceeds                       20

Item 3.  Defaults upon Senior Securities                                 20

Item 4.  Submission of Matters to a Vote of Security Holders             20

Item 5.  Other Information                                               21

Item 6.  Exhibits and Reports on Form 8-K                                21


         SIGNATURES                                                      22


<PAGE> 2

Part I  Financial Information
Item 1  Financial Statements

                         NEW PEOPLES BANKSHARES, INC.
                       CONSOLIDATED STATEMENTS OF INCOME
             FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)

                                                        2003        2002
Interest Income
   Loans including fees                            $14,142,734  $12,232,972
   Federal funds sold                                  150,745       99,781
   Investments                                         279,614      141,482
                                                    ----------   ----------

   Total Interest Income                            14,573,093   12,474,235
                                                    ----------   ----------

Interest Expense
   Interest on deposits                              4,873,684    4,568,583
                                                    ----------   ----------

Net Interest Income                                  9,699,409    7,905,652

Provision for Loan Losses                              364,000      476,000
                                                    ----------   ----------

Net Interest Income After Provision
  for Loan Losses                                    9,335,409    7,429,652
                                                   -----------  -----------

Noninterest Income
   Service charges                                     657,651      467,820
   Fees and commissions and other income               331,732      225,918
   Life insurance investment income                    315,214      341,488
                                                    ----------   ----------

Total Noninterest Income                             1,304,597    1,035,226
                                                    ----------  -----------

Noninterest Expense
   Salaries and employee benefits                    4,482,776    3,140,349
   Occupancy expense                                 1,274,677      796,333
   Other operating expenses                          1,916,936    1,822,759
                                                    ----------   ----------

   Total Noninterest Expenses                        7,674,389    5,759,441
                                                    ----------   ----------

Income Before Income Taxes                           2,965,617    2,705,437

Income Tax Expense                                   1,000,437      969,889
                                                    ----------  -----------

Net Income                                         $ 1,965,180  $ 1,735,548
                                                    ==========   ==========


Net Income Per Share
   Basic                                           $       .29  $       .29
                                                    ==========   ==========
   Diluted                                         $       .28  $       .29
                                                    ==========   ==========

Weighted Average Shares Outstanding
   Basic                                             6,867,047    6,000,000
   Diluted                                           6,936,384    6,067,209


       The accompanying notes are an integral part of these statements.


<PAGE> 3

Part I  Financial Information
Item 1  Financial Statements

                         NEW PEOPLES BANKSHARES, INC.
                       CONSOLIDATED STATEMENTS OF INCOME
            FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)

                                                       2003         2002
Interest Income
   Loans including fees                            $4,961,588   $ 4,286,177
   Federal funds sold                                  70,830        41,937
   Investments                                         69,707        50,330
                                                    ---------    ----------

   Total Interest Income                            5,102,125     4,378,444
                                                    ---------    ----------

Interest Expense
   Interest on deposits                             1,610,234     1,563,976
                                                    ---------    ----------

Net Interest Income                                 3,491,891     2,814,468

Provision for Loan Losses                              30,000       198,000
                                                    ---------    ----------

Net Interest Income After Provision for
  Loan Losses                                       3,461,891     2,616,468
                                                   ----------    ----------

Noninterest Income
   Service charges                                    261,176       176,989
   Fees and commissions and other income              144,513        77,163
   Life insurance investment income                    85,902       115,338
                                                    ---------    ----------

   Total Noninterest Income                           491,591       369,490
                                                    ---------    ----------

Noninterest Expense
   Salaries and employee benefits                   1,606,526     1,158,902
   Occupancy expense                                  455,745       298,950
   Other operating expenses                           735,967       666,518
                                                    ---------    ----------

   Total Noninterest Expenses                       2,798,238     2,124,370
                                                    ---------   -----------

Income Before Income Taxes                          1,155,244       861,588

Income Tax Expense                                    394,523       322,242
                                                    ---------    ----------

Net Income                                         $  760,721   $   539,346
                                                    =========    ==========

Net Income Per Share
   Basic                                           $       .11  $       .09
                                                    ==========   ==========
   Diluted                                         $       .11  $       .09
                                                    ==========   ==========

Weighted Average Shares Outstanding
   Basic                                             6,901,318    6,000,000
   Diluted                                           6,969,685    6,064,000


       The accompanying notes are an integral part of these statements.


<PAGE> 4

                         NEW PEOPLES BANKSHARES, INC.
                          CONSOLIDATED BALANCE SHEETS


                                                September 30,   December 31,
                                                    2003           2002
                                                 (Unaudited)     (Audited)
     ASSETS

Cash and due from banks                        $ 10,360,171    $  8,815,523
Federal funds sold                                5,526,000       6,123,000
                                                -----------     -----------

   Total Cash and Cash Equivalents               15,886,171      14,938,523

Securities held to maturity, fair value o
   $40,842,256 at September 30, 2003 and
   $34,356,811 at December 31, 2002              40,830,166      34,304,596
Loans, net of allowance for loan losses of
   $2,492,111 at September 30, 2003, and
   $2,224,487 at December 31, 2002              266,253,143     220,170,411
Bank premises and equipment, net                 13,233,003      10,915,165
Federal Reserve Bank and FHLB stock
  (restricted)                                    1,364,250         538,950
Accrued interest receivable                       2,037,280       1,846,231
Life insurance investments                        8,267,670       7,987,882
Other assets                                        800,622         696,555
                                                -----------     -----------

   Total Assets                                $348,672,305    $291,398,313
                                                ===========     ===========

     LIABILITIES

Deposits:
   Demand deposits:
     Noninterest bearing                       $ 31,448,169    $ 22,379,395
   Interest bearing                              18,165,540       9,711,423
   Savings deposits                              38,501,953      27,125,922
   Time deposits                                226,850,682     204,588,711
                                                -----------     -----------

