U.S. SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                           ---------------------------

                                   FORM 10-QSB

              [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                       SECURITIES EXCHANGE ACT OF 1934

                       For the quarterly period ended December 31, 1998

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

                  For the transition period from __________ to __________

                         Commission File Number 0-24476
                                                -------


                    SOUTH CAROLINA COMMUNITY BANCSHARES, INC.
                    -----------------------------------------
             (Exact name of Registrant as specified in its Charter)


        Delaware                                     57-0999615
-------------------------------       --------------------------------------
(State or other jurisdiction of       (I.R.S. Employer Identification Number)
incorporation or organization)
             



110 S. Congress Street, Winnsboro, South Carolina               29180
-------------------------------------------------               -----
   (Address of principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code: (803) 635-5536
                                                    --------------

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the  Securities  Exchange Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                 X  Yes       No
               ----      ----

     As of December 31,  1998,  there were  578,716  shares of the  Registrant's
common stock,  par value $0.01 per share,  outstanding.  The  Registrant  has no
other classes of common equity outstanding.

     Transitional small business disclosure format:

                    Yes    X  No
               ----      ----

                                        1


<PAGE>



                    SOUTH CAROLINA COMMUNITY BANCSHARES, INC.
                                 AND SUBSIDIARY


                            Winnsboro, South Carolina

                                      Index


PART I.                                                                  Page(s)

FINANCIAL INFORMATION

Item 1.
Financial Statements

Consolidated Balance Sheets (Unaudited) as of June 30, 1998,
  and December 31, 1998........................................................3

Consolidated Statements of Income  (Unaudited) for the three and six months
  ended December 31, 1997 and 1998.............................................4

Consolidated Statements of Stockholders' Equity (Unaudited)....................5

Consolidated Statements of Cash Flows  (Unaudited) for the six months
  ended December 31, 1997 and 1998...........................................6-7

Notes to (Unaudited) Consolidated Financial Statements.......................8-9

Item 2.
Management's Discussion and Analysis of Financial Condition
  and Results of Operations................................................10-13

PART II.

OTHER INFORMATION

Item 1.           Legal Proceedings...........................................14

Item 2.           Changes in Securities.......................................14

Item 3.           Defaults Upon Senior Securities.............................14

Item 4.           Submission of Matters to a Vote of Security Holders.........14

Item 5.           Other Information...........................................14

Item 6.           Exhibits and Reports on Form 8-K............................14

Signatures        ............................................................15



                                        2


<PAGE>






                                     SOUTH CAROLINA COMMUNITY BANCSHARES, INC.
                                                   AND SUBSIDIARY

                                             Consolidated Balance Sheets
                                                    (Unaudited)
                                          (in thousands, except share data)
<TABLE>
<CAPTION>


                                                                                     June 30,        December 31,
                                                                                  ---------------- -----------------
           Assets                                                                      1998              1998
                                                                                       ----              ----

<S>                                                                                   <C>              <C>     
Cash and due from banks                                                               $    578         $    214
Interest earning deposits                                                                8,100            3,905
Investment securities, held to maturity (market value of $1,871 and $2,126)              1,855            2,105
Investment securities, available for sale (amortized cost of $47 and $58)                   47               58
Loans receivable, net                                                                   36,007           37,930
Mortgage-backed securities, held to maturity (market value of $35 and $29)                  35               29
Premises and equipment, net                                                                547              518
Federal Home Loan Bank stock                                                               321              321
Interest receivable                                                                        301              326
Real estate                                                                                 71               71
Prepaid expenses and other assets                                                          130               93
                                                                                       -------          -------
         Total assets                                                                 $ 47,992         $ 45,570
                                                                                       =======          =======
   Liabilities and Stockholders' Equity

Deposits                                                                              $ 37,997         $ 35,538
Advance payments for taxes and insurance                                                    38               14
Accrued expenses and other liabilities                                                     361              337
Income taxes:
   Current                                                                                  58               38
   Deferred                                                                                124              124
                                                                                       -------          -------
         Total liabilities                                                              38,578           36,051
                                                                                       =======          =======

