UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark  One)

{  X  }   Quarterly  Report Under Section 13 or 15(d) of the Securities Exchange
          Act  of  1934  For  the  Quarterly  Period Ended March 31, 2001 or

{      }   Transition  Report  Pursuant to Section 13 or 15(d) of the Securities
           Exchange  Act  of  1934  For  the Transition period from___________
           To  ___________

Commission  File  Number:  0-23605


                              CAVALRY BANCORP, INC.
                              ---------------------
             (exact name of registrant as specified in its charter)


             Tennessee                                   62-1721072
             ---------                             --------------------
     (State  or  other  jurisdiction                 (I.R.S.  Employer
      of incorporation or organization)                 I.D.  Number)

114  West  College  Street,  Murfreesboro,  Tennessee         37130
-----------------------------------------------------      ------------
    (Address  of  principal  executive  offices)            (Zip  Code)

                                     (615) 893-1234
                                  ---------------------
                   Registrant's telephone number, including area code

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

                    Yes  X                    No
                        --                       --

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

Common  Stock  Issued  and  Outstanding:  7,104,801  as  of  May  9,  2001.

<PAGE>


                              CAVALRY BANCORP, INC.

                                Table of Contents

Part  I   Financial  Information                                            Page

Item  1.  Financial  Statements

          Consolidated Balance Sheets at March 31, 2001 (unaudited)
          and  December  31,  2000                                             1

          Consolidated Statements of Income (unaudited) for the Three Months
          Ended  March  31,  2001  and  2000                                   2

          Consolidated  Statements  of  Comprehensive  Income  (unaudited)
          for  the Three  Months  Ended  March  31,  2001  and  2000           3

          Consolidated  Statements  of  Cash  Flows  (unaudited) for the
          Three Months Ended  March  31,  2001  and  2000                      4

          Notes  to  Consolidated  Financial  Statements  (unaudited)        5-6

Item  2.  Management's  Discussion  and  Analysis  of  Financial
          Condition  and  Results  of  Operations                            7-9

Item  3.  Quantitative and Qualitative Disclosures About Market Risk        9-10

Part II   Other  Information                                                  11

Signatures                                                                    12



<PAGE>
Part  I.     Financial  Information

ITEM  1.                 FINANCIAL  STATEMENTS

<TABLE>
<CAPTION>


                                       CAVALRY BANCORP, INC.
                                    CONSOLIDATED BALANCE SHEETS
                          MARCH 31, 2001 (UNAUDITED) AND DECEMBER 31, 2000
                                       (DOLLARS IN THOUSANDS)


                                                                              March 31  December 31
ASSETS                                                                          2001       2000
--------------------------------------------------------------------------   --------   -----------
                                                                            (Unaudited)
<S>                                                                            <C>        <C>
Cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 19,977   $ 18,025
Interest-bearing deposits with other financial institutions . . . . . . . . .    35,121     27,000
                                                                               ---------  ---------
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . .    55,098     45,025
Investment securities available-for-sale at fair value (amortized cost: . . .    40,628     32,247
 $40,274 and $32,096 at March 31, 2001 and December 31, 2000, respectively)
Mortgage-backed securities held to maturity - at amortized cost (fair value:.       582        594
  $576 and $589 at March 31, 2001 and December 31, 2000, respectively)
Loans held for sale, at estimated fair value. . . . . . . . . . . . . . . . .    11,490      4,183
Loans receivable, net . . . . . . . . . . . . . . . . . . . . . . . . . . . .   278,277    279,478
Accrued interest receivable . . . . . . . . . . . . . . . . . . . . . . . . .     2,582      2,559
Office properties and equipment, net. . . . . . . . . . . . . . . . . . . . .    15,524     15,255
Federal Home Loan Bank of Cincinnati stock - at cost. . . . . . . . . . . . .     2,056      2,020
Real estate and other assets acquired in settlement of loans. . . . . . . . .        73         86
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     2,423      2,838
                                                                               ---------  ---------
Total assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $408,733   $384,285
                                                                               =========  =========

                                  LIABILITIES AND EQUITY
-----------------------------------------------------------------------------
Liabilities:
Deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $359,704   $336,534
Borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     1,039      1,578
Accounts payable and other liabilities. . . . . . . . . . . . . . . . . . . .     2,738      2,202
                                                                               ---------  ---------
               Total liabilities. . . . . . . . . . . . . . . . . . . . . . .   363,481    340,314
                                                                               ---------  ---------
Equity:
Preferred stock, no par value
  Authorized- 250,000 shares; none issued or outstanding at
     March 31, 2001 and December 31, 2000 . . . . . . . . . . . . . . . . . .         -          -
Common stock, no par value
  Authorized- 49,750,000 shares; issued and outstanding
     7,104,801 at March 31, 2001 and December 31, 2000. . . . . . . . . . . .    11,599     11,489
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    40,639     39,991
Unearned restricted stock . . . . . . . . . . . . . . . . . . . . . . . . . .    (2,982)    (3,224)
Unallocated ESOP Shares . . . . . . . . . . . . . . . . . . . . . . . . . . .    (4,223)    (4,380)
Accumulated other comprehensive income, net of tax. . . . . . . . . . . . . .       219         95
                                                                               ---------  ---------

