Ameris Bancorp – ‘10KSB’ for 12/31/94

As of:  Friday, 3/31/95   ·   For:  12/31/94   ·   Accession #:  931763-95-55   ·   File #:  0-16181

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Annual Report — Small Business   —   Form 10-KSB
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10KSB       Annual Report -- Small Business                       81    289K 
 2: EX-10.8     Exe Emp Agr                                           15     51K 
 3: EX-10.9     Exe Consult Agr                                        9     38K 
 4: EX-27       Financial Data Schedule                                2      8K 

10KSB   —   Annual Report — Small Business
Document Table of Contents

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SECURITIES AND EXCHANGE COMMISSION  
WASHINGTON, D.C.  20549 

FORM 10-KSB 

[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE   
ACT OF 1934 [FEE REQUIRED]                                            

For the fiscal year ended December 31, 1994                           

OR  

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES        
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]                                

For the transition period from      to                                

Commission file number:  0-16181  

ABC BANCORP (A GEORGIA CORPORATION) 
I.R.S. EMPLOYER IDENTIFICATION NUMBER 58-1456434  
310 FIRST STREET, S.E., MOULTRIE, GEORGIA 31768 
TELEPHONE NUMBER:  (912) 890-1111 

Securities registered pursuant to Section 12(b) of the Act  

None  

Securities registered pursuant to Section 12(g) of the Act  

Common Stock, Par Value $1 Per Share  

Check 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                                                             
----    ----                                            

Check if there is no disclosure of delinquent filers pursuant to Item 405 of    
Regulation S-B is not contained herein, and will not 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 registrant's total revenues for the fiscal year ended December 31, 1994 were
$24,353,000.                                                                    

As of March 1, 1995, registrant had outstanding 2,514,575 shares of common      
stock, $1 par value per share, which is registrant's only class of common stock.
The aggregate market value of the voting stock held by nonaffiliates of the     
registrant was approximately $31,432,000.                                       

DOCUMENTS INCORPORATED BY REFERENCE 

The information required by Part III of this Annual Report is incorporated by   
reference from the Registrant's definitive proxy statement to be filed with the 
Securities and Exchange Commission pursuant to Regulation 14A not later than 120
days after the end of the fiscal year covered by this Annual Report.            

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PART I                                                                          

ITEM 1.         BUSINESS OF THE COMPANY AND SUBSIDIARY BANKS                    

            On August 21, 1981, ABC Bancorp ("ABC" or the "Company") was
organized as a registered bank holding company under the Federal Bank Holding   
Company Act of 1956, as amended, and the bank holding company laws of Georgia.  

merged with a subsidiary of ABC created for the purpose of organizing American  
Bank into a one-bank holding company structure. Since that time, American Bank  
has operated as a wholly-owned subsidiary of ABC.                               

            In 1985, ABC acquired all of the outstanding common stock of
another one-bank holding company, Quitman Bancshares, Inc., in exchange for ABC 
common stock. In connection with that acquisition, ABC acquired all of the      
outstanding common stock of The Bank of Quitman ("Quitman Bank") which was a    
wholly-owned subsidiary of Quitman Bancshares, Inc. Pursuant to terms of the    
Reorganization Agreement and the Merger Agreement, Quitman Bancshares, Inc.     
ceased to exist as a separate entity and Quitman Bank thus became a wholly-owned
subsidiary of ABC.                                                              

           On July 1, 1986, ABC acquired all of the outstanding common
stock of Bank of Thomas County ("Thomas Bank") for cash and Thomas Bank became a
wholly-owned subsidiary of ABC.                                                 

            In December 1986, ABC acquired all of the outstanding common
stock of The Citizens Bank of Tifton ("Tifton Bank") in exchange for cash and   
ABC common stock.                                                               

              On October 1, 1992, ABC acquired all of the outstanding common
stock of Cairo Banking Company ("CBC") for cash and CBC became a wholly-owned   
subsidiary of ABC.                                                              

        ABC is a bank holding company and does not engage in any
substantial business other than the normal banking services conducted by its    
five wholly-owned bank subsidiaries, which are sometimes hereinafter            
collectively referred to as the "Banks."                                        

AMERICAN BANK                                                                   

               American Bank was incorporated on August 3, 1971 and operates a
full service banking business in Moultrie, Colquitt County, Georgia, providing  
such banking services as checking and savings accounts, various other types of  
time deposits and money transfers. As of December 31, 1994, American Bank       
ranked, on the basis of total deposits, as the smallest of three banks in       
Colquitt County.                                                                

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                American Bank also finances various commercial, agricultural and
consumer transactions and makes and services both secured and unsecured loans to
individuals, firms and corporations. American Bank makes a variety of           
residential, industrial, commercial and agricultural loans secured by real      
estate, including interim construction financing. American Bank acts as agent   
for Trust Company Bank, Atlanta, Georgia in offering "MasterCard" and "VISA"    
credit cards to its customers. American Bank also offers individual trust       
services.                                                                       

     At December 31, 1994, American Bank had correspondent
relationships with eight other commercial banks in Georgia. American Bank's     
principal correspondent bank is Trust Company Bank, Atlanta, Georgia. These     
correspondent banks provide certain services to American Bank such as processing
checks and other items, buying and selling Federal funds, handling money        
transfers and exchanges, shipping coin and currency, providing security and     
safekeeping of funds or other valuable items, and furnishing limited management 
information and advice. As compensation for these services, American Bank       
maintains certain balances with its correspondents in noninterest-bearing       
accounts.                                                                       

QUITMAN BANK                                                                    

             Quitman Bank was founded on December 26, 1888, and operates a
general banking business in Quitman, Brooks County, Georgia. On December 31,    
1994, Quitman Bank ranked, on the basis of total deposits, as the largest of    
four banks in Brooks County, Georgia.                                           

        Among the services provided by Quitman Bank are checking
accounts and savings accounts, certificates of deposit and money transfers.     
Quitman Bank finances a variety of agricultural, commercial and consumer        
transactions and also makes secured and unsecured loans, including loans secured
by real estate, to individuals, firms and corporations and purchases installment
obligations from retailers without recourse. Quitman Bank does not conduct trust
activities.                                                                     

       As of December 31, 1994, Quitman Bank had correspondent
relationships with six other commercial banks. Quitman Bank's principal         
correspondent bank is Trust Company Bank, Atlanta, Georgia.                     

THOMAS BANK                                                                     

                Thomas Bank was incorporated in 1911 and operates a full service
banking business in Coolidge, Thomas County, Georgia, providing such banking    
services as checking and savings accounts, other types of time deposits and     
money transfers. As of December 31, 1994, Thomas Bank ranked, on the basis of   
total deposits, as the smallest of seven banks in Thomas County.                

               Thomas Bank also finances commercial, agricultural and consumer
transactions and makes and services both secured and unsecured loans to         
individuals, firms and corporations. Thomas Bank makes a variety of residential,
industrial, commercial and agricultural loans secured by real estate, including 
interim construction financing.                                                 

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     At December 31, 1994, Thomas Bank had a correspondent
relationship with two other commercial banks. Thomas Bank's principal           
correspondent bank is Trust Company Bank, Atlanta, Georgia. This correspondent  
bank provides certain services to Thomas Bank, such as processing checks and    
other items, buying and selling Federal funds, handling money transfers and     
exchanges, shipping coin and currency, providing security and safekeeping of    
funds or other valuable items and furnishing limited management information and 
advice. As compensation for these services, Thomas Bank maintains certain       
balances with its correspondents in noninterest-bearing accounts.               

TIFTON BANK                                                                     

                Tifton Bank was incorporated in 1945 and operates a full service
banking business in Tifton, Tift County, Georgia, providing such banking        
services as checking and savings accounts, other types of time deposits and     
money transfers. As of December 31, 1994, Tifton Bank ranked, on the basis of   
total deposits, as the fourth largest of six banks in Tift County.              

               Tifton Bank also finances commercial, agricultural and consumer
transactions and makes and services both secured and unsecured loans to         
individuals, firms and corporations. Tifton Bank makes a variety of residential,
industrial, commercial and agricultural loans secured by real estate, including 
interim construction financing. Tifton Bank acts as agent for a major Albany,   
Georgia bank in offering "VISA" credit cards to its customers.                  

   At December 31, 1994, Tifton Bank had correspondent
relationships with six other commercial banks. Tifton Bank's principal          
correspondent bank is Trust Company Bank, Atlanta, Georgia. These correspondent 
banks provide certain services to Tifton Bank, such as processing checks and    
other items, buying and selling Federal funds, handling money transfers and     
exchanges, shipping coin and currency, providing security and safekeeping of    
funds or other valuable items and furnishing limited management information and 
advice. As compensation for these services, Tifton Bank maintains certain       
balances with its correspondents in noninterest-bearing accounts.               

CAIRO BANK                                                                      

               Cairo Bank was incorporated in 1900 and operates a full service
banking business in Cairo in Grady County, Georgia and in Thomasville and Meigs 
in Thomas County, Georgia, providing such banking services as checking and      
savings accounts, other types of time deposits and money transfers. As of       
December 31, 1994, Cairo Bank ranked as the second largest of five banks in     
Grady County.                                                                   

              Cairo Bank also finances commercial, agricultural and consumer
transactions and makes and services both secured and unsecured loans to         
individuals, firms and corporations. Cairo Bank makes a variety of residential, 
industrial, commercial and agricultural loans secured by real estate, including 
interim construction financing. Cairo Bank acts as its own agent in offering    
"VISA" and "MasterCard" credit cards to its customers.                          

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                At December 31, 1994, Cairo Bank had correspondent relationships
with five other commercial banks. Cairo Bank's principal correspondent is       
Georgia Bankers Bank, Atlanta, Georgia. These correspondent banks provide       
certain services to Cairo Bank, such as processing checks and other items,      
buying and selling Federal funds, providing security and safekeeping of funds or
other valuable items and furnishing limited management information and advice.  
As compensation for these services, Cairo Bank maintains certain balances with  
its correspondents in noninterest-bearing accounts.                             

MARKET AREA AND COMPETITION                                                     

            The Company's market area is a contiguous twelve-county area
located within an approximately 60-mile radius of Moultrie in south central     
Georgia. 1-75 runs through the Company's market area, which is bordered on the  
south by the Georgia-Florida state line. The Banks have offices in Colquitt     
County, Tift County, Thomas County, Brooks County and Grady County. As reported 
by the United States Bureau of Census, this five-county area had a population in
1990 of approximately 146,000.                                                  

                ABC's twelve banking facilities are located in communities whose
economies are based primarily on agriculture, manufacturing and light industry. 
Textiles, meat processing and aluminum processing are among the leading         
manufacturing industries in the Company's market area, represented by such firms
as Riverside Manufacturing Co., Sipco, Reynolds Metal Company, Tifton           
Manufacturing, Wells Aluminum, Inc., W. B. Roddenberry, Inc., Wright's Nursery  
and Flowers, Inc.                                                               

                The banking industry in Georgia is highly competitive. In recent
years, intense market demands, economic pressures, rapidly fluctuating interest 
rates and increased customer awareness of product and service differences among 
financial institutions have forced banks to diversify their services and become 
more cost effective. Each of the Banks faces strong competition in attracting   
deposits and making loans. Their most direct competition for deposits comes from
other commercial banks, thrift institutions, credit unions and issuers of       
securities such as shares in money market funds. Interest rates, convenience of 
office locations and marketing are all significant factors in the Banks'        
competition for deposits.                                                       

               Competition for loans comes from other commercial banks, thrift
institutions, savings banks, insurance companies, consumer finance companies,   
credit unions and other institutional lenders. The Banks compete for loan       
originations through the interest rates and loan fees they charge and the       
efficiency and quality of services they provide. Competition is affected by the 
general availability of lendable funds, general and local economic conditions,  
current interest rate levels and other factors that are not readily predictable.

               Management expects that competition will become more intense in
the future due to changes in state and Federal laws and regulations and the     
entry of additional bank and nonbank competitors. See SUPERVISION AND           
REGULATION.                                                                     

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PROPERTIES                                                                      

       The table below sets forth the location, size and other
information with respect to the Company's real properties. All properties are   
owned by the Company or its subsidiaries and are unencumbered.                  

                                                        [Enlarge/Download Table]

                                                                                                    APPROXIMATE 
                                                                                                      SQUARE    
                         OFFICES                                                  USED BY            FOOTAGE    
--------------------------------------------------------------------  --------------------------  --------------
                                                                                                                
310 First Street, S.E., Moultrie                                                ABC Bancorp              7,000  
225 South Main Street, Moultrie                                                 American Bank            9,000  
1707 First Avenue, S.E., Moultrie                                               American Bank            5,500  
137 Broad Street, Doerun                                                        American Bank            3,860  
1000 West Screven Street, Quitman                                               Quitman Bank            11,530  
Eastern Brooks County                                                           Quitman Bank             1,100  
529 Pine Avenue, Coolidge                                                       Thomas Bank              4,000  
East Railroad Street, Ochlocknee                                                Thomas Bank              4,000  
113 E. Eighth Street, Tifton                                                    Tifton Bank              5,800  
Second Street at Magnolia Avenue, Tifton                                        Tifton Bank              2,000  
201 South Broad Street, Cairo                                                   Cairo Bank              10,000  
12 East Depot Street, Meigs                                                     Cairo Bank               2,700  
2242 East Pinetree Boulevard, Thomasville                                       Cairo Bank (1)           3,000  

(1)     This location will be used by Thomas Bank as of January 1, 1995.        

EMPLOYEES                                                                       

               At December 31, 1994, ABC Bancorp and its subsidiaries employed
178 full-time employees and 20 part-time employees. ABC Bancorp considers its   
relationship with its employees to be excellent.                                

              In 1989, ABC adopted a master simplified employee benefit plan
covering substantially all employees. The Company and the Banks made            
contributions for all eligible employees in 1994. ABC also maintains a          
comprehensive employee benefits program providing, among other benefits,        
hospitalization and major medical insurance and life insurance. Management      
considers these benefits to be competitive with those offered by other financial
institutions in south Georgia. The Company's employees are not represented by   
any collective bargaining group.                                                

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SUPERVISION AND REGULATION  

                Bank holding companies and banks are extensively regulated under
both Federal and state law. To the extent that the following information        
describes statutory and regulatory provisions, it is qualified in its entirety  
by reference to those particular statutory and regulatory provisions. Any change
in applicable law or regulation may have a material effect on the business and  
prospects of the Company and the Banks.                                         

THE COMPANY                                                                     

FEDERAL REGULATIONS                                                 

            The Company is subject to the provisions of the Bank Holding
Company Act of 1956, as amended (the "BHCA"), and to supervision by the Board of
Governors of the Federal Reserve System (the "FRB") thereunder. Under the BHCA, 
a bank holding company must obtain FRB approval before it acquires direct or    
indirect ownership or control of more than 5% of the outstanding shares of any  
class of voting stock of any bank or bank holding company unless it already owns
a majority of the outstanding shares of any class of voting securities of such  
bank or bank holding company. The approval of the FRB must also be obtained     
before a bank holding company acquires all or substantially all of the assets of
a bank or merges or consolidates with another bank holding company (although the
FRB may not assert jurisdiction in certain bank mergers that are regulated under
the Bank Merger Act). The FRB may not approve any acquisition, merger or        
consolidation that would result in a monopoly or would be in furtherance of any 
combination or conspiracy to monopolize or any attempt to monopolize the        
business of banking in any part of the United States, nor may the FRB approve   
any acquisition, merger or consolidation whose effect may be to substantially   
lessen competition in any section of the country, or tend to create a monopoly, 
or that would in any other manner be in restraint of trade, unless it finds that
the anti-competitive effects of the proposal are clearly outweighed in the      
public interest by the probable effect of the transaction in meeting the        
convenience and needs of the communities to be served. The FRB is prohibited,   
however, from approving the acquisition by the Company of the voting shares of, 
or substantially all the assets of, any bank located outside Georgia, unless    
such acquisition is specifically authorized by the laws of the state in which   
the bank is located. In considering any application for approval of an          
acquisition or merger, the FRB is also required to consider the financial and   
managerial resources of the companies and banks concerned, the convenience and  
needs of the communities to be served, and the applicant's record of compliance 
with the Community Reinvestment Act (the "CRA"). The CRA generally requires such
financial institution to take affirmative action to ascertain and meet the      
credit needs of its entire community, including low and moderate income         
neighborhoods. Each of the Banks has received a "satisfactory" rating based upon
their most recent examination.                                                  

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         In addition, the BHCA prohibits the FRB from approving an
application by a bank holding company to acquire a bank located outside the     
state in which the operations of the holding company's banking subsidiaries are 
principally conducted, unless such acquisition is specifically authorized by the
law of the state in which the bank to be acquired is located. However, under the
BHCA, as amended pursuant to the Financial Institutions Reform, Recovery, and   
Enforcement Act of 1989 ("FIRREA") and as implemented by FRB regulations, a bank
holding company may acquire a savings association, as defined in FIRREA, in any 
state without regard to whether the bank holding company can operate a bank in  
that state.                                                                     

            The BHCA also prohibits a bank holding company, with certain
limited exceptions, from itself engaging in or acquiring direct or indirect     
interests in or control of any company that is engaged in non-banking           
activities. Certain exemptions are available with respect to subsidiaries       
engaged in servicing or liquidating activities or companies acquired by a bank  
holding company in satisfaction of debts previously contracted. Another         
principal exception to this prohibition allows the acquisition, following an    
application or notice process, of interests in companies whose activities are   
found by the FRB, by order or regulation, to be so closely related to banking or
managing or controlling banks as to be a proper incident thereto. Some of the   
activities that have been determined by regulation to be closely related to     
banking are making or servicing loans, underwriting credit life insurance,      
performing certain data processing services, acting as an investment or         
financial advisor, and providing discount securities brokerage services. Other  
activities approved by the FRB include consumer financial counseling, tax       
planning and tax preparation, futures and options advisory services, check      
guaranty services, collection agency services, credit bureau services, and      
personal property appraisals. In determining whether a particular activity is a 
proper incident to banking or managing or controlling banks, the FRB considers  
whether its performance by an affiliate of the holding company can reasonably be
expected to produce benefits to the public, such as greater convenience,        
increased competition, or gains in efficiency, which outweigh possible adverse  
effects, such as undue concentration of resources, decreased or unfair          
competition, conflicts of interest, or unsound banking practices. The FRB is    
also empowered to differentiate between activities commenced de nova and        
activities through an acquisition of a going concern.                           

       Under Federal law, the Company and its subsidiaries are
prohibited from extending credit, selling or leasing property, and furnishing   
any service to any customer on the condition or requirement that the customer   
(i) obtain any additional property, service or credit from the Company and its  
subsidiaries; (ii) refrain from obtaining any property, service or credit from  
any competitor of the Company or its subsidiaries; or (iii) furnish any         
property, service or credit to the Company or its subsidiaries.                 