Stockholders' equity:
   Preferred stock ($.01 par value, 200,000
     shares authorized; none outstanding)                                                    -                -
   Common stock ($.01 par value, 1,400,000 shares authorized;
     780,275 shares issued; 579,664 outstanding at June 30, 1998,
     and 578,716 at December 31, 1998)                                                       8                8
   Paid in capital                                                                       7,389            7,405
   Retained earnings, substantially restricted                                           6,865            6,898
   Treasury stock, at cost (200,611 shares at June 30, 1998 and
     201,559 at December 31, 1998)                                                      (4,185)          (4,196)
   Unearned compensation:
     Employee Stock Ownership Plan                                                        (392)            (364)
     Management Recognition Plan                                                          (271)            (232)
                                                                                       -------          -------
         Total stockholders' equity                                                      9,414            9,519
                                                                                       -------          -------

         Total liabilities and stockholders' equity                                   $ 47,992         $ 45,570
                                                                                       =======          =======
</TABLE>

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.

                                                       3


<PAGE>




                                     SOUTH CAROLINA COMMUNITY BANCSHARES, INC.
                                                  AND SUBSIDIARY

                                         Consolidated Statements of Income
                                                    (Unaudited)
                                    (in thousands, except net income per share)



<TABLE>
<CAPTION>

                                                      For Three Months Ended              For Six Months Ended
                                                           December 31,                       December 31,
                                                   ------------------------------    -------------------------------
                                                        1997           1998               1997            1998
                                                        ----           ----               ----            ----
Interest income:
<S>                                                      <C>            <C>              <C>             <C>    
   Loans                                                 $ 748          $ 772            $ 1,508         $ 1,528
   Mortgage-backed securities                                1              -                  2               1
   Investments                                              74             43                128              89
   Interest earning deposits                                55             49                127             112
                                                      --------       --------           --------        --------
         Total interest income                             878            864              1,765           1,730

Interest expense:
   Deposits                                                434            426                849             855
                                                      --------       --------           --------        --------
         Net interest income                               444            438                916             875

Provision for loan losses                                    -              -                  -               -
                                                      --------       --------           --------        --------
         Net interest income after provision
           for loan losses                                 444            438                916             875
                                                      --------       --------           --------        --------

Noninterest income:
   Fees and services                                        12             14                 23              30
   Other                                                    13             14                 32              33
                                                      --------       --------           --------        --------
         Total noninterest income                           25             28                 55              63
                                                      --------       --------           --------        --------

Noninterest expenses:
   Compensation and employee benefits                      168            175                338             332
   Net occupancy expense                                    24             24                 46              51
   Deposit insurance premiums                                6              5                 11              11
   Data processing                                          19             17                 39              36
   Other                                                   129             83                213             152
                                                      --------       --------           --------        --------
         Total noninterest expenses                        346            304                647             582
                                                      --------       --------           --------        --------

         Income before income taxes                        123            162                324             356

Income tax expense                                          53             66                135             139
                                                      --------       --------           --------        --------

         Net income                                       $ 70            $ 96              $ 189           $ 217
                                                      ========        ========           ========        ========

Net income per common share:
   Basic                                                  $.12            $.18              $.30            $.40
   Diluted                                                $.12            $.18              $.30            $.39
                                                           ===             ===               ===             ===
Weighted average shares:
   Basic                                                   584             544               620             543
   Diluted                                                 604             546               639             553
</TABLE>

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.


                                                       4


<PAGE>




<TABLE>
<CAPTION>


                                             SOUTH CAROLINA COMMUNITY BANCSHARES, INC.
                                                           AND SUBSIDIARY

                                          Consolidated Statements of Stockholders' Equity
                                                            (Unaudited)
                                                 (in thousands, except share data)


                                              Common     Paid-In    Retained        Treasury  Unearned Compensation
                                                                                              ---------------------
                                               Stock     Capital    Earnings          Stock    for ESOP    for MRP          Total
                                               -----     -------    --------          -----    --------    -------          -----
<S>                                            <C>     <C>          <C>          <C>          <C>         <C>          <C>     
Balance at June 30, 1997                        $ 8     $ 7,321      $ 6,801      $ (1,352)    $ (452)     $ (364)      $ 11,962

Net income                                        -           -          408            -            -           -          408

