<PAGE>
 
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB

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

For the quarterly period ended March 31, 1998.

Commission File No. 0-27448

GOLDEN ISLES FINANCIAL HOLDINGS, INC.
(Exact name of small business issuer as specified in its charter)


Georgia                                 58-1756713
(State of Incorporation)                (I.R.S. Employer Identification No.)


3811 Frederica Road, St. Simons Island, Georgia 31522
(Address of Principal Executive Offices)

(912) 638-0667
(Issuer's Telephone Number, Including Area Code)

(Former Name, Former Address and Former Fiscal Year, if Changed
Since Last Report)

Check whether the issuer (1) 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 issuer was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.

Yes   X         No
     ----           ----

APPLICABLE ONLY TO CORPORATE ISSUERS:  Indicate the number of shares
outstanding of each of the issuer's classes of common equity as
of the latest practicable date.

Common Stock, no par value per share:   2,313,645 shares issued and
outstanding as of May 7, 1998.

Transitional Small Business Disclosure Format:

Yes             No   X
     ----           ----
<PAGE>
 
PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements
 
Golden Isles Financial Holdings, Inc.
St. Simons Island, Georgia
Consolidated Balance Sheets
                                             March 31,          December 31,
                                               1998                1997
ASSETS                                      (Unaudited)          (Audited)
Cash and due from banks                    $  2,495,598        $  3,224,761
Federal funds sold                            4,420,000           2,330,000
                                            -----------         -----------
  Total cash and cash equivalents          $  6,915,598        $  5,554,761
Investment securities                                   
 available-for-sale at                                  
 at estimated market values                  17,533,639          16,787,502
Loans, net                                   90,524,586          87,431,438
Loans held-for-sale                                  --             307,457
Property and equipment, net                   3,257,096           3,195,582
Other assets                                  2,587,386           2,256,116
                                            -----------         -----------

Total Assets                               $120,818,305        $115,532,856
                                           ============        ============

 
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits
 Non-interest bearing deposits             $  9,531,845        $  7,251,295
 Interest bearing deposits                   85,125,588          83,539,462
                                            -----------         -----------
  Total deposits                           $ 94,657,433        $ 90,790,757
                                            -----------         -----------
  
Notes payable                                 9,040,000           9,367,458
Federal Home Loan Bank borrowings             4,789,671           3,879,171
Other liabilities                             1,233,705             745,665
                                             ----------           ---------
                                                                 
Total Liabilities                          $109,720,809        $104,783,051
                                            -----------         ----------- 
 
Commitments and contingencies
Shareholders' Equity:
 Common stock, no par value
  50 million shares authorized, 
  2,313,645 shares issued
   and outstanding                         $  1,094,338        $  1,094,338
Paid-in-capital                               9,967,360           9,959,244
Retained (deficit)                              (67,758)           (360,699)  
Accumulated other
  comprehensive income                          103,556              56,922
                                            -----------         ----------- 
                                                          
  Total Shareholders' Equity               $ 11,097,496        $ 10,749,805
                                            -----------         -----------
                                                                  
  Total Liabilities and 
   Shareholders' Equity                    $120,818,305        $115,532,856
                                            ===========         ===========

Refer to notes to the financial statements.

Golden Isles Financial Holdings, Inc.
St. Simons Island, Georgia
Consolidated Statements of Income and Comprehensive Income

                                      -2-
<PAGE>
 
(Unaudited)
                                                   Three Months Ended
                                                       March 31,
                                                 1998                1997

Interest income                            $   2,887,088        $   2,549,306
 
Interest expense                               1,453,408            1,354,261
                                             -----------         ------------

Net interest income                            1,433,680            1,195,045
 
Provision for possible loan losses                96,657               (1,033)
                                            ------------         ------------

Net interest income after provision
 for possible loan losses                      1,337,023            1,196,078
                                            ------------         ------------

Other income                                     241,713              541,512
                                            ------------         ------------ 
 
Salaries and benefits                            647,855              812,145
Depreciation and amortization                     82,692               71,858
Regulatory fees and assessments                    9,566               14,233
Supplies and printing                             31,711               40,353
Legal & professional                              61,978              149,214
Advertising                                       43,295               24,613
Other operating expenses                         274,516              479,226
                                            ------------         ------------
                                                          
   Total operating expenses                    1,151,613            1,591,642
                                            ------------         ------------ 
 Net income before taxes                   $     427,123        $     145,948
                                                          
 Income taxes                                    134,183               87,750
                                            ------------         ------------ 
Net income                                 $     292,940        $      58,198
                                            ============         ============
                                                          
 Other comprehensive income, net of tax:                  
 Unrealized holding gains/(losses)                       
   arising during period                          46,634              (46,878)
                                            ------------         ------------ 
                                                         
 Comprehensive income                      $     339,574        $      11,320
                                            ============         ============
                                                         
                                                         
                                                         
 Income per share-Basic                    $        .127        $        .025
                                            ============         ============
                                                         
 Income per share-Diluted                  $        .126        $        .025
                                            ============         ============
                                                         
Average Shares Outstanding                     2,313,645            2,344,303
                                            ============         ============
  
 Refer to notes to the financial statements.
 
