SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB
                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

    For the Quarterly Period Ended                         Commission file
            March 31, 1999                                    000-20616

                          PEOPLES BANCORPORATION, INC.
          (Exact name of small business issuer as specified in charter)


            South Carolina                                   57-09581843
    (State or other jurisdiction of                        (I.R.S. Employer
    incorporation or organization)                       Identification No.)

               1800 East Main Street, Easley, South Carolina 29640
               (Address of principal executive offices)     (Zip Code)

                    Issuer's telephone number: (864) 859-2265

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

                             Yes ___X___ No _______

The number of outstanding shares of the issuer's $1.67 par value common stock as
of March 31, 1999 was 2,841,401.

                 Transitional Small Business Disclosure Format:

                             Yes _______ No ___X___



<PAGE>

PART I - FINANCIAL INFORMATION
Item 1.   Financial Statements.



                  Peoples Bancorporation, Inc. and Subsidiaries
                           Consolidated Balance Sheets

<TABLE>
<CAPTION>
                                                                                           March 31, 1999          December 31, 1998
                                                                                             Unaudited                    Audited
                                                                                             ---------                    -------
ASSETS
<S>                                                                                        <C>                        <C>          
CASH AND DUE FROM BANKS ......................................................             $   5,609,974              $   3,413,192
FEDERAL FUNDS SOLD ...........................................................                15,860,000                 17,980,000
SECURITIES
     Available for sale ......................................................                32,655,179                 31,970,972
     Held for investment (market value of $4,348,398
          and $4,264,583) ....................................................                 4,226,214                  4,128,267
LOANS-less allowance for loan losses of $1,200,284
     and $1,093,280 ..........................................................                99,507,515                 86,923,604
PREMISES AND EQUIPMENT, net of accumulated
     depreciation and amortization ...........................................                 5,948,820                  4,926,263
ACCRUED INTEREST RECEIVABLE ..................................................                 1,106,017                    922,430
OTHER ASSETS .................................................................                 1,753,232                  1,406,612
                                                                                           -------------              -------------
          TOTAL ASSETS .......................................................             $ 166,666,951              $ 151,671,340
                                                                                           =============              =============

LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
DEPOSITS
     Noninterest-bearing .....................................................             $  18,855,679              $  14,991,107
     Interest-bearing ........................................................               114,101,767                105,109,104
                                                                                           -------------              -------------
          Total deposits .....................................................               132,957,446                120,100,211
SECURITIES SOLD UNDER REPURCHASE
     AGREEMENTS ..............................................................                 7,905,969                  5,979,994
NOTES PAYABLE FEDERAL HOME LOAN BANK .........................................                 2,000,000                  2,000,000
ACCRUED INTEREST PAYABLE .....................................................                   799,604                    867,014
OTHER LIABILITIES ............................................................                    85,395                    253,014
                                                                                           -------------              -------------
          Total Liabilities ..................................................               143,748,414                129,200,233
                                                                                           -------------              -------------
SHAREHOLDERS' EQUITY
Common  Stock -  10,000,000 shares authorized, 
  $1.67 par value  per share, 2,841,401 and
  2,764,016 shares outstanding ...............................................                 4,745,140                  4,615,907
Additional paid-in capital ...................................................                17,305,572                 17,092,059
Retained Earnings ............................................................                   996,101                    810,885
Accumulated other comprehensive income .......................................                  (128,276)                   (47,744)
                                                                                           -------------              -------------
          Total Shareholder's Equity .........................................                22,918,537                 22,471,107
                                                                                           -------------              -------------
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY ....................................             $ 166,666,951              $ 151,671,340
                                                                                           =============              =============
</TABLE>



                                       1
<PAGE>


                 Peoples Bancorporation, Inc. and Subsidiaries
                        Consolidated Statements of Income
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                                                                        Three Months Ended
                                                                                                             March 31,
                                                                                                   1999                      1998
                                                                                                   ----                      ----
INTEREST INCOME
<S>                                                                                             <C>                     <C>        
   Interest and fees on loans ....................................................              $2,180,688              $ 1,804,202
   Interest on securities
       Taxable ...................................................................                 466,506                  304,377
       Tax-exempt ................................................................                  53,634                   60,907
   Interest on federal funds .....................................................                 188,720                   85,105
                                                                                                ----------              -----------
Total interest income ............................................................               2,889,548                2,254,591
                                                                                                ----------              -----------

INTEREST EXPENSE
   Interest on deposits ..........................................................               1,125,788                1,017,382
   Interest on federal funds purchased and securities
       sold under repurchase agreements ..........................................                  67,962                   36,650
Interest on notes payable Federal Home Loan Bank .................................                  26,067                   28,530
                                                                                                ----------              -----------
Total interest expense ...........................................................               1,219,817                1,082,562
                                                                                                ----------              -----------

Net interest income ..............................................................               1,669,731                1,172,029

