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SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

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FORM 10-Q

Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

For the quarter ended September 30, 2003

Commission file number 000-25128

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MAIN STREET BANKS, INC.(Exact name of registrant as specified in its charter)

|Georgia(State of Incorporation) 676 Chastain Road, Kennesaw, GA(Address of principal executive offices) |  | 58-2104977(I.R.S. Employer Identification No.) 30144(Zip Code)
|------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------

770-422-2888(Registrant's telephone number)

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

Yes
ý    No o

Indicate
by check whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes
ý    No o

As
of October 31, 2003 registrant had outstanding 18,934,770 shares of common stock.

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MAIN STREET BANKS, INC.  TABLE OF CONTENTS

|                              |  |                                                                                                                                                                              |  | Page
|----------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----
|PART I. FINANCIAL INFORMATION |  |                                                                                                                                                                             
|Item 1.                       |  | Financial Statements (unaudited)                                                                                                                                             |  |     
|                              |  | Consolidated Balance Sheets
        September 30, 2003, December 31, 2002 and September 30, 2002                                                                             |  | 2   
|                              |  | Consolidated Statements of Income (unaudited)
        Three Months Ended September 30, 2003 and 2002 and
        Nine Months Ended September 30, 2003 and 2002               |  | 3   
|                              |  | Consolidated Statements of Comprehensive Income (unaudited)
        Three Months Ended September 30, 2003 and 2002 and
        Nine Months Ended September 30, 2003 and 2002 |  | 4   
|                              |  | Consolidated Statements of Cash Flows (unaudited)
        Nine Months Ended September 30, 2003 and 2002                                                                      |  | 5   
|                              |  | Notes to Consolidated Financial Statements (unaudited)                                                                                                                       |  | 6   
|Item 2.                       |  | Management's Discussion and Analysis of
    Financial Condition and Results of Operations                                                                                    |  | 12  
|Item 3.                       |  | Quantitative and Qualitative Disclosures about Market Risk                                                                                                                   |  | 22  
|Item 4.                       |  | Controls and Procedures                                                                                                                                                      |  | 22  
|PART II. OTHER INFORMATION    |  |                                                                                                                                                                             
|Item 1.                       |  | Legal Proceedings                                                                                                                                                            |  | 23  
|Item 2.                       |  | Changes in Securities                                                                                                                                                        |  | 23  
|Item 3.                       |  | Defaults Upon Senior Securities                                                                                                                                              |  | 23  
|Item 4.                       |  | Submission of Matters to a Vote of Security Holders                                                                                                                          |  | 23  
|Item 5.                       |  | Other Information                                                                                                                                                            |  | 23  
|Item 6.                       |  | Exhibits and Reports on Form 8-K                                                                                                                                             |  | 23  
|                              |  | Signatures                                                                                                                                                                   |  | 25  
|                              |  | Exhibit 31.1 Certification of CEO                                                                                                                                            |  | 26  
|                              |  | Exhibit 31.2 Certification of CFO                                                                                                                                            |  | 27  
|                              |  | Exhibit 32.1                                                                                                                                                                 |  | 28  
|                              |  | Exhibit 32.2                                                                                                                                                                 |  | 29  

1

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PART I.FINANCIAL INFORMATION  ITEM 1. FINANCIAL STATEMENTS

MAIN STREET BANKS, INC.
CONSOLIDATED BALANCE SHEETS

|                                                                                                                                                                                                          |                                          | (Unaudited)
September 30,
2003 |               | December 31,
2002 |   | (Unaudited)
September 30,
2002 |            
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------- | ------------------------------ | ------------- | ----------------- | - | ------------------------------ | -----------
|Assets                                                                                                                                                                                                    |                                          |                                |               |                   |   |                                |            
|Cash and due from banks                                                                                                                                                                                   |                                          | $                              | 39,559,729    |                   | $ | 43,711,817                     |            
|Interest-bearing deposits in banks                                                                                                                                                                        |                                          |                                | 693,409       |                   |   | 1,782,121                      |            
|Federal funds sold and securities purchased under agreements to resell                                                                                                                                    |                                          |                                | 15,919,619    |                   |   | 54,656,351                     |            
|Investment securities available for sale (costs of $243,620,558, $201,404,160, and $209,405,916 at September 30, 2003, December 31, 2002 and September 30, 2002, respectively)                            |                                          |                                | 247,867,031   |                   |   | 208,455,409                    |            
|Investment securities held to maturity (fair value of $743,002, $754,704, and $756,253 at September 30, 2003, December 31, 2002 and September 30, 2002, respectively)                                     |                                          |                                | 688,005       |                   |   | 687,562                        |            
|Other investments                                                                                                                                                                                         |                                          |                                | 17,081,869    |                   |   | 3,699,368                      |            
|Mortgage loans held for sale                                                                                                                                                                              |                                          |                                | 6,490,437     |                   |   | 8,175,522                      |            
|Loans, net of unearned income                                                                                                                                                                             |                                          |                                | 1,411,950,618 |                   |   | 982,486,447                    |            
|Allowance for loan losses                                                                                                                                                                                 |                                          |                                | (20,765,376   | )                 |   | (14,588,582                    | )          
|                                                                                                                                                                                                          |                                          |                                |               |                   |   |                                |            
|Loans, net                                                                                                                                                                                                |                                          |                                | 1,391,185,242 |                   |   | 967,897,865                    |            
|Premises and equipment, net                                                                                                                                                                               |                                          |                                | 41,726,221    |                   |   | 31,674,673                     |            
|Other real estate                                                                                                                                                                                         |                                          |                                | 1,366,820     |                   |   | 815,880                        |            
|Accrued interest receivable                                                                                                                                                                               |                                          |                                | 8,069,190     |                   |   | 6,437,290                      |            
|Goodwill and other intangible assets                                                                                                                                                                      |                                          |                                | 94,919,932    |                   |   | 16,372,018                     |            
|Bank owned life insurance                                                                                                                                                                                 |                                          |                                | 35,274,639    |                   |   | 30,904,434                     |            
|Other assets                                                                                                                                                                                              |                                          |                                | 10,275,482    |                   |   | 6,719,791                      |            
|                                                                                                                                                                                                          |                                          |                                |               |                   |   |                                |            
|Total assets                                                                                                                                                                                              |                                          |                                | 1,911,117,625 |                   |   | 1,381,990,101                  |            
|                                                                                                                                                                                                          |                                          |                                |               |                   |   |                                |            
|Liabilities                                                                                                                                                                                               |                                          |                                |               |                   |   |                                |            
|Deposits:                                                                                                                                                                                                 |                                          |                                |               |                   |   |                                |            
|                                                                                                                                                                                                          | Noninterest-bearing demand               |                                |               | 224,032,272       |   |                                | 184,130,490
|                                                                                                                                                                                                          | Interest-bearing demand and money market |                                |               | 468,008,614       |   |                                | 330,230,983
|                                                                                                                                                                                                          | Savings                                  |                                |               | 44,643,939        |   |                                | 47,261,815 
|                                                                                                                                                                                                          | Time deposits of $100,000 or more        |                                |               | 254,152,103       |   |                                | 197,098,700
|                                                                                                                                                                                                          | Other time deposits                      |                                |               | 446,803,841       |   |                                | 370,205,897
|                                                                                                                                                                                                          |                                          |                                |               |                   |   |                                |            
|Total deposits                                                                                                                                                                                            |                                          |                                | 1,437,640,769 |                   |   | 1,128,927,885                  |            
|Accrued interest payable                                                                                                                                                                                  |                                          |                                | 3,343,309     |                   |   | 3,723,167                      |            
|Federal Home Loan Bank advances                                                                                                                                                                           |                                          |                                | 159,739,071   |                   |   | 50,000,000                     |            
|Federal funds purchased and securities sold under repurchase agreements                                                                                                                                   |                                          |                                | 61,575,200    |                   |   | 47,666,699                     |            
|Trust preferred securities                                                                                                                                                                                |                                          |                                | 50,000,000    |                   |   | 5,155,000                      |            
|Other liabilities                                                                                                                                                                                         |                                          |                                | 4,753,559     |                   |   | 14,860,481                     |            
|                                                                                                                                                                                                          |                                          |                                |               |                   |   |                                |            
|Total liabilities                                                                                                                                                                                         |                                          |                                | 1,717,051,908 |                   |   | 1,250,333,232                  |            
|Shareholders' Equity                                                                                                                                                                                      |                                          |                                |               |                   |   |                                |            
|Common stock-no par value per share; 50,000,000 shares authorized; 18,933,178, 16,242,498 and 15,979,634 shares outstanding at September 30, 2003, December 31, 2002 and September 30, 2002,
respectively |                                          |                                | 99,454,457    |                   |   | 46,912,168                     |            
|Retained earnings                                                                                                                                                                                         |                                          |                                | 99,132,523    |                   |   | 86,041,957                     |            
|Accumulated other comprehensive income, net of tax                                                                                                                                                        |                                          |                                | 4,267,326     |                   |   | 5,561,196                      |            
|Treasury stock, at cost, 564,082, 464,082 and 379,682 shares at September 30, 2003, December 31, 2002 and September 30, 2002, respectively                                                                |                                          |                                | (8,788,589    | )                 |   | (6,858,452                     | )          
|                                                                                                                                                                                                          |                                          |                                |               |                   |   |                                |            
|Total shareholders' equity                                                                                                                                                                                |                                          |                                | 194,065,717   |                   |   | 131,656,869                    |            
|                                                                                                                                                                                                          |                                          |                                |               |                   |   |                                |            
|Total liabilities and shareholders' equity                                                                                                                                                                |                                          | $                              | 1,911,117,625 |                   | $ | 1,381,990,101                  |            
|                                                                                                                                                                                                          |                                          |                                |               |                   |   |                                |            

See accompanying notes to consolidated financial statements.

