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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

(MARK ONE)

[X]      Annual Report under Section 13 or 15(d) of the Securities Exchange Act
         of 1934

                           For the fiscal year ended December 31, 1999

                                       OR

[ ]      Transition Report under Section 13 or 15(d) of the Securities Exchange
         Act of 1934

                           For the transition period from ________ to ________

                          Commission file no. 33-95562

                           RHBT FINANCIAL CORPORATION
                 ----------------------------------------------
                 (Name of Small Business Issuer in Its Charter)

                South Carolina                               58-2482426
       ---------------------------------                 -------------------
         (State or Other Jurisdiction                     (I.R.S. Employer
       of Incorporation or Organization)                 Identification No.)

             315 East Main Street
           Rock Hill, South Carolina                           29730
      ----------------------------------                     ----------
   (Address of Principal Executive Offices)                  (Zip Code)


                                 (843) 324-2500
                 Issuer's Telephone Number, Including Area Code

        Securities registered pursuant to Section 12(b) of the Act: None
    Securities registered pursuant to Section 12(g) of the Act: Common Stock

         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 past 90 days.
Yes [X]       No[ ]

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]

         The aggregate market value of the voting stock held by non-affiliates
of the registrant as of March 1, 2000 was $8,507,591. This calculation is based
upon $14.25, the last trade price of the common stock of which the Company is
aware. There is no active trading market for the common stock and trades are
limited and sporadic.

         There were 1,720,938 shares of the Company's common stock issued and
outstanding as of the record date, March 15, 2000.

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

                       DOCUMENTS INCORPORATED BY REFERENCE

               Company's 1999 Annual Report and Proxy Statement for the 2000
Annual Meeting of Shareholders.

================================================================================

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ITEM 1.    DESCRIPTION OF BUSINESS

         This Report contains statements which constitute forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933 and
the Securities Exchange Act of 1934. These statements are based on many
assumptions and estimates and are not guarantees of future performance. Our
actual results may differ materially from those projected in any forward-looking
statements, as they will depend on many factors about which we are unsure,
including many factors which are beyond our control. The words "may," "would,"
"could," "will," "expect," "anticipate," "believe," "intend," "plan," and
"estimate," as well as similar expressions, are meant to identify such
forward-looking statements. Potential risks and uncertainties include, but are
not limited to:

-        significant increases in competitive pressure in the banking and
         financial services industries;

-        changes in the interest rate environment which could reduce anticipated
         or actual margins;

-        changes in political conditions or the legislative or regulatory
         environment;

-        general economic conditions, either nationally or regionally and
         especially in primary service area, becoming less favorable than
         expected resulting in, among other things, a deterioration in credit
         quality;

-        changes occurring in business conditions and inflation;

-        changes in technology;

-        changes in monetary and tax policies;

-        changes in the securities markets; and

-        other risks and uncertainties detailed from time to time in our filings
         with the Securities and Exchange Commission.


GENERAL

         RHBT Financial Corporation was organized in 1999 to serve as a bank
holding company for Rock Hill Bank & Trust. The bank commenced business on May
20, 1996 as a South Carolina state-chartered bank headquartered in Rock Hill,
South Carolina. The principal business activity of the company is to provide
banking services to domestic markets, principally in York County, South
Carolina. In addition to providing traditional banking services, the company has
a trust department that offers a full range of trust services and a mortgage
loan division. The mortgage loan division originates loans to purchase existing
or construct new homes and to refinance existing mortgages. The company opened
two additional branches in 1999. The Ebenezer office opened in January 1999, and
the Fort Mill/Tega Cay office opened in September 1999.

         On July 16, 1999, our board of directors declared a five-for-four stock
split effected in the form of a 25% stock dividend payable on September 10, 1999
to stockholders of record on August 1, 1999. This resulted in the issuance of
344,063 shares of common stock. On November 8, 1999, our common stock began
trading on The Nasdaq Stock Market under its previous symbol "RHBT."

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         Our stockholders voted on April 16, 1998, to amend the Articles of
Incorporation to eliminate the two classes of common stock known as Class A and
Class B. A new class of common stock known simply as common stock was created,
and the number of authorized shares was increased to 10,000,000. Prior to this
vote, Bailey Financial Corporation owned all of the Class B shares, or 51% of
the total outstanding common stock. On June 19, 1998, the change in classes of
stock became effective. Bailey exchanged its Class B shares for common shares
and terminated its right of first refusal agreements and its right to elect
separate directors.

         Our significant growth during the first two years of operations led to
the need for additional capital. On July 28, 1998, we sold, through an
underwritten public offering, 675,000 shares of common stock at a public
offering price of $13.25 per share. On August 3, 1998, we sold an additional
101,250 common shares, also at a public offering price of $13.25 per share,
pursuant to an underwriters over-allotment provision.

