SOUTHERN COMMUNITY BANCORP, SB-2/A, 2000-06-21

SOUTHERN COMMUNITY BANCORP
SB-2/A, 2000-06-21
STATE COMMERCIAL BANKS

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 21, 2000.

REGISTRATION STATEMENT NO. 333-35548

--------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------
AMENDMENT NO. 1
TO
FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------------
SOUTHERN COMMUNITY BANCORP
(Name of Small Business Issuer in its Charter)

Florida 6021 59-3619325
------- ---- ----------
<S> <C> <C>
(State or Jurisdiction of (Primary Standard (I.R.S. Employer
Incorporation or Industrial Identification
Organization) Classification Code Number)
Number)

</TABLE>

250 North Orange Avenue
Orlando, Florida 32801
(407) 648-1844
(Address and Telephone Number of Principal Executive Offices
and Principal Place of Business)
----------------------------
Charlie W. Brinkley, Jr.
Chairman and Chief Executive Officer
Southern Community Bancorp
250 North Orange Avenue
Orlando, Florida 32801
(407) 648-1844
(Name, Address and Telephone Number of Agent for Service)

Copies to:

Rod Jones, Esq. Alfred G. Smith, II, Esq.
Shutts & Bowen LLP Shutts & Bowen LLP
20 North Orange Avenue, Suite 1000 201 S. Biscayne Boulevard, Suite 1500
Orlando, Florida 32801 Miami, Florida 33131
(407) 849-4906 (305) 379-9147
(407) 425-8316 (fax) (305) 381-9982 (fax)

<PAGE> 2

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]

----------------------------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
-------------------------------------------------------------------------------

<PAGE> 3

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES, AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

SUBJECT TO COMPLETION, DATED JUNE 21, 2000.

PROSPECTUS

SOUTHERN COMMUNITY BANCORP

1,050,000 Shares

Common Stock

We are offering a minimum of 200,000 shares, and a maximum of 1,050,000
shares, of our common stock. There is currently no public market for the common
stock, and we do not expect a public market to develop after the offering. The
price to the public in the offering is $16.50 per share. Each subscriber is
required to purchase a minimum of 1,000 shares.

INVESTING IN THE SHARES INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING ON
PAGE 7.

We will deposit all amounts received from each subscriber into one of
two escrow accounts which we have established with SunTrust Bank, as escrow
agent. Each subscriber must designate how much of their subscription we should
deposit in each escrow account. The escrow agent will hold and disburse the
amounts deposited in each escrow account subject to conditions which we have
established. See "Prospectus Summary - Escrow Accounts" on page 3 for a
description of these conditions.

We will not utilize an underwriter to offer the shares. Instead,
certain of our executive officers will offer the shares on our behalf on a "best
efforts" basis. These officers will not receive any commissions or additional
compensation for these efforts.

The initial expiration date of the offering is September 30, 2000.
However, we have the right to extend the expiration date without notice to
subscribers until December 31, 2000. We also have the right to cancel the
offering at any time prior to the release of funds. If we cancel the offering,
the escrow agent will promptly return all funds received from subscribers,
without interest or deduction.

Subscribers may not revoke any subscription for the shares without our
consent. We may accept or reject any subscription offer, in whole or in part, in
our discretion.

<TABLE>

Underwriting Proceeds to Southern
Price to Public Commissions Community Bancorp
--------------- ------------ --------------------
<S> <C> <C> <C>
Per Share ....................... $16.50 None $16.50
Minimum Offering................. $3,300,000.00 None $3,300,000.00
Maximum Offering................. $17,325,000.00 None $17,325,000.00

</TABLE>

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THE DISCLOSURES IN THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.

YOU SHOULD NOTE THAT THE SHARES ARE NOT BANK ACCOUNTS OR DEPOSITS AND ARE NOT
FEDERALLY INSURED BY THE FDIC OR ANY STATE OR FEDERAL AGENCY.

The date of this prospectus is , 2000.

<PAGE> 4

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS.
WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT FROM
THAT CONTAINED IN THIS PROSPECTUS. WE ARE OFFERING TO SELL, AND SEEKING OFFERS
TO BUY, SHARES OF COMMON STOCK ONLY IN JURISDICTIONS WHERE OFFERS AND SALES ARE
PERMITTED. THE INFORMATION CONTAINED IN THIS PROSPECTUS IS ACCURATE ONLY AS OF
THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE TIME OF DELIVERY OF THIS
PROSPECTUS OR OF ANY SALE OF OUR COMMON STOCK. IN THIS PROSPECTUS, "SOUTHERN
COMMUNITY BANCORP," "WE," AND "OUR" REFER TO SOUTHERN COMMUNITY BANCORP, A
FLORIDA CORPORATION.

<PAGE> 5
TABLE OF CONTENTS

PAGE
----

Prospectus Summary.................................................. 1

Risk Factors........................................................ 7

Terms of Offering................................................... 14

Use of Proceeds..................................................... 16

Dilution ........................................................... 17

Capitalization...................................................... 19

Dividend Policy..................................................... 20

Selected Financial Data............................................. 21

Management's Discussion and Analysis of
Results of Operations and Financial Condition ............. 23

Business ........................................................... 40

Supervision And Regulation.......................................... 48

Management.......................................................... 55

Certain Transactions................................................ 66

Securities Ownership of Certain Beneficial Owners and Management.... 68

Description of Capital Stock........................................ 69

Shares Eligible For Future Sale..................................... 72

Legal Matters....................................................... 73

Experts ........................................................... 73

Where You Can Find More Information ................................ 73

Index to Consolidated Financial Statements.......................... F-1

Exhibit A - Subscription Agreement

Exhibit B - Escrow Agreement

<PAGE> 6
PROSPECTUS SUMMARY

YOU SHOULD READ THIS SUMMARY TOGETHER WITH THE MORE DETAILED
INFORMATION AND OUR CONSOLIDATED FINANCIAL STATEMENTS AND ACCOMPANYING NOTES
APPEARING ELSEWHERE IN THIS PROSPECTUS.

SOUTHERN COMMUNITY BANCORP

OUR BUSINESS

Southern Community Bancorp is a recently formed, Florida-based bank
holding company. We currently conduct substantially all of our activities
through Southern Community Bank. This bank commenced banking operations in
December 1998 and currently has a main office and three branches in the Orlando,
Florida area. This bank expects to open an additional branch in Bonita Springs,
Florida in July 2000.

We intend to expand our operations by opening a new bank in Bonita
Springs, Florida in the fall of 2000. The new bank will acquire the assets and
liabilities of the proposed Bonita Springs branch of our existing bank. We
believe that the new bank will be more successful than a branch in attracting
customers in the southwest Florida market because most of the directors and
officers of the new bank will be residents of southwest Florida. We believe that
many customers will be attracted to the new bank by virtue of its local
management.

OUR STRATEGY

Our strategy is to target customers who are dissatisfied with the level
of service delivered by the multi-state banking organizations which have
recently acquired a large percentage of the banking business in Florida.
According to FDIC statistics, the ten largest banks in Florida at June 30, 1999,
controlled 64.7% of total deposits and included just one Florida-based
institution. Five years earlier, at June 30, 1994, the ten largest banks
controlled 55.9% of total deposits and included two Florida- based institutions.
By a different measure, the market share of the three largest banks in Florida
has increased from 40.5% at June 30, 1994 to 50.3% on June 30, 1999. As a result
of this consolidation, we believe that we have the ability to attract owners of
small and medium sized businesses, entrepreneurs, and other professional and
executive customers by providing personalized service and products tailored to
meet the needs of these customers.

As part of our strategy, we will attempt to operate our existing bank,
our proposed new bank, and any banks which we may open or acquire in the future,
in substantially the same manner as local community banks. Accordingly, we
expect that the board of directors and officers of each of our banks will
primarily consist of individuals who live within the communities served by each
bank. Additionally, we anticipate that all of the lending decisions for each
bank will be made by the board of directors and officers of that bank. Each bank
will also seek to become an active participant in the local community by
supporting local charities and civic organizations.

We also expect to realize some of the benefits of larger banking
organizations. For example, we will operate each of our banks on the same data
processing system. Additionally, we will utilize

<PAGE> 7
a single human resources department to handle employee benefits and related
employment matters. We hope to realize the benefits of economies of scale for
these administrative functions.

We may open or acquire additional banks in Florida in the future,
although we have no current plans to do so. If we open or acquire additional
banks, we expect that we would utilize our same strategy for establishing and
growing these banks by emphasizing personalized service and the community bank
aspects of our banks.

OUR EXISTING BANK

Our existing bank, Southern Community Bank, was formed by a group of
Orlando businessmen and bank executives who believed that there was significant
demand for an additional community bank in the Orlando area. Since opening in
December 1998, our existing bank has grown rapidly. As of March 31, 2000, our
existing bank had total assets of approximately $126.3 million. We expect our
existing bank to open a new branch in Bonita Springs, Florida in July 2000, and
to open two additional branches in the Orlando market during the next 18 months.

OUR PROPOSED NEW BANK

We plan to open our proposed new bank, Southern Community Bank of
Southwest Florida, to serve the southwest Florida market, which consists of the
area between Naples and Ft. Myers, Florida. The Florida Department of Banking
and Finance has approved our application to organize the new bank, and the FDIC
is considering our application for deposit insurance. We will apply to the Board
of Governors of the Federal Reserve System to acquire all of the capital stock
of Southern Community Bank of Southwest Florida once the bank's charter is
granted by the Florida Department of Banking and Finance and insurance is
obtained from the FDIC. Assuming that we receive all required regulatory
approvals and the offering is successful, we expect the new bank to commence
operations in the fall of 2000.

Our new bank will acquire the assets and liabilities of the new branch
which our existing bank plans to open in Bonita Springs, Florida in July 2000.
We believe that the opening of this branch will accelerate our ability to grow
the new bank by providing it with a base of personnel, deposits, loans and
customer relationships.

OUR MANAGEMENT TEAM

Our management team includes individuals who have significant
experience serving our target markets. Our chairman and chief executive officer
is Charlie W. Brinkley, Jr., who has more than 21 years of banking experience in
the Central Florida market, including serving as the president of Southern Bank
of Central Florida for 8 years and as the president of Colonial Bank - Florida
for 2 years. Our president and the head of our Orlando bank is John G. Squires,
who also has more than 21 years of experience in the Orlando banking market,
including serving as vice-chairman of Southern Bank of Central Florida for 8
years and as executive vice-president of Colonial Bank - Florida for 2 years.

<PAGE> 8

Our new bank in southwest Florida will be headed by Richard Garner, who
will serve as its chairman and chief executive officer. Mr. Garner has almost 30
years of banking experience in Florida, including more than 9 years in the
southwest Florida market. Mr. Garner previously served as president of First
National Bank of Florida in Bonita Springs and as president of Colonial Bank
Southwest Florida. The president and senior lending officer of the new bank will
be Joel Whittenhall, who has 19 years of banking experience in the southwest
Florida market, including service as the executive vice-president and senior
lending officer of First National Bank of Florida.

ESCROW ACCOUNTS

We have established the first escrow account for the purpose of
capitalizing our proposed new bank, Southern Community Bank of Southwest
Florida. The escrow agent will hold and disburse all of the amounts deposited in
the first escrow account subject to the following conditions:

o The escrow agent will return all of the funds deposited in the first
escrow account to subscribers, without interest or deduction, in the
event that we do not receive subscriptions for at least 610,000 shares
with proceeds designated for the first escrow account prior to the
expiration date of the offering. The initial expiration date of the
offering is September 30, 2000. However, we have the right to extend
the expiration date without notice to subscribers to December 31, 2000.
The proceeds from the sale of 610,000 shares would be $10,065,000.

o If we sell at least 610,000 shares with proceeds designated for the
first escrow account before the expiration date, then the escrow agent
will continue to hold the amounts in the first escrow account until we
have received all required regulatory approvals to open our proposed
new bank. At that time, the escrow agent will release the amounts in
the first escrow account to us, and we will contribute the proceeds to
our proposed new bank.

o After we have received subscriptions for 610,000 shares with proceeds
designated for the first escrow account, we may continue to offer any
unsold shares until the expiration date of the offering. Subscribers to
these shares may continue to designate that we deposit their funds in
the first escrow account. The escrow agent will hold these amounts in
the first escrow account subject to the same conditions as the other
funds deposited in the first escrow account.

o If we do not obtain all required regulatory approvals to open our
proposed new bank by December 31, 2000, then the escrow agent will
return all of the funds deposited in the first escrow account to
subscribers, without interest or deduction.