   Total Deposits                               314,966,344     263,805,451

Accrued interest payable                            588,947         702,260
Accrued expenses and other liabilities            1,164,031         409,374
                                                -----------     -----------

   Total Liabilities                            316,719,322     264,917,085
                                                -----------     -----------

     STOCKHOLDERS' EQUITY

Common stock - $2 par value; 12,000,000
   shares authorized; 6,903,003 shares issued
   and outstanding                               13,806,006
   6,008,393 shares issued and outstanding                       12,016,786
Paid-in-surplus                                  13,076,760       5,948,505
Stock subscriptions                                               5,410,900
Retained earnings                                 5,070,217       3,105,037
                                                -----------     -----------

   Total Stockholders' Equity                    31,952,983      26,481,228
                                                -----------    ------------

   Total Liabilities and Stockholders' Equity  $348,672,305    $291,398,313
                                                ===========     ===========

       The accompanying notes are an integral part of these statements.


<PAGE> 5
<TABLE>

                         NEW PEOPLES BANKSHARES, INC.
          CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
             FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)

<CAPTION>


                              Common       Paid in          Stock       Retained
                               Stock       Surplus       Subscriptions  Earnings      Total

<S>                        <C>            <C>             <C>           <C>        <C>

Balance, December 31,
   2001                    $ 12,000,000   $  5,964,331    $             $926,743   $18,891,074

Net Income                                                             1,735,548     1,735,548
                            -----------   ------------    ----------   ---------     ---------

Balance September 30,
   2002                    $ 12,000,000   $  5,964,331   $            $2,662,291   $20,626,622
                            ===========      =========    ==========   =========    ==========


Balance, December 31,
   2002                    $ 12,016,786   $  5,948,505   $ 5,410,900  $3,105,037   $26,481,228

Common Stock Subscribed                                    3,435,200                 3,435,200

Stock Options Exercised          20,000         55,000                                  75,000

Common Stock Issued           1,769,220      7,076,880    (8,846,100)

Cost of Common Stock
   Offering                                     (3,625)                                 (3,625)

Net Income                                                             1,965,180     1,965,180
                            -----------     ----------   ----------    ---------     ---------

Balance September 30,
   2003                    $ 13,806,006   $ 13,076,760   $            $5,070,217   $31,952,983
                            ===========     ==========    =========    =========    ==========
</TABLE>


       The accompanying notes are an integral part of these statements.



<PAGE> 6

                         NEW PEOPLES BANKSHARES, INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


                                                     2003          2002

Operating Activities:
   Net income                                    $ 1,965,180    $ 1,735,548
   Adjustments to reconcile net income to net
     cash provided by operating activities:
       Provision for loan losses                     364,000        476,000
       Net amortization on securities                440,299
       Depreciation                                  805,872        624,282
       Income from life insurance contracts
         (net of expenses)                          (279,788)      (382,006)
       Net change in:
         Interest receivable                        (191,049)        31,614
         Other assets                               (104,067)       105,425
         Accrued interest, expenses and other
           liabilities                               641,345        (28,996)
                                                  ----------     ----------

   Net Cash Provided by Operating Activities       3,641,792      2,561,867
                                                  ----------    -----------

Investing Activities:
   Payments for the purchase of property          (3,123,710)    (2,387,743)
   Net change in loans                           (46,446,732)    33,903,362)
   Purchase of securities held to maturity       (65,964,158)
   Maturity of securities held to maturity        58,998,288
   Purchase of Federal Reserve Bank stock           (120,000)
   Purchase of FHLB stock                           (705,300)    11,205,166)
                                                  ----------     ----------

   Net Cash Used in Investing Activities          (57,361,612)  (47,496,271)
                                                  -----------    ----------


Financing Activities:
   Net change in:
     Demand and saving deposits                   28,898,922     13,913,733
     Time deposits                                22,261,971     35,888,519
   Net proceeds from common stock offering         3,431,575
   Common stock options exercised                     75,000
                                                  ----------    -----------

   Net Cash Provided by Financing Activities      54,667,468     49,802,252
                                                  ----------     ----------

Net Increase (Decrease) in Cash and Cash
   Equivalents                                       947,648      4,867,848

Cash and Cash Equivalents, Beginning of Period    14,938,523     11,547,163
                                                  ----------     ----------

Cash and Cash Equivalents, End of Period         $15,886,171    $16,415,011
                                                  ==========     ==========

Supplemental Disclosure of Cash Paid:
   Interest                                       $4,986,997    $ 4,629,444
   Income Taxes                                   $  755,000    $   969,889

       The accompanying notes are an integral part of these statements.


<PAGE> 7

                         NEW PEOPLES BANKSHARES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1    ACCOUNTING PRINCIPLES:

             The financial statements conform to U.S. generally accepted
          accounting principles and to general industry practices. In the
          opinion of management, the accompanying unaudited financial statements
          contain all adjustments (consisting of only normal recurring accruals)
          necessary to present fairly the financial position as of September 30,
          2003, and the results of operations for the nine and three month
          periods ended September 30, 2003 and 2002. The notes included herein
          should be read in conjunction with the notes to financial statements
          included in the 2002 annual report to shareholders of New Peoples
          Bankshares, Inc. The results of operations for the nine and three
          month periods ended September 30, 2003 and 2002 are not necessarily
          indicative of the results to be expected for the full year.

             The Company does not expect the anticipated adoption of any newly
          issued accounting standards to have a material impact on future
          operations or financial position.