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         As a bank holding company, the Company is also subject to
certain restrictions with respect to engaging in the business of issuing,       
floating or underwriting securities, or the public sale or distribution of      
securities. In addition, the Company is required to give the FRB prior written  
notice of any purchase or redemption of its outstanding equity securities if the
gross consideration for the purchase or redemption, when combined with the net  
consideration paid for all such purchases or redemptions during the preceding 12
months, is equal to 10% or more of the Company's consolidated net worth. The FRB
may disapprove such a purchase or redemption if it determines that the proposal 
would violate any law, regulation, FRB order or directive, or any condition     
imposed by the FRB.                                                             

             The FRB has also adopted capital adequacy guidelines. See "--
Risk-Weighted Capital Requirements".                                            

             The FRB has been granted enforcement powers over bank holding
companies and nonbanking subsidiaries to forestall activities that represent    
unsafe or unsound practices or constitute violations of law. These powers may be
exercised through the issuance of cease-and-desist orders or other actions. The 
FRB is also empowered to assess civil penalties against companies or individuals
who violate the BHCA or orders or regulations thereunder in amounts up to $1    
million for each day's violation, to order termination of nonbanking activities 
of nonbanking subsidiaries of bank holding companies, and to order termination  
of ownership and control of a nonbanking subsidiary by a bank holding company.  
Certain violations may also result in criminal penalties. The FRB and the FDIC, 
as appropriate, are authorized to exercise comparable authority, under the      
Federal Deposit Insurance Act (the "FDI Act") and other statutes, with respect  
to subsidiary banks.                                                            

               As a bank holding company, the Company is required to file with
the FRB an annual report and such additional information as the FRB may require 
pursuant to the BHCA. The FRB may also examine the Company and any or all of its
subsidiaries.                                                                   

         The FRB takes the position that a bank holding company is
required to serve as a source of financial and managerial strength to its       
subsidiary banks and may not conduct its operations in an unsafe or unsound     
manner. In addition, it is the FRB's position that in serving as a source of    
strength to its subsidiary banks, a bank holding company should stand ready to  
use available resources to provide adequate capital funds to its subsidiary     
banks during periods of financial stress or adversity and should maintain the   
financial flexibility and capital-raising capacity to obtain additional         
resources for assisting its subsidiary banks. A bank holding company's failure  
to meet its obligations to serve as a source of strength to its subsidiary banks
will generally be considered by the FRB to be an unsafe and unsound banking     
practice or a violation of the FRB regulations or both.                         

              The status of the Company as a registered bank holding company
under the BHCA does not exempt it from certain Federal and state laws and       
regulations applicable to corporations generally, including, without limitation,
certain provisions of the Federal securities laws. The Company is under the     
jurisdiction of the Securities and Exchange Commission and of state securities  
commissions for matters relating to offers and sales of its securities.         

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STATE REGULATIONS                                               

               The Company is also subject to the Georgia Bank Holding Company
Act ("GBHCA") enacted by the State of Georgia and examination thereunder by the 
Commissioner of the Department of Banking and Finance of the State of Georgia   
(the "Georgia Commissioner"). The GBHCA provides that, without the prior        
approval of the Georgia Commissioner, it is unlawful (i) for any bank holding   
company to acquire direct or indirect ownership or control of more than 5% of   
the voting shares of any bank, (ii) for any bank holding company or subsidiary  
thereof, other than a bank, to acquire all or substantially all of the assets of
a bank, or (iii) for any bank holding company to merge or consolidate with any  
other bank holding company. It is unlawful for any bank holding company to      
acquire direct or indirect ownership or control of more than 5% of the voting   
shares of any bank unless such bank has been in existence and continuously      
operating as a bank for a period of five years or more prior to the date of the 
application to the Georgia Commissioner seeking approval for such acquisition.  

          In addition, the acquisition of any additional banks would
require prior approval from both the FRB and the Georgia Commissioner. Under    
Georgia law, a bank holding company is authorized to acquire ownership or       
control of additional banks in Georgia, Alabama, District of Columbia, Florida, 
Kentucky, Louisiana, Maryland, Mississippi, North Carolina, South Carolina,     
Tennessee and Virginia (collectively, the "Southeastern Compact"), provided such
states enact reciprocal legislation. As of December 31, 1993, reciprocal        
legislation was in effect in all of the aforementioned states. North Carolina   
and Tennessee, however, have recently enacted legislation which will remove such
states from the Southeastern Compact and will permit national interstate        
acquisitions by institutions located in North Carolina and Tennessee in states  
which also permit national interstate acquisitions. On March 16, 1994, the      
Georgia Legislature adopted a bill containing similar provisions. Assuming this 
legislation (the "Georgia Interstate Banking Act") is signed into law by the    
Governor of the State of Georgia, effective July 1, 1995, Georgia will no longer
be a member of the Southeastern Compact. Instead, (a) interstate acquisitions by
institutions located in Georgia will be permitted in states which also allow    
national interstate acquistions, and (b) interstate acquisitions of institutions
located in Georgia will be permitted by institutions located in states which    
also allow national interstate acquisitions; provided, however, that if the     
board of directors of a Georgia bank or bank holding company adopts a resolution
to except such bank or bank holding company from being acquired pursuant to the 
provisions of the Georgia Interstate Banking Act and properly files a certified 
copy of such relolution with the Georgia Commissioner, such Georgia bank or bank
holding company may not be acquired by an institution located outside of the    
State of Georgia. The Company does not presently intend to except the Company or
any of the Banks from the provisions of the Georgia Interstate Banking Act. It  
is uncertain at this point whether Federal legislation will be required to allow
the withdrawal of these states from the Southeastern Compact to become          
effective.                                                                      

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SUBSIDIARY BANKS                                                                

        Federal banking regulations applicable to all depository
financial institutions, among other things, (i) provide Federal bank regulatory 
agencies with powers to prevent unsafe and unsound banking practices; (ii)      
restrict preferential loans by banks to "insiders" of banks; (iii) require banks
to keep information on loans to major shareholders and executive officers; and  
(iv) bar certain director and other interlocks between financial institutions.  

                The Company is an "affiliate" of its banking subsidiaries within
the meaning of the Federal Reserve Act, which imposes restrictions on loans to  
the Company by the Banks, or investments by the Banks in securities of the      
Company and on the use of such securities as collateral security for loans by   
the Banks to any borrower. The Company is also subject to certain restrictions  
with respect to engaging in the business of issuing, underwriting and           
distributing securities.                                                        

          Bank holding companies may be compelled by bank regulatory
authorities to invest additional capital in the event their banks experience    
either significant loan losses or rapid growth of loans or deposits. In         
addition, the Company may also be required to provide additional capital to any 
additional banks it acquires as a condition to obtaining the approvals and      
consents of regulatory authorities in connection with such acquisition.         

         The Banks are examined and regulated by the Department of
Banking and Finance of the State of Georgia (the "Department"). Pursuant to     
regulations adopted by the Department, the Banks must each have the approval of 
the Georgia Commissioner to pay cash dividends, unless at the time of such      
payment (i) the total classified assets at the most recent examination of such  
Bank do not exceed 80% of the equity capital as reflected by such examination;  
(ii) the aggregate amount of dividends declared or anticipated to be declared in
the calendar year does not exceed 50% of the net profits, after taxes but before
dividends, for the previous calendar year; and (iii) the ratio of equity capital
to adjusted total assets is not less than 6%.                                   

              The Banks are members of the FDIC, which currently insures the
deposits of each member bank to a maximum of $100,000 per depositor. For this   
protection, each Bank pays a semi-annual statutory assessment and is subject to 
the rules and regulations of the FDIC. The FDIC has the authority to prevent the
continuance or development of unsound and unsafe banking practices. The FDIC is 
also authorized to approve conversions, mergers, consolidations and assumption  
of deposit liability transactions between insured banks and uninsured banks or  
institutions, and to prevent capital or surplus diminution in such transactions 
where the resulting, continuing or assumed bank is an insured nonmember state   
bank.                                                                           

           The FDIC has issued regulations that require the subsidiary
banks to maintain minimum levels of capital. These regulations are similar to   
those adopted by the FRB for bank holding companies described under "--Risk-    
Weighted Capital Requirements."                                                 

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                The appropriate bank regulatory authorities may impose sanctions
on any bank that does not operate in accordance with their regulations, policies
and directives. Proceedings may be instituted against any bank or any director, 
officer, employee or other institution-affiliated party of the bank that is     
believed by the appropriate supervisors to be engaged in unsafe and unsound     
practices, including the violation of applicable laws and regulations. These    
authorities are also empowered to assess civil penalties against companies or   
individuals who violate certain Federal statutes, orders or regulations in      
amounts up to $1 million for each day's violations. In addition, the FDIC has   
the authority to terminate insurance of accounts, after notice and hearing, upon
a finding by the FDIC that the insured institution is or has engaged in any     
unsafe or unsound practice that has not been corrected, or is in an unsafe and  
unsound condition to continue operations, or has violated any applicable law,   
regulation, rule or order of, or condition imposed by, the appropriate          
supervisors.                                                                    

           The FRB requires all depository institutions, including the
subsidiary banks, to maintain reserves against their checking and transaction   
accounts (primarily checking, NOW and Super NOW checking accounts). Because     
reserves must generally be maintained in cash or in noninterest-bearing         
accounts, the effect of the reserve requirements is to increase the subsidiary  
banks' cost of funds.                                                           

              FIRREA provides that an insured depository institution will be
liable for any loss incurred by the FDIC, or any loss to the FDIC reasonably    
anticipated after August 8, 1989, in connection with the default of a commonly  
controlled insured depository institution or in connection with assistance      
provided to such an institution which is in danger of default. Banks that share 
the same holding company are considered commonly controlled depository          
institutions. The FDIC has the ability to exempt depository institutions from   
this provision in certain circumstances.                                        

RISK-WEIGHTED CAPITAL REQUIREMENTS                                              

              After December 31, 1992, banking organizations (including both
holding companies and banks) were required to meet a minimum ratio of Total     
Capital to Total Risk-Weighted Assets of 8%, of which at least 4% must be in the
form of Tier 1 Capital.                                                         

         The following table reflects the Company's and the Banks'
compliance with regulatory capital requirements at December 31, 1994 on a       
consolidated basis:                                                             

                                                        [Enlarge/Download Table]

                               ACTUAL                        REQUIRED                       EXCESS         
                     --------------------------     --------------------------     ------------------------

                        AMOUNT        PERCENT         AMOUNT          PERCENT        AMOUNT        PERCENT 
                     --------------------------     --------------------------     ------------------------

                                                      (Dollars in Thousands)                               
                     --------------------------------------------------------------------------------------

                                                                                                           
Leverage capital     $   29,808       10.26 %       $   11,619        4.00 %       $   18,189      6.26  % 

Risk-based capital:                                                                                        
   Core capital          29,808       15.26              7,814        4.00             21,994     11.26    
   Total capital         32,266       16.52             15,627        8.00             16,639      8.52    


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    Each Bank also met its individual regulatory capital
requirements at December 31, 1994.                                              

             A banking organization's qualifying total capital consists of
two components: Tier 1 Capital (core capital) and Tier 2 Capital (supplementary 
capital). Tier 1 Capital is an amount equal to the sum of: (i) common           
shareholders' equity (including adjustments for any surplus or deficit); (ii)   
qualifying noncumulative perpetual preferred stock (plus, for bank holding      
companies, qualifying cumulative perpetual preferred stock in an amount up to   
25% of Tier 1 Capital); and (iii) the minority interests in the equity accounts 
of consolidated subsidiaries.                                                   

               Intangible assets (other than goodwill) may be included in Tier
1 Capital for bank holding companies to an extent banking examiners consider    
appropriate with the following factors, among others, taken into consideration: 
(i) the reliability and predictability of any cash flows associated with the    
asset and the degree of certainty that can be achieved in periodically          
determining the asset's useful life and value; (ii) the existence of an active  
and liquid market for the asset; and (iii) the feasibility of selling the asset 
apart from the banking organization or from the bulk of its assets. At least 50%
of the banking organization's total regulatory capital must consist of Tier 1   
Capital.                                                                        

       Tier 2 Capital is an amount equal to the sum of (i) the
allowance for possible loan and lease losses in an amount up to 1.25% of risk-  
weighted assets, (ii) cumulative perpetual preferred stock and long-term        
preferred stock (which for bank holding companies must have an original maturity
of 20 years or more) and related surplus; (iii) hybrid instruments (instruments 
with characteristics of both debt and equity), perpetual debt and mandatory     
convertible debt securities; and (iv) eligible term subordinated debt and       
intermediate-term preferred stock with an original maturity of five years or    
more, including related surplus, in an amount up to 50% of Tier 1 Capital. The  
inclusion of the foregoing elements of Tier 2 Capital are subject to certain    
further requirements and limitations of the Federal bank regulatory agencies.   

               Investments in unconsolidated banking and finance subsidiaries,
investments in securities subsidiaries and reciprocal holdings of capital       
instruments must be deducted from capital. The Federal banking regulators may   
require other deductions on a case-by-case basis.                               

                Under the risk-weighted capital guidelines, balance sheet assets
and certain off-balance sheet items, such as standby letters of credit, are     
assigned to one of four risk weight categories (0%, 20%, 50% or 100%) according 
to the nature of the asset and its collateral or the identity of any obligor or 
guarantor. For example, cash is assigned to the 0% risk category, while loans   
secured by one-to-four family residences are assigned to the 50% risk category. 
The aggregate amount of such assets and off-balance sheet items in each risk    
category is adjusted by the risk weight assigned to that category to determine  
weighted values, which are added together to determine the total risk-weighted  
assets for the banking organization. Accordingly, an asset such as a commercial 
loan, which is assigned to a 100% risk category, is included in risk-weighted   
assets at its nominal face value, whereas a loan secured by a single-family home
mortgage is included at only 50% of its nominal face value. The applicable      
ratios reflect capital, as determined, divided by risk-weighted assets, as      
determined.                                                                     

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              The FRB recently amended its capital rules to clarify that (i)
supervisory goodwill arising from acquisitions in the future will not be        
considered as capital for the risk-based capital purposes; (ii) FRB approval is 
required before a bank holding company may redeem its perpetual preferred stock,
and (iii) bank holding companies selling residential mortgages with recourse    
must hold capital against those assets and incorporate the sales in their risk- 
based capital calculations, unless the maximum loss under the recourse          
arrangement is less than the estimated loss on the assets and the company has   
adequate reserves to cover the estimated loss. A phase-in period applies to     
asset sales with recourse prior to October 12, 1990. The rule also provides that
claims on central banks which are not members of the Organization for Economic  
Cooperation and Development (the "OECD") and claims on governments which are not
OECD members should be assigned to the 100% risk category.                      

POTENTIAL ENFORCEMENT ACTION FOR BANK HOLDING COMPANIES AND BANKS               

            Bank holding companies and banks may be subject to potential
enforcement actions by the FRB and/or the FDIC for unsafe or unsound practices  
in conducting their businesses, or for violations of any law, rule or           
regulation, any cease-and-desist or consent order, any condition imposed in     
writing by the agency or any written agreement with the agency. Enforcement     
actions may include the imposition of a conservator or receiver, cease-and-     
desist orders and written agreements, the termination of insurance of deposits, 
the imposition of civil money penalties and removal and prohibition orders      
against institution-affiliated parties.                                         

            FIRREA significantly expanded the enforcement powers of bank
regulatory agencies, increased the penalties for violations of law and          
substantially revised and codified the powers of receivers and conservators of  
depository institutions. These powers include the power to obtain cease and     
desist orders, the power to remove officers and directors, the power to approve 
all new directors and senior executive officers of certain depository           
institutions, and the power to assess criminal and civil money penalties for    
violations of law or regulations, or conditions imposed by, or agreements with, 
a regulatory agency. The receivership and conservatorship provisions of FIRREA  
include a statutory claims procedure and provisions which expand and confirm the
powers of the FDIC to obtain a stay of pending litigation and to repudiate      
certain contracts or leases it deems burdensome, in order to promote the orderly
administration of the institution's affairs and to set aside preferential       
transfers. Under Section 914 of FIRREA and regulations adopted by the FRB and   
FDIC, the FRB or FDIC, as appropriate, must be given, under certain             
circumstances, 30 days notice of any changes in directors or senior executive   
officers of the Company and the Banks, respectively. The FRB and FDIC may       
disapprove such changes.                                                        

 The Crime Control Act of 1990, enacted on November 29, 1990, also
contains a number of provisions which further enhance the enforcement powers of 
the Federal banking regulators, expand the scope of persons potentially subject 
to enforcement actions and increase the penalties for violations of law.        

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RECENT LEGISLATIVE AND REGULATORY DEVELOPMENTS FOR BANK HOLDING COMPANIES AND   
BANKS                                                                           

INSURANCE PREMIUMS                                              

         The Federal Deposit Insurance Corporation Improvement Act
("FDICIA"), enacted on December 19, 1991, in connection with the                
recapitalization of the Bank Insurance Fund ("BIF"), requires the FDIC to set   
semi-annual assessment rates for BIF members at levels sufficient to increase   
the BIF's reserve ratio to a designated level within a prescribed period of     
time, not to exceed 15 years from the date that the FDIC promulgates the        
applicable time schedule. In addition, FDICIA directed the FDIC to develop and  
implement a system of risk-based premiums for Federal deposit insurance pursuant
to which the semi-annual rates will be assessed on the depository institution   
based on the probability that the depository insurance fund will incur a loss   
with respect to the institution.                                                

           In addition to authorizing an increase in the BIF insurance
assessment rates, FDICIA also authorizes one or more "special assessments"      
necessary (i) to repay funds borrowed from the Secretary of the Treasury        
pursuant to Section 14(a) of the FDI Act, (ii) to repay obligations issued to or
borrowed from the BIF and Savings Association Insurance Fund ("SAIF"), and (iii)
for any other purpose the FDIC deems necessary. A significant increase in the   
assessment rate or an additional special assessment could have an adverse impact
on the financial condition of the Company and the Banks.                        

             Each insured depository institution is also to be assigned to
one of the following "supervisory subgroups" --Subgroup A, B or C. Subgroup A   
institutions are financially sound institutions with few minor weaknesses;      
Subgroup B institutions are institutions that demonstrate weaknesses which, if  
not corrected, could result in significant deterioration; and Subgroup C        
institutions are institutions for which there is a substantial probability that 
the FDIC will suffer a loss in connection with the institution unless effective 
action is taken to correct the areas of weakness. Based on its capital and      
supervisory subgroups, each BIF or SAIF member institution will be assigned an  
annual FDIC assessment rate varying between .23% per annum (for well capitalized
Subgroup A institutions) and .31% per annum (for undercapitalized Subgroup C    
institutions). Pursuant to these regulations, the deposit insurance rate for    
each of the Banks (except Cairo Bank) has been established at .23% of domestic  
deposits. The deposit insurance rate for Cairo Bank has been decreased from .29%
to .26%. Management believes that the continued improvement in Cairo Bank's     
asset quality will result in a further decrease in the assessment rate.         

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PROMPT CORRECTIVE ACTION                                        

              FDICIA substantially revised the bank regulatory provisions of
the FDI Act and several other Federal banking statutes. Among other things,     
FDICIA requires Federal banking agencies to broaden the scope of regulatory     
corrective action taken with respect to depository institutions that do not meet
minimum capital and related requirements and to take such actions promptly in   
order to minimize losses to the FDIC. These provisions generally became         
effective on December 19, 1992. In connection with FDICIA, Federal banking      
agencies are required to establish capital measures (including both a leverage  
measure and a risk-based capital measure) and to specify for each capital       
measure the levels at which depository institutions will be considered well     
capitalized, adequately capitalized, undercapitalized, significantly            
undercapitalized or critically undercapitalized.                                