PROVISION FOR LOAN LOSSES ........................................................                 119,450                   (2,500)
                                                                                                ----------              -----------

Net interest income after provision for loan losses ..............................               1,550,281                1,174,529

NON-INTEREST INCOME
   Service fees and other income .................................................                 367,808                  254,901
                                                                                                ----------              -----------

NON-INTEREST EXPENSES
   Salaries and benefits .........................................................                 841,259                  500,083
   Occupancy .....................................................................                  61,654                   56,974
   Equipment .....................................................................                 106,198                   66,698
   Other operating expenses ......................................................                 477,760                  272,162
                                                                                                ----------              -----------
                                                                                                 1,486,871                  895,917
                                                                                                ----------              -----------
   Income before income taxes ....................................................                 431,218                  533,513

PROVISION FOR INCOME TAXES .......................................................                 146,600                  176,000
                                                                                                ----------              -----------

   Net income ....................................................................              $  284,618              $   357,453
                                                                                                ==========              ===========

INCOME PER COMMON SHARE:
   BASIC .........................................................................              $     0.10              $      0.20
                                                                                                ==========              ===========
   DILUTED .......................................................................              $     0.10              $      0.19
                                                                                                ==========              ===========

WEIGHTED AVERAGE COMMON SHARES:
   BASIC .........................................................................               2,840,468                1,777,661
                                                                                                ==========              ===========
   DILUTED .......................................................................               2,934,327                1,913,520
                                                                                                ==========              ===========

DIVIDENDS PAID PER COMMON SHARE ..................................................              $    0.035              $     0.033
                                                                                                ==========              ===========
</TABLE>


                                       2
<PAGE>


                  Peoples Bancorporation, Inc. and Subsidiaries
           Consolidated Statements of Changes in Shareholders' Equity
               for the three months ended March 31, 1999 and 1998
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                         
                                                                                                        Accumulated
                                                                       Additional                          other           Total
                                               Common stock              paid-in          Retained      comprehensive  shareholders'
                                         Shares           Amount         capital          earnings         income          equity
                                         ------           ------         -------          --------       ------------      ------
<S>                                    <C>          <C>              <C>              <C>               <C>            <C>         
Balance, December 31, 1997 ........    1,687,250    $    2,817,708   $   5,158,024    $    1,553,206    $ (19,449)     $  9,509,489
Net Income ........................                                                          357,453                        357,453
Other comprehensive income, net of                                                                                    
tax:                                                                                                                  
   Unrealized holding gains on                                                                                        
   securities available for sale ..                                                                           561               561
   Less reclassification                                                                                              
   adjustments for gains                                                                                              
   included in net income .........                                                                             0                 0
                                                                                                        ---------      ------------
Comprehensive income ..............                                                                                         358,014
Cash Dividends ....................                                                          (58,687)                       (58,687)
Proceeds from stock options .......        5,760             9,619          13,306                                           22,925
                                       ---------    --------------   -------------    --------------    ---------      ------------
Balance, March 31, 1998 ...........    1,693,010    $    2,827,327   $   5,171,330    $    1,851,972    $ (18,888)     $  9,831,741
                                       =========    ==============   =============    ==============    =========      ============
                                                                                                                      
Balance, December 31, 1998 ........    2,764,016    $    4,615,907   $  17,092,059    $      810,885    $ (47,744)     $ 22,471,107
Net Income ........................                                                          284,618                        284,618
Other comprehensive income, net of                                                                                    
tax:                                                                                                                  
   Unrealized holding losses on                                                                                       
   securities available for sale ..                                                                       (80,532)          (80,532)
   Less reclassification                                                                                              
   adjustments for gains                                                                                              
   included in net income .........                                                                             0                 0
                                                                                                        ---------      ------------
Comprehensive income ..............                                                                                         204,086
Cash Dividends ....................                                                          (99,402)                       (99,402)
Proceeds from stock options .......       77,385           129,233         213,513                                          342,746
                                       ---------    --------------   -------------    --------------    ---------      ------------
Balance, March 31, 1999 ...........    2,841,401    $    4,745,140   $  17,305,572    $      996,101    $(128,276)     $ 22,918,537
                                       =========    ==============   =============    ==============    =========      ============
</TABLE>

                                       3
<PAGE>



                  Peoples Bancorporation, Inc. and Subsidiaries
                      Consolidated Statements of Cash Flows
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                                                         Three Months Ended
                                                                                                             March 31,
                                                                                                    1999                    1998
                                                                                                    ----                    ----
CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                                                            <C>                      <C>        
   Net Income .....................................................................            $    284,618             $   357,453
   Adjustments to reconcile net income to net cash provided
     (used) by operating activities
   Provision for loan losses ......................................................                 119,450                  (2,500)
   Depreciation and amortization ..................................................                  76,807                  49,804
   Amortization and accretion (net) of premiums and
     discounts on securities ......................................................                  28,445                  14,833
   (Increase) decrease in accrued interest receivable .............................                (183,587)                 21,233
   Increase in other assets .......................................................                (346,620)               (265,678)
   Increase in accrued interest payable ...........................................                  67,410                 118,395
   Decrease in other liabilities ..................................................                (167,619)               (203,100)
                                                                                               ------------             -----------
     Net cash provided by operating activities ....................................                (121,096)                 90,440
                                                                                               ------------             -----------