NOTE 2    SECURITIES HELD TO MATURITY:

             The amortized cost and estimated fair value of securities held to
          maturity are as follows:
                                             Gross       Gross
                            Amortized     Unrealized  Unrealized    Fair
                              Cost           Gains      Losses      Value
          September 30, 2003

          U.S. Government
             Agency        $ 40,728,743   $  14,500   $  7,311   $ 40,735,932
          State, County &
             Municipal          101,423       4,901                   106,324
                            -----------    --------    -------    -----------

          Total Securities Held
             To Maturity   $ 40,830,166   $  19,401   $  7,311   $ 40,842,256
                            ===========    ========    =======    ===========

          December 31, 2002

          U.S. Government
            Agency         $ 34,203,529   $  56,916   $ 10,613   $ 34,249,832
          State, County &
            Municipal           101,067       5,912                   106,979
                            -----------    --------    -------    -----------

          Total Securities Held
            to Maturity    $ 34,304,596   $  62,828   $ 10,613   $ 34,356,811
                            ===========    ========    =======    ===========


NOTE 3   LOANS:

            Loans receivable outstanding are summarized as follows: (Rounded to
         the nearest thousand.)
                                                September 30,  December 31,
                                                    2003           2002
                                                    ----           ----

         Commercial, financial
            and agricultural                   $120,088,000    $ 93,746,000
         Real estate -
            construction                          6,747,000       5,615,000
         Real estate mortgage -
            1-4 family residential               95,263,000      80,264,000
         Installment loans to
            individuals                          46,647,000      42,770,000
                                                -----------     -----------

            Loans Receivable                   $268,745,000    $222,395,000
                                                ===========     ===========


<PAGE> 8

                         NEW PEOPLES BANKSHARES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
<TABLE>


NOTE 4    ALLOWANCE FOR LOAN LOSSES:

          Transactions in the Company's allowance for loan losses are shown in
          the following schedule:

<CAPTION>
                             For the Three Months Ended   For the Nine Months Ended
                              September 30,  September 30,  September 30,  September 30,
                                  2003          2002            2003          2002
                                ---------    ----------       --------      --------
          <S>                    <C>          <C>            <C>          <C>

          Balance, beginning
             of period           $2,509,919   $2,026,128     $2,224,487   $1,792,850
          Provision for loan
          losses                    30,000       198,000        364,000      476,000
          Charge-offs              (49,906)     (100,223)      (113,542)    (172,001)
          Recoveries                 2,098         5,899         17,166       32,955
                                  --------     ---------      ---------     --------

          Balance, End of
          Period                $2,492,111   $2,129,804     $2,492,111    $2,129,804
                                 =========    =========      =========    =========
</TABLE>


NOTE 5    COMMON STOCK:

             Beginning October 15, 2002, 1,200,000 shares of common stock were
         offered for sale by means of a prospectus to existing shareholders and
         to the general public in the states of Virginia, West Virginia and
         Tennessee only. The sale ended on February 7, 2003, after one 30 day
         extension from the original sale period. The total number of shares
         sold under the offering were 890,469 resulting in total gross proceeds
         to the Company of $8,904,690.



NOTE 6    STOCK OPTION PLAN:

             The Company has a stock-based compensation plan under which the
         Company can issue options, up to a maximum of 900,000 shares, to
         directors and employees to purchase common stock. Under the Plan, the
         exercise price may not be less than 100% of the fair market value of
         the shares on the award date. The options become vested and exercisable
         on the date of the grant. The stock option plan is more fully described
         in note 13 to the December 31, 2002 consolidated financial statements.

             The Company awarded options to acquire 286,000 shares on December
         12, 2001 and 79,500 shares on January 1, 2003. The options expire ten
         years from the date of the award. The fair value of each option granted
         on January 1, 2003, was $3.30 using the Black Scholes Option Pricing
         method with the following assumptions: risk free interest rate - 4.01%,
         expected life - 10 years, expected volatility - zero and expected
         dividends - zero.

             Outstanding options as of September 30, 2003 are as follows:

                                     Exercise
              Date of Grant            Price       Outstanding

             December 12, 2001         7.50         273,466
             January 1, 2003          10.00          79,500


<PAGE> 9

                         NEW PEOPLES BANKSHARES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 6    STOCK OPTION PLAN (CONTINUED):

             The Company accounts for the plan under the recognition and
         measurement principles of APB No. 25, Accounting for Stock Issued to
         Employees, and related Interpretations. No Stock-based employee
         compensation cost is reflected in net income, as all options granted
         under the plan had an exercise price equal to the market value of the
         underlying common stock on the date of grant. The following table
         illustrates the effect on net income and earnings per share as if the
         Company had applied the fair value recognition provisions of FASB
         Statement No. 123, Accounting for Stock-Based Compensation, to the
         stock option plan. No compensation cost would be recognized under FASB
         Statement No. 123 during the year 2002.

                           Three Months Ended          Nine Months Ended
                         September 30,September 30,September 30,September 30,
                             2003        2002          2003        2002
                             ----        ----          ----        ----

Net income, as reported   $ 760,721   $ 539,346      $1,965,180  $1,735,548
Deduct: Total stock-based
  employee compensation
  expense determined under
  fair value based method                             (262,350)
                           --------    --------       --------    --------

Pro Forma Net Income      $ 760,721   $ 539,346      $1,702,830  $1,735,548
                           ========    ========       =========   =========

Net Income per Share:

Basic

  As reported             $      .11  $     .09      $     .29   $     .29
                           =========   ========       ========    ========
  Proforma                $      .11  $     .09      $     .25   $     .29
                           =========   ========       ========    ========

Diluted

  As reported             $      .11  $     .09      $     .28   $     .29
                           =========   ========       ========    ========
  Proforma                $      .11  $     .09      $     .25   $     .29
                           =========   ========       ========    ========


NOTE 7    EARNINGS PER SHARE:

             Diluted earnings per share have been calculated to reflect the
         dilutive effect of the exercisable outstanding options granted to
         employees and directors of the Company. The dilution calculation
         assumes that all options were exercised at the beginning of the period
         and that the proceeds were used to purchase common stock at the average
         market price during the period.


