| For Quarterly Period Ended March 31, 2011 | Commission File No. 000-29640 |
|-------------------------------------------|-------------------------------|

| South Carolina                  |   | 58-2322486                        |
|---------------------------------|--------|-----------------------------------|
| (State or other jurisdiction of |   | (IRS Employer Identification No.) |
| incorporation or organization)  |   |                              |

| Large accelerated filer                                         [   ]           | Accelerated filer                                                     [   ] |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                |
| Non-accelerated filer                                           [   ] | Smaller reporting company                                   [X]                                                                                                                      |
| (Do not check if a smaller reporting company)                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                |

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|                                                                                                                                                                                                                                   | Page   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| PART I –                 FINANCIAL INFORMATION                                                                                              |   |
|                                                                                                                                                                                                                                   |   |
| Item 1.                      Financial Statements                                                                        |   |
|                                                                                                                                                                                                                                   |   |
|   Consolidated Balance Sheets                                                                                                                                                                                                     | 3      |
|   Consolidated Statements of Income                                                                                                                                                                                               | 4      |
|   Consolidated Statements of Changes in Shareholders’ Equity                                                                                                                                                                | 5      |
|   Consolidated Statements of Cash Flows                                                                                                                                                                                           | 6      |
|   Notes to Unaudited Consolidated Financial Statements                                                                                                                                                                            | 8      |
|                                                                                                                                                                                                                                   |   |
| Item 2.                      Management’s Discussion and Analysis of Financial Condition and Results of Operations | 21     |
| Item 4.                      Controls and Procedures                                                                     | 28     |
|                                                                                                                                                                                                                                   |   |
| PART II -                OTHER INFORMATION                                                                                                             |   |
|                                                                                                                                                                                                                                   |   |
| Item 6.                      Exhibits                                                                                    | 28     |
|                                                                                                                                                                                                                                   |   |
| SIGNATURE                                                                                                                                                                                                                              | 29     |

----

| PART I – FINANCIAL INFORMATION |
|--------------------------------------|

| Item 1. – Financial Statements |
|--------------------------------------|

| COMMUNITY FIRST BANCORPORATION                                                       |   |                   |    |   |         |   |
|--------------------------------------------------------------------------------------|--------|------------------------|---------|--------|--------------|--------|
| Consolidated Balance Sheets                                                          |   |                   |    |   |         |   |
|                                                                                 |   | (Unaudited)            |    |   |         |   |
|                                                                                 |   | March 31,              |    |   | December 31, |   |
|                                                                                 |   | 2011                   |    |   | 2010         |   |
|                                                                                 |   | (Dollars in thousands) |    |
| Assets                                                                               |   |                   |    |   |         |   |
|    Cash and due from banks                                                 |   | $                      | 1,991   |   |         | $      | 1,711 |   |
|  Interest bearing deposits due from banks                                       |   |                   | 30,797  |   |         |   | 39,171 |   |
| Cash and cash equivalents                                                            |   |                   | 32,788  |   |         |   | 40,882 |   |
|  Securities available-for-sale                                                  |   |                   | 170,953 |   |         |   | 169,369 |   |
|   Securities held-to-maturity (fair value $6,144 for 2011                  |   |                   |    |   |         |   |   |   |
| and $6,817 for 2010)                                                                 |   |                   | 5,746   |   |         |   | 6,389 |   |
|    Other investments                                                       |   |                   | 1,363   |   |         |   | 1,363 |   |
|       Loans                                                 |   |                   | 247,640 |   |         |   | 256,834 |   |
|       Allowance for loan losses                             |   |                   | (5,839  | )      |         |   | (5,756 | ) |
| Loans - net                                                                          |   |                   | 241,801 |   |         |   | 251,078 |   |
|  Premises and equipment - net                                                   |   |                   | 8,082   |   |         |   | 8,170 |   |
|  Accrued interest receivable                                                    |   |                   | 2,393   |   |         |   | 2,491 |   |
|  Bank-owned life insurance                                                      |   |                   | 9,755   |   |         |   | 9,666 |   |
|    Foreclosed assets                                                       |   |                   | 11,505  |   |         |   | 11,395 |   |
|    Other assets                                                            |   |                   | 4,785   |   |         |   | 4,956 |   |
|                                                                                 |   |                   |    |   |         |   |   |   |
| Total assets                                                                         |   | $                      | 489,171 |   |         | $      | 505,759 |   |
|                                                                                 |   |                   |    |   |         |   |   |   |
| Liabilities                                                                          |   |                   |    |   |         |   |   |   |
| Deposits                                                                             |   |                   |    |   |         |   |   |   |
| Noninterest bearing                                                                  |   | $                      | 47,780  |   |         | $      | 46,844 |   |
| Interest bearing                                                                     |   |                   | 386,244 |   |         |   | 398,466 |   |
| Total deposits                                                                       |   |                   | 434,024 |   |         |   | 445,310 |   |
| Accrued interest payable                                                             |   |                   | 1,172   |   |         |   | 1,698 |   |
| Short-term borrowings                                                                |   |                   | -       |   |         |   | 5,000 |   |
| Long-term debt                                                                       |   |                   | 6,500   |   |         |   | 6,500 |   |
| Other liabilities                                                                    |   |                   | 2,182   |   |         |   | 1,939 |   |
| Total liabilities                                                                    |   |                   | 443,878 |   |         |   | 460,447 |   |
|                                                                                 |   |                   |    |   |         |   |   |   |
| Shareholders' equity                                                                 |   |                   |    |   |         |   |   |   |
|   Preferred stock - Series A - non-voting 5% cumulative - $1,000 per share |   |                   |    |   |         |
|     liquidation preference; 5,000 shares authorized;                  |   |                   |    |   |         |   |   |   |
| issued and outstanding - 3,150 shares                                                |   |                   | 3,126   |   |         |   | 3,126 |   |
| Preferred stock - no par value; 9,995,000 shares authorized;                         |   |                   |    |   |         |   |   |   |
| None issued and outstanding                                                          |   |                   | -       |   |         |   | - |   |
| Common stock - no par value; 10,000,000 shares authorized;                           |   |                   |    |   |         |   |   |   |
|    issued and outstanding - 3,972,976 for 2011 and                    |   |                   |    |   |         |   |   |   |
|      3,972,976 for 2010                                     |   |                   | 39,931  |   |         |   | 39,931 |   |
|  Additional paid-in capital                                                     |   |                   | 748     |   |         |   | 748 |   |
|  Retained earnings                                                              |   |                   | 1,532   |   |         |   | 1,396 |   |
| Accumulated other comprehensive (loss) income                                        |   |                   | (44     | )      |         |   | 111 |   |
| Total shareholders' equity                                                           |   |                   | 45,293  |   |         |   | 45,312 |   |
|                                                                                 |   |                   |    |   |         |   |   |   |
| Total liabilities and shareholders' equity                                           |   | $                      | 489,171 |   |         | $      | 505,759 |   |
|                                                                                 |   |                   |    |   |         |   |   |   |
| See accompanying notes to unaudited consolidated financial statements.               |   |                   |    |   |         |   |   |   |

----

| COMMUNITY FIRST BANCORPORATION                                                                                      |   |                                     |   |   |   |   |
|---------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|--------|--------|--------|--------|
| Consolidated Statements of Income                                                                                   |   |                                     |   |   |   |
|                                                                                                                |   | (Unaudited)                              |   |
|                                                                                                                |   | Three Months Ended                       |   |
|                                                                                                                |   | March 31,                                |   |
|                                                                                                                |   | 2011                                     |   |   | 2010   |   |
|                                                                                                                |   | (Dollars in thousands, except per share) |   |
| Interest income                                                                                                     |   |                                     |   |   |   |   |
|  Loans, including fees                                                                                         |   | $                                        | 3,623  |   |   | $      | 4,004 |   |
|     Interest bearing deposits due from banks                                                         |   |                                     | 28     |   |   |   | 38 |   |
|  Securities                                                                                                    |   |                                     |   |   |   |   |   |   |
|             Taxable                                          |   |                                     | 1,124  |   |   |   | 1,285 |   |
|       Tax-exempt                                                                                |   |                                     | 177    |   |   |   | 199 |   |
|  Other investments                                                                                             |   |                                     | 2      |   |   |   | - |   |
| Total interest income                                                                                               |   |                                     | 4,954  |   |   |   | 5,526 |   |
| Interest expense                                                                                                    |   |                                     |   |   |   |   |   |   |
|  Time deposits $100M and over                                                                                  |   |                                     | 562    |   |   |   | 733 |   |
|     Other deposits                                                                                   |   |                                     | 870    |   |   |   | 1,419 |   |
|     Long-term debt                                                                                   |   |                                     | 64     |   |   |   | 76 |   |
| Total interest expense                                                                                              |   |                                     | 1,496  |   |   |   | 2,228 |   |
| Net interest income                                                                                                 |   |                                     | 3,458  |   |   |   | 3,298 |   |
| Provision for loan losses                                                                                           |   |                                     | 1,250  |   |   |   | 1,125 |   |
| Net interest income after provision                                                                                 |   |                                     | 2,208  |   |   |   | 2,173 |   |
| Other income                                                                                                        |   |                                     |   |   |   |   |   |   |
| Service charges on deposit accounts                                                                                 |   |                                     | 260    |   |   |   | 301 |   |
|    Debit card transaction fees                                                                       |   |                                     | 183    |   |   |   | 136 |   |
| Credit life insurance commissions                                                                                   |   |                                     | 1      |   |   |   | 4 |   |
| Increase in value of bank-owned life insurance                                                                      |   |                                     | 89     |   |   |   | 92 |   |
|    Other income                                                                                           |   |                                     | 55     |   |   |   | 3 |   |
| Total other income                                                                                                  |   |                                     | 588    |   |   |   | 536 |   |
| Other expenses                                                                                                      |   |                                     |   |   |   |   |   |   |
| Salaries and employee benefits                                                                                      |   |                                     | 1,220  |   |   |   | 1,119 |   |
|    Net occupancy expense                                                                                  |   |                                     | 139    |   |   |   | 145 |   |
| Furniture and equipment expense                                                                                     |   |                                     | 79     |   |   |   | 90 |   |
| Amortization of computer software                                                                                   |   |                                     | 97     |   |   |   | 112 |   |
|    FDIC insurance expense                                                                                 |   |                                     | 232    |   |   |   | 398 |   |
| Debit card transaction expenses                                                                                     |   |                                     | 116    |   |   |   | 100 |   |
|   Other expense                                                                                           |   |                                     | 704    |   |   |   | 521 |   |
| Total other expenses                                                                                                |   |                                     | 2,587  |   |   |   | 2,485 |   |
| Income before income taxes                                                                                          |   |                                     | 209    |   |   |   | 224 |   |
| Income tax expense                                                                                                  |   |                                     | 34     |   |   |   | 17 |   |
| Net income                                                                                                          |   |                                     | 175    |   |   |   | 207 |   |
| Deductions for amounts not available to common shareholders:                                                        |   |                                     |   |   |   |   |   |   |
| Dividends declared or accumulated on preferred stock                                                                |   |                                     | (59    | )      |   |   | (59 | ) |
| Net income available to common shareholders                                                                         |   | $                                        | 116    |   |   | $      | 148 |   |
|                                                                                                                |   |                                     |   |   |   |   |   |   |
| Per common share*                                                                                                   |   |                                     |   |   |   |   |   |   |
| Net income                                                                                                          |   | $                                        | 0.03   |   |   | $      | 0.04 |   |
| Net income, assuming dilution                                                                                       |   |                                     | 0.03   |   |   |   | 0.04 |   |
| __________________                                                                                                  |   |                                     |   |   |   |   |   |   |
| * Per share information has been retroactively adjusted to reflect a 5% stock dividend effective December 16, 2010. |   |                                     |   |   |   |
|                                                                                                                |   |                                     |   |   |   |   |   |   |
|  See accompanying notes to unaudited consolidated financial statements.                                        |   |                                     |   |   |   |   |   |   |