CASH FLOWS FROM INVESTING ACTIVITIES
   Purchases of securities held for investment ....................................                (100,400)                      0
   Purchases of securities available for sale .....................................              (6,587,590)             (8,267,090)
   Proceeds from the maturity of securities available for sale ....................               2,721,904                 938,769
   Proceeds from the call of securities available for sale ........................               3,060,000               2,700,000
   Net (increase) decrease in loans ...............................................             (12,703,361)                 32,068
   Purchase of premises and equipment .............................................              (1,219,229)               (325,734)
                                                                                               ------------             -----------
     Net cash used by investing activities ........................................             (14,828,676)             (4,921,987)
                                                                                               ------------             -----------

CASH FLOWS FROM FINANCING ACTIVITIES
   Net increase in deposits .......................................................              12,857,235               7,635,041
   Net increase (decrease) in securities sold under
     repurchase agreements ........................................................               1,925,975              (1,702,155)
   Net decrease in notes payable Federal Home Loan Bank ...........................                       0                 (30,612)
   Proceeds from stock options exercised ..........................................                 342,746                  22,925
   Cash dividend ..................................................................                 (99,402)                (59,115)
                                                                                               ------------             -----------
     Net cash provided by financing activities ....................................              15,026,554               5,866,084
                                                                                               ------------             -----------
     Net increase in cash and cash equivalents ....................................                  76,782               1,034,537
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR ......................................              21,393,192               8,478,784
                                                                                               ------------             -----------
CASH AND CASH EQUIVALENTS, END OF PERIOD ..........................................            $ 21,469,974             $ 9,513,321
                                                                                               ============             ===========

CASH PAID FOR
     Interest .....................................................................            $  1,287,227             $   890,327
                                                                                               ============             ===========
     Income Taxes .................................................................            $    162,018             $    19,003
                                                                                               ============             ===========
</TABLE>







                                       4
<PAGE>


                  PEOPLES BANCORPORATION, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     A summary  of these  policies  is  included  in the 1998  Annual  Report to
shareholders and incorporated herein by reference.

STATEMENT OF CASH FLOWS

    Cash  includes  currency  and coin,  cash items in  process  of  collection,
amounts due from banks and federal funds sold.

COMMON STOCK

    The Board of Directors  declared a cash  dividend of $0.035 per common share
to shareholders of record March 18, 1999, payable March 31, 1999.

    The Company adopted SFAS No. 128,  Earnings per Share, on December 31, 1997.
This  statement  requires that the Company  present basic and diluted net income
per share.  The assumed  conversion  of stock  options  creates  the  difference
between  basic and diluted net income per share.  Income per share is calculated
by  dividing  net  income  by the  weighted  average  number  of  common  shares
outstanding  for each period  presented.  The weighted  average number of common
shares  outstanding for basic net income per common share was 2,840,468 at March
31, 1999 and 1,777,661 at March 31, 1998. The weighted  average number of common
shares  outstanding  for diluted net income per common  share was  2,934,327  at
March 31, 1999 and 1,913,520 at March 31, 1998.

    In 1998 the Company completed the sale of 925,000 shares of its Common Stock
through two public stock  offerings.  In connection  with these  offerings,  the
Company received net proceeds totaling  $11,950,000.  $4,500,000 of the proceeds
was used to initially  capitalize  Bank of Anderson,  N.A. in September 1998 and
$3,500,000  was used to initially  capitalize  Seneca  National Bank in February
1999.  In January,  1999,  the Company  used a total of  $2,000,000  in proceeds
raised  from the two stock  offerings  in 1998 to inject  additional  capital of
$1,000,000 in Bank of Anderson,  N.A. and  $1,000,000  in additional  capital in
Peoples  National  Bank to support  anticipated  future  growth.  The  remaining
proceeds  from the two stock  offerings  in 1998 are being  held at the  Company
level and will be used for general corporate purposes.

     The Company issued a  five-percent  common stock dividend in December 1998.
Per share data in 1998 has been restated to reflect this transaction.

MANAGEMENT'S OPINION

    In  the  opinion  of  management,   the  accompanying   unaudited  financial
statements of Peoples Bancorporation,  Inc. contain all adjustments necessary to
fairly  present the  financial  results of the interim  periods  presented.  The
results of operations for any interim period are not  necessarily  indicative of
the results to be expected for an entire year.


