SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-QSB

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


     For Quarterly Period Ended June 30, 1998 Commission File No. 000-29640



                         COMMUNITY FIRST BANCORPORATION
--------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)


        SOUTH CAROLINA                                  58-2322486
---------------------------------             ---------------------------------
 (State or other jurisdiction of              (IRS Employer Identification No.)
  incorporation or organization)


                            3685 BLUE RIDGE BOULEVARD
                         WALHALLA, SOUTH CAROLINA 29691
--------------------------------------------------------------------------------
                    (Address of principal executive offices)


                                 (864) 638-2105
--------------------------------------------------------------------------------
                           (Issuer's telephone number)


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

           Yes [X] No [ ]


     State the number of shares  outstanding of each of the issuer's  classes of
common equity, as of the latest practicable date: Common Stock, no par or stated
value, 1,778,396 Shares Outstanding on July 31, 1998


Transitional Small Business Disclosure Format (Check one):  Yes  [ ]  No  [X]

                                       -1-

<PAGE>



                         COMMUNITY FIRST BANCORPORATION

                                   FORM 10-QSB


                                      Index

<TABLE>
<CAPTION>

                                                                                                                      Page

PART I -    FINANCIAL INFORMATION

Item 1.           Financial Statements

<S>                                                                                                                 <C>
                  Consolidated Balance Sheet ....................................................................       3
                  Consolidated Statement of Income ..............................................................       4
                  Consolidated Statement of Comprehensive Income ................................................       5
                  Consolidated Statement of Changes in Shareholders' Equity .....................................       6
                  Consolidated Statement of Cash Flows ..........................................................       7
                  Notes to Unaudited Consolidated Financial Statements ..........................................     8-9

Item 2.           Management's Discussion and Analysis ..........................................................   10-12


PART II -   OTHER INFORMATION

Item 4.           Submission of Matters to a Vote of Security Holders ...........................................      13

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


SIGNATURE .......................................................................................................      14
</TABLE>



                                       -2-

<PAGE>



                         PART I - FINANCIAL INFORMATION

Item 1. - Financial Statements


COMMUNITY FIRST BANCORPORATION

Consolidated Balance Sheet
<TABLE>
<CAPTION>

                                                                                            (Unaudited)
                                                                                              June 30,                  December 31,
                                                                                                1998                       1997
                                                                                            ------------                ------------
                                                                                                       (Dollars in thousands)
Assets
<S>                                                                                         <C>                           <C>      
  Cash and due from banks .................................................                 $      2,696                  $   4,834
  Federal funds sold ......................................................                        6,310                      6,510
  Available-for-sale securities ...........................................                       40,001                     25,510
  Other investments .......................................................                          345                        335
  Loans ...................................................................                       68,655                     65,838
    Less allowance for loan losses ........................................                       (1,006)                      (890)
                                                                                            ------------                  ---------
      Loans - net .........................................................                       67,649                     64,948
  Premises and equipment - net ............................................                        1,689                      1,675
  Accrued interest receivable .............................................                          905                        793
  Other assets ............................................................                          357                        363
                                                                                            ------------                  ---------

          Total assets ....................................................                 $    119,952                  $ 104,968
                                                                                            ============                  =========

Liabilities
  Deposits
    Noninterest bearing demand ............................................                 $     20,866                  $  16,501
    Interest bearing transaction accounts .................................                       11,120                     10,106
    Savings ...............................................................                       21,370                     16,191
    Time deposits $100M and over ..........................................                       23,179                     23,046
    Other time deposits ...................................................                       29,773                     26,446
                                                                                            ------------                  ---------
          Total deposits ..................................................                      106,308                     92,290
  Accrued interest payable ................................................                          775                        772
  Other liabilities .......................................................                          144                         56
                                                                                            ------------                  ---------
          Total liabilities ...............................................                      107,227                     93,118
                                                                                            ------------                  ---------

Shareholders' equity
  Common stock - no par value; 10,000,000
    shares authorized;  shares issued and
    outstanding 1,776,020 for 1998 and
    1,772,280 for 1997* ...................................................                       10,509                     10,479
  Retained earnings .......................................................                        2,246                      1,387
  Accumulated other comprehensive
    income (loss) .........................................................                          (30)                       (16)
                                                                                            ------------                  ---------
          Total shareholders' equity ......................................                       12,725                     11,850
                                                                                            ------------                  ---------

          Total liabilities and
            shareholders' equity ..........................................                 $    119,952                  $ 104,968
                                                                                            ============                  =========
</TABLE>
------------------------------------
*Number of shares has been  retroactively  adjusted  to reflect a 2-for-1  stock
split effective July 31, 1998.