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|                                                                                                             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |
|------------------------------------------------------------------------------------------------------------------|--------|-----------|-----------|--------|------------------------------|--------|--------|--------|--------|--------|------------|--------|--------|----------|--------|--------|---------------|--------|--------|--------|--------|
|                                                                                                             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |
|                                                                                                             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |
|                                                                                                             |   |      |      |   |  (Unaudited)            |   |   |   |   |   |       |   |   |     |   |   |          |   |
|                                                                                                             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   | Accumulated   |   |   |   |   |
|                                                                                                             |   | Shares of |      |   |                         |   |   |   |   |   | Additional |   |   |     |   |   | Other         |   |   |   |   |
|                                                                                                             |   | Common    |      |   | Preferred                    |   |   | Common |   |   | Paid-in    |   |   | Retained |   |   | Comprehensive |   |   |   |   |
|                                                                                                             |   | Stock     |      |   | Stock                        |   |   | Stock  |   |   | Capital    |   |   | Earnings |   |   | Income (Loss) |   |   | Total  |   |
|                                                                                                             |   |      |      |   |  (Dollars in thousands) |   |   |   |   |   |       |
|                                                                                                             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |
| Balance, January 1, 2010                                                                                         |   |      | 3,782,415 |   |                         | $      | 3,126  |   |   | $      | 38,923     |   |   | $        | 748    |   |          | $      | 1,434  |   |   | $ | 587 |   |   | $ | 44,818 |   |
| Comprehensive income:                                                                                            |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                                                       |   |      | -         |   |                         |   | -      |   |   |   | -          |   |   |     | -      |   |          |   | 207    |   |   |   | - |   |   |   | 207 |   |
| Unrealized holding gains and losses                                                                              |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|    on available-for-sale securities                                                                    |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|    arising during the period, net of                                                                   |   |      | .         |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|    income taxes of $487                                                                                |   |      | -         |   |                         |   | -      |   |   |   | -          |   |   |     | -      |   |          |   | -      |   |   |   | 871 |   |   |   | 871 |   |
|      Total other comprehensive         income             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   | 871 |   |
|         Total comprehensive income                                            |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   | 1,078 |   |
| Dividends paid on preferred stock                                                                                |   |      | -         |   |                         |   | -      |   |   |   | -          |   |   |     | -      |   |          |   | (39    | )      |   |   | - |   |   |   | (39 | ) |
| Exercise of employee stock options                                                                               |   |      | 1,744     |   |                         |   | -      |   |   |   | 17         |   |   |     | -      |   |          |   | -      |   |   |   | - |   |   |   | 17 |   |
| Balance, March 31, 2010                                                                                          |   |      | 3,784,159 |   |                         | $      | 3,126  |   |   | $      | 38,940     |   |   | $        | 748    |   |          | $      | 1,602  |   |   | $ | 1,458 |   |   | $ | 45,874 |   |
|                                                                                                             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
| Balance, January 1, 2011                                                                                         |   |      | 3,972,976 |   |                         | $      | 3,126  |   |   | $      | 39,931     |   |   | $        | 748    |   |          | $      | 1,396  |   |   | $ | 111 |   |   | $ | 45,312 |   |
| Comprehensive income:                                                                                            |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                                                       |   |      | -         |   |                         |   | -      |   |   |   | -          |   |   |     | -      |   |          |   | 175    |   |   |   | - |   |   |   | 175 |   |
| Unrealized holding gains and losses                                                                              |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|   on available-for-sale securities                                                                          |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|   arising during the period, net of                                                                         |   |      | .         |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|   income taxes of $87                                                                                       |   |      | -         |   |                         |   | -      |   |   |   | -          |   |   |     | -      |   |          |   | -      |   |   |   | (155 | ) |   |   | (155 | ) |
|       Total other comprehensive          income |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   | (155 | ) |
|           Total comprehensive income                                |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   | 20 |   |
| Dividends paid on preferred stock                                                                                |   |      | -         |   |                         |   | -      |   |   |   | -          |   |   |     | -      |   |          |   | (39    | )      |   |   | - |   |   |   | (39 | ) |
| Balance, March 31, 2011                                                                                          |   |      | 3,972,976 |   |                         | $      | 3,126  |   |   | $      | 39,931     |   |   | $        | 748    |   |          | $      | 1,532  |   |   | $ | (44 | ) |   | $ | 45,293 |   |
|                                                                                                             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                             |   |      |      |   |                         |   |   |   |   |   |       |   |   |     |   |   |          |   |   |   |   |

----

| COMMUNITY FIRST BANCORPORATION                                         |   |                   |    |   |   |   |
|------------------------------------------------------------------------|--------|------------------------|---------|--------|--------|--------|
| Consolidated Statements of Cash Flows                                  |   |                   |    |   |   |   |
|                                                                   |   | (Unaudited)            |    |
|                                                                   |   | Three Months Ended     |    |
|                                                                   |   | March 31,              |    |
|                                                                   |   | 2011                   |    |   | 2010   |   |
|                                                                   |   | (Dollars in thousands) |    |
| Operating activities                                                   |   |                   |    |   |   |   |
| Net income                                                             |   | $                      | 175     |   |   | $      | 207 |   |
| Adjustments to reconcile net income to net                             |   |                   |    |   |   |   |   |   |
| cash provided by operating activities                                  |   |                   |    |   |   |   |   |   |
| Provision for loan losses                                              |   |                   | 1,250   |   |   |   | 1,125 |   |
| Depreciation                                                           |   |                   | 93      |   |   |   | 97 |   |
| Amortization of net loan fees and costs                                |   |                   | 17      |   |   |   | (13 | ) |
| Securities accretion and premium amortization                          |   |                   | 268     |   |   |   | 294 |   |
| Writedowns of foreclosed assets                                        |   |                   | 45      |   |   |   | - |   |
| Loss (gain) on sale of foreclosed assets                               |   |                   | 29      |   |   |   | (2 | ) |
| Increase in cash surrender value of bank-owned life insurance          |   |                   | (89     | )      |   |   | (92 | ) |
| Decrease (increase) in interest receivable                             |   |                   | 98      |   |   |   | (628 | ) |
| (Decrease) increase in interest payable                                |   |                   | (526    | )      |   |   | 553 |   |
| Decrease in prepaid expenses and other assets                          |   |                   | 258     |   |   |   | 482 |   |
| Increase in other accrued expenses                                     |   |                   | 243     |   |   |   | 173 |   |
| Net cash provided by operating activities                              |   |                   | 1,861   |   |   |   | 2,196 |   |
|                                                                   |   |                   |    |   |   |   |   |   |
| Investing activities                                                   |   |                   |    |   |   |   |   |   |
| Purchases of available-for-sale securities                             |   |                   | (23,965 | )      |   |   | (47,927 | ) |
| Maturities, calls and paydowns of securities available-for-sale        |   |                   | 21,871  |   |   |   | 26,289 |   |
| Maturities, calls and paydowns of securities held-to-maturity          |   |                   | 643     |   |   |   | 678 |   |
| Net decrease (increase) in loans made to customers                     |   |                   | 7,502   |   |   |   | (1,491 | ) |
| Purchases of premises and equipment                                    |   |                   | (5      | )      |   |   | (15 | ) |
| Additional investment in foreclosed assets                             |   |                   | -       |   |   |   | (29 | ) |
| Proceeds of sale of foreclosed assets                                  |   |                   | 324     |   |   |   | 177 |   |
| Net cash provided (used) by investing activities                       |   |                   | 6,370   |   |   |   | (22,318 | ) |
|                                                                   |   |                   |    |   |   |   |   |   |
| Financing activities                                                   |   |                   |    |   |   |   |   |   |
| Net increase in demand deposits, interest                              |   |                   |    |   |   |   |   |   |
| bearing transaction accounts and savings accounts                      |   |                   | 6,516   |   |   |   | 1,629 |   |
| Net (decrease) increase in certificates of deposit and other           |   |                   |    |   |   |   |   |   |
| time deposits                                                          |   |                   | (17,802 | )      |   |   | 31,494 |   |
| Decrease in short-term borrowings                                      |   |                   | (5,000  | )      |   |   | - |   |
| Cash dividends paid on preferred stock                                 |   |                   | (39     | )      |   |   | (39 | ) |
| Exercise of employee stock options                                     |   |                   | -       |   |   |   | 17 |   |
| Net cash (used) provided by financing activities                       |   |                   | (16,325 | )      |   |   | 33,101 |   |
| (Decrease) increase in cash and cash equivalents                       |   |                   | (8,094  | )      |   |   | 12,979 |   |
| Cash and cash equivalents, beginning                                   |   |                   | 40,882  |   |   |   | 47,483 |   |
| Cash and cash equivalents, ending                                      |   | $                      | 32,788  |   |   | $      | 60,462 |   |
|                                                                   |   |                   |    |   |   |   |   |   |
|                                                                   |   |                   |    |   |   |   |   |   |
|                                                                   |   |                   |    |   |   |   |   |   |
| See accompanying notes to unaudited consolidated financial statements. |   |                   |    |   |   |   |   |   |