                Under FDICIA, a depository institution will be deemed to be well
capitalized if it significantly exceeds the minimum level required by regulation
for each relevant capital measure, adequately capitalized if it meets each such 
measure, undercapitalized if it fails to meet any such measure, significantly   
undercapitalized if it is significantly below any such measure and critically   
undercapitalized if it fails to meet any critical capital level set forth in    
regulations. The critical capital level must be a level of tangible equity that 
is (i) not less than 2% of total assets and (ii) not more than 65% of the       
minimum leverage ratio to be prescribed by regulation, provided that this second
requirement does not fall below 2% of total assets.                             

               Pursuant to FDICIA, the Federal banking agencies, including the
FRB and the FDIC, have adopted regulations establishing relevant capital        
measures and relevant capital levels. The relevant capital measures are the     
total risk-based capital ratio, Tier 1 risk-based capital ratio and the leverage
ratio. Under the regulations, a bank is (i) well capitalized if it has a total  
risk-based capital ratio of 10% or greater, a Tier 1 risk-based capital ratio of
8% or greater and a leverage ratio of 5% or greater and is not subject to any   
order, written agreement, capital directive or prompt corrective action         
directive to meet and maintain a specific capital level for any capital measure:
(ii) adequately capitalized if it has a total risk-based ratio of 8% or greater,
a Tier 1 risk-based capital ratio of 4% or greater, a leverage ratio of 4% or   
greater (3% or greater if the bank is rated composite 1 in its most recent      
report of examination and is not experiencing or anticipating significant       
growth), and does not meet the definition of a well capitalized bank; (iii)     
undercapitalized if it has a total risk-based capital ratio of less than 8%, a  
Tier 1 risk-based capital ratio of less than 4% or a leverage ratio of less than
4% (or a leverage ratio of less than 3% if the institution is rated composite 1 
in its most recent report of examination and is not experiencing or anticipating
significant growth); (iv) significantly undercapitalized if it has a total risk-
based capital ratio of less than 6%, a Tier 1 risk-based capital ratio of less  
than 3% or a leverage ratio of less than 3%; and (v) critically undercapitalized
if the bank has a ratio of tangible equity to total assets that is equal to or  
less than 2%.                                                                   

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           FDICIA authorizes the appropriate Federal banking agency to
treat a well capitalized, adequately capitalized or undercapitalized insured    
depository institution as if it were in the next lower capital-based            
classification if, after notice and an opportunity for a hearing, it is found   
that such institution is in an unsafe or unsound condition or engaging in an    
unsafe or unsound practice. Thus, an adequately capitalized institution can be  
subjected to the restrictions applicable to undecapitalized institutions        
described below (provided that a capital restoration plan cannot be required of 
the institution), and an undercapitalized institution can be subjected to the   
restrictions applicable to significantly undercapitalized institutions described
below. However, the regulations provide that a significantly undercapitalized   
bank may not be reclassified as a critically undercapitalized bank.             

            An institution generally is required to submit an acceptable
capital restoration plan to its appropriate Federal banking agency within 45    
days of the date the institution receives notice or is deemed to have notice    
that it is undercapitalized, significantly undercapitalized or critically       
undercapitalized. The plan must specify (i) the steps the institution will take 
to become adequately capitalized, (ii) the capital levels to be attained each   
year, (iii) how the institution will comply with any regulatory sanctions then  
in effect against the institution, (iv) the types and levels of activities in   
which the institution will engage, and (v) such other information as the banking
agency may require.                                                             

            The banking agency may not accept a capital restoration plan
unless the agency determines, among other things, that the plan "is based on    
realistic assumptions, and is likely to succeed in restoring the institution's  
capital" and "would not appreciably increase the risk to which the institution  
is exposed." In addition, before accepting a capital restoration plan of an     
undercapitalized institution, the agency must determine that each company having
control of the institution has guaranteed that the institution will comply with 
such a capital restoration plan. Liability with respect to this guaranty is     
limited to the lesser of (i) 5% of the institution's assets at the time when it 
becomes undercapitalized and (ii) the amount necessary to restore the relevant  
capital measures of the institution that would enable the institution to be     
classified as adequately capitalized.                                           

             Under FDICIA, an insured depository institution cannot make a
capital distribution (defined to include, among other things, dividends of cash 
or other property, redemptions and other repurchases of stock, and any          
transaction deemed by the appropriate Federal banking agency or the FDIC to be  
in substance a distribution of capital), or pay management fees to any person   
that controls the institution, if thereafter it would be undercapitalized. The  
appropriate Federal banking agency, however, may (after consultation with the   
FDIC) permit an insured depository institution to repurchase, redeem, retire or 
otherwise acquire its shares if such action (i) is taken in connection with the 
issuance of additional shares or obligations in at least an equivalent amount   
and (ii) will reduce the institution's financial obligations or otherwise       
improve its financial condition.                                                

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            An undercapitalized institution is also generally prohibited
from increasing its average total assets unless its capital restoration plan has
been accepted, the increase is consistent with that plan, and the institution's 
ratio of tangible equity to assets increases during the calendar quarter at a   
rate sufficient to enable the institution to become adequately capitalized      
within a reasonable time. In addition, an undercapitalized institution is       
generally prohibited from making any acquisitions, establishing any branches or 
engaging in any new line of business except in accordance with an accepted      
capital restoration plan or with the approval of the FDIC. Furthermore, the     
appropriate Federal banking agency is given authority with respect to the       
undercapitalized depository institution to take any of the actions it is        
required to or may take with respect to a significantly undercapitalized        
institution as described below if it determines "that those actions are         
necessary to carry out the purpose" of FDICIA.                                  

           FDICIA provides that, with respect to an insured depository
institution that is significantly undecapitalized or is undercapitalized and    
either fails to submit an acceptable capital restoration plan within the time   
period allowed by regulation or fails in any material respect to implement a    
capital restoration plan accepted by the appropriate Federal banking agency, the
appropriate Federal banking agency must require such institution to take one or 
more of the following actions: (i) sell enough shares, including voting shares, 
to become adequately capitalized; (ii) merge with (or be sold to) another       
institution (or holding company), but only if grounds exist for appointing a    
conservator or receiver; (iii) restrict certain transactions with banking       
affiliates as if the "sister bank" exception to the requirements of Section 23A 
of the Federal Reserve Act did not exist; (iv) otherwise restrict transactions  
with bank or nonbank affiliates; (v) restrict interest rates that the           
institution pays on deposits to "prevailing rates" in the institution's         
"region", (vi) restrict asset growth or reduce total assets; (vii) alter, reduce
or terminate activities; (viii) hold a new election of directors; (ix) dismiss  
any director or senior executive officer who held office for more than 180 days 
immediately before the institution became undercapitalized, provided that in    
requiring dismissal of a director or senior executive officer, the agency must  
comply with certain procedural requirements, including the opportunity for an   
appeal in which the director or officer will have the burden of proving that his
or her continued employment would materially strengthen the institution's       
ability to become adequately capitalized and/or to correct an unsafe or unsound 
condition or practice; (x) employ 'qualified" senior executive officers; (xi)   
cease accepting deposits from correspondent depository institutions; (xii)      
divest certain nondepository affiliates which pose a danger to the institution; 
(xiii) be divested by a parent holding company; and (xiv) take any action which 
the agency determines would better carry out the purposes of the prompt         
corrective action provisions.                                                   

         In addition to the foregoing sanctions, without the prior
written approval of the appropriate Federal banking agency, a significantly     
undercapitalized institution may not pay any bonus to any senior executive      
officer or increase the rate of compensation for such an officer. Furthermore,  
the appropriate Federal banking agency cannot approve any such bonus in the case
of an undercapitalized institution that has failed to submit or implement an    
acceptable capital restoration plan.                                            

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           Critically undercapitalized institutions are subject to the
restrictions imposed on significantly undercapitalized institutions. In         
addition, FDICIA generally restricts payments of subordinated debt and requires 
the appropriate Federal banking agency within certain time periods to appoint a 
receiver or a conservator for such institutions unless certain statutory        
criteria are met. The FDIC is also required, by regulation or order, to         
"restrict the activities" of such critically undercapitalized institutions.     

         Based on regulatory guidelines, all of the Banks are well
capitalized.                                                                    

BROKERED DEPOSITS                                               

               FDICIA amended the FDI Act to provide generally that an insured
depository institution that is not well capitalized may not accept, renew or    
roll over brokered deposits. The FDIC may waive this restriction under certain  
circumstances if an institution is adequately capitalized or if the institution 
is under FDIC conservatorship. However, FDICIA and implementing regulations     
limit the interest rates that may be paid by such institutions on brokered      
deposits. In addition, the FDIC in general may not provide "pass-through"       
deposit insurance on certain employee benefit accounts accepted by a bank, which
at the time such accounts are accepted, may not receive brokered deposits. None 
of the Banks accept brokered deposits at this time.                             

SAFETY AND SOUNDNESS STANDARDS                                  

            Pursuant to FDICIA, the FDIC has recently adopted safety and
soundness regulations for depository institutions and depository institution    
holding companies relating to operations and management, asset quality,         
earnings, stock valuation and compensation. A holding company or institution    
that fails to comply with such regulations will be required to submit a plan    
designed to achieve such compliance. If no such plan is submitted or there is a 
failure to implement such a plan, the depository institution or holding company 
would become subject to additional regulatory action or enforcement proceedings.

MISCELLANEOUS                                                   

           FDICIA also contains a variety of other provisions that may
affect the operations of the Company and the Banks, including certain reporting 
requirements, revised regulatory standards for real estate lending, "truth in   
savings" provisions and the requirement that a depository institution give 90   
days prior notice to customers and regulatory authorities before closing any    
branch.                                                                         

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RECENTLY ADOPTED REGULATIONS                                    

             The FDIC adopted revisions effective March 1, 1993, for state
chartered nonmember banks to its risk-weighted capital guidelines that would    
change the manner in which intangible assets may be included in (i.e., not      
deducted from) the Tier 1 Capital calculation for risk-weighted and leverage    
capital purposes. Under the proposal, purchased mortgage servicing rights       
("PMSRs"), which represent anticipated fee revenue to be earned by collecting   
principal and interest payments on mortgage loans originated by another entity  
and distributing the proceeds to the mortgagee, and purchased credit-card       
relationships ("PCCRs"), which represent interest and fees anticipated in       
connection with the servicing of credit card arrangements originated by, and    
purchased from, another entity, are to be included in Tier 1 Capital to the     
extent that, in the aggregate, they do not exceed 50% of Tier 1 Capital and to  
the further extent that PCCRs alone do not exceed 25% of Tier 1 Capital. The FRB
has recently adopted regulations for bank holding companies. Such percentages   
are to be calculated after deducting goodwill and nonqualifying identifiable    
intangible assets from Tier 1 Capital. Other identifiable intangible assets,    
including core deposit intangibles ("CDIs"), which represent the value of       
relatively low-cost funding anticipated from core depositor relationships       
acquired from another entity, are proposed to be excluded from Tier 1 Capital.  
The FDIC adopted these revisions because it considers identifiable intangible   
assets, with the qualified exception of PMSRs and PCCRs, to be inherently       
unreliable and unpredictable, not traded in an active and liquid market, not    
salable apart from the financial institution itself or from the bulk of its     
assets and, particularly in the case of CDIs, analogous to goodwill.            

                Under FIRREA, the FDIC is authorized to prescribe regulations to
prevent depository institutions from contracting for goods, products or services
in a manner that would adversely affect the safety or soundness of the          
institution. A proposed regulation of the FDIC would prohibit certain "adverse  
contracts" with unrelated third parties and would establish a rebuttable        
presumption that certain contracts with related parties, including contracts for
loan processing or servicing, bookkeeping and data processing and management    
services, are adverse.                                                          

               It is uncertain which of the proposed regulations, if any, will
become final or, if so, in what form. In addition, the impact of any such       
regulations, if adopted, cannot be predicted at this time.                      

PROPOSED LEGISLATION FOR BANK HOLDING COMPANIES AND BANKS                       

          Certain proposals affecting the banking industry have been
discussed from time to time. Such proposals include: limitations on investments 
that an institution may make with insured funds; regulation of all insured      
depository institutions by a single regulator; limitations on the number of     
accounts protected by the Federal deposit insurance funds; reduction of the     
$100,000 coverage limit on deposits; changes in the nature, timing and extent of
the Federal government regulations of student loans and imposition of           
responsibility on bank holding companies for losses of insured affiliates and   
subsidiaries. It is uncertain which, if any, of the above proposals may become  
law and what effect, if any, they would have on the Company and the Banks.      

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EXECUTIVE OFFICERS                                                              

               The following table sets forth certain information with respect
to the executive officers of the Company.                                       

                                                        [Enlarge/Download Table]


     NAME, AGE AND TERM          POSITION WITH THE      PRINCIPAL OCCUPATION FOR THE LAST FIVE   
        AS OFFICER                  REGISTRANT               YEARS AND OTHER DIRECTORSHIPS       
-----------------------------  ---------------------    -----------------------------------------
                                                                                                 
Eugene M. Vereen, Jr.;         Chairman                 Chairmain of the Board of ABC            
 74; Officer since 1981                                 Bancorp since 1981 and Chief             
                                                        Executive Officer from 1981 to 1994.     
                                                        Mr. Vereen is also a Director of each    
                                                        of the Company's subsidiary banks.       
                                                        Mr. Vereen is President of M.I.A. Co.,   
                                                        a real estate holding and investment     
                                                        company and previously served            
                                                        as Senior President of American Bank.    
                                                        He now serves as President Emeritus      
                                                        of American Bank.                        

Kenneth J. Hunnicutt;          President,               Chief Executive Officer and of ABC       
 58; Officer since 1981        Chief Executive Officer  Bancorp since 1994 and President         
                               Director                 sicne 1981. Mr. Hunnicutt served as      
                                                        Senior President of American Bank        
                                                        from 1989 to 1991 and as President       
                                                        of American Bank from 1975 to 1989       
                                                        and currently serves as a Director of    
                                                        each of the  Company's subsidiary        
                                                        banks. Mr. Hunnicutt is the Chairman     
                                                        of the Board of Thomas Bank and Cairo    
                                                        Bank.                                    

W. Edwin Lane, Jr;             Executive Vice           Executive Vice President and Chief       
 41: Officer since             President and Chief      Financial Officer of ABC Bancorp since   
 January 1, 1995               Financial Officer        January 1, 1995.  Mr. Lane served as     
                                                        Controller of First Liberty Bank,        
                                                        Macon, Georgia from August 1992 to       
                                                        December 1994.  Mr. Lane was             
                                                        associated with Mauldin & Jenkins,       
                                                        Certified Public Accountants, from       
                                                        1985 to 1992, where he served as an      
                                                        audit manager from 1989 to 1992.         

           Officers serve at the discretion of the Board of Directors.

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ITEM 2.         PROPERTIES                                                      

      The principal properties of the Company consist of the
properties of the Banks. For a description of the properties of the Banks, see  
"Item 1 - Business of the Company and Subsidiary Banks - Properties" included   
elsewhere in this Annual Report.                                                

ITEM 3.         LEGAL PROCEEDINGS                                               

              Neither the Company nor any of its subsidiary banks is a party
to, nor is any of their property the subject of, any material pending legal     
proceedings, other than ordinary routine proceedings incidental to the business 
of the Banks, nor to the knowledge of the management of the Company are any such
proceedings contemplated or threatened against it or its subsidiaries.          

ITEM 4.         SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS                 

    No matters were submitted to a vote of the Company's
shareholders during the fourth quarter of 1994.                                 

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PART II 

ITEM 5.         MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED            
SECURITY  HOLDER MATTERS                        

(a)     In May 1994, the Company sold 747,500 shares of the Company's common    
        stock, par value $1.00 per share at a price of $12.25 per share pursuant
       to a registered public offering (the "Offering"). Simultaneous with the
 Offering, the common stock was approved for listing on the Nasdaq
National Market System ("Nasdaq - NMS") under the symbol ABCB.  

        Prior to the Offering, quotations for the common stock were not reported
     on any market, and there was no established public trading market for
the common stock.                                               

       The following table sets forth: (a) the high and low bid prices for the
        common stock as quoted on Nasdaq-NMS during the periods since the common
       stock was listed; and (b) the amount of quarterly dividends declared on
the common stock during the periods indicated.                  

                                                                [Download Table]

                                                                       Cash
      Calendar Period                    Bid Prices             Dividends  
----------------------------   ----------------------------                
           1994                     Low             High         Declared  
----------------------------   -------------  -------------     -----------
                                                                           
Second quarter                $    12.25     $    13.75      $     0.095   
Third quarter                      12.75          14.00            0.095   
Fourth quarter                     12.00          13.75            0.095   

(b)     As of March 1, 1995, there were approximately 800 holders of record of  
the Common Stock.                                               

(c)     The Company paid an annual dividend on its Common Stock of $.38 per     
share for fiscal years 1994 and 1993.                           

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ITEM 6.         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
RESULTS OF OPERATIONS                           

LIQUIDITY AND CAPITAL RESOURCES                                                 

           Liquidity management involves the matching of the cash flow
requirements of customers who may be either depositors desiring to withdraw     
funds or borrowers needing assurance that sufficient funds will be available to 
meet their credit needs and the ability of the Company and the Banks to meet    
those needs. The Company and the Banks seek to meet liquidity requirements      
primarily through management of short-term investments (principally Federal     
funds sold) and monthly amortizing loans. Another source of liquidity is the    
repayment of maturing single payment loans. Also, the Banks maintain            
relationships with correspondent banks which could provide funds to them on     
short notice, if needed.                                                        

                The liquidity and capital resources of the Company and the Banks
are monitored on a periodic basis by state and Federal regulatory authorities.  
As determined under guidelines established by these regulatory authorities, the 
Banks' liquidity ratios at December 31, 1994 were considered satisfactory. At   
that date, the Banks' short-term investments were adequate to cover any         
reasonably anticipated immediate need for funds. The Company and the Banks were 
aware of no events or trends likely to result in a material change in their     
liquidity. At December 31, 1994, the Company's and the Banks' capital asset     
ratios were considered adequate based on guidelines established by regulatory   
authorities. During 1994, the Company increased its capital by $8,324,000,      
representing net proceeds after deducting stock issue costs from a public       
offering of its common stock. It also increased its capital by retaining net    
earnings of $ 2,216,000 after payment of dividends. After recording a reduction 
in capital of $49,000 for unrealized losses on securities, net of taxes, total  
capital increased during 1994 by $10,491,000. At December 31, 1994, total       
capital of the Company amounted to $30,450,000. At December 31, 1994, there were
no outstanding commitments for any major capital expenditures.                  

RESULTS OF OPERATIONS                                                           

         The Company's results of operations are determined by its
ability to effectively manage interest income and expense, to minimize loan and 
investment losses, to generate noninterest income and to control noninterest    
expense. Since interest rates are determined by market forces and economic      
conditions beyond the control of the Company, the ability to generate net       
interest income is dependent upon the Banks' ability to obtain an adequate      
spread between the rate earned on interest-earning assets and the rate paid on  
interest-bearing liabilities. Thus, the key performance measure for net interest
income is the interest margin or net yield, which is taxable-equivalent net     
interest income divided by average earning assets.                              