See notes to unaudited consolidated financial statements.

                                       -3-

<PAGE>



COMMUNITY FIRST BANCORPORATION

Consolidated Statement of Income

<TABLE>
<CAPTION>

                                                                                                 (Unaudited)
                                                                                           Period Ended June 30,
                                                                              Three Months                         Six Months
                                                                         ----------------------              -----------------------
                                                                         1998              1997              1998              1997
                                                                        -------           ------            ------           -------
                                                                                  (Dollars in thousands, except per share)
Interest income
<S>                                                                     <C>               <C>               <C>               <C>   
  Loans, including fees ....................................            $1,538            $1,305            $3,020            $2,542
  Securities
    U.S. Treasury ..........................................                 5                70                29               143
    U.S. Government agencies ...............................               441               365               801               722
  Federal funds sold .......................................               257               157               540               394
  Other investments ........................................                 6                 -                 8                 -
                                                                        ------            ------            ------            ------
          Total interest income ............................             2,247             1,897             4,398             3,801
                                                                        ------            ------            ------            ------

Interest expense
  Time deposits $100M and over .............................               338               285               652               564
  Other deposits ...........................................               804               632             1,555             1,326
                                                                        ------            ------            ------            ------
          Total interest expense ...........................             1,142               917             2,207             1,890
                                                                        ------            ------            ------            ------

Net interest income ........................................             1,105               980             2,191             1,911
Provision for loan losses ..................................                60                81               125               146
                                                                        ------            ------            ------            ------
Net interest income after provision ........................             1,045               899             2,066             1,765
                                                                        ------            ------            ------            ------

Other income
  Service charges on deposit accounts ......................                89                77               173               143
  Credit life insurance commissions ........................                13                11                21                18
  Other income .............................................                40                73                78               107
                                                                        ------            ------            ------            ------
          Total other income ...............................               142               161               272               268
                                                                        ------            ------            ------            ------

Other expenses
  Salaries and employee benefits ...........................               280               255               532               474
  Net occupancy expense ....................................                24                23                47                52
  Furniture and equipment expense ..........................                46                41               100                76
  Other expense ............................................               169               183               325               323
                                                                        ------            ------            ------            ------
          Total other expenses .............................               519               502             1,004               925
                                                                        ------            ------            ------            ------

Income before income taxes .................................               668               558             1,334             1,108
Income tax expense .........................................               238               201               475               392
                                                                        ------            ------            ------            ------

Net income .................................................            $  430            $  357            $  859            $  716
                                                                        ======            ======            ======            ======

Per share*
  Net income ...............................................            $  .24            $  .20            $  .48            $  .41
  Net income, assuming dilution ............................               .23               .20               .46               .39
</TABLE>

*Per share  information  has been  retroactively  adjusted  to reflect a 2-for-1
 stock  split  effective  July 31,  1998,  and a 15%  stock  dividend  effective
 December 30, 1997.




See notes to unaudited consolidated financial statements.

                                       -4-

<PAGE>



COMMUNITY FIRST BANCORPORATION

Consolidated Statement of Comprehensive Income

<TABLE>
<CAPTION>

                                                                                                 (Unaudited)
                                                                                           Period Ended June 30,
                                                                                Three Months                       Six Months
                                                                           ---------------------             -----------------------
                                                                           1998             1997             1998             1997
                                                                           ----             ----            -----             ------
                                                                                           (Dollars in thousands)

<S>                                                                       <C>              <C>              <C>               <C>  
Net income ...................................................            $ 430            $ 357            $ 859             $ 716
                                                                          -----            -----            -----             -----
Other comprehensive income (loss)
  Change in unrealized holding gains
    and (losses) on available-
    for-sale securities ......................................              (55)              93              (21)              (13)
  Income tax expense (benefit)
    on other comprehensive income ............................              (19)              33               (7)               (5)
                                                                          -----            -----            -----             -----
        Total other comprehensive
          income (loss) ......................................              (36)              60              (14)               (8)
                                                                          -----            -----            -----             -----

Comprehensive income .........................................            $ 394            $ 417            $ 845             $ 708
                                                                          =====            =====            =====             =====
</TABLE>


































See notes to unaudited consolidated financial statements.