----

| COMMUNITY FIRST BANCORPORATION                    |   |                   |   |   |   |   |
|---------------------------------------------------|--------|------------------------|--------|--------|--------|--------|
| Consolidated Statements of Cash Flows - continued |   |                   |   |   |   |   |
|                                              |   | (Unaudited)            |   |
|                                              |   | Three Months Ended     |   |
|                                              |   | March 31,              |   |
|                                              |   | 2011                   |   |   | 2010   |   |
|                                              |   | (Dollars in thousands) |   |
| Supplemental Disclosure of Cash Flow Information  |   |                   |   |   |   |   |
| Cash paid during the period for                   |   |                   |   |   |   |   |
|       Interest           |   | $                      | 2,022  |   |   | $      | 1,675 |   |
| Income taxes                                      |   |                   | -      |   |   |   | - |   |
| Net transfers from loans to foreclosed assets     |   |                   | 508    |   |   |   | 255 |   |
| Noncash investing and financing activities:       |   |                   |   |   |   |   |   |   |
| Other comprehensive income (loss)                 |   |                   | (155   | )      |   |   | 871 |   |

----

|                                          |   |      |    |   |   March 31, 2011 |                         |   |       |   |   |      |   |   |   December 31, 2010 |    |   |       |   |
|-----------------------------------------------|--------|-----------|---------|--------|-----------------------|------------------------------|--------|------------|--------|--------|-----------|--------|--------|--------------------------|---------|--------|------------|--------|
|                                          |   |      |    |   | Gross                 |                         |   | Gross      |   |   |      |   |   |                     |    |   | Gross      |   |   | Gross |   |   |   |   |
|                                          |   |      |    |   | Unrealized            |                         |   | Unrealized |   |   | Estimated |   |   |                     |    |   | Unrealized |   |   | Unrealized |   |   | Estimated |   |
|                                          |   | Amortized |    |   | Holding               |                         |   | Holding    |   |   | Fair      |   |   | Amortized                |    |   | Holding    |   |   | Holding |   |   | Fair |   |
|                                          |   | Cost      |    |   | Gains                 |                         |   | Losses     |   |   | Value     |   |   | Cost                     |    |   | Gains      |   |   | Losses |   |   | Value |   |
|                                          |   |      |    |   |                  |  (Dollars in thousands) |   |       |   |   |      |   |   |                     |
| Available-for-sale                            |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |
| Mortgage-backed   securities        |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |
|  issued by US  Government      |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |
| agencies                                      |   | $         | 1,061   |   |                  | $                            | 59     |       |   | $      | -         |   |   | $                        | 1,120   |   |       | $      | 1,128 |   |   | $ | 52 |   |   | $ | - |   |   | $ | 1,180 |   |
| Government sponsored                          |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| enterprises (GSEs)                            |   |      | 126,692 |   |                  |                         | 654    |       |   |   | 1,684     |   |   |                     | 125,662 |   |       |   | 130,492 |   |   |   | 863 |   |   |   | 1,495 |   |   |   | 129,860 |   |
| Mortgage-backed   securities        |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    issued by GSEs              |   |      | 26,139  |   |                  |                         | 944    |       |   |   | 18        |   |   |                     | 27,065  |   |       |   | 20,145 |   |   |   | 983 |   |   |   | - |   |   |   | 21,128 |   |
| State, county and                             |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| municipal                                     |   |      | 17,130  |   |                  |                         | 217    |       |   |   | 241       |   |   |                     | 17,106  |   |       |   | 17,432 |   |   |   | 130 |   |   |   | 361 |   |   |   | 17,201 |   |
| Total                                         |   | $         | 171,022 |   |                  | $                            | 1,874  |       |   | $      | 1,943     |   |   | $                        | 170,953 |   |       | $      | 169,197 |   |   | $ | 2,028 |   |   | $ | 1,856 |   |   | $ | 169,369 |   |
|                                          |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Held-to-maturity                              |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Mortgage-backed  securities              |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| issued by US Government                       |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| agencies                                      |   | $         | -       |   |                  | $                            | -      |       |   | $      | -         |   |   | $                        | -       |   |       | $      | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
| Government sponsored                          |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| enterprises                                   |   |      | -       |   |                  |                         | -      |       |   |   | -         |   |   |                     | -       |   |       |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Mortgage-backed     securities |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    issued by GSEs                   |   |      | 5,746   |   |                  |                         | 398    |       |   |   | -         |   |   |                     | 6,144   |   |       |   | 6,389 |   |   |   | 428 |   |   |   | - |   |   |   | 6,817 |   |
| State, county and                             |   |      |    |   |                  |                         |   |       |   |   |      |   |   |                     |    |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| municipal                                     |   |      | -       |   |                  |                         | -      |       |   |   | -         |   |   |                     | -       |   |       |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Total                                         |   | $         | 5,746   |   |                  | $                            | 398    |       |   | $      | -         |   |   | $                        | 6,144   |   |       | $      | 6,389 |   |   | $ | 428 |   |   | $ | - |   |   | $ | 6,817 |   |

----

|                                          |   |                   |   |   | March 31, 2011                   |   |   |                             |   |   |                |   |
|-----------------------------------------------|--------|------------------------|--------|--------|----------------------------------|--------|--------|----------------------------------|--------|--------|---------------------|--------|
| Available-for-sale at fair value              |   | Due within one year    |   |   | Due after one through five years |   |   | Due after five through ten years |   |   | Due after ten years |   |   | Total |   |
|                                          |   | (Dollars in thousands) |   |   |                             |
| Non-mortgage-backed securities issued by GSEs |   | $                      | -      |   |                             | $      | 34,919 |                             |   | $      | 50,546              |   |   | $ | 40,197 |   |   | $ | 125,662 |   |
| State, county and municpal issuers            |   |                   | -      |   |                             |   | 533    |                             |   |   | 3,990               |   |   |   | 12,583 |   |   |   | 17,106 |   |
|                                          |   |                   | -      |   |                             |   | 35,452 |                             |   |   | 54,536              |   |   |   | 52,780 |   |   |   | 142,768 |   |
| Mortgage-backed securities issued by:         |   |                   |   |   |                             |   |   |                             |   |   |                |   |   |   |   |   |   |   |   |   |
| US Government agencies                        |   |                   |   |   |                             |   |   |                             |   |   |                |   |   |   |   |   |   |   | 1,120 |   |
|    GSEs                             |   |                   |   |   |                             |   |   |                             |   |   |                |   |   |   |   |   |   |   | 27,065 |   |
| Total available-for-sale                      |   |                   |   |   |                             |   |   |                             |   |   |                |   |   |   |   |   |   | $ | 170,953 |   |
|                                          |   |                   |   |   |                             |   |   |                             |   |   |                |   |   |   |   |   |   |   |   |   |
| Held-to-maturity at amortized cost            |   |                   |   |   |                             |   |   |                             |   |   |                |   |   |   |   |   |   |   |   |   |
| Mortgage-backed securities issued by:         |   |                   |   |   |                             |   |   |                             |   |   |                |   |   |   |   |   |   |   |   |   |
| GSEs                                          |   |                   |   |   |                             |   |   |                             |   |   |                |   |   |   |   |   |   | $ | 5,746 |   |
| Total held-to-maturity                        |   |                   |   |   |                             |   |   |                             |   |   |                |   |   |   |   |   |   | $ | 5,746 |   |