Cash dividends declared ($.64 per share)          -           -         (344)           -            -           -         (344)

ESOP and MRP compensation earned                  -          70            -            -           60          93          223

Exercise of stock options (360 shares)            -          (2)           -            7            -           -            5

Treasury stock purchased (120,429 shares)         -           -            -       (2,840)           -           -       (2,840)
                                             ------      ------       ------       ------       ------      ------       ------

Balance at June 30, 1998                          8       7,389        6,865       (4,185)        (392)       (271)       9,414

Net income                                        -           -          217            -            -           -          217

Cash dividends declared ($.34 per share)          -           -         (198)           -            -           -         (198)

ESOP and MRP compensation earned                  -          20           14            -           28          39          101

Stock Options exercised (480 shares)              -          (4)           -           10            -           -            6

Treasury stock purchased (1,428 shares)           -           -            -          (21)           -           -          (21)
                                             ------      ------       ------       ------       ------      ------       ------

Balance at December 31, 1998                    $ 8     $ 7,405      $ 6,898    $ (4,196)      $ (364)     $ (232)      $ 9,519
                                             ======      ======       ======       ======       ======      ======       ======
</TABLE>

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.


                                                       5


<PAGE>







                                     SOUTH CAROLINA COMMUNITY BANCSHARES, INC.
                                                  AND SUBSIDIARY

                                       Consolidated Statements of Cash Flows
                                                    (Unaudited)
                                                  (in thousands)



<TABLE>
<CAPTION>

                                                                            For Six Months Ended
                                                                                December 31,
                                                                         --------------------------
                                                                              1997         1998
                                                                              ----         ----
Operating activities:
<S>                                                                      <C>          <C>        
   Net income                                                            $       189  $       217
   Adjustments to reconcile net income to net cash
     provided (used) by operating activities:
     Depreciation and amortization                                                40           32
     Gain on sale of real estate owned                                            (6)           -
     Amortization of deposit premium                                              14           11
     Deferred income taxes (benefit)                                              (7)           -
     Accretion of discounts on investment securities                              (2)           -
     Amortization of unearned compensation                                       105           87
     Net increase (decrease) in deferred loan fees                               (20)           7
     (Increase) decrease in interest receivable                                   37          (25)
     Decrease in prepaid expenses and other assets                                 2           37
     Decrease in income taxes payable                                            (78)         (20)
     Increase (decrease) in accrued expenses and other liabilities                14          (36)
                                                                          ----------   ----------
         Net cash provided by operating activities                               288          310
                                                                          ----------   ----------

Investing activities:
   Net (increase) decrease in loans                                              286       (1,930)
   Proceeds from maturities of
     investment securities held to maturity                                    1,400          800
   Purchase of investment securities held to maturity                         (2,700)      (1,061)
   Principal payments on mortgage-backed securities                                6            6
   Purchases of premises and equipment                                           (48)          (3)
                                                                          ----------   ----------
         Net cash provided (used) by investing activities                     (1,056)      (2,188)
                                                                          ----------   ----------



                                                                                     
                                                                                        (continued)
</TABLE>

                                                       6


<PAGE>







  SOUTH CAROLINA COMMUNITY BANCSHARES, INC.
                                                   AND SUBSIDIARY

                                        Consolidated Statements of Cash Flows
                                                              (Unaudited)
                                                   (in thousands)


<TABLE>
<CAPTION>

                                                                             For Six Months Ended
                                                                                 December 31,
                                                                         ---------------------------
                                                                              1997          1998
                                                                              ----          ----
Financing activities:
<S>                                                                        <C>          <C>      
   Net increase (decrease) in deposits                                     $  1,218     $ (2,470)
   Increase (decrease) in advance payments for taxes and insurance              (17)         (24)
   Stock options exercised                                                        3            6
   Purchase of treasury stock                                                (2,760)         (21)
   Dividends paid                                                              (195)        (172)
                                                                           --------     --------
         Net cash used by financing activities                               (1,751)      (2,681)
                                                                           --------     --------

Net increase (decrease) in cash and cash equivalents                         (2,519)      (4,559)

Cash and cash equivalents at beginning of period                              5,678        8,678
                                                                           --------     --------

Cash and cash equivalents at end of period                                 $  3,159     $  4,119
                                                                           ========     ========

Supplemental disclosures of cash flow information
-------------------------------------------------
   Cash paid during the period for:
     Interest                                                              $    805     $    876
                                                                           ========     ========

   Noncash investing and financing activities:
     Dividends declared but not paid                                       $    187     $    198
</TABLE>








     The accompanying notes are an integral part of these consolidated financial
statements.