Total equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    45,252     43,971
                                                                               ---------  ---------
Total liabilities and equity. . . . . . . . . . . . . . . . . . . . . . . . .  $408,733   $384,285
                                                                               =========  =========
</TABLE>


Note:  The  balance sheet at December 31, 2000 has been derived from the audited
financial  statements  at  that date but does not include all of the information
and  footnotes required by generally accepted accounting principles for complete
financial  statements.

See  accompanying  notes  to  consolidated  financial  statements.

                                        1
<PAGE>
<TABLE>
<CAPTION>


                              CAVALRY BANCORP, INC.
                        CONSOLIDATED STATEMENTS OF INCOME
                  (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                   (UNAUDITED)

                                                Three  Months  Ended
                                                     March  31,
                                                   2001        2000
                                                   ----        ----
<S>                                           <C>         <C>
Interest and dividend income:
 Loans . . . . . . . . . . . . . . . . . . .  $    6,492  $    6,128
 Investment securities . . . . . . . . . . .         574         292
 Deposits with other financial institutions.         424         549
 Mortgage-backed securities held to maturity          10          10
                                              ----------  ----------
       Total interest and dividend income. .       7,500       6,979
                                              ----------  ----------
Interest expense - deposits. . . . . . . . .       3,628       2,978
Interest expense - borrowings. . . . . . . .          14         130
                                              ----------  ----------
      Total interest expense . . . . . . . .       3,642       3,108
                                              ----------  ----------
 Net interest income . . . . . . . . . . . .       3,858       3,871
 Provision for loan losses . . . . . . . . .         103          74
                                              ----------  ----------
  Net interest income after provision
     for loan losses . . . . . . . . . . . .       3,755       3,797
                                              ----------  ----------
Non-interest income:
  Servicing income . . . . . . . . . . . . .          75          64
  Gain on sale of loans, net . . . . . . . .         403         314
  Deposit servicing fees and charges . . . .         822         561
  Trust service fees . . . . . . . . . . . .         293         267
  Other operating income . . . . . . . . . .         169         138
                                              ----------  ----------
    Total non-interest income. . . . . . . .       1,762       1,344
                                              ----------  ----------
 Non-interest expenses:
   Compensation, payroll taxes and
     fringe benefits . . . . . . . . . . . .       2,345       2,338
   Occupancy expense . . . . . . . . . . . .         239         156
   Supplies, communications and other
     office expenses . . . . . . . . . . . .         229         211
   Federal insurance premiums. . . . . . . .          16          15
   Advertising expense . . . . . . . . . . .          96          90
   Equipment and service bureau expense. . .         552         498
   Other operating expenses. . . . . . . . .         379         378
                                              ----------  ----------
      Total non-interest expenses. . . . . .       3,856       3,686
                                              ----------  ----------
  Earnings before income tax expense . . . .       1,661       1,455
  Income tax expense . . . . . . . . . . . .         704         627
                                              ----------  ----------
     Net income. . . . . . . . . . . . . . .  $      957  $      828
                                              ==========  ==========

Basic and diluted earnings per share . . . .  $     0.15  $     0.13
                                              ==========  ==========

Weighted average shares outstanding-Basic. .   6,444,654   6,340,984
                                              ==========  ==========

Weighted average shares outstanding-Diluted.   6,458,994   6,340,984
                                              ==========  ==========
</TABLE>


Dividends  declared  $0.05  per share payable April 13, 2001 for shareholders of
record  date  March  31,  2001.

See  accompanying  notes  to  consolidated  financial  statements.

                                        2
<PAGE>

<TABLE>
<CAPTION>


                              CAVALRY BANCORP, INC.
                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                             (DOLLARS IN THOUSANDS)
                                   (UNAUDITED)

                                            Three
                                         Months Ended
                                           March  31,
                                           2001   2000
                                           ----   ----


<S>                                      <C>     <C>

Net income. . . . . . . . . . . . . . .  $  957  $828
Other comprehensive income, net of tax
Unrealized gains (losses) on securities
 available for sale . . . . . . . . . .     124   (26)
                                         ------  -----

Comprehensive income. . . . . . . . . .  $1,081  $802
                                         ======  =====
</TABLE>

See  accompanying  notes  to  consolidated  financial  statements.