                                       -5-

<PAGE>



COMMUNITY FIRST BANCORPORATION

Consolidated Statement of Changes in Shareholders' Equity
<TABLE>
<CAPTION>

                                                                                 (Unaudited)

                                                     Common Stock                                        Accumulated
                                              Number                                                         Other
                                               of                           Capital        Retained     Comprehensive
                                             Shares*            Amount      Surplus        Earnings        Income         Total
                                             -------            ------      -------        --------        ------         -----
                                                                           (Dollars in thousands)                      
                                                                                                                       
<S>                                           <C>           <C>            <C>            <C>            <C>            <C>       
Balance January 1, 1997 .................     1,529,108     $    3,823     $    4,659     $    1,932     $      (79)    $   10,335
Net income for period ...................                                                        716                           716
Changes in unrealized holding gains                                                                                    
  and losses on available-for-sale                                                                                     
  securities, net of taxes                                                                                       (8)            (8)
Exercise of stock options ...............           296              1              1                                            2
                                             ----------     ----------     ----------     ----------     ----------     ----------
                                                                                                                       
Balance June 30, 1997 ...................     1,529,404     $    3,824     $    4,660     $    2,648     $      (87)    $   11,045
                                             ==========     ==========     ==========     ==========     ==========     ==========
                                                                                                                       
                                                                                                                       
                                                                                                                       
Balance January 1, 1998 .................     1,772,280     $   10,479     $              $    1,387     $      (16)    $   11,850
Net income for period ...................                                                        859                           859
Changes in unrealized holding gains                                                                                    
  and losses on available-for-sale                                                                                     
  securities, net of taxes ..............                                                                       (14)           (14)
Exercise of stock options ...............         6,116             30                                                          30
                                             ----------     ----------     ----------     ----------     ----------     ----------
                                                                                                                       
Balance June 30, 1998 ...................     1,778,396     $   10,509     $              $    2,246     $      (30)    $   12,725
                                             ==========     ==========     ==========     ==========     ==========     ==========
</TABLE>
                                                                                
--------------------------                                                      
*Number of shares has been  retroactively  adjusted  to reflect a 2-for-1  stock
split effected on July 31, 1998.                                                































See notes to unaudited consolidated financial statements.


                                       -6-

<PAGE>

COMMUNITY FIRST BANCORPORATION

Consolidated Statement of Cash Flows



<TABLE>
<CAPTION>

                                                                                                             (Unaudited)
                                                                                                          Six Months Ended
                                                                                                              June 30,
                                                                                                     1998                    1997
                                                                                                  --------                 ---------
                                                                                                         (Dollars in thousands)
Operating activities
<S>                                                                                               <C>                      <C>     
  Net income .....................................................................                $    859                 $    716
  Adjustments to reconcile net income to
    net cash provided by operating activities
      Provision for loan losses ..................................................                     125                      146
      Depreciation ...............................................................                      74                       56
      Amortization of net loan fees and costs ....................................                      24                       (6)
      Accretion and premium amortization .........................................                     (53)                      (9)
      Writedowns of other real estate ............................................                       -                       25
      Gain on sale of other real estate ..........................................                       -                      (45)
      Increase in interest receivable ............................................                    (112)                    (135)
      Increase (decrease) in interest payable ....................................                       3                     (199)
      Decrease (increase) in prepaid expenses ....................................                      13                     (144)
      Increase (decrease) in other accrued expenses ..............................                      88                      (19)
                                                                                                  --------                 --------
          Net cash provided by operating activities ..............................                   1,021                      386
                                                                                                  --------                 --------