2

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MAIN STREET BANKS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

|                                                    |                                                     | Three Months Ended
September 30, |            | Nine Months Ended
September 30, |          
|--------------------------------------------------- | --------------------------------------------------- | -------------------------------- | ---------- | ------------------------------- | ---------
|
|Interest income:                                    |                                                     |                                  |            |                                 |          
|                                                    | Loans, including fees                               |                                  | $          | 23,774,469                      |          
|                                                    | Investment securities:                              |                                  |            |                                 |          
|                                                    |                                                     | Taxable                          |            |                                 | 1,952,469
|                                                    |                                                     | Non-taxable                      |            |                                 | 413,969  
|                                                    | Federal funds sold and other short-term investments |                                  |            | 3,982                           |          
|                                                    | Interest-bearing deposits in banks                  |                                  |            | 4,700                           |          
|                                                    | Other investments                                   |                                  |            | 160,278                         |          
|                                                    |                                                     |                                  |            |                                 |          
|Total interest income                               |                                                     |                                  | 26,309,867 |                                 |          
|Interest expense:                                   |                                                     |                                  |            |                                 |          
|                                                    | Interest-bearing demand and money market            |                                  |            | 1,533,317                       |          
|                                                    | Savings                                             |                                  |            | 80,733                          |          
|                                                    | Time deposits of $100,000 or more                   |                                  |            | 1,911,103                       |          
|                                                    | Other time deposits                                 |                                  |            | 2,378,300                       |          
|                                                    | Federal funds purchased                             |                                  |            | 19,308                          |          
|                                                    | Federal Home Loan Bank advances                     |                                  |            | 679,715                         |          
|                                                    | Trust preferred securities                          |                                  |            | 580,096                         |          
|                                                    | Other interest expense                              |                                  |            | 362,260                         |          
|                                                    |                                                     |                                  |            |                                 |          
|Total interest expense                              |                                                     |                                  | 7,544,832  |                                 |          
|                                                    |                                                     |                                  |            |                                 |          
|Net interest income                                 |                                                     |                                  | 18,765,035 |                                 |          
|Provision for loan losses                           |                                                     |                                  | (1,146,000 | )                               |          
|                                                    |                                                     |                                  |            |                                 |          
|Net interest income after provision for loan losses |                                                     |                                  | 17,619,035 |                                 |          
|Non-interest income:                                |                                                     |                                  |            |                                 |          
|                                                    | Service charges on deposit accounts                 |                                  |            | 2,092,139                       |          
|                                                    | Other customer service fees                         |                                  |            | 388,960                         |          
|                                                    | Mortgage banking income                             |                                  |            | 1,118,464                       |          
|                                                    | Investment agency commissions                       |                                  |            | 88,616                          |          
|                                                    | Insurance agency income                             |                                  |            | 1,188,538                       |          
|                                                    | Income from SBA lending                             |                                  |            | 405,936                         |          
|                                                    | Income on bank owned life insurance                 |                                  |            | 748,129                         |          
|                                                    | Other income                                        |                                  |            | 212,063                         |          
|                                                    | Gain (loss) on sales of premises and equipment      |                                  |            | (7,901                          | )        
|                                                    | Investment securities gains                         |                                  |            | 300,837                         |          
|                                                    |                                                     |                                  |            |                                 |          
|Total non-interest income                           |                                                     |                                  | 6,535,781  |                                 |          
|Non-interest expense:                               |                                                     |                                  |            |                                 |          
|                                                    | Salaries and other compensation                     |                                  |            | 6,799,573                       |          
|                                                    | Employee benefits                                   |                                  |            | 1,283,603                       |          
|                                                    | Net occupancy and equipment expense                 |                                  |            | 1,772,929                       |          
|                                                    | Data processing fees                                |                                  |            | 449,812                         |          
|                                                    | Professional services                               |                                  |            | 824,785                         |          
|                                                    | Communications & supplies                           |                                  |            | 983,575                         |          
|                                                    | Marketing expense                                   |                                  |            | 198,803                         |          
|                                                    | Regulatory agency assessments                       |                                  |            | 73,557                          |          
|                                                    | Amortization of intangible assets                   |                                  |            | 106,750                         |          
|                                                    | Other expense                                       |                                  |            | 1,874,717                       |          
|                                                    |                                                     |                                  |            |                                 |          
|Total non-interest expense                          |                                                     |                                  | 14,368,104 |                                 |          
|                                                    |                                                     |                                  |            |                                 |          
|Income before income taxes                          |                                                     |                                  | 9,786,712  |                                 |          
|Income tax expense                                  |                                                     |                                  | 2,668,556  |                                 |          
|                                                    |                                                     |                                  |            |                                 |          
|Net income                                          |                                                     | $                                | 7,118,156  |                                 | $        
|                                                    |                                                     |                                  |            |                                 |          
|Earnings per share:                                 |                                                     |                                  |            |                                 |          
|                                                    | Basic                                               |                                  | $          | 0.38                            |          
|                                                    | Diluted                                             |                                  | $          | 0.36                            |          
|Dividends declared per share                        |                                                     | $                                | 0.120      |                                 | $        
|Weighted average common shares outstanding:         |                                                     |                                  |            |                                 |          
|                                                    | Basic                                               |                                  |            | 18,913,088                      |          
|                                                    | Diluted                                             |                                  |            | 19,602,219                      |          

See accompanying notes to consolidated financial statements.

3

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MAIN STREET BANKS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)

|                                                                        |  | Three Months Ended
September 30, |            | Nine Months Ended
September 30,
|----------------------------------------------------------------------- |  | -------------------------------- | ---------- | -------------------------------
|
|Net income                                                              |  | $                                | 7,118,156  |                                
|Other comprehensive income (loss), net of tax:                          |  |                                  |            |                                
|Unrealized gains (losses) on securities available for sale              |  |                                  | (2,325,343 | )                              
|Unrealized gains on derivative contracts                                |  |                                  | 399,477    |                                
|Less reclassification adjustment for net (gains) included in net income |  |                                  | (198,552   | )                              
|                                                                        |  |                                  |            |                                
|Comprehensive income                                                    |  | $                                | 4,993,738  |                                
|                                                                        |  |                                  |            |                                

See accompanying notes to consolidated financial statements.

4

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MAIN STREET BANKS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