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RESULTS OF OPERATIONS (CONTINUED)                                               

              The primary component of concolidated earnings is net interest
income, or the difference between interest income on interest-earning assets and
interest paid on interest-bearing liabilities. The net interest margin is net   
interest income expressed as a percentage of average interest-earning assets.   
Interest-earning assets consist of loans, investment securities and Federal     
funds sold. Interest-bearing liabilities consist of deposits, of which          
approximately 16% are noninterest-bearing. A portion of interest income is      
earned on tax-exempt investments, such as state and municipal bonds. In an      
effort to state this tax-exempt income and its resultant yields on a basis      
comparable to all other taxable investments, an adjustment is made to analyze   
this income on a taxable-equivalent basis.                                      

              The net interest margin increased by 5.24% to 5.62% in 1994 as
compared to 5.34% in 1993. This increase in net interest margin was achieved by 
an increase of 10 basis points on average yield earned on interest-earning      
assets accompanied by a decrease of 6 basis points in average rate paid on      
interest-bearing liabilities. Net interest income on a taxable-equivalent basis 
was $13,814,000 in 1994 as compared to $12,273,000 in 1993, representing an     
increase of 12.56 %. Net interest income on a taxable-equivalent basis was      
$12,273,000 in 1993 as compared to $9,325,000 in 1992, representing an increase 
of 31.61%. However, the net interest margin decreased by 2.73% to 5.34% in 1993 
from 5.49% in 1992 because average interest-earning assets increased by 35.49%  
in 1993 as compared to 1992.                                                    

           Average interest-earning assets increased by $15,912,000 or
6.92% to $245,869,000 in 1994 from $229,957,000 in 1993. Average loans increased
by $20,706,000; average investments increased by $ 3,744,000; and average       
Federal funds sold decreased by $8,538,000. The increase in average interest-   
earning assets was funded by an increase in average deposits of $9,424,000 or   
4.08% to $240,177,000 in 1994 from $230,753,000 in 1993. By comparison, average 
interest-earning assets increased by $60,231,000 or 35.49% to $229,957,000 in   
1993 from $169,726,000 in 1992. During 1993, average deposits increased by      
$62,669,000 or 37.28%, to $230,753,000 from $168,084,000 in 1992. Approximately 
16% of the average deposits were noninterest-bearing deposits in 1994 as        
compared to 15% noninterest-bearing deposits in 1993.                           

                The allowance for loan losses represents a reserve for potential
losses in the loan portfolio. The adequacy of the allowance for loan losses is  
evaluated periodically based on a review of all significant loans, with a       
particular emphasis on nonaccruing, past due and other loans that management    
believes require attention.                                                     

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RESULTS OF OPERATIONS (CONTINUED)                                               

            The provision for loan losses is a charge to earnings in the
current period to replenish the allowance and maintain it at a level management 
has determined to be adequate. The provision for loan losses charged to earnings
amounted to $638,000 in 1994, $1,191,000 in 1993, and $1,129,000 in 1992. The   
decrease in the provision for loan losses in 1994 of $553,000, or 46.45%, as    
compared with 1993 is attributable to a decrease in net charge-offs in 1994 of  
$1,181,000, or 72.32%, as compared to 1993. Net charge-offs represented 70.85%  
of the provision for loan losses in 1994 as compared to 137% in 1993. The       
decrease in loan charge-offs in 1994 resulted from an improvement in the quality
of the collateral held as security on loans and the ability of the creditors to 
service their debt. The loan charge-offs for 1994 represented .25% of average   
loans outstanding during the year as compared to 1.02% for 1993. At December 31,
1994, the allowance for loan losses was 1.96% of total loans outstanding as     
compared to an allowance for loan losses of 2.21% of total loans outstanding at 
December 31, 1993. The determination of the allowance rests upon management's   
judgment about factors affecting loan quality and assumptions about the local   
and national economy. Management considers the year-end allowance for loan      
losses adequate to cover potential losses in the loan portfolio.                

              Following is a comparison of noninterest income for 1994, 1993
and 1992.                                                                       

                                                        [Enlarge/Download Table]

                                                 1994          1993         1992     
                                             ------------  ------------  ------------
                                                                                     
Service charges on deposit accounts          $2,456,000    $2,299,000    $1,729,000  
Other service charges, commissions and fees     224,000       230,000       153,000  
Other income                                    345,000       338,000       212,000  
                                             ------------  ------------  ------------
                                             $3,025,000    $2,867,000    $2,094,000  
                                             ============  ============  ============

          The most significant increase in noninterest income was an
increase in service charges on deposit accounts of $157,000 in 1994 over 1993,  
representing an increase of 6.83%. This increase i n service charges was        
achieved by an increase in average deposits of $9,424,000 during 1994 as        
compared to 1993. Of the total increase in noninterest income of $773,000 in    
1993 over 1992, $545,000 or 70.50% was attributable to Cairo Bank which was     
acquired on October 1, 1992 and accounted for as a purchase. Under purchase     
accounting, only three months of operations of Cairo Bank was included in income
in 1992.                                                                        

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RESULTS OF OPERATIONS (CONTINUED)                                               

              Following is an analysis of noninterest expense for 1994, 1993
and 1992.                                                                       

                                                                [Download Table]

                                     1994          1993           1992   
                                 ------------  ------------  ------------
                                                                         
Salaries and employee benefits   $ 5,711,000   $ 5,238,000   $ 3,886,000 
Occupancy and equipment expense    1,754,000     1,567,000     1,143,000 
Deposit insurance premiums           559,000       551,000       383,000 
Data processing fees                 448,000       290,000       306,000 
Other expense                      3,075,000     2,889,000     2,312,000 
                                 ------------  ------------  ------------
                                 $11,547,000   $10,535,000   $ 8,030,000 
                                 ============  ============  ============

              Salaries and employee benefits increased $473,000, or 9.03% in
1994 over 1993. Salaries increased $266,000; bonuses increased $154,000; and    
employee benefits increased $53,000. The increase in bonuses was attributable to
the significant increase in income before income taxes of $808,000 in 1994 as   
compared to 1993. The most significant increases in noninterest expense in 1993 
over 1992 were an increase in salaries and benefits of $1,352,000, of which     
Cairo Bank accounted for $1,035,000 or 76%, and an increase in occupancy and    
equipment expense of $424,000, of which Cairo Bank accounted for $344,000 or    
81%. Deposit insurance premiums increased in 1993 over 1992 by $168,000, of     
which $150,000 was attributable to Cairo Bank. After eliminating the increases  
in other noninterest expense attributable to Cairo Bank, all other noninterest  
expenses increased by approximately 7% in 1993 over 1992.                       

      Average total assets increased $11,843,000 or 4.61% to
$268,490,000 in 1994 as compared to $256,647,000 in 1993. The increase in       
average total assets was accompanied by an increase in average deposits of      
$9,424,000 or 4.08%. The increase in average assets of $67,265,000 or 35.52% to 
$256,647,000 in 1993 as compared to $189,382,000 in 1992 was attributable       
primarily to the acquisition of Cairo Bank on October 1, 1992 which accounted   
for an increase in average assets in 1993 over 1992 of $56,384,000 or 19.30%.   

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              Following is a condensed summary of the increase in net income
in 1994 as compared to 1993.                                                    

                                                        [Enlarge/Download Table]


                                                                                   INCREASE     
                                                                                  (DECREASE)    
                                                   1994            1993            IN NET       
                                                                                   INCOME       
                                             ---------------  ----------------  ----------------
                                                                                                
Net interest income                            $ 13,500,000    $ 11,965,000     $  1,535,000    
Provision for loan losses                           638,000       1,191,000          553,000    
Other income                                      3,025,000       2,867,000          158,000    
Other expense                                    11,547,000      10,535,000       (1,012,000)   
                                              --------------  ----------------  ----------------
         Income before income taxes and                                                         
            cumulative effect of change                                                         
            in accounting                        4,340,000        3,106,000       1,234,000     
Applicable income taxes                          1,240,000          814,000        (426,000)    
                                             ---------------  ---------------   --------------- 
         Income before cumulative effect of                                                     
            change in accounting                 3,100,000        2,292,000         808,000     
Cumulative effect of change in method of                                                        
 accounting for income taxes                            -           346,000        (346,000)    
                                             ---------------  ----------------  --------------- 
         Net income                            $ 3,100,000      $ 2,638,000       $ 462,000     
                                             ===============  ================  ================

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SELECTED STATISTICAL INFORMATION OF ABC BANCORP 

       The following statistical information should be read in
conjunction with "Management's Discussion and Analysis of Financial Condition   
and Results of Operation" and the financial statements and related notes        
included elsewhere in this Annual Report and in the documents incorporated      
herein by reference.                                                            

AVERAGE BALANCES AND NET INCOME ANALYSIS                                        

          The following tables set forth the amount of the Company's
interest income or interest expense for each category of interest-earning assets
and interest-bearing liabilities and the average interest rate for total        
interest-earning assets and total interest-bearing liabilities, net interest    
spread and net yield on average interest-earning assets. Federally tax-exempt   
income is presented on a taxable-equivalent basis assuming a 34% Federal tax    
rate.                                                                           

                                                        [Enlarge/Download Table]

                                                                  YEAR ENDED DECEMBER 31,                                           
                              ------------------------------------------------------------------------------------------------------
                                            1994                            1993                              1992                  
                              ----------------------------------- --------------------------------  --------------------------------

                                            INTEREST   AVERAGE               INTEREST    AVERAGE              INTEREST    AVERAGE   

                                AVERAGE     INCOME/     YIELD/    AVERAGE    INCOME/      YIELD/    AVERAGE   INCOME/      YIELD/   

                                BALANCE     EXPENSE   RATE PAID   BALANCE    EXPENSE    RATE PAID   BALANCE   EXPENSE    RATE PAID  
                              ----------    --------- ----------- --------   ---------- ----------  --------- ---------- -----------
                                                                  (DOLLARS IN THOUSANDS)                                            
                              ------------------------------------------------------------------------------------------------------
                                                                                                                                    
ASSETS                                                                                                                              

Interest-earning assets:                                                                                                            

   Loans, net of unearned                                                                                                           

      interest                  $ 180,682    $  18,017  9.97 %   $  159,976  $  16,278   10.18 %  $  118,313  $  12,551  10.61 %    

   Investment securities:                                                                                                           

      Taxable                      35,099       1,928   5.49         32,851     1,997     6.08        20,797     1,766   8.49       

      Nontaxable                   10,761         924   8.59          9,265       905     9.77        10,683     1,026   9.60       

   Federal funds sold              19,327         773   4.00         27,865       825     2.96        19,933       674   3.38       
                                ----------  ---------- --------- -----------  -------   ---------  ----------  -------- ------      
        Total interest-earning                                                                                                      

          assets                  245,869      21,642   8.80        229,957    20,005     8.70       169,726    16,017   9.44       
                                ----------   ---------            ----------- --------             ----------  ---------            

Noninterest-earning assets:                                                                                                         

   Cash                            16,132                            16,035                            3,074                        

   Allowance for loan losses       (3,951)                           (2,950)                          (2,061)                       

   Other assets                    10,440                            13,605                           18,643                        
                                -----------                       -----------                      ----------                       
      Total noninterest-earning                                                                                                     

        assets                     22,621                            26,690                           19,656                        
                                -----------                       -----------                      ----------                       

          Total assets          $ 268,490                         $ 256,647                        $ 189,382                        
                                ===========                       ===========                      ==========                       

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                                                        [Enlarge/Download Table]


                                                                   YEAR ENDED DECEMBER 31,                                          
                               ---------------------------------------------------------------------------------------------------- 

                                               1994                           1993                             1992                 
                               --------------------------------------- -------------------------------------- --------------------- 

                                               INTEREST   AVERAGE            INTEREST    AVERAGE              INTEREST    AVERAGE   

                                   AVERAGE     INCOME/     YIELD/   AVERAGE  INCOME/      YIELD/    AVERAGE   INCOME/      YIELD/   

                                   BALANCE     EXPENSE   RATE PAID  BALANCE  EXPENSE    RATE PAID   BALANCE   EXPENSE    RATE PAID  
                               ------------    --------- ---------  -------- ---------  ---------- ---------- ---------- ---------  
                                                                   (DOLLARS IN THOUSANDS)                                           
                               ---------------------------------------------------------------------------------------------------  

                                                                                                                                    
LIABILITIES AND                                                                                                                     

  STOCKHOLDERS' EQUITY                                                                                                              

 Interest-bearing liabilities:                                                                                                      

     Savings and interest-bearing                                                                                                   

       demand deposits             $  88,482   $  2,539   2.87 %    $  87,867  $  2,686   3.06 %     $  61,523  $  2,024   3.29 %   

     Time deposits                   112,730      5,064   4.49        108,288     4,808   4.44          85,886     4,577   5.33     

     Federal funds purchased                                                                                                        

       and repurchase                                                                                                               

       agreements                      2,557         68   2.66             -         -     -               -          -      -      

     Debt                              1,931        157   8.13          3,654       238   6.51           1,026        91   8.87     
                                    ---------  -------- ---------  -----------  ------- ---------   ----------   ------- -----------

       Total interest-bearing                                                                                                       

          liabilities               205,700      7,828   3.81         199,809     7,732   3.87         148,435     6,692   4.51     
                                    ---------  --------             ---------- ---------              ---------   -------           

Noninterest-bearing liabilities                                                                                                     

   and stockholders' equity:                                                                                                        

   Demand deposits                   38,965                            34,598                           20,675                      

   Other liabilities                  1,659                             2,915                            1,658                      

   Stockholders' equity              22,166                            19,325                           18,614                      
                               -------------                      -------------                   --------------                    

      Total noninterest-bearing                                                                                                     

        liabilities and                                                                                                             

        stockholders' equity         62,790                           56,838                            40,947                      
                                ------------                      -------------                   ---------------                   

    Total liabilities and                                                                                                           

      stockholders' equity        $ 268,490                        $ 256,647                        $  189,382                      
                                ============                      =============                   ===============                   

Interest rate spread                                     4.99 %                          4.83 %                           4.93 %    
                                                        ========                        ========                         ========   

Net interest income                              $  13,814                        $  12,273                         $  9,325        
                                                 ==========                       ==========                        =========       

Net interest margin                                      5.62  %                         5.34  %                           5.49 %   
                                                        =========                       =========                         ========  

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RATE AND VOLUME ANALYSIS                                                        

   The following table reflects the changes in net interest income
resulting from changes in interest rates and from asset and liability volume.   
Federally tax-exempt interest is presented on a taxable-equivalent basis        
assuming a 34% Federal tax rate. The change in interest attributable to rate has
been determined by applying the change in rate between years to average balances
outstanding in the later year. The change in interest due to volume has been    
determined by applying the rate from the earlier year to the change in average  
balances outstanding between years. Thus, changes that are not solely due to    
volume have been consistently attributed to rate.                               

                                                        [Enlarge/Download Table]

                                                                      YEAR ENDED DECEMBER 31,                        
                                             ------------------------------------------------------------------------
                                                         1994 VS. 1993                      1993 VS. 1992            
                                             --------------------------------------  --------------------------------
                                              INCREASE        CHANGES DUE TO      INCREASE        CHANGES DUE TO     
                                                          ---------------------              ------------------------
                                             (DECREASE)       RATE     VOLUME    (DECREASE)       RATE     VOLUME    
                                             ----------   ----------- ---------  ----------   ----------- -----------
                                                                      (DOLLARS IN THOUSANDS)                         
                                             ------------------------------------------------------------------------
                                                                                                                     
Increase (decrease) in:                                                                                              
 Income from earning assets:                                                                                         
   Interest and fees on loans               $   1,739    $   (368)   $   2,107   $   3,727  $   (693)  $   4,420     
   Interest on securities:                                                                                           
      Taxable                                     (69)       (206)         137         231      (793)       1,024    
      Nontaxable                                   19        (127)         146        (121)       15         (136)   
   Interest on deposits in banks                  (52)        201         (253)        151      (117)         268    
                                             ---------   ----------   -----------  --------- ---------   ----------  
          Total interest income                 1,637        (500)       2,137       3,988    (1,588)       5,576    
                                             ---------   ----------   -----------  ---------  --------   ----------  

Expense from interest-bearing liabilities:                                                                           
 Interest on savings and interest-                                                                                   
   bearing demand deposits                       (147)       (166)          19         662      (205)         867    
 Interest on time deposits                        256          59          197         231      (963)       1,194    
 Interest on short-term deposits                   68          -            68          -         -            -     
 Interest on debt                                 (81)         31         (112)        147       (86)         233    
                                             ---------  ------------- ----------   --------   --------   ---------   
          Total interest expense                   96         (76)         172       1,040    (1,254)       2,294    
                                             ---------  ------------  ----------   --------  ---------   ---------   
          Net interest income                $  1,541     $  (424)    $  1,965   $   2,948  $   (334)  $    3,282    
                                             =========  ============  ==========   ========  =========   =========   


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ASSET/LIABILITY MANAGEMENT                                                      

        A principal objective of the Company's asset/liability
management strategy is to minimize its exposure to changes in interest rates by 
matching the maturity and repricing horizons of interest-earning assets and     
interest-bearing liabilities. This strategy is overseen in part through the     
direction of the Asset and Liability Committee (the "ALCO Committee") of each   
Bank, which establishes policies and monitors results to control interest rate  
sensitivity.                                                                    

             Management's strategy is to maintain a balanced interest rate
risk position to protect its net interest margin from market fluctuations. To   
this end, the ALCO Committee of each Bank reviews, on a monthly basis, the      
maturity and repricing of assets and liabilities. The Company has adopted a goal
of achieving and maintaining a one-year gap ratio between rate sensitive assets 
to rate sensitive liabilities of 80% to 120%. Management believes that the type 
and amount of the Company's interest rate-sensitive liabilities (a significant  
portion of which are composed of money market, NOW and savings accounts whose   
yields, to a certain extent, are subject to the discretion of management) may   
reduce the potential impact that a rise in interest rates might have on the     
Company's net interest income.                                                  

          As of December 31, 1994, the Company's cumulative one-year
interest rate sensitivity gap ratio was 130%. This indicates that the Company's 
interest-earning assets will reprice during this period at a rate slightly      
faster than the Company's interest-bearing liabilities. Certain assumptions     
regarding the interest sensitivity of these assets and liabilities have been    
incorporated into this analysis. The Company believes that it has positioned    
itself to maintain its net interest margin in the event of changes in interest  
rates. There can be no assurance, however, that this strategy will be           
successful.                                                                     

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                The following table sets forth the distribution of the repricing
of the Company's earning assets and interest-bearing liabilities as of December 
31, 1994, the interest rate sensitivity gap (i.e., interest rate sensitive      
assets less interest rate sensitive liabilities), the cumulative interest rate  
sensitivity gap ratio (i.e., interest rate sensitive assets divided by interest 
rate sensitivity liabilities) and the cumulative sensitivity gap ratio. The     
table also sets forth the time periods in which earning assets and liabilities  
will mature or may reprice in accordance with their contractual terms. However, 
the table does not necessarily indicate the impact of general interest rate     
movements on the net interest margin since the repricing of various categories  
of assets and liabilities is subject to competitive pressures and the needs of  
the Banks' customers. In addition, various assets and liabilities indicated as  
repricing within the same period may in fact reprice at different times within  
such period and at different rates.                                             

                                                        [Enlarge/Download Table]


                                                                       AT DECEMBER 31, 1994                       
                                                    --------------------------------------------------------------
                                                                    MATURING OR REPRICING WITHIN                  
                                                    --------------------------------------------------------------
                                                      ZERO TO        THREE          ONE                           
                                                       THREE        MONTHS TO       TO           OVER             
                                                      MONTHS        ONE YEAR    FIVE YEARS   FIVE YEARS   TOTAL   
                                                    ----------    ------------ ------------ ------------ ---------
                                                                         (DOLLARS IN THOUSANDS)                   
                                                   ---------------------------------------------------------------
                                                                                                                  
EARNING ASSETS:                                                                                                   
  Federal fund sold                               $   21,902       $       -   $       -    $       -   $ 21,902  
  Investment securities                                4,110            9,866      25,755        6,774    46,505  
  Loans                                               86,081           19,830      70,660       15,553   192,124  
                                                   -----------    -----------  -----------  ---------- ---------  
                                                     112,093           29,696      96,415       22,327   260,531  
                                                   -----------    -----------  -----------  ---------- ---------- 
Interest-bearing liabilities:                                                                                     
  Interest-bearing demand deposits (1)                     -           17,417      45,845            -    63,262  
  Savings                                                  -               -       23,644            -    23,644  
  Certificates less than $100,000                     17,829           50,518      25,875            -    94,222  
  Certificates, $100,000 and over                      3,734           17,136       6,421            -    27,291  
  Securities sold under agreements to repurchase       2,338               -           -             -     2,338  
                                                   -----------     ----------- ------------ ----------- --------- 
                                                      23,901           85,071     101,785            -   210,757  
                                                   -----------     ----------- ------------ ----------- --------- 

Interest rate sensitivity gap                     $   88,192       $  (55,375) $   (5,370) $    22,327  $ 49,774  
                                                   ===========     ============  ==========  ========== ========= 

Cumulative interest rate sensitivity gap          $   88,192       $   32,817  $   27,447  $    49,774            
                                                   ===========     ============  ==========  ==========           

Interest rate sensitivity gap ratio                     4.69             0.35        0.95          N/A            
                                                   ===========     ============   =========  ==========           

Cumulative interest rate sensitivity gap ratio          4.69             1.30        1.13         1.24            
                                                   ===========     ============   =========  ==========           

(1)     The Company has found that NOW checking accounts and savings deposits   
        are generally not sensitive to changes in interest rates and, therefore,
      it has placed such liabilities in the "One to Five Years" category. It
      has also found that the money-market checking deposits reprice between
three months to one year, on the average.                       