----

|                                                  |   |   | March 31, 2011                                           |   |
|-------------------------------------------------------|--------|--------|----------------------------------------------------------|--------|
|                                                  |   |   | Continuously in Unrealized Loss Position for a Period of |   |
|                                                  |   |   | Less than 12 Months                                      |   |   | 12 Months or more |   |   | Total |   |
|                                                  |   |   | EstimatedFair Value                                      |   |   | Unrealized Loss |   |   | EstimatedFair Value |   |   | Unrealized Loss |   |   | EstimatedFair Value |   |   | Unrealized Loss |   |
|                                                  |   |   | (Dollars in thousands)                                   |
| Available-for-sale                                    |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Government-sponsored               |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       enterprises (GSEs)     |   |   | $                                                        | 75,384 |   |   | $ | 1,684 |   |   | $ | - |   |   | $ | - |   |   | $ | 75,384 |   |   | $ | 1,684 |   |
|     Mortgage-backed securities         |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       issued by GSEs         |   |   |                                                     | 3,971  |   |   |   | 18 |   |   |   | - |   |   |   | - |   |   |   | 3,971 |   |   |   | 18 |   |
|     State, county and                  |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       municipal securities   |   |   |                                                     | 6,469  |   |   |   | 188 |   |   |   | 457 |   |   |   | 53 |   |   |   | 6,926 |   |   |   | 241 |   |
|         Total |   |   | $                                                        | 85,824 |   |   | $ | 1,890 |   |   | $ | 457 |   |   | $ | 53 |   |   | $ | 86,281 |   |   | $ | 1,943 |   |
|                                                  |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Held-to-maturity                                      |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     GSEs                               |   |   | $                                                        | -      |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
|         Total |   |   | $                                                        | -      |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
|                                                  |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                  |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                  |   |   | December 31, 2010                                        |   |
|                                                  |   |   | Continuously in Unrealized Loss Position for a Period of |   |
|                                                  |   |   | Less than 12 Months                                      |   |   | 12 Months or more |   |   | Total |   |
|                                                  |   |   | EstimatedFair Value                                      |   |   | Unrealized Loss |   |   | EstimatedFair Value |   |   | Unrealized Loss |   |   | EstimatedFair Value |   |   | Unrealized Loss |   |
|                                                  |   |   | (Dollars in thousands)                                   |
| Available-for-sale                                    |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     GSEs                               |   |   | $                                                        | 60,543 |   |   | $ | 1,495 |   |   | $ | - |   |   | $ | - |   |   | $ | 60,543 |   |   | $ | 1,495 |   |
|     Mortgage-backed securities         |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       issued by GSEs         |   |   |                                                     | -      |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
|     State, county and                  |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       municipal securities   |   |   |                                                     | 9,648  |   |   |   | 306 |   |   |   | 455 |   |   |   | 55 |   |   |   | 10,103 |   |   |   | 361 |   |
|         Total |   |   | $                                                        | 70,191 |   |   | $ | 1,801 |   |   | $ | 455 |   |   | $ | 55 |   |   | $ | 70,646 |   |   | $ | 1,856 |   |
|                                                  |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Held-to-maturity                                      |   |   |                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     GSEs                               |   |   | $                                                        | -      |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
|                                                  |   |   | $                                                        | -      |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |

----

|                                 |   | March 31,              |    |   | December 31, |   |
|--------------------------------------|--------|------------------------|---------|--------|--------------|--------|
|                                 |   | 2011                   |    |   | 2010         |   |
|                                 |   | (Dollars in thousands) |    |
| Commercial, financial and industrial |   | $                      | 19,714  |   |         | $      | 20,474 |   |
| Real estate- construction            |   |                   | 21,315  |   |         |   | 23,730 |   |
| Real estate - mortgage               |   |                   | 183,796 |   |         |   | 187,940 |   |
| Consumer installment                 |   |                   | 22,815  |   |         |   | 24,690 |   |
| Total                                |   |                   | 247,640 |   |         |   | 256,834 |   |
| Allowance for loan losses            |   |                   | (5,839  | )      |         |   | (5,756 | ) |
| Loans - net                          |   | $                      | 241,801 |   |         | $      | 251,078 |   |

|                      |   | 30-59 Days Past Due    |   |   | 60-89 Days Past Due |   |   | 90 Days or More Past Due |   |   | Total Past Due |   |   | Current |   |   | Total Loans |   |
|---------------------------|--------|------------------------|--------|--------|---------------------|--------|--------|--------------------------|--------|--------|----------------|--------|--------|---------|--------|--------|-------------|--------|
| As of March 31, 2011      |   | (Dollars in thousands) |   |
| Commercial, financial and |   |                   |   |   |                |   |   |                     |   |   |           |   |   |    |   |   |        |   |
| industrial                |   | $                      | 80     |   |                | $      | 24     |                     |   | $      | 1,117          |   |   | $       | 1,221  |   |        | $      | 18,493 |   |   | $ | 19,714 |   |
| Real estate- construction |   |                   | 224    |   |                |   | 32     |                     |   |   | 7,176          |   |   |    | 7,432  |   |        |   | 13,883 |   |   |   | 21,315 |   |
| Real estate - mortgage    |   |                   | 778    |   |                |   | 214    |                     |   |   | 11,908         |   |   |    | 12,900 |   |        |   | 170,896 |   |   |   | 183,796 |   |
| Consumer installment      |   |                   | 187    |   |                |   | 69     |                     |   |   | 387            |   |   |    | 643    |   |        |   | 22,172 |   |   |   | 22,815 |   |
| Total                     |   | $                      | 1,269  |   |                | $      | 339    |                     |   | $      | 20,588         |   |   | $       | 22,196 |   |        | $      | 225,444 |   |   | $ | 247,640 |   |
|                      |   |                   |   |   |                |   |   |                     |   |   |           |   |   |    |   |   |        |   |   |   |   |   |   |   |
|                      |   |                   |   |   |                |   |   |                     |   |   |           |   |   |    |   |   |        |   |   |   |   |   |   |   |
|                      |   | 30-59 Days Past Due    |   |   | 60-89 Days Past Due |   |   | 90 Days or More Past Due |   |   | Total Past Due |   |   | Current |   |   | Total Loans |   |
| As of December 31, 2010   |   | (Dollars in thousands) |   |
| Commercial, financial and |   |                   |   |   |                |   |   |                     |   |   |           |   |   |    |   |   |        |   |   |   |   |   |   |   |
| industrial                |   | $                      | 254    |   |                | $      | 214    |                     |   | $      | 855            |   |   | $       | 1,323  |   |        | $      | 19,151 |   |   | $ | 20,474 |   |
| Real estate- construction |   |                   | 485    |   |                |   | 662    |                     |   |   | 6,082          |   |   |    | 7,229  |   |        |   | 16,501 |   |   |   | 23,730 |   |
| Real estate - mortgage    |   |                   | 1,834  |   |                |   | 2,093  |                     |   |   | 8,974          |   |   |    | 12,901 |   |        |   | 175,039 |   |   |   | 187,940 |   |
| Consumer installment      |   |                   | 294    |   |                |   | 256    |                     |   |   | 433            |   |   |    | 983    |   |        |   | 23,707 |   |   |   | 24,690 |   |
| Total                     |   | $                      | 2,867  |   |                | $      | 3,225  |                     |   | $      | 16,344         |   |   | $       | 22,436 |   |        | $      | 234,398 |   |   | $ | 256,834 |   |

----

|                                                              |   | Internally Assigned Risk Grade |   |   |            |   |
|-------------------------------------------------------------------|--------|--------------------------------|--------|--------|-----------------|--------|
|                                                              |   | Management Attention      |   |   | Special Mention |   |   | Substandard |   |   | Doubtful |   |   | Total |   |
| As of March 31, 2011                                              |   | (Dollars in thousands)         |   |
|  Commercial, financial and    industrial |   | $                              | 3,301  |   |            | $      | 2,717 |   |   | $ | 1,585 |   |   | $ | - |   |   | $ | 7,603 |   |
|  Real estate- construction                                   |   |                           | 3,894  |   |            |   | 251 |   |   |   | 11,372 |   |   |   | - |   |   |   | 15,517 |   |
|  Real estate - mortgage                                      |   |                           | 26,093 |   |            |   | 7,957 |   |   |   | 22,312 |   |   |   | - |   |   |   | 56,362 |   |
|  Consumer installment                                        |   |                           | 1,398  |   |            |   | 706 |   |   |   | 1,062 |   |   |   | - |   |   |   | 3,166 |   |
|                                                              |   | $                              | 34,686 |   |            | $      | 11,631 |   |   | $ | 36,331 |   |   | $ | - |   |   | $ | 82,648 |   |
|                                                              |   |                           |   |   |            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                              |   |                           |   |   |            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                              |   | Internally Assigned Risk Grade |   |   |            |   |   |
|                                                              |   | Management Attention           |   |   | Special Mention |   |   | Substandard |   |   | Doubtful |   |   | Total |   |
| As of December 31, 2010                                           |   | (Dollars in thousands)         |   |
|  Commercial, financial and    industrial |   | $                              | 524    |   |            | $      | 577 |   |   | $ | 1,385 |   |   | $ | - |   |   | $ | 2,486 |   |
|  Real estate- construction                                   |   |                           | 1,953  |   |            |   | 2,980 |   |   |   | 7,953 |   |   |   | - |   |   |   | 12,886 |   |
|  Real estate - mortgage                                      |   |                           | 12,628 |   |            |   | 8,326 |   |   |   | 12,795 |   |   |   | 237 |   |   |   | 33,986 |   |
|  Consumer installment                                        |   |                           | 1,177  |   |            |   | 684 |   |   |   | 806 |   |   |   | - |   |   |   | 2,667 |   |
|                                                              |   | $                              | 16,282 |   |            | $      | 12,567 |   |   | $ | 22,939 |   |   | $ | 237 |   |   | $ | 52,025 |   |