|                                                                                  |                                                         | Nine Months Ended
September 30, |             
|--------------------------------------------------------------------------------- | ------------------------------------------------------- | ------------------------------- | ------------
|
|Operating activities                                                              |                                                         |                                 |             
|Net income                                                                        |                                                         | $                               | 19,252,623  
|Adjustments to reconcile net income to net cash provided by operating activities: |                                                         |                                 |             
|                                                                                  | Provision for loan losses                               |                                 |             
|                                                                                  | Depreciation and amortization of premises and equipment |                                 |             
|                                                                                  | Amortization of intangible assets                       |                                 |             
|                                                                                  | Loss on sales of other real estate                      |                                 |             
|                                                                                  | Investment securities gains                             |                                 |             
|                                                                                  | Net amortization of investment securities               |                                 |             
|                                                                                  | Net accretion of loans purchased                        |                                 |             
|                                                                                  | Loss on sales of premises and equipment                 |                                 |             
|                                                                                  | Net decrease in mortgage loans held for sale            |                                 |             
|                                                                                  | Gain on mortgage loan sales                             |                                 |             
|                                                                                  | Gains on sales of SBA loans                             |                                 |             
|                                                                                  | Deferred income tax (benefit) provision                 |                                 |             
|                                                                                  | Deferred net loan fees (cost amortization)              |                                 |             
|                                                                                  | Vesting in restricted stock award plan                  |                                 |             
|Changes in operating assets and liabilities:                                      |                                                         |                                 |             
|                                                                                  | (Increase) in accrued interest receivable               |                                 |             
|                                                                                  | (Decrease) in accrued interest payable                  |                                 |             
|                                                                                  | Other                                                   |                                 |             
|                                                                                  |                                                         |                                 |             
|Net cash provided by operating activities                                         |                                                         |                                 | 21,912,125  
|Investing activities                                                              |                                                         |                                 |             
|Purchases of investment securities available for sale                             |                                                         |                                 | (129,729,831
|Purchases of other investments                                                    |                                                         |                                 | (11,754,423 
|Maturities, paydowns and calls of investment securities available for sale        |                                                         |                                 | 65,397,747  
|Proceeds from sales of investment securities available for sale                   |                                                         |                                 | 19,619,773  
|Net increase in loans funded                                                      |                                                         |                                 | (141,551,797
|Purchases of premises and equipment                                               |                                                         |                                 | (7,164,522  
|Purchase of treasury stock                                                        |                                                         |                                 | (1,930,137  
|Proceeds from sales of premises and equipment                                     |                                                         |                                 | 7,507       
|Proceeds from sales of other real estate                                          |                                                         |                                 | 2,408,206   
|Improvements to other real estate                                                 |                                                         |                                 | (194,798    
|Net cash paid for acquisitions                                                    |                                                         |                                 | (32,994,404 
|                                                                                  |                                                         |                                 |             
|Net cash used in investing activities                                             |                                                         |                                 | (237,886,679
|Financing activities                                                              |                                                         |                                 |             
|Net increase in demand and savings accounts                                       |                                                         |                                 | 70,163,361  
|(Decrease) increase in time deposits                                              |                                                         |                                 | (43,645,897 
|Increase in federal funds purchased                                               |                                                         |                                 | 13,908,501  
|Net increase (decrease) in Federal Home Loan Bank advances                        |                                                         |                                 | 94,739,071  
|Proceeds from issuance of trust preferred securities                              |                                                         |                                 | 44,845,000  
|Dividends paid                                                                    |                                                         |                                 | (6,084,377  
|Proceeds from issuance of common stock                                            |                                                         |                                 |            
|Payments to repurchase common stock                                               |                                                         |                                 | (1,928,637  
|                                                                                  |                                                         |                                 |             
|Net cash provided by financing activities                                         |                                                         |                                 | 171,997,022 
|Net decrease in cash and cash equivalents                                         |                                                         |                                 | (43,977,532 
|Cash and cash equivalents at beginning of period                                  |                                                         |                                 | 100,150,289 
|                                                                                  |                                                         |                                 |             
|Cash and cash equivalents at end of period                                        |                                                         | $                               | 56,172,757  
|                                                                                  |                                                         |                                 |             
|Supplemental disclosures of cash flow information                                 |                                                         |                                 |             
|Cash paid during the period for:                                                  |                                                         |                                 |             
|                                                                                  | Interest                                                |                                 | $           
|                                                                                  | Income taxes, net                                       |                                 |             
|Supplemental disclosures of noncash transactions                                  |                                                         |                                 |             
|Loans transferred to other real estate acquired through foreclosure               |                                                         | $                               | 3,496,300   

See accompanying notes to consolidated financial statements.

5

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MAIN STREET BANKS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
September 30, 2003



The accompanying unaudited consolidated financial statements for Main Street Banks, Inc. (the "Company") have been prepared in accordance with accounting
principles generally accepted in the United States followed within the financial services industry for interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required for complete financial statement presentation. In the opinion of
management, all adjustments (consisting solely of normal recurring adjustments) considered necessary for a fair presentation of the financial position and results of operations for interim periods
have been included.

The
results of operations for the nine-month period ended September 30, 2003 are not necessarily indicative of the results that may be expected for the year ending
December 31, 2003. These financial statements and related "Management's Discussion and Analysis of Financial Condition and Results of Operations" should be read in conjunction with the
consolidated financial statements and notes thereto for the year ended December 31, 2002, included in the Company's Annual Report on Form 10-K.

Certain
previously reported amounts have been reclassified to conform to current financial statement presentation. These reclassifications had no effect on net income or stockholders'
equity.



On May 22, 2003, the Company completed its acquisition of First Colony Bancshares, Inc., parent of First Colony Bank, a $320 million asset
bank headquartered in Alpharetta, Georgia. The transaction was accounted for as a purchase business combination and accordingly, the results of operations of First Colony Bank are included from the
acquisition date. Main Street issued 2.6 million shares of its common stock and paid $45.0 million in cash in exchange for all outstanding shares of First Colony Bancshares. The merger
consideration was based on Main Street's average closing price of $21.28 for the 30-day period immediately prior to the closing. The cash for the transaction was generated by the sale of
$45.0 million of Main Street Banks Statutory Trust II floating rate trust preferred securities ("Capital Securities") with a maturity date of June 30, 2033 and a stated liquidation
amount of $1,000 per Capital Security. Interest on the Capital Securities is to be paid on the last day of each March, June, September, and December and is reset quarterly based on the three month
London interbank offered rate ("3-Month LIBOR") plus 325 basis points at the end of the preceding quarter, provided, however, that prior to May 22, 2008, the 3-Month
LIBOR shall not exceed 8.75%. Goodwill and Intangible Assets of $74.8 million were created as a result of the transaction. Summarized below is an initial allocation of assets and liabilities
acquired (in thousands and unaudited):

Assets acquired:Cash and Cash equivalents

$
24,048Loans


283,661Other assets


17,894Goodwill and other intangibles


74,800Total Assets

$
400,403Liabilities acquiredDeposits


282,195Other Liabilities


17,567Total Liabilities

$
299,762


6

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The
acquisition of First Colony Bancshares was accounted for as a purchase business combination therefore the consolidated financial statements include results of
operations since the purchase date only. In accordance with FAS 141 the following tables present unaudited summary information on a pro forma basis as if the acquisition had occurred as of the
beginning of each of the periods presented. The proforma information does not necessarily reflect the results of operations that would have occurred if the acquisition had occurred at the beginning of
the periods presented or of any results which may be expected to occur in the future.

(Unaudited)
September 30,
2003

(Unaudited)
September 30,
2002AssetsCash and due from depository institutions

$
40,253,138

$
71,841,180Securities


264,474,655


277,626,469Other investments


17,081,869


Loans


1,397,675,679


1,138,011,694Other Assets


191,632,284


76,709,280Total Assets

$
1,911,117,625

$
1,564,188,623LiabilitiesTotal Deposits


1,437,640,769


1,290,422,241Other Liabilities


279,411,139


131,689,529Total Liabilities


1,717,051,908


1,422,111,770Shareholders' EquityTotal shareholders' equity


194,065,717


142,076,853Total liabilities and shareholders' equity

$
1,911,117,625

$
1,564,188,623


(Unaudited)
Nine months ended
September 30,
2003

(Unaudited)
Nine months ended
September 30,
2002Interest Income

$
76,934,686

$
72,360,137Interest Expense


21,851,374


23,991,613Loan Loss Provision


4,294,000


2,576,000Non-interest Income


18,018,351


15,924,384Non-interest Expense


48,343,040


43,037,219Net Income

$
20,464,623

$
18,679,689




In June 2002, the FASB issued FASB Statement No. 146, "Accounting for Costs Associated with Exit or Disposal Activities". This Statement requires
that a liability for costs associated with exit or disposition activities be recognized when the liability is incurred and be measured at fair value and adjusted for changes in estimated cash flows.
Prior guidance provided for the recognition of such costs at the date of management's commitment to an exit plan. Under Statement No. 146, management's commitment to an exit plan would not be
sufficient, by itself, to recognize a liability. The Statement was effective for exit or disposal activities initiated after December 31, 2002 and did not have a material impact on the results
of operations or financial condition of the Company.

In
November 2002, the FASB issued Interpretation No. 45 ("FIN 45"), "Guarantees, Including Indirect Guarantees of Indebtedness of Others," to clarify accounting and
disclosure requirements

7

---

relating
to a guarantor's issuance of certain types of guarantees. FIN 45 requires entities to disclose additional information about certain guarantees, or groups of similar guarantees, even if the
likelihood of the guarantor's having to make any payments under the guarantee is remote. The disclosure provisions were effective for financial statements for fiscal years ended after
December 15, 2002. For certain guarantees, the interpretation also requires that guarantors recognize a liability equal to the fair value of the guarantee upon its issuance. The initial
recognition and measurement provision is to be applied only on a prospective basis to guarantees issued or modified after December 31, 2002. The adoption of this Interpretation did not have a
material impact on the Company's financial statements.