                                        3
<PAGE>
<TABLE>
<CAPTION>


                              CAVALRY BANCORP, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                   THREE MONTHS ENDED MARCH 31, 2001 AND 2000
                             (DOLLARS IN THOUSANDS)
                                   (UNAUDITED)


                                                           2001     2000
                                                           ----     ----
<S>                                                   <C>        <C>

Operating activities:
          Net cash used by operating activities. . .   ($4,958)   ($1,601)
                                                      ---------  ---------
Investing activities:
   Decrease (increase) in loans receivable, net. . .     1,191     (1,132)
   Principal payments on mortgage
        backed securities held to maturity . . . . .        11         15
  Purchase of investment securities
     available for sale. . . . . . . . . . . . . . .   (14,496)   (21,843)
  Proceeds from maturities of investment securities.     6,350      5,000
   Purchase of office properties and equipment . . .      (553)    (2,636)
                                                      ---------  ---------
          Net cash used in investing activities. . .    (7,497)   (20,596)
                                                      ---------  ---------

Financing activities:
  Net increase in deposits . . . . . . . . . . . . .    23,170     12,040
  Dividends paid . . . . . . . . . . . . . . . . . .      (310)      (355)
  Net decrease in borrowings . . . . . . . . . . . .      (539)   (43,385)
Payments by borrowers for
  property taxes and insurance . . . . . . . . . . .       207        226
                                                      ---------  ---------
         Net cash provided by (used in)
          financing activities . . . . . . . . . . .    22,528    (31,474)
                                                      ---------  ---------
Increase (decrease) in cash and cash equivalents . .    10,073    (53,671)
Cash and equivalents, beginning of period. . . . . .    45,025     94,422
                                                      ---------  ---------

 Cash and cash equivalents, end of period. . . . . .  $ 55,098   $ 40,751
                                                      =========  =========

SUPPLEMENT DISCLOSURES OF CASH
   FLOW INFORMATION:
Payments during the period for:
Interest . . . . . . . . . . . . . . . . . . . . . .  $  3,553   $  3,045
                                                      =========  =========
Income taxes . . . . . . . . . . . . . . . . . . . .  $      -   $    981
                                                      =========  =========

SUPPLEMENTAL DISCLOSURES OF NONCASH
  INVESTING AND FINANCING ACTIVITIES:

 Interest credited to deposits . . . . . . . . . . .  $  1,270   $  1,045
                                                      =========  =========
 Increase (decrease) in deferred tax asset related
   to unrealized loss on investments . . . . . . . .  $     77   $     17
                                                      =========  =========
Net unrealized gain (losses) on investment
    securities available for sale. . . . . . . . . .  $    201   $    (43)
                                                      =========  =========
Dividends declared and payable . . . . . . . . . . .  $    355   $    355
                                                      =========  =========
</TABLE>

See  accompanying  notes  to  consolidated  financial  statements.

                                        4
<PAGE>
                              CAVALRY BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.     Basis  of  Presentation

Cavalry  Bancorp,  Inc. (the "Company"), a Tennessee corporation, is the holding
company  for  Cavalry  Banking (the "Bank") which is a federally chartered stock
savings  bank.

The  accompanying  consolidated  financial  statements  of the Company have been
prepared in accordance with Instructions to Form 10-Q.  Accordingly, they do not
include  all  of  the  information  and footnotes required by generally accepted
accounting  principles  for  complete  financial  statements.  However,  such
information  reflects  all  adjustments  (consisting  solely of normal recurring
adjustments)  which  are,  in  the  opinion  of management, necessary for a fair
statement  of  results  for  the  interim  periods.

The  results  of  operations  for the three months ended March 31, 2001, are not
necessarily  indicative  of  the  results  to  be  expected  for the year ending
December  31,  2001.  The  consolidated  financial  statements and notes thereto
should  be  read  in conjunction with the audited financial statements and notes
thereto  for  the  year  ended  December  31,  2000.

2.     Earnings  Per  Share

The  following  schedule reconciles the numerators and denominators of the basic
and  diluted  earnings per share ("EPS") computations for the three-months ended
March  31,  2001  and  2000.  Diluted  common  shares arise from the potentially
dilutive  effect  of  the  Company's  stock  options  outstanding.
<TABLE>
<CAPTION>


                                  Quarter  Ended  March  31
                                  -------------------------
                                         2001         2000
                                         ----         ----

<S>                                  <C>         <C>
Basic EPS:
Net income. . . . . . . . . . . . .  $  957,000  $  828,000
Average common shares outstanding .   6,444,654   6,340,984
                                     ----------  ----------

Earnings per share. . . . . . . . .  $     0.15  $     0.13
                                     ==========  ==========

Diluted EPS:
Net income. . . . . . . . . . . . .  $  957,000  $  828,000
                                     ----------  ----------

Average common shares outstanding .   6,444,654   6,340,984
Dilutive effect of stock options. .      14,340           -
                                     ----------  ----------

Average dilutive shares outstanding   6,458,994   6,340,984
                                     ----------  ----------

Earnings per share. . . . . . . . .  $     0.15  $     0.13
                                     ==========  ==========
</TABLE>



                                        5
<PAGE>

3.     Business  Segments

The  Company and its subsidiaries provide community oriented banking services to
individuals  and  businesses primarily within Rutherford and Bedford counties in
Middle  Tennessee.