                                        7


<PAGE>



                    SOUTH CAROLINA COMMUNITY BANCSHARES, INC.
                                 AND SUBSIDIARY

                   Notes to Consolidated Financial Statements
                                   (Unaudited)



1.   General
     -------

     South Carolina Community Bancshares,  Inc. (the "Company") was incorporated
     under the laws of the State of Delaware  for the  purpose of  becoming  the
     savings and loan  holding  company of Community  Federal  Savings Bank (the
     "Savings  Bank").  Both  companies are  headquartered  in Winnsboro,  South
     Carolina.  The Company is engaged  primarily in the business of  directing,
     planning and coordinating the business  activities of the Savings Bank. The
     financial  statements of the Savings Bank are  presented on a  consolidated
     basis with those of the Company.

2.   Basis of Preparation
     --------------------

     The accompanying  unaudited consolidated financial statements were prepared
     in  accordance  with  instructions  for Form 10-QSB and  therefore,  do not
     include  all  disclosures  necessary  for a  complete  presentation  of the
     consolidated   balance   sheets,   consolidated   statements   of   income,
     consolidated   statements  of   stockholders'   equity,   and  consolidated
     statements of cash flows in conformity with generally  accepted  accounting
     principles. However, all adjustments which are in the opinion of management
     necessary for the fair  presentation  of the interim  financial  statements
     have been included.  All such adjustments are of a normal recurring nature.
     The  statements  of income  for the three  and/or six month  periods  ended
     December 31, 1998 are not  necessarily  indicative of the results which may
     be expected for the entire year.

     It is suggested that these unaudited  consolidated  financial statements be
     read in conjunction with the audited consolidated  financial statements and
     notes  thereto for the Company for the year ended June 30, 1998,  which are
     included in the Form 10-KSB by reference (file no. 0-24476).

3.   Income Per share
     ----------------

     Basic and  diluted  income  per share  amounts  for the three and six month
     periods ended December 31, 1997 and 1998,  are computed in accordance  with
     Statement of Financial  Accounting  Standards No. 128, "Earnings Per Share"
     (SFAS 128).  Income per share  amounts for the three and six months  ending
     December 31, 1997 have been restated to conform with SFAS 128.  Unallocated
     ESOP shares are not considered as outstanding in accordance  with SFAS 128.
     Diluted income per share includes the effect of dilution for stock options.

                                        8


<PAGE>


SOUTH CAROLINA COMMUNITY BANCSHARES, INC.
AND SUBSIDIARY             Notes to Consolidated Financial Statements, Continued
--------------------------------------------------------------------------------

4.   Asset Quality
     -------------

     At December  31,  1998,  the Company had total  nonperforming  loans (i.e.,
     loans which are  contractually  past due 90 days or more) of  approximately
     $838,000.  Nonperforming  loans were 2.19% of total loans at  December  31,
     1998. The ratio of total  nonperforming  assets to total assets at December
     31, 1998 was 1.99%. Nonperforming assets include the nonperforming loans of
     $838,000 plus $71,000 of real estate owned.




                                        9


<PAGE>





Item 2.
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                              RESULTS OF OPERATIONS


General

The following discussion and analysis is intended to assist in understanding the
financial condition and the results of operations of the Company.  References to
the "Company" include South Carolina Community Bancshares, Inc. and/or Community
Federal Savings Bank as appropriate.

Comparison of Financial Condition at June 30, 1998 and December 31, 1998

The Company's total consolidated  assets decreased by approximately $2.4 million
or 5.0% from $48.0  million at June 30, 1998 to $45.6  million at  December  31,
1998. The decrease in assets for the period was primarily attributable to assets
used to repay a $2.4  million  public  deposit  that was  withdrawn  during  the
period. This deposit was short-term in nature.