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INVESTMENT PORTFOLIO  

   The Company manages the mix of asset and liability maturities in an
effort to control the effects of changes in the general level of interest rates 
on net interest income. See "--Asset/Liability Management." Except for its      
effect on the general level of interest rates, inflation does not have a        
material impact on the Company due to the rate variability and short-term       
maturities of its earning assets. In particular, approximately 55% of the loan  
portfolio is comprised of loans which mature or reprice within one year or less.
Mortgage loans, primarily with five to fifteen year maturities, are also made on
a variable rate basis with rates being adjusted every one to five years.        
Additionally, 30% of the investment portfolio matures within one year.          

TYPES OF INVESTMENTS                                                            

      The carrying value of investments in securities at the dates indicated
are summarized as follows:                                                      

                                                                [Download Table]

                                                       DECEMBER 31,        
                                                 --------------------------
                                                     1994        1993      
                                                 ------------  ------------
                                                   (DOLLARS IN THOUSANDS)  
                                                 --------------------------
                                                                           
U. S. Treasury and government agencies           $  33,809       $  32,033 
State and political subdivisions                     9,819          11,004 
Mortgage-backed securities                           2,617           2,600 
Other securities                                       260             300 
                                                 ----------      ----------
                                                 $  46,505       $  45,937 
                                                 ==========      ==========

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MATURITIES                                                                      

   The amounts of investments in securities in each category as of
December 31, 1994 are shown in the following table according to contractual     
maturity classifications (1) one year or less, (2) after one year through five  
years, (3) after five years through ten years, and (4) after ten years.         

                                                        [Enlarge/Download Table]


                                       U. S. TREASURY                                

                                       AND OTHER U. S.                               

                                     GOVERNMENT AGENCIES          STATE AND          

                                       AND CORPORATIONS      POLITICAL SUBDIVISIONS  

                                                    YIELD                     YIELD  

                                       AMOUNT        (1)       AMOUNT        (1) (2) 
                                     ----------    --------- ----------    ----------
                                                  (DOLLARS IN THOUSANDS)             
                                     ------------------------------------------------

                                                                                     
MATURITY:                                                                            

 One year or less                    $   13,271     4.61  %    $      575    9.71 %  
 After one year through five years       23,200     5.88            2,482    7.59    
 After five years through ten years         215     9.54            4,934    7.74    
 After ten years                                                    1,828    8.84    
                                     ------------   ---------  ----------   -------- 
                                     $   36,686     5.45  %    $    9,819    8.02 %  
                                     ============   =========  ==========   ======== 

(1)    Yields were computed using coupon interest, adding discount accretion or 
       subtracting premium amortization, as appropriate, on a ratable basis over
     the life of each security. The weighted average yield for each maturity
     range was computed using the acquisition price of each security in that
range.                                                            

(2)    Yields on securities of state and political subdivisions are stated on a 
taxable-equivalent basis, using a tax rate of 34%.                

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LOAN PORTFOLIO  

TYPES OF LOANS                                                                  

        Management believes that the Company's loan portfolio is
adequately diversified. The loan portfolio contains no foreign or energy-related
loans or significant concentrations in any one industry, with the exception of  
agricultural-related loans, which constituted approximately 27% of the Company's
loan portfolio as of December 31, 1994. The amount of loans outstanding at the  
indicated dates is shown in the following table according to type of loans.     

                                                        [Enlarge/Download Table]

                                                               DECEMBER 31,                             
                                    ------------------------------------------------------------------- 
                                       1994          1993           1992         1991           1990    
                                    ----------    -----------    ----------    ----------     --------- 
                                                          (DOLLARS IN THOUSANDS)                        
                                    ------------------------------------------------------------------- 

                                                                                                        
Commercial and financial            $  23,531     $   20,849     $  19,650     $  11,379      $   9,556 
Agricultural                           17,079          9,767        10,789         8,109          6,696 
Real estate - construction              1,828          3,387         2,130         1,421          1,920 
Real estate -  mortgage, farmland      34,887         29,489        24,922        14,129         11,003 
Real estate - mortgage,                                                                                 
 commercial                            35,242         27,402        22,284        12,506          7,493 
Real estate -mortgage, residential     44,064         41,902        43,500        31,343         28,608 
Consumer instalment loans              34,213         27,231        25,979        19,007         22,589 
Other                                   1,280          1,720         1,691         2,754          1,679 
                                    ----------    -----------    ----------    ----------     ----------
                                      192,124        161,747       150,945       100,648         89,544 
Less reserve for possible loan                                                                          
 losses                                 3,757          3,571         4,013         1,257          1,046 
                                    ----------    -----------    ----------    ----------     ----------
Loans, net                          $ 188,367     $  158,176     $ 146,932     $  99,391      $  88,498 
                                    ==========    ==========     ==========    ==========     ==========

MATURITIES AND SENSITIVITY TO CHANGES IN INTEREST RATES                         

              Total loans as of December 31, 1994 are shown in the following
table according to maturity or repricing opportunities (1) one year or less, (2)
after one year through five years, and (3) after five years.                    

                                                                [Download Table]

                                    (DOLLARS IN
                                     THOUSANDS)
                                     ----------
MATURITY OR REPRICING WITHIN:                  
                                               
 One year or less                    $ 105,911 
 After one year through five years      70,660 
 After five years                       15,553 
                                     ----------
                                     $ 192,124 
                                     ==========

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              The following table summarizes loans at December 31, 1994 with
the due dates after one year which (1) have predetermined interest rates and (2)
have floating or adjustable interest rates.                                     

                                                                [Download Table]

                                                                (DOLLARS IN
                                                                THOUSANDS) 
                                                                -----------

                                                                           
Predetermined interest rates                                    $  86,213  

Floating or adjustable interest rates                           $  86,213  

              Records were not available to present the above information in
each category listed in the first paragraph above and could not be reconstructed
without undue burden.                                                           

NONPERFORMING LOANS                                                             

         The following table presents, at the dates indicated, the
aggregate of nonperforming loans for the categories indicated.                  

                                                        [Enlarge/Download Table]


                                                              DECEMBER 31,                            
                                   -------------------------------------------------------------------
                                      1994          1993          1992          1991          1990    
                                   -----------   -----------   -----------   -----------   -----------
                                                         (DOLLARS IN THOUSANDS)                       
                                   -------------------------------------------------------------------
                                                                                                      
Loans accounted for on a                                                                              
  nonaccrual basis                 $   3,460     $   3,119     $    5,605    $     511     $      396 
Instalment loans and term loans                                                                       
contractually past due ninety                                                                         
days or more as to interest or                                                                        
principal payments and still                                                                          
accruing                                 103           316            595          563            754 

Loans, the terms of which have                                                                        
been renegotiated to provide a                                                                        
reduction or deferral of interest                                                                     
or principal because of                                                                               
deterioration in the financial                                                                        
position of the borrower                 358            -              -            -              -  

Loans now current about which                                                                         
there are serious doubts as to                                                                        
the ability of the borrower                                                                           
to comply with present loan                                                                           
repayment terms                           -             -              -            -              -  

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                In the opinion of management, any loans classified by regulatory
authorities as doubtful, substandard or special mention that have not been      
disclosed above do not (i) represent or result from trends or uncertainties     
which management reasonably expects will materially impact future operating     
results, liquidity or capital resources, or (ii) represent material credits     
about which management is aware of any information which causes management to   
have serious doubts as to the ability of such borrowers to comply with the loan 
repayment terms. Any loans classified by regulatory authorities as loss have    
been charged off.                                                               

COMMITMENTS AND LINES OF CREDIT                                                 

          In the ordinary course of business, the Banks have granted
commitments to extend credit to approved customers. Generally, these commitments
to extend credit have been granted on a temporary basis for seasonal or         
inventory requirements and have been approved by the Banks' Board of Directors. 
The Banks have also granted commitments to approved customers for standby       
letters of credit. These commitments are recorded in the financial statements   
when funds are disbursed or the financial instruments become payable. The Banks 
use the same credit policies for these off balance sheet commitments as they do 
for financial instruments that are recorded in the consolidated financial       
statements. Commitments generally have fixed expiration dates or other          
termination clauses and may require payment of a fee. Since many of the         
commitment amounts expire without being drawn upon, the total commitment amounts
do not necessarily represent future cash requirements.                          

        Following is a summary of the commitments outstanding at
December 31, 1994 and 1993.                                                     

                                                                [Download Table]

                                        1994         1993   
                                     ----------   ----------
                                      (DOLLARS IN THOUSANDS)
                                     -----------------------
                                                            
Commitments to extend credit         $  22,344    $  20,831 
Standby letters of credit                  590        1,081 
                                     ----------   ----------
                                     $  22,934    $  21,912 
                                     ==========   ==========

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SUMMARY OF LOAN LOSS EXPERIENCE 

           The provision for possible loan losses is created by direct
charges to operations. Losses on loans are charged against the allowance in the 
period in which such loans, in management's opinion, become uncollectible.      
Recoveries during the period are credited to this allowance. The factors that   
influence management's judgment in determining the amount charged to operating  
expense are past loan experience, composition of the loan portfolio, evaluation 
of possible future losses, current economic conditions and other relevant       
factors. The Company's allowance for loan losses was approximately $3,757,000 at
December 31, 1994, representing 1.96% of year end total loans outstanding,      
compared with $3,571,000 at December 31, 1993, which represented 2.21% of year  
end total loans outstanding. The allowance for loan losses is reviewed quarterly
based on management's evaluation of current risk characteristics of the loan    
portfolio, as well as the impact of prevailing and expected economic business   
conditions. Management considers the allowance for loan losses adequate to cover
possible loan losses on the loans outstanding.                                  

             Management has not allocated the Company's allowance for loan
losses to specific categories of loans. Based on management's best estimate,    
approximately 30% of the allowance should be allocated to real estate loans, 40%
to commercial, financial and agricultural loans and 30% to consumer/instalment  
loans as of December 31, 1994.                                                  

              The following table presents an analysis of the Company's loan
loss experience for the periods indicated:                                      

                                                        [Enlarge/Download Table]

                                                                             DECEMBER 31,                       
                                                       ---------------------------------------------------------
                                                         1994        1993        1992        1991        1990   
                                                       =========   =========   =========   =========   =========
                                                                        (DOLLARS IN THOUSANDS)                  
                                                       ---------------------------------------------------------
                                                                                                                
Average balance of loans outstanding                   $180,682    $159,976    $118,313    $ 98,737    $ 89,276 
                                                       ---------   ---------   ---------   ---------   ---------
Balance of reserve for possible loan losses at                                                                  
  beginning of period                                  $  3,571    $  4,013    $  1,257    $  1,046    $  1,038 
                                                       ---------   ---------   ---------   ---------   ---------
Charge-offs:                                                                                                    
  Commercial, financial and agricultural                   (431)       (428)       (406)       (214)        (95)
  Real estate                                              (144)     (1,851)       (698)       (200)        (25)
  Consumer                                                 (396)       (374)       (318)        (41)       (271)
Recoveries:                                                                                                     
  Commercial, financial and agricultural                     74         273          26          44          79 
  Real estate                                               265         554         210         166          17 
  Consumer                                                  180         193         113           5          91 
                                                       ---------   ---------   ---------   ---------   ---------
        Net charge-offs                                    (452)     (1,633)     (1,073)       (240)       (204)
                                                       ---------   ---------   ---------   ---------   ---------
Additions to reserve charged to operating expenses          638       1,191       1,129         451         212 
                                                       ---------   ---------   ---------   ---------   ---------
Allowance for loan losses of acquired subsidiary             -           -        2,700          -           -  
                                                       ---------   ---------   ---------   ---------   ---------
          Balance of reserve for possible loan losses  $  3,757    $  3,571    $  4,013    $   1,257   $  1,046 
                                                       =========   =========   =========   =========   =========
Ratio of net loan charge-offs to average loans             .25%       1.02%        .91%         .24%       .23% 
                                                       =========   =========   =========   =========   =========

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DEPOSITS  

         Average amount of deposits and average rate paid thereon,
classified as to noninterest-bearing demand deposits, interest-bearing demand   
and savings deposits and time deposits, for the periods indicated are presented 
below.                                                                          

                                                        [Enlarge/Download Table]

                                                          YEAR ENDED DECEMBER 31,            
                                              -----------------------------------------------
                                                       1994                     1993         
                                              ----------------------   ----------------------
                                               AMOUNT       RATE        AMOUNT        RATE   
                                              ---------   ----------   ---------   ----------
                                                         (DOLLARS IN THOUSANDS)              
                                              -----------------------------------------------
                                                                                             
Noninterest-bearing demand deposits           $  38,965       -   %   $  34,598         -   %
Interest-bearing demand and savings deposits     88,482     2.87         87,867       3.06   
Time deposits                                   112,730     4.49        108,288       4.44   
                                              ---------               ---------              
        Total deposits                        $ 240,177               $ 230,753              
                                              =========               =========              

                The amounts of time certificates of deposit issued in amounts of
$100,000 or more as of December 31, 1994, are shown below by category, which is 
based on time remaining until maturity of (1) three months or less, (2) over    
three through twelve months and (3) over twelve months.                         

                                                                [Download Table]

                                  (Dollars in
                                  Thousands) 
                                  -----------
                                             
Three months or less              $   3,734  

Over three through twelve months     17,136  

Over twelve months                    6,421  
                                  -----------
        Total                     $  27,291  
                                  ===========

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RETURN ON ASSETS AND SHAREHOLDERS' EQUITY 

        The following rate of return information for the periods
indicated is presented below.                                                   

                                                                [Download Table]

                                     Year Ended December 31,         
                            -----------------------------------------
                               1994           1993           1992    
                            -----------    -----------    -----------
                                                                     
Return on assets  (1)           1.15  %        1.03  %        0.78  %

Return on equity  (2)          13.99          13.65           7.98   

Dividends payout ratio (3)     27.14          27.34          48.72   

Equity to assets ratio (4)      8.26           7.53           9.83   

(1)   Net income divided by average total assets.                               

(2)   Net income divided by average equity.                                     

(3)   Dividends declared per share divided by net income per share.             

(4)   Average equity divided by average total assets.                           

ITEM 7.         FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                     

              The following consolidated financial statements of the Company
and its subsidiaries are included on pages F-1 through F-30 of this Annual      
Report on Form 10-KSB:                                                          

Consolidated Balance Sheets - December 31, 1994 and 1993        

       Consolidated Statements of Income - Years ended December 31, 1994, 1993
and 1992                                                        

      Consolidated Statements of Stockholders' Equity - Years ended December
31, 1994, 1993 and 1992                                         

      Consolidated Statements of Cash Flows - Years ended December 31, 1994,
1993 and 1992                                                   

Notes to Consolidated Financial Statements.                     

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ITEM 8.         DISAGREEMENT ON ACCOUNTING AND FINANCIAL DISCLOSURE             

           During 1994, the Company did not change its accountants and
there was no disagreement on any matter of accounting principles or practices   
for financial statement disclosure that would have required the filing of a     
current report on Form 8-K.                                                     

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PART III  

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

        The information required by this Item is incorporated by
reference to the Company's definitive Proxy Statement to be filed with the      
Securities and Exchange Commission pursuant to Regulation 14A within 120 days   
after the end of the fiscal year covered by this Annual Report ("ABC's Proxy    
Statement").                                                                    

          Information concerning the Company's executive officers is
included in Item 1 of Part I of this Annual Report.                             

ITEM 10.        EXECUTIVE COMPENSATION                                          

        The information required by this Item is incorporated by
reference to ABC's Proxy Statement.                                             

ITEM 11.        SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT  

        The information required by this Item is incorporated by
reference to ABC's Proxy Statement.                                             

ITEM 12.        CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                  

        The information required by this Item is incorporated by
reference to ABC's Proxy Statement.                                             

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PART IV 

ITEM 13.        EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K 

Item 13(a) 1., 2. and 3.                                                        

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

1.      Financial statements:                   

     (a)     ABC Bancorp and Subsidiaries:

                             (i)    Consolidated Balance Sheets - December
               31, 1994 and 1993

                               (ii)    Consolidated Statements of Income - Years
   ended

                              December 31, 1994, 1993 and 1992

                              (iii)   Consolidated Statements of Stockholders'
                                     Equity - Years ended December 31, 1994,
           1993 and 1992

                             (iv)    Consolidated Statements of Cash Flows -
                                     Years ended December 31, 1994, 1993 and
  1992

                      (v)    Notes to Consolidated Financial
        Statements

          (b)     ABC Bancorp (Parent Company Only):

                             Parent Company only financial information has
                    been included in Note 14 of Notes to
                  Consolidated financial statements.

2.      Financial statement schedules:          

                        All schedules are omitted as the required information is
                   inapplicable or the information is presented in the
      financial statements or related notes.