The  Company's  segments  are  identified  by the products and services offered,
principally  distinguished  as  banking,  trust and mortgage banking operations.
The  majority  of  loans  originated for sale are sold with the servicing rights
attached.  One  unrelated  entity  purchased approximately 50% of mortgage loans
sold  in  2000  and  2001.

Segment  information  is  derived from the internal reporting system utilized by
management  with  accounting  policies  and  procedures  consistent  with  those
described  in  Note  1  of  the  2000  Annual  Report  to Shareholders.  Segment
performance  is  evaluated  by the Company based on profit or loss before income
taxes.  Revenue,  expense,  and  asset  levels  reflect  those  which  can  be
specifically  identified  and  those  assigned  based  on  internally  developed
allocation  methods.  These  methods  have  been  consistently  applied.

<TABLE>
<CAPTION>

<S>                                 <C>        <C>        <C>     <C>
                                                Mortgage
                                      Banking    Banking    Trust   Consolidated
For the quarter ended
March 31, 2001
Interest revenue . . . . . . . . .  $   7,500  $      -   $    -  $       7,500
Other income-external customers. .        991        75      293          1,359
Interest expense . . . . . . . . .      3,642         -        -          3,642
Depreciation and amortization. . .        224        41        8            273
Other significant items:
    Provision for loan losses. . .        103         -        -            103
    Gain (loss) on sales of assets          -       403        -            403
Segment profit . . . . . . . . . .      1,593        (6)      74          1,661
Segment assets . . . . . . . . . .    396,860    11,490      383        408,733
</TABLE>

<TABLE>
<CAPTION>

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

                                             Mortgage
                                   Banking    Banking    Trust   Consolidated
For the quarter ended
March 31, 2000
Interest revenue. . . . . . . .  $   6,979  $      -   $    -  $       6,979
Other income-external customers        699        64      267          1,030
Interest expense. . . . . . . .      3,108         -        -          3,108
Depreciation and amortization .        172        33        9            214
Other significant items:
   Provision for loan losses. .         74         -        -             74
   Gain on sales of assets. . .          -       314        -            314
Segment profit. . . . . . . . .      1,440       (52)      67          1,455
Segment assets. . . . . . . . .    357,634     6,496      397        364,527
</TABLE>

                                        6
<PAGE>

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

Private  Securities  Litigation  Reform  Act  Safe  Harbor  Statement

This  Quarterly Report contains forward-looking statements within the meaning of
the  federal securities laws.  These statements are not historical facts, rather
statements  based  on  the Company's current expectations regarding its business
strategies  and  their  intended  results  and  its  future  performance.
Forward-looking  statements are preceded by terms such as "expects," "believes,"
"anticipates,"  "intends,"  and  similar  expressions.

Forward-looking  statements  are not guarantees of future performance.  Numerous
risks  and  uncertainties could cause the Company's actual results, performance,
and  achievements  to be materially different from those expressed or implied by
the  forward-looking  statements.  Factors that may cause or contribute to these
differences  include, without limitation, general economic conditions, including
changes  in market interest rates and changes in monetary and fiscal policies of
the  federal  government;  legislative and regulatory changes; and other factors
disclosed periodically in the Company's filings with the Securities and Exchange
Commission.

Because  of  the risks and uncertainties inherent in forward-looking statements,
readers  are  cautioned not to place undue reliance on them, whether included in
this report or made elsewhere from time to time by the Company or on its behalf.
The  Company  assumes  no  obligation  to update any forward-looking statements.

Comparison  of  Financial  Condition  at  March  31,  2001 and December 31, 2000

Total  assets  were $408.7 million at March 31, 2001, compared to $384.3 million
at  December  31, 2000, an increase of $24.4 million or 6.35%.  This increase in
assets  was  funded by increased deposits and equity.  Cash and cash equivalents
increased from $45.0 million at December 31, 2000, to $55.1 million at March 31,
2001.  Investments  available  for sale increased from $32.2 million at December
31,  2000,  to  $40.6 million at March 31, 2001.  Loans receivable net decreased
$1.2  million  from  $279.5  million  at December 31, 2000, to $278.3 million at
March  31, 2001. Office properties and equipment increased from $15.3 million at
December  31,  2000  to  $15.5  million  at  March  31,  2001.