----

|                                |                                    |                   |   Recorded Investment |   |   |  Unpaid Principal Balance |   |   |  Related Allowance |   |   | Year-to-Date Average Recorded Investment |   |   | Year-to-Date Interest Income Recognized |   |
|-------------------------------------|-----------------------------------------|------------------------|---------------------------------|--------|--------|--------------------------------|--------|--------|-------------------------|--------|--------|------------------------------------------|--------|--------|-----------------------------------------|--------|
| As of March 31, 2011                |                                    | (Dollars in thousands) |                            |
| With no related allowance recorded: |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |
|                                | Commercial, financial and industrial    |                   | $                               | 586    |   |                           | $      | 586    |                    |   | $      | -                                        |   |   | $                                       | 377    |   |   | $ | 3 |   |
|                                | Real estate- construction               |                   |                            | 15,511 |   |                           |   | 16,027 |                    |   |   | -                                        |   |   |                                    | 9,201  |   |   |   | 122 |   |
|                                | Real estate - mortgage                  |                   |                            | 12,934 |   |                           |   | 13,801 |                    |   |   | -                                        |   |   |                                    | 11,475 |   |   |   | 23 |   |
|                                | Consumer installment                    |                   |                            | 294    |   |                           |   | 294    |                    |   |   | -                                        |   |   |                                    | 314    |   |   |   | 4 |   |
|                                |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |   |
| With an allowance recorded:         |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |
|                                | Commercial, financial and industrial    |                   | $                               | 793    |   |                           | $      | 793    |                    |   | $      | 592                                      |   |   | $                                       | 780    |   |   | $ | - |   |
|                                | Real estate- construction               |                   |                            | 743    |   |                           |   | 922    |                    |   |   | 284                                      |   |   |                                    | 795    |   |   |   | - |   |
|                                | Real estate - mortgage                  |                   |                            | 2,000  |   |                           |   | 2,270  |                    |   |   | 859                                      |   |   |                                    | 3,680  |   |   |   | 1 |   |
|                                | Consumer installment                    |                   |                            | 233    |   |                           |   | 233    |                    |   |   | 135                                      |   |   |                                    | 200    |   |   |   | - |   |
|                                |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |   |
| Total:                              |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |   |
|                                | Commercial, financial and industrial    |                   | $                               | 1,379  |   |                           | $      | 1,379  |                    |   | $      | 592                                      |   |   | $                                       | 1,157  |   |   | $ | 3 |   |
|                                | Real estate - construction and mortgage |                   |                            | 31,188 |   |                           |   | 33,020 |                    |   |   | 1,143                                    |   |   |                                    | 25,151 |   |   |   | 146 |   |
|                                | Consumer installment                    |                   |                            | 527    |   |                           |   | 527    |                    |   |   | 135                                      |   |   |                                    | 514    |   |   |   | 4 |   |
|                                | Total                                   |                   | $                               | 33,094 |   |                           | $      | 34,926 |                    |   | $      | 1,870                                    |   |   | $                                       | 26,822 |   |   | $ | 153 |   |
|                                |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |   |
|                                |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |   |
|                                |                                    |                   |  Recorded Investment       |   |   |  Unpaid Principal Balance |   |   |  Related Allowance |   |   | Year-to-Date Average Recorded Investment |   |   | Year-to-Date Interest Income Recognized |   |
| As of December 31, 2010             |                                    | (Dollars in thousands) |                            |
| With no related allowance recorded: |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |
|                                | Commercial, financial and industrial    |                   | $                               | 167    |   |                           | $      | 167    |                    |   | $      | -                                        |   |   | $                                       | 73     |   |   | $ | - |   |
|                                | Real estate- construction               |                   |                            | 2,890  |   |                           |   | 3,462  |                    |   |   | -                                        |   |   |                                    | 2,569  |   |   |   | 13 |   |
|                                | Real estate - mortgage                  |                   |                            | 9,989  |   |                           |   | 10,638 |                    |   |   | -                                        |   |   |                                    | 7,761  |   |   |   | 118 |   |
|                                | Consumer installment                    |                   |                            | 334    |   |                           |   | 334    |                    |   |   | -                                        |   |   |                                    | 262    |   |   |   | - |   |
|                                |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |   |
| With an allowance recorded:         |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |
|                                | Commercial, financial and industrial    |                   | $                               | 767    |   |                           | $      | 767    |                    |   | $      | 515                                      |   |   | $                                       | 455    |   |   | $ | - |   |
|                                | Real estate- construction               |                   |                            | 846    |   |                           |   | 874    |                    |   |   | 45                                       |   |   |                                    | 1,523  |   |   |   | 41 |   |
|                                | Real estate - mortgage                  |                   |                            | 5,360  |   |                           |   | 5,529  |                    |   |   | 1,632                                    |   |   |                                    | 6,465  |   |   |   | - |   |
|                                | Consumer installment                    |                   |                            | 166    |   |                           |   | 166    |                    |   |   | 66                                       |   |   |                                    | 273    |   |   |   | - |   |
|                                |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |   |
| Total:                              |                                    |                   |                            |   |   |                           |   |   |                    |   |   |                                     |   |   |                                    |   |   |   |   |   |   |
|                                | Commercial, financial and industrial    |                   | $                               | 934    |   |                           | $      | 934    |                    |   | $      | 515                                      |   |   | $                                       | 528    |   |   | $ | - |   |
|                                | Real estate - construction and mortgage |                   |                            | 19,085 |   |                           |   | 20,503 |                    |   |   | 1,677                                    |   |   |                                    | 18,318 |   |   |   | 172 |   |
|                                | Consumer installment                    |                   |                            | 500    |   |                           |   | 500    |                    |   |   | 66                                       |   |   |                                    | 535    |   |   |   | - |   |
|                                | Total                                   |                   | $                               | 20,519 |   |                           | $      | 21,937 |                    |   | $      | 2,258                                    |   |   | $                                       | 19,381 |   |   | $ | 172 |   |

----

|                          |   | Secured by             |    |   |   |   |   |   |   |
|-------------------------------|--------|------------------------|---------|--------|--------|--------|--------|--------|--------|
|                          |   | Real Estate            |    |   | Other  |   |   | Total  |   |
| As of March 31, 2011          |   | (Dollars in thousands) |    |
| Allowance for credit losses   |   |                   |    |   |   |   |   |   |   |
| Ending balance                |   | $                      | 4,124   |   |   | $      | 1,715  |   |   | $ | 5,839 |   |
| Ending balance - individually |   |                   |    |   |   |   |   |   |   |   |   |   |
| evaluated for impairment      |   | $                      | 1,143   |   |   | $      | 727    |   |   | $ | 1,870 |   |
| Ending balance - collectively |   |                   |    |   |   |   |   |   |   |   |   |   |
| evaluated for impairment      |   | $                      | 2,981   |   |   | $      | 988    |   |   | $ | 3,969 |   |
|                          |   |                   |    |   |   |   |   |   |   |   |   |   |
| Loans                         |   |                   |    |   |   |   |   |   |   |   |   |   |
| Ending balance                |   | $                      | 205,111 |   |   | $      | 42,529 |   |   | $ | 247,640 |   |
| Ending balance - individually |   |                   |    |   |   |   |   |   |   |   |   |   |
| evaluated for impairment      |   | $                      | 31,188  |   |   | $      | 1,906  |   |   | $ | 33,094 |   |
| Ending balance - collectively |   |                   |    |   |   |   |   |   |   |   |   |   |
| evaluated for impairment      |   | $                      | 173,923 |   |   | $      | 40,623 |   |   | $ | 214,546 |   |
|                          |   |                   |    |   |   |   |   |   |   |   |   |   |
|                          |   |                   |    |   |   |   |   |   |   |   |   |   |
|                          |   | Secured by             |    |   |   |   |   |   |   |   |   |
|                          |   | Real Estate            |    |   | Other  |   |   | Total  |   |
| As of December 31, 2010       |   | (Dollars in thousands) |    |
| Allowance for credit losses   |   |                   |    |   |   |   |   |   |   |   |   |   |
| Ending balance                |   | $                      | 3,753   |   |   | $      | 2,003  |   |   | $ | 5,756 |   |
| Ending balance - individually |   |                   |    |   |   |   |   |   |   |   |   |   |
| evaluated for impairment      |   | $                      | 1,504   |   |   | $      | 754    |   |   | $ | 2,258 |   |
| Ending balance - collectively |   |                   |    |   |   |   |   |   |   |   |   |   |
| evaluated for impairment      |   | $                      | 2,249   |   |   | $      | 1,249  |   |   | $ | 3,498 |   |
|                          |   |                   |    |   |   |   |   |   |   |   |   |   |
| Loans                         |   |                   |    |   |   |   |   |   |   |   |   |   |
| Ending balance                |   | $                      | 211,520 |   |   | $      | 45,314 |   |   | $ | 256,834 |   |
| Ending balance - individually |   |                   |    |   |   |   |   |   |   |   |   |   |
| evaluated for impairment      |   | $                      | 18,425  |   |   | $      | 2,094  |   |   | $ | 20,519 |   |
| Ending balance - collectively |   |                   |    |   |   |   |   |   |   |   |   |   |
| evaluated for impairment      |   | $                      | 193,095 |   |   | $      | 43,220 |   |   | $ | 236,315 |   |