Investing activities
  Maturities of available-for-sale securities ....................................                  15,454                    1,385
  Purchases of available-for-sale securities .....................................                 (29,913)                  (4,000)
  Purchase of other investments ..................................................                     (10)                       -
  Net increase in loans made to customers ........................................                  (2,850)                  (6,017)
  Proceeds from sale of other real estate ........................................                       -                       45
  Purchases of premises and equipment ............................................                     (88)                     (40)
                                                                                                  --------                 --------
          Net cash used by investing activities ..................................                 (17,407)                  (8,627)
                                                                                                  --------                 --------

Financing activities
  Net increase (decrease) in demand deposits,
    interest bearing transaction accounts
    and savings accounts .........................................................                  10,558                   (1,240)
  Net increase in certificates of
    deposit and other time deposits ..............................................                   3,460                    2,331
  Exercise of stock options ......................................................                      30                        2
                                                                                                  --------                 --------
          Net cash provided by financing activities ..............................                  14,048                    1,093
                                                                                                  --------                 --------

Decrease in cash and cash equivalents ............................................                  (2,338)                  (7,148)
Cash and cash equivalents, beginning .............................................                  11,344                   15,417
                                                                                                  --------                 --------
Cash and cash equivalents, ending ................................................                $  9,006                 $  8,269
                                                                                                  ========                 ========
</TABLE>









See notes to unaudited consolidated financial statements.


                                       -7-

<PAGE>

COMMUNITY FIRST BANCORPORATION

Notes to Unaudited Consolidated Financial Statements




Accounting  Policies - A summary of significant  accounting policies is included
in the  Company's  Annual  Report for the year ended  December  31, 1997 on Form
10-KSB filed with the Securities and Exchange Commission.

Management  Opinion - In the opinion of management,  the accompanying  unaudited
consolidated  financial statements of Community First Bancorporation reflect all
adjustments  which are necessary for a fair  presentation  of the results of the
periods presented. Such adjustments were of a normal, recurring nature.

Statement  of Cash  Flows -  Interest  paid on  deposits  and  other  borrowings
amounted  to  $2,204,000  for  the six  months  ended  June  30,  1998,  and was
$2,089,000  for the six months  ended June 30,  1997.  Income  tax  payments  of
$415,000 were made during the first six months of 1998,  and income tax payments
of $429,000 were made in the 1997 period. Non-cash investment security valuation
adjustments   totaling   $21,000  were  made  in  the  1998  period   decreasing
available-for-sale  securities,  and  a  related  shareholders'  equity  account
decreased by $14,000 and the associated  deferred  income taxes changed  $7,000.
During the 1997 period,  non-cash valuation  adjustments decreased securities by
$13,000, decreased shareholders' equity $8,000 and changed deferred income taxes
by $5,000.

Nonperforming  Loans - As of June 30, 1998,  there were  $109,000 in  nonaccrual
loans and $12,000 in loans 90 days or more past due as to  principal or interest
payments still accruing.

Earnings  Per  Share - The  Company  adopted  the  provisions  of  Statement  of
Accounting Standards No. 128, "Earnings per Share" during 1997, as required. All
prior years' figures are restated on a comparable  basis.  On June 18, 1998, the
Company's  Board  of  Directors  declared  a  two-for-one  stock  split  for all
shareholders of record on July 1, 1998. The stock split was effected on July 31,
1998.  Also,  on December  30,  1997, a 15% stock  dividend  was  effected.  The
presentation  of  numbers  of  shares  and  all  per  share  amounts  have  been
retroactively adjusted to reflect the stock split and stock dividend.