<PAGE> 10

                         NEW PEOPLES BANKSHARES, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 8   RECENT ACCOUNTING PRONOUNCEMENTS:

             In December 2002, the FASB issued FAS 148, "Accounting for
         Stock-Based Compensation." This new standard provides alternative
         methods of transition for a voluntary change to the fair value method
         of accounting for stock-based compensation. In addition, the Statement
         amends the disclosure requirements of FAS 123 to require prominent
         disclosure in both annual and interim financial statements about the
         method of accounting for stock-based compensation and the underlying
         effect of the method used on reported results until exercised. The
         Company plans to continue to use the intrinsic value method in
         accordance with APB 25. The disclosures required by FAS 148 are shown
         above in Note 6.

             In April 2003, FASB issued FAS 149, "Amendment of Statement 133 on
         Derivative Instruments and Hedging Activities." This new standard
         amends and clarifies financial accounting and reporting for derivative
         instruments, including certain derivative instruments embedded in other
         contracts (collectively referred to as derivatives) and for hedging
         activities FAS 133, "Accounting for Derivative Instruments and Hedging
         Activities." The statement is effective for contracts entered into or
         modified after June 30, 2003. Adoption of this statement is not
         expected to have a material effect on the Company.

             In April 2003, FASB issued FAS 150, "Accounting for Certain
         Financial Instruments with Characteristics of both Liabilities and
         Equity." This new statement establishes standards for how an issuer
         classifies and measures certain financial instruments with
         characteristics of both liabilities and equity. It requires that an
         issuer classify a financial instrument that is (1) issued in the form
         of shares that is mandatorily redeemable, (2) at inception embodies an
         obligation to repurchase the issuer's equity, or is indexed to such an
         obligation, and that requires or may require the issuer to settle the
         obligation by transferring assets, or (3) embodies an unconditional
         obligation, or a financial instrument other than an outstanding share
         that embodies a conditional obligation, that the issuer must or may
         settle by issuing a variable number of its equity shares provided
         certain conditions are met; as a liability (or asset in some
         circumstances). FAS 150 is effective for financial instruments entered
         into or modified after May 31, 2003, and otherwise is effective at the
         beginning of the first interim period beginning after June 15, 2003.
         Adoption of this statement is not expected to have a material effect on
         the Company.


<PAGE> 11

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


Forward Looking Statements

      The following discussion contains statements that refer to future
expectations, contain projections of the results of operations or of financial
condition or state other information that is "forward-looking."
"Forward-looking" statements are easily identified by the use of words such as
"could," "could anticipate," "estimate," "believe," and similar words that refer
to the future outlook. There is always a degree of uncertainty associated with
"forward-looking" statements. The Company's management believes that the
expectations reflected in such statements are based upon reasonable assumptions
and on the facts and circumstances existing at the time of these disclosures.
Actual results could differ significantly from those anticipated.

      Many factors could cause the Company's actual results to differ materially
from the results contemplated by the forward-looking statements. Some factors,
which could negatively affect the results, include:

      o     General economic conditions,  either nationally or within the
            Company's markets, could be less favorable than expected;
      o     Changes in market interest rates could affect interest margins and
            profitability;
      o     Competitive pressures could be greater than anticipated; and
      o     Legal or accounting changes could affect the Company's results.

Overview

     New Peoples  Bankshares Inc.  ("Company") is a financial  holding
 company,  which owns 100% of New  Peoples  Bank,  Inc.  ("Bank").  In May of
2003;  the  Company  formed  two new subsidiaries:  NPB Financial  Services,
Inc.,  which will provide  insurance and investment products,  and NPB  Web
Services,  Inc.,  which  will  provide  Web  site  development  and
maintenance  for  customers of the Bank.  We  anticipate  that the new
entities  will begin operations during 2003.

     The Bank opened for business on October 28, 1998 and has achieved
outstanding growth. As of September 30, 2003, the Bank had total deposits of
$314,966,344 and total loans of $268,745,254.

     Our net income for the nine months ended September 30, 2003 was $1,965,180
compared with net income of $1,735,548 for the nine months ended September 30,
2002. Net income per share was $.29 compared with $.29 for the prior period.

     Our net income for the quarter ended September 30, 2003 was $760,721
compared with $593,101 for the second quarter of 2003 and $539,346 for the
quarter ended September 30, 2002. The increase in net income is mainly
attributed to the decrease in our provision for loan losses. Net income per
share was $.11 compared with $.09 for the second quarter of 2003 and $.09 for
the quarter ended September 30, 2002.

     For the foreseeable future, management will continue its strategy of
providing personal and customized financial services to individuals, small to
medium size businesses and the professional community. The Bank will strive to
serve the banking needs of its customers by developing personal, hometown
relationships.

Net Interest Income and Net Interest Margin

     Our net interest income, which equals total interest and dividend income
less total interest expense, increased from $7,429,652 for the first nine months
of 2002 to $9,335,409 for the first nine months of 2003. The increase was the
net result of higher average balances and a 60 basis point decrease in the net
interest margin.


<PAGE> 12

Net Interest Income and Net Interest Margin (Continued)

     The net interest margin on earning assets, which equals net interest income
divided by total interest earning assets was 4.49% for the first nine months of
2003 and 5.09% for the first nine months of 2002. Interest rates were lower
during the first nine months of 2003 compared with the same period in 2002 in
response to interest rate cuts by the Federal Reserve Bank. The average yield on
earning assets decreased 126 basis points and the average cost of funds
decreased 66 basis points resulting in the decrease in the net interest margin.
Because of a strong loan demand, the Bank was able to maintain the yield on
loans at 7.78% during the current period compared with 8.33% for the prior
period. The Bank continues to offer attractive loan and deposit rates in order
to attract new customers. Table I below shows the rates paid on earning assets
and deposit liabilities.