We have established the second escrow account for the principal purpose
of providing additional working capital for our existing bank, Southern
Community Bank. As described below, it is possible that a portion of the
proceeds in the second escrow account will be reallocated to the

<PAGE> 9
first escrow account. The escrow agent will hold and disburse all of the
subscription funds deposited in the second escrow account subject to the
following conditions:

o If we have not received subscriptions for at least 200,000 shares with
proceeds designated for the second escrow account prior to the
expiration date of the offering, then the escrow agent will return all
of the funds deposited in the second escrow account to subscribers,
without interest or deduction. The proceeds from the sale of 200,000
shares would be $3,300,000.

o If we receive subscriptions for 200,000 shares with proceeds designated
for the second escrow account prior to the expiration date, then the
escrow agent will release the amount of $3,300,000 to us and we will
contribute this amount to our existing bank.

o After we have received subscriptions for 200,000 shares with proceeds
designated for the second escrow account, we may continue to offer any
unsold shares until the expiration date of the offering. Subscribers to
these shares may continue to designate that we deposit their funds in
the second escrow account. The escrow agent will hold these amounts in
the second escrow account until we instruct the escrow agent to either
transfer the funds to the first escrow account or to release the funds
to us. The escrow agent will hold any amounts which are transferred to
the first escrow account on the same conditions as the other funds
deposited in the first escrow account.

If we fulfill the conditions of the release of funds from the first
escrow account, we will complete the sale of shares pursuant to the first escrow
account, even if we do not fulfill the conditions for the release of funds from
the second escrow account. Likewise, if we fulfill the conditions for the
release of funds from the second escrow account but not the first escrow
account, then we will complete the sale of shares pursuant to the second escrow
account.

Each subscriber must designate how much of their subscription funds we
should deposit in each escrow account. However, we have the right to accept or
reject any subscription offer, in whole or in part. Assuming that we accept the
entire subscription offer made by a subscriber, we will deposit the subscriber's
subscription funds in the manner requested by the subscriber. If we do not
accept the entire subscription offer, we will promptly return the portion of the
subscription offer which we did not accept. Additionally, even if a subscriber's
funds are initially deposited in the second escrow account, we have the right to
transfer the subscriber's funds to the first escrow account if we have already
received and accepted subscriptions for 200,000 shares with proceeds designated
to the second escrow account.

We will issue shares to subscribers at the same time as the escrow
agent releases the proceeds from each escrow account to us. As a result,
subscribers may receive shares at different times.

The escrow agent will invest all amounts deposited in escrow in a
money-market mutual fund managed by an affiliate of the escrow agent. We will
retain all interest and other income from the accounts, regardless of whether
the offering is completed or canceled.

<PAGE> 10
REASONS FOR SEPARATE ESCROW ACCOUNTS

We have established two separate escrow accounts to facilitate our goal
of capitalizing our new bank with proceeds received from residents of southwest
Florida. To accomplish this goal, we will encourage subscribers located in
southwest Florida to designate that their subscription proceeds be deposited in
the first escrow account. We believe that these subscribers will increase the
likelihood of the new bank's success because these subscribers are potential
customers and business referral sources for the new bank. We will encourage
subscribers located in central Florida to designate that their subscription
proceeds be deposited in the second escrow account. Although we intend to
encourage subscribers in the manner described above, each subscriber may select
how much of the subscriber's funds we should deposit in each escrow account.

EACH SUBSCRIBER SHOULD BE AWARE THAT THE SUBSCRIBER IS ACQUIRING SHARES
IN OUR HOLDING COMPANY AND NOT ACQUIRING A DIRECT EQUITY INTEREST IN EITHER OUR
EXISTING BANK OR OUR PROPOSED NEW BANK, REGARDLESS OF THE ESCROW ACCOUNT IN
WHICH THE SUBSCRIBER'S FUNDS ARE DEPOSITED.

OUR ADDRESS AND TELEPHONE NUMBER

Our address is 250 N. Orange Avenue, Orlando, Florida, 32801 and our
telephone number is (407) 648-1844.

<PAGE> 11

THE OFFERING

<TABLE>
<CAPTION>
<S> <C>
Securities Offered for Sale: We are offering a minimum of 200,000 shares, and a
maximum of 1,050,000 shares, of our common stock. See
"Description of Capital Stock" for a description of the
shares.

Price to Public: $16.50 per share

Shares to be Outstanding after the We will have a minimum of 1,090,298 shares, and a
Offering: maximum of 1,940,298 shares, outstanding after the
offering.

Use of Proceeds Deposited in the We will utilize the subscription funds from the first escrow
First Escrow Account: account to capitalize our proposed new bank, Southern
Community Bank of Southwest Florida. We will use a
portion of this amount to pay the organizers for the
organizational costs of the new bank, which are estimated at
$500,000. See "Use of Proceeds."

Use of Proceeds Deposited in the We will utilize at least $3,300,000 of the subscription funds
Second Escrow Account: from the second escrow account to increase the working
capital of our existing bank, Southern Community Bank. We have the
right to utilize any subscription funds in excess of $3,300,000 to
either increase the amounts deposited in the first escrow account or
to increase the working capital of our existing bank. See "Use of
Proceeds."

Risk Factors: You should read the "Risk Factors" beginning on page 7
before deciding to invest in our shares.

</TABLE>

<PAGE> 12

RISK FACTORS

AN INVESTMENT IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. YOU
SHOULD CAREFULLY CONSIDER THE RISKS BELOW AND OTHER INFORMATION IN THIS
PROSPECTUS BEFORE DECIDING TO INVEST IN OUR COMMON STOCK.

WE HAVE INCURRED A SUBSTANTIAL LOSS SINCE WE COMMENCED OPERATIONS AND WE MAY
CONTINUE TO INCUR LOSSES IN THE FUTURE.

We commenced banking operations on December 15, 1998. From that date
through March 31, 2000, we had an accumulated deficit of $1,215,000, although we
did have net income of $11,000 in the first three months of 2000. This deficit
is primarily due to the costs of opening our existing bank and establishing its
business, including the opening of three branches. See "Management's Discussion
and Analysis of Financial Condition and Results of Operations."

We expect to incur a loss in 2000 due to the costs of establishing our
new bank in Bonita Springs, Florida and the continuing expansion of our banking
activities in the Orlando market. We may also incur losses in subsequent years
if we are unable to open our new bank, or successfully grow and manage our new
bank and our existing bank. In this regard, a newly formed bank is ordinarily
expected to incur operating losses in its early periods of operations because of
an inability to generate sufficient net interest income to cover operating
expenses. Those operating losses can be significant and can occur for longer
periods than planned depending on the bank's ability to control operating
expenses and generate net interest income. In light of the foregoing, there is a
risk that we may never become profitable.

WE MAY ENCOUNTER UNEXPECTED FINANCIAL AND OPERATING PROBLEMS DUE TO OUR RAPID
GROWTH.

We have grown rapidly since we opened our existing bank in December
1998. As of December 31, 1999, we had total assets of $83.9 million. Our total
assets grew by 50.6%, to $126.3 million, by March 31, 2000. Since opening, we
have expanded to 4 locations, and expect to open at least one more location in
2000, and two more locations in 2001. Our rapid growth may result in unexpected
financial and operating problems, including problems in our loan portfolio due
to their unseasoned nature and problems in our operating procedures and policies
which we have not yet discovered.

IF WE CANNOT OPEN OUR PROPOSED NEW BANK, IT IS LIKELY THAT OUR FUTURE OPERATING
RESULTS WILL BE ADVERSELY AFFECTED.

We have filed applications with the Florida Department of Banking and
the FDIC for permission to open our proposed new bank. The Florida Department of
Banking has approved our application and the FDIC application is pending. We
will also need to file an application with the Federal Reserve to acquire the
shares of this bank. Although we believe that all of these regulatory agencies
will approve our applications, there can be no assurance that they will be
approved. Furthermore, we need to receive subscriptions for at least 610,000
shares with proceeds designated for the first escrow account in order to have
the funds required to capitalize our new bank. If we do

<PAGE> 13

not receive these subscriptions, we will not open the new bank, although we will
continue to operate our proposed branch in Bonita Springs, Florida. If we are
unable to open the new bank for any reason, it is likely that our future
operating results will be adversely affected.

YOU WILL NOT RECEIVE ANY INTEREST ON THE FUNDS DEPOSITED IN ESCROW EVEN IF THE
ESCROW AGENT RETURNS YOUR FUNDS.

We will deposit all funds received from subscribers into the escrow
accounts. Under the terms of these escrow accounts, it is possible that the
escrow agent could hold your funds in escrow until December 31, 2000, and if the
offering is not successful, the escrow agent would return your funds to you. If
the escrow agent returns your subscription funds, you will not receive any
interest on your subscription funds. We will retain all interest and other
income from the escrow accounts, regardless of whether the offering is
consummated or canceled.

WE MAY SELL SHARES TO SUBSCRIBERS WHOSE FUNDS ARE DEPOSITED IN ONE ESCROW
ACCOUNT BUT NOT THE OTHER.

If we fulfill the conditions for the release of funds from either of
the escrow accounts, but not both, we intend to complete the sale of shares to
subscribers whose funds are released. Accordingly, if you deposit funds in an
escrow account in which we fail to fulfill the conditions for release, you would
not receive any shares in the offering, even if we complete the sale of shares
to subscribers whose funds were deposited in the other escrow account.

IF WE CANNOT ATTRACT ADDITIONAL DEPOSITS AND INCREASE OUR CAPITAL, WE WILL NOT
BE ABLE TO GROW.

We plan to significantly increase the level of our assets (including
our loan portfolio). Our ability to increase our assets depends in large part on
our ability to attract additional deposits at competitive rates. We intend to
seek additional deposits by offering deposit products which are competitive with
those offered by other financial institutions in our markets and by establishing
personal relationships with our customers. There can be no assurance that these
efforts will be successful.

Furthermore, our ability to increase our assets depends on our ability
to maintain adequate levels of capital. In this connection, federal and state
banking laws require each of our banks to maintain certain minimum levels of
capital relative to the size of their assets. One of the purposes of the
offering is to provide our existing bank with additional capital in order to
permit further growth. If we do not obtain this additional capital, we would not
be able to grow the existing bank.

We will utilize the proceeds from the first escrow account to
capitalize our new bank to be opened in Bonita Springs. If the offering is
successful, we will contribute a minimum of $10,065,000 to the new bank. This
should permit the new bank to grow significantly. However, our new bank may
eventually encounter capital problems if it grows at the rate we expect.

<PAGE> 14

IF REAL ESTATE VALUES IN THE ORLANDO, FLORIDA AREA DECLINE, OUR LOAN PORTFOLIO
WOULD BE IMPAIRED.

A significant portion of our loan portfolio consists of residential and
commercial mortgages secured by real estate located in the Orlando, Florida
area. Real estate values and real estate markets are generally affected by,
among other things, changes in national, regional or local economic conditions,
fluctuations in interest rates and the availability of loans to potential
purchasers, changes in the tax laws and other governmental statutes, regulations
and policies, and acts of nature. If real estate prices decline in central
Florida, the value of the real estate collateral securing our loans could be
reduced. Such a reduction in the value of our collateral could increase the
number of non-performing loans and adversely affect our financial performance.

WE MAY NOT BE ABLE TO COMPETE WITH OUR LARGER COMPETITORS FOR LARGER CUSTOMERS
BECAUSE OUR LENDING LIMITS WILL BE LOWER THAN THEIRS.

We will be limited in the amount each of our banks can loan a single
borrower by the amount of each bank's capital. The legal lending limit for
secured loans is 25% of capital and surplus. Due to the relatively small size of
our existing bank and our proposed new bank, our lending limits will be
significantly less than those of our competitors. This may adversely affect our
ability to establish lending relationships with larger businesses in our target
markets.

IF ADVERSE ECONOMIC CONDITIONS IN OUR TARGET MARKETS EXIST FOR A PROLONGED
PERIOD, OUR FINANCIAL RESULTS COULD BE ADVERSELY AFFECTED.

Our success will significantly depend upon economic conditions in
central Florida and southwest Florida. A prolonged economic downturn or
recession in these markets could cause our non-performing assets to increase,
which would cause operating losses, impaired liquidity and the erosion of
capital. Such an economic dislocation or recession could result from a variety
of causes, including a prolonged downturn in various industries upon which these
markets depend, or natural disasters such as floods, tornadoes or hurricanes.
Adverse changes in the economy of these areas could have a material adverse
effect on our business, future prospects, financial condition or results of
operations.

WE DO NOT EXPECT TO PAY DIVIDENDS ON OUR COMMON STOCK FOR THE FORESEEABLE
FUTURE.

As a holding company, we will have no significant independent sources
of revenue. Accordingly, our principal source of funds will be cash dividends
and other payments that we receive from our bank subsidiaries. We expect that
our bank subsidiaries will retain their earnings in order to increase their
capital. Furthermore, our bank subsidiaries' ability to pay dividends is
restricted under Federal and state banking law. As a result, we do not
anticipate that we will pay dividends on our common stock in the foreseeable
future.

<PAGE> 15

BECAUSE OUR MANAGEMENT ARBITRARILY DETERMINED THE OFFERING PRICE FOR THE SHARES,
THE OFFERING PRICE MAY EXCEED THE FAIR MARKET VALUE OF OUR SHARES.

Prior to the offering, there was no active trading market in our common
stock. Our Board of Directors arbitrarily determined the offering price without
the assistance of underwriters or other valuation experts. Our Board of
Directors considered our historic and expected growth, and general market
conditions, among other factors, in determining the offering price.
Nevertheless, the offering price bears no relationship to the amount of our
assets, book value, shareholders' equity or other typical criteria of value, and
may exceed the fair market value of our shares and price at which shares may be
sold after the offering. Consequently, you may lose a portion of your investment
simply as a result of an inaccurately determined offering price.