Basic earnings per common share is computed by dividing net income applicable to
common  shares by the  weighted  average  number of common  shares  outstanding.
Diluted  earnings per share are based on dividing  applicable  net income by the
weighted average number of common shares  outstanding and any dilutive potential
common shares and dilutive stock options.  It is assumed that all dilutive stock
options are  exercised at the beginning of each period and that the proceeds are
used to purchase  shares of the  Company's  common  stock at the average  market
price during the period. Net income per share and net income per share, assuming
dilution, were computed as follows:









                                       -8-

<PAGE>


<TABLE>
<CAPTION>

                                                                                             (Unaudited)
                                                                                        Period Ended June 30,
                                                                         Three Months                           Six Months
                                                                         ------------                           ----------
                                                                    1998               1997               1998               1997
                                                                 ----------         ----------         ----------         ----------
                                                                         (Dollars in thousands, except per share amounts)
Net income per share (basic)
<S>                                                              <C>                <C>                <C>                <C>       
  Numerator - net income ...............................         $      430         $      357         $      859         $      716
                                                                 ==========         ==========         ==========         ==========
  Denominator
    Weighted average common shares
      issued and outstanding ...........................          1,776,986          1,758,474          1,776,160          1,758,474
                                                                 ==========         ==========         ==========         ==========

          Net income per share (basic) .................         $      .24         $      .20         $      .48         $      .41
                                                                 ==========         ==========         ==========         ==========

Net income per share, assuming dilution
  Numerator - net income ...............................         $      430         $      357         $      859         $      716
                                                                 ==========         ==========         ==========         ==========
  Denominator
    Weighted average common shares
      issued and outstanding ...........................          1,776,986          1,758,474          1,776,160          1,758,474
    Effect of dilutive stock options ...................             78,664             70,568             76,140             63,462
                                                                 ----------         ----------         ----------         ----------
      Total ............................................          1,855,650          1,829,042          1,852,300          1,821,936
                                                                 ==========         ==========         ==========         ==========

          Net income per share,
            assuming dilution ..........................         $      .23         $      .20         $      .46         $      .39
                                                                 ==========         ==========         ==========         ==========
</TABLE>


                                       -9-

<PAGE>



Item 2. - Management's Discussion and Analysis

Forward Looking Statements

         Statements  included in Management's  Discussion and Analysis which are
not  historical  in nature are  intended  to be, and are  hereby  identified  as
"forward looking statements" for purposes of the safe harbor provided by Section
21E of the  Securities  Exchange Act of 1934, as amended.  The Company  cautions
readers that forward looking  statements,  including without  limitation,  those
relating to the Company's future business prospects,  revenues, working capital,
liquidity,  capital needs,  interest costs,  and income,  are subject to certain
risks and  uncertainties  that could cause actual  results to differ  materially
from those indicated in the forward looking statements, due to several important
factors herein identified,  among others, and other risks and factors identified
from  time to time in the  Company's  reports  filed  with  the  Securities  and
Exchange Commission.


Results of Operations

     Community  First  Bancorporation  (the  "Company")  recorded  net income of
$430,000 or $.24 per share for the second  quarter of 1998,  bringing net income
to  $859,000  or $.48 per share for the six months  ended June 30,  1998.  These
results compare  favorably with net income of $357,000 or $.20 per share for the
second  quarter of 1997 and  $716,000 or $.41 per share for the six months ended
June 30, 1997. Net income per share,  assuming dilution,  for the 1998 three and
six months periods ended June 30, 1998 was $.23 and $.46, respectively.  For the
comparable 1997 periods, net income per share,  assuming dilution,  was $.20 and
$.39, respectively. The net income per share figures for 1998 and 1997 have been
retroactively  adjusted to reflect a two-for-one  stock split effective July 31,
1998, and a 15% stock dividend effective December 30, 1997.


Net Interest Income

     Net interest income is the principal source of the Company's earnings.  For
the second  quarter of 1998,  net  interest  income was  $1,105,000.  This is an
increase of $125,000 or 12.8% over the  comparable  1997  quarter.  Net interest
income for the first six months of 1998 was $2,191,000, representing an increase
of $280,000 or 14.7% over the first six months of 1997. Both interest income and
interest expense  increased for the first six months of 1998,  compared with the
same period one year ago, primarily as a result of increased volumes of interest
earning assets and interest bearing liabilities. Average interest earning assets
for the first six months of 1998 were  $115,501,000,  an increase of $14,596,000
or 14.5%  over the  prior  year  level.  Average  interest  bearing  liabilities
increased to $87,143,000 for the first half of 1998, representing an increase of
$9,473,000 or 12.2% over the comparable period of the previous year. The average
interest rate spread (average yield on interest  earning assets less the average
rate paid on interest bearing  liabilities) for the first six months of 1998 was
2.60%,  a decrease of 9 basis from the prior year's 2.69%.  However,  because of
the greater  percentage and absolute dollar increases in interest earning assets
as compared with interest bearing  liabilities,  the net yield on earning assets
(net interest  income divided by average  interest  earning assets) for the 1998
period increased by 2 basis points compared with the prior year to 3.84%.