The composition of the Company's balance sheet has not been materially  affected
by market  conditions  between June 30, 1998 and  December  31, 1998.  Net loans
increased  $1.9 million or 5.3% as a result of new loan  originations  exceeding
principal repayments and refinancing payoffs.

Consistent with its historical lending  practices,  the Company's loan portfolio
as of December 31, 1998 consisted  primarily of fixed rate loans with maturities
of up to  twenty-five  (25)  years.  The  Company  also makes (30) years  loans.
Consequently, the Company is exposed to a high degree of interest rate risk in a
rising interest rate  environment.  The Company has  historically  accepted this
risk in light of its relatively high capital levels.  See "Liquidity and Capital
Resources".

Deposits  decreased $2.5 million or 6.5%, from $38.0 million at June 30, 1998 to
$35.5  million at December  31, 1998.  The  decrease in deposits  was  primarily
attributable the withdrawal of a public deposit of $2.4 million.

Comparison of Results of Operations for the Three Months Ended December 31, 1997
and 1998

Net Income. Net income increased $26,000 from $70,000 for the three months ended
December 31, 1997 to $96,000 for the three months ended  December 31, 1998.  The
return on average  assets was 0.61% for the three months ended December 31, 1997
compared to 0.84 % for the three months ended December 31, 1998.

Net Interest Income.  Net interest income decreased $6,000 from $444,000 for the
three  months  ended  December  31, 1997 to $438,000  for the three months ended
December 31, 1998.  The decline in net  interest  income  reflects a decrease in
total interest  income offset by a corresponding  decrease in interest  expense.
Average  interest  earning assets  decreased by  approximately  $335,000 for the
three months ending December 31, 1998 as compared to the same period in 1997.



                                       10

<PAGE>




Interest Income.  Total interest income decreased  $14,000 from $878,000 for the
three  months  ended  December  31, 1997 to $864,000  for the three months ended
December 31, 1998.  Interest on loans increased by $24,000 or 3.2%.  Interest on
investments  decreased  $31,000 or 41.9% as the average  portfolio  decreased by
approximately  $2.2  million.   The  average  portfolio   decreased  during  the
comparable  periods  as a result  of the use of  investment  securities  as they
matured  or were  called to  provide  funds for stock  repurchases  and new loan
originations.

Interest Expense.  Interest expense decreased $8,000 from $434,000 for the three
months ended  December 31, 1997 to $426,000 for the three months ended  December
31, 1998.  The decrease  for the three months  ending  December 31, 1998 was the
result of a 15 basis point  decrease  in the cost of funds  offset by a $454,000
increase in the average deposits outstanding.

Provision  for Loan Losses.  The Company did not record any  provision  for loan
losses for either of the three month  periods  ended  December 31, 1997 or 1998.
Management  has  reviewed  the  allowance  for loan  losses in  relation  to the
Company's  composition  of its loan  portfolio and  observations  of the general
economic climate and loan loss expectations. Based on the loss model, management
feels that the  allowance  for loan loss is adequate at the end of both periods.
The ratio of the  allowance to  non-performing  loans at December 31, 1998,  was
35.0% and nonperforming loans to total loans were only 2.2%.

Non-Interest  Income.  Non-interest income increased $3,000 for the three months
ending  December 31, 1998.  This increase was the result of additional  fees and
service charges.

Non-Interest  Expense.  Non-interest  expense decreased by $42,000 or 12.1% from
$346,000 for the three months ending December 31, 1997 to $304,000 for 1998. The
decrease was the result of management's  efforts to control operating  expenses.
Compensation expense and employee benefits increased $7,000 or 4.2%, while total
other non-interest expenses decreased by $49,000.

Comparison of Results of Operations  for the Six Months Ended  December 31, 1997
and 1998

Net Income.  Net income increased $28,000 from $189,000 for the six months ended
December 31, 1997 to $217,000 for the six months  ended  December 31, 1998.  The
return on average  assets was 0.82% for the six months  ended  December 31, 1997
compared to 0.95% for the six months ended December 31, 1998.