FUTURE SALES OF OUR COMMON STOCK COULD DEPRESS THE PRICE OF OUR COMMON STOCK.

After the offering, the market price of our common stock could be
materially and adversely affected by the sale or the availability for sale of
shares now held by our existing shareholders. After the offering, we will have a
minimum of 1,090,298 shares and a maximum of 1,940,298 shares of common stock
outstanding.

Almost all of the shares which will be outstanding after the offering,
including all of the shares sold in the offering, will be eligible for sale in
the open market without restriction, except for shares held by our "affiliates."
At the present time, our directors and executive officers hold an aggregate of
373,531 shares, and have the right to purchase up to 84,800 additional shares.
Our directors and executive officers have indicated that they will subscribe to
purchase at least 120,000 shares in the offering. Additionally, the persons who
will serve as directors of our new bank have indicated that they will subscribe
to purchase at least 110,000 shares. Following the offering, almost all of the
shares held by these affiliates will be eligible for sale in the public market
subject to compliance with certain volume limitations and other conditions of
Rule 144. Sales of a substantial number of shares of our common stock after this
offering could cause our stock price to fall. In addition, the sale of these
shares could impair our ability to raise capital through the sale of additional
stock.

YOU WILL EXPERIENCE IMMEDIATE AND SUBSTANTIAL DILUTION IN THE NET TANGIBLE BOOK
VALUE OF YOUR SHARES.

Investors purchasing shares of common stock in this offering will incur
immediate and substantial dilution in their shares. If we sell a minimum of
200,000 shares in the offering, then the pro forma book value of one share of
common stock as of March 31, 2000 would have been $13.93, or $2.57 less than the
offering price of $16.50 per share. If we were to sell a maximum of 1,050,000
shares in the offering, then the pro forma book value as of March 31, 2000 would
have been $15.05, or $1.45 less the offering price of $16.50 per share.

<PAGE> 16
WE MAY NEED TO RAISE ADDITIONAL CAPITAL WHICH COULD DILUTE YOUR OWNERSHIP.

We may need to raise additional capital in the future to support our
business, expand our operations, or maintain our minimum capital requirements as
set forth by our applicable bank regulatory agencies. At the present time, we do
expect to sell additional shares of common stock or other equity securities for
at least 12 months. However, we believe that we will need to sell additional
shares after that time in order to support the planned expansion of our banks.
If we do sell additional shares of common stock to raise capital, the sale will
dilute your ownership interest and such dilution could be substantial.

CERTAIN PROVISIONS OF FLORIDA LAW MAY DISCOURAGE OR PREVENT A TAKEOVER OF OUR
COMPANY AND RESULT IN A LOWER MARKET PRICE FOR OUR COMMON STOCK.

Florida law, as well as certain federal regulations, contain certain
anti-takeover provisions that apply to us. While these provisions may provide us
with flexibility in managing our business, they could discourage potential
buyers from seeking to acquire us, even though certain shareholders may wish to
participate in the transaction. These provisions could also adversely affect the
market price of our common stock. See "Description of Capital Stock --
Anti-Takeover Provisions" for a discussion of these anti-takeover provisions.

YOU MAY HAVE DIFFICULTY RESELLING YOUR SHARES BECAUSE IT IS UNLIKELY THAT A
PUBLIC MARKET FOR OUR SHARES WILL DEVELOP AFTER THE OFFERING.

There is no established public market for our common stock and we do
not expect a public market to develop in the future. We do not currently have
any brokers or other persons who make a market in our common stock and we do not
intend to solicit brokers to establish a market in the future. Additionally, we
do not intend to seek the listing of our shares on any securities exchange or
inclusion of our shares on NASDAQ.

The absence of a public market for our shares will make it difficult
for you to resell your shares and is likely to depress the prices which you
would receive from any sale of your shares.

OUR EXECUTIVE OFFICERS AND DIRECTORS WILL CONTINUE TO HAVE SUBSTANTIAL
CONTROL OVER OUR COMPANY AFTER THE OFFERING WHICH COULD DELAY OR PREVENT A
CHANGE OF CONTROL FAVORED BY OUR OTHER SHAREHOLDERS.

Our executive officers and directors, if acting together, would be able
to significantly influence all matters requiring approval by our shareholders,
including election of directors and the approval of mergers or other business
combination transactions. Our executive officers and directors beneficially own
373,531 shares, representing 42% of the total number of shares outstanding as of
March 31, 2000. Our current directors and executive officers, and the persons
who will serve as directors of our new bank, are expected to subscribe to
purchase a minimum of 230,000 shares in the offering. See "Security Ownership of
Certain Beneficial Owners and Management."

<PAGE> 17

The interest of these shareholders may differ from the interests of
other shareholders, and these shareholders, acting together, would be able to
influence significantly all matters requiring approval by shareholders. As a
result, these shareholders could approve or cause us to take actions of which
you disapprove or that are contrary to your interest and those of other
investors.

<PAGE> 18

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

We have made forward-looking statements in this prospectus that are
subject to risks and uncertainties. These forward-looking statements include
information about possible or assumed future results of our operations or
performance after the offering. Also, when we use any of the words "believes,"
"expects," "anticipates," "intends," or "may" or similar expressions, we are
making forward-looking statements. Many possible events or factors could affect
our future financial results, and could cause those results or performances to
differ materially from those expressed in our forward-looking statements. These
possible events or factors include the following:

o legal and regulatory risks and uncertainties;

o economic, political and competitive forces affecting our
businesses, markets, constituencies or securities; and

o the risk that our analyses of these risks and forces could be
incorrect, or that the strategies we have developed to deal
with them may not succeed.

We recognize that all forward-looking statements are necessarily
speculative, speak only as of the date made, and advise potential investors that
various risks and uncertainties, such as those described above, could cause
actual results for future periods to differ materially. Although we believe that
the expectations reflected in such forward-looking statements are reasonable, we
can give no assurance that any expectations will prove to be correct.

<PAGE> 19

TERMS OF OFFERING

We are offering a minimum of 200,000 shares and a maximum of 1,050,000
shares of our common stock at a price of $16.50 per share.

MINIMUM SUBSCRIPTION

Each subscriber must agree to purchase a minimum of 1,000 shares.

PLAN OF DISTRIBUTION

EXPIRATION DATE

The initial expiration date of the offering is September 30, 2000.
However, we have the right to extend the expiration date without notice to
subscribers until December 31, 2000.

ESCROW TERMS

We will deposit all amounts received from each subscriber into one of
two escrow accounts which we have established with SunTrust Bank, as escrow
agent. Each subscriber in the offering must designate how much of their
subscription funds should be deposited in each escrow account.
The escrow agent will hold and disburse the amounts deposited in the escrow
accounts based on conditions which we have established. See "Summary - Escrow
Accounts" on page 4 for a description of the conditions of each escrow account.
A copy of the escrow agreement between us and the escrow agent is attached as
Exhibit A to this prospectus.

ISSUANCE OF SHARES

We will issue shares to subscribers at the same time as the escrow
agent releases the subscription funds from each escrow account to us. As a
result, subscribers may receive shares at different times.

CANCELLATION OF OFFERING

We have the right to cancel the offering at any time prior to the
release of the subscription funds from either of the escrow accounts. If we
cancel the offering, the escrow agent will promptly return all subscription
funds to subscribers, without interest or deduction.

HOW TO SUBSCRIBE

You must take the following steps to subscribe for shares in the
offering:

<PAGE> 20

o You must complete and sign the Subscription Agreement which accompanies
this prospectus. A copy of the Subscription Agreement is attached as
Exhibit B to this prospectus.

o You must make full payment for the purchase price for the shares in
United States currency by check, bank draft or money order payable to
"SunTrust Bank - Southern Community Bancorp Escrow Account."

o You must deliver the executed Subscription Agreement, together with
full payment for the purchase price, in person or by mail, to the
address shown on the Subscription Agreement.

SUBSCRIPTION TERMS

We reserve the right to reject any subscription which is not fully paid
when we receive it. No subscription will be binding until we have accepted it,
and we may refuse to accept any subscription for shares, in whole or in part,
for any reason. In determining which subscriptions to accept, in whole or in
part, we may take into account the order in which we receive subscriptions and a
subscriber's potential to do business with, or to refer customers to, either or
both of the banks. In the event we reject all or part of your subscription
offer, the escrow agent will refund by mail all or the appropriate portion of
the amount paid by you with the subscription offer, without interest, promptly
after the rejection.

If you have any questions about the offering or how to subscribe,
please call Charlie Brinkley or John Squires in Orlando at (407) 648-1844. If
you subscribe, you should retain a copy of the completed subscription documents
for your records.

<PAGE> 21

USE OF PROCEEDS

We will receive a minimum of $3,300,000 and a maximum of $17,325,000 in
proceeds from the offering. We will deposit all subscription funds into one of
two escrow accounts, as designated each by subscriber.

FIRST ESCROW ACCOUNT. If the offering is successful, the first escrow
account will hold a minimum of $10,065,000 in subscription funds from
subscriptions for 610,000 shares. The maximum amount in this escrow account
could be $17,325,000, if we receive subscriptions for all of the shares in the
offering and the subscribers designate that all of their funds be deposited in
the first escrow account. If we receive all regulatory approvals required to
open our proposed new bank, we will contribute these subscription funds to the
new bank as its initial capital, less a pro-rata portion of the offering
expenses. The new bank will initially invest most of these proceeds in
marketable securities. The new bank will liquidate these securities as necessary
to fund loans and to pay its start up and operating expenses. The new bank will
also reimburse its organizers approximately $500,000 for expenses incurred by
them in organizing the new bank, for such items as salaries, administrative
costs, legal fees, accounting fees and application fees.

SECOND ESCROW ACCOUNT. If the offering is successful, the second escrow
account will hold a minimum of $3,300,000 in subscription funds from
subscriptions for 200,000 shares. The maximum number of shares in this escrow
account could be $17,325,000, if we receive subscriptions for all of the shares
in the offering, the subscribers designated that all of their funds be deposited
in the second escrow account and the Board of Directors does not reallocate any
of the proceeds to the first escrow account. We will utilize these proceeds to
make a contribution to our existing bank, less a pro-rata portion of the
offering expenses. The existing bank will initially utilize these proceeds to
purchase marketable securities, which can then be sold to fund loans and
operating expenses.

OFFERING EXPENSES. We will pay the estimated offering expenses of
$100,000 from the proceeds of the offering, prorated between the amounts we
actually receive from each of the escrow accounts.

<PAGE> 22

DILUTION

If you invest in our common stock, your interest will be diluted to the
extent of the difference between the public offering price per share of our
common stock and the pro forma net tangible book value per share of our common
stock after the offering. Pro forma net tangible book value per share represents
the amount of our total tangible assets less total liabilities divided by the
pro forma number of shares of common stock outstanding. As of March 31, 2000,
our net tangible book value, on a pro forma basis as adjusted for the sale of a
minimum of 200,000 shares and a maximum of 1,050,000 shares offered in the
offering, would have been approximately $13.93 per share in the case of a
minimum offering and $15.05 per share in the case of a maximum offering. The
following table illustrates this per share dilution.

<TABLE>
<CAPTION>
Minimum Maximum
Offering Offering
-------- --------
<S> <C> <C>
Offering price per share ................................. $16.50 $16.50
Net book value per share as of March 31, $13.35 $13.35
2000 ....................................................
Increase per share attributable to new $ 0.58 $ 1.70
investors ................................................
Pro forma net book value per share after the
offering ................................................. $13.93 $15.05
Pro forma dilution per share to new investors $ 2.57 $ 1.45
</TABLE>

The following tables summarize on a pro forma basis as of March 31,
2000, the differences between the total consideration paid and the average price
per share paid by the existing shareholders prior to the offering and by new
investors in the offering.

Minimum Offering
(200,000 Shares)

Shares Purchased Total Consideration
--------------------------- --------------------------- Average Price
Number Percent Amount Percent Per Share
------ ------- ------ ------- -------------
<S> <C> <C> <C> <C> <C>
Existing
shareholders 890,298 81.7% $ 13,354,470 80.2% $15.00
======
Investors in
the offering 200,000 18.3% 3,300,000 19.8% $16.50
--------- ------ ------------ ------ ======
Total 1,090,298 100.0% $ 16,654,470 100.0% $15.28
========= ====== ============ ====== ======

</TABLE>

<PAGE> 23

Maximum Offering
(1,050,000 Shares)
Shares Purchased Total Consideration
--------------------------- --------------------------- Average Price
Number Percent Amount Percent Per Share
------ ------- ------ ------- -------------
<S> <C> <C> <C> <C> <C>
Existing
shareholders 890,298 45.9% $ 13,354,470 43.5% $15.00
======
Investors in
the offering 1,050,000 54.1% 17,325,000 56.5% 16.50
--------- ------ ------------ ----- ======
Total 1,940,298 100.0% $ 30,679,470 100.0% $15.81
========= ====== ============ ===== ======

</TABLE>

The information presented above is as of March 31, 2000 and excludes:

- 163,000 shares of our common stock issuable upon the exercise
of outstanding stock options, and

- 13,000 shares reserved for issuance upon the exercise of stock
options which may be granted under our employee stock option
plan.