                                      -3-
<PAGE>
 
Golden Isles Financial Holdings, Inc.
St. Simons Island, Georgia
Consolidated Statements of Cash Flows
(Unaudited)
                                                     Three Months Ended
                                                           March 31,
                                                 1998                 1997

Cash flows from operating activities:      $     675,709        $     544,055
                                            ------------         ------------  

Cash flows from Investing Activities:
   Decrease in loans held-for-sale         $     307,457        $   5,926,628
   (Purch)/Sale of fixed assets                 (144,208)              28,675
   Increase in loans                          (3,189,817)          (4,611,871)
  Securities - available-for-sale
   Maturity and paydowns                       3,725,634              588,231
   Sale of securities                              - -                  - -
   Purchase of securities                     (4,471,771)          (3,525,358)
  Securities - held-to-maturity
   Purchase of securities                          - -                  - -
   Maturity and paydowns                           - -                172,564
                                            ------------         ------------  
 
Net cash used in investing activities      $  (3,772,705)       $  (1,421,131)
                                            ------------         ------------  
 
Cash flows from Financing Activities:
  Incr/(decr) in various borrowings        $     583,042        $  (6,230,828)
  Sale of stock/option amortization                8,115               18,308
  Increase in deposits                         3,866,676              532,415
                                            ------------         ------------  
 
Cash provided from/(used in)financing
 activities                                $   4,457,833        $  (5,680,105) 
                                            ------------         ------------  
Net incr/(decr) in cash and cash
  equivalents                              $   1,360,837        $  (6,557,181)

Cash and cash equivalents,
beginning of period                            5,554,761           12,890,836
                                            ------------         ------------  
Cash and cash equivalents, end of
  period                                   $   6,915,598        $   6,333,655
                                            ============         ============


Refer to notes to the financial statements.

                                      -4-
<PAGE>
 
Golden Isles Financial Holdings, Inc.
St. Simons Island, Georgia
Notes to Financial Statements (Unaudited)
March 31, 1998

Note 1 - Basis of Presentation

The accompanying financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-QSB.  Accordingly, they do not include all the
information and footnotes required by generally accepted accounting principles
for complete financial statements.  In the opinion of management, all
adjustments (consisting of normal recurring  accruals) considered  necessary
for a fair presentation have been included.  Operating results for the three-
month period ended March 31, 1998 are not necessarily indicative of the results
that may be expected for the year ending December 31, 1998.  For further
information, refer to the financial statements and footnotes thereto included in
Form 10-KSB for the year ended December 31, 1997.

Note 2 - Summary of Significant Accounting Policies

Basis of Presentation and Reclassification.  The consolidated financial
statements include the accounts of the parent company and the Subsidiaries.  All
significant intercompany accounts and transactions have been eliminated in
consolidation.

Basis of Accounting.  The accounting and reporting policies of GIFH conform to
generally accepted accounting principles and to general practices in the banking
industry.  GIFH uses the accrual basis of accounting by recognizing revenues
when earned and expenses in the period incurred, without regard to the time of
receipt or payment of cash.

Loans, Interest and Fee Income on Loans.  Loans are stated at the principal
balance outstanding.  Unearned discount, unamortized loan fees and the allowance
for possible loan losses are deducted from total loans in the statement of
condition.  Interest income is recognized over the term of the loan based on the
principal amount outstanding.  Points on real estate loans are taken into income
to the extent they represent the direct cost of initiating a loan.  The amounts
in excess of direct costs are deferred and amortized over the expected life of
the loan.

Loans are generally placed on non-accrual status when principal or interest
becomes ninety days past due, or when payment in full is not anticipated.  When
a loan is placed on non-accrual status, interest accrued but not received is
generally reversed against interest income.  If collectibility is in doubt, cash
receipts on non-accrual loans are not recorded as interest income, but are used
to reduce principal.

Allowance for Possible Loan Losses. The provisions for loan losses charged to
operating expense reflect the amount deemed appropriate by management to
establish an adequate reserve to meet the present and foreseeable risk
characteristics of the current loan portfolio.

Golden Isles Financial Holdings, Inc.
St. Simons Island, Georgia

                                      -5-
<PAGE>
 
Notes to Financial Statements (Unaudited)
March 31, 1998

Management's judgement is based on periodic and regular evaluation of individual
loans, the overall risk characteristics of the various portfolio segments, past
experience with losses and prevailing and anticipated economic conditions.
Loans which are determined to be uncollectible are charged against the
allowance.  Provisions for loan losses and recoveries on loans previously
charged-off are added to the allowance.