In
December 2002, the FASB issued Statement No. 148 ("SFAS 148"), "Accounting for Stock-Based CompensationTransition and Disclosure," an amendment of
Statement of Financial Accounting Standards No. 123. SFAS 148 provides alternative methods of transition for a voluntary change to the fair value based method of accounting for
stock-based employee compensation. In addition, SFAS 148 is effective for fiscal years ended after December 15, 2002. The Company plans to continue to account for stock-based employee
compensation under the intrinsic value based method and to provide disclosure of the impact of the fair value based method on reported income. Employee stock options have characteristics that are
significantly different from those of traded options, including vesting provisions and trading limitations that impact their liquidity. Therefore, the existing option pricing models, such as
Black-Scholes, do not necessarily provide a reliable measure of the fair value of employee stock options. Refer to Note 6 for pro forma disclosure of the impact of stock options utilizing the
Black-Scholes valuation method. The adoption of this statement did not have a material impact on the financial condition or operating results of the Company.

In
January 2003, the FASB issued FASB Interpretation No. 46 ("FIN No. 46") "Consolidation of Variable Interest Entities" which addresses consolidation by business
enterprises of variable interest entities. FIN No. 46 clarifies the application of Accounting Research Bulletin No. 51 ("ARB No. 51"), Consolidated Financial Statements, to
certain entities in which equity investors do not have the characteristics of a
controlling financial interest or do not have the sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. FIN
No. 46 applies immediately to variable interest entities created after January 31, 2003, and to variable interest entities in which an enterprise obtains an interest after that date. It
applies in the fiscal year or interim period beginning after June 15, 2003, to variable interest entities in which an enterprise holds a variable interest that it acquired before
February 1, 2003.

Main
Street Bank expects to adopt FIN No. 46 in connection with its consolidated financial statements for the year ended December 31, 2003. In its current form, FIN
No. 46 may require Main Street Bank to de-consolidate its investment in Main Street Banks Statutory Trust II in future financial statements. The potential
de-consolidation of subsidiary trusts of bank holding companies formed in connection with the issuance of trust preferred securities, similar to Main Street Banks Statutory Trust II,
appears to be an unintended consequence of FIN No. 46. It is currently unknown if, or when, the FASB will address this issue. In July 2003, the Board of Governors of the Federal Reserve
System issued a supervisory letter instructing bank holding companies to continue to include the trust preferred securities in their Tier I capital for regulatory capital purposes until notice is
given to the contrary. The Federal Reserve intends to review the regulatory implications of any accounting treatment changes and, if necessary or warranted, provide further appropriate guidance. There
can be no assurance that the Federal Reserve will continue to permit institutions to include trust preferred securities in Tier I capital for regulatory capital purposes. The interpretations of FIN
No. 46 and its application to various transaction types and structures are evolving. Management continuously monitors emerging issues related to FIN No. 46, some of which could
potentially impact the Corporation's financial statements. At September 30, 2003, Main Street Bank has $50.0 million in trust preferred securities that have been consolidated on our
Balance Sheet. In the event of an adverse ruling on the tax treatment or capital

8

---

structure
treatment of proposed changes, the Company may redeem the trust preferred securities in order to maintain solid capital structure and sufficient liquidity.

During
October 2003, the FASB issued Staff Position No. FIN No. 46-6 deferring the effective date for applying the provisions of FIN No. 46 until the end
of the first interim or annual period ending after December 15, 2003 if the variable interest was created prior to February 1, 2003 and the public entity has not issued financial
statements reporting that variable interest entity in accordance with FIN No. 46. The FASB also indicated it would be issuing a modification to FIN No. 46 prior to the end of 2003.

In
April 2003, the FASB issued Statement of Financial Accounting Standards ("SFAS") No. 149,Amendment of Statement 133 on Derivative Instruments
and Hedging Activities("SFAS No. 149") which is effective for hedging relationships entered into or modified after June 30, 2003. SFAS No. 149 amends and
clarifies financial accounting and reporting for derivative instruments, including certain derivative instruments embedded in other contracts and for hedging activities. Management does not anticipate
a material impact on the Company's financial statements from the adoption of this pronouncement.

In
May 2003, the FASB issued SFAS No. 150,Accounting for Certain Financial Instruments with Characteristics of both Liabilities and
Equity("SFAS No. 150"). SFAS No. 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both
liabilities and equity in its balance sheet. SFAS No. 150 became effective in the third quarter of 2003. Management does not anticipate a material impact on the Company's financial statements
from the adoption of this pronouncement.



The computation of diluted earnings per share is as follows:

|                                 |                            | Three Months Ended
September 30, |            | Nine Months Ended
September 30,
|-------------------------------- | -------------------------- | -------------------------------- | ---------- | -------------------------------
|
|Basic and diluted net income     |                            | $                                | 7,118,156  |                                
|                                 | Basic earnings per share   |                                  | $          | 0.38                           
|                                 | Diluted earnings per share |                                  | $          | 0.36                           
|Dividends declared per share     |                            | $                                | 0.120      |                                
|Basic weighted average shares    |                            |                                  | 18,913,088 |                                
|Effect of Employee Stock Options |                            |                                  | 689,131    |                                
|                                 |                            |                                  |            |                                
|Diluted weighted average shares  |                            |                                  | 19,602,219 |                                
|                                 |                            |                                  |            |                                

9

---



Loans are stated at unpaid principal balances, net of unearned income and deferred loan fees. Interest is accrued only if deemed collectible. The following table
represents the composition of the Company's loan portfolio:

|                             |                           | September 30,
2003 |               | December 31,
2002 |   | September 30,
2002 |            
|---------------------------- | ------------------------- | ------------------ | ------------- | ----------------- | - | ------------------ | -----------
|Loans                        |                           |                    |               |                   |   |                    |            
|Commercial and industrial    |                           | $                  | 120,508,759   |                   | $ | 104,061,368        |            
|Real estate construction     |                           |                    | 332,971,587   |                   |   | 238,415,023        |            
|Residential mortgage         |                           |                    | 262,686,049   |                   |   | 198,400,329        |            
|Real estateother            |                           |                    | 654,262,301   |                   |   | 404,630,039        |            
|Consumer and other           |                           |                    | 42,206,090    |                   |   | 38,386,805         |            
|                             |                           |                    |               |                   |   |                    |            
|Total loans receivable       |                           |                    | 1,412,634,786 |                   |   | 983,893,564        |            
|Less:                        |                           |                    |               |                   |   |                    |            
|                             | Purchase discount         |                    |               | (86,369           | ) |                    | (109,273   
|                             | Deferred net loan fees    |                    |               | (548,369          | ) |                    | (1,233,812 
|                             | Unearned income           |                    |               | (49,430           | ) |                    | (64,032    
|                             | Allowance for loan losses |                    |               | (20,765,376       | ) |                    | (14,588,582
|                             |                           |                    |               |                   |   |                    |            
|Loans, net                   |                           | $                  | 1,391,185,242 |                   | $ | 967,897,865        |            
|                             |                           |                    |               |                   |   |                    |            
|Mortgage loans held for sale |                           | $                  | 6,490,437     |                   | $ | 8,175,522          |            
|                             |                           |                    |               |                   |   |                    |            
|Commercial and industrial    |                           |                    | 8.53          | %                 |   | 10.58              | %          
|Real estate construction     |                           |                    | 23.57         | %                 |   | 24.23              | %          
|Residential mortgage         |                           |                    | 18.60         | %                 |   | 20.16              | %          
|Real estateother            |                           |                    | 46.32         | %                 |   | 41.13              | %          
|Consumer and other           |                           |                    | 2.98          | %                 |   | 3.90               | %          
|                             |                           |                    |               |                   |   |                    |            
|Total loans receivable       |                           |                    | 100.00        | %                 |   | 100.00             | %          
|                             |                           |                    |               |                   |   |                    |            



The Company has elected to follow Accounting Principles Board Opinion No. 25 "Accounting for Stock issued to Employees" (APB 25) and related
interpretations in accounting for its employee stock options. Under APB 25, because the exercise price of the Company's employee stock options equals the market price of the underlying stock on the
date of grant, no compensation expense is recognized.

Statement
of Financial Accounting Standards (SFAS) No. 123, "Accounting for Stock-Based Compensation", as amended by SFAS No.148, requires pro forma disclosures of net income and
earnings per share for companies not adopting its fair value accounting method for stock-based employee compensation. The pro-forma disclosure below use the fair value method of
SFAS 123 to measure compensation expense for stock-based employee compensation plans. Because the Company's employee stock options have characteristics significantly different from those of
traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in

10

---

management's
opinion, the existing model does not necessarily provide a reliable single measure of the fair value of its employee stock options.