The issuance of common stock in connection with the exercise of these
options will result in further dilution to new investors. See "Management -
Stock Option Plans" and Note 11 of Notes to Consolidated Statements.

<PAGE> 24

CAPITALIZATION

The following table sets forth our capitalization as of March 31, 2000.
Our capitalization is presented:

o on an actual basis; and

o on an as adjusted basis to give effect to:

o on the sale of a minimum of 200,000 shares in the offering and
the application of the net proceeds from such shares; and

o the sale of a maximum of 1,050,000 shares in the offering and
the application of the net proceeds from such shares.

This table should be read in conjunction with "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and the Financial
Statements included elsewhere in this prospectus.

<TABLE>
<CAPTION>
As of March 31, 2000
--------------------------------------------------------

As Adjusted to As Adjusted to
Give Effect to Give Effect to
Sale of Sale of
Actual 200,000 Shares 1,050,000 Shares
------ -------------- ----------------
(in thousands)
<S> <C> <C> <C>
Shareholders' equity:
Common stock, $1.00 par value;
10,000,000 shares authorized; 890,298 shares
issued and outstanding (actual), 1,090,298 issued
and outstanding (as adjusted for sale of 200,000
shares; 1,940,298 shares issued and outstanding
(as adjusted for sale of 1,050,000 shares) 890 1,090 1,940
Additional paid-in capital 12,464 15,564 28,739
Accumulated deficit and accumulated (1,468) (1,468) (1,468)
-------- -------- --------
other comprehensive (loss)
Total shareholders' equity 11,886 15,186 29,211
-------- -------- --------
Total capitalization $11,886 $15,186 $29,211
======= ======= =======
</TABLE>

The outstanding share information in the table above is as of March 31,
2000 and excludes:

- 163,000 shares of our common stock issuable upon the exercise
of outstanding stock options, and

- 13,000 additional shares reserved for issuance upon the
exercise of stock options which may be granted under the
Company's employee stock option plan.

<PAGE> 25

DIVIDEND POLICY

We have never declared or paid any cash dividends on our common stock, and we
do not intend to pay cash dividends in the foreseeable future. Instead, we
intend to retain any earnings to finance our growth.

We are a legal entity separate and distinct from our subsidiaries.
Substantially all of our revenues and cash flow, including funds available for
other offering expenses, will be in the form of fees which we charge to our
existing bank for management services. Funds available for payment of dividends
would principally consist of dividends paid to us by our banks. Due to the
developmental status of our existing bank, its ability to pay dividends to us is
severely limited. There are also statutory regulatory limitations on the amount
of dividends that may be paid by our existing bank to us. Our ability to receive
dividends from our proposed new bank will be subject to the same limitations.
See "Supervision and Regulation" for a discussion of the regulatory restrictions
on the payment of dividends by our banks to us.

<PAGE> 26

SELECTED FINANCIAL DATA

THE FOLLOWING TABLE SETS FORTH SELECTED CONSOLIDATED FINANCIAL DATA OF
FOR THE PERIOD FROM DECEMBER 15, 1998 TO DECEMBER 31, 1998, THE YEAR ENDED
DECEMBER 31, 1999 AND THE QUARTERS ENDED MARCH 31, 1999, AND MARCH 31, 2000. THE
SELECTED FINANCIAL DATA SHOULD BE READ IN CONJUNCTION WITH "MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS" AND
OUR CONSOLIDATED FINANCIAL STATEMENTS AND NOTES THERETO INCLUDED IN THIS
PROSPECTUS.

The financial condition data as of December 31, 1998, and December 31,
1999, and the operating data for the period from December 15, 1998 to December
31, 1998 and the year ended December 31, 1999 have been derived from our audited
consolidated financial statements included elsewhere in this prospectus, which
have been audited by Hacker, Johnson, Cohen and Greib PA, independent auditors.
The financial condition data as of March 31, 1999 and March 31, 2000 and the
operating data for the three months ended March 31, 1999 and March 31, 2000 have
been derived from our unaudited condensed consolidated financial statements
included elsewhere in this prospectus. The financial condition data as of March
31, 1999 and March 31, 2000, and the operating data for the three months ended
March 31, 1999 and March 31, 2000, have been derived from our unaudited
condensed consolidated financial statements which, in the opinion of management,
have been prepared on the same basis as the audited consolidated financial
statements and reflect all adjustments (consisting of normal recurring
adjustments) necessary for a fair presentation of financial position and
operations. The historical results do not necessarily indicated the results
which you should expect in a future period.

December December March 31, March 31,
31, 1998 31, 1999 1999 2000
-------- -------- --------- ---------
<S> <C> <C> <C> <C>
FINANCIAL CONDITION DATA
(Dollars in thousands)
Assets ............................... $16,606 $83,864 $27,006 $126,267
Securities available for sale......... - $11,998 $3,173 $15,573
Loans receivable, net ................ $1,203 $61,363 $10,327 $78,951
Deposits ............................. $3,274 $65,063 $13,603 $111,041
Stockholders' equity ................. $12,233 $11,838 $12,319 $11,886
Book value per share.................. $14.66 $13.39 $14.35 $13.35
Number of full service
customer facilities 1 4 2 4

</TABLE>

<PAGE> 27

SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>

OPERATING DATA December
(Dollars in thousands) 15, 1998 to Year Ended Three Months Three Months
December December Ended March Ended March
31, 1998 31, 1999 31, 1999 31, 2000
---------------------- ----------- ---------- ------------ ------------
<S> <C> <C> <C> <C>
Interest income .................... $32 $3,399 $360 $1,958
Interest expense ................... 6 1186 67 968
------- ------- ------- --------
Net interest income before
loan loss provision ................ 26 2213 293 990
Provision for loan losses........... 12 609 79 178
------- ------- ------- --------
Net interest income after
loan loss provision ................ 14 1604 214 812
Other income ....................... - 116 2 93
Other expense ...................... 84 3216 624 887
------- ------- ------- --------
Income tax (benefit) (26) (554) (145) 7
provision .......................... ------ ------- ------- --------
Net earnings (loss)................. $(44) $(942) $(263) 11
======= ======= ======= =======
Net earning (loss) per
share, basic and diluted ........... ($0.05) ($1.10) ($0.31) $0.01
======= ======= =======
Total shares outstanding at
end of period....................... 834,425 884,425 858,405 890,298
======= ======= ======= =======
</TABLE>

<PAGE> 28

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION

THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH OUR
CONSOLIDATED FINANCIAL STATEMENTS AND THE RELATED NOTES INCLUDED ELSEWHERE IN
THIS PROSPECTUS.

RESULTS OF OPERATIONS FOR THE PERIOD FROM DECEMBER 15, 1998 TO DECEMBER 31, 1998

Southern Community Bank commenced operations on December 15, 1998. Its
results of operations during the period from December 15, 1998 to December 31,
1998 reflect the start-up nature of its operations. For this 16 day period, we
had a net loss of $44,000, or $.05 per share. Our income consisted of $32,000 in
interest income, which was primarily generated by the bank's investment
portfolio. This amount was offset by $7,000 in interest expense on deposits and
other interest bearing liabilities and a $12,000 provision for loan losses. We
also had $84,000 in non-interest expense, primarily consisting of salary,
occupancy and data processing expenses.

RESULTS OF OPERATIONS - FOR THE YEAR ENDED DECEMBER 31, 1999

We incurred a net loss of $942,000 for the year ended December 31,
1999. Our performance in 1999, our first full year of operations, resulted in a
return on average shareholders' equity of (7.74%). Our results for 1999
continued to reflect the start-up nature of our operations.

During 1999, our total assets and liabilities grew significantly. Total
assets grew from $16.6 million at December 31, 1998 to $83.9 million at December
31, 1999. Total liabilities grew from $4.4 million to $72.0 million during the
same period. The growth in assets and liabilities was primarily the result of
the establishment of three new branch offices in 1999. This expansion has
enabled us to target additional markets and customers.

NET INTEREST INCOME. Our operating results depend primarily on our net
interest income, which is the difference between interest income on
interest-earning assets and interest expense on interest-bearing liabilities,
consisting primarily of deposits. Net interest income is determined by the
difference between yields earned on interest-earning assets and rates paid on
interest-bearing liabilities ("interest-rate spread") and the relative amounts
of interest-earning assets and interest-bearing liabilities. The bank's
interest-rate spread is affected by regulatory, economic and competitive factors
that influence interest rates, loan demand and deposit flows. In addition, the
bank's net earnings are also affected by the level of non-performing loans and
foreclosed real estate, as well as the level of its non-interest income, and its
non-interest expenses, such as salaries and employee benefits and occupancy
expense and income taxes.

The following table sets forth, for the periods indicated, information
regarding:

o the total dollar amount of interest and dividend income from
the bank's interest- earning assets and the resultant average
yields;

<PAGE> 29

o the total dollar amount of interest expense on
interest-bearing liabilities and the resultant average cost;

o net interest/dividend income; interest-rate spread;

o interest margin; and

o ratio of average interest-earning assets to average
interest-bearing liabilities.

<PAGE> 30

YEAR ENDED DECEMBER 31, 1999

Average Interest &
Balance Dividends Yield
------- --------- -----
(Dollars in Thousands)

<S> <C> <C> <C>
Loans................................................... $26,915 $2,716 10.09%
Securities.............................................. $6,088 $398 6.54%
Other interest-earning assets(1)........................ $5,776 $285 4.93%
-------- --------

Total Interest Earnings Assets.......................... $38,779 $3,399 8.77%
-------

Non-interest-earning assets............................. $5,950
--------

Total assets............................................ $44,729
=======

Savings and NOW deposits................................ $3,592 $34 0.95%
Money Market Deposits................................... $9,124 $363 3.98%
Time Deposits........................................... $13,985 $772 5.52%
------- -------
Total Interest-bearing Deposits......................... $26,701 $1,169 4.38%

Other Borrowings........................................ $298 $17 5.70%
---------- --------

Total interest-bearing liabilities...................... $26,999 $1,186 4.39%
-------

Non-interest-bearing deposits........................... $4,766
Non-interest-bearing liabilities........................ $797
Shareholders' Equity.................................... $12,167
--------

Total liabilities and equity............................ $44,729
========

Net Interest Income and Spread(2)....................... $2,213 4.38%
======== =====

Net Interest Margin(3).................................. 5.71%
=====

Average interest-earning assets to
average interest-bearing liabilities................ 1.44
====

</TABLE>

(1) Includes federal funds sold and Federal Home Loan Bank stock.

<PAGE> 31

(2) Represents the difference between average interest-earning assets and
average interest-bearing liabilities.

(3) Represents net interest income divided by average interest-earning
assets.

INTEREST INCOME AND EXPENSE. Interest income in 1999 was $3.4 million
and the weighted average yield on interest-earning assets was 8.77%. Interest
expense was $1.2 million in 1999 and the weighted-average rate paid on
interest-bearing liabilities was 4.39%.

PROVISION FOR LOAN LOSSES. The provision for loan losses totaled
$609,000 in 1999. See "- Allowance and Provision for Loan Losses."

NON-INTEREST INCOME. Non-interest income totaled $116,000 in 1999.
Non-interest income consists of service charges on deposit accounts and other
service charges and fees.

NON-INTEREST EXPENSES. Non-interest expenses for 1999 totaled
$3,216,000. This total was comprised of the following:

Personnel expense (which includes salaries and benefits) totaled
$1,464,000 or 45.5% of total non-interest expenses in 1999. During 1999, we
averaged 25 full time employees, although the number of employees grew to 40 by
December 31, 1999.

Net occupancy expense in 1999 totaled $804,000 or 25.0% of total
non-interest expenses. The principal reason for this total was the establishment
of three branch offices.

Other non-interest expenses for 1999 totaled $947,000 or 29.5% of
total non-interest expenses. Other non-interest expenses include data
processing, printing and office supplies, marketing and advertising,
professional fees and other expenses.

INCOME TAX BENEFIT.

The income tax benefit totaled $554,000 in 1999 as a result of the
Southern Community Bancorp's net operating loss. See Note 9 to the Consolidated
Financial Statements of Southern Community Bancorp for more information
regarding the income tax benefit.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND
MARCH 31, 2000

We had a consolidated net loss of $(263,000) in the first quarter of
1999 compared to net income of $11,000 in the first quarter of 2000. Our results
in the first quarter of 1999 reflected the start-up nature of our operations at
that time. Our results of operations for the first quarter of 2000 reflect our
success in establishing our business in the Orlando market. Results for the
first quarter of 2000 were aided by substantial increase in the level of
interest income due to significant increase in the level of our outstanding
loans. Our net loans grew from $10.3 million at March 31, 1999 to $79.0 million
at March 31, 2000. Results for the first quarter of 2000 were also positively
impacted by a substantial increase in non-interest income (consisting primarily
of services charges on deposit accounts and other services charges and fees).

<PAGE> 32

INTEREST INCOME AND EXPENSE. Interest income in the first quarter of
1999 was $360,000 compared to $1,958,000 in first quarter of 2000. Interest
expense was $67,000 in first quarter of 1999, compared to $968,000 in first
quarter 2000. The increase in these amounts was directly attributable to the
increase in loans, investment securities, and deposit accounts.