----

|                                      |   | Secured by             |   |   |   |   |   |   |   |
|-------------------------------------------|--------|------------------------|--------|--------|--------|--------|--------|--------|--------|
|                                      |   | Real Estate            |   |   | Other  |   |   | Total  |   |
| For the three months ended March 31, 2011 |   | (Dollars in thousands) |   |
| Allowance for credit losses               |   |                   |   |   |   |   |   |   |   |
| Balance, January 1, 2011                  |   | $                      | 3,753  |   |   | $      | 2,003  |   |   | $ | 5,756 |   |
| Provision charged to expense              |   |                   | 1,436  |   |   |   | (186   | )      |   |   | 1,250 |   |
| Recoveries                                |   |                   | -      |   |   |   | 49     |   |   |   | 49 |   |
| Charge-offs                               |   |                   | (1,065 | )      |   |   | (151   | )      |   |   | (1,216 | ) |
| Balance at March 31, 2011                 |   | $                      | 4,124  |   |   | $      | 1,715  |   |   | $ | 5,839 |   |

|                                                                                             |                                           |   | Three Months Ended        |      |
|--------------------------------------------------------------------------------------------------|------------------------------------------------|--------|---------------------------|-----------|
|                                                                                             |                                           |   | March 31,                 |      |
|                                                                                             |                                           |   | 2011                      |      |   | 2010 |   |
|                                                                                             |                                           |   | (Dollars in thousands,    |      |
|                                                                                             |                                           |   | except per share amounts) |      |
|                                                                                             |                                           |   |                      |      |   |   |   |
| Net income per common share, basic                                                               |                                           |   |                      |      |   |   |
|     Numerator - net income available to common shareholders                       |                                           | $      | 116                       |      |   | $ | 148 |   |
|     Denominator                                                                   |                                           |   |                      |      |   |   |   |   |   |
|       Weighted average common shares issued and outstanding             |                                           |   | 3,972,976                 |      |   |   | 3,972,451 |   |
|                                                                                             | Net income per common share, basic             |   | $                         | .03       |   |   | $ | .04 |   |
|                                                                                             |                                           |   |                      |      |   |   |   |   |   |
| Net income per common share, assuming dilution                                                   |                                           |   |                      |      |   |   |   |   |
|     Numerator - net income available to common shareholders                       |                                           | $      | 116                       |      |   | $ | 148 |   |
|     Denominator                                                                   |                                           |   |                      |      |   |   |   |   |   |
|         Weighted average common shares issued and outstanding |                                           |   | 3,972,976                 |      |   |   | 3,972,451 |   |
|         Effect of dilutive stock options                      |                                           |   | -                         |      |   |   | - |   |
|                                                                                             | Total shares                                   |   |                      | 3,972,976 |   |   |   | 3,972,451 |   |
|                                                                                             | Net income per common share, assuming dilution |   | $                         | .03       |   |   | $ | .04 |   |

----

|                          |              |   | Fair Value Measurement at Reporting Date Using |   |
|-------------------------------|-------------------|--------|------------------------------------------------|--------|
|                          |              |   | Quoted Prices                                  |   |   |   |   |   |   |   |
|                          |              |   | in Active                                      |   |   | Significant |   |   |   |   |
|                          |              |   | Markets for                                    |   |   | Other |   |   | Significant |   |
|                          |              |   | Identical                                      |   |   | Observable |   |   | Unobservable |   |
|                          |              |   | Assets                                         |   |   | Inputs |   |   | Inputs |   |
| Description                   | March 31, 2011    |   | (Level 1)                                      |   |   | (Level 2) |   |   | (Level 3) |   |
|                          |              |   | (Dollars in thousands)                         |   |
| Securities available-for-sale |              |   | $                                              | -      |   |   | $ | 170,953 |   |   | $ | - |   |
|                          |              |   |                                           |   |   |   |   |   |   |   |   |   |   |
|                          |              |   |                                           |   |   |   |   |   |   |   |   |   |   |
|                          |              |   | Fair Value Measurement at Reporting Date Using |   |
|                          |              |   | Quoted Prices                                  |   |   |   |   |   |   |   |   |   |
|                          |              |   | in Active                                      |   |   | Significant |   |   |   |   |   |
|                          |              |   | Markets for                                    |   |   | Other |   |   | Significant |   |
|                          |              |   | Identical                                      |   |   | Observable |   |   | Unobservable |   |
|                          |              |   | Assets                                         |   |   | Inputs |   |   | Inputs |   |
| Description                   | December 31, 2010 |   | (Level 1)                                      |   |   | (Level 2) |   |   | (Level 3) |   |
|                          |              |   | (Dollars in thousands)                         |   |
| Securities available-for-sale |              |   | $                                              | -      |   |   | $ | 169,369 |   |   | $ | - |   |

----

|                                |           |   | Fair Value Measurement at Reporting Date Using |   |
|-------------------------------------|----------------|--------|------------------------------------------------|--------|
|                                |           |   | Quoted Prices                                  |   |   |   |   |   |   |   |
|                                |           |   | in Active                                      |   |   | Significant |   |   |   |   |
|                                |           |   | Markets for                                    |   |   | Other |   |   | Significant |   |
|                                |           |   | Identical                                      |   |   | Observable |   |   | Unobservable |   |
|                                |           |   | Assets                                         |   |   | Inputs |   |   | Inputs |   |
|                                | March 31, 2011 |   | (Level 1)                                      |   |   | (Level 2) |   |   | (Level 3) |   |
| Description                         |           |   | (Dollars in thousands)                         |   |
| Collateral-dependent impaired loans |           |   | $                                              | -      |   |   | $ | 20,274 |   |   | $ | - |   |
| Land held for sale                  |           |   |                                           | -      |   |   |   | 139 |   |   |   | - |   |
| Foreclosed assets                   |           |   |                                           |   |   |   |   | 5,903 |   |   |   |   |   |

|                                |              |   | Fair Value Measurement at Reporting Date Using |   |
|-------------------------------------|-------------------|--------|------------------------------------------------|--------|
|                                |              |   | Quoted Prices                                  |   |   |   |   |   |   |   |
|                                |              |   | in Active                                      |   |   | Significant |   |   |   |   |
|                                |              |   | Markets for                                    |   |   | Other |   |   | Significant |   |
|                                |              |   | Identical                                      |   |   | Observable |   |   | Unobservable |   |
|                                |              |   | Assets                                         |   |   | Inputs |   |   | Inputs |   |
|                                | December 31, 2010 |   | (Level 1)                                      |   |   | (Level 2) |   |   | (Level 3) |   |
| Description                         |              |   | (Dollars in thousands)                         |   |
| Collateral-dependent impaired loans |              |   | $                                              | -      |   |   | $ | 20,312 |   |   | $ | - |   |
| Land held for sale                  |              |   |                                           | -      |   |   |   | 139 |   |   |   | - |   |
| Foreclosed assets                   |              |   |                                           |   |   |   |   | 11,395 |   |   |   |   |   |

----

|                                                        |   | March 31, 2011         |    |   | December 31, 2010 |   |
|-------------------------------------------------------------|--------|------------------------|---------|--------|-------------------|--------|
|                                                        |   | Carrying               |    |   | Estimated         |   |   | Carrying |   |   | Estimated |   |
|                                                        |   | Amount                 |    |   | Fair Value        |   |   | Amount |   |   | Fair Value |   |
|                                                        |   | (Dollars in thousands) |    |
| Financial assets                                            |   |                   |    |   |              |   |   |   |   |   |   |   |
|     Cash and due from banks                  |   | $                      | 1,991   |   |              | $      | 1,991 |   |   | $ | 1,711 |   |   | $ | 1,711 |   |
|     Interest bearing deposits due from banks |   |                   | 30,797  |   |              |   | 30,797 |   |   |   | 39,171 |   |   |   | 39,171 |   |
|     Securities available-for-sale            |   |                   | 170,953 |   |              |   | 170,953 |   |   |   | 169,369 |   |   |   | 169,369 |   |
|     Securities held-to-maturity              |   |                   | 5,746   |   |              |   | 6,144 |   |   |   | 6,389 |   |   |   | 6,817 |   |
|     Federal Home Loan Bank stock             |   |                   | 1,363   |   |              |   | 1,363 |   |   |   | 1,363 |   |   |   | 1,363 |   |
|     Loans - net                              |   |                   | 241,801 |   |              |   | 242,604 |   |   |   | 251,079 |   |   |   | 252,385 |   |
|     Accrued interest receivable              |   |                   | 2,393   |   |              |   | 2,393 |   |   |   | 2,491 |   |   |   | 2,491 |   |
| Financial liabilities                                       |   |                   |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
|     Deposits                                 |   |                   | 434,024 |   |              |   | 434,889 |   |   |   | 445,310 |   |   |   | 446,763 |   |
|     Accrued interest payable                 |   |                   | 1,172   |   |              |   | 1,172 |   |   |   | 1,698 |   |   |   | 1,698 |   |
|     Short-term borrowings                    |   |                   | -       |   |              |   | - |   |   |   | 5,000 |   |   |   | 5,000 |   |
|     Long-term debt                           |   |                   | 6,500   |   |              |   | 6,529 |   |   |   | 6,500 |   |   |   | 6,528 |   |