Three months ended
September 30, 2003

Nine months ended
September 30, 2003Net income

$
7,118,156

$
19,252,623EPSBasic


0.38


1.10EPSDiluted


0.36


1.06Compensation costFV


240,258


719,452Less: Tax Effect


(81,693
)

(244,630
)Net compensation costsFV


158,565


474,822Net Income, Pro-forma


6,959,591


18,777,801EPSBasic


0.37


1.07EPSDiluted


0.36


1.03


11

---





The following is management's discussion and analysis of certain significant factors which have affected the Company's financial position at September 30,
2003 as compared to December 31, 2002 and operating results for the three and nine month periods ended September 30, 2003 as compared to the three and nine month periods ended
September 30, 2002. These comments should be read in conjunction with the Company's unaudited consolidated financial statements and accompanying notes appearing elsewhere herein.



The foregoing materials and management's discussion of them may contain, among other things, certain forward-looking statements with respect to Main Street
Banks, Inc. ("the Company"), as well as the goals, plans, objectives, intentions, expectations, financial condition, results of operations, future performance and business of the Company,
including, without limitation, (i) statements relating to certain of the Company's goals and expectations with respect to earnings, earnings per share, revenue, expenses, and the growth rate in
such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, (ii) statements relating to the benefits of the merger
between the former First Colony Bancshares, Inc. and the Company (the "Merger"), completed on May 22, 2003, including future financial and operating results, cost savings, enhanced
revenues and the accretion of reported earnings that may be realized from the Merger, and (iii) statements preceded by, followed by or that include the words "may," "could," would," "should,"
"believes," "expects," "anticipates," "estimates," "intends," "plans," "targets," "probably," "potentially," "projects," "outlook" or similar expressions. These forward-looking statements involve
certain risks and uncertainties that are subject to change based on various factors (many of which are beyond the Company's control). The following factors, among others, could cause the Company's
financial performance to differ materially from the goals, plans, objectives, intentions and expectations expressed in such forward-looking statements: (1) the risk that the businesses involved
in the Merger will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected; (2) expected revenue synergies and cost savings
from the Merger may not be fully realized or realized within the expected time frame; (3) revenues following the Merger may be lower than expected; (4) deposit attrition, operating
costs, customer loss and business disruption following the Merger, including, without limitation, difficulties in maintaining relationships with employees, may be greater than expected; (5) the
strength of the United States economy in general and the strength of the local economies in which the Company conducts operations may be different than expected resulting in, among other things, a
deterioration in credit quality or a
reduced demand for credit, including the resultant effect on the Company's loan portfolio and allowance for loan losses; (6) the effects of, and changes in, trade, monetary and fiscal policies
and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; (7) inflation, interest rate, market and monetary fluctuations; (8) adverse changes in
the financial performance and/or condition of the Company's borrowers which could impact the repayment of such borrowers' outstanding loans; and (9) the impact on the Company's businesses, as
well as on the risks set forth above, of various domestic or international military or terrorists activities or conflicts. Additional information with respect to factors that may cause actual results
to differ materially from those contemplated by such forward-looking statements is included in the reports filed by the Company with the Securities and Exchange Commission.

The
Company cautions that the foregoing list of factors is not exclusive. All subsequent written and oral forward-looking statements concerning the Merger or other matters and
attributable to the Company or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. The Company does not undertake any obligation to update any
forward-looking statement, whether written or oral.

12

---

This
Form 10-Q contains financial information determined by methods other than in accordance with Generally Accepted Accounting Principles ("GAAP"). The Company's
management uses these non-GAAP measures in their analysis of the Company's performance. These measures adjust GAAP performance to exclude the effects of the amortization of intangibles in
the determination of "cash basis" performance measures. These non-GAAP measures may also exclude other significant gains, losses or expenses that are unusual in nature and not expected to
recur. Since these items and their impact on The Company's performance are difficult to predict, management believes presentations of financial measures excluding the impact of these items provide
useful supplemental information that is important to a proper understanding of the operating results of The Company's core businesses. These disclosures should not be viewed as a substitute for
results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.



The Company's total assets increased $592.1 million or 38.29% since December 2002, due primarily to the acquisition of First Colony as noted in
Note 2 to the unaudited financial statements included under Item 1 to this report. Federal funds sold decreased $38.7 million primarily due to an increase in loan demand. Loans increased
43.73% or $423.3 million since December 2002, while the investment portfolio increased $52.8 million. Both increases are due primarily to the First Colony acquisition. Goodwill
increased by $78.5 million, also as a result of the First Colony acquisition. Total deposits increased by 27.35% or $308.7 million due primarily to the First Colony acquisition, an
ongoing deposit campaign, limited use of brokered and national deposits, and seasonal public funds.

Return
on average equity for the three and nine months ended September 30, 2003 was 14.9% on average equity of $189.6 million, and 16.2% on average equity of
$159.2 million, respectively. This compares to 18.3% on average equity of $113.4 million, and 18.30% on average equity of $109.5 million for the same periods in 2002.

Return
on average assets for the three and nine months ended September 30, 2003 was 1.51% and 1.59%, respectively. This compares to 1.72% and 1.72% for the same periods in 2002.

MAIN STREET BANKS, INC. AND SUBSIDIARIES
OPERATING INCOME CALCULATION
(Unaudited)

|                                            |  | Three months ended
September 30, |           | Nine months ended
September 30, |  
|------------------------------------------- |  | -------------------------------- | --------- | ------------------------------- | -
|
|Income                                      |  | $                                | 7,118,156 |                                 | $
|Amortization of intangible assets (net)     |  |                                  | 70,454    |                                 |  
|                                            |  |                                  |           |                                 |  
|Operating Income                            |  | $                                | 7,188,610 |                                 | $
|Basic                                       |  | $                                | 0.38      |                                 | $
|Diluted                                     |  | $                                | 0.37      |                                 | $
|Average tangible assets (in thousands)      |  | $                                | 1,774,814 |                                 | $
|Average tangible equity (in thousands)      |  | $                                | 94,647    |                                 | $
|Operating return on average tangible assets |  |                                  | 1.61      | %                               |  
|Operating return on average tangible equity |  |                                  | 30.13     | %                               |  

13

---

|                                                                         |         | Three months ended
September 30, |            | Nine months ended
September 30, |  
|------------------------------------------------------------------------ | ------- | -------------------------------- | ---------- | ------------------------------- | -
|
|Net interest income                                                      |         |                                  | 18,765,035 |                                 |  
|Net interest income (tax equivalent)                                     |         |                                  | 19,036,194 |                                 |  
|Provision for loan losses                                                |         |                                  | 1,146,000  |                                 |  
|Non-interest income                                                      |         |                                  | 6,535,781  |                                 |  
|Non-interest expense                                                     |         |                                  | 14,368,104 |                                 |  
|Net income                                                               |         |                                  | 7,118,156  |                                 |  
|
|Loans, net of unearned income                                            |         | $                                | 1,389,998  |                                 | $
|Investment securities                                                    |         |                                  | 249,175    |                                 |  
|Total assets                                                             |         |                                  | 1,869,759  |                                 |  
|Deposits                                                                 |         |                                  | 1,423,029  |                                 |  
|Shareholders' equity                                                     |         |                                  | 189,592    |                                 |  
|
|Earnings per shareBasic                                                 |         | $                                | 0.38       |                                 | $
|Earning per shareDiluted                                                |         | $                                | 0.36       |                                 | $
|Book value per share at end of period                                    |         | $                                | 10.25      |                                 | $
|End of period shares outstanding                                         |         |                                  | 18,933,178 |                                 |  
|Weighted average shares outstanding                                      |         |                                  |            |                                 |  
|                                                                         | Basic   |                                  |            | 18,913,088                      |  
|                                                                         | Diluted |                                  |            | 19,602,219                      |  
|
|Market Price:                                                            |         |                                  |            |                                 |  
|                                                                         | Closing |                                  | $          | 25.02                           |  
|                                                                         | High    |                                  |            | 26.00                           |  
|                                                                         | Low     |                                  |            | 23.37                           |  
|Trading volume                                                           |         |                                  | 1,022,400  |                                 |  
|Cash dividneds per share                                                 |         | $                                | 0.120      |                                 | $
|Dividend payout ratio                                                    |         |                                  | 33.05      | %                               |  
|Price to earnings                                                        |         | $                                | 17.37      |                                 | $
|Price to book value                                                      |         |                                  | 2.44       |                                 |  
|
|Return on average assets                                                 |         |                                  | 1.51       | %                               |  
|Return on average equity                                                 |         |                                  | 14.90      | %                               |  
|Average loans as percentage of average deposits                          |         |                                  | 97.7       | %                               |  
|Net interest margin (tax equivalent)                                     |         |                                  | 4.55       | %                               |  
|Average equity to average assets                                         |         |                                  | 10.14      | %                               |  
|Efficiency ratio                                                         |         |                                  | 56.79      | %                               |  
|
|Total non-performing assets                                              |         |                                  | 12,221,400 |                                 |  
|Non-performing assets as a percentage of loans plus foreclosed assets    |         |                                  | 0.86       | %                               |  
|Net annualized charge-offs (recoveries) as a percentage of average loans |         |                                  | 0.19       | %                               |  
|Reserve for loan losses as a percentage of loans, at end of period       |         |                                  | 1.47       | %                               |  

14

---



Capital

At September 30, 2003, the capital ratios of the Company and Main Street Bank (the "Bank") were adequate based on regulatory minimum capital requirements.
The minimum capital requirements for banks and bank holding companies require a leverage capital to total assets ratio of at least 4%, core capital to risk-weighted assets ratio of at
least 4% and total capital to risk-weighted assets of 8%. The following table reflects the Company's and the Bank's compliance with regulatory capital requirements at September 30,
2003.