Deposit  accounts  increased  $23.2  million from $336.5 million at December 31,
2000,  to  $359.7  million at March 31, 2001.  Certificates of deposit increased
$4.8  million  from  $162.5  million  at December 31, 2000, to $167.3 million at
March  31,  2001.  Savings deposits increased $1.0 million from $13.2 million at
December  31,  2000,  to $14.2 million at March 31, 2001.  Money market accounts
increased  $10.0  million  from  $69.8  million  at  December 31, 2000, to $79.8
million at March 31, 2001.  NOW accounts declined slightly from $52.3 million at
December  31,  2000,  to  $51.7 million at March 31, 2001.  Non interest-bearing
accounts  increased  $8.2  million  from  $38.6 million at December 31, 2000, to
$46.8  million at March 31, 2001.  These increases were primarily a result of an
ongoing  effort  to  raise  the  deposit  base  for  the  Bank.

Equity  increased  by  $1.3  million from $44.0 million at December 31, 2000, to
$45.3  million  at March 31, 2001, as a result of net income of $957,000 for the
three  months  ended  March  31,  2001,  release  of ESOP shares of $267,000 and
release  of  Management  Recognition  Plan  (MRP)  shares  of  $242,000  and  an
unrealized  gain  on  available  for  sale  securities of $124,000 net of taxes.
These  increases  were  offset  by  dividends  declared  of  $310,000.

Non-performing  assets  were $209,000 at December 31, 2000 and $243,000 at March
31,  2001.

                                        7
<PAGE>

Comparison  of  Operating  Results for the Three Months Ended March 31, 2001 and
March  31,  2000.

Net  Income.  Net  income was $957,000 for the three months ended March 31, 2001
compared  to  $828,000 for the three months ended March 31, 2000.  This increase
was primarily a result of higher interest income and higher non-interest income.
These  increases  were  partially  offset  by  higher  interest  expense, higher
non-interest  expenses  and  a  larger  provision  for loan losses.  The Company
expects  to  see downward pressure on earnings as a result of interest rate cuts
by  the  Federal  Reserve Board.  As a result of these Fed rate cuts, banks have
cut the prime rate in a similar manner.  The majority of the Bank's construction
loan  portfolio  is tied to this prime rate and adjusts immediately with changes
in the prime rate.  These declines have a short-term negative impact on interest
income.

Net  Interest Income.  Net interest income remained constant at $3.8 million for
the  quarters  ended  March  31,  2000  and  2001.  The  ratio  of  average
interest-earning  assets  to average interest-bearing liabilities decreased from
116.41%  for  the  three  months  ended March 31, 2000, to 116.15% for the three
months  ended  March  31,  2001.

Interest income increased 7.14% to $7.5 million for the three months ended March
31,  2001,  from  $7.0  million  for the same period in 2000.  Interest on loans
increased  from  $6.1 million for the three months ended March 31, 2000, to $6.5
million  for  the  same  period  in  2001.  This  was  a result of average loans
outstanding  increasing from $274.7 million for the three months ended March 31,
2000,  to  $283.4  million  for  the  same  period  in  2001.  The average yield
increased from 8.92% for the three months ended March 31, 2000, to 9.29% for the
same  period  in  2001  as  a result of increased amortization of deferred fees.
Income  on  all  other  investments  consisting  of  mortgage backed securities,
investments, FHLB stock, bank deposits and federal funds increased from $851,000
for  the  three months ended March 31, 2000, to $1.0 million for the same period
in  2001.  Average investments increased from $56.4 million for the three months
ended March 31, 2000, to $67.8 million for the same period in 2001.  The average
yield  decreased  from 6.06% for the three months ended March 31, 2000, to 6.03%
for  the  same  period  in  2001.

Interest  expense  increased  from $3.1 million for the three months ended March
31,  2000,  to  $3.9  million  for  the  same  period in 2001.  Average deposits
increased  from  $275.6  million  for  the three months ended March 31, 2000, to
$300.9  million  for  the  same  period  in 2001.  This increase was a result of
continuing  efforts  to  increase market share of deposits.  The average cost of
deposits  increased  from  4.35%  for  the three months ended March 31, 2000, to
4.89%  for  the  same  period  in  2001.  Average borrowings decreased from $8.9
million at an average cost of 5.90% for the three months ended March 31, 2000 to
$1.5  million  at  an average cost of 3.70% for the three months ended March 31,
2001.  The  total  cost of funds increased from 4.43% for the three months ended
March  31,  2000,  to  4.88% for the three months ended March 31, 2001.  Average
interest-bearing  liabilities increased from $284.5 million for the three months
ended  March  31, 2000, to $302.4 million for the same period in 2001.  Interest
rate  spread  decreased from 4.00% for the three months ended March 31, 2000, to
3.78% for the same period in 2001.  Net interest margin decreased from 4.68% for
the  three  months  ended  March 31, 2000, to 4.45% for the same period in 2001.

Provision for Loan Losses.  Provision for loan losses are charges to earnings to
bring the total allowance for loan losses to a level considered by management as
adequate  to  provide for estimated loan losses based on management's evaluation
of  the  collectibility  of  the  loan  portfolio,  including  the nature of the
portfolio, credit concentrations, trends in historical loss experience, specific
impaired  loans and economic conditions.  Management also considers the level of
problem  assets, giving greater weight to the level of classified assets than to
the  level  of  nonperforming  assets because classified assets include not only
nonperforming  assets  but  also  performing  assets  that otherwise exhibit, in
management's  judgment,  potential  credit  weaknesses.