         Our primary source of revenue is interest income and fees, which we
earn by lending and investing our capital and the funds which are held on
deposit. Because loans generally earn higher rates of interest than investments,
the bank seeks to employ as many of its deposit funds as possible in the form of
loans to individuals and businesses. To ensure sufficient liquidity, we also
maintain a portion of the bank's deposits in cash, government securities,
deposits with other financial institutions, and overnight loans of excess
reserves (known as "federal funds sold") to correspondent banks. The revenue
which the bank earns (prior to deducting its overhead expenses) is essentially a
function of the amount of the bank's loans and deposits, as well as the profit
margin ("interest spread") and fee income. Our bank also is the only locally
owned community bank in the Rock Hill area that provides trust services and has
a mortgage loan division.

MARKETING FOCUS

         Our bank primarily serves the city of Rock Hill and the surrounding
area of York County, South Carolina. The bank's extended market area also
includes the south side of Charlotte in Mecklenburg County, North Carolina, and
Lancaster and Chester Counties in South Carolina. Rock Hill is the fifth largest
city in South Carolina and is located in the eastern central area of York
County, South Carolina, approximately 25 miles southwest of Charlotte, North
Carolina and on the outskirts of the Charlotte/Mecklenburg metropolitan area.
Rock Hill is approximately 70 miles north of Columbia, South Carolina, and 95
miles northeast of Greenville, South Carolina. The area has experienced steady
growth over the past ten years and the bank expects the area, as well as the
service industries needed to support it, to continue to grow. According to the
U.S. Census Bureau, York County is one of the fastest growing counties in South
Carolina, with a population of 150,000 in 1997, reflecting a 14.5% increase
since 1990. York County also boasts one of the highest per capita incomes in
South Carolina, with a median household income in 1997 of $47,300, compared to
$29,000 for South Carolina as a whole.

BANKING SERVICES

         The bank strives to provide its customers with the breadth of products
and services comparable to those offered by large regional banks, while
maintaining the quick response and personal service of a locally owned and
managed bank. In addition to offering a full range of deposit services and
commercial and personal loans, our bank offers trust services and products such
as mortgage loan originations and accounts receivable financing.


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-        Deposit Services. The bank offers a full range of deposit services that
         are typically available in most banks and savings and loan
         associations, including checking accounts, NOW accounts, savings
         accounts, and other time deposits of various types, ranging from daily
         money market accounts to longer-term certificates of deposit. The
         transaction accounts and time certificates are tailored to our
         principal market area at rates competitive to those offered by other
         banks in the area. In addition, we offer certain retirement account
         services, such as Individual Retirement Accounts (IRAs). All deposit
         accounts are insured by the Federal Deposit Insurance Corporation (the
         "FDIC") up to the maximum amount allowed by law. The bank solicits
         these accounts from individuals, businesses, associations and
         organizations, and governmental authorities.

-        Loan Products. The bank offers a full range of commercial and personal
         loans. Commercial loans include both secured and unsecured loans for
         working capital (including loans secured by inventory and accounts
         receivable), business expansion (including acquisition of real estate
         and improvements), and purchase of equipment and machinery. Consumer
         loans include equity lines of credit and secured and unsecured loans
         for financing automobiles, home improvements, education, and personal
         investments. The bank also makes real estate construction and
         acquisition loans. The bank's lending activities are subject to a
         variety of lending limits imposed by federal law. While differing
         limits apply in certain circumstances based on the type of loan or the
         nature of the borrower (including the borrower's relationship to us),
         in general we are subject to a loans-to-one-borrower limit of an amount
         equal to 15% of the bank's unimpaired capital and surplus. We may not
         make any loans to any director, officer, employee, or 10% shareholder
         of the bank unless the loan is approved by our board of directors and
         is made on terms not more favorable to such a person than would be
         available to a person not affiliated with us.

-        Mortgage Loan Division. The bank recently established a mortgage loan
         division through which it has broadened the range of services that it
         offers to its customers, and we are now the only locally-owned bank in
         Rock Hill with a separate mortgage division. The mortgage loan division
         originates loans to purchase existing or construct new homes and to
         refinance existing mortgages. The bank anticipates generating
         additional fee income by selling most of these loans in the secondary
         market and cross-selling its other products and services to its
         mortgage customers.

-        Trust Services. The bank is the only locally managed bank in the Rock
         Hill area that has a trust department, through which we offer a full
         range of trust services, including personal trusts, testamentary
         trusts, investment management, custodian services, income tax
         assistance and counseling, and retirement and estate planning.

-        Accounts Receivable Financing. The bank provides accounts receivable
         financing to businesses through an agreement with an outside vendor,
         using software licensed from the vendor to handle the billing and
         collection of these receivables. Because accounts receivable-based
         loans typically carry a higher rate of risk than many other types of
         loans, the bank also has default and fraud insurance and customarily
         obtains a personal guarantee from the small business owner.

-        Other Services. Other bank services include cash management services,
         safe deposit boxes, travelers checks, direct deposit of payroll and
         social security checks, and automatic drafts for various accounts. The
         bank is associated with Honor and Plus networks of automated teller
         machines that may be used by our customers throughout South Carolina
         and other regions. The bank also offers VISA credit card services
         through a correspondent bank as an agent for us.