Company

Bank

Minimum
Required

Well
CapitalizedLeverage ratio

7.26
%
7.75
%
4.00
%
5.00
%Risk based capital ratios:Tier 1 risk based capital

8.62
%
9.16
%
4.00
%
6.00
%Risk-based capital

11.06
%
10.41
%
8.00
%
10.00
%


Loans and Allowance for Loan Losses

At September 30, 2003, loans, net of unearned income, were $1.4 billion, an increase of $423.3 million or 43.7% over net loans at
December 31, 2002 of $967.9 million. The growth in the loan portfolio was attributable to the impact of the First Colony acquisition, as well as a consistent focus on quality loan
production and strong loan markets in the state. Residential mortgage and commercial real estate loans increased $313.9 million or 52.06% from December 31, 2002 while real estate
construction loans increased $94.6 million or 39.66% over the same period. The Company continues to monitor the composition of the loan portfolio to ensure that the market risk to the balance
sheet is not adversely affected by the impact of changes in the economic environment on any one segment of the portfolio.

The
Company primarily focuses on the following loan categories: (1) commercial and industrial, (2) real estate construction, (3) residential mortgage,
(4) commercial real estate, and (5) consumer loans. The Company's management has strategically located its branches in high growth markets and has taken advantage of a surge in
residential and industrial growth in northeastern Georgia.

The
allowance for loan losses is a reserve established through charges to earnings in the form of a provision for loan losses. The provision for loan losses is based on management's
evaluation of the size and composition of the loan portfolio, the level of non-performing and past due loans, historical trends of charged-off loans and recoveries, prevailing
economic conditions and other factors management deems appropriate. The Company's management has established an allowance for loan losses which it believes is adequate for probable losses in the loan
portfolio. Based on a credit evaluation of the loan portfolio, management presents a quarterly review of the allowance for loan losses to the Company's Board of Directors. The review that management
has developed primarily focuses on risk by evaluating the level of loans in certain risk categories. These categories have also been established by management and take the form of loan grades. These
loan grades closely mirror regulatory classification guidelines and include pass loan categories 1 through 4 and special mention, substandard, doubtful, and loss categories of 5 through 8,
respectively. By grading the loan portfolio in this manner the Company's management is able to effectively evaluate the portfolio by risk, which management believes is the most effective way to
analyze the loan portfolio and thus analyze the adequacy of the allowance for loan losses. Management also reviews charge-offs and recoveries on a quarterly basis to identify trends.

The
Company's risk management processes include a loan review program to evaluate the credit risk in the loan portfolio. The credit review department is independent of the loan function
and reports to the Executive Vice President of Risk Management. Through the loan review process, the Company maintains an internally criticized classified loan watch list which, along with the
delinquency report of loans, serves as a tool to assist management in assessing the overall quality of the loan portfolio and the adequacy of the allowance for loan losses. Loans classified as
"substandard" are those loans with

15

---

clear
and defined weaknesses such as a highly leveraged position, unfavorable financial ratios, uncertain financial ratios, uncertain repayment sources, deterioration in underlying collateral values,
or poor financial condition which may jeopardize recoverability of the debt. Loans classified as "doubtful" are those loans that have characteristics similar to substandard loans but have an increased
risk of loss, or at least a portion of the loan may require being charged-off. Loans classified as "loss" are those loans that are in the process of being charged-off.

For
the nine month period ending September 30, 2003, net charge-offs totaled $2.1 million or .23% (annualized) of average loans outstanding for the period, net
of unearned income, compared to $1.6 million or .25% in net charge-offs for the same period in 2002. The provision for loan losses for the nine months ended September 30,
2003 was $4.0 million compared to $2.3 million for the same period in 2002. The allowance for loan losses totaled $20.8 million or 1.47% of total loans, net of unearned income at
September 30, 2003, compared to $14.6 million or 1.48% of total loans at December 31, 2002.

The
following table presents an analysis of the allowance for loan losses for the nine-month periods ended September 30, 2003 and 2002:

Nine Months Ended
September 30,2003

2002Balance of allowance for loan losses at beginning of period

$
14,588,582

$
12,017,448Provision charged to operating expenses


3,994,000


2,276,000Additional reserves assumed in First Colony acquisition


4,272,738


Charge-offs:Commercial, financial and agricultural


1,344,441


644,066Real estateconstruction and land development


207,932


252,592Real estatemortgage





Installment and other consumer


846,468


883,689Total charge-offs


2,398,841


1,780,347Recoveries:Commercial, financial and agricultural


57,664


14,672Real estateconstruction and land development


50,768


3,081Real estatemortgage





Installment and other consumer


200,465


153,795Total recoveries


308,897


171,548Net charge-offs


2,089,944


1,608,799Balance of allowance for loan losses at end of period

$
20,765,376

$
12,684,649


Interest Rate Sensitivity and Liquidity



The Company's primary market risk exposures are credit (as discussed previously), interest rate risk and to a lesser degree, liquidity risk. The Bank operates
under an Asset Liability and Risk Management policy approved by the Board of Directors of the Bank through the Asset and Liability Committee ("ALCO"). The policy outlines limits on interest rate risk
in terms of changes in net interest income and changes in the net market values of assets and liabilities over certain changes in interest rate environments. These measurements are made through a
simulation model which projects the impact of changes in interest rates on the Bank's assets and liabilities. The policy also outlines

16

---

responsibility
for monitoring interest rate risk, and the process for the approval, implementation and monitoring of interest rate risk strategies to achieve the Bank's interest rate risk objectives.

The
Bank's ALCO is comprised of senior officers of the Bank. The ALCO makes all tactical and strategic decisions with respect to the sources and uses of funds that may affect net
interest income, including net interest spread and net interest margin. The ALCO's decisions are based upon policies established by the Bank's Board of Directors, which are designed to meet three
goals: manage interest rate risk, improve interest rate spread and maintain adequate liquidity.

The
ALCO has developed a program of action which includes, among other things, the following: (i) selling substantially all conforming, long-term, fixed rate mortgage
originations, (ii) originating and retaining for the portfolio shorter term, higher yielding loan products which meet the Company's underwriting criteria; and (iii) actively managing the
Company's interest rate risk exposure.



The normal course of business activity exposes the Company to interest rate risk. Interest rate risk is managed within an overall asset and liability framework
for the Company. The principal objectives of asset and liability management are to guide the sensitivity of net interest spreads to potential changes in interest rates and enhance profitability in
ways that promise sufficient reward for recognized and controlled risk. Funding positions are kept within predetermined limits designed to ensure that risk-taking is not excessive and that
liquidity is properly managed. The Company employs sensitivity analysis in the form of a net interest income simulation to help characterize the market risk arising from changes in interest rates. In
addition, fluctuations in interest rates usually result in changes in the fair market value of the Company's financial instruments, cash flows and net interest income. The Company's interest rate risk
position is managed by ALCO. ALCO's objective is
to optimize the Company's financial position, liquidity and net interest income, while remaining within the Board of Director's approved limits.

The
Company uses a simulation modeling process to measure interest rate risk and evaluate potential strategies. The Company's net interest income simulation includes all financial assets
and liabilities. This simulation measures both the term risk and basis risk in the Company's assets and liabilities. The simulation also captures the option characteristics of products, such as caps
and floors on floating rate loans, the right to pre-pay mortgage loans without penalty and the ability of customers to withdraw deposits on demand. These options are modeled through the
use of primarily historical customer behavior and statistical analysis. Other interest rate-related risks such as prepayment, basis and option risk are also considered. Simulation results
quantify interest risk under various interest rate scenarios. Management then develops and implements appropriate strategies. The Board of Directors regularly reviews the overall rate risk position
and asset and liability management strategies.