                                       5
<PAGE>


Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

    The following discussion and analysis should be read in conjunction with the
consolidated  financial  statements  and related notes and with the  statistical
information  and  financial  data  appearing  in this report as well as the 1998
Annual  Report of  Peoples  Bancorporation,  Inc.  on Form  10-KSB.  Results  of
operations for the three-month  period ending March 31, 1999 are not necessarily
indicative of the results to be attained for any other period.

Forward Looking Statements

         From time to time, the Company may publish  forward-looking  statements
relating  to  such  matters  as  anticipated  financial  performance,   business
prospects,  technological  developments,  new products and similar matters.  The
Private  Securities  Litigation  Reform Act of 1995  provides a safe  harbor for
forward-looking  statements.  In order  to  comply  with  the  terms of the safe
harbor,  the Company  notes that a variety of factors  could cause the Company's
actual results and experience to differ materially from the anticipated  results
or other expectations expressed in the Company's forward-looking statements. The
risks  and   uncertainties   that  may  affect  the  operations,   performances,
development and results of the Company's  business include,  but are not limited
to, the  following:  risks from  changes in economic  and  industry  conditions;
changes in interest rates;  risks inherent in making loans  including  repayment
risks and value of collateral;  dependence on senior management;  risks relating
to year  2000  technology  compliance  of the  Company  and its  customers;  and
recently-enacted or proposed  legislation.  Statements  contained in this filing
regarding the demand for the Company's products and services,  changing economic
conditions,  interest rates, consumer spending and numerous other factors may be
forward-looking statements and are subject to uncertainties and risks.

Overview

      Peoples Bancorporation,  Inc. was incorporated under South Carolina law on
March 6, 1992,  for the purpose of becoming a bank holding  company by acquiring
all of the Common Stock of The Peoples  National Bank,  Easley,  South Carolina.
The  Company  commenced  operations  on July 1, 1992 upon  effectiveness  of the
acquisition of The Peoples  National  Bank.  The Company has three  wholly-owned
subsidiaries: The Peoples National Bank, Easley, South Carolina, a national bank
which commenced business  operations in August 1986; Bank of Anderson,  National
Association,  Anderson, South Carolina, a national bank which commenced business
operations in September 1998; and, Seneca National Bank, Seneca, South Carolina,
a national bank which commenced business  operations in February 1999 (sometimes
referred to herein as "the Banks").

     The Company engages in no significant  operations  other than the ownership
of its three  subsidiaries  and the support  thereof.  The Company  conducts its
business  from  five  banking  offices  located  in the  Upstate  Area of  South
Carolina.


                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

EARNINGS REVIEW

     The Company's  net income for the first  quarter of 1999 was  $285,000,  or
$0.10 per fully diluted share  compared to $357,000,  or $0.19 per fully diluted
share for the first  quarter  of 1998.  Return on  average  equity for the three
months  ended March 31, 1999 was 5.08%  compared to 14.67% for the three  months
ended March 31, 1998.  Return on average assets for the three months ended March
31, 1999 was 0.72%  compared to 1.22% for the three months ended March 31, 1998.
The decreases in the  Company's net income and return on average  assets in 1999
are attributable to pre-opening and early operating  losses  associated with the
opening of Seneca  National Bank in February 1999 and continued  early operating
losses  associated  with  Bank  of  Anderson,   N.A.  which  commenced  business
operations  in September  1998.  The decrease in earnings per diluted  share and
return on average equity is also attributable to pre-opening and early operating
losses  associated  with the opening of Seneca National Bank and early operating
losses  associated  with  Bank of  Anderson,  coupled  with an  increase  in the
Company's number of outstanding  shares of common stock and total equity capital
as a result of the two public stock offerings completed in 1998.

     The largest  component of the Company's net income is net interest  income.
Net interest  income,  which is the  difference  between the interest  earned on
assets and the  interest  paid for the  liabilities  used to fund those  assets,
measures  the gross  profit from  lending and  investing  activities  and is the
primary  contributor  to the  Company's  earnings.  Net interest  income  before
provision for loan losses increased $498,000, or 42.5%, to $1,670,000 in the


                                       6
<PAGE>

1999-quarter  compared to  $1,172,000  in the  1998-quarter.  The  Company's net
interest  margin was 4.57% for the  1999-quarter  compared to 4.09% for the 1998
quarter.  The  increase  in net  interest  income  and the net  interest  margin
resulted  primarily  from  an  increase  in  earning  assets,  primarily  loans,
attributable  to Bank of  Anderson  and Seneca  National  Bank,  coupled  with a
decrease in the cost of  interest-bearing  liabilities  at The Peoples  National
Bank.

Non-interest Income

    Non-interest income increased $113,000,  or 44.3%, to $368,000 for the first
quarter of 1999 compared to $255,000 for the 1998-quarter. A $67,000 increase in
origination  fees on mortgage loans and $39,000  increase in service  charges on
deposit  accounts were the main  contributors to this increase.  No gain or loss
was realized on the sale of available for sale securities during the first three
months of either 1999 or 1998.