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COMPETITION

         Banks generally compete with other financial institutions through the
selection of banking products and services offered, the pricing of services, the
level of service provided, the convenience and availability of services, and the
degree of expertise and the personal manner in which services are offered. South
Carolina law permits statewide branching by banks and savings institutions, and
many financial institutions in the state have branch networks. Consequently,
commercial banking in South Carolina is highly competitive. As of December 31,
1999, there were approximately eight commercial banks, no savings and loan
institutions, and four credit unions in the same area as Rock Hill Bank & Trust.
Many large banking organizations currently operate in the Bank's market area,
several of which are controlled by out-of-state ownership. In addition,
competition between commercial banks and thrift institutions (savings
institutions and credit unions) has been intensified significantly by the
elimination of many previous distinctions between the various types of financial
institutions and the expanded powers and increased activity of thrift
institutions in areas of banking which previously had been the sole domain of
commercial banks. Recent legislation, together with other regulatory changes by
the primary regulators of the various financial institutions, has resulted in
almost total elimination of practical distinctions between a commercial bank and
a thrift institution. Consequently, competition among financial institutions of
all types is largely unlimited with respect to legal authority to provide most
financial services.

         Competition among financial institutions in the Rock Hill area is
particularly intense because of the strong credit union base resulting from the
large number of textile and other industrial companies in the area; Rock Hill's
proximity to Charlotte, North Carolina, which is home to large regional and
national banks such as Bank of America (formerly known as NationsBank), First
Union, and Wachovia; and the establishment of two other new community banks in
Rock Hill in the last several years.

                           SUPERVISION AND REGULATION

         Both the company and the bank are subject to extensive state and
federal banking laws and regulations which impose specific requirements or
restrictions on and provide for general regulatory oversight of virtually all
aspects of operations. These laws and regulations are generally intended to
protect depositors, not shareholders. The following summary is qualified by
reference to the statutory and regulatory provisions discussed. Changes in
applicable laws or regulations may have a material effect on our business and
prospects. Beginning with the enactment of the Financial Institution Report
Recovery and Enforcement Act in 1989 and following with the FDIC Improvement Act
in 1991, numerous additional regulatory requirements have been placed on the
banking industry in the past several years, and additional changes have been
proposed. Our operations may be affected by legislative changes and the policies
of various regulatory authorities. We cannot predict the effect that fiscal or
monetary policies, economic control, or new federal or state legislation may
have on our business and earnings in the future.

GRAMM-LEACH-BLILEY ACT

         On November 4, 1999, the U.S. Senate and House of Representatives each
passed the Gramm-Leach-Bliley Act, previously known as the Financial Services
Modernization Act of 1999. The Act was signed into law by President Clinton on
November 12, 1999. Among other things, the Act repeals the restrictions on banks
affiliating with securities firms contained in sections 20 and 32 of the
Glass-Steagall Act. The Act also permits bank holding companies to engage in a
statutorily provided list of


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financial activities, including insurance and securities underwriting and agency
activities, merchant banking, and insurance company portfolio investment
activities. The Act also authorizes activities that are "complementary" to
financial activities.

         The Act is intended to grant to community banks certain powers as a
matter of right that larger institutions have accumulated on an ad hoc basis.
Nevertheless, the Act may have the result of increasing the amount of
competition that we face from larger institutions and other types of companies.
In fact, it is not possible to predict the full effect that the Act will have on
us. From time to time other changes are proposed to laws affecting the Banking
industry, and these changes could have a material effect on our business and
prospects. We cannot predict the nature or the extent of the effect on our
business and earnings of fiscal or monetary policies, economic controls, or new
federal or state legislation.

RHBT FINANCIAL CORPORATION

         Because it owns the outstanding capital stock of the bank, the company
is a bank holding company under the federal Bank Holding Company Act of 1956 and
the South Carolina Banking and Branching Efficiency Act.

         The Bank Holding Company Act. Under the Bank Holding Company Act, the
company is subject to periodic examination by the Federal Reserve and required
to file periodic reports of its operations and any additional information that
the Federal Reserve may require. Our activities at the bank and holding company
level are limited to:

         -        banking and managing or controlling banks;

         -        furnishing services to or performing services for its
                  subsidiaries; and

         -        engaging in other activities that the Federal Reserve
                  determines to be so closely related to banking and managing or
                  controlling banks as to be a proper incident thereto.

         Investments, Control, and Activities. With certain limited exceptions,
the Bank Holding Company Act requires every bank holding company to obtain the
prior approval of the Federal Reserve before:

         -        acquiring substantially all the assets of any bank;

         -        acquiring direct or indirect ownership or control of any
                  voting shares of any bank if after the acquisition it would
                  own or control more than 5% of the voting shares of such bank
                  (unless it already owns or controls the majority of such
                  shares); or

         -        merging or consolidating with another bank holding company.