     The net interest margin for the third quarter of 2003 was 4.57% compared
with 5.09 % for the third quarter of 2002. The trend in interest rates during
the third quarter of 2003 was consistent with the decreases experienced during
the first half of 2003.

Provision for Loan Losses

     The provision for loan losses for the first nine months of 2003 was
$364,000 compared with $476,000 for the same period of 2002. Loan charge-offs
for the first nine months of 2003 were $113,542 and recoveries were $17,166
resulting in an allowance for loan losses of $2,492,111 at September 30, 2003
(approximately .93% of total loans).

     Our provision for loan losses for the third quarter of 2003 was $30,000
compared to $198,000 for the third quarter of 2002. Net loan charge-offs for the
third quarter of 2003 were $47,808. Based on our loan loss experience to date
and the low amount of problem loans, we have reduced our provision for loan
losses for the quarter ended September 30, 2003.

     The calculation of the allowance for loan losses is considered a critical
accounting policy. Although we have experienced lenders who are familiar with
their customer base, most loans are too new to have exhibited signs of weakness
and the bank does not have an adequate history of loan losses to develop
accurate risk factors. Prior to the current quarter, we used guidelines that
have been traditionally recommended by the bank regulatory agencies for
calculating the amount of the allowance for loan losses. At each balance sheet
date, we adjusted the allowance to equal the larger of 1% or an amount
calculated by multiplying a loss factor times the amount of loans in each risk
classification pool. The pools and loss factors used in this calculation are as
follows: loss-100%, doubtful-50%, substandard-10%, special mention-1%, pass-.5%.
In addition we consider current economic conditions, changes in the nature and
volume of the loan portfolio, and known adverse factors that may affect the
borrower's ability to repay.

     Loan officers initially risk rate the loans and a loan processor reviews
the risk rating for appropriateness. In addition, a credit analyst reviews all
loans in excess of $500,000 to one borrower. We also have a loan review team
that reviews a sample of new loans for compliance, collectibility and risk
rating. On a continuous basis, we downgrade loans if necessary based on
recommendations of loan officers, review of past due loans, and recommendations
of examiners and auditors.

     We are in the process of developing a methodology to calculate the
allowance for loan losses which will reflect our loss experience and the
existing risks in our loan portfolio.

     The allowance for loan losses represents management's best estimate of the
probable loan losses incurred as of each balance sheet date.


<PAGE> 13

Noninterest Income

     Noninterest income increased from $1,035,226 in the first nine months of
2002 to $1,304,597 in the first nine months of 2003. The increase in service
charges, fees and commissions is consistent with the growth in average assets of
the Bank. Noninterest income as a percentage (annualized) of average assets was
..55% for the first nine months of 2003 compared to .59% for the first nine
months of 2002.

     Noninterest income increased from $369,490 in the third quarter of 2002 to
$491,591 for the third quarter of 2003. The increase in service charges, fees
and commissions is consistent with the growth in average assets of the Bank.
Noninterest income as a percentage (annualized) of average assets was .57 % for
the third quarter of 2003 compared with .60% for the third quarter of 2002.

Noninterest Expense

     Noninterest expense increased from $5,759,441 in the first nine months of
2002 to $7,674,389 in the first nine months of 2003. The increase was due to
additional staffing and expenses associated with the new branches opened and the
general growth in operations. Noninterest expense as a percentage (annualized)
of average assets was 3.21% for the first nine months of 2003 compared to 3.30%
for the first nine months of 2002.

     Noninterest expense increased from $2,124,370 in the third quarter of 2002
to $2,798,238 for the third quarter of 2003. Noninterest expense as a percentage
(annualized) of average assets was 3.27% for the third quarter of 2003 compared
with 3.42% for the third quarter of 2002.

Investment Securities

    Total investment securities increased from $34,304,596 at December 31, 2002
to $40,830,166 at September 30, 2003. We had no Available For Sale securities at
September 30, 2003 and December 31, 2002. At those dates, we believed that we
had adequate liquidity in the form of other assets, including federal funds
sold. In addition, the Securities Held to Maturity held at those dates generally
had short contractual maturities and would have been available for liquidity
purposes if necessary. See additional discussion of liquidity below.

    Our practice has been to invest available funds in short term U.S. Treasury
and Agency securities, which reduce the percentage of the bank's capital that is
subject to the Virginia bank franchise tax. The amount invested fluctuates from
period to period depending on the funds available and projected liquidity needs.
During the first nine months of 2003, Securities Held to Maturity with a face
value of $58,998,288 were replaced with similar short-term Securities Held to
Maturity.

Loans

    Total loans have increased $46,350,000 during the first nine months of 2003
to $268,745,000 due to strong loan demand and customers at our new branches.
Approximately 68% of the loan portfolio is secured by real estate.

    Loans receivable outstanding are summarized as follows:

                                 Loan Portfolio
                                 (In Thousands)
                                                   September 30, December 31,
                                                       2003         2002

    Commercial, financial and agricultural         $  120,088    $   93,746
    Real estate - construction                          6,747         5,615
    Real estate mortgage - 1-4 family residential      95,263        80,264
    Installment loans to individuals                   46,647        42,770
                                                    ---------     ---------

            Loans Receivable                       $  268,745    $  222,395
                                                    =========     =========


<PAGE> 14

Loan Portfolio Risks

    Nonaccrual and past due loans are shown in the following schedule.
Management has not identified any additional loans as "troubled debt
restructurings" or "potential problem loans."

                                              September 30, December 31,
                                                  2003          2002
    Principal:                                      (In Thousands)
      Nonaccrual and past due loans:
        Nonaccruing loans                      $     154    $      40
        Loans past due 90 days or more
           and still accruing                         70           19
                                                --------     --------

      Total                                    $     224    $      59
                                                ========     ========

    Percent of total loans                           .08%         0.03%

Investment in Federal Home Loan Bank of Atlanta

    During 2003, the Bank purchased common stock issued by the Federal Home Loan
Bank of Atlanta ("FHLB") of $705,300. The Bank also entered into an agreement
with the FHLB which establishes a $49,000,000 line of credit. Advances under the
line will be secured by a blanket floating lien on the Bank's qualifying real
estate loans. No advances had been made under the line of credit at September
30, 2003.