Non-interest Expense

    Total non-interest expense increased $591,000 or 66.0% for the first quarter
of 1999 over the first  quarter of 1998.  Salaries  and  benefits,  the  largest
component  of  non-interest  expense,  increased  $341,000,  or  68.2%,  in  the
1999-quarter  compared to the 1998  quarter.  This large  increase is  primarily
attributable  to the  addition of several key  employees  at the parent  company
level in the second half of 1998, the staffing of Bank of Anderson,  N.A. in the
third quarter of 1998, the staffing of Seneca National Bank in the first quarter
of 1999 and normal salary increases at The Peoples National Bank.  Occupancy and
equipment expenses,  combined,  increased $44,000, or 35.7%, in the 1999 quarter
due primarily to an increase in depreciation  expense and maintenance expense on
the equipment and buildings for Bank of Anderson,  N.A. and Seneca National, and
depreciation  and maintenance  expenses  associated with the Company's Wide Area
Network.  Other operating expense increased $206,000, or 75.5%, and is primarily
attributable  to increases in marketing and  advertising  expense,  printing and
supplies expense, and other expenses associated with Bank of Anderson,  N.A. and
Seneca National Bank.

Provision for Loan Losses

    The amount  charged to the provision for loan losses by the Company is based
on  management's  judgement  as to the amount  required to maintain an allowance
adequate to provide for potential losses in the Company's loan portfolio.

    The provision for loan losses charged to operations  during the three months
ended March 31, 1999 was $119,000 compared to a negative provision of $2,500 for
the three months ended March 31, 1998.  The increase in the Company's  provision
for loan losses in the 1999 quarter is largely  attributable  to provisions made
by Bank of  Anderson,  N.A.  and  Seneca  National  Bank  as they  continued  to
establish  their  allowance for loan losses.  During the 1999  quarter,  Bank of
Anderson made  provisions of $52,000 and Seneca National Bank made provisions of
$42,000.  The Peoples  National  Bank,  which  recorded a negative  provision of
$2,500  in the  1998  quarter  as a  result  of  net  recoveries  on  previously
charged-off  loans and a  decrease  in the  volume of  outstanding  loans,  made
provisions  of $25,000 in the 1999  quarter  as a result of an  increase  in the
volume of  outstanding  loans during the period.  At 1.19% of total  outstanding
loans,  management  considers the allowance for loan losses to be adequate based
upon  evaluations of specific  loans and weighing of various loan  categories as
suggested by the Bank's internal loan rating system.

BALANCE SHEET REVIEW

Loans

     Outstanding  loans  represent  the largest  component of earning  assets at
65.6% of total earning assets. As of March 31, 1999, the Company had total gross
loans outstanding of $100,708,000.  Loans increased $12,691,000,  or 14.4%, from
$88,017,000  in  total  gross   outstanding  loans  at  December  31,  1998  and
$23,737,000,  or 30.8% from  $76,971,000,  in total gross loans  outstanding  at
March 31, 1998. The increase resulted primarily from new loans generated by Bank
of Anderson and Seneca National Bank and internal loan growth experienced by The
Peoples National Bank.

     The interest rates charged on loans vary with the degree of risk,  maturity
and amount of the loan. Competitive pressures,  money market rates, availability
of funds, and government  regulation also influence  interest rates. The average
yield on the  company's  loans for the  quarter  ended  March 31, 1999 was 9.34%
compared to 9.18% for the quarter ended March 31, 1998.  Approximately  30.5% of
the Company's loans are tied to the prime interest rate.


                                       7
<PAGE>

     The Company's loan portfolio consists  principally of residential  mortgage
loans, commercial loans and consumer loans. Substantially all of these loans are
to borrowers  located in South  Carolina and are  concentrated  in the Company's
market  areas.  The Company has no foreign  loans or loans for highly  leveraged
transactions.

Allowance for Loan Losses

     The allowance for loan losses at March 31, 1999 was $1,200,000, or 1.19% of
loans  outstanding  compared to  $1,093,000,  or 1.24% of loans  outstanding  at
December  31, 1998.  The  allowance  for loan losses is based upon  management's
continuing  evaluation  of the  collectibility  of past due  loans  based on the
historical  loan loss  experience of the Company,  current  economic  conditions
affecting the ability of borrowers to repay, the volume of loans, the quality of
collateral  securing   non-performing  and  problem  loans,  and  other  factors
deserving recognition.

     At March 31, 1999, the Company had $513,000 in non-accruing  loans,  $8,000
in  restructured  loans and no loans  more than  ninety  days past due and still
accruing interest.  This compares to $617,000 in non-accruing  loans,  $8,000 in
restructured loans and no loans more than ninety days past due on which interest
was still being accrued at December 31, 1998.  Non-performing loans at March 31,
1999 consists of $12,000 in commercial  loans;  $490,000 in mortgage loans;  and
$11,000 in consumer  loans. Non-performing  assets as a percentage  of loans and
other real estate  owned was 0.51% and 0.74% at March 31, 1999 and  December 31,
1998, respectively.