In May 1995, FASB issued Statement of Financial Accounting Standards No. 122,
Accounting for Mortgage Servicing Rights, (SFAS 122).  SFAS 122 amends SFAS 65,
Accounting for Certain Mortgage Banking Activities, to require that a mortgage
banking enterprise recognize as an asset rights to service mortgage loans for
others regardless of the manner in which those servicing rights are acquired.
It also requires an enterprise to assess its capitalized mortgage servicing
rights for impairment based on the fair value of those rights.  In assessing
impairment, Management believes that the adoption of SFAS 122 will not have a
material impact on the financial position of GIFH.

Property and Equipment.  Building, furniture and equipment are stated at cost,
net of accumulated depreciation.  Depreciation is computed using the straight
line method over the estimated useful lives of the related assets.  Maintenance
and repairs are charged to operations, while major improvements are capitalized.
Upon retirement, sale or other disposition of property and equipment, the cost
and accumulated depreciation are eliminated from the accounts, and gain or loss
is included in income from operations.

Income Taxes.  The consolidated financial statements have been prepared on the
accrual basis.  When income and expenses are recognized in different periods for
financial reporting purposes and for purposes of computing income taxes
currently payable, deferred taxes are provided on such temporary differences.

Statement of Cash Flows.  For purposes of reporting cash flows, cash
and cash equivalents include cash on hand, amounts due from banks and federal
funds sold.  Generally, federal funds are purchased or sold for one day periods.

Net Income/(Loss) Per Share.  Net income per share was computed by dividing net
income by the weighted average number of shares outstanding for each period.
Common stock equivalents in the form of outstanding stock options were included
in the determination of the weighted average number of shares outstanding only
if they were dilutive.  Income per share of $.127 for the three-month period
ended March 31, 1998 may not be indicative of projected earnings/(losses) for
the year ending December 31, 1998.

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.

Liquidity and Sources of Capital

Golden Isles Financial Holdings, Inc., St. Simons Island, Georgia 

                                      -6-
<PAGE>
 
(GIFH) was incorporated under the laws of the State of Georgia in 1987 for the
purpose of becoming a holding company for its then proposed de novo bank, The
First Bank of Brunswick, Brunswick, Georgia (the Bank). Upon commencement of the
Bank's principal operations on July 2, 1990, GIFH acquired 100 percent of the
Bank's voting stock by injecting $4.5 million into the Bank's capital accounts.
Subsequently, an additional $1.1 million was injected into the Bank's capital
accounts. Deposits at the Bank are each insured up to $100,000 by the Federal
Deposit Insurance Corporation.

In late 1993, GIFH formed two subsidiaries, First Credit Service Corporation,
Brunswick, Georgia (FCC) and First Bank Mortgage Corporation, Brunswick, Georgia
(FBMC).  FCC engages in consumer finance and credit related insurance
activities. FBMC ceased operations as of April 30, 1997.  From inception to
March 31,1998, GIFH injected $2,085,000 and $2,875,000 into the capital accounts
of FCC and FBMC, respectively.  GIFH owns 100 percent of the voting shares of
the Bank, FCC and FBMC.

In the following discussion, unless any information is specifically identified
as reflecting the financial condition of the Bank, FCC or FBMC, it is intended
to reflect the financial condition of GIFH on a consolidated basis.

Liquidity is the company's ability to meet all deposit withdrawals immediately,
while also providing for the credit needs of customers.  The March 31, 1998,
financial statements evidence a fair liquidity position as total cash and cash
equivalents amounted to $6.9 million, representing 5.7% of total assets.
Investment securities amounted to $17.5 million, representing 14.5% of total
assets; these securities provide a secondary source of liquidity since they can
be converted into cash in a timely manner.  Note that the Company's ability to
maintain and expand its deposit base and borrowing capabilities are a source of
liquidity.  For the three-month period ended March 31, 1998, total deposits
increased from $90.8 million to $94.7 million, representing an increase of 4.3%.
GIFH's management closely monitors and maintains appropriate levels of interest
earning assets and interest bearing liabilities, so that maturities of assets
are such that adequate funds are provided to meet customer withdrawals and loan
demand.  There are no trends, demands, commitments, events or uncertainties that
will result in or are reasonably likely to result in GIFH's liquidity increasing
or decreasing in any material way.