         In addition, and subject to certain exceptions, the Bank Holding
Company Act and the Change in Bank Control Act, together with regulations
thereunder, require Federal Reserve approval prior to any person or company
acquiring "control" of a bank holding company. Control is conclusively presumed
to exist if an individual or company acquires 25% or more of any class of voting
securities of a bank holding company. Control is rebuttably presumed to exist if
a person acquires 10% or more, but less than 25%, of any class of voting
securities and either the company has registered securities under Section 12 of
the Securities Exchange Act of 1934 or no other person owns a greater percentage
of that class of voting securities immediately after the transaction. The
company's common stock is


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registered under the Securities Exchange Act of 1934. The regulations provide a
procedure for challenge of the rebuttable control presumption.

         Under the Bank Holding Company Act, a bank holding company is generally
prohibited from engaging in, or acquiring direct or indirect control of more
than 5% of the voting shares of any company engaged in nonbanking activities
unless the Federal Reserve Board, by order or regulation, has found those
activities to be so closely related to banking or managing or controlling banks
as to be a proper incident thereto. Some of the activities that the Federal
Reserve Board has determined by regulation to be proper incidents to the
business of a bank holding company include:

         -        making or servicing loans and certain types of leases;

         -        engaging in certain insurance and discount brokerage
                  activities;

         -        performing certain data processing services;

         -        acting in certain circumstances as a fiduciary or investment
                  or financial adviser;

         -        owning savings associations; and

         -        making investments in certain corporations or projects
                  designed primarily to promote community welfare.

         The Federal Reserve Board imposes certain capital requirements on the
company under the Bank Holding Company Act, including a minimum leverage ratio
and a minimum ratio of "qualifying" capital to risk-weighted assets. These
requirements are described below under "Capital Regulations." Subject to its
capital requirements and certain other restrictions, the company is able to
borrow money to make a capital contribution to the bank, and these loans may be
repaid from dividends paid from the bank to the company. Our ability to pay
dividends is subject to regulatory restrictions as described below in "Rock Hill
Bank & Trust - Dividends." The company is also able to raise capital for
contribution to the bank by issuing securities without having to receive
regulatory approval, subject to compliance with federal and state securities
laws.

         Source of Strength; Cross-Guarantee. In accordance with Federal Reserve
Board policy, the company is expected to act as a source of financial strength
to the bank and to commit resources to support the bank in circumstances in
which the company might not otherwise do so. Under the Bank Holding Company Act,
the Federal Reserve Board may require a bank holding company to terminate any
activity or relinquish control of a nonbank subsidiary, other than a nonbank
subsidiary of a bank, upon the Federal Reserve Board's determination that such
activity or control constitutes a serious risk to the financial soundness or
stability of any subsidiary depository institution of the bank's holding
company. Further, federal bank regulatory authorities have additional discretion
to require a bank holding company to divest itself of any bank or nonbank
subsidiary if the agency determines that divestiture may aid the depository
institution's financial condition.

         South Carolina State Regulation. As a bank holding company registered
under the South Carolina Banking and Branching Efficiency Act, we are subject to
limitations on sale or merger and to regulation by the South Carolina Board of
Financial Institutions. We must receive the Board's approval prior to engaging
in the acquisition of banking or nonbanking institutions or assets, and we must
file periodic reports with respect to our financial condition and operations,
management, and intercompany relationships between the company and its
subsidiaries.


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ROCK HILL BANK & TRUST

         The bank operates as a South Carolina state bank and is subject to
examination by the South Carolina Board of Financial Institutions. Deposits in
the bank are insured by the FDIC up to a maximum amount, which is generally
$100,000 per depositor subject to aggregation rules.

         The South Carolina Board of Financial Institutions and the FDIC
regulate or monitor virtually all areas of the bank's operations, including:

-        security devices and procedures;

-        adequacy of capitalization and loss reserves;

-        loans;

-        investments;

-        borrowings;

-        deposits;

-        mergers;

-        issuances of securities;

-        payment of dividends;

-        interest rates payable on deposits;

-        interest rates or fees chargeable on loans;

-        establishment of branches;

-        corporate reorganizations;

-        maintenance of books and records; and

-        adequacy of staff training to carry on safe lending and deposit
         gathering practices.

         The South Carolina Board of Financial Institutions requires the bank to
maintain specified capital ratios and imposes limitations on the bank's
aggregate investment in real estate, bank premises, and furniture and fixtures.
The FDIC requires the bank to prepare quarterly reports on the bank's financial
condition and to conduct an annual audit of its financial affairs in compliance
with its minimum standards and procedures.

         Under the FDIC Improvement Act, all insured institutions must undergo
regular on site examinations by their appropriate banking agency. The cost of
examinations of insured depository institutions and any affiliates may be
assessed by the appropriate agency against each institution or affiliate as it
deems necessary or appropriate. Insured institutions are required to submit
annual reports to the FDIC, their federal regulatory agency, and their state
supervisor when applicable. The FDIC Improvement Act directs the FDIC to develop
a method for insured depository institutions to provide supplemental disclosure
of the estimated fair market value of assets and liabilities, to the extent
feasible and practicable, in any balance sheet, financial statement, report of
condition or any other report of any insured depository institution. The FDIC
Improvement Act also requires the federal banking regulatory agencies to
prescribe, by regulation, standards for all insured depository institutions and
depository institution holding companies relating, among other things, to the
following:

-         internal controls;

-         information systems and audit systems;

-         loan documentation;

-         credit underwriting;


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-         interest rate risk exposure; and

-         asset quality.