The
Company uses three standard scenariosrates unchanged, rising rates, and declining ratesin analyzing interest rate sensitivity. The rising and declining rate
scenarios cover a 100 basis points upward and downward rate shock. The following table illustrates the expected effect a given interest rate shift would have on the fair market value of the Balance
Sheet and the annualized projected net interest income of the Company as of September 30, 2003.

Change in Interest Rates

Increase/(Decrease) in
FMV of Balance Sheet

Increase/(Decrease) in
Net Interest Income+ 100 basis points

3.331
%
2.455
%-100 basis points

-4.477
%
0.318
%


These
simulated computations should not be relied upon as indicative of actual future results. Further, the computations do not contemplate certain actions that management may undertake
in response to future changes in interest rates.

17

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Statement of Financial Accounting Standards No. 133,Accounting for Derivative Instruments and Hedging
Activities(SFAS 133) and SFAS 149, as amended and interpreted, establishes accounting and reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts, and for hedging activities. As required by SFAS 133, the Company records all derivatives on the balance sheet at fair value. The accounting
for changes in the fair value of derivatives depends on the intended use of the derivative and the resulting designation. Derivatives used to hedge the exposure to changes in the fair value of an
asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives used to hedge the exposure to variability in expected
future cash flows, or other types of forecasted transactions, are considered cash flow hedges.

The
Company's objective in using derivatives is to add stability to interest income and/or interest expense and to manage its exposure to interest rate movements or other identified
risks. To accomplish this objective, the Company primarily uses interest rate swaps as part of its cash flow hedging strategy. Interest rate swaps designated as cash flow hedges involve the receipt of
fixed-rate amounts in exchange for variable-rate payments, over the life of the agreements without exchange of the underlying principal amount.

The
following chart illustrates the Bank's derivative positions as of September 30, 2003.

Main Street Bank
Derivative Positions
As of September 30, 2003

Interest Rate Swaps

|Type                                 |                            | Transaction
Date |  | Term
Date |  | Notional |             | Pay
Rate    |      | Receive
Rate |      | Current
Spread |      | Market
Value
|------------------------------------ | -------------------------- | ---------------- |  | --------- |  | -------- | ----------- | ----------- | ---- | ------------ | ---- | -------------- | ---- | ------------
|Received Fixed Prime Swapamortizing |                            | Apr-02           |  | Apr-04    |  | $        | 15,000,000  |             | 4.00 | %            | 6.63 | %              | 2.63 | %           
|                                     |                            | Apr-02           |  | Apr-04    |  | $        | 20,000,000  |             |      |              |      |                |      |             
|Received Fixed Prime Swap            |                            | Mar-03           |  | Mar-06    |  | $        | 50,000,000  |             | 4.00 | %            | 5.26 | %              | 1.26 | %           
|Received Fixed Prime Swap            |                            | Aug-03           |  | Aug-06    |  | $        | 100,000,000 |             | 4.00 | %            | 5.59 | %              | 1.59 | %           
|                                     |                            |                  |  |           |  |          |             |             |      |              |      |                |      |             
|                                     | Total Received Fixed Swaps |                  |  |           |  |          | $           | 185,000,000 |      |              |      |                |      |             

Interest Rate Floors

|Type                       |                            | Transaction
Date |  | Term
Date |  | Notional |             | Strike
Rate |      | Current
Rate |      | Current
Spread |       | Market
Value
|-------------------------- | -------------------------- | ---------------- |  | --------- |  | -------- | ----------- | ----------- | ---- | ------------ | ---- | -------------- | ----- | ------------
|Prime based Floor          |                            | Jun-03           |  | Jun-05    |  | $        | 100,000,000 |             | 3.75 | %            | 4.00 | %              | -0.25 | %           
|                           |                            |                  |  |           |  |          |             |             |      |              |      |                |       |             
|                           | Total Interest Rate Floors |                  |  |           |  |          | $           | 100,000,000 |      |              |      |                |       |             
|                           |                            |                  |  |           |  |          |             |             |      |              |      |                |       |             
|Total Derivative Positions |                            |                  |  |           |  | $        | 285,000,000 |             |      |              |      |                |       |             
|                           |                            |                  |  |           |  |          |             |             |      |              |      |                |       |             



Liquidity involves the Company's ability to raise funds to support asset growth or reduce assets to meet deposit withdrawals and other payment obligations, to
maintain reserve requirements and otherwise to operate on an ongoing basis. During the past three years, the Company's liquidity needs have primarily been met by growth in core deposits, advances from
the Federal Home Loan Bank of Atlanta ("FHLB") and raising capital. The Company's cash and Federal funds sold and cash flows from amortizing investment and loan portfolios have generally created an
adequate liquidity position. ALCO

18

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reviews
liquidity monthly. This review is from a regulatory as well as static and a four-quarter forecasted standpoint.

Management
believes the Company has sufficient liquidity to meet all reasonable borrower, depositor, and creditor needs in the present economic environment. In addition, the Bank has
access to the FHLB for borrowing purposes. The Company has not received any recommendations from regulatory authorities that would materially affect liquidity, capital resources or operations.

On
May 22, 2003, Main Street Banks, Inc. completed the sale of $45.0 million of Main Street Banks Statutory Trust II floating rate trust preferred securities
("Capital Securities") with a maturity date of June 30, 2033 and a stated liquidation amount of $1,000 per Capital Security. Interest on the Capital Securities is to be paid on the last day of
each March, June, September, and December and is reset quarterly based on the three month London interbank offered rate ("3-Month LIBOR") plus 325 basis points at the end of the preceding
quarter, provided, however, that prior to May 22, 2008, the 3-Month LIBOR shall not exceed 8.75%. Main Street Banks, Inc. used the proceeds from this offering to fund a
portion of the price paid to acquire First Colony Bancshares, Inc., Alpharetta, Georgia.

Results of Operations for the Three Months Ended September 30, 2003 and 2002



Interest income for the three months ended September 30, 2003 was $26.3 million, an increase of $6.4 million, or 32.1% compared to
$19.9 million for the same period in 2002. The increase is mainly attributable to net loan growth of $543.6 million from September 30, 2002 to September 30, 2003. Interest
on federal funds sold decreased $.4 million, due to the Company's decision to use the funds to purchase investment securities to earn a higher yield. Average earning assets for the three month
period increased $556.6 million to $1.7 billion as of September 30, 2003 compared to $1.1 billion as of September 30, 2002.



Interest expense on deposits and other borrowings for the three months ended September 30, 2003 was $7.5 million, a $1.6 million, or 25.88%
increase from September 30, 2002. While average interest bearing liabilities increased $584.3 million to $1.7 billion for the three months ended September 30, 2003 compared
to $1.1 billion for the three months ended September 30, 2002, the yield on average interest bearing liabilities decreased 40 basis points to 1.80% from 2.20% as of September 30,
2003 and 2002, respectively.



Net interest income for the three months ended September 30, 2003 increased $4.9 million, or 34.73% to $18.8 million compared to
$14.2 million for the same period ending September 30, 2002. The increase was mainly attributable to the acquisition of First Colony in May 2003, as well as the Company's ability
to manage the effects of the Federal Reserve's rate reductions. The Company's net interest margin decreased to 4.55% for the three months ended September 30, 2003 compared to 5.19% as of
September 30, 2002.



The provision for loan losses was $1.1million for the three months ended September 30, 2003 as compared to $.2 million for the three months ended
September 30, 2002. The increase in the provision for loan losses was attributable to loan growth. Management believes that the present allowance for loan losses is adequate.

19

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Non-interest income was $6.5 million for the three months ended September 30, 2003 an increase of $1.2 million, or 22.90%
compared to $5.3 million for the three months ended September 30, 2002. The major components of the increase were insurance agency income, income from SBA lending, and mortgage banking
income. Insurance agency income increased $0.1 million, or 3.76% to $1.2 million from $1.1 million for the three months ended September 30, 2003 and 2002, respectively.
Income from SBA lending increased $0.2 million, or 164.3% to $0.4 million from $0.2 million for the three months ended September 30, 2003 and 2002, respectively. Mortgage
banking income increased $0.4 million, or 57.37% to $1.1 million from $0.7 million for the three months ended September 30, 2003 and 2002, respectively. Gains on sales of
investment securities of $0.3 million was recognized for the three months ended September 30, 2003, compared to $0 for the three month period ended September 30, 2002.



Non-interest expense increased $2.9 million or 24.52% to $14.4 million from $11.5 million for the three months ended
September 30, 2003 and 2002, respectively. The increase was attributable to the impact of the First Colony acquisition as well as to additional personnel required to accommodate the Company's
growth. Salaries were $6.8 million, an increase of $1.3 million, or 23.39% from the three months ended September 30, 2002. The Company's efficiency ratio was 56.8% for the three
months ended September 30, 2003 compared to 60.0% for the three months ended September 30, 2002.