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        3.      Exhibits required by Item 601 of Regulation S-B:

                                                                [Download Table]

  Exhibit                                                 
  No.               Description                           
-------           ---------------                         
                                                          
  3.1      Articles of Incorporation, as amended (filed as
           Exhibit 2.1 to the Registrant's Regulation A   
           Offering Statement on Form 1-A (File No. 24A-  
           2630), filed with the Commission on August 14, 
           1987 and incorporated herein by reference).    

  3.2      By-laws of the Registrant, as amended (filed as
           Exhibit 2.2 to the Registrant's Regulation A   
           Offering Statement on Form 1-A (File No. 24A-  
           2630), filed with the Commission on August 14, 
           1987 and incorporated herein by reference).    

  10.1 *   1985 Incentive Stock Option Plan (filed as     
           Exhibit 5.1 to the Registrant's Regulation A   
           Offering Statement on Form 1-A (File No. 24A-  
           2630), filed with the Commission on August 14, 
           1987 and incorporated herein by reference).    

  10.2 *   Incentive Stock Option Agreement with Kenneth  
           J. Hunnicutt dated October 17, 1985 (filed as  
           Exhibit 5.2 to the Registrant's Regulation A   
           Offering Statement on Form 1-A (File No. 24A-  
           2630), filed with the Commission on August 14, 
           1987 and incorporated herein by reference).    

 10.3 *    Deferred Compensation Agreement for Kenneth J. 
           Hunnicutt dated December 16, 1986 (filed as    
           Exhibit 5.3 to the Registrant's Regulation A   
           Offering Statement on Form 1-A (File No. 24A-  
           2630), filed with the Commission on August 14, 
           1987 and incorporated herein by reference).    

 10.4      Security Deed in favor of M.I.A., Co. dated    
           December 31, 1984 (filed as Exhibit 5.4 to the 
           Registrant's Regulation A Offering Statement on
           Form 1-A (File No. 24A-2630), filed with the   
           Commission on August 14, 1987 and incorporated 
           herein by reference).                          

 10.5      Loan Agreement and Master Term Note dated      
           December 30, 1986 (filed as Exhibit 5.5 to the 
           Registrant's Regulation A Offering Statement on
           Form 1-A (File No. 24A-2630), filed with the   
           Commission on August 14, 1987 and incorporated 
           herein by reference).                          

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Exhibit                         
No.               Description   
-------           ---------------   
[C]        [S]                      
                     10.6 *    Executive Salary Continuation Agreement dated
                                 February 14, 1984 (filed as Exhibit 10.6 to the
                               Registrant's Annual Report on Form 10-K (File
                               Number 2-71257), filed with the Commission on
                           March 27, 1989 and incorporated herein by
reference).   

                   10.7 *    1992 Incentive Stock Option Plan and Option
                                 Agreement for K. J. Hunnicutt (filed as Exhibit
                                10.7 to the Registrant's Annual Report on Form
                              10-KSB (File Number 0-16181), filed with the
                               Commission on March 30, 1993 and incorporated
       herein by reference).

                      10.8*     Executive Employment Agreement with Kenneth J.
                     Hunnicutt dated September 20, 1994.

                     10.9.*    Executive Consulting Agreement with Eugene M.
                  Vereen dated September 20, 1994.

                     22.1      Subsidiaries of the Company (filed as Exhibit
                                22.1 to the Registrant's Annual Report on Form
                              10-KSB (File Number 0-16181), filed with the
                               Commission on March 30, 1993 and incorporated
       herein by reference).

                     25.1      Power of Attorney relating to this Form10-KSB
                             is set forth on the signature pages to this
Form 10-KSB.  

      *     Identifies management contracts, compensatory plans or other
         remunerative arrangements with the Registrant's executive
officers.                                       

      (b)     The Registrant did not file any reports on Form 8-K during the
  last quarter of the period covered by this report.

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SIGNATURES  
----------  

Pursuant to the requirements of Section 13 or 15(d) 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.                       

                         ABC BANCORP

Date: March 21, 1995      By:      /s/ Kenneth J. Hunnicutt                     
      ------------------     ---------------------------------------------------
                          Kenneth J. Hunnicutt, President, Chief Executive
Officer and Director  

Date: March 21, 1995      By:      /s/ W. Edwin Lane, Jr.                       
      ------------------     ---------------------------------------------------
                      W. Edwin Lane, Jr., Executive Vice President
       and Chief Financial Officer

POWER OF ATTORNEY                 

  KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Kenneth J. Hunmnicutt as his attorney-in-fact,   
acting will full power of substitution for him in his name, place and stead, in 
any and all capacities, to sign any amendments to this Form 10-KSB and to file  
the same, with exhibits thereto, and any other documents in connection          
therewith, with the Securities and Exchange Commission and hereby ratifies and  
confirms all that said attorney-in-fact, or his substitute or substitutes, may  
do or cause to be done by virtue thereof.                                       

     Pursuant to the requirements of the Exchange Act, this Form 10-KSB has been
signed by the following persons in the capacities and on the dates indicated.   

Date: March 21, 1995      /s/ Kenneth J. Hunnicutt                              
      --------------      ------------------------------------------------------
                    Kenneth J. Hunnicutt, President, Chief Executive
Officer and Director    

Date: March 21, 1995      /s/ W. Edwin Lane, Jr.                                
      --------------      ------------------------------------------------------
                     W. Edwin Lane, Jr.,  Executive Vice President and
Chief Financial Officer 

Date: March 21, 1995      /s/ J. Raymond Fulp                                   
      --------------      ------------------------------------------------------
J. Raymond Fulp, Director   

Date: March 21, 1995      /s/ Willard E. Lasseter                               
      --------------      ------------------------------------------------------
                          Willard E. Lasseter, Director and Vice Chairman of the
Board                   

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Date: March 21, 1995      /s/ Bobby B. Lindsey                                  
      --------------      ------------------------------------------------------
Bobby B. Lindsey, Director  

Date: March 21, 1995      /s/ Hal L. Lynch                                      
      --------------      ------------------------------------------------------
Hal L. Lynch, Director      

Date: March 21, 1995      /s/ Joseph C. Parker                                  
      --------------      ------------------------------------------------------
Joseph C. Parker, Director  

Date: March 21, 1995      /s/ Eugene M. Vereen, Jr.                             
      --------------      ------------------------------------------------------
                    Eugene M. Vereen, Jr., Chairman of the Board and
Director                    

Date: March 21, 1995      /s/ Doyle Weltzbarker                                 
      --------------      ------------------------------------------------------
Doyle Weltzbarker, Director 

Date: March 21, 1995      /s/ Henry Wortman                                     
      --------------      ------------------------------------------------------
Henry Wortman, Director     

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EXHIBIT INDEX 

Exhibit                                                                         
No.                                    Description                          
-------                                  -----------                            

3.1     Articles of Incorporation, as amended (filed as Exhibit 2.1 to the  
      Registrant's Regulation A Offering Statement on Form 1-A (File No.
24A-2630), filed with the Commission on August 14, 1987 and 
incorporated herein by reference).                          

3.2     By-laws of the Registrant, as amended (filed as Exhibit 2.2 to the  
      Registrant's Regulation A Offering Statement on Form 1-A (File No.
24A-2630), filed with the Commission on August 14, 1987 and 
incorporated herein by reference).                          

10.1    1985 Incentive Stock Option Plan (filed as Exhibit 5.1 to the       
      Registrant's Regulation A Offering Statement on Form 1-A (File No.
24A-2630), filed with the Commission on August 14, 1987 and 
incorporated herein by reference).                          

10.2    Incentive Stock Option Agreement with Kenneth J. Hunnicutt dated    
         October 17, 1985 (filed as Exhibit 5.2 to the Registrant's Regulation
    A Offering Statement on Form 1-A (File No. 24A-2630), filed with
 the Commission on  August 14, 1987 and incorporated herein by
reference).                                                 

10.3    Deferred Compensation Agreement for Kenneth J. Hunnicutt dated      
          December 16, 1986 (filed as Exhibit 5.3 to the Registrant's Regulation
        A Offering Statement on Form 1-A (File No. 24A-2630), filed with the
        Commission on August 14, 1987 and incorporated herein by reference).

10.3    Security Deed in favor of M.I.A., Co. dated December 31, 1984 (filed
         as Exhibit 5.4 to the Registrant's Regulation A Offering Statement on
         Form 1-A (File No. 24A-2630), filed with the Commission on August 14,
1987 and incorporated herein by reference).                 

 10.5    Loan Agreement and Master Term Note dated December 30, 1986 (filed as
      Exhibit 5.5 to the Registrant's Regulation A Offering Statement on
         Form 1-A (File No. 24A-2630), filed with the Commission on August 14,
1987 and incorporated herein by reference).                 

  10.6    Executive Salary Continuation Agreement dated February 14, 1984 (filed
    as Exhibit 10.6 to the Annual Report on Form10-K (File Number 2-
    71257), filed herewith with the Commission on March 27, 1989 and
incorporated herein by  reference).                         

49

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Exhibit                                                                         
No.                                    Description                          
-------                                  -----------                            

10.7    1992 Incentive Stock Option Plan and Option Agreement for K. J.     
         Hunnicutt (filed at Exhibit 10.7 to the Registrant's Annual Report on
         Form 10-KSB (File Number 0-16181), filed with the Commission on March
30, 1993 and incorporated herein by reference.)             

10.8    Executive Employment Agreement with Kenneth J. Hunnicutt dated      
September 20, 1994.                                         

10.9    Executive Consulting Agreement with Eugene M. Vereen dated September
20, 1994.                                                   

  22.1    Subsidiaries of the Company (filed as Exhibit 22.1 to the Registrant's
     Annual Report on Form 10-KSB (File Number 0-16181, filed with the
       Commission on March 30, 1993 and incorporated herein by reference).

25.1    Power of Attorney relating to this Form 10-KSB is set forth on the  
signature pages to this Form 10-KSB.                        

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ABC BANCORP 

INDEX TO FINANCIAL STATEMENTS AND SCHEDULES 

Consolidated financial statements:                                              

Independent Auditor's Report                                                
Consolidated Balance Sheets - December 31, 1994 and 1993                    
Consolidated Statements of Income - Years ended December 31, 1994, 1993     
and 1992                                                                
Consolidated Statements of Stockholders' Equity - Years ended December 31,  
1994, 1993 and 1992                                                     
Consolidated Statements of Cash Flows - Years ended December 31, 1994, 1993 
and 1992                                                                
Notes to Consolidated Financial Statements                                  

All schedules are omitted as the required information is inapplicable or the    
information is presented in the financial statements or related notes.          

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INDEPENDENT AUDITOR'S REPORT    
================================================================================

TO THE BOARD OF DIRECTORS                                                       
ABC BANCORP                                                                     
MOULTRIE, GEORGIA                                                               

               We have audited the accompanying consolidated balance sheets of
the ABC BANCORP AND SUBSIDIARIES as of December 31, 1994 and 1993, and the      
related consolidated statements of income, stockholders' equity and cash flows  
for each of the three years in the period ended December 31, 1994. These        
financial statements are the responsibility of the Company's management. Our    
responsibility is to express an opinion on these financial statements based on  
our audits.                                                                     

             We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit  
to obtain reasonable assurance about whether the financial statements are free  
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit    
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement       
presentation. We believe that our audits provide a reasonable basis for our     
opinion.                                                                        

              In our opinion, the consolidated financial statements referred
to above present fairly, in all material respects, the financial position of ABC
Bancorp and Subsidiaries as of December 31, 1994 and 1993, and the results of   
their operations and their cash flows for each of the three years in the period 
ended December 31, 1994, in conformity with generally accepted accounting       
principles.                                                                     

                As discussed in Note 1 to the consolidated financial statements,
effective January 1, 1993, the Company changed its method of accounting for     
income taxes.                                                                   

Albany, Georgia                                                                 
January 27, 1995                                                                

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ABC BANCORP AND SUBSIDIARIES  

CONSOLIDATED BALANCE SHEETS 
DECEMBER 31, 1994 AND 1993  
(Dollars in Thousands)  

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

                                                        [Enlarge/Download Table]

ASSETS                                                                  1994        1993    
------                                                              -----------  -----------

                                                                                            
Cash and due from banks                                             $   20,089   $   16,994 
Interest-bearing deposits in banks                                          -         1,257 
Federal funds sold                                                      21,902       31,575 
Securities available for sale, at fair value (Note 3)                    1,910           -  
Securities held for investment, at cost (fair value $43,024                                 
 and $46,856) (Note 3)                                                  44,595       45,937 
Loans (Note 4)                                                         192,124      161,747 
Less allowance for loan losses                                           3,757        3,571 
                                                                    -----------  -----------
         Loans, net                                                    188,367      158,176 
                                                                    -----------  -----------
Premises and equipment, net (Note 5)                                     7,171        5,766 
Other assets                                                             8,765        8,911 
                                                                    $  292,799   $  268,616 
                                                                    ===========  ===========

LIABILITIES AND STOCKHOLDERS' EQUITY                                                        
-----------------------------------                                                         
Deposits                                                                                    
 Noninterest-bearing demand                                         $   48,450   $   38,206 
 Interest-bearing demand                                                63,262       66,156 
 Savings                                                                23,644       28,440 
 Time, $100,000 and over                                                27,291       20,543 
 Other time                                                             94,222       84,880 
                                                                    -----------  -----------
         Total deposits                                                256,869      238,225 
Securities sold under repurchase agreements                              2,338        3,180 
Long-term debt (Note 6)                                                     -         4,677 
Other liabilities                                                        3,142        2,575 
                                                                    -----------  -----------
         Total liabilities                                             262,349      248,657 
                                                                    -----------  -----------
COMMITMENTS AND CONTINGENT LIABILITIES (Note 10)                                            

STOCKHOLDERS' EQUITY (Note 12)                                                              
  Common stock, par value $1; 3,000,000 shares authorized,                                  
    2,697,987 and 1,950,487 shares issued, respectively                  2,698        1,950 
  Capital surplus                                                       17,728       10,152 
  Retained earnings                                                     11,753        9,537 
  Unrealized losses on securities available for sale, net of taxes         (49)          -  
                                                                    -----------  -----------
                                                                        32,130       21,639 
  Less cost of 183,412 shares acquired for the treasury                 (1,680)      (1,680)
                                                                    -----------  -----------
         Total stockholders' equity                                     30,450       19,959 
                                                                    -----------  -----------
                                                                    $  292,799   $  268,616 
                                                                    ===========  ===========

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.                                 

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ABC BANCORP AND SUBSIDIARIES  

CONSOLIDATED STATEMENTS OF INCOME 
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992  
(Dollars in Thousands)  

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

                                                        [Enlarge/Download Table]

                                                                   1994        1993          1992  
                                                               ----------  ------------  ----------
                                                                                                   
INTEREST INCOME                                                                                    
  Interest and fees on loans                                   $ 18,017    $  16,278     $  12,551 
  Interest on taxable securities                                  1,863        1,892         1,629 
  Interest on nontaxable securities                                 610          597           680 
  Interest on deposits in other banks                                65          105           137 
  Interest on Federal funds sold                                    773          825           674 
                                                               ----------  ------------  ----------
                                                                 21,328       19,697        15,671 
                                                               ----------  ------------  ----------

INTEREST EXPENSE                                                                                   
  Interest on deposits                                            7,603        7,476         6,570 
  Interest on securities sold under repurchase agreements            68           18            31 
  Interest on other borrowings                                      157          238            91 
                                                               ----------  ------------  ----------
                                                                  7,828        7,732         6,692 
                                                               ----------  ------------  ----------

          Net interest income                                    13,500       11,965         8,979 
PROVISION FOR LOAN LOSSES (Note 4)                                  638        1,191         1,129 
                                                               ----------  ------------  ----------
          Net interest income after provision for loan losses    12,862       10,774         7,850 
                                                               ----------  ------------  ----------

OTHER INCOME                                                                                       
  Service charges on deposit accounts                             2,456        2,299         1,729 
  Other service charges, commissions and fees                       224          230           153 
  Other                                                             345          338           212 
                                                               ----------  ------------  ----------
                                                                  3,025        2,867         2,094 
                                                               ----------  ------------  ----------
OTHER EXPENSES                                                                                     
  Salaries and employee benefits (Note 7)                         5,711        5,238         3,886 
  Equipment expense                                               1,091          723           599 
  Occupancy expense                                                 663          844           544 
  Amortization of intangible assets                                 268          279           274 
  Data processing fees                                              448          290           306 
  Directors fees                                                    291          270           248 
  FDIC premiums                                                     559          551           383 
  Other operating expenses                                        2,516        2,340         1,790 
                                                               ----------  ------------  ----------
                                                                 11,547       10,535         8,030 
                                                               ----------  ------------  ----------

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ABC BANCORP AND SUBSIDIARIES  

CONSOLIDATED STATEMENTS OF INCOME 
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992  
(Dollars in Thousands)  

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

                                                        [Enlarge/Download Table]

                                                           1994             1993             1992      
                                                        --------------  --------------  ---------------
                                                                                                       
         Income before income taxes and cumulative                                                     
           effect of accounting change                  $   4,340       $   3,106       $  1,914       

Applicable income taxes (Note 9)                            1,240             814            429       
                                                        --------------  --------------  ---------------

         Income before cumulative effect of                                                            
           accounting change                                3,100           2,292          1,485       

Cumulative effect of change in method of accounting                                                    
 for income taxes                                              -              346             -        
                                                        --------------  --------------  ---------------

         Net income                                     $   3,100       $   2,638       $  1,485       
                                                        ==============  ==============  ===============
Income per common share:                                                                               
  Income before cumulative effect of accounting change  $    1.40       $    1.21       $   0.78       
  Cumulative effect of accounting change                       -             0.18             -        
                                                        --------------  --------------  ---------------
         Net income (Note 1)                            $    1.40       $    1.39       $   0.78       
                                                        ==============  ==============  ===============

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.                                 

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ABC BANCORP AND SUBSIDIARIES  

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY 
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992  
(Dollars in Thousands)  

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

                                                        [Enlarge/Download Table]

                                                         COMMON STOCK                                        
                                                 -----------------------------                    RETAINED   
                                                    Shares         PAR VALUE       SURPLUS        EARNINGS   
                                                 -----------     -------------  -------------  --------------
                                                                                                             
BALANCE, DECEMBER 31, 1991                       1,950,487       $   1,950      $  10,152      $    6,812    
  Net income                                            -               -              -            1,485    
  Cash dividends paid, $ .38 per share                  -               -              -             (726)   
  Purchase of 1,000 shares of treasury stock            -               -              -               -     
                                                 -----------     -------------  -------------  --------------
BALANCE, DECEMBER 31, 1992                       1,950,487           1,950         10,152           7,571    
  Net income                                            -               -              -            2,638    
  Cash dividends paid, $.38 per share                   -               -              -             (672)   
  Purchase of 143,024 shares of treasury stock          -               -              -               -     
                                                 -----------     -------------  -------------  --------------
BALANCE, DECEMBER 31, 1993                       1,950,487           1,950         10,152           9,537    
  Net income                                            -               -              -            3,100    
  Cash dividends declared, $.38 per share               -               -              -             (884)   
  Proceeds from sale of stock, net of stock                                                                  
    offering expense                               747,500             748          7,576              -     
Net change in unrealized losses on                                                                           
    securities available for sale, net of taxes         -               -              -               -     
                                                 -----------     -------------  -------------  --------------
BALANCE, DECEMBER 31, 1994                       2,697,987       $   2,698      $  17,728      $   11,753    
                                                 ===========     =============  =============  ==============

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.                                 