     Net  charge-offs  during  the first  three  months  of 1999  were  $12,000,
compared to net  recoveries  of $19,000 for the first three  months 1998 and net
charge-offs  of $88,000 for the year ended  December 31, 1998. The allowance for
loan losses as a  percentage  of  nonperforming  loans was 234%,  119% and 177%,
respectively, as of March 31, 1999, March 31, 1998 and December 31, 1998.

     The Company  accounts for impaired loans in accordance  with the provisions
of Statement of Financial  Accounting  Standards  ("SFAS")  114,  Accounting  by
Creditors for  Impairment  of a Loan.  SFAS No. 114, as amended by SFAS No. 118,
requires that impaired  loans be measured based on the present value of expected
future  cash  flows  or the  underlying  collateral  values  as  defined  in the
pronouncement.  The Company  includes the provisions of SFAS NO. 114, if any, in
the allowance for loan losses.  When the ultimate  collectibility of an impaired
loan's principal is in doubt, wholly or partially, all cash receipts are applied
to  principal.  When this doubt does not exist,  cash receipts are applied under
the contractual  terms of the loan agreement first to principal then to interest
income.  Once the recorded  principal  balance has been reduced to zero,  future
cash  receipts are applied to interest  income,  to the extent that any interest
has been  foregone.  Further cash  receipts are  recorded as  recoveries  on any
amounts  previously  charged off. At each of March 31, 1999,  March 31, 1998 and
December 31, 1998 the Company had no impaired loans.

Securities

     Investment  securities  constituted 24.1% and 25.4% of earning assets as of
March  31,  1999  and  December  31,  1998,  respectively.  At March  31,  1999,
securities  totaled  $37,076,000,  up $904,000 from  $36,172,000  invested as of
December 31,  1998's.  The slight  increase is due to  increases  in  investment
securities held by Bank of Anderson and Seneca National Bank.

     At March 31, 1999, the Company's total investments  classified as available
for sale had a book value of $32,850,000  and a market value of $32,655,000  for
an unrealized net loss of $195,000.

     The  Company  uses  its  investment  portfolio  to  provide  liquidity  for
unexpected  deposit  liquidation  or  loan  generation,  to meet  the  Company's
interest rate sensitivity goals and to generate income.  The Company  emphasizes
safety in its selection of investment  securities.  Accordingly,  the investment
portfolio  is  limited to  securities  of the United  States  government  or its
agencies,  mortgage backed  securities and investment  grade state and municipal
securities.  The Company does not invest in corporate bonds nor does it hold any
trading securities.

Deposits

     The  Bank's  primary  source  of funds for  loans  and  investments  is its
deposits. Deposits grew $12,857,000, or 10.7%, to $132,957,000 at March 31, 1999
from $120,100,000 at December 31, 1998. The increase  resulted  principally from
deposits generated by Bank of Anderson and Seneca National Bank. Competition for
deposit  accounts  is  primarily  based on the  interest  rates  paid,  location
convenience and services offered.


                                       8
<PAGE>

        During  the  first  three  months  of  1999,  interest-bearing  deposits
averaged  $109,314,000  compared to  $88,381,000  for the first three  months of
1998. The average interest rate paid on interest-bearing  deposits was 4.18% for
the 1999-quarter  compared to 4.67% for the  1998-quarter.  In pricing deposits,
the Company  considers its liquidity needs, the direction and levels of interest
rates and local market conditions.  At March 31, 1999 interest-bearing  deposits
comprised 85.8% of total deposits compared to 87.68% at March 31, 1998.

        The  Company's  core deposit base  consists of consumer  time  deposits,
savings,  NOW accounts,  money market accounts and checking  accounts.  Although
such core  deposits are becoming  increasingly  interest  sensitive for both the
Company and the industry as a whole,  such core deposits continue to provide the
Company with a large and stable  source of funds.  Core deposits as a percentage
of total deposits averaged  approximately 83.4% for the three months ended March
31, 1999. The Company closely monitors its reliance on certificates greater than
$100,000, which are generally considered less stable and less reliable than core
deposits.

LIQUIDITY

        Liquidity  management involves meeting the cash flow requirements of the
Company.  The Company's  liquidity position is primarily dependent upon its need
to respond to  short-term  demand for funds caused by  withdrawals  from deposit
accounts and upon the liquidity of its assets.  The Company's  primary liquidity
sources  include  cash and due from banks,  federal  funds sold and  "securities
available  for sale".  In  addition,  the  Company  (through  the Banks) has the
ability,  on a short-term basis, to borrow funds from the Federal Reserve System
and to purchase federal funds from other financial  institutions.  The Banks are
also members of the Federal Home Loan Bank System and have the ability to borrow
both  short  and long term  funds on a secured  basis.  At March 31,  1999,  The
Peoples  National Bank had $2,000,000 in long-term  borrowings  from the Federal
Home Loan Bank of  Atlanta.  At March 31,  1999 The  Peoples  National  Bank had
unused  borrowing  capacity  from the  Federal  Home  Loan  Bank of  Atlanta  of
$14,000,000.  The Company's  other two bank  subsidiaries,  Bank of Anderson and
Seneca National Bank have not yet  established  lines of credit with the Federal
Home Loan Bank. At March 31, 1999,  the Banks had unused  federal funds lines of
credit totaling $6,000,000 with correspondent banks.