Net Interest Income. Net interest income decreased $41,000 or 4.5% from $916,000
for the six months ended  December 31, 1997 to $875,000 for the six months ended
December  31,  1998.  The decline in net interest  income  primarily  reflects a
decrease  in average  interest  earning  assets of  $477,000  and an increase in
average interest bearing liabilities of approximately $1.4 million or 4.6%.

Interest Income. Total interest income decreased $35,000 or 2.0% from $1,765,000
for the six months  ended  December  31, 1997 to  $1,730,000  for the six months
ended December 31, 1998.  Interest on loans increased $20,000, or 1.3%. Interest
on investments  decreased $39,000 or 30.5%, as the average investment  portfolio
during the six months ending  December 31, 1998 was


                                       11


<PAGE>



approximately  $1.2 million less than the same period in 1997. As the investment
portfolio  matured or was called,  the proceeds  were used to fund new loans and
stock repurchases.

Interest  Expense.  Interest expense  increased $6,000 from $849,000 for the six
months ended December 31, 1997 to $855,000 for the six months ended December 31,
1998. The increase for the six months ending December 31, 1998 was the result of
a $1.4 million  increase in the average interest bearing deposits offset by a 15
basis point  decrease  in the cost of funds.  Management  continues  to focus on
attracting deposit accounts with a lower cost of funds.

Provision  for Loan Losses.  The Company did not record any  provision  for loan
losses for either of the six month  periods  ended  December  31,  1997 or 1998.
Management  has  reviewed  the  allowance  for loan  losses in  relation  to the
Company's  composition  of its loan  portfolio and  observations  of the general
economic  climate  and loan loss  expectations.  Based on its loan  loss  model,
management feels that the allowance for loan loss is adequate at the end of both
periods.

Non-Interest  Income.  Non-interest  income  increased $8,000 for the six months
ending  December 31, 1998.  This increase was the result of additional  fees and
service charges produced through its banking operations.

Non-Interest  Expense.  Non-interest  expense decreased by $65,000 or 10.0% from
$647,000  for the six months  ending  December  31, 1997 to  $582,000  for 1998.
Expenses  associated  with the expanded  bank  facilities,  products and general
operations have stabilized.


Liquidity  and Capital  Resources.  The Company's  primary  sources of funds are
deposits, proceeds from principal and interest payments on loans, and investment
maturities.  While investment maturities and scheduled amortization of loans are
a  predictable  source of funds,  deposit  flows and  mortgage  prepayments  are
greatly   influenced  by  general  interest  rates,   economic   conditions  and
competition. The Company's primary investing activity is loan originations.  The
Company maintains liquidity levels adequate to fund loan commitments, investment
opportunities, deposit withdrawals and other financial commitments.

At  December  31,  1998,   there  were  no  material   commitments  for  capital
expenditures.  Obligations to fund  outstanding loan commitments at December 31,
1998 were approximately $614,000.

At December 31,  1998,  management  had no  knowledge  of any trends,  events or
uncertainties  that will have or are reasonably  likely to have material effects
on the liquidity,  capital resources or operations of the Company.  Furthermore,
management  was not  aware  of any  current  recommendations  by the  regulatory
authorities, which, if implemented, would have such an effect.

The Savings Bank exceeded all of its capital  requirements at December 31, 1998.
The Savings Bank had the following  capital  ratios at December  31,1998 and was
categorized as "well capitalized" under the Prompt Corrective Action regulations
adopted  by the  OTS  pursuant  to the  Federal  Deposit  Insurance  Corporation
Improvement Act of 1991.

                                       12


<PAGE>

<TABLE>
<CAPTION>

                                                                     For Capital               Categorized as
                                            Actual                Adequacy Purposes         'Well Capitalized'(1)
                                    ------------------------    -----------------------    ------------------------
                                      Amount       Ratio          Amount      Ratio          Amount       Ratio
                                    ------------ -----------    ----------- -----------    ------------ -----------
   As of December 31, 1998:

   Adjusted total Capital
<S>                                 <C>              <C>        <C>              <C>       <C>              <C>  
      (To risk weighted assets)     $    8,886       37.5%      $    1,895       8.0%      $    2,369       10.0%

   Tier I Capital
      (To risk weighted assets)     $    8,595       36.3%      $      948       4.0%      $    1,421        6.0%

   Tier I Capital
      (To total assets)             $    8,595       19.2%      $    1,794       4.0%      $    2,242        5.0%
</TABLE>

   (1) As categorized under the Prompt Corrective Action Provisions.