         Deposit Insurance. The FDIC establishes rates for the payment of
premiums by federally insured banks and thrifts for deposit insurance. A
separate Bank Insurance Fund and Savings Association Insurance Fund are
maintained for commercial banks and savings associations with insurance premiums
from the industry used to offset losses from insurance payouts when banks and
thrifts fail. In 1993, the FDIC adopted a rule which establishes a risk-based
deposit insurance premium system for all insured depository institutions. Under
this system, until mid-1995 depository institutions paid to Bank Insurance Fund
or Savings Association Insurance Fund from $0.23 to $0.31 per $100 of insured
deposits depending on its capital levels and risk profile, as determined by its
primary federal regulator on a semiannual basis. Once the Bank Insurance Fund
reached its legally mandated reserve ratio in mid-1995, the FDIC lowered
premiums for well-capitalized banks, eventually eliminating premiums for
well-capitalized banks, with a minimum semiannual assessment of $1,000. However,
in 1996 Congress enacted the Deposit Insurance Funds Act of 1996, which
eliminated even this minimum assessment. It also separated the Financial
Corporation assessment to service the interest on its bond obligations. The
amount assessed on individual institutions by the Financial Corporation
assessment is in addition to the amount paid for deposit insurance according to
the risk-related assessment rate schedule. Increases in deposit insurance
premiums or changes in risk classification will increase the bank's cost of
funds, and we may not be able to pass these costs on to our customers.

         Transactions With Affiliates and Insiders. The bank is subject to the
provisions of Section 23A of the Federal Reserve Act, which places limits on the
amount of loans or extensions of credit to, or investments in, or certain other
transactions with, affiliates and on the amount of advances to third parties
collateralized by the securities or obligations of affiliates. The aggregate of
all covered transactions is limited in amount, as to any one affiliate, to 10%
of the bank's capital and surplus and, as to all affiliates combined, to 20% of
the bank 's capital and surplus. Furthermore, within the foregoing limitations
as to amount, each covered transaction must meet specified collateral
requirements. Compliance is also required with certain provisions designed to
avoid the taking of low quality assets.

         The bank is also subject to the provisions of Section 23B of the
Federal Reserve Act which, among other things, prohibits an institution from
engaging in certain transactions with certain affiliates unless the transactions
are on terms substantially the same, or at least as favorable to such
institution or its subsidiaries, as those prevailing at the time for comparable
transactions with nonaffiliated companies. The bank is subject to certain
restrictions on extensions of credit to executive officers, directors, certain
principal shareholders, and their related interests. Such extensions of credit
(i) must be made on substantially the same terms, including interest rates and
collateral, as those prevailing at the time for comparable transactions with
third parties and (ii) must not involve more than the normal risk of repayment
or present other unfavorable features.

         Dividends. The bank is subject to regulatory restrictions on the
payment of dividends, including a prohibition of payment of dividends from its
capital. All dividends must be paid out of the undivided profits then on hand,
after deducting expenses, including losses and bad debts. The bank must also
obtain approval from the South Carolina Board of Financial Institutions prior to
the payment of any dividends. In addition, under the FDIC Improvement Act, the
bank may not pay a dividend if, after paying the dividend, the bank would be
undercapitalized. See "Capital Regulations" below.


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         Branching. Under current South Carolina law, we may open bank branch
offices throughout South Carolina with the prior approval of the South Carolina
Board of Financial Institutions. In addition, with prior regulatory approval,
the bank may acquire existing banking operations in South Carolina. Furthermore,
federal legislation has recently been passed which permits interstate branching.
The new law permits out-of-state acquisitions by bank holding companies,
interstate branching by banks if allowed by state law, interstate merging by
banks, and de novo branching by banks if allowed by state law. North Carolina
has passed legislation that, in effect, prohibits de novo branching by South
Carolina banks into North Carolina.

         Community Reinvestment Act. The Community Reinvestment Act requires
that, in connection with examinations of financial institutions within their
respective jurisdictions, a financial institution's primary federal regulator
(this is the FDIC for our bank) shall evaluate the record of each financial
institution in meeting the credit needs of its local community, including low
and moderate income neighborhoods. These factors are also considered in
evaluating mergers, acquisitions, and applications to open a branch or facility.
Failure to adequately meet these criteria could impose additional requirements
and limitations on the bank.

         Other Regulations. Interest and other charges collected or contracted
for by the bank are subject to state usury laws and federal laws concerning
interest rates. The bank's loan operations are also subject to federal laws
applicable to credit transactions, such as:

         -        the federal Truth-In-Lending Act, governing disclosures of
                  credit terms to consumer borrowers;

         -        the Home Mortgage Disclosure Act of 1975, requiring financial
                  institutions to provide information to enable the public and
                  public officials to determine whether a financial institution
                  is fulfilling its obligation to help meet the housing needs of
                  the community it serves;

         -        the Equal Credit Opportunity Act, prohibiting discrimination
                  on the basis of race, creed or other prohibited factors in
                  extending credit;

         -        the Fair Credit Reporting Act of 1978, governing the use and
                  provision of information to credit reporting agencies;

         -        the Fair Debt Collection Act, governing the manner in which
                  consumer debts may be collected by collection agencies; and

         -        the rules and regulations of the various federal agencies
                  charged with the responsibility of implementing such federal
                  laws.