        Peoples  Bancorporation,  Inc., the parent holding company,  has limited
liquidity  needs.  Peoples  Bancorporation  requires  liquidity  to pay  limited
operating expenses and dividends.

        Company  management  believes its liquidity sources are adequate to meet
its  operating  needs  and does not know of any  trends  that may  result in the
Company's liquidity materially increasing or decreasing.

CAPITAL ADEQUACY and RESOURCES

        The capital  needs of the Company have been met through the retention of
earnings and from the proceeds of prior public stock offerings.

        For bank holding  companies with total assets of more than $150 million,
such as the  Company,  capital  adequacy is generally  evaluated  based upon the
capital of its banking  subsidiaries.  Generally,  the Board of Governors of the
Federal  Reserve  System (the  "Federal  Reserve  Board")  expects  bank holding
companies to operate above minimum capital levels. The Office of the Comptroller
of the  Currency  ("Comptroller")  regulations  establish  the minimum  leverage
capital  ratio  requirement  for national  banks at 3% in the case of a national
bank that has the highest regulatory examination rating and is not contemplating
significant  growth or  expansion.  All other  national  banks are  expected  to
maintain a ratio of at least 1% to 2% above the stated minimum. Furthermore, the
Comptroller  reserves the right to require  higher  capital ratios in individual
banks on a case by case basis  when,  in its  judgement,  additional  capital is
warranted by a deterioration of financial  condition or when high levels of risk
otherwise  exist.  The Banks  have not been  notified  that  they must  maintain
capital levels above regulatory minimums.

        The Federal  Reserve  Board has adopted a risk-based  capital rule which
requires  bank holding  companies to have  qualifying  capital to  risk-weighted
assets of at least 8%, with at least 4% being  "Tier 1" capital.  Tier 1 capital
consists principally of common stockholders'  equity,  non-cumulative  preferred
stock,  qualifying  perpetual  preferred stock, and minority interests in equity


                                       9
<PAGE>

accounts of  consolidated  subsidiaries,  less  goodwill and certain  intangible
assets.  "Tier 2" (or  supplementary)  capital  consists  of  general  loan loss
reserves (subject to certain limitations),  certain types of preferred stock and
subordinated  debt,  and  certain  hybrid  capital  instruments  and other  debt
securities such as equity commitment notes. A bank holding company's  qualifying
capital base for purposes of its risk-based  capital ratio consist of the sum of
its Tier 1 and Tier 2 capital  components,  provided that the maximum  amount of
Tier 2 capital that may be treated as  qualifying  capital is limited to 100% of
Tier 1 capital.  The Comptroller  imposes a similar  standard on national banks.
The regulatory  agencies  expect  national  bands and bank holding  companies to
operate above minimum risk-based capital levels.

        During  1998 the  Company  successfully  completed  the sale of  925,000
shares of its common stock  through two public stock  offerings.  From these two
stock offerings the company raised $12,025,000 in additional capital. $4,500,000
of this  additional  capital was used to initially  capitalize Bank of Anderson,
National  Association  in September of 1998 and $3,500,000 was used to initially
capitalize  Seneca  National Bank in February 1999. In January 1999, the Company
injected  $1,000,000  in  additional  capital in The Peoples  National  Bank and
$1,000,000  in  additional  capital in Bank of  Anderson  to provide  for future
growth  of these  two  subsidiaries.  The  remaining  funds  from the two  stock
offerings are being held at the parent company level for future operating needs.

        The  following  table sets forth the capital  ratios for the Company and
the Banks as of March 31, 1999:

                                                            CAPITAL RATIOS
                                                        (Amounts in Thousands)

<TABLE>
<CAPTION>
                                                                                         Well                     Adequately
                                                                                      Capitalized                 Capitalized
                                                            Actual                    Requirement                 Requirement
                                                   Amount           Ratio       Amount           Ratio        Amount       Ratio
                                                   ------           -----       ------           -----        ------       -----
Company:
<S>                                                <C>              <C>         <C>              <C>         <C>             <C> 
Total Risk-based Capital ................          24,247           21.94       11,052           10.00       8,841           8.00
Tier 1 Risk-based Capital ...............          23,047           20.86        6,629            6.00       4,419           4.00
Leverage Ratio ..........................          23,047           13.72        8,399            5.00       6,719           4.00