The amount of income tax expense is influenced by the amount of taxable income, the amount of tax-exempt income, the amount of nondeductible interest
expense, and the amount of other nondeductible expenses. For the three months ended September 30, 2003, the provision for taxes was $2.7 million, an increase of $0.4 million from
the $2.3 million provided for in the same period in 2002. The effective tax rate for the three months ended September 30, 2003 was 27.27% compared to 30.37% for the same period in 2002.
The effective tax rate for the three months ending September 30, 2003 is lower than for the same period in 2002 due to the effects of acquisitions on tax provisions and an over accrual of
income tax provision for prior period. The over accrual of income tax provision is expected to effect the tax rate for the remainder of 2003.

Results of Operations for the Nine Months Ended September 30, 2003 and 2002



Interest income for the nine months ended September 30, 2003 was $72.0 million, an increase of $13.5 million, or 23.78% compared to
$58.5 million for the nine months ended September 30, 2002. Interest and fees on loans increased $13.1 million to $64.1 million for the nine months ended
September 30, 2003 compared to $51.0 million for the same period in 2002. Interest on investment securities increased $0.8 million to $6.2 million from $5.4 million
for the nine months ended September 30, 2003 and 2002, respectively. These increases are due to increased asset balances, mainly attributable to the First Colony acquisition. Average earning
assets increased $397.2 million to $1.5 billion for the nine months ended September 30, 2003 compared to $1.1 billion for the same period ended September 30, 2002.
Yield on average earning assets decreased 76 basis points to 6.64% from 7.40% for the nine months ended September 30, 2003 and 2002, respectively.



Interest expense on deposits and other borrowings for the nine months ended September 30, 2003 was $20.0 million, a $1.4 million, or 7.69%
increase from the same period ending September 30, 2002. The increase was attributable to the yield on average interest bearing liabilities decreasing 53 basis

20

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points
to 1.84% from 2.37% for the nine months ended September 30, 2003 and September 30, 2002, respectively. Average interest bearing liabilities increased $402.7 million to
$1.4 million for the nine months ended September 30, 2003 compared to $1.0 million for the nine months ended September 30, 2002.



Net interest income for the nine months ended September 30, 2003 increased $10.7 million, or 27.02% to $52.0 million compared to
$39.6 million for the same period ending September 30, 2002. The increase was mainly attributable to the Company's ability to manage the effects of the Federal Reserve's aggressive rate
reductions. The Company's net interest margin decreased to 4.82% for the nine months ended September 30, 2003 compared to 5.09% as of September 30, 2002.



The provision for loan losses was $4.0 million for the nine months ended September 30, 2003 as compared to $2.3 million for the same period
ending September 30, 2002. The increase in the provision for loan losses was attributable to loan growth. Management believes that the present allowance for loan losses is adequate considering
the Company's historical loss experience.



Non-interest income was $17.4 million for the nine months ended September 30, 2003; an increase of $3.2 million, or 22.93%
compared to $14.2 million for the nine months ended September 30, 2002. The components of the increase were insurance agency income, mortgage banking income, income from SBA lending, and
investment securities gains. Insurance agency income increased
$0.8 million, or 27.74% to $3.6 million from $2.8 million for the nine months ended September 30, 2003 and 2002, respectively. Mortgage banking income increased
$0.8 million, or 50.08% to $2.6 million from $1.8 million for the nine months ended September 30, 2003 and 2002, respectively. Income from SBA lending increased
$0.7 million, or 105.20% to $1.3 million from $0.6 million for the nine months ended September 30, 2003 and 2002, respectively. Gains on sales of investment securities of
$0.6 million were recognized for the nine months ended September 30, 2003, compared to $0 for the nine month period ended September 30, 2002.



Non-interest expense increased $8.3 million or 27.80% to $38.3 million from $30.0 million for the nine months ended
September 30, 2002 and 2001, respectively. The increase was attributable to the impact of the First Colony acquisition as well as to additional personnel required to accommodate the Company's
growth. Salaries and other compensation were $18.6 million, an increase of $3.8 million, or 26.01% from the nine months ended September 30, 2002. The Company's efficiency ratio
was 55.14% for the nine months ended September 30, 2003 compared to 55.70% for the nine months ended September 30, 2002.



The amount of income tax expense is influenced by the amount of taxable income, the amount of tax-exempt income, the amount of nondeductible interest
expense, and the amount of other nondeductible expenses. For the nine months ended September 30, 2003, the provision for taxes was $7.9 million, an increase of $1.3 million from
the $6.6 million provided for in the same period in 2002. The effective tax rate for the nine months ended September 30, 2003 was 29.16% compared to 30.49% for the same period in 2002.
The effective tax rate for the nine months ending September 30, 2003 is lower than the same period in 2002 due to the effects of acquisitions on tax provisions and an over

21

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accrual
of income tax provision from prior periods. The over accrual of income tax provision is expected to effect the tax rate for the remainder of 2003.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company's primary market risk exposures are credit (as discussed previously), interest rate risk and to a lesser degree, liquidity risk. The Bank operates
under an Asset Liability and Risk Management policy approved by the Board of Directors of the Bank through the Asset and Liability Committee ("ALCO"). The policy outlines limits on interest rate risk
in terms of changes in net interest income and changes in the net market values of assets and liabilities over certain changes in interest rate environments. These measurements are made through a
simulation model which projects the impact of changes in interest rates on the Bank's assets and liabilities. The policy also outlines responsibility for monitoring interest rate risk, and the process
for the approval, implementation and monitoring of interest rate risk strategies to achieve the Bank's interest rate risk objectives.

The
Bank's ALCO is comprised of senior officers of the Bank. The ALCO makes all tactical and strategic decisions with respect to the sources and uses of funds that may affect net
interest income, including net interest spread and net interest margin. The ALCO's decisions are based upon policies established by the Bank's Board of Directors, which are designed to meet three
goals: manage interest rate risk, improve interest rate spread and maintain adequate liquidity.

The
ALCO has developed a program of action which includes, among other things, the following: (i) selling substantially all conforming, long-term, fixed rate mortgage
originations, (ii) originating and retaining for the portfolio shorter term, higher yielding loan products which meet the Company's underwriting criteria; and (iii) actively managing the
Company's interest rate risk exposure.

Additional
information required by Item 305 of Regulation S-K is set forth under Item 2 of this report.

ITEM 4. CONTROLS AND PROCEDURES

Our Chief Executive Officer and Chief Financial Officer have evaluated the Company's disclosure controls and procedures as of the end of the quarterly period
covered by this Form 10-Q and have concluded that the Company's disclosure controls and procedures were effective as of that date in ensuring that information required to be
disclosed in this Quarterly Report on Form 10-Q was recorded, processed, summarized, and reported within the time period required by the SEC's rules and forms. During the third
quarter of 2003 there were no changes in the Company's internal control over financial reporting that may have materially affected, or that are reasonably likely to materially affect, the Company's
internal control over financial reporting.

22

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PART II.OTHER INFORMATION



From time to time, the Bank is a party to legal proceedings in the ordinary course of business, wherein it enforces its security interest.
The
Company has established necessary and sufficient reserves to cover such anticipated expenses. The Company and the Bank are not engaged in any legal proceedings of a material nature at the present
time.



None.



None.



None.



None.



Exhibit
No.

Description3.1

Articles of Incorporation of Main Street Bank, Inc. (incorporated by reference to Exhibit 3.1 to Registration Statement No. 33-78046 on Form S-4) as amended by Certificate of Merger and Name Change (incorporated by
reference to Exhibit 3.1 of the December 31, 1996, Form 10-KSB)3.2

Bylaws of Main Street Bank, Inc. (incorporated by reference to Exhibit 3.2 to Registration Statement No. 33-78046 on Form S-4)31.1

Certificate of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2

Certificate of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1

Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2

Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


23

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July 3, 2003

Press release announcing the date of the Company's conference call to release the results of the second quarter of 2003.July 10, 2003

Press release announcing a dividend declaration.July 16, 2003

Press release announcing the results of the third quarter of 2003.July 31, 2003

Presentation of the text of slides provided to the investment communitySeptember 23, 2003

Press release announcing that Main Street Bank will present at SunTrust Robinson Humphrey's 2003 Sunbelt Community Banking Conference on Sept. 30.


24

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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

|      |  |                   |  |  |  | MAIN STREET BANKS, INC.                                 
|----- |  | ----------------- |  |  |  | --------------------------------------------------------
|Date: |  | November 14, 2003 |  |  |  | By:                                                     
|      |  |                   |  |  |  | Edward C. Milligan, Chairman and
Chief Executive Officer
|Date: |  | November 14, 2003 |  |  |  | By:                                                     
|      |  |                   |  |  |  | Robert D. McDermott, Chief Financial Officer            

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