PROVISION FOR LOAN LOSSES. The provision for loan losses totaled
$79,000 in first quarter of 1999 and $178,000 in 2000. See "- Allowance and
Provision for Loan Losses."

NON-INTEREST INCOME. Non-interest income totaled $2,000 in first
quarter of 1999 compared to $93,000 in first quarter 2000. Non-interest income
consists of service charges on deposit accounts and other service charges and
fees.

NON-INTEREST EXPENSES. Non-interest expenses for 1999 totaled $624,000
in the first quarter of 1999, and $887,000 in the first quarter of 2000, and was
comprised of the following:

Personnel expense, including salaries and benefits totaled $319,000 or
51.1% of total non-interest expenses in first quarter 1999 and $424,000 or 47.8%
in 2000.

Net occupancy expense in first quarter 1999 totaled $111,000 or 17.8%
of total non-interest expenses and $219,000 or 24.7%in 2000.

Other non-interest expenses for first quarter 1999 totaled $194,000 or
31.1% of total non-interest expenses and $244,000 or 27.5% in 2000. Other
non-interest expenses include data processing, printing and office supplies,
marketing and advertising, professional fees and other expenses.

INCOME TAX PROVISION (BENEFIT). The income tax benefit totaled
$145,000 in first quarter 1999 as a result of our net operating loss, and a
provision of $7,000 in 2000.

CAPITAL EXPENDITURES

Our capital expenditures are reviewed by our Board of Directors. We
make capital expenditures in order to improve our ability to provide quality
services to its customers. Capital expenditures equaled $2,652,000 in 1999, and
$2,002,000 for the first quarter of 2000. These expenditures were principally
related to leasehold improvements and furniture and equipment purchased for
three new banking facilities opened during 1999, and the purchase of two parcels
of land for future branch sites in Bonita Springs and Naples, Florida in 2000.

ASSET QUALITY AND CREDIT RISK

SECURITIES. We maintain a high quality investment portfolio, including
U.S. government agencies and mortgage-backed securities. We believe that these
securities have very little risk of default. At December 31, 1999, and March 31,
2000, all of the securities held in the investment portfolio were rated "A" or
better. All of these securities were classified "available for sale." A rating
of "A" or better means that the bonds are of "upper medium grade, with strong
ability to repay,

<PAGE> 33

possibly with some susceptibility to adverse economic conditions or changing
circumstances." Ratings are assigned by independent rating agencies and are
subject to the accuracy of reported information concerning the issuers and the
subjective judgment and analysis of the rating agencies. They are not a
guarantee of collectibility. At December 31, 1999, approximately 21.4% of these
securities matured in five years or less. As such, we are subject to a
significant risk of fluctuations in market value due to changes in the general
level of interest rates.

The following table sets forth information regarding the composition
of the investment portfolio at December 31, 1999 (amounts in thousands):

Securities of U.S. Government
agencies and corporations $10,058
Mortgage-backed securities 1,940
-------
Total Securities $11,998
=======

LOANS. We maintain a high quality portfolio of real estate, commercial
and consumer loans. All loans over individual lending limits are reviewed and
approved by our loan committee, which ensures that loans comply with applicable
credit standards. In most cases, we require collateral from borrowers. The type
and amount of collateral varies, but may include residential or commercial real
estate, deposits held by financial institutions, U.S. Treasury securities, other
marketable securities and personal property. We monitor collateral values to
ensure that they are maintained at proper levels.

As of December 31, 1999, approximately 63.5% of all our loans were
real estate loans secured by real estate in central Florida. This percentage
increased to 66.1% at March 31, 2000. This level of concentration could present
a potential credit risk because the ultimate collectibility of these loans is
susceptible to adverse changes in real estate market conditions in this market.
We have sought to address this risk by limiting most loans to a maximum of 75%
of the appraised value of the underlying real estate and maximum amortization
schedules of 20 years with balloons not exceeding 5 years.

The following table divides our loan portfolio into four categories.
Most of the loans are short-term and may be renewed or rolled over at maturity.
At that time, we undertake a complete review of the borrower's credit worthiness
and the value of any collateral. If these items are satisfactory, we will
generally renew the loan at prevailing interest rates. In addition to
outstanding loans, we enter into legally binding commitments to extend credit,
letters of credit and unused line of credit. These commitments equaled $30.4
million at December 31, 1999, and $29.6 million at March 31, 2000.

<PAGE> 34

TYPES OF LOANS

<TABLE>

December 31, 1999 March 31, 2000
----------------------------- ------------------------------
Percentage of Percentage of
Amount Total Loans Amount Total Loans
------ ------------- ------ -------------
(Dollars in thousands)
<S> <C> <C> <C> <C>
Commercial........................... $19,122 30.8% $22,671 28.4%
Real estate.......................... 26,451 42.7% 34,699 43.4%
Residential real estate.............. 12,915 20.8% 18,096 22.7%
Consumer and other .................. 3,536 5.7% 4,370 5.5%
Total Loans.......................... $62,024 100.0% $79,836 100.0%
------- ------ ------- ======
Less:
Allowance for loan
losses......................... (621) (799)
Net deferred loan fees......... (40) (86)
--------- --------
Loans receivable, net.......... $61,363 $78,951
======= =======
</TABLE>

The following table sets forth information regarding the maturities of our
loans. For purposes of the table, demand loans are shown as being payable in one
year or less. The entire amount of a balloon loan is treated as maturing in the
year that the balloon payment is due.

<PAGE> 35

MATURITIES OF LOANS BASED ON CONTRACTUAL PRINCIPAL REPAYMENTS

At December 31, 1999
-----------------------------------------------------------------
One Year Over One to Over Five
Total Loans: or Less Five Years Years Total
------------ ------- ---------- ----- -----
(in thousands)
<S> <C> <C> <C> <C>
Commercial............................... $9,619 $5,806 $3,697 $19,122
Commercial real estate................... 5,644 6,087 14,720 26,451
Residential real estate.................. 9,362 2,341 1,212 12,915
Consumer and other....................... 1,484 1,965 87 3,536
------- ------- ------- -------
Total.................................... $26,109 $16,199 $19,716 $62,024
======= ======= ======= =======

</TABLE>

Of the $35.9 million in loans due after one year, 59.3% have fixed
interest rates and 40.7% have adjustable rates.

COMMERCIAL LOANS. We make commercial loans primarily to businesses
located in central Florida. The credit risk associated with business lending is
influenced by general economic conditions, deterioration in a borrower's capital
position resulting in increasing debt to equity ratios, deterioration in a
borrower's cash position resulting in a liquidity problem, and decreasing
revenues due to inefficient operations of the borrower. These loans are
generally secured by corporate assets, marketable securities or other liquid
financial instruments. These loans totaled $19.1 million or 30.8% of total loans
at December 31, 1999 and $22.7 million or 28.4% of total loans at March 31,
2000.

REAL ESTATE LOANS. We make real estate loans from time to time for real
estate projects located in central Florida. The bank generally requires security
in the form of a mortgage on the underlying real property and the improvements
constructed thereon and personal guarantees. We attempt to limit our credit
exposure to 75% of the appraised value of the underlying real property. These
real estate loans totaled $39.4 million or 63.5% of total loans at December 31,
1999, and $52.8 million or 66.1% of total loans at March 31, 2000. Risks
associated with real estate loans include variations from vacancy projections,
delays in construction, environmental factors, reliability of subcontractors and
timing and reliability of inspections, and costs overruns.

We make real estate loans secured by commercial real estate, including
loans to acquire or refinance office buildings, warehouses and apartments. These
loans totaled $26.5 million or 42.7% of total loans at December 31, 1999 and
$34.7 million or 43.4% of total loans at March 31, 2000. Most of these loans
have a maturity of five years or less. Almost all of these loans are secured by

<PAGE> 36

real property located in central Florida. These loans generally require a
loan-to-collateral value of not more than 75%.

Residential real estate loans totaled $12.9 million or 20.8% of total
loans at December 31, 1999 and $18.1 million, or 22.7% of total loans at March
31, 2000. Residential real estate loans are predominately adjustable rate home
mortgages which generally require a loan-to-collateral value of not more than
90% and equity credit lines which generally limit the loan-to-collateral value
to not more than 90%. Most loans have a maximum term of five years. Almost all
of the residential real estate loans are secured by homes in central Florida.

CONSUMER LOANS AND OTHER. We offer consumer loans and personal and
secured loans. The security for these loans ordinarily consists of automobiles,
consumer goods, marketable securities, certificates of deposit and similar
items. These loans totaled $3.5 million or 5.7% of total loans at December 31,
1999 and $4.4 million or 5.5% of total loans at March 31, 2000. Risks associated
with installment loans include loss of employment of borrowers, declines in the
financial condition of borrowers resulting in delinquencies, and rapid
depreciation of loan collateral.

NON-PERFORMING ASSETS AND PAST DUE LOANS

Non-performing assets consist of non-accrual loans and residential and
commercial properties acquired in partial or total satisfaction of problem loans
which are known as "other real estate owned" or "OREO." Past due loans are loans
that are delinquent 30 days or more which are still accruing interest.

Maintaining a low level of non-performing assets is important to the
on-going success of any financial institution. Our credit review and approval
process is critical to its ability to minimize non-performing assets on a
long-term basis. In addition to the negative impact on interest income,
non-performing assets also increase operating costs due to the expense of
collection efforts. It is our policy to place all loans which are past due 90
days or more on non-accrual status, subject to exceptions made on a case by case
basis. As of December 31, 1999, and March 31, 2000, we had no such loans.

ALLOWANCE AND PROVISION FOR LOAN LOSSES

We evaluate the adequacy of our allowance for loan losses as part of
our on-going credit review and approval process. The review process is intended
to identify, as early as possible, customers who may be facing financial
difficulties. Once identified, the extent of the client's financial difficulty
is carefully monitored by our credit administrator, who recommends to the
directors' loan committee the portion of any credit that needs a specific
reserve allocation or should be charged off. Other factors considered by the
loan committee in evaluating the adequacy of the allowance include overall loan
volume, historical net loan loss experience, the level and composition of
nonaccrual and past due loans, local economic conditions, and value of any
collateral. From time to time, specific amounts of the reserve are designated
for certain loans in connection with the loan review officer's analysis of the
adequacy of the allowance for loan losses.

<PAGE> 37

While a portion of this allowance is typically intended to cover
specific loan losses, it is considered a general reserve which is available for
all credit-related purposes. The allowance is not a precise amount, but is
derived based upon the above factors and represents management's best estimate
of the amount necessary to adequately cover probable losses from current credit
exposures. The provision for loan losses is a charge against current earnings
and is determined by management as the amount needed to maintain an adequate
allowance.

We believe that the overall credit quality of our loan portfolio is
strong, as evidenced by the fact that we have had no non-performing loans or
charge-offs through March 31, 2000. The lack of non-performing loans and
charge-offs may be due, in large part, to our relatively short operating
history. We expect that we will have non-performing loans and charge-offs in the
future as our loan portfolio matures. However, we believe that our allowance for
loan losses will be sufficient to absorb these loan losses. To date, we have
sought to maintain our allowance for loan losses at approximately 1% of total
loans, or $621,000 at December 31, 1999 and $799,000 at March 31, 2000.

The following table further summarizes the allocation of the allowance
for loan losses by type of loan at December 31, 1999 and March 31, 2000.

ALLOCATION OF ALLOWANCE FOR LOAN LOSSES

<TABLE>

December 31, 1999 March 31,2000
------------------------ -------------------------
Percentage of Percentage of
Amount Total Loans Amount Total Loans
------ ----------- ------ -----------
(Dollars in thousands)
<S> <C> <C> <C> <C>
Commercial $191 30.8% $227 28.4%
Commercial
Real Estate 265 42.7% 347 43.4%
Residential Real
Estate 64 20.8% 91 22.7%
Consumer loans
and other 71 5.7% 87 5.5%
Unallocated
general reserves 30 - 47 -
---- -- --- --
Total allowance
for loan losses $621 100.0% $799 100.0%
==== ====== ==== ======

</TABLE>

<PAGE> 38
The following table displays loan originations by type of loan and
principal reductions during the year ended December 31, 1999 and the three
months ended March 31, 2000.

For the Three
For the Year Ended Months Ended
December 31, 1999 March 31, 2000
----------------- --------------
(in thousands)
<S> <C> <C>
Originations:
Commercial loans............................ $27,708 $ 7,667
Commercial real estate loans................ 38,413 11,423
Residential real estate loans............... 18,712 10,584
Consumer loans and other.................... 5,128 1,751
-------- -------

Total loans originated............. 89,961 31,425

Principal reductions........................ (29,151) (13,613)
-------- -------

Increase in gross loans............ $ 60,810 $17,812
======== =======
</TABLE>

FINANCIAL CONDITION

Our goal is to maintain a high quality and liquid balance sheet. We
seek to achieve this objective through a high quality portfolio of investment
securities with short to medium term maturities, and a high quality portfolio of
real estate, commercial and consumer loans. To date, we have not experienced any
loan losses primarily due to our short operating history. We expect that our
level of loan losses will increase in the future as our loan portfolio matures.
However, we believe that our allowance for loan losses will be sufficient to
absorb these loan losses.