Effective March 29, 1997, the Company entered into a credit facility with
American Banking Company, Moultrie, Georgia.  Under the facility the Company
borrowed $3,500,000 as a term loan to be used for repayment of the line of
credit at Southeastern Bank, and had up to $1,000,000 as a revolving line of
credit to be used for working capital.  The interest rate with respect to both
loans is .25% over the Suntrust Bank, Atlanta prime rate.  The term loan calls
for quarterly interest only payments for the first eighteen months and for
quarterly principal and interest payments over five additional years, principal
being repaid on the basis of a ten year amortization and semi-annual principal
reductions of $175,000.  The revolving line of credit matured March 25, 1998,
with no outstanding balance.  The term loan is secured by a pledge of the stock
of the Bank owned by the Company.

The Bank maintains an adequate level of capitalization as measured 

                                      -7-
<PAGE>
 
by the following capital ratios and the respective minimum capital requirements
by the Bank's primary regulators.

                             Bank's              Minimum required by
                        March 31, 1998          regulatory authorities
Leverage ratio                7.9%                       4.0%
Risk weighted ratio          11.9%                       8.0%

Note that with respect to the leverage ratio, the regulators expect a minimum of
5.0 percent to 6.0 percent ratio for banks that are not rated CAMEL 1.  Although
the Bank is not rated CAMEL 1, its leverage ratio of 7.9 percent is well above
the required minimum.

Results of Operations

Net income for the three-month period ended March 31, 1998, amounted to
$292,940, or $.127 per share.  The primary reason for the increase in earnings
is attributed to the closing of FBMC and improved earnings at the Bank. FCC was
also profitable for the first quarter of 1998. Operating expenses for the first
quarter of 1998 were almost $450,000 less than the same period of 1997.
Salaries and benefits were down 20% from the same time last year.  Legal,
professional and other expenses were also lower than the same period  in 1997
because 1997 figures included the costs related to the March 11, 1997, Special
Meeting of Shareholders.   Several other items are of interest when compared to
the results of the same three months of 1997.

a.   Net interest income, which represents the difference between interest
     received on interest earning assets and interest paid on interest bearing
     liabilities, has increased from $1,195,045 for the three-month period ended
     March 31, 1997 to $1,433,680 for the same period one year later,
     representing an increase of $238,635, or 20%.  This increase was attained
     because total interest earning assets increased from $98.5 million at March
     31, 1997, to $113.0 million at March 31, 1998.

b.   The net interest yield, defined as net interest income divided by interest
     earning assets, increased slightly from 4.9% for the three-month period
     ended March 31, 1997, to 5.1% for the three-month period ended March 31,
     1998.

c.   Other income for the three-month period ended March 31, 1998 and 1997
     amounted to $241,713 and $541,512 respectively.  The decrease in other
     income is due primarily to the loss of fee income and other charges that
     were earned through FBMC.

d.   Operating expenses for the three-month period ended March 31, 1998 and 1997
     amounted to $1,151,613 and $1,591,642 respectively, representing an
     decrease of $440,029, or 28%.  Operating expenses represented an annualized
     3.8% and 6.0% of total assets as of March 31, 1998 and 1997, respectively.
     Salaries and benefits were 20% lower for the first quarter 1998 compared to
     1997.  The first quarter of 1997 operating expenses include one time costs
     associated with the March 11, 1997, Special Meeting.

e.   The provision for loan losses was almost $98,000 more for the first three
     months of 1998 versus the same period of 1997.This is due to the fact that
     there was an excess in the loan loss 

                                      -8-
<PAGE>
 
     reserve during the first quarter of 1997. The allowance for loan losses as
     a percentage of gross loans remained constant at 1.7% from the same time
     last year. Management considers the allowance for loan losses to be
     adequate and sufficient to absorb possible future losses; however, there
     can be no assurance that charge-offs in future periods will not exceed the
     allowance for loan losses or that additional provisions to the allowance
     will not be required.


GIFH is not aware of any current recommendation by the regulatory authorities
which, if they were to be implemented, would have a material effect on GIFH's
liquidity, capital resources, or results of operations.


PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.  As of March 31, 1998, there are no material pending
legal proceedings to which the Company or any of its subsidiaries is a party or
of which any of their property is the subject.

Item 2.  Changes in Securities.

     (a)  None.

     (b)  None.

Item 3.  Defaults Upon Senior Securities.  None.

Item 4.  Submission of Matters to a Vote of Security Holders.  None.

Item 5.  Other Information. None.

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

     (a)  Exhibits

     Exhibit No:  Description

     27     Financial Data Schedule

     (b)    Reports on Form 8-K - There were no reports on Form 8-K filed during
            the quarter ended March 31, 1998.


SIGNATURES


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

GOLDEN ISLES FINANCIAL HOLDINGS, INC.


Date:  May 13, 1998

By: /s/ J. Thomas Whelchel

 J. Thomas Whelchel
 Chairman

                                      -9-
<PAGE>
 
INDEX TO EXHIBITS

Exhibit                                   Sequential
Number         Description                Page Number

  27       Financial Data Schedule            11

                                      -10-