The  provision for loan losses increased from $74,000 for the three months ended
March  31,  2000  to  $103,000  for  the three months ended March 31, 2001.  The
increase  in  the  provision  was primarily a result of increases in total loans
outstanding  between  the two periods.  Management deemed the allowance for loan
losses  adequate  at  March  31,  2001.

Non-interest  Income.  Non-interest  income  increased from $1.3 million for the
three  months ended March 31, 2000, to $1.8 million for the same period in 2001.
In  the  mortgage  banking  segment,  net  gain  on sale of loans increased from
$314,000  for  the  three  months ended March 31, 2000, to $403,000 for the same
period  in  2001.  The  higher gain in 2001 was a result of increased production
and  mortgage refinancing activity.  Loan servicing fees increased slightly from
$64,000  for  the  three  months  ended  March 31, 2000, to $75,000 for the same
period  in  2001.  In  the  banking  segment,  deposit  fees and other operating
incomes  increased  from  $699,000 for the three months ended March 31, 2000, to
$991,000  for  the same period in 2001.  This increase was a result of growth in
the  number  of  transaction  accounts  and  increased  charges.  The  Bank also
implemented  an  overdraft  privilege  program  coupled with a new free checking
account  program.  These  factors  also helped to increase deposit and overdraft
fees.  In  the  trust  segment, trust fees increased from $267,000 for the three
months ended March 31, 2000, to $293,000 for the same period in 2001 as a result
of  increased  trust  assets  under  management.

                                        8
<PAGE>

Non-interest  Expense.  Non-interest expense increased from $3.7 million for the
three  months ended March 31, 2000, to $3.9 million for the same period in 2001.
Compensation  and  other employee benefits were constant at $2.3 million for the
three  months  ended March 31, 2000 and 2001.  The increase in occupancy expense
was  primarily  a  result  of  the  opening  of  the new operations building and
increases  in  the  cost  of  utilities.  The  increases  in other expenses were
primarily  due  to  increased  loan  and  deposit  activity.

Income  taxes.  The provision for income taxes was $704,000 for the three months
ended  March  31,  2001, compared to $627,000 for the same period in 2000.  This
increase  was  primarily  a  result  of  higher  income  before  taxes.

Liquidity  and  Capital  Resources

The Company's primary sources of funds are customer deposits, proceeds from loan
principal  and interest payments, sale of loans, maturing securities and Federal
Home  Loan  Bank  (FHLB) of Cincinnati advances.  While maturities and scheduled
amortization  of  loans  are  a  predictable  source of funds, deposit flows and
mortgage  prepayments  are  influenced  greatly by general interest rates, other
economic  conditions,  and  competition.  Regulations  of  the  Office of Thrift
Supervision  ("OTS"), the Bank's primary regulator, require the Bank to maintain
an  adequate  level  of  liquidity  to  ensure  the  availability  of sufficient
liquidity  to  fund  loan originations, deposit withdrawals and to satisfy other
financial  commitments.  Currently, the OTS regulatory liquidity for the Bank is
the  maintenance of an average daily balance of liquid assets (cash and eligible
investments)  equal  to  at  least  4%  of  the  daily balance of net withdrawal
deposits  and  short-term  borrowings.  This liquidity requirement is subject to
periodic  change.  The  Company  and the Bank generally maintain sufficient cash
and  short-term  investments  to  meet short-term liquidity needs.  At March 31,
2001, cash and cash equivalents totaled $55.1 million or 13.48% of total assets,
and  investments  available-for-sale  totaled $40.6 million.  At March 31, 2001,
the  Bank also maintained, but did not draw upon, a line of credit with the FHLB
of  Cincinnati  in  the  amount  of  $10.0  million.

As  of  March  31,  2001,  the  Bank's  regulatory  capital was in excess of all
applicable regulatory requirements.  At March 31, 2001, under regulations of the
OTS, the Bank's actual tangible, core and risk-based capital ratios were 10.45%,
10.45%  and  12.35%,  respectively,  compared  to requirements of 1.5%, 3.0% and
8.0%,  respectively.

At March 31, 2001, the Bank had loan commitments of approximately $33.0 million.
In  addition,  at March 31, 2001, the unused portion of lines of credit extended
by  the Bank was approximately $9.7 million for consumer loans and $25.4 million
for  commercial  loans.  Standby  letters of credit and financial guarantees are
conditional  commitments  issued  by  the Bank to guarantee the performance of a
customer  to  a  third  party.  Those guarantees are primarily issued to support
public  and  private  borrowing  arrangements,  including commercial paper, bond
financing,  and  similar  transactions.  Most  guarantees extend from one to two
years.  The credit risk involved in issuing letters of credit is essentially the
same  as  that involved in extending loan facilities to customers.  At March 31,
2001,  the  Bank  had  $6.8  million  of  letters  of  credit  outstanding.