                                      -10-

<PAGE>




     The  increases  in  both  interest  earning  assets  and  interest  bearing
liabilities  resulted  from the  Company's  continuing  marketing  strategies to
increase  its market  share in its current  local  service  area  within  Oconee
County,  South  Carolina.   Management  expects  to  continue  to  utilize  such
strategies  during the remainder of 1998. In addition,  see the discussion under
"Noninterest  Expenses"  below  regarding  the  Company's  plans to expand  into
Anderson County, South Carolina.


Provision and Allowance for Loan Losses

     The provision for loan losses charged to expense was $60,000 for the second
quarter of 1998  compared with $81,000 for the second  quarter of 1997,  and was
$125,000 for the first six months of 1998  compared  with $146,000 for the first
six months of 1997.  At June 30, 1998 the  allowance  for loan  losses  stood at
1.47% of loans  compared  with 1.35% at the end of 1997. At the end of the first
half of 1998, nonaccrual loans totaled $109,000, and there were $12,000 in loans
that were 90 days or more  past due and  still  accruing  interest  income.  The
majority of the nonaccrual loans were secured by real estate.

         Management  believes  that the allowance for loan losses is adequate to
absorb all estimated  future risk of loss  inherent in the loan  portfolio as of
June 30, 1998.


Noninterest Income

         Noninterest  income  totaled  $142,000  for the second  quarter of 1998
compared with $161,000 for the comparable 1997 quarter.  Noninterest  income was
$272,000 for the first six months of 1998  compared  with  $268,000 for the 1997
period.  The  decrease of $19,000 in other  income for the three months ended in
1998 resulted  primarily  from the  nonrecurring  sale of other real estate at a
gain of $45,000 during the 1997 period.


Noninterest Expenses

         Noninterest  expenses  totaled $519,000 for the second quarter of 1998,
compared with $502,000 for 1997.  Noninterest  expenses were  $1,004,000 for the
first six  months of 1998  compared  with  $925,000  for the first half of 1997.
Salaries and employee  benefits  were up $25,000 for the second  quarter of 1998
and $58,000 for the first half of 1997.  Part of the increase in salaries is due
to the  hiring of  additional  personnel  necessary  to meet the  demands of the
Company's  expanding  customer  base.  Net  occupancy  expense and furniture and
equipment  expenses  increased $19,000 during the first half of 1998 as a result
of the  depreciation,  maintenance  and training  expenses  associated  with the
installation of a new computer system and software  completed late in the second
quarter of 1997.  Furniture and  equipment  expenses are expected to continue to
increase throughout 1998 as compared with 1997.

         In July,  1998, the Company's  banking  subsidiary filed an application
with  regulatory  authorities  to place a branch office in the city of Anderson,
South Carolina, which is located in an adjacent county. The Company's entry into
this new market area on a de novo basis will increase operating expenses in most
categories,  and is expected to initially have a negative  effect on net income.
This trend is

                                      -11-

<PAGE>



expected to continue until the new office acquires a sufficiently large customer
base and attains the volumes of deposits and interest  earning assets that would
enable it to  contribute to the Company's  profitability.  Management  currently
estimates  that  capital  expenditures  needed to open the new office will total
approximately  $1,330,000.  Subject to regulatory  approval of the  application,
management  expects to open for  business a temporary  office  during the fourth
quarter of 1998, with  completion of the  construction of the new office to come
late in the second quarter of 1999.


 Liquidity

     Liquidity  is the ability to meet  current and future  obligations  through
liquidation  or maturity of existing  assets or the  acquisition  of  additional
liabilities.  The  Company  manages  both  assets  and  liabilities  to  achieve
appropriate  levels  of  liquidity.  Cash  and  short-term  investments  are the
Company's  primary  sources of asset  liquidity.  These funds  provide a cushion
against  short-term  fluctuations  in cash flow from both  deposits  and  loans.
Securities  available-for  sale are the Company's  principal source of secondary
asset  liquidity.  However,  the  availability  of this source is  influenced by
market conditions.  Individual and commercial deposits are the Company's primary
source of funds for credit activities.