SECURITIES. In 1999, securities averaged $6.1 million or 15.7% of total
earning assets. Our strategy for its investment account is to maintain a very
high quality portfolio with generally short-to medium-term maturities.
Securities where $12.0 million at December 31, 1999, and $15.6 million at March
31, 2000. The growth in securities reflects overall increase in the size of our
existing bank. The following tables sets forth information regarding the
investment portfolio at December 31, 1999.

<PAGE> 39

REMAINING MATURITY AND AVERAGE YIELD OF INVESTMENT SECURITIES AT
DECEMBER 31, 1999

<TABLE>
<CAPTION>
One to Five Five to Ten
Years Years Total
--------------------- ---------------------- -----------------------
Carrying Carrying Carrying
Value Yield Value Yield Value Yield
-------- ----- -------- ----- -------- -----
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Securities of U.S.
government agencies
and corporations........... $2,565 5.52% $7,493 7.04% $10,058 6.71%
Mortgage-backed
securities................. - -- 1,940 6.56% 1,940 6.56%
--------- ------- ---------
Total................ $2,565 5.52% $9,433 6.95% $11,998 6.70%
====== ====== =======
</TABLE>

LOANS. Loans averaged $26.9 million in 1999. Loans grew from $1.2
million at December 31, 1998 to $61.4 million at December 31, 1999, and to $79.0
million at March 31, 2000. This growth reflects the success of our marketing
efforts in the Orlando area. See " -Asset Quality and Credit Risk - Loans."

DEPOSITS AND INTEREST-BEARING LIABILITIES. Interest-bearing liabilities
primarily consist of deposits and federal funds purchased. Total
interest-bearing liabilities increased from $3.3 million at December 31, 1998 to
$60.3 million at December 31, 1999 and to $97.0 million at March 31, 2000. The
growth in our deposit portfolio, particularly during the first quarter of 2000,
was attributable to a campaign of seeking additional deposits by offering
relatively attractive rates on our deposit products. Total interest-bearing
liabilities averaged $27.0 million in 1999.

The following table sets forth information regarding our average
deposits for 1999.

AVERAGE DEPOSITS 1999

Amount Average Rate
------ -------------
(in thousands)
<S> <C>
Demand deposits - non-interest bearing........................ $4,766 -
Savings and NOW accounts...................................... 3,592 0.95%
Money market accounts......................................... 9,124 3.98%
Time deposits................................................. 13,985 5.52%
------
Total deposits................................................ $31,467 3.72%
=======

</TABLE>

<PAGE> 40
The following table summarizes the maturity of time deposits over
$100,000 at December 31, 1999.

SUMMARY OF TIME DEPOSITS OVER $100,000 BY MATURITY

(in thousands)

December 31, 1999
-----------------

Three months or less..................................... $9,047
Three to Six months...................................... 1,956
Six to Twelve months..................................... 2,106
Over Twelve months....................................... 6,219
-------
Total.......................................... $19,328
=======

The following table sets forth the net deposit flows during the year
ended December 31, 1999 (in thousands):

Net increase before interest credited $60,985
Net credited 804
-------
Net deposit increase $61,789
=======

LIQUIDITY AND RATE SENSITIVITY

The principal functions of asset and liability management are to
provide for adequate liquidity, to manage interest rate exposure by maintaining
a prudent relationship between rate sensitive assets and liabilities and to
manage the size and composition of the balance sheet so as to maximize net
interest income.

Liquidity is the ability to provide funds at minimal cost to meet
fluctuating deposit withdrawals or loan demand. These demands are met by
maturing assets and the capacity to raise funds from internal and external
sources. We primarily utilize cash and federal funds sold to meet our liquidity
needs. Although not utilized in managing daily liquidity needs, the sale of
investment securities provides a secondary source of liquidity.

Fluctuating interest rates, increased competition and changes in the
regulatory environment continue to significantly affect the importance of
interest-rate sensitivity management. Rate sensitivity arises when interest
rates on assets change in a different period of time or a different proportion
than that of interest rates on liabilities. The primary objective of
interest-rate sensitivity management is to prudently structure the balance sheet
so that movements of interest rates on assets and liabilities are highly
correlated and produce a reasonable net interest margin even in periods of
volatile interest rates.

Regular monitoring of assets and liabilities that are rate sensitive
within 90 days, one year and three years is an integral part of our
rate-sensitivity management process. It is our policy to maintain a reasonable
balance of rate-sensitive assets and liabilities on a cumulative one-year basis,

<PAGE> 41

thus minimizing net interest income exposure to changes in interest rates. A
ratio of 1.0 represents perfect matching of interest-earning assets and
interest-bearing liabilities. Our sensitivity position at December 31, 1999 was
such that net interest income would decrease modestly if there were an increase
in short-term interest rates.

We monitor the interest rate risk sensitivity with traditional gap
measurements. The gap table has certain limitations in its ability to accurately
portray interest sensitivity; however, it does provide a static reading of our
interest rate risk exposure.

The following table shows the repricing structure of our balance sheet
at December 31, 1999 with each maturity interval referring to the earliest
repricing opportunity for each asset and liability. The earliest repricing
opportunity is the earlier of scheduled contractual maturities or the next reset
date. As of that date, we were liability sensitive. Liability sensitive means
interest sensitive liabilities subject to repricing exceeded interest sensitive
assets subject to repricing on a 365-day basis to the extent of $16.5 million.
This negative gap at December 31, 1999 was 19.67% of total assets. We targeted
gap position is in the range of negative 20 percent to positive 20 percent. We
measure our gap position as a percentage of our total assets.

<PAGE> 42

INTEREST RATE SENSITIVITY & GAP REPORT
DECEMBER 31, 1999
(Dollars in Thousands)

Over 3 Yrs.
3 Mos. 3 Mos. Over 1 Yr. to Over 5
or Less to Yr. to 3 Yrs. 5Yrs. Yrs. Total
------- ------ --------- ----- ---- -----
<S> <C> <C> <C> <C> <C> <C>
Assets:
Loans(1)................... $28,578 $8,414 $6,372 $9,497 $9,163 $62,024
Securities................. -- -- -- $2,565 $9,433 $11,998
Other Interest-earning
------- ------ ------ ------- ------- -------
assets(2)..................
Total Interest-bearing
assets..................... $212 -- -- -- -- $212
========= ========= ========== ======= ======= =======
Interest-bearing
Liabilities:
Savings and NOW
deposits(3)................ $5,757 -- -- -- -- $5,757
Money-market
deposits(3)................ $14,052 -- -- -- -- $14,052
Time deposits(3)........... $19,582 $8,308 $6,569 $26 -- $34,485
Other Borrowings........... $6,000 -- -- -- -- $6,000
------- ------ ------ ------- ------- -------
Total Interest-bearing
Liabilities................ $45,391 $8,308 $6,569 $26 -- $60,294
========= ========= ========== ======= ======= =======
GAP........................ ($16,601) $106 ($197) $12,036 $18,596 $13,940
========= ========= ========== ======= ======= =======
Cumulative GAP............. ($16,601) ($16,495) ($16,692) ($4,656) $13,940
========= ========= ========== ======= =======
Ratio of interest-earning
assets to interest-
bearing liabilities........ .63 1.01 .97 463.92 N/A 1.23
========= ========= ========== ======= ======= =======
Cumulative ratio of
interest-earning assets
to interest-bearing
liabilities................ .63 .69 .72 .92 1.23
========= ========= ========== ======= =======
Cumulative GAP to
Total Assets............... (19.80)% (19.67)% (19.90)% (5.55)% 16.62%
========= ========= ========== ======= =======

</TABLE>

<PAGE> 43

(1) In preparing the above table, adjustable-rate loans are included in the
period in which the interest rates are next scheduled to adjust rather
than in the period in which the loans mature. Fixed-rate loans are
scheduled, including repayment, according to their maturities.

(2) Includes Federal Home Loan Bank Stock, which reprices quarterly.

(3) Savings, NOW and money-market deposits are regarded as readily
accessible withdrawable accounts. Time deposits are scheduled according
to their respective maturity dates.

CAPITAL

One of our primary objectives is to maintain a strong capital position
to merit the confidence of customers, bank regulators and shareholders. A strong
capital position helps us withstand unforeseen adverse developments and take
advantage of attractive lending and investment opportunities when they raise.

Under the Federal Reserve's rules pertaining to risk-based capital, our
existing bank's ratio of tier one capital to risk-weighted assets was 16.6% at
December 31, 1999 and 12.4% at March 31, 2000, and the ratio of total capital to
risk-weighted assets was 17.5% at December 31, 1999 and 13.2% at March 31, 2000.
These risk-based capital ratios are well in excess of the minimum requirements
of 4% for tier one and 8% for total risk-based capital ratios established by the
federal regulations.

Our leverage ratio (tier one capital to total average adjusted
quarterly assets) of 15.5% at December 31, 1999 and 11.9% at March 31, 2000 were
also well in excess of the minimum 4% requirement.

The following table sets forth our required and actual capital amounts
and percentages at December 31,1999 (dollars in thousands):

Actual Required
Amount % Amount %
------ - -------- -
<S> <C> <C> <C> <C>
Tier 1 Capital
(to Risk-Weighted $11,551 16.6% $2,776 4.0%
Assets)
Total Capital
(to Risk-Weighted $12,172 17.5% $5,551 8.0%
Assets)
Tier 1 Capital
(to Total Assets) $11,551 15.5% $2,972 4.0%

</TABLE>

<PAGE> 44

IMPACT OF INFLATION AND CHANGING PRICES

The financial statements and related data presented herein have been
prepared in accordance with GAAP, which requires the measurement of financial
position and operating results in terms of historical dollars, without
considering changes in the relative purchasing power of money over time due to
inflation. Unlike most industrial companies, substantially all of our assets and
liabilities of are monetary in nature. As a result, interest rates have a more
significant impact on our performance than the effects of general levels of
inflation. Interest rates do not necessarily move in the same direction or in
the same magnitude as the prices of goods and services, since such prices are
affected by inflation to a larger extent than interest rates.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the risk of loss from adverse changes in market prices
and rates. Our market risk arises primarily from interest rate risk inherent in
our lending and deposit taking activities. We have little or no risk related to
trading account, commodities or foreign exchange.

We actively monitor and manage our interest rate risk exposure. The
primary objective in managing interest-rate risk is to limit, within established
guidelines, the adverse impact of changes in interest rates on our net interest
income and capital, while adjusting our asset-liability structure to obtain the
maximum yield-cost spread on that structure. Management relies primarily on its
asset-liability structure to control interest rate risk. However, a sudden and
substantial increase in interest rates could adversely impact our earnings, to
the extent that the interest rates borne by assets and liabilities do not change
at the same speed, to the same extent, or on the same basis. There have been no
significant changes in our market risk exposure since December 31, 1999.

FUTURE ACCOUNTING REQUIREMENTS

Financial Accounting Standards 133 - ACCOUNTING FOR DERIVATIVE
INVESTMENTS AND HEDGING ACTIVITIES - requires companies to record derivatives on
the balance sheet as assets or liabilities, measured at fair value. Gains or
losses resulting from changes in the values of those derivatives would be
accounted for depending on the use of the derivatives and whether they qualify
for hedge accounting. The key criterion for hedge accounting is that the hedging
relationship must be highly effective in achieving offsetting changes in fair
value or cash flows. We will be required to adopt this Statement effective
January 1, 2001. We do not anticipate that this Statement will have a material
impact on us.

<PAGE> 45

BUSINESS

GENERAL

Southern Community Bancorp is a bank holding company which owns and
operates Southern Community Bank, a Florida bank based in Orlando, Florida. We
became a bank holding company on July 30, 1999 when we acquired all of the
shares of Southern Community Bank in a share exchange with the shareholders of
the bank.

We are in the process of establishing a new Florida bank, Southern
Community Bank of Southwest Florida, which will be based in Bonita Springs,
Florida. The opening of the new bank is contingent upon the approval of the
Florida Department of Banking and Finance, the FDIC, the Federal Reserve and the
success of the offering of our shares.

STRATEGY

Our goal is to operate our existing bank and our new bank in the
substantially the same manner as local community banks, emphasizing local
leadership and local decision-making. The management of each bank will make its
own credit decisions. Each bank will price and market its own loan and deposit
products. Each bank will have its own board of directors, drawn mainly from
members of the local business community. Each board will have full authority
over the bank, in contrast to an "advisory" board which lacks authority. Each
bank will endeavor to be an active supporter of local charities and civic
organizations.

Our strategy is to capitalize on the opportunities created by the
recent consolidation in the Florida banking industry. We believe that this
consolidation has reduced the levels of personalized services as the larger
regional financial institutions have increasingly focused on larger corporate
customers, standardized loan and deposit products and other services. More
specifically, many financial institutions have centralized their loan approval
practices for small businesses, leaving less responsibility and authority with
the traditional loan officer. By virtue of their banking experience in Florida,
management believes that the most frequent customer complaints are based on a
lack of personalized service and turnover in lending personnel, which limits the
customer's ability to develop a relationship with his or her banker. As a result
of these factors, we believe there currently exists a significant opportunity to
attract and maintain customers who are dissatisfied with their banks. We also
believe we can attract experienced management personnel within our identified
markets.