----

|                          |   | March 31, 2011         |   |   | December 31, 2010 |   |
|-------------------------------|--------|------------------------|--------|--------|-------------------|--------|
|                          |   | Notional/              |   |   | Estimated         |   |   | Notional/ |   |   | Estimated |   |
|                          |   | Contract               |   |   | Fair              |   |   | Contract |   |   | Fair |   |
|                          |   | Amount                 |   |   | Value             |   |   | Amount |   |   | Value |   |
|                          |   | (Dollars in thousands) |   |
| Off-balance sheet commitments |   |                   |   |   |              |   |   |   |   |   |   |   |
| Loan commitments              |   | $                      | 23,197 |   |              | $      | - |   |   | $ | 26,834 |   |   | $ | - |   |
| Standby letters of credit     |   |                   | 869    |   |              |   | - |   |   |   | 869 |   |   |   | - |   |

|                                                                    |   | Three Months Ended March 31, |   |
|-------------------------------------------------------------------------|--------|------------------------------|--------|
|                                                                    |   | 2011                         |   |   | 2010 |   |
|                                                                    |   | (Dollars in thousands)       |   |
|                                                                    |   |                         |   |   |   |   |
| Salaries and employee benefits                                          |   | $                            | 1,220  |   |   | $ | 1,119 |   |
| Net occupancy expense                                                   |   |                         | 139    |   |   |   | 145 |   |
| Furniture and equipment expense                                         |   |                         | 79     |   |   |   | 90 |   |
| Amortization of computer software                                       |   |                         | 97     |   |   |   | 112 |   |
| FDIC insurance expense                                                  |   |                         | 232    |   |   |   | 398 |   |
| Debit card transaction expenses                                         |   |                         | 116    |   |   |   | 100 |   |
| Other expense                                                           |   |                         |   |   |   |   |   |   |
|     Stationery, printing and postage                     |   |                         | 89     |   |   |   | 87 |   |
|  Telephone                                                         |   |                         | 62     |   |   |   | 45 |   |
|     Advertising and promotion                            |   |                         | 43     |   |   |   | 24 |   |
|     Professional services                                |   |                         | 75     |   |   |   | 122 |   |
|     Directors' compensation                              |   |                         | 48     |   |   |   | 35 |   |
|      Foreclosed assets costs and expenses, net |   |                         | 201    |   |   |   | 55 |   |
|     Data processing expenses                             |   |                         | 97     |   |   |   | 113 |   |
|  Other                                                             |   |                         | 89     |   |   |   | 40 |   |
| Total                                                                   |   | $                            | 2,587  |   |   | $ | 2,485 |   |

----

| ·   | future economic and business conditions; |
|--------------------|------------------------------------------|

| ·   | lack of sustained growth and disruptions in the economies of the Company's market areas; |
|--------------------|------------------------------------------------------------------------------------------|

| ·   | government monetary and fiscal policies; |
|--------------------|------------------------------------------|

| ·   | the effects of changes in interest rates on the levels, composition and costs of deposits, loan demand, and the values of loan collateral, securities, and interest sensitive assets and liabilities; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the effects of competition from a wide variety of local, regional, national and other providers of financial, investment, and insurance services, as well as competitors that offer banking products and services by mail, telephone, computer and/or the Internet; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | credit risks; |
|--------------------|---------------|

| ·   | higher than anticipated levels of defaults on loans; |
|--------------------|------------------------------------------------------|

| ·   | perceptions by depositors about the safety of their deposits; |
|--------------------|---------------------------------------------------------------|

| ·   | capital adequacy; |
|--------------------|-------------------|

| ·   | the failure of assumptions underlying the establishment of the allowance for loan losses and other estimates, including the value of collateral securing loans; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | ability to continue to weather the current economic downturn; |
|--------------------|---------------------------------------------------------------|

| ·   | loss of consumer or investor confidence; |
|--------------------|------------------------------------------|

| ·   | availability of liquidity sources; |
|--------------------|------------------------------------|

| ·   | the risks of opening new offices, including, without limitation, the related costs and time of building customer relationships and integrating operations as part of these endeavors and the failure to achieve expected gains, revenue growth and/or expense savings from such endeavors; |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the risks related to acquiring other financial institutions; |
|--------------------|--------------------------------------------------------------|

| ·   | changes in laws and regulations, including tax, banking and securities laws and regulations; |
|--------------------|----------------------------------------------------------------------------------------------|

| ·   | changes in the requirements of regulatory authorities; |
|--------------------|--------------------------------------------------------|

| ·   | changes in accounting policies, rules and practices; |
|--------------------|------------------------------------------------------|

| ·   | cost and difficulty of implementing changes in technology and products; |
|--------------------|-------------------------------------------------------------------------|

| ·   | the effects of war or other conflicts, acts of terrorism or other catastrophic events that may affect general economic conditions and economic confidence; and |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | other factors and information described in this report and in any of  the other reports that we file with the Securities and Exchange Commission under the Securities Exchange Act of 1934. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                          |   | Summary Income Statement |   |
|-----------------------------------------------|--------|--------------------------|--------|
|                                          |   | (Dollars in thousands)   |   |
| For the Three Months Ended March 31,          |   | 2011                     |   |   | 2010 |   |   | Dollar Change |   |   | Percentage Change |
| Interest income                               |   | $                        | 4,954  |   |   | $ | 5,526 |   |   | $ | (572 | ) |   |   | -10.4 | % |
| Interest expense                              |   |                     | 1,496  |   |   |   | 2,228 |   |   |   | (732 | ) |   |   | -32.9 | % |
| Net interest income                           |   |                     | 3,458  |   |   |   | 3,298 |   |   |   | 160 |   |   |   | 4.9 | % |
| Provision for loan losses                     |   |                     | 1,250  |   |   |   | 1,125 |   |   |   | 125 |   |   |   | 11.1 | % |
| Noninterest income                            |   |                     | 588    |   |   |   | 536 |   |   |   | 52 |   |   |   | 9.7 | % |
| Noninterest expenses                          |   |                     | 2,587  |   |   |   | 2,485 |   |   |   | 102 |   |   |   | 4.1 | % |
| Income tax expense                            |   |                     | 34     |   |   |   | 17 |   |   |   | 17 |   |   |   | 100.0 | % |
| Net income                                    |   |                     | 175    |   |   |   | 207 |   |   |   | (32 | ) |   |   | -15.5 | % |
| Preferred stock dividends paid or accumulated |   |                     | (59    | ) |   |   | (59 | ) |   |   | - |   |   |   | 0.0 | % |
| Net income available to common shareholders   |   | $                        | 116    |   |   | $ | 148 |   |   | $ | (32 | ) |   |   | -21.6 | % |

----

----

|   |   | Average Balances, Yields and Rates |   |
|--------|--------|------------------------------------|--------|
|   |   | Three Months Ended March 31,       |   |
|   |   | 2011                               |   |   | 2010 |   |
|   |   | Interest                           |   |   | Interest |   |
|   |   | Average                            |   |   | Income/ |   |   | Yields/ |   |   | Average |   |   | Income/ |   |   | Yields/ |   |
|   |   | Balances                           |   |   | Expense |   |   | Rates (1) |   |   | Balances |   |   | Expense |   |   | Rates (1) |   |
|   |   | (Dollars in thousands)             |   |
| Assets |   |                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Interest-bearing deposits due from banks                                                                              |   | $      | 50,011  |   |   | $      | 28     |   |   |   | 0.23   | %      |   | $      | 68,712  |   |   | $      | 38     |   |   |   | 0.22   | %      |
|-----------------------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Securities                                                                                                            |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Taxable                                                                                                               |   |   | 160,766 |   |   |   | 1,124  |   |   |   | 2.84   | %      |   |   | 141,520 |   |   |   | 1,285  |   |   |   | 3.68   | %      |
| Tax exempt (2)                                                                                                        |   |   | 17,327  |   |   |   | 177    |   |   |   | 4.14   | %      |   |   | 19,514  |   |   |   | 199    |   |   |   | 4.14   | %      |
| Total investment securities                                                                                           |   |   | 178,093 |   |   |   | 1,301  |   |   |   | 2.96   | %      |   |   | 161,034 |   |   |   | 1,484  |   |   |   | 3.74   | %      |
| Other investments                                                                                                     |   |   | 1,363   |   |   |   | 2      |   |   |   | 0.60   | %      |   |   | 1,307   |   |   |   | -      |   |   |   | 0.00   | %      |
| Loans (2) (3) (4)                                                                                                     |   |   | 252,187 |   |   |   | 3,623  |   |   |   | 5.83   | %      |   |   | 266,325 |   |   |   | 4,004  |   |   |   | 6.10   | %      |
| Total interest earning assets                                                                                         |   |   | 481,654 |   |   |   | 4,954  |   |   |   | 4.17   | %      |   |   | 497,378 |   |   |   | 5,526  |   |   |   | 4.51   | %      |
| Cash and due from banks                                                                                               |   |   | 2,305   |   |   |   |   |   |   |   |   |   |   |   | 1,987   |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses                                                                                             |   |   | (5,767  | )      |   |   |   |   |   |   |   |   |   |   | (5,969  | )      |   |   |   |   |   |   |   |   |
| Unrealized securities gains (losses)                                                                                  |   |   | (115    | )      |   |   |   |   |   |   |   |   |   |   | 1,610   |   |   |   |   |   |   |   |   |   |
| Premises and equipment                                                                                                |   |   | 8,124   |   |   |   |   |   |   |   |   |   |   |   | 8,563   |   |   |   |   |   |   |   |   |   |
| Other assets                                                                                                          |   |   | 28,723  |   |   |   |   |   |   |   |   |   |   |   | 23,418  |   |   |   |   |   |   |   |   |   |
| Total assets                                                                                                          |   | $      | 514,924 |   |   |   |   |   |   |   |   |   |   | $      | 526,987 |   |   |   |   |   |   |   |   |   |
|                                                                                                                  |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Liabilities and shareholders' equity                                                                                  |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |
| Interest bearing deposits                                                                                             |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Interest bearing transaction accounts                                                                                 |   | $      | 74,568  |   |   | $      | 87     |   |   |   | 0.47   | %      |   | $      | 56,450  |   |   | $      | 84     |   |   |   | 0.60   | %      |
| Savings                                                                                                               |   |   | 41,713  |   |   |   | 31     |   |   |   | 0.30   | %      |   |   | 36,235  |   |   |   | 27     |   |   |   | 0.30   | %      |
| Time deposits $100M and over                                                                                          |   |   | 126,334 |   |   |   | 562    |   |   |   | 1.80   | %      |   |   | 141,530 |   |   |   | 733    |   |   |   | 2.10   | %      |
| Other time deposits                                                                                                   |   |   | 168,015 |   |   |   | 752    |   |   |   | 1.82   | %      |   |   | 189,113 |   |   |   | 1,308  |   |   |   | 2.81   | %      |
| Total interest bearing                                                                                                |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
|   deposits                                                                                                  |   |   | 410,630 |   |   |   | 1,432  |   |   |   | 1.41   | %      |   |   | 423,328 |   |   |   | 2,152  |   |   |   | 2.06   | %      |
| Long-term debt                                                                                                        |   |   | 6,500   |   |   |   | 64     |   |   |   | 3.99   | %      |   |   | 8,000   |   |   |   | 76     |   |   |   | 3.85   | %      |
| Total interest bearing                                                                                                |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |   |   |   |   |   |   |   |
|   liabilities                                                                                               |   |   | 417,130 |   |   |   | 1,496  |   |   |   | 1.45   | %      |   |   | 431,328 |   |   |   | 2,228  |   |   |   | 2.09   | %      |
| Noninterest bearing demand deposits                                                                                   |   |   | 49,152  |   |   |   |   |   |   |   |   |   |   |   | 46,419  |   |   |   |   |   |   |   |   |   |
| Other liabilities                                                                                                     |   |   | 3,427   |   |   |   |   |   |   |   |   |   |   |   | 4,036   |   |   |   |   |   |   |   |   |   |
| Shareholders' equity                                                                                                  |   |   | 45,215  |   |   |   |   |   |   |   |   |   |   |   | 45,204  |   |   |   |   |   |   |   |   |   |
| Total liabilities and shareholders'                                                                                   |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |   |   |   |   |
| equity                                                                                                                |   | $      | 514,924 |   |   |   |   |   |   |   |   |   |   | $      | 526,987 |   |   |   |   |   |   |   |   |   |
| Interest rate spread                                                                                                  |   |   |    |   |   |   |   |   |   |   | 2.72   | %      |   |   |    |   |   |   |   |   |   |   | 2.42   | %      |
| Net interest income and net yield                                                                                     |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |
| on earning assets                                                                                                     |   |   |    |   |   | $      | 3,458  |   |   |   | 2.91   | %      |   |   |    |   |   | $      | 3,298  |   |   |   | 2.69   | %      |
| Interest free funds supporting earning                                                                                |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |
| assets                                                                                                                |   | $      | 64,524  |   |   |   |   |   |   |   |   |   |   | $      | 66,050  |   |   |   |   |   |   |   |   |   |
| _________________________________________                                                                             |   |   |    |   |   |   |   |   |   |
| (1) Yields and rates are annualized.                                                                             |   |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |   |
| (2) Yields on tax exempt instruments have not been adjusted to a tax-equivalent basis.                           |   |
| (3) Nonaccruing loans are included in the loan balance and income from such loans is recognized on a cash basis. |   |
| (4) Includes immaterial amounts of loan fees.                                                                    |   |   |    |   |   |   |   |   |   |   |   |   |   |