As of June 30, 1998, the ratio of loans to total deposits was 64.6%.  Management
believes that the Company's liquidity sources are adequate to meet its operating
needs.


Capital Resources

     The capital base for the Company  increased by $875,000  since December 31,
1997 as the  result of the  $859,000  of net  income for the first six months of
1998,  less  $14,000 for the change in  unrealized  holding  gains and losses on
available-for-sale securities, plus the addition of $30,000 from the exercise of
employees' stock options.

         The Company and its banking subsidiary (the "Bank") are each subject to
regulatory  risk-based capital adequacy standards.  Under these standards,  bank
holding  companies and banks are required to maintain  certain minimum ratios of
capital to risk-weighted  assets and average total assets.  Under the provisions
of the Federal Deposit Insurance  Corporation  Improvement Act of 1991 (FDICIA),
federal bank regulatory authorities are required to implement prescribed "prompt
corrective actions" upon the deterioration of the capital position of a bank. If
the  capital  position  of an affected  institution  were to fall below  certain
levels, increasingly stringent regulatory corrective actions are mandated.

         The June 30,  1998  risk-based  capital  ratios for the Company and the
Bank are presented in the following table,  compared with the "well capitalized"
and minimum ratios under the regulatory definitions and guidelines:

                                                          Total
                                             Tier 1      Capital     Leverage
                                             ------      -------     --------

Community First Bancorporation                18.6%        19.8%        10.5%
Community First Bank                          18.2%        19.4%        10.3%
Minimum "well capitalized" requirement         6.0%        10.0%         5.0%
Minimum requirement                            4.0%         8.0%         3.0%



                                      -12-

<PAGE>




                           PART II - OTHER INFORMATION

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

         On  Tuesday,  April 28,  1998,  the  shareholders  of  Community  First
Bancorporation  held their regular annual meeting.  At the meeting,  two matters
were submitted to a vote with results as follows:

1. Election of three directors to hold office for three-year terms:

                                          SHARES VOTED
                                          ------------
                                                     AUTHORITY
    DIRECTORS                        FOR*            WITHHELD*
    ---------                        ----            ---------

Blake L. Griffith                 1,175,306             276
Robert H. Edwards, Sr.            1,175,262             320
Gary V. Thrift                    1,175,582               -

     The  following  directors  continue to serve until the  expiration of their
terms at the annual  meetings  to be held in the years  indicated,  and were not
voted on at the annual  meeting:  R. Theo Harris,  Sr. - 1999,  James E. McCoy -
1999,  James E. Turner - 1999,  Charles L. Winchester - 1999,  Larry S. Bowman -
2000,  William M. Brown - 2000,  John R. Hamrick - 2000,  Frederick D. Shepherd,
Jr. - 2000.

2. Adoption of the 1998 Stock Option Plan.

    FOR - 1,159,080 shares*   AGAINST - 7,380 shares*   ABSTAIN - 20,292 shares*
--------------------
*Number  of  shares  voted  has  been  retroactively  adjusted  to  reflect  the
 two-for-one stock split effected on July 31, 1998.


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

(a)  Exhibits

     Exhibit No.
     from Item 601 of
     Regulation S-B                          Description
     --------------                          -----------

           27                             Financial Data Schedule

(b)  Reports on Form 8-K.  None.

                                      -13-

<PAGE>



SIGNATURE

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


                                    COMMUNITY FIRST BANCORPORATION


    August 11, 1998              /s/Frederick D. Shepherd, Jr.
    ---------------              -----------------------------------------------
        Date                     Frederick D. Shepherd, Jr., President and Chief
                                 Executive Officer (also principal accounting
                                                     officer)









































                                      -14-


<PAGE>




                                  EXHIBIT INDEX


     Exhibit No.
     from Item 601 of
     Regulation S-B                           Description
     --------------                           -----------

           27                             Financial Data Schedule