The deposit operations of the bank also are subject to:

         -        the Right to Financial Privacy Act, which imposes a duty to
                  maintain confidentiality of consumer financial records and
                  prescribes procedures for complying with administrative
                  subpoenas of financial records; and

         -        the Electronic Funds Transfer Act and Regulation E issued by
                  the Federal Reserve Board to implement that act, which governs
                  automatic deposits to and withdrawals from deposit accounts
                  and customers' rights and liabilities arising from the use of
                  automated teller machines and other electronic banking
                  services.

         Capital Regulations. The federal bank regulatory authorities have
adopted risk-based capital guidelines for banks and bank holding companies that
are designed to make regulatory capital


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requirements more sensitive to differences in risk profiles among banks and bank
holding companies and account for off-balance sheet items. The guidelines are
minimums, and the federal regulators have noted that banks and bank holding
companies contemplating significant expansion programs should not allow
expansion to diminish their capital ratios and should maintain ratios in excess
of the minimums. We have not received any notice indicating that either the
company or the bank is subject to higher capital requirements. The current
guidelines require all bank holding companies and federally-regulated banks to
maintain a minimum risk-based total capital ratio equal to 8%, of which at least
4% must be Tier 1 capital. Tier 1 capital includes common shareholders' equity,
qualifying perpetual preferred stock, and minority interests in equity accounts
of consolidated subsidiaries, but excludes goodwill and most other intangibles
and excludes the allowance for loan and lease losses. Tier 2 capital includes
the excess of any preferred stock not included in Tier 1 capital, mandatory
convertible securities, hybrid capital instruments, subordinated debt and
intermediate term-preferred stock, and general reserves for loan and lease
losses up to 1.25% of risk-weighted assets.

         Under these guidelines, banks' and bank holding companies' assets are
given risk-weights of 0%, 20%, 50%, or 100%. In addition, certain off-balance
sheet items are given credit conversion factors to convert them to asset
equivalent amounts to which an appropriate risk-weight applies. These
computations result in the total risk-weighted assets. Most loans are assigned
to the 100% risk category, except for first mortgage loans fully secured by
residential property and, under certain circumstances, residential construction
loans, both of which carry a 50% rating. Most investment securities are assigned
to the 20% category, except for municipal or state revenue bonds, which have a
50% rating, and direct obligations of or obligations guaranteed by the United
States Treasury or United States Government agencies, which have a 0% rating.

         The federal bank regulatory authorities have also implemented a
leverage ratio, which is equal to Tier 1 capital as a percentage of average
total assets less intangibles, to be used as a supplement to the risk-based
guidelines. The principal objective of the leverage ratio is to place a
constraint on the maximum degree to which a bank holding company may leverage
its equity capital base. The minimum required leverage ratio for top-rated
institutions is 3%, but most institutions are required to maintain an additional
cushion of at least 100 to 200 basis points.

         The FDIC Improvement Act established a new capital-based regulatory
scheme designed to promote early intervention for troubled banks which requires
the FDIC to choose the least expensive resolution of bank failures. The new
capital-based regulatory framework contains five categories of compliance with
regulatory capital requirements, including "well capitalized," "adequately
capitalized," "undercapitalized," "significantly undercapitalized," and
"critically undercapitalized." To qualify as a "well capitalized" institution, a
bank must have a leverage ratio of no less than 5%, a Tier 1 risk-based ratio of
no less than 6%, and a total risk-based capital ratio of no less than 10%, and
the bank must not be under any order or directive from the appropriate
regulatory agency to meet and maintain a specific capital level. Currently, we
qualify as "well capitalized."

         Under the FDIC Improvement Act regulations, the applicable agency can
treat an institution as if it were in the next lower category if the agency
determines (after notice and an opportunity for hearing) that the institution is
in an unsafe or unsound condition or is engaging in an unsafe or unsound
practice. The degree of regulatory scrutiny of a financial institution
increases, and the permissible activities of the institution decreases, as it
moves downward through the capital categories. Institutions that fall into one
of the three undercapitalized categories may be required to do some or all of
the following:


                                       10
<PAGE>   12

         -        submit a capital restoration plan;

         -        raise additional capital;

         -        restrict their growth, deposit interest rates, and other
                  activities;

         -        improve their management;

         -        eliminate management fees; or

         -        divest themselves of all or a part of their operations.

Bank holding companies controlling financial institutions can be called upon to
boost the institutions' capital and to partially guarantee the institutions'
performance under their capital restoration plans.

         These capital guidelines can affect us in several ways. If we grow at a
rapid pace, our capital may be depleted too quickly, and a capital infusion from
the holding company may be necessary which could impact our ability to pay
dividends. Our capital levels currently are adequate; however, rapid growth,
poor loan portfolio performance, poor earnings performance, or a combination of
these factors could change our capital position in a relatively short period of
time.