Our holding company structure provides flexibility for the future
expansion of our banking business through the possible acquisition of other
financial institutions and the formation of new banks. In addition, our holding
company structure also makes it easier to raise additional capital for our banks
because we can issue securities without the need for prior banking regulatory
approval. Any such acquisitions will be subject to regulatory approvals and
other requirements. See "Supervision and Regulation."

SOUTHERN COMMUNITY BANK

We currently conduct substantially all of our activities through
Southern Community Bank. Southern Community Bank is a Florida state-chartered
bank which commenced operations in

<PAGE> 46

December 1998. The bank seeks to emphasize the needs of individuals and small to
medium-sized businesses who desire high levels of personalized attention and
customer service. Southern Community Bank's principal office is located in the
central business district in Orlando, Florida, and it maintains branch offices
in the cities of Winter Park, Altamonte Springs and Longwood, Florida. All of
these offices are located within less than one mile of Interstate Highway 4,
which provides access from most communities located in the northern portion of
the Orlando metropolitan area. The bank intends to establish two additional
branch offices in central Florida within the next 12 to 18 months, one to be
located in the southwest Orlando area and the other to be located in the
vicinity of Lake Mary, Seminole County. The opening of these branches is subject
to the receipt of required regulatory approvals. At March 31, 2000, the bank had
total assets of approximately $126.3 million.

The bank has recently received regulatory approval to establish a
branch office in Bonita Springs in Lee County, Florida. This branch office will
be located at the site where we proposed to open the main office of Southern
Community Bank of Southwest Florida. Our existing bank will operate this office
as a branch office until our new bank commences operations. At that time, we
will transfer this office, and all related personnel, assets and liabilities, to
the new bank. We believe that the opening of the Bonita Springs branch office
will accelerate the growth of our new bank by providing the new bank with an
established facility, personnel and customer relationships.

SOUTHERN COMMUNITY BANK OF SOUTHWEST FLORIDA

We are in the process of forming a new bank, Southern Community Bank of
Southwest Florida, which will serve the Bonita Springs market. We currently plan
to open the new bank in the fall of 2000. The opening of the new bank will
depend on our ability to receive subscriptions for at least 610,000 shares with
proceeds designated to the first escrow account, and compliance with any
conditions imposed by the Florida Department of Banking and Finance, the Federal
Reserve and the FDIC. These conditions are generally designed to ensure that a
new bank has sufficient resources to begin its banking operations in a safe and
sound manner.

We expect that construction of the new bank's main office building will
commence in September 2000 and be completed early in 2001. Pending the
completion of the permanent facility, we expect the new bank to conduct
operations in a temporary modular facility to be located at this site.

Our existing bank purchased a site in North Naples, Collier County,
Florida, which will be used as an additional branch office of the new bank. Our
existing bank will contribute this property to our new bank upon its opening.

SOUTHERN COMMUNITY INSURANCE AGENCY, INC.

We recently formed Southern Community Insurance Agency, Inc., a Florida
corporation, as a wholly owned subsidiary of our existing bank. Southern
Community Insurance Agency, Inc. refers customers of our banks to another
insurance agency, Insurance Office of America, Inc., for the purchase of
insurance products. Insurance Office of America, Inc. will pay us a percentage
of the commissions generated from customers which we refer. Insurance Office of
America, Inc. is

<PAGE> 47

owned by one of our directors, John Ritenour. Our subsidiary has also entered
into a similar arrangement with Chicago Title Insurance Company.

PRODUCTS AND SERVICES

We offer a broad array of traditional banking products and services to
our customers, including the products and services described below.

DEPOSITS. We offer a full range of interest bearing and non-interest
bearing accounts, including commercial and retail checking accounts, money
market accounts, individual retirement accounts, savings accounts, and other
time deposits of various types, ranging from daily money market accounts to
longer term certificates of deposit. We have tailored the rates and terms of our
accounts and time deposits to compete with the rates and terms in our principal
markets. We seek deposits from residents, businesses and employees of businesses
in these markets. The FDIC insures all of our accounts up to the maximum amount
permitted by law. In addition, we receive service charges which are competitive
with other financial institutions in our markets, covering such matters as
maintenance fees on checking accounts, per item processing fees on checking
accounts, returned check charges and other similar fees.

LENDING ACTIVITIES. We use our deposits, together with borrowings and
other sources of funds, to originate and purchase loans. We offer a full range
of short and medium-term small business and commercial, consumer and real estate
loans. We generally seek to allocate our loan portfolio as follows: 80% to real
estate loans; 15% to small business and commercial loans; and 5% to consumer
loans. We have a loan approval process which provides for various levels of
officer lending authority. When a loan amount exceeds an officer's lending
authority, it is reviewed by the loan committee of the bank's board of directors
which has ultimate lending authority.

The risk of non-payment of loans is inherent in all loans. However, we
carefully evaluate all loan applicants and attempt to minimize our credit risk
exposure by use of thorough loan application and approval procedures that we
have established for each category of loan. In determining whether to make a
loan, we consider the borrower's credit history, analyze the borrower's income
and ability to service the loan, and evaluate the need for collateral to secure
recovery in the event of default. We maintain an allowance for loan losses based
upon assumptions and judgments regarding the ultimate collectibility of loans in
their portfolio and a percentage of the outstanding balances of specific loans
when their ultimate collectibility is considered questionable.

We direct our lending activities primarily to individuals and
businesses in our markets whose demand for funds fall within the bank's legal
lending limits and are also potential deposit customers. The following is a
description of each of the major categories of loans which we make:

COMMERCIAL LOANS. This category includes loans made to individuals,
partnerships or corporate borrowers for a variety of business purposes. We place
particular emphasis on loans to small to medium-sized professional firms, retail
and wholesale businesses, light industry and manufacturing concerns operating in
our markets. We consider "small businesses" to include commercial, professional
and retail businesses with annual gross sales of less than $20 million or annual
operating costs of less than $5 million. Our commercial loans include term loans
with

<PAGE> 48

variable interest rates secured by equipment, inventory, receivables and real
estate, as well as secured and unsecured working capital lines of credit. Risks
of these types of loans depend on the general business conditions of the local
economy and the borrower's ability to sell its products and services in order to
generate sufficient business profits to repay the loan under the agreed upon
terms and conditions. Personal guarantees may be obtained from the principals of
business borrowers and third parties to further support the borrower's ability
to service the debt and reduce the risk of non-payment.

CONSUMER AND INSTALLMENT LOANS. Consumer loans include lines of credit
and term loans secured by second mortgages on the residences of borrowers for a
variety of purposes, including home improvements, education and other personal
expenditures. Consumer loans also include installment loans to individuals for
personal, family and household purposes, including automobile loans to
individuals and pre-approved lines of credit. Consumer loans generally involve
more risk than first mortgage loans because the collateral for a defaulted loan
may not provide an adequate source of repayment of the principal. This risk is
due to the potential for damage to the collateral or other loss of value, while
the remaining deficiency often does not warrant further collection efforts. In
addition, consumer loan performance depends on the borrower's continued
financial stability and is, therefore, more likely to be adversely affected by
job loss, divorce, illness or personal bankruptcy.

REAL ESTATE LOANS. We make commercial real estate loans, construction
and development loans, and residential real estate loans. These loans include
commercial loans where we take a security interest in real estate out of an
abundance of caution and not as the principal collateral for the loan. Interest
rates for all categories may be fixed or adjustable, and will more than likely
be fixed for shorter-term loans. We will compete for real estate loans with
financial institutions and others who are well established and have greater
resources and lending limits. As a result, we may have to charge lower interest
rates to attract borrowers.

COMMERCIAL REAL ESTATE. We offer commercial real estate loans to
developers of both commercial and residential properties. We manage credit risk
associated with these loans by actively monitoring such measures as advance
rate, cash flow, collateral value and other appropriate credit factors. Risks
associated with commercial real estate loans include the general risk of the
failure of the commercial borrower, which are different for each type of
business and commercial entity. We evaluate each business on an individual basis
and attempt to determine such business' risks and credit profile. We attempt to
reduce credit risks in the commercial real estate portfolio by emphasizing loans
on owner-occupied office and retail buildings where the loan-to-value ratio,
established by independent appraisals, does not exceed 80%. In addition, we may
also require personal guarantees of the principal owners.

CONSTRUCTION AND DEVELOPMENT LOANS. We make construction and
development loans on a pre-sold and speculative basis. If the borrower has
entered into an arrangement to sell the property prior to beginning
construction, we consider the loan to be on a pre-sold basis. If the borrower
has not entered into an agreement to sell the property prior to beginning
construction, we consider the loan to be on a speculative basis. We make
residential and commercial construction loans to builders and developers and
consumers who wish to build their own home. We limit the term of most
construction and development loans to 18 months, although we may structure the
payments based

<PAGE> 49

on a longer amortization basis. We base speculative loans on the borrower's
financial strength and cash flow position. We disburse loan proceeds based on
the percentage of completion and only after an experienced construction lender
or appraiser inspects the project. These loans generally command higher rates
and fees commensurate with the risks warranted in the construction lending
field. The risk in construction lending depends upon the performance of the
builder, building the project to the plans and specifications of the borrower
and the bank's ability to administer and control all phases of the construction
disbursements. Upon completion of the construction, we typically convert
construction loans to permanent loans.

RESIDENTIAL REAL ESTATE LOANS. We make residential real estate loans to
qualified individuals for the purchase of existing single-family residences in
the our markets. We make these loans in accordance with our appraisal policy and
real estate lending policy which detail maximum loan to value ratios and
maturities. We believe that these loan to value ratios are sufficient to
compensate us for fluctuations in real estate market value and minimize losses
that could result from a downturn in the residential real estate market. We sell
mortgage loans that do not conform to our policies in the secondary markets. The
risk of these loans depends on the salability of the loan to national investors
and on interest rate changes. We intend to limit interest rate risk and credit
risk on these loans by locking in the interest rate for each loan with the
secondary market investor and receiving the investor's underwriting approval
before originating the loan. We retain loans for our portfolios when there is
sufficient liquidity to fund the needs of the established customers and when
rates are favorable to retain the loans. The loan underwriting standards and
policies are generally the same for both loans sold in the secondary market and
those retained in our portfolio.

ASSET AND LIABILITY MANAGEMENT

Our primary assets are our loan portfolio and investment account. Our
liabilities consist primarily of deposits. Our objective is to support asset
growth primarily through the growth of core deposits, which include deposits of
all categories made by individuals, partnerships, corporations and other
entities. Consistent with the requirements of prudent banking necessary to
maintain liquidity, we seek to match maturities and rates of loans and the
investment portfolio with those of deposits, although exact matching is not
always possible. We seek to invest the largest portion of our assets in
commercial, consumer and real estate loans. We anticipate that we will limit our
loans to less than 75% of deposits and capital funds. This ratio may be
exceeded, however, in the initial period of operation. Our investment account
consists primarily of marketable securities of the United States Government,
federal agencies and state and municipal governments, generally with varied
maturities.

We monitor our asset/liability mix on a regular basis with a monthly
report detailing interest-sensitive assets and interest-sensitive liabilities
presented to their board of directors. The objective of this policy is to
control interest-sensitive assets and liabilities in order to minimize the
impact of substantial movements in interest rates on our banks' earnings.

CORRESPONDENT BANKING

Correspondent banking involves providing services by one bank to
another bank which, from an economic or practical standpoint, cannot provide
that service for itself. We may purchase

<PAGE> 50

correspondent services offered by larger banks, including check collections,
purchase of federal funds, securities safekeeping, investment services, coin and
currency supplies, overline and liquidity loan participations, and sales of
loans to or participations with correspondent banks. We will sell loan
participations to correspondent banks with respect to loans which exceed our
lending limits. As compensation for services provided by a correspondent bank,
we may maintain balances with correspondents in non-interest bearing accounts.

OTHER SERVICES

Our other services include cash management services, safe deposit
boxes, traveler's checks, direct deposit of payroll and social security checks,
wire transfers, telephone banking, and automatic drafts for various accounts. We
offer a debit card, VISA and/or MasterCard credit card services through our
correspondent banks. We offer extended banking hours, both drive-in and lobby,
and an after-hours depository. We are associated with a shared network of
automated teller machines that customers may use throughout our market areas and
other regions. We are associated with third party Internet banking service
providers that enable us to provide customers with a cost effective, secure and
reliable Internet banking solution.

CUSTOMERS

We believe that the recent consolidation of the Florida banking
industry provides community-oriented community banks significant opportunities
to build successful, locally-oriented banks. We further believe that many of the
larger financial institutions do not provide the high level of personalized
services desired by many small and medium-sized businesses and their principals.
We intend to focus our marketing efforts on attracting small and medium-sized
businesses and individuals, including service companies, manufacturing
companies, commercial real estate developers, entrepreneurs and professionals,
such as physicians and attorneys.

Although we will concentrate our lending efforts on commercial
business, we also anticipate that we will attract a significant amount of
consumer business. We expect that many of our retail customers will be the
principals of our small and medium-sized business customers. These customers
comprise our private banking clients. We emphasize "relationship banking" in
order that each customer will identify and establish a comfort level with the
bank officers. We intend to develop our retail business with individuals who
appreciate a high level of personal service, contact with their lending officer
and responsive decision-making. We expect that most of our business will be
developed through our lending officers and local boards of directors and by
pursuing an aggressive strategy of calling on customers throughout the market
area.