Bank Premises

    At September 30, 2003, we had thirteen full service branches, two
deposit-taking branches and two loan production offices.

    On July 2, 2003, we opened a branch in Dungannon, Virginia, in leased
facilities located within the building which houses the Dungannon Post Office.
The monthly lease fee will be approximately $800. It will be operated primarily
as a deposit-taking branch, with two tellers.

    On September 18, 2003 we opened a full-service branch in Kingsport,
Tennessee. The Bank is a 3,600 square foot two story brick building situated on
a one-acre lot. It contains three drive-thru lanes and an ATM. The branch is
located at 2600 North John B. Dennis Highway, Kingsport, Tennessee 37660.

    We have signed a three year lease, at $2,200/month, with Helms Candy Company
for a facility at 2975 Lee Highway, Bristol, Virginia to establish a branch.
Approval was granted by the SCC on October 6, 2003. The building, which measures
13'6" x 76'6" is a converted trailer which formerly housed a banking office.
After some renovations and remodeling, we hope to open for business before the
end of 2003.

    Property has been purchased at 350 West Main Street in Abingdon, Virginia
for the construction of a full service branch. Purchase price of the property,
formerly housing a Radio Shack, which will require extensive remodeling, was
$500,000; plus another $210,000 for the adjacent property which will be
converted into parking areas. Cost of the remodeling and furnishing of the site
is anticipated to be approximately $500,000. Opening is projected for 2004.

    Construction has begun behind the Main Office in Honaker for a new
Operations Building. The two story building will house Data Processing,
Operations, Accounting, and Bookkeeping. The cost of the land was $75,000; $1.5
million is the projection for the finished facility. Spring 2004 is the
anticipated completion date.


<PAGE> 15

Bank Premises (Continued)

    We will continue to investigate and consider other possible sites that would
enable the Bank to profitably serve its chosen market area. Additional purchases
of premises and equipment for the year 2003 will depend on the decision to open
additional branches.

Deposits

    Our deposits increased $51,160,893 during the first nine months of 2003 to
$314,966,344 at September 30, 2003 due to customers at our new branches. A
schedule of deposits by type is shown in the balance sheet. Time deposits of
$100,000 or more equaled 19.6% of total deposits at September 30, 2003 and 20.0%
at December 31, 2002. We do not have brokered deposits and internet accounts are
limited to customers in the surrounding geographical area. A maturity schedule
of deposits is included in Table II below.

Capital

    Capital as a percentage of total assets was 9.16% at September 30, 2003,
which exceeded regulatory requirements.

    Beginning October 15, 2002, 1,200,000 shares of common stock were offered
for sale by means of a prospectus to existing shareholders and to the general
public in the states of Virginia, West Virginia and Tennessee only. The sale
ended on February 7, 2003, after one 30 day extension from the original sale
period. The total number of shares sold under the offering were 890,469,
resulting in total gross proceeds of $8,904,690.

Liquidity

    We had liquid assets of approximately $55.9 million at September 30, 2003 in
the form of cash and due from banks, federal funds sold and investments maturing
within 90 days. We believe that our liquid assets were adequate at September 30,
2003. In the event that we need additional funds, we have the ability to
purchase federal funds under established lines of credit of $3.5 million and to
borrow from the FHLB under a $49 million line of credit. Additional liquidity
will be provided by the future growth that management expects in deposit
accounts and loan repayments. We believe that this future growth will result
from an increase in market share in our targeted trade area. The maturity of our
interest earning assets and interest bearing deposits is shown in Table II
below.

Employees

    The Company's full time equivalent employees have increased from 145 at
December 31, 2002 to 180 at September 30, 2003. Future increases in the number
of employees will depend on the selection and approval of new branches.


<PAGE> 16
Table I
<TABLE>
                          NEW PEOPLES BANKSHARES, INC.
                          NET INTEREST MARGIN ANALYSIS
                              AVERAGE BALANCE SHEET
                   FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
                            (In thousands of dollars)

<CAPTION>

                              ---------------2003 ---------------------------- 2002-------------
                               Average                  Average    Average               Average
                               Balance      Income/      Rates     Balance    Income/     Rates
                                Sheet       Expense   Earned/Paid   Sheet     Expense  Earned/Paid

<S>                            <C>         <C>           <C>       <C>        <C>         <C>
ASSETS
   Loans including fees (1)    $244,679    $ 14,143      7.78%     $195,878   $ 12,233    8.33%
   Federal Funds sold            19,810         151      1.02%        7,906        100    1.69%
   Other investments             24,847         279      1.50%        3,319        141    5.66%
                                -------    --------     -----       -------

   Total Earning Assets         289,336      14,573      6.77%     $207,103     12,474    8.03%
                                            -------                            -------

   Allowance for loans losses    (2,411)                             (1,947)
   Non-earning assets            31,401                              27,308
                                -------                             -------

   Total Assets                $318,326                            $232,464
                                =======                             =======

LIABILITIES AND STOCKHOLDERS' EQUITY

   Deposits
     Demand - Interest
        bearing                $ 19,106     $  146        1.02%    $ 12,877    $  145    1.50%
     Savings                     26,318        279        1.42%      18,049       268    1.98%
     All other time deposits    213,464      4,449        2.79%     160,893     4,155    3.44%
                               ---------   -------                 --------     -----


     Total Deposits             258,888     4,874         2.52%     191,819     4,568    3.18%
                                           ------                               -----

Non-interest bearing deposits    33,006                              19,471
   Other liabilities              1,404                               1,254
                                -------                             -------

     Total Liabilities          293,298                             212,544
   Stockholders' Equity          25,028                              19,920
                                -------                             -------

   Total Liabilities and
     Stockholders' Equity      $318,326                            $232,464
                                =======                             =======

   Net Interest Earnings                 $  9,699                             $ 7,906
                                          =======                             =======

   Net Yield on Interest
     Earning Assets                                      4.49%                          5.09%
                                                         ====                           ====


</TABLE>

(1) Nontaxable interest income is insignificant and treated as taxable in the
above analysis.