----

|                                           |   | Three Months           |    |   |         |   |    | Three Months |   |
|------------------------------------------------|--------|------------------------|---------|--------|--------------|--------|---------|--------------|--------|
|                                           |   | Ended                  |    |   | Year Ended   |   |    | Ended        |   |
|                                           |   | March 31,              |    |   | December 31, |   |    | March 31,    |   |
|                                           |   | 2011                   |    |   | 2010         |   |    | 2010         |   |
|                                           |   | (Dollars in thousands) |
| Allowance at beginning of period               |   | $                      | 5,756   |   |         | $      | 6,052   |         |   | $ | 6,052 |   |
| Provision for loan losses                      |   |                   | 1,250   |   |         |   | 4,525   |         |   |   | 1,125 |   |
| Net charge-offs                                |   |                   | (1,167  | )      |         |   | (4,821  | )            |   |   | (993 | ) |
| Allowance at end of period                     |   | $                      | 5,839   |   |         | $      | 5,756   |         |   | $ | 6,184 |   |
| Allowance as a percentage of loans outstanding |   |                   |    |   |         |   |    |         |   |   |   |   |
|     at period end               |   |                   | 2.36    | %      |         |   | 2.24    | %            |   |   | 2.31 | % |
| Loans at end of period                         |   | $                      | 247,640 |   |         | $      | 256,834 |         |   | $ | 267,504 |   |

----

|               |   |                   |   |   | 90 Days or    |   |   |           |   |   |     |   |   |       |   |
|--------------------|--------|------------------------|--------|--------|---------------|--------|--------|----------------|--------|--------|----------|--------|--------|------------|--------|
|               |   |                   |   |   | More Past Due |   |   | Troubled       |   |   | Total    |   |   | Percentage |
|               |   | Nonaccrual             |   |   | and Still     |   |   | Debt           |   |   | Impaired |   |   | of Total   |
|               |   | Loans                  |   |   | Accruing      |   |   | Restructurings |   |   | Loans    |   |   | Loans      |
|               |   | (Dollars in thousands) |
| January 1, 2009    |   | $                      | 11,799 |   |          | $      | -      |           |   | $      | -        |   |   | $          | 11,799 |   |   |   | 4.36 | % |
| Net change         |   |                   | 2,835  |   |          |   | -      |           |   |   | -        |   |   |       | 2,835  |   |   |   |   |   |
| March 31, 2009     |   |                   | 14,634 |   |          |   | -      |           |   |   | -        |   |   |       | 14,634 |   |   |   | 5.31 | % |
| Net change         |   |                   | 2,882  |   |          |   | -      |           |   |   | -        |   |   |       | 2,882  |   |   |   |   |   |
| June 30, 2009      |   |                   | 17,516 |   |          |   | -      |           |   |   | -        |   |   |       | 17,516 |   |   |   | 6.41 | % |
| Net change         |   |                   | (2,632 | )      |          |   | -      |           |   |   | -        |   |   |       | (2,632 | ) |   |   |   |   |
| September 30, 2009 |   |                   | 14,884 |   |          |   | -      |           |   |   | -        |   |   |       | 14,884 |   |   |   | 5.52 | % |
| Net change         |   |                   | (1,014 | )      |          |   | -      |           |   |   | -        |   |   |       | (1,014 | ) |   |   |   |   |
| December 31, 2009  |   |                   | 13,870 |   |          |   | -      |           |   |   | -        |   |   |       | 13,870 |   |   |   | 5.19 | % |
| Net change         |   |                   | 2,575  |   |          |   | -      |           |   |   | -        |   |   |       | 2,575  |   |   |   |   |   |
| March 31, 2010     |   |                   | 16,445 |   |          |   | -      |           |   |   | -        |   |   |       | 16,445 |   |   |   | 6.15 | % |
| Net change         |   |                   | (603   | )      |          |   | -      |           |   |   | -        |   |   |       | (603   | ) |   |   |   |   |
| June 30, 2010      |   |                   | 15,842 |   |          |   | -      |           |   |   | -        |   |   |       | 15,842 |   |   |   | 5.97 | % |
| Net change         |   |                   | (880   | )      |          |   | -      |           |   |   | 2,988    |   |   |       | 2,108  |   |   |   |   |   |
| September 30, 2010 |   |                   | 14,962 |   |          |   | -      |           |   |   | 2,988    |   |   |       | 17,950 |   |   |   | 6.85 | % |
| Net change         |   |                   | 1,382  |   |          |   | -      |           |   |   | 2,469    |   |   |       | 3,851  |   |   |   |   |   |
| December 31, 2010  |   |                   | 16,344 |   |          |   | -      |           |   |   | 5,457    |   |   |       | 21,801 |   |   |   | 8.49 | % |
| Net change         |   |                   | 4,244  |   |          |   | -      |           |   |   | 7,049    |   |   |       | 11,293 |   |   |   |   |   |
| March 31, 2011     |   | $                      | 20,588 |   |          | $      | -      |           |   | $      | 12,506   |   |   | $          | 33,094 |   |   |   | 13.36 | % |

----

----

|                                   |   |        |        |   |              | Total   |   |     |
|----------------------------------------|--------|-------------|-------------|--------|-------------------|---------|--------|----------|
|                                   |   |        |        | Tier 1 |              | Capital |   | Leverage |
| Community First Bancorporation         |   | 15.0%       |        | 16.3%  |              | 8.8%    |
| Community First Bank                   |   |        | 13.1%       |   | 14.4%             |    | 7.7%   |
| Minimum "well-capitalized" requirement |   |   6.0% |        | 10.0%  |              | 5.0%    |
| Minimum requirement                    |   |        |   4.0% |   |    8.0% |    | 4.0%   |

|                      |   | March 31, 2011 |   |
|---------------------------|--------|----------------|--------|
|                      |   | (Dollars in    |   |
|                      |   | thousands)     |   |
| Loan commitments          |   | $              | 23,197 |   |
| Standby letters of credit |   |           | 869    |   |

----

----

|                         |                                                                                                                                                                                                                                                                                                                           |
|------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                         | COMMUNITY FIRST BANCORPORATION                                                                                                                                                                                                                                                                                                 |
|                         |                                                                                                                                                                                                                                                                                                                           |
| May 13, 2011                 | /s/ Frederick D. Shepherd, Jr.                                                 |
|     Date | Frederick D. Shepherd, Jr., Chief Executive Officer and                                                                                                                                                                                                                                                                        |
|                         | Chief Financial Officer                                                                                                                                                                                                                                                                                                        |

----

----