         Failure to meet these capital requirements would mean that a bank would
be required to develop and file a plan with its primary federal banking
regulator describing the means and a schedule for achieving the minimum capital
requirements. In addition, such a bank would generally not receive regulatory
approval of any application that requires the consideration of capital adequacy,
such as a branch or merger application, unless the bank could demonstrate a
reasonable plan to meet the capital requirement within a reasonable period of
time.

         Enforcement Powers. The Financial Institution Report Recovery and
Enforcement Act expanded and increased civil and criminal penalties available
for use by the federal regulatory agencies against depository institutions and
certain "institution-affiliated parties." Institution-affiliated parties
primarily include management, employees, and agents of a financial institution,
as well as independent contractors and consultants such as attorneys and
accountants and others who participate in the conduct of the financial
institution's affairs. These practices can include the failure of an institution
to timely file required reports or the filing of false or misleading information
or the submission of inaccurate reports. Civil penalties may be as high as
$1,000,000 a day for such violations. Criminal penalties for some financial
institution crimes have been increased to 20 years. In addition, regulators are
provided with greater flexibility to commence enforcement actions against
institutions and institution-affiliated parties. Possible enforcement actions
include the termination of deposit insurance. Furthermore, banking agencies'
power to issue cease-and-desist orders were expanded. Such orders may, among
other things, require affirmative action to correct any harm resulting from a
violation or practice, including restitution, reimbursement, indemnification or
guarantees against loss. A financial institution may also be ordered to restrict
its growth, dispose of certain assets, rescind agreements or contracts, or take
other actions as determined by the ordering agency to be appropriate.

         Effect of Governmental Monetary Policies. Our earnings are affected by
domestic economic conditions and the monetary and fiscal policies of the United
States government and its agencies. The Federal Reserve Bank's monetary policies
have had, and are likely to continue to have, an important impact on the
operating results of commercial banks through its power to implement national
monetary policy in order, among other things, to curb inflation or combat a
recession. The monetary policies of the Federal Reserve Board have major effects
upon the levels of bank loans, investments and deposits through its open market
operations in United States government securities and through its regulation of


                                       11
<PAGE>   13

the discount rate on borrowings of member banks and the reserve requirements
against member bank deposits. It is not possible to predict the nature or impact
of future changes in monetary and fiscal policies.


EMPLOYEES

         As of March 1, 2000, we had 36 full-time employees and two part-time
employees.


ITEM 2.    DESCRIPTION OF PROPERTY

         The Bank's main office is located in an 11,000 square foot facility
at 315 East Main Street in the city of Rock Hill, South Carolina. On January
7, 1999, the Bank opened its second office at 1746 Ebenezer Road in Rock Hill
near the intersection of Ebenezer and Herlong roads. This office is located
in a 2,700 square foot facility and is located approximately 2.9 miles north
west of the Main Office. The Bank opened a third office in September 1999 in
the Fort Mill/ Tega Cay area on Highway 160. The address is 100 Stone Village
Drive, Fort Mill, South Carolina. The Bank occupies approximately 4,000
square feet on the first floor of the two-story facility. Rock Hill Bank &
Trust maintains drive-up automated teller machines at each office.


ITEM 3.    LEGAL PROCEEDINGS.

         None.


ITEM 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

         No matter was submitted to a vote of security holders during the fourth
quarter of the fiscal year covered by this report.


ITEM 5.    MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

         In response to this Item, the information contained on page 41 of the
company's Annual Report to Shareholders for the year ended December 31, 1999 is
incorporated herein by reference.


ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         In response to this Item, the information contained on pages 3 through
18 of the company's Annual Report to Shareholders for the year ended December
31, 1999 is incorporated herein by reference.


                                       12
<PAGE>   14

ITEM 7.  FINANCIAL STATEMENTS

         In response to this Item, the information contained on pages 19 through
40 of the company's Annual Report to Shareholders for the year ended December
31, 1999 is incorporated herein by reference.


ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

         None.


ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(A) OF THE EXCHANGE ACT

         In response to this Item, the information contained on page 8 of the
company's Proxy Statement for the Annual Meeting of Shareholders to be held on
April 27, 2000 is incorporated herein by reference.


ITEM 10.  EXECUTIVE COMPENSATION

         In response to this Item, the information contained on pages 4 through
6 of the Company's Proxy Statement for the Annual Meeting of Shareholders to be
held on April 27, 2000 is incorporated herein by reference.


ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         In response to this Item, the information contained on pages 6 through
7 of the Company's Proxy Statement for the Annual Meeting of Shareholders to be
held on April 27, 2000 is incorporated herein by reference.


ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         In response to this Item, the information contained on page 8 of the
Company's Proxy Statement for the Annual Meeting of Shareholders to be held on
April 27, 2000 is incorporated herein by reference.