<PAGE> 17
Table I
<TABLE>
                          NEW PEOPLES BANKSHARES, INC.
                          NET INTEREST MARGIN ANALYSIS
                              AVERAGE BALANCE SHEET
                   FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
                            (In thousands of dollars)
<CAPTION>
                                ---------------- 2003 -------------------------------- 2002 ----------------
                                   Average                 Average          Average               Average
                                   Balance      Income/     Rates          Balance     Income/     Rates
                                    Sheet      Expense    Earned/Paid       Sheet     Expense    Earned/Paid

<S>                                <C>           <C>         <C>           <C>         <C>          <C>
ASSETS
   Loans including fees (1)        $259,535      $4,961      7.89%         $207,422    $  4,286     8.27%
   Federal Funds sold                30,814          71       .93%            9,978          42     1.68%
   Other investments                 21,457          70      1.31%            3,817          50     5.24%
                                    -------     -------                     -------     -------

   Total Earning Assets             311,806       5,102      6.73%          221,217       4,378     7.92%
                                      -------                              -------

   Allowance for loans losses        (2,513)                                 (2,061)
   Non-earning assets                32,903                                  28,958
                                    -------                                 -------

   Total Assets                    $342,196                                $248,114
                                    =======                                 =======

LIABILITIES AND STOCKHOLDERS' EQUITY

   Deposits
     Demand - Interest bearing    $ 23,873      $    50       .85%         $ 13,439    $   52      1.55%
     Savings                        29,150           93      1.28%           19,617        98      2.00%
     All other time deposits       225,391        1,467      2.64%          171,663     1,414      3.29%
                                   -------      -------      ----           -------     -----      ----

     Total Deposits                278,414        1,610      2.34%          204,719     1,564      3.06%
                                  --------                                  -------

Non-interest bearing deposits       35,354                                   21,755
   Other liabilities                 1,550                                    1,136
                                   -------                                  -------

     Total Liabilities             315,318                                  227,610

   Stockholders' Equity             26,878                                   20,504
                                   -------                                  -------

   Total Liabilities and
     Stockholders' Equity        $342,196                                  $248,114
                                  =======                                   =======

   Net Interest Earnings                      $  3,492                              $  2,814
                                               =======                               =======

   Net Yield on Interest
     Earning Assets                                         4.57%                                 5.09%
                                                           =====                                  ====

</TABLE>
(1) Nontaxable interest income is insignificant and treated as taxable in the
above analysis.


<PAGE> 18
Table II
<TABLE>

                          NEW PEOPLES BANKSHARES, INC.
                          INTEREST SENSITIVITY ANALYSIS
                           (In thousands of dollars)


<CAPTION>

September 30, 2003

                            1-90     91-365                                               Over 5
Uses of Funds               Days      Days      2005        2006        2007     2008      Years         Total
-------------               ----      ----      ----        ----        ----     ----      -----         -----

<S>                      <C>         <C>       <C>         <C>        <C>        <C>       <c>         <c>
Loans                    $  47,587   $98,231   $52,325     $32,154    $21,937    $7,555    $8,956      $268,745
Federal funds sold           5,526                                                                        5,526
Total investments           41,388                 807                                                   42,195
                            ------   -------    ------      ------     ------     -----     -----        ------

   Total                    94,501    98,231    53,132      32,154     21,937     7,555     8,956       316,466
                            ------   -------    ------      ------     ------     -----     -----       -------
Sources of Funds

Deposits

   Demand and savings       56,641                                                                       56,641
   Time deposits > $100M    53,337   77,027    14,772      10,527      7,813      1,821        14       165,311
   Time deposits < $100M    19,856   27,486     7,263       4,518      1,925        518                  61,566
                           -------   ------     -----       -----      -----      -----     -----        ------

   Total Deposits          129,834  104,513    22,035      15,045      9,738      2,339        14       283,518
                           -------  -------    ------    --------      -----      -----     -----       -------


Discrete Gap               (35,333)  (6,282)   31,097      17,109     12,199     5,216      8,942        32,948

Cumulative Gap             (35,333) (41,615)  (10,518)      6,591     18,790     24,006    32,948


Ratio of Cumulative Gap     -11.16%  -13.15%    -3.32%       2.08%      5.94%      7.59%    10.41%

  To Total Earning Assets

December 31, 2002

Ratio of Cumulative Gap
  To Total Earning Assets   -25.51%  -34.27%   -28.15%     -22.09%    -17.13%     -5.98%      8.33%
</TABLE>




Table II reflects the earlier of the maturity or repricing dates for various
assets and liabilities at September 30, 2003. In preparing the above table, no
assumptions are made with respect to loan prepayments or deposit run offs. Loan
principal payments are included in the earliest period in which the loan matures
or can be repriced. Principal payments on installment loans scheduled prior to
maturity are included in the period of maturity or repricing.


<PAGE> 19


Item 3.  Quantitative and Qualitative Disclosures About Market Risk

Interest rate risk represents the primary risk factor affecting our balance
sheet and net interest margin. Significant changes in interest rates by the
Federal Reserve could result in similar changes in other interest rates, that
could affect interest earned on our loan and investment portfolios and interest
paid on our deposit accounts.