Impact  of  Inflation  and  Changing  Prices

The  consolidated  financial  statements  of  the  Company  and  notes  thereto,
presented  elsewhere  herein,  have been prepared in accordance with GAAP, which
require the measurement of financial condition and operating results in terms of
historical  dollars  without considering the change in relative purchasing power
of  money  over  time due to inflation.  The impact of inflation is reflected in
the  increased  cost  of  the  Company's  operations.  Unlike  most  industrial
companies,  nearly  all the assets and liabilities of the Company are financial.
As  a  result, interest rates have a greater impact on the Company's performance
than  do  the  effects  of  general  levels of inflation.  Interest rates do not
necessarily  move  in  the same direction or to the same extent as the prices of
goods  and  services.

Item  3.  Quantitative  and  Qualitative  Disclosures  About  Market  Risk

The  Company's  interest  rate  sensitivity  is  monitored by management through
selected  interest rate risk measures produced internally and by the OTS.  Based
on  internal reviews, management does not believe that there has been a material
change  in  the  Company's  interest rate sensitivity from December 31, 2000, to
March  31, 2001.  However, the OTS results are not yet available for the quarter
ended  March  31,  2001.  All  methods used to measure interest rate sensitivity
involve  the use of assumptions.  Management cannot predict what assumptions are
made  by  the OTS, which can vary from management's assumptions.  Therefore, the
results  of  the  OTS  calculations  can  differ  from  management's  internal
calculations.  The  Company's  interest  rate  sensitivity should be reviewed in
conjunction  with  the  financial  statements and notes thereto contained in the
Company's  Annual  Report  for  the  year  ended  December  31,  2000.

                                        9
<PAGE>

The  following  table  presents the Company's maturity gap at March 31, 2001 (In
thousands).

<TABLE>
<CAPTION>


                                             Six       After     After
                                 Within     Months     One to    Three       Over
                                  Six       To One     Three     to Five      Ten
                                 Months      Year      Years      Years       Years      Total
                                 ------     ------    ------      ------      ------    --------


<S>                            <C>        <C>        <C>       <C>         <C>         <C>
Interest-earning assets:

   Loans receivable, net. . .  $ 62,928   $ 46,332   $67,439   $  48,815   $  64,253   $289,767
   Mortgage-backed
     securities . . . . . . .        17         17        70          70         408        582
   FHLB Stock . . . . . . . .     2,056          -         -           -           -      2,056
   Investment securities. . .     9,083      9,050    22,495           -           -     40,628
   Federal funds sold
     overnight and other
     interest-bearing
     deposits . . . . . . . .    35,121          -         -           -           -     35,121
                               ---------  ---------  --------  ----------  ----------  ---------

     Total rate
        sensitive assets. . .  $109,205   $ 55,399   $90,004   $  48,885   $  64,661   $368,154
                               =========  =========  ========  ==========  ==========  =========

Interest-bearing
  liabilities:

Deposits:
   NOW accounts . . . . . . .  $  5,167   $  5,167   $20,669   $  20,669   $       -   $ 51,672
   Passbook savings
     accounts . . . . . . . .     1,420      1,420     5,681       5,681           -     14,202
   Money market
     deposit accounts . . . .     7,979      7,979    31,916      31,916           -     79,790
   Certificates of
     deposit. . . . . . . . .    92,683     47,895    23,354       3,346           -    167,278
Borrowings. . . . . . . . . .        27         27       109         109         767      1,039
                               ---------  ---------  --------  ----------  ----------  ---------
     Total rate
        sensitive liabilities  $107,276   $ 62,488   $81,729   $  61,721   $     767   $313,981
                               =========  =========  ========  ==========  ==========  =========

Excess (deficiency) of
    interest sensitive
    assets over interest
    sensitive liabilities . .  $  1,929    ($7,089)  $ 8,275    ($12,836)  $  63,894   $ 54,173
Cumulative excess
    (deficiency) of
    interest sensitive
    assets. . . . . . . . . .  $  1,929    ($5,160)  $ 3,115     ($9,721)  $  54,173   $ 54,173
Cumulative ratio of
    interest-earning
    assets to interest-
    bearing liabilities . . .    101.80%     96.96%   101.24%      96.90%     117.25%    117.25%
Interest sensitivity
   gap to total rate
   sensitive assets . . . . .      0.52%    (1.93)%     2.25%     (3.49)%      17.36%     14.71%
Ratio of interest-
   earning assets to
   interest -bearing
   liabilities. . . . . . . .    101.80%     88.66%   110.12%      79.20%   8,430.38%    117.25%
Ratio of cumulative gap
   to total rate
   sensitive assets . . . . .      0.52%    (1.40)%     0.85%     (2.64)%      14.71%     14.71%
</TABLE>