ITEM 13.   EXHIBITS, LIST AND REPORTS ON FORM 8-K

(a)      The following documents are filed as part of this report:

         3(a)     Articles of Incorporation (incorporated by reference to the
                  Bank's Registration Statement on Form 10-SB filed July 30,
                  1998).

         3(b)     Bylaws (incorporated by reference to the Bank's Registration
                  Statement on Form 10-SB filed July 30, 1998).


                                       13
<PAGE>   15

         4        Form of Certificate of Common Stock (incorporated by reference
                  to the Bank's Registration Statement on Form 10-SB filed July
                  30, 1998).

         5.1      Opinion Regarding Legality (incorporated by reference to the
                  Bank's Registration Statement on Form 10-SB filed July 30,
                  1998).

         10.1     Right of First Refusal Agreement dated May 16, 1998 with
                  Bailey Financial Corporation and the Bank. (incorporated by
                  reference to the Bank's Registration Statement on Form 10-SB
                  filed July 30, 1998).

         10.2     Share Exchange Agreement dated April 6, 1998 with Bailey
                  Financial Corporation and the Bank. (incorporated by reference
                  to the Bank's Registration Statement on Form 10-SB filed July
                  30, 1998).

         13.1.    Annual Report of Shareholders for the year ended December 31,
                  1999

         21.1     Subsidiaries of the Company

         27.1.    Financial Data Schedule. (for SEC use only).

------------------
*        Denotes executive compensation contract or arrangement.

(b)      Reports on Form 8-K

         No reports were filed on Form 8-K during the fourth quarter of 1999.


                                       14
<PAGE>   16


                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Securities Exchange Act
of 1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                       ROCK HILL BANK & TRUST

Date:   March 24, 2000                 By: /s/ J. A. Ferguson, Jr.
       ----------------------             ------------------------------
                                          J. A. Ferguson, Jr.
                                          President and Chief Executive Officer

         KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints J. A. Ferguson, Jr., his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign any
and all amendments to this Annual Report on Form 10-KSB, and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto attorney-in-fact and agent
full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that attorney-in-fact and agent, or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

         In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant in the capacities and on
the dates indicated.

<TABLE>
<CAPTION>

Signature                                    Title                               Date
                                             -----                               ----

<S>                                          <C>                                 <C>
/s/ Edwin L. Barnes
--------------------------------
Edwin L. Barnes                              Director                            03/24/00


/s/ William C. Beaty, Jr.
--------------------------------
William C. Beaty, Jr.                        Director                            03/24/00


/s/ Claude W. Burns, III
--------------------------------
Claude W. Burns, III                         Director                            03/24/00


/s/ J. A. Ferguson, Jr.
--------------------------------
J. A. Ferguson, Jr.                          President;                          03/24/00
                                             Chief Executive
                                             Officer and
                                             Director


/s/ Jean M. Gaillard
--------------------------------
Jean M. Gaillard                             Director                            03/24/00
</TABLE>


                                       15
<PAGE>   17

<TABLE>
<S>                                          <C>                                 <C>
/s/ Hugh L. Harrelson, Sr.
--------------------------------
Hugh L. Harrelson, Sr.                       Director                            03/24/00


/s/ Jerry H. Padgett
--------------------------------
Jerry H. Padgett                             Director                            03/24/00


/s/ Richard S. Powell
--------------------------------
Richard S. Powell                            Director                            03/24/00


/s/ Elvin F. Walker
--------------------------------
Elvin F. Walker                              Director                            03/24/00


/s/ Patricia M. Stone                        Chief Financial Officer             03/24/00
--------------------------------
Patricia M. Stone
</TABLE>


                                       16
<PAGE>   18

                                INDEX TO EXHIBITS

(a)      The following documents are filed as part of this report:

                  3(a)     Articles of Incorporation (incorporated by reference
                           to the Bank's Registration Statement on Form 10-SB
                           filed July 30, 1998).

                  3(b)     Bylaws (incorporated by reference to the Bank's
                           Registration Statement on Form 10-SB filed July 30,
                           1998)

                  4        Form of Certificate of Common Stock (incorporated by
                           reference to the Bank's Registration Statement on
                           Form 10-SB filed July 30, 1998).

                  5.1      Opinion Regarding Legality (incorporated by reference
                           to the Bank's Registration Statement on Form 10-SB
                           filed July 30, 1998).

                  10.1     Right of First Refusal Agreement dated May 16, 1998
                           with Bailey Financial Corporation and the Bank.
                           (incorporated by reference to the Bank's Registration
                           Statement on Form 10-SB filed July 30, 1998).

                  10.2     Share Exchange Agreement dated April 6, 1998 with
                           Bailey Financial Corporation and the Bank.
                           (incorporated by reference to the Bank's Registration
                           Statement on Form 10-SB filed July 30, 1998).

                  13.1.    Annual Report of Shareholders for the year ended
                           December 31, 1999

                  21.1     Subsidiaries of the Company

                  27.1.    Financial Data Schedule. (for SEC use only).

--------------------
*        Denotes executive compensation contract or arrangement.

(b)      Reports on Form 8-K

         No reports were filed on Form 8-K during the fourth quarter of 1999.


                                       17