Year 2000  Issues.  The Company has  formulated a Year 2000  Compliance  Plan to
address the Year 2000 issue. The phases identified under the plan are awareness,
assessment,  renovation, validation and implementation.  The purpose of the plan
is to outline the  procedures  necessary  for assuring  that the Company is in a
state  of  readiness  for the  century  date  change.  Substantially  all of the
Company's  material  data  processing  functions  are  provided by a third party
service bureau. The service bureau has advised the Company in writing that it is
Year 2000 compliant.  The Company has received certifications of compliance from
approximately  90%  of  its  other  software  vendors.  Company  personnel  have
completed  testing on all computer  hardware and software with minimal  failures
being  detected.  The Company is making written and oral inquiries of customers,
suppliers  and  non-information  technology  providers  as to  their  year  2000
readiness.  Testing to date  indicates  very little hard cost of  remediation in
management's  opinion,  with  the  primary  cost  of  the  Company's  Year  2000
compliance  being staff time during the assessment,  testing and  implementation
stages. As of December 31, 1998, the Company has incurred  approximately  $5,000
in expenses toward remediating the Year 2000 issue.

Based on the results of further  system  testing and results of written and oral
inquiries,  the Company will continue to develop its contingency plan to provide
solutions  to the Year 2000  issue.  This  contingency  plan will be designed to
prepare an  operating  alternative  in the event that  systems do not perform as
planned  either  before or after the  century  date  change.  The  Company has a
reasonable basis to conclude that the Year 2000 issue will not materially affect
future  financial  results,  or cause reported  financial  information not to be
necessarily   indicative  of  future  operating   results  or  future  financial
condition.  Successful  implementation  of this plan is expected to mitigate any
extraordinary expenses related to the Year 2000 issue. However, no assurance can
be given that the Year 2000  compliance  plan will be completed  successfully by
the Year 2000.

Successful  and  timely  completion  of  the  Year  2000  project  is  based  on
management's best estimates  derived from various  assumptions of future events.
These events are  inherently  uncertain,  including  the progress and results of
vendors, suppliers and customers Year 2000 readiness.


                                       13


<PAGE>




Part II.  OTHER INFORMATION



Item 1.   Legal Proceedings
          -----------------

          From time to time,  the Company and any  subsidiary  may be a party to
          various  legal  proceedings  incident  to its or  their  business.  At
          December  31,  1998,  there  were no legal  proceedings  to which  the
          Company  or any  subsidiary  was a party,  or to which of any of their
          property was subject, which were expected by management to result in a
          material loss.

Item 2.   Changes in Securities
          ---------------------

          None

Item 3.   Defaults Upon Senior Securities
          -------------------------------

          None

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

          The Annual Meeting of Stockholders of the Company ("Meeting") was held
          on December 16, 1998. The results of the vote on the matters presented
          at the Meeting were as follows:

          1. The following  individuals  were elected as  directors,  each for a
             three-year term:


                                                     Vote For    Vote Withheld
                                                     --------    -------------
                Richard H. Burton                     423,580         3,700
                George R. Lauderdale, Jr.             423,580         3,700

          2. Crisp Hughes Evans LLP was ratified as the independent auditors for
             the  year  ending June  30, 1999.  The  vote was  427,280 for, none
             against and none abstained.

Item 5.   Other Information
          -----------------

            None
 
Item 6.   Exhibits and Reports on Form 8-K
          --------------------------------
 
 
             27     Financial Data Schedule

No reports on Form 8-K were filed during the quarter ended December 31, 1998.



                                       14


<PAGE>




     SIGNATURES




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

                                     South Carolina Community Bancshares, Inc.



Date: February 12, 1999               By /s/ Alan W. Pullen
      --------------------------         ------------------
                                             Alan W. Pullen
                                             (President and Chief Executive
                                              Officer)




                                     South Carolina Community Bancshares, Inc.



Date: February 12, 1999               By /s/ Terri Robinson
      --------------------------         ------------------
                                             Terri Robinson
                                             (Chief Financial Officer)
















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