Peoples National Bank:
Total Risk-based Capital ................          12,339           13.63        9,053           10.00       7,242           8.00
Tier 1 Risk-based Capital ...............          11,326           12.51        5,432            6.00       3,621           4.00
Leverage Ratio ..........................          11,326            8.66        6,539            5.00       5,231           4.00

Bank of Anderson, N. A:
Total Risk-based Capital ................           5,348           36.00        1,486           10.00       1,188           8.00
Tier 1 Risk-based Capital ...............           5,203           35.02          891            6.00         594           4.00
Leverage Ratio ..........................           5,203           22.17        1,173            5.00         938           4.00
                                                                                             
Seneca National Bank:                                                                        
Total Risk-based Capital ................           3,396           66.19          513           10.00         410           8.00
Tier 1 Risk-based Capital ...............           3,354           65.37          308            6.00         205           4.00
Leverage Ratio ..........................           3,354           71.84          233            5.00         187           4.00
</TABLE>

EFFECTS OF REGULATORY ACTION

    The  management  of the  Company  and the Banks are not aware of any current
recommendations by regulatory authorities, which if they were to be implemented,
would have a material effect on liquidity, capital resources, or operations.



                                       10
<PAGE>

YEAR 2000

     The  Company  recognizes  that  there is a  business  risk in  computerized
systems as the new century approaches.  Many computer-based  information systems
in use today  exclude  the century as part of the date  definition,  which could
cause  inaccurate  interest  calculations  on loans  and  deposits.  A number of
computer  systems  used by the  Company  in its  day-to-day  operations  will be
affected by the "Year 2000  Problem."  Management  has  established  a Year 2000
Project Team (the "Y2K Team") which has identified  all affected  systems and is
currently working to ensure that this event will not disrupt operations. The Y2K
Team reports regularly to the Company's Board of Directors.  The Company is also
working  closely with all outside  computer  vendors to ensure that all software
corrections  and warranty  commitments  are  obtained and to implement  internal
"mock"  testing.  Testing of all systems  commenced in 1998 and was completed by
December  1998.  Alternative  vendors/programs  have  been  identified  for  all
critical  function  areas,  as classified by the Y2K Team, and will be purchased
and installed in the event the primary vendor can not provide  satisfactory  Y2K
compliance  by July 31,  1999.  Plans  are also in place in the  event  critical
systems  fail on January 1, 2000.  The  estimated  cost to the Company for these
corrective actions is $111,250, which is included in the Company's 1998 and 1999
budgets.  As of March 31, 1999, the Company's Year 2000 compliance  expenditures
totaled  $11,000.  Incomplete  or  untimely  compliance,  however,  could have a
material  adverse  effect on the Company,  the dollar  amount of which cannot be
accurately  quantified  at this  time  because  of the  inherent  variables  and
uncertainties  involved.   Factors  which  could  contribute  to  the  Company's
experiencing an adverse effect include the availability of skilled personnel and
compliant  software,  the  performance of vendors,  the ability of entities with
which the Company does  business and the  Company's  customers to resolve  their
Year 2000 problems,  and the ability to identify  non-compliant software and the
applications or functions affected.



                                       11
<PAGE>

PART II.  OTHER INFORMATION

Item 1.     Legal Proceedings

               The  Company  is  involved  in various  claims and legal  actions
               arising in the normal  course of  business.  Management  believes
               that these  proceedings will not result in a material loss to the
               Company.

Item 2.   Changes in Securities and Use of Proceeds.

               During the period ended March 31,  1999,  the  Registrant  issued
               shares of common stock to the  following  classes of persons upon
               the exercise of options issued pursuant to the Registrant's  1993
               Incentive  Stock Option Plan. The securities were issued pursuant
               to the exemption  from  registration  provided by Section 4(2) of
               the Securities Act of 1933 because the issuance did not involve a
               public offering.

                                                                 Aggregate
                              Class of       # of Shares         Exercise
          Date Issued         Purchasers       Issues              Price
          -----------         ----------       ------              -----

          01/08/99            Employees        75,985            $336,125
          03/24/99            Employee          1,400               6,622

Item 6.     Exhibits and Reports on Form 8-K

          (a)  Exhibits. See Exhibit Index.

          (b)  Reports on Form 8-K.  No report on Form 8-K was filed  during the
               quarter ended March 31, 1999






                                       12
<PAGE>

SIGNATURES

     In accordance  with the  requirements of the Securities and Exchange Act of
1934,  the  Registrant  caused  this  report to be  signed on its  behalf by the
undersigned, thereunto duly authorized.


                                    PEOPLES BANCORPORATION, INC.


Dated:  May 5, 1999                 By:    /s/ Robert E. Dye
                                         -------------------
                                           Robert E. Dye
                                           President and Chairman of the Board


Dated:  May  5, 1999                By:   /s/ William B. West
                                        ---------------------
                                           William B. West
                                           Sr. Vice President & CFO
                                           (principal financial officer)





                                       13
<PAGE>



                                  EXHIBIT INDEX


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

              27                             Financial Data Schedule