COMPETITION

We are subject to intense competition in the Orlando market which we
currently serve, and expect to be subject to intense competition in the
southwest Florida market for our new bank. We face substantial competition in
all phases of our operations from a variety of different competitors.
This competition includes:

<PAGE> 51

o large national and super-regional financial institutions which
have well-established branches and significant market share in
the communities we serve;

o finance companies, investment banking and brokerage firms, and
insurance companies that offer bank-like products;

o credit unions, which can offer highly competitive rates on
loans and deposits because they receive tax advantages not
available to commercial banks;

o other community banks, including start-up banks, that can
compete with us for customers who desire a high degree of
personal service; and

o technology-based financial institutions including large
national and super-regional banks offering on-line deposit,
bill payment, and mortgage loan application services.

Other existing community banks, and many new community bank start-ups,
have marketing strategies similar to ours. These other community banks may open
new branches in the communities we serve and compete directly for customers who
want the level of service offered by community banks. Other community banks also
compete for the same management personnel in Florida.

Various legislative actions in recent years have led to increased
competition among financial institutions. With the enactment of the Riegle-Neal
Interstate Banking and Branching Efficiency Act of 1994 and other laws and
regulations affecting interstate bank expansion, it is easier for financial
institutions located outside of the State of Florida to enter the Florida
market, including our targeted markets. In addition, recent legislative and
regulatory changes and technological advances have enabled customers to conduct
banking activities without regard to geographic barriers through computer and
telephone-based banking and similar services. There can be no assurance that the
United States Congress, or the Florida Legislature or the applicable bank
regulatory agencies will not enact legislation or promulgate rules that may
further increase competitive pressures on us. Our failure to compete effectively
for customers in our market areas could have a material adverse effect on our
business, future prospects, financial condition or results of operations.

FACILITIES

Our principal executive office is located at 250 North Orange Avenue,
Orlando, Florida. We share our office with the main office of Southern Community
Bank. These offices occupy approximately 6,000 square feet on the ground floor
of a high-rise office building. The main office is leased for a term of ten
years through June 30, 2008. We may extend the lease for up to an additional ten
years.

Southern Community Bank's Altamonte Springs branch is located in a
building containing approximately 4,182 square feet under a ground lease with an
initial term expiring on November 30, 2018. We may extend the lease until
November 30, 2028.

<PAGE> 52

Southern Community Bank's Longwood branch is located in the Springs
Plaza Shopping Center in a space containing approximately 2,200 square feet
under a lease with an initial term expiring on December 8, 2003. We may extend
the lease until December 8, 2018.

Southern Community Bank owns its Winter Park branch, which occupies a
building containing approximately 4,850 square feet.

Southern Community Bank has acquired property located at 9021 Bonita
Beach Road, S.E., Bonita Springs, Florida. We will initially use this property
for a branch office of our existing bank, which will be housed in a temporary
facility. We plan to construct a permanent facility on this site starting in the
later part of 2000. We have also purchased property located at 1818 Immokalee
Road in Naples, Florida, which will become a branch office of the bank.

The Bonita Springs and Naples properties will be transferred to
Southern Community Bank of Southwest Florida when it commences operations.

The Bonita Springs property was formerly the site of a gas station at
which leaking underground fuel storage tanks caused some contamination of the
subsurface groundwater. The State of Florida has accepted this site for clean-up
under the State's remediation program, and the State has reserved $250,000 to
cover the estimated clean-up costs. Due to the relatively low priority level of
the site in the State's clean-up program, we cannot predict when the State will
commence or complete the clean-up of the site. We have received an environmental
engineering assessment of the contamination and the required remediation. Based
on this report, we believe that the clean-up of the site will not disrupt our
proposed banking services at the site.

EMPLOYEES

We currently have approximately 45 full-time employees. We will hire
additional employees as needed to support our growth.

We expect to hire approximately 11 full-time employees and one
part-time employee for our new bank before it commences operations. We
anticipate that our new bank will hire eight additional full-time employees
during its first year of operations.

LEGAL PROCEEDINGS

From time to time, we are involved in litigation arising from the
ordinary course of our business, such as claims to collect past due loans. As of
the date of this prospectus, we are not engaged in any material legal
proceedings.

<PAGE> 53
SUPERVISION AND REGULATION

GENERAL

We are subject to an extensive body of state and federal banking laws
and regulations which impose specific requirements and restrictions on, and
provide for general regulatory oversight with respect to, virtually all aspects
of our operations. We are also affected by government monetary policy and by
regulatory measures affecting the banking industry in general. The actions of
the Federal Reserve System affect the money supply, and in general, the lending
abilities of banks by increasing or decreasing the costs and availability of
funds to the banks. Additionally, the Federal Reserve System regulates the
availability of bank credit in order to combat recession and curb inflationary
pressures in the economy by open market operations in United States government
securities, changes in the discount rate on bank borrowings, changes in the
reserve requirements against bank deposits and limitations on interest rates
which banks may pay on time and savings deposits.

The following is a brief summary of some of the statutes, rules and
regulations which affect us. This summary is qualified in its entirety by
reference to the particular statutory and regulatory provisions referred to
below and is not intended to be an exhaustive description of the statutes or
regulations applicable to our business. Any change in applicable laws or
regulations may have a material adverse effect on the business and prospects of
these entities.

SOUTHERN COMMUNITY BANCORP

Southern Community Bancorp is a bank holding company within the meaning
of the Federal Bank Holding Company Act of 1956 and the Florida Interstate
Banking Act. Southern Community Bancorp is registered as a bank holding company
with the Federal Reserve System and is required to file annual reports and other
information regarding its business operations and those of any subsidiary. It is
also subject to the supervision of, and to periodic inspections by, the Federal
Reserve.

The Bank Holding Company Act requires every bank holding company to
obtain the prior approval of the Federal Reserve before:

o acquiring all or substantially all of the assets of a bank;

o acquiring direct or indirect ownership or control of more than
five percent of the voting shares of any bank; or

o merging or consolidating with another bank holding company.

Except as authorized by the Gramm-Leach-Bliley Act of 1999, a bank
holding company is generally prohibited by the Bank Holding Company Act from
engaging in, or acquiring direct or indirect control of more than five percent
of the voting shares of any company engaged in any business other than the
business of banking or managing and controlling banks. Some of the

<PAGE> 54
activities the Federal Reserve has determined by regulation to be proper
incidents to the business of banking, and thus permissible for bank holding
companies, include:

o making or servicing loans and certain types of leases;

o engaging in certain insurance and discount brokerage
activities;

o performing certain data processing services;

o acting in certain circumstances as a fiduciary or investment
or financial advisor;

o owning savings associations; and

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

In determining whether an activity is so closely related to banking as
to be permissible for bank holding companies, the Federal Reserve is required to
consider whether the performance of the particular activities by a bank holding
company or its subsidiaries can reasonably be expected to produce benefits to
the public, such as greater convenience, increased competition and gains in
efficiency that outweigh possible adverse effects, such as undue concentration
of resources, decreased or unfair competition, conflicts of interests and
unsound banking practices. Generally, bank holding companies are required to
obtain prior approval of the Federal Reserve to engage in any new activity not
previously approved by the Federal Reserve. Despite prior approval, the Federal
Reserve may order a bank holding company or its subsidiaries to terminate any
activity or to terminate its ownership or control of any subsidiary when it has
reasonable cause to believe that the holding company's continued ownership,
activity or control constitutes a serious risk to the financial safety,
soundness or stability of any of its bank subsidiaries.

The Bank Holding Company Act and the Federal Change in Bank Control
Act, together with regulations promulgated by the Federal Reserve, require that,
depending on the particular circumstances, either the Federal Reserve's approval
must be obtained or notice must be furnished to the Federal Reserve and not
disapproved prior to any person or company acquiring control of a bank holding
company, such as Southern Community Bancorp, subject to certain exemptions.
Control is conclusively presumed to exist when an individual or company acquires
25 percent or more of any class of voting securities of the bank holding
company. Control is rebuttably presumed to exist if a person acquires 10 percent
or more, but less than 25 percent, of any class of voting securities and either
the bank holding company has registered securities under Section 12 of the
Securities Exchange Act of 1934 or no other person owns a greater percentage of
that class of voting securities immediately after the transaction. Southern
Community Bancorp is required to register its common stock under Section 12 of
the Securities Exchange Act of 1934 prior to the offering.

The Federal Reserve, pursuant to regulation and published policy
statements, has maintained that a bank holding company must serve as a source of
financial strength to its subsidiary banks. In adhering to the Federal Reserve's
policy, Southern Community Bancorp may be required to provide financial support
to a subsidiary bank at a time when, absent such Federal Reserve policy, it
might

<PAGE> 55
not be deemed advisable to provide such assistance. Under the Bank Holding
Company Act, the Federal Reserve may also require a bank holding company to
terminate any activity or relinquish control of a non-bank subsidiary, other
than a non-bank subsidiary of a bank, upon the Federal Reserve's determination
that the activity or control constitutes a serious risk to the financial
soundness or stability of any subsidiary depository institution of the bank
holding company. Further, federal bank regulatory authorities have additional
discretion to require a bank holding company to divest itself of any bank or
non-bank subsidiary if the agency determines that divestiture may aid the
depository institution's financial condition.

THE BANKS

As state banks, Southern Community Bank is, and Southern Community Bank
of Southwest Florida will be, subject to the supervision of the Florida
Department of Banking and Finance and the FDIC. Southern Community Bank's
deposits are insured by the FDIC for a maximum of $100,000 per depositor, and
the deposits of Southern Community Bank of Southwest Florida will be similarly
insured. For this protection, the banks must pay a semi-annual statutory
assessment and comply with the rules and regulations of the FDIC. The Florida
Department of Banking and Finance and the FDIC regulate and monitor all areas of
a bank's operations, including:

o security devices and procedures;

o adequacy of capitalization and loss reserves;

o loans;

o investments;

o borrowings;

o deposits;

o mergers;

o issuances of securities;

o payment of dividends;

o interest rates payable on deposits;

o interest rates or fees chargeable on loans;

o establishment of branches;

o corporate reorganizations;

o maintenance of books and records; and

<PAGE> 56
o adequacy of staff training to carry out safe lending and
deposit gathering practices.

In addition, banks are prohibited from engaging in tie-in arrangements in
connection with any extension of credit, or the offer of any property or
service. The regulatory requirements to which banks are subject also set forth
various conditions regarding the eligibility and qualifications of their
officers and directors.

CAPITAL ADEQUACY REQUIREMENTS

Both Southern Community Bancorp and its banks are subject to regulatory
capital requirements imposed by the Federal Reserve and the FDIC which vary
based on differences in risk profiles. The capital adequacy guidelines issued by
the Federal Reserve are applied to bank holding companies on a consolidated
basis with the banks owned by the holding company. The FDIC's risk-based capital
guidelines apply directly to insured state banks, such as Southern Community
Bank and Southern Community Bank of Southwest Florida, regardless of whether
they are subsidiaries of a bank holding company. Both agencies' requirements,
which are substantially similar, provide that banking organizations must have
capital (as defined in the rules) equivalent to eight percent of risk-weighted
assets. The risk weights assigned to assets are based primarily on credit risks.
Depending upon the riskiness of a particular asset, it is assigned to a risk
category. For example, securities with an unconditional guarantee by the United
States government are assigned to the lowest risk category. The aggregate amount
of assets assigned to each risk category is multiplied by the risk weight
assigned to that category to determine the weighted values, which are added
together to determine total risk-weighted assets.

Both the Federal Reserve and the FDIC have also adopted minimum capital
leverage ratios to be used in tandem with the risk-based guidelines in assessing
the overall capital adequacy of banks and bank holding companies. The guidelines
define a two-tier capital framework. Tier 1 capital consists of common and
qualifying preferred shareholder's equity, less goodwill and other adjustments.
Tier 2 capital consists of mandatory convertible, subordinated, and other
qualifying term debt, preferred stock not qualifying for Tier 1, and a limited
allowance for credit losses up to a designated percentage of risk-weighted
assets. Under these guidelines, institutions must maintain a specified minimum
ratio of "qualifying" capital to risk-weighted assets. At least 50 percent of an
institution's qualifying capital must be "core" or "Tier 1" capital, and the
balance may be "supplementary" or "Tier 2" capital. The guidelines imposed on
the banks include a minimum leverage ratio standard of capital adequacy. The
leverage standard requires top-rated institutions to maintain a minimum Tier 1
capital to assets ratio of three percent, with institutions receiving less than
the highest rating required to maintain a ratio of four percent or greater,
based upon their particular circumstances and risk profiles.

Federal bank regulatory authorities have adopted regulations revising
the risk-based capital guidelines to further ensure that the guidelines take
adequate account of interest rate risk. Interest rate risk is the adverse effect
that changes in market interest rates may have on a bank's financial condition
and is inherent to the business of banking. Under the regulations, when
evaluating a bank's capital adequacy, the revised capital standards now
explicitly include a bank's exposure to declines in the economic value of its
capital due to changes in interest rates. The exposure of a bank's