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

                                                                [Download Table]

Unrealized                                                  

LOSSES ON                                                   

SECURITIES                                                  

AVAILABLE                                                   

FOR SALE,                TREASURY STOCK                     
                    ------------------------                
NET OF TAXES          SHARES         COST           TOTAL   
--------------      ----------   -----------   -------------

                                                            
$        -             39,388    $    (260)    $    18,654  

         -                 -            -            1,485  

         -                 -            -             (726) 

         -              1,000           (8)             (8) 
--------------      ----------   -----------   -------------
         -             40,388         (268)         19,405  

         -                 -            -            2,638  

         -                 -            -             (672) 

         -            143,024       (1,412)         (1,412) 
--------------      ----------   -----------   -------------
         -            183,412       (1,680)         19,959  

         -                 -            -            3,100  

         -                 -            -             (884) 

         -                 -            -            8,324  

         (49)              -            -              (49) 

--------------      ----------   -----------   -------------
$        (49)         183,412    $  (1,680)    $    30,450  

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

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ABC BANCORP AND SUBSIDIARIES  

CONSOLIDATED STATEMENTS OF CASH FLOWS 
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992  
(Dollars in Thousands)  

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

                                                        [Enlarge/Download Table]

                                                         1994               1993           1992     
                                                     --------------   --------------  --------------
                                                                                                    
CASH FLOWS FROM OPERATING ACTIVITIES                                                                

   Net income                                        $       3,100    $       2,638   $       1,485 
                                                     --------------   --------------  --------------
   Adjustments to reconcile net income to net cash                                                  
   Provided by operating activities:                                                                
    Depreciation and amortization                             809               638             454 
    Amortization of intangible assets                         268               279             274 
    Provision for loan losses                                 638             1,191           1,129 
    Provision for deferred taxes                              (22)             (170)             (6)
    Write-downs of other real estate owned                     53                -               -  
    (Increase) decrease in interest receivable               (804)              100             687 
    Increase (decrease) in interest payable                   104               (90)           (520)
    Increase (decrease) in taxes payable                      184                76            (399)
    Other prepaids, deferrals and accruals, net               798              (178)           (596)
                                                     --------------   --------------  --------------
          Total adjustments                                 2,028             1,846           1,023 
                                                     --------------   --------------  --------------
          Net cash provided by operating activities         5,128             4,484           2,508 
                                                     --------------   --------------  --------------
CASH FLOWS FROM INVESTING ACTIVITIES                                                                
   Decrease in interest-bearing deposits in banks           1,257               100             526 
   Purchases of securities available for sale              (1,664)               -               -  
   Purchases of securities held for investment             (7,524)          (24,502)         (9,618)
   Proceeds from maturities of securities held                                                      
     for investment                                         8,531            13,587          13,214 
   (Increase) decrease in Federal funds sold                9,673             9,565         (11,465)
   (Increase) decrease in loans, net                      (30,829)          (12,435)          1,228 
   Purchase of premises and equipment                      (2,303)             (382)           (980)
   Proceeds from the sale of premises and equipment            22                26              -  
   Net cash received in bank acquisition                       -                 -            1,182 
                                                     --------------   --------------  --------------
          Net cash used in  investing activities          (22,837)          (14,041)         (5,913)
                                                     --------------   --------------  --------------
CASH FLOWS FROM FINANCING ACTIVITIES                                                                
   Increase in deposits                                    18,644             3,755           8,156 
   Increase (decrease) in repurchase agreements              (842)            3,117            (574)
   Proceeds from other borrowings                              -              1,412           3,000 
   Repayment of long-term debt                             (4,677)              (15)           (507)
   Dividends paid                                            (645)             (672)           (726)
   Proceeds from stock offering, net                        8,324                -               -  
   Purchase of shares of stock for the treasury                -             (1,412)             (8)
                                                     --------------  ---------------  --------------
          Net cash provided by financing activities        20,804             6,185           9,341 
                                                     --------------  ---------------  --------------
                                                                            

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ABC BANCORP AND SUBSIDIARIES  

CONSOLIDATED STATEMENTS OF CASH FLOWS 
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992  
(Dollars in Thousands)  

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

                                                        [Enlarge/Download Table]

                                                          1994             1993              1992    
                                                     ---------------  ---------------  --------------
                                                                                                     
Net increase (decrease) in cash and due from banks   $       3,095    $       (3,372)  $       5,936 

Cash and due from banks at beginning  of year               16,994            20,366          14,430 
                                                     ---------------  ---------------  --------------

Cash and due from banks at end of year               $      20,089    $       16,994   $      20,366 
                                                     ===============  ===============  ==============

SUPPLEMENTAL DISCLOSURES OF CASH FLOW                                                                
 INFORMATION                                                                                         
 Cash paid during the year for:                                                                      
  Interest                                           $       7,724    $        7,822   $       7,212 

  Income taxes                                       $       1,078    $          562   $         834 

NONCASH TRANSACTIONS                                                                                 
 Unrealized losses on securities available for sale  $          54    $           -    $          -  

 Property transferred from premises and equipment                                                    
  to other real estate owned                         $         103    $           -    $          -  

 Dividends declared                                  $         239    $           -    $          -  

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.                                 

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ABC BANCORP AND SUBSIDIARIES  
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  

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

NOTE 1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                            

     ABC Bancorp is a bank holding company whose business is presently
         conducted by its wholly-owned subsidiaries, American Banking Company,
    The Bank of Quitman, Bank of Thomas County, The Citizens Bank of
  Tifton and Cairo Banking Company. The accounting and reporting
    policies of the Company conform to generally accepted accounting
      principles and with general practices within the banking industry.

BASIS OF PRESENTATION                                       

         The consolidated financial statements include the accounts of the
           Company and its subsidiaries. Significant intercompany transactions
        and accounts are eliminated in consolidation. Assets held by the
           Banks in a fiduciary or agency capacity are not assets of the Banks
      and are not included in the consolidated financial statements.

CASH AND CASH EQUIVALENTS                                   

   For purposes of reporting cash flows, cash and due from banks
      includes cash on hand and amounts due from banks (including cash
        items in process of clearing). Cash flows from loans originated by
     the Bank, deposits, interest-bearing deposits and Federal funds
purchased and sold are reported net.                      

       The Company maintains amounts due from banks which, at times, may
          exceed Federally insured limits. The Company has not experienced any
losses in such accounts.                                  

INVESTMENTS IN SECURITIES                                   

  The Company's investments in securities are classified and
accounted for as follows:                               

SECURITIES AVAILABLE FOR SALE                           

               Securities available for sale consist of bonds, notes, debentures
               and certain marketable equity securities, and are carried at fair
               value with unrealized gains and losses, net of taxes, reported as
            a net amount, in a separate component of stockholders' equity.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  

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

NOTE 1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)                

SECURITIES HELD FOR INVESTMENT                            

         Bonds, notes and debentures for which the Bank has the positive
      intent and ability to hold to maturity are reported at cost,
          adjusted for amortization of premiums and accretion of discounts
           which are recognized in interest income using the interest method
over the period to maturity.                          

         Realized gains and losses on the sale of securities available for
     sale are determined using the specific-identification method.

LOANS                                                       

      Loans are stated at the amount of unpaid principal, reduced by
          unearned interest. Interest on commercial and real estate loans is
           credited to income on a daily basis based upon the principal amount
      outstanding. Most interest on installment loans is credited to
            income on a daily basis based upon the principal amount outstanding.
         The remaining interest on installment loans is credited to income
          based on the sum-of-the-months-digits method, the results of which
       are not materially different from generally accepted accounting
principles.                                             

        Accrual of interest income is discontinued on loans when, in the
         opinion of management, collection of such interest income becomes
          doubtful. When a loan is placed on nonaccrual status, all interest
        previously accrued but not collected is reversed against current
           interest income. Accrual of interest on such loans is resumed when,
          in management's judgment, the collection of interest and principal
becomes probable.                                       

LOAN FEES                                                   

    Fees on loans and costs incurred in origination of loans are
            recognized at the time the loan is placed on the books. Because loan
          fees are not significant and the majority of loans have maturities
         of one year or less, the results on operations are not materially
            different than the results which would be obtained by accounting for
            loan fees and costs in accordance with generally accepted accounting
principles.                                             

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  

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

NOTE 1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)                

ALLOWANCE FOR LOAN LOSSES                                   

            The allowance for loan losses is established through a provision for
      loan losses charged to expenses. Loans are charged against the
   allowance for loan losses when management believes that the
        collectibility of the principal is unlikely. The allowance is an
           amount that management believes will be adequate to absorb possible
        losses on existing loans that may become uncollectible, based on
      evaluations of the collectibility of loans and prior loan loss
experience.                                             

PREMISES AND EQUIPMENT                                      

  Premises and equipment are stated at cost less accumulated
           depreciation, computed principally on the straight-line method over
the following estimated useful lives:                   

                                                                [Download Table]

                                                       Years
                                                       -----

                                                            
Buildings                                              15-40
Equipment                                               5-7 

INTANGIBLE ASSETS                                           

         Intangible assets, arising from excess of purchase price over net
      assets acquired of purchased banks, are being amortized on the
         straight-line method over various periods not exceeding 25 years.

INCOME TAXES                                                

       The Company and its subsidiaries file a consolidated income tax
      return. Each subsidiary provides for income taxes based on its
          contribution to income taxes (benefits) of the consolidated group.

         As of January 1, 1993, the Company adopted Statement of Financial
     Accounting Standards ("SFAS") No. 109, "Accounting for Income
            Taxes". SFAS No. 109 requires a balance sheet approach to accounting
  for income taxes and requires that deferred tax assets and
            liabilities be adjusted in the period of enactment for the effect of
            an enacted change in tax laws or rates. The adoption of SFAS No. 109
     resulted in an income tax benefit of $345,937, which has been
           included in the consolidated statement of income for the year ended
December 31, 1993 as a cumulative effect.               

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  

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

NOTE 1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)                

EARNINGS PER SHARE                                          

      Earnings per share are calculated on the basis of the weighted
average number of shares outstanding.                   

Current Accounting Developments                             

         The Financial Accounting Standards Board has issued SFAS No. 114,
         "Accounting by Creditors for Impairment of a Loan", which becomes
effective for years beginning after December 15, 1994.  

            SFAS No. 114 generally requires impaired loans to be measured on the
            present value of expected future cash flows discounted at the loan's
  effective interest rate, or as an expedient, at the loan's
          observable market price or the fair value of the collateral if the
            loan is collateral dependent. A loan is impaired when it is probable
            the creditor will be unable to collect all contractual principal and
  interest payments due in accordance with terms of the loan
agreement.                                              

         The adoption of this Statement is not expected to have a material
  effect on the Company's consolidated financial statements.

NOTE 2.   ACQUISITION                                                           

          On October 1, 1992, the Company acquired all of the outstanding common
          stock of Cairo Banking Company for $1,175,000 in cash. The acquisition
         was accounted for as a purchase and, accordingly, the acquired assets
       and liabilities were recorded at their estimated fair values at the
         date of acquisition. There was no resulting excess cost over the fair
       value of assets acquired. The results of operations from October 1,
     1992 have been included in the consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  

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

NOTE 2.   ACQUISITION (Continued)                                               

       Summarized below is the unaudited consolidated pro forma results of
         operations, assuming the acquisition had occurred on January 1, 1992.
         The pro forma financial information does not purport to be indicative
    either of results of operations that would have occurred had the
        acquisition been consummated on January 1, 1992 or future results of
the combined companies.                                     

                                                                [Download Table]

                                                   (UNAUDITED) 
                                                 (IN THOUSANDS,
                                                     EXCEPT    
                                                   PER SHARE   
                                                     AMOUNT)   
                                                 --------------
                                                               
Net interest income                              $       11,194
Other income                                              2,510
Net income                                                1,070
Net income per share                                       0.56

NOTE 3.   INVESTMENTS IN SECURITIES                                             

Effective January 1, 1994, the Company adopted SFAS No. 115,
       "Accounting for Certain Investments in Debt and Equity Securities".
        Upon adoption, the Company transferred $300,005 of marketable equity
          securities from securities held for investment to securities available
         for sale. The securities available for sale were marked to fair value
       resulting in a net unrealized loss of $11,986 which was included in
stockholders' equity at $11,986.                            

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NOTE 3.   INVESTMENTS IN SECURITIES (Continued)                                 

     The carrying amounts of investments in securities as shown in the
         consolidated balance sheets of the Company and their approximate fair
values at December 31, 1994 and 1993 were as follows:       

                                                        [Enlarge/Download Table]

                                                                     GROSS              GROSS                     
                                              AMORTIZED           UNREALIZED          UNREALIZED          FAIR    
                                                COST                GAINS               LOSSES            VALUE   
                                            ------------         ------------        ------------      ---------- 
                                                                       (DOLLARS IN THOUSANDS)                     
                                            ----------------------------------------------------------------------

                                                                                                                  
SECURITIES AVAILABLE FOR SALE                                                                                     
  DECEMBER 31, 1994:                                                                                              
    U. S. GOVERNMENT AND AGENCY SECURITIES  $    1,664           $         -         $      (14)       $    1,650 
    OTHER SECURITIES                               300                     -                (40)              260 
                                            ------------         ------------        ------------      -----------

                                            $    1,964           $         -         $      (54)       $    1,910 
                                            ============         ============        ============      ===========

SECURITIES hELD FOR iNVESTMENT                                                                                    
  DECEMBER 31, 1994:                                                                                              
    U. S. GOVERNMENT AND AGENCY SECURITIES  $   32,159           $         19        $   (1,196)       $   30,982 
    STATE AND MUNICIPAL SECURITIES               9,819                    114              (471)            9,462 
    MORTGAGE-BACKED SECURITIES                   2,617                     22               (59)            2,580 
                                            ------------         ------------        ------------      -----------

                                            $   44,595           $        155        $   (1,726)       $   43,024 
                                            ============         ============        ============      ===========

December 31, 1993:                                                                                                
  U. S. Treasury and government agencies    $   32,033           $        430        $      (42)       $   32,421 
  Municipal securities                          11,004                    469               (78)           11,395 
  Mortgage-backed securities                     2,600                    140                -              2,740 
  Other securities                                 300                     -                 -                300 
                                            ------------         ------------        ------------      -----------

                                            $   45,937           $      1,039        $     (120)       $   46,856 
                                            ============         ============        ============      ===========


There were no sales of securities during 1994, 1993 or 1992.

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NOTE 3.   INVESTMENTS IN SECURITIES (Continued)                                 

      The amortized cost and fair value of securities as of December 31,
       1994 by contractual maturity are shown below. Maturities may differ
         from contractual maturities in mortgage-backed securities because the
       mortgages underlying the securities may be called or repaid without
      any penalties. Therefore, these securities are not included in the
maturity categories in the following maturity summary.      

                                                        [Enlarge/Download Table]

                                   SECURITIES AVAILABLE                SECURITIES HELD     
                                        FOR SALE                        FOR  INVESTMENT    
                                 ---------------------------     ------------------------- 
                                 AMORTIZED            FAIR        AMORTIZED           FAIR 
                                    COST             VALUE           COST            VALUE 
                                 -------------  ------------     ------------  ------------
                                                    (DOLLARS IN THOUSANDS)                 
                                 ----------------------------------------------------------

                                                                                           
Due in one year or less          $    467       $    467         $   13,076    $   12,909  
Due from one year to five years     1,197          1,183             22,140        21,071  
Due from five to ten years             -              -               4,934         4,669  
Due after ten years                    -              -               1,828         1,795  
Mortgage-backed securities             -              -               2,617         2,580  
Marketable equity securities          300            260                 -             -   
                                 -------------  ------------     ------------  ------------
                                 $  1,964         $  1,910         $   44,595  $   43,024  
                                 =============  ============     ============  ============

      Securities with a carrying value of $28,616,565 and $24,540,302 at
    December 31, 1994 and 1993, respectively, were pledged to secure
public deposits and for other purposes.                     

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NOTE 4.   LOANS AND ALLOWANCE FOR LOAN LOSSES                                   

The composition of loans is summarized as follows:          

                                                                [Download Table]

                                                 DECEMBER 31,          
                                     ----------------------------------
                                         1994                  1993    
                                     -----------           ------------
                                           (DOLLARS IN THOUSANDS)      
                                     ----------------------------------
                                                                       
Commercial and financial             $    23,531           $    20,849 
Agricultural                              17,079                 9,767 
Real estate - construction                 1,828                 3,387 
Real estate - mortgage, farmland          34,887                29,489 
Real estate - mortgage, commercial        35,242                27,402 
Real estate - mortgage, residential       44,064                41,902 
Consumer instalment loans                 34,220                27,352 
Other                                      1,280                 1,720 
                                     ------------          ------------
                                         192,131               161,868 
Unearned discount                             (7)                 (121)
Allowance for loan losses                 (3,757)               (3,571)
                                     ------------          ------------
                                     $   188,367           $   158,176 
                                     ============          ============

   Loans on which the accrual of interest had been discontinued or
          reduced amounted to $3,817,699 and $3,119,209 at December 31, 1994 and
        1993, respectively. The reduction in interest income associated with
nonaccrual and renegotiated loans is as follows:            

                                                                [Download Table]

                                                      DECEMBER 31,               
                                    ---------------------------------------------
                                        1994              1993            1992   
                                    -------------    --------------   -----------
                                                (DOLLARS IN THOUSANDS)           
                                    ---------------------------------------------
                                                                                 
Income in accordance with original                                               
  loan terms                        $       324     $        201     $        70 
Income recognized                            37                9               7 
                                    ------------    -------------   -------------
                                    $       287     $        192     $        63 
                                    ============    =============   =============

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NOTE 4.   LOANS AND ALLOWANCE FOR LOAN LOSSES (Continued)                       

         At December 31, 1994, executive officers and directors, and companies
      in which they have a 10 percent or more beneficial ownership, were
      indebted to the Company in the aggregate amount of $7,233,850. The
      interest rates on these loans were substantially the same as rates
     prevailing at the time of the transaction and repayment terms are
      customary for the type of loan involved. Following is a summary of
transactions:                                               

                                                                [Download Table]

                                                          DECEMBER 31,              
                                             ---------------------------------------
                                                   1994                     1993    
                                             -------------           ---------------
                                                     (DOLLARS IN THOUSANDS)         
                                             ---------------------------------------
                                                                                    
BALANCE, BEGINNING                           $       8,506           $       5,715  
  Advances                                           4,670                   5,683  
  Repayments                                        (4,890)                 (3,119) 
  Transactions due to changes  in directors         (1,052)                    227  
                                             --------------          -------------- 
BALANCE, END OF YEAR                         $       7,234           $       8,506  
                                             ==============          ============== 

Changes in the allowance for loan losses are as follows:    

                                                                [Download Table]

                                                DECEMBER 31,               
                                   ----------------------------------------
                                          1994                     1993    
                                   --------------          ----------------
                                            (DOLLARS IN THOUSANDS)         
                                   ----------------------------------------

                                                                           
BALANCE, BEGINNING OF YEAR         $       3,571           $       4,013   
  Provision charged to operations            638                   1,191   
  Loans charged off                         (971)                 (2,653)  
  Recoveries                                 519                   1,020   
                                   --------------          --------------  
BALANCE, END OF YEAR               $       3,757           $       3,571   
                                   ==============          ==============  

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NOTE 5.   PREMISES AND EQUIPMENT, NET                                           

    Major classifications of these assets are summarized as follows:

                                                                [Download Table]

                                      DECEMBER 31,               
                          ---------------------------------------
                              1994                    1993       
                          ---------------        ----------------
                                  (DOLLARS IN THOUSANDS)         
                          ---------------------------------------

                                                                 
Land                       $       1,564           $      1,522  
Buildings                          5,271                  5,318  
Equipment                          6,223                  4,597  
Construction in progress              -                     137  
                          ---------------         ---------------
                                  13,058                 11,574  
Accumulated depreciation          (5,887)                (5,808) 
                          ---------------         ---------------
                           $       7,171           $      5,766  
                          ===============         ===============

        Depreciation expense for the years ended December 31, 1994, 1993 and
1992 was $738,562, $462,368 and $392,708, respectively.     