                                       10
<PAGE>

Part  II.  Other  Information

Item  1.  Legal  Proceedings

     Not  applicable

Item  2.  Changes  in  Securities  and  use  of  Proceeds

     Not  applicable

Item  3.  Defaults  Upon  Senior  Securities

     Not  applicable

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

     Not  applicable

Item  5.  Other  Information

     None

Item  6.  Exhibits,  Financial  Statement  Schedules,  and  Reports  on Form 8-K

     (a)  Exhibits

           3.1     Charter  of  the  Registrant*
           3.2     Bylaws  of  the  Registrant*
          10.1     Employment  Agreement  with  Ed  C.  Loughry,  Jr.**
          10.2     Employment  Agreement  with  Ronald  F.  Knight  **
          10.3     Severance  Agreement  with  Hillard  C.  Gardner**
          10.4     Severance  Agreement  with  Ira  B.  Lewis  ,  Jr.**
          10.5     Severance  Agreement  with  R.  Dale  Floyd  **
          10.6     Severance  Agreement  with  M.  Glenn  Layne  **
          10.7     Severance  Agreement  with  Joy  B.  Jobe**
          10.8     Severance  Agreement  with  William  S.  Jones**
          10.9     Severance  Agreement  with  David  W.  Hopper**
          10.10    Cavalry  Banking Key Personnel Severance Compensation Plan**
          10.11    Cavalry  Banking  Employee  Stock  Ownership  Plan**
          10.12    Management Recognition Plan with William H. Huddleston III***
          10.13    Management  Recognition  Plan  with  Gary  Brown  ***
          10.14    Management  Recognition  Plan  with  Ed  Elam  ***
          10.15    Management  Recognition Plan with Frank E. Crosslin, Jr. ***
          10.16    Management  Recognition  Plan  with  Tim  J.  Durham  ***
          10.17    Management  Recognition  Plan  with  James  C.  Cope  ***
          10.18    Management  Recognition  Plan  with  Terry  G.  Haynes  ***
          10.19    Management  Recognition  Plan  with  Ed  C. Loughry, Jr. ***
          10.20    Management  Recognition  Plan  with  Ronald  F.  Knight  ***
          10.21    Management  Recognition  Plan  with  William  S.  Jones  ***
          10.22    Management  Recognition  Plan  with  Hillard  C. Gardner ***
          10.23    Management  Recognition  Plan  with  R.  Dale  Floyd  ***
          10.24    Management  Recognition  Plan  with  David  W.  Hopper  ***
          10.25    Management  Recognition  Plan  with  Joe  W.  Townsend  ***
          10.26    Management  Recognition  Plan  with  M.  Glenn  Layne  ***
          10.27    Management  Recognition  Plan  with  Joy  B.  Jobe  ***
          10.28    Management  Recognition  Plan  with  Ira  B.  Lewis, Jr. ***
          10.29    Management  Recognition  Plan  with  Elizabeth  L. Green ***
          10.30    Management  Recognition  Plan with James O. Sweeney, III ***
          13       Annual  Report  to  Stockholders****
          21       Subsidiaries  of  the  Registrant****

*     Incorporated  herein  by  reference  to  the  Registrant's  Registration
      Statement  on  Form  S-1,  as  amended  (333-40057).
**    Incorporated  herein  by  reference  to the Registrant's Annual Report on
      Form 10-K for the year ended December 31, 1997, as filed with the
      Securities and Exchange  Commission  on  March  30,  1998.
***   Incorporated  herein  by  reference  to  the Registrant's Annual Meeting
      Proxy  Statement dated March 15, 1999, as filed with the Securities and
      Exchange Commission  on  March  15,  1999.
****  Incorporated  herein  by reference to the Registrant's Annual Report on
      Form 10-K for the year ended December 31, 2000, as filed with the
      Securities and Exchange  Commission  on  March  26,  2001.

     (b)  Reports  on  Form  8-K

     No  Reports on Form 8-K were filed during the quarter ended March 31, 2001.

                                       11
<PAGE>

Pursuant  to  the  requirements  of section 13 or 15(d) of the Securities Act of
1934,  the  registrant has duly caused this report to be signed on its behalf by
the  undersigned,  thereunto  duly  authorized.


                                        CAVALRY  BANCORP,  INC.

Date:  May  9,  2001                    by: /s/  Ed C. Loughry,Jr.
                                            -----------------------------
                                            Ed  C.  Loughry,  Jr.
                                            Chairman  of the Board of Directors
                                            Chief  Executive  Officer


Date:  May  9,  2001                    by:  /s/  Hillard  C. Gardner
                                             ----------------------------
                                             Hillard  C.  Gardner
                                             Senior  Vice  President and Chief
                                             Financial  Officer
                                             (Principal  Financial  and
                                             Accounting  Officer)

                                       12
<PAGE>