Our policy objective is to monitor our position and to manage our short term and
long-term interest rate risk exposure. Our board of directors has established
percentages for the maximum potential reductions in net interest income, that we
are willing to accept, which result from changes in interest rates over the next
12-month period. The percentage limitations relate to instantaneous and
sustained changes in interest rates of plus and minus certain basis points.

The following table summarizes our established percentage limitations and the
sensitivity of our net interest income to various interest rate scenarios for
the next 12 months, based on assets and liabilities as of September 30, 2003 and
December 31, 2002. At both dates, our interest rate risk is within the
established limitations.
          Immediate      Estimated Increase
     Basis Point Change   (Decrease) in Net      Established
      In Interest Rates    Interest Income       Limitation

                     September 30, December 31,
                         2003         2002

             +300        4.36%       (4.67)%       (20.00)%
             +200        2.61        (3.10)        (15.00)
             +100        1.30        (1.55)         (7.00)
             -100       -1.33         2.13          (7.00)
             -200       -3.64         4.09         (15.00)
             -300      -10.58         1.95         (20.00)

    During the first nine months of 2003, we were able to reduce our interest
rate risk for an increasing rate environment by increasing our earning assets
that reprice within one year relative to deposits that will reprice within one
year.

    At September 30, 2003, we had a cumulative Gap Rate Sensitivity Ratio (based
on contractual terms) of a negative 13.15% for the one year repricing period
compared with a negative 34.27% at December 31, 2002. Management constantly
monitors the Company's interest rate risk and has decided that the current
position is an acceptable risk for a growing community bank operating in a rural
environment. Table II in Item 2 above shows the Company's interest sensitivity
by year.

Item 4.  Controls and Procedures

Evaluation of Disclosure Controls and Procedures

    As a result of the enactment of the Sarbanes-Oxley Act of 2002, issuers such
as the Company that file periodic reports under the Securities Exchange Act of
1934 (the "Act") are now required to include in those reports certain
information concerning the issuer's controls and procedures for complying with
the disclosure requirements of the federal securities laws. These disclosure
controls and procedures include, without limitation, controls and procedures
designed to ensure that information required to be disclosed by an issuer in the
reports it files or submits under the Act is communicated to the issuer's
management, including its principal executive officer or officers and principal
financial officer or officers, or persons performing similar functions, as
appropriate to allow timely decisions regarding required disclosure.


<PAGE> 20


Item 4.  Controls and Procedures (Continued)

    We have established our disclosure controls and procedures to ensure that
material information related to the Company is made known to our principal
executive officers and principal financial officer on a regular basis, in
particular during the periods in which our quarterly and annual reports are
being prepared. These disclosure controls and procedures consist principally of
communications between and among the Chief Executive Officer and the Chief
Financial Officer, and the other executive officers of the Company and its
subsidiaries to identify any new transactions, events, trends, contingencies or
other matters that may be material to the Company's operations. As required, we
will evaluate the effectiveness of these disclosure controls and procedures on a
quarterly basis, and most recently did so as of the end of the period covered by
this report.

Changes in Internal Controls

    We also maintain a system of internal accounting controls that is designed
to provide assurance that assets are safeguarded and that transactions are
executed in accordance with management's authorization and properly recorded.
This system is continually reviewed and is augmented by written policies and
procedures, and careful selection and training of qualified personnel. There
have been no significant changes to this system of internal controls or in other
factors that could materially affect those controls subsequent to the date of
the Company's evaluation described above.


Part II Other Information

Item 1. Legal Proceedings -            None

Item 2. Changes in Securities and Use of Proceeds - None

Item 3. Defaults Upon Senior Securities - None

Item 4. Submission of Matters to a Vote
        of Security Holders - The annual meeting of New Peoples Bankshares,
                              Inc. was held on October  16, 2003 at which  the
                              following  directors  were elected  for terms of
                              three  years each  expiring  at the 2006 annual
                              meeting of  shareholders:  Joe M. Carter,  Harold
                              Lynn Keene, John D. Maxfield,  Fred W. Meade and
                              E. Virgil Sampson, Jr.

                                    Voted for           3,564,565
                                    Voted against           4,400
                                    Abstention                  0

                              The terms of the following Directors continued
                              after the annual meeting.

                              Class II - Term Ending as of the 2004 Annual
                                         Meeting

                                    Tim Ball
                                    Michael G. McGlothlin
                                    Bill Ed Sample
                                    Paul Vencill, Jr.
                                    B. Scott White

                              Class III - Term Ending as of the 2005 Annual
                                          Meeting

                                    John D. Cox
                                    Charles H. Gent
                                    Frank Kilgore
                                    Stephen H. Starnes


<PAGE> 21


Item 5. Other Information -  None

Item 6. Exhibits and Reports on 8-K -

(a)   Exhibits

The following exhibits are filed as part of this Form 10-Q, and this list
includes the exhibit index:


No.                      Description

3.1     Articles of Incorporation of Registrant (1)

3.2     By Laws of Registrant (1)

31.1    Certification of Chief Executive Officer pursuant to Rule 13a-14(a)
        (filed herewith).

31.2    Certification of Chief Financial Officer pursuant to Rule 13a-14(a)
        (filed herewith).

32.1    Certifications of Chief Executive Officer and Chief Financial Officer
        pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
        of the Sarbanes-Oxley Act of 2002 (filed herewith).

        (1) Incorporated by reference to Exhibits to Form 8K filed by New
            Peoples Bankshares, Inc. on December 12, 2002

(b) Reports on Form 8-K.

     None


<PAGE> 22

                                    Signature



    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.

                                    NEW PEOPLES BANKSHARES, INC.


                                    By: /s/ KENNETH D. HART
                                        -------------------------------------
                                        Kenneth D. Hart
                                        President and Chief Executive Officer



                                    By:  /s/ FRANK SEXTON, JR.
                                         ------------------------------------
                                         Frank Sexton, Jr.
                                         Executive Vice President and Cashier


Date:  November 12, 2003