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NOTE 6.   LONG-TERM DEBT                                                        

   Long-term debt consisted of the following at December 31, 1993:

                                                                [Download Table]

                                                            (Dollars in
                                                             Thousands)
                                                            -----------
                                                                       
Note payable to Trust Company Bank; interest at the         $       250
 prime interest rate of Trust Company Bank with an                     
 effective interest rate of 5.5% at December 31, 1993;                 
 collateralized by all of the outstanding common stock                 
 of The Citizens Bank of Tifton.                                       
Term loan payable to Trust Company Bank; interest                 3,000
 at Trust Company Bank's prime rate with an                            
 effective rate of 5.5% at December 31, 1993.                          
Revolving credit loan with Trust Company Bank;                    1,412
 interest due at Trust Company Bank's prime rate                       
 with an effective rate of 5.5% at December 31, 1993.                  
Mortgage payable to M.I.A., Co.; due in annual                       15
 instalments of $15,000 with interest at 12%                           
 payable monthly, collateralized by land and buildings.                
                                                            -----------
                                                            $     4,677
                                                            ===========

NOTE 7.   EMPLOYEE BENEFIT PLANS                                                

     The Company and all subsidiaries have adopted simplified employee
          pension plans for substantially all employees. These plans are SEP-IRA
       defined contribution plans. Contributions to these plans charged to
         expense during 1994, 1993 and 1992 amounted to $499,254, $484,870 and
$344,598, respectively.                                     

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NOTE 8.   DEFERRED COMPENSATION PLANS                                           

   The Company and two subsidiary Banks have entered into separate
          deferred compensation arrangements with certain executive officers and
        directors. The plans call for certain amounts payable at retirement,
    death or disability. The estimated present value of the deferred
     compensation is being accrued over the remaining expected term of
          active employment. The Company and Banks have purchased life insurance
          policies which they intend to use to finance this liability. Aggregate
          compensation expense under the plans were $81,295, $83,459 and $75,816
   for 1994, 1993 and 1992, respectively, and is included in other
operating expenses.                                         

NOTE 9.   INCOME TAXES                                                          

          The total income taxes in the consolidated statements of income are as
follows:                                                    

                                                                [Download Table]

                                         December 31,              
                         ------------------------------------------
                            1994             1993            1992  
                         ----------       ---------       ---------
                                   (Dollars in Thousands)          
                         ------------------------------------------

                                                                   
Current                  $   1,262        $    638        $    435 
Deferred                       (22)            176              (6)
                         ----------       ---------       ---------
                         $   1,240        $    814        $    429 
                         ==========       =========       =========

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NOTE 9.   INCOME TAXES (Continued)                                              

     The Company's provision for income taxes differs from the amounts
         computed by applying the Federal income tax statutory rates to income
  before income taxes. A reconciliation of the differences is as
follows:                                                    

                                                        [Enlarge/Download Table]

                                                              December 31,                            
                                 ---------------------------------------------------------------------
                                         1994                     1993                    1992        
                                 ---------------------   ---------------------   ---------------------
                                   Amount     Percent      Amount     Percent      Amount     Percent 
                                 ----------  ---------   ----------  ---------   ----------  ---------
                                                         (Dollars in Thousands)                       
                                 ---------------------------------------------------------------------

                                                                                                      
Tax provision at statutory rate  $   1,475       34 %    $   1,056       34 %    $     651       34 % 
Increase (decrease) resulting                                                                         
  from:                                                                                               
  Tax-exempt interest                 (246)      (6)          (274)      (9)          (277)     (15)  
  Amortization of excess                                                                              
   cost over assets acquired            37        1             49        2             57        3   
  Changes in valuation                                                                                
   allowance for deferred                                                                             
   taxes                               (50)      (1)            -         -             -         -   
  Other                                 24        1            (17)      (1)            (2)       -   
                                 ----------  ---------   ----------  ---------   ----------  ---------
Provision for income taxes       $   1,240       29 %    $     814       26 %    $     429       22 % 
                                 ==========  =========   ==========  =========   ==========  =========

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NOTE 9.   INCOME TAXES (CONTINUED)                                              

       Net deferred income tax assets of $411,710 and $390,006 at December
      31, 1994 and 1993, respectively, are included in other assets. The
components of deferred income taxes are as follows:         

                                                                [Download Table]

                                           DECEMBER 31,        
                                    -------------------------  
                                      1994              1993   
                                    ----------        -------  
                                     (DOLLARS  IN  THOUSANDS)  
                                    -------------------------  

                                                               
DEFERRED TAX ASSETS:                                           
 Loan loss reserves                   $     640      $     592 
 Deferred compensation                      138            122 
 Other real estate                           18             25 
 Other                                       68              7 
 Net operating loss tax carryforward        310            364 
 Less valuation allowance                  (300)          (350)
                                      ----------     ----------
                                            874            760 
                                      ----------     ----------

DEFERRED TAX LIABILITIES:                                      
 Deprecation and amortization              (179)          (144)
 Amortization of intangible assets         (283)          (226)
                                      ----------     ----------
                                           (462)          (370)
                                      ----------     ----------

Net deferred tax assets               $     412       $     390
                                      ==========     ==========

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NOTE 10.  COMMITMENTS AND CONTINGENT LIABILITIES                                

       In the ordinary course of business, the Banks have entered into off
      balance sheet financial instruments which are not reflected in the
consolidated financial statements. These instruments include
       commitments to extend credit, standby letters of credit, guarantees
          and liability for assets held in trust. Such financial instruments are
        recorded in the financial statements when funds are disbursed or the
 instruments become payable. The Banks use the same credit and
         collateral policies for these off balance sheet financial instruments
    as they do for instruments that are recorded in the consolidated
financial statements.                                       

       Following is an analysis of significant off balance sheet financial
instruments.                                                

                                                                [Download Table]

                                             DECEMBER 31,        
                                    -----------------------------
                                       1994               1993   
                                    ----------         ----------
                                       (DOLLARS IN THOUSANDS)    
                                    -----------------------------

                                                                 
Commitments to extend credit        $  22,344          $  20,831 
Standby letters of credit                 590              1,081 
                                    ----------         ----------
                                    $  22,934          $  21,912 
                                    ==========         ==========

          Commitments generally have fixed expiration dates or other termination
          clauses and may require payment of a fee. Since many of the commitment
         amounts expire without being drawn upon, the total commitment amounts
          do not necessarily represent future cash requirements. The credit risk
      involved in issuing these financial instruments is essentially the
        same as that involved in extending loans to customers. The amount of
      collateral obtained, if it is deemed necessary by the Company upon
          extension of credit, is based on management's credit evaluation of the
    customer. Collateral held varies but may include real estate and
        improvements, marketable securities, accounts receivable, inventory,
equipment and personal property.                            

      The Banks do not anticipate any material losses as a result of the
commitments and contingent liabilities.                     

      The nature of the business of the Banks is such that it ordinarily
results in a certain amount of litigation. In the opinion of
     management and counsel for the Company and the Banks, there is no
      litigation in which the outcome will have a material effect on the
consolidated financial statements.                          

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NOTE 11.  CONCENTRATIONS OF CREDIT                                              

       Most of the Banks' loans, commitments and standby letters of credit
         have been granted to customers in the Banks' individual market areas.
       Most of the Banks' loan customers are also depositors of the Banks.
         The Banks' investment portfolios may also include state and municipal
       securities of governmental entities within the Banks' market areas.
      The concentrations of credit by type of loan are also set forth in
         Note 4. Standby letters of credit are granted primarily to commercial
    borrowers of the Banks. The Banks, as a matter of policy, do not
      generally extend credit to any single borrower or group of related
        borrowers in excess of 25% of each Bank's combined capital stock and
capital surplus accounts.                                   

NOTE 12.  STOCKHOLDERS' EQUITY                                                  

      The primary source of funds available to the Parent Company is the
     payment of dividends by the subsidiary Banks. Banking regulations
         limit the amount of dividends that may be paid without prior approval
 of the Banks' regulatory agency. Approximately $1,815,000 are
          available to be paid as dividends by the Bank subsidiaries at December
31, 1994.                                                   

    Banking regulations also require the Company to maintain minimum
       capital levels in relation to Company assets. At December 31, 1994,
  the Company's capital ratios were considered adequate based on
regulatory minimum capital requirements. The minimum capital
          requirements and the actual capital ratios for the Company at December
31, 1994 are as follows:                                    

                                                                [Download Table]

                                       Actual           Regulatory  
                                                        Requirement 
                                    -------------      -------------
                                                                    
Leverage capital ratio                 10.26 %               4.00 % 
Risk based capital ratios:                                          
  Core capital                         15.26                 4.00   
  Total capital                        16.52                 8.00   

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NOTE 13.  DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS                 

        The following methods and assumptions were used to estimate the fair
          value of each class of financial instruments for which it is practical
to estimate that value:                                     

CASH AND SHORT-TERM INVESTMENTS                             

       For cash, due from banks, bank-owned deposits and Federal funds
sold, the carrying amount approximates fair value.      

INVESTMENT SECURITIES                                       

          For debt securities and marketable equity securities held for sale
       and investment purposes, fair values are based on quoted market
        prices. If a quoted market price is not available, fair value is
    estimated using quoted market prices for similar securities.

LOANS                                                       

         For fixed rate commercial and instalment loans, the fair value is
       estimated by discounting the future cash flow using the average
            rates at which similar loans would be made to borrowers with similar
     credit ratings and for the same remaining maturities. For all
      variable rate, equity line and credit card loans, the carrying
amount approximates fair value.                         

DEPOSITS                                                    

           For noninterest-bearing demand, interest-bearing demand and savings
   deposits, fair value is the amount payable on demand at the
        reporting date. The fair value of fixed maturity certificates of
           deposit is estimated by discounting the future cash flows using the
average rate currently offered for similar deposits.    

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NOTE 13.  DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS                 
(CONTINUED)                                                 

COMMITMENTS TO EXTEND CREDIT AND STANDBY LETTERS OF CREDIT  

        Commitments to extend credit and standby letters of credit are not
    recorded until such commitments are funded. The value of these
           commitments are the fees charged to enter into such agreements. These
           commitments do not represent a significant value to the Company until
           such commitments are funded. There has been no fair value assigned to
these instruments.                                        

The carrying value and estimated fair value of the Company's
financial instruments are as follows:                       

                                                                [Download Table]

                                         CARRYING            FAIR   
                                           VALUE             VALUE  
                                         ----------       ----------
                                           (DOLLARS IN THOUSANDS)   
                                         ---------------------------
                                                                    
FINANCIAL ASSETS:                                                   
  Cash and short-term investments        $  20,089        $  20,089 
                                         ==========       ==========

  Investments in securities              $  46,505        $  44,934 
                                         ==========       ==========

  Loans                                  $ 192,124        $ 185,314 
  Allowance for loan losses                 (3,757)              -  
                                         ----------       ----------
        Loans, net                       $ 188,367        $ 185,314 
                                         ==========       ==========

FINANCIAL LIABILITIES:                                              
  Noninterest-bearing demand             $  48,450        $  48,450 
  Interest-bearing demand                   63,262           63,262 
  Savings                                   23,644           23,644 
  Time deposits                            121,513          121,595 
                                         ----------       ----------
        Total deposits                   $ 256,869        $ 256,951 
                                         ==========       ==========

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NOTE 14.  CONDENSED FINANCIAL INFORMATION OF ABC BANCORP                        
(PARENT COMPANY ONLY)                                       

CONDENSED BALANCE SHEETS  
DECEMBER 31, 1994 AND 1993  
(Dollars in Thousands)  

                                                                [Download Table]

                                                      1994        1993   
                                                   ----------  ----------
                                                                         
ASSETS                                                                   
 Cash                                              $   1,307   $     349 
 Interest-bearing deposits in banks                    1,500          -  
 Investment in subsidiaries                           24,461      20,550 
 Other assets                                          3,838       4,215 
                                                   ----------  ----------

        Total assets                               $  31,106   $  25,114 
                                                   ==========  ==========

LIABILITIES                                                              
 Long-term debt                                    $      -    $   4,677 
 Other liabilities                                       656         478 
                                                   ----------  ----------

       Total liabilities                                 656       5,155 
                                                   ----------  ----------

STOCKHOLDERS' EQUITY                                  30,450      19,959 
                                                   ----------  ----------

       Total liabilities and stockholders' equity  $  31,106   $  25,114 
                                                   ==========  ==========

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NOTE 14.  CONDENSED FINANCIAL INFORMATION OF ABC BANCORP                        
(PARENT COMPANY ONLY) (CONTINUED)                           

CONDENSED STATEMENTS OF INCOME  
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992  
(DOLLARS IN THOUSANDS)  

                                                                [Download Table]

                                                     1994        1993        1992   
                                                  ----------  ----------  ----------
                                                                                    
INCOME                                                                              
  Dividends from subsidiaries                     $   1,170   $   1,150   $   2,980 
  Interest                                               84          11          15 
  Fee and rental income                               2,427       1,950       1,751 
  Other income                                           94          32           7 
                                                  ----------  ----------  ----------
         Total income                                 3,775       3,143       4,753 
                                                  ----------  ----------  ----------
EXPENSE                                                                             
  Interest                                              111         193          91 
  Amortization and depreciation                         436         423         411 
  Other expense                                       2,644       1,926       1,745 
                                                  ----------  ----------  ----------
         Total expense                                3,191       2,542       2,247 
                                                  ----------  ----------  ----------

         Income before income taxes (benefits)                                      
           and equity in undistributed earnings                                     
           (distributions in excess of earnings)                                    
           of subsidiaries                              584         601       2,506 

Income taxes (benefits)                                 (55)        147         (42)
                                                  ----------  ----------  ----------

         Income before equity in undistributed                                      
           earnings (distributions in excess of                                     
           earnings) of subsidiaries                    639         454       2,548 

Equity in undistributed earnings                                                    
 (distributions in excess of earnings)                                              
 of subsidiaries                                      2,461       2,184      (1,063)
                                                  ----------  ----------  ----------

         Net income                               $   3,100   $   2,638   $   1,485 
                                                  ==========  ==========  ==========

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NOTE 14.  CONDENSED FINANCIAL INFORMATION OF ABC BANCORP                        
(PARENT COMPANY ONLY) (CONTINUED)                           

CONDENSED STATEMENTS OF CASH FLOWS  
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992  
(DOLLARS IN THOUSANDS)  

                                                        [Enlarge/Download Table]

                                                    1994         1993         1992    
                                                 ----------   ----------   ---------- 
                                                                                      
 CASH FLOWS FROM OPERATING                                                            
  ACTIVITIES                                                                          
  Net income                                      $   3,100    $   2,638    $   1,485 
                                                  ----------   ----------   ----------
  Adjustments to reconcile net income to                                              
   net cash provided by operating activities:                                         
  Depreciation and amortization                         168          144          137 
  Amortization of intangible assets                     268          279          274 
  Distributions in excess of earnings                                                 
   (undistributed earnings) of subsidiaries          (2,461)      (2,184)       1,063 
  Increase in interest receivable                        (6)          -            -  
  Increase (decrease) in taxes payable                   30           19          (77)
  Provision for deferred taxes                            5          204          (10)
  (Increase) decrease in due from                                                     
    subsidiaries                                         45          (49)          -  
  Other prepaids, deferrals and accruals, net            50          (56)         (87)
                                                  ----------   ----------   ----------
         Total adjustments                           (1,901)      (1,643)       1,300 
                                                  ----------   ----------   ----------

         Net cash provided by operating                                               
           activities                                 1,199          995        2,785 
                                                 ----------   ----------   ---------- 

CASH FLOWS FROM INVESTING                                                             
 ACTIVITIES                                                                           
 Increase in interest-bearing deposits in banks     (1,500)          -            -   
 Purchases of premises                                (243)         (22)        (105) 
 Acquisition of subsidiary bank                         -            -        (5,000) 
 Contribution of capital to subsidiary bank         (1,500)          -            -   
                                                 ----------   ----------   ---------- 

         Net cash used in investing activities      (3,243)         (22)      (5,105) 
                                                 ----------   ----------   ---------- 

F-29  

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  

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

NOTE 14.  CONDENSED FINANCIAL INFORMATION OF ABC BANCORP                        
(PARENT COMPANY ONLY) (CONTINUED)                           

CONDENSED STATEMENTS OF CASH FLOWS  
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992  
(DOLLARS IN THOUSANDS)    

                                                                [Download Table]

                                            1994        1993        1992   
                                         ----------  ----------  ----------
                                                                           
CASH FLOWS FROM FINANCING                                                  
 ACTIVITIES                                                                
 Proceeds from long-term debt            $       -   $   1,412   $   3,000 
 Repayment of long-term debt                (4,677)        (15)       (265)
 Proceeds from sale of stock, net of                                       
 stock offering expense                      8,324          -           -  
 Purchase of treasury stock                     -       (1,412)         (8)
 Dividends paid                               (645)       (672)       (726)
                                         ----------  ----------  ----------

       Net cash provided by (used in)                                      
         financing activities                3,002        (687)      2,001 
                                         ----------  ----------  ----------

Net increase (decrease) in cash                958         286        (319)

Cash at beginning of year                      349          63         382 
                                         ----------   ---------  ----------
Cash at end of year                      $   1,307   $     349   $      63 
                                         ==========  ==========  ==========
SUPPLEMENTAL DISCLOSURE OF                                                 
 CASH FLOW INFORMATION                                                     
 Cash paid during the year for interest  $     111   $     193   $      91 

F-30  

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘10KSB’ Filing		Date		First		Last			Other Filings
		7/1/95		10
Filed on:		3/31/95							10QSB
		3/21/95		47		48
		3/1/95		1		23
		1/27/95		52
		1/1/95		6		21
For Period End:		12/31/94		1		81
		12/15/94		63
		9/20/94		46		50
		3/16/94		10
		1/1/94		64
		12/31/93		10		81
		3/30/93		46		50
		3/1/93		20
		1/1/93		52		62
		12/31/92		12		81
		12/19/92		16
		10/1/92		2		63
		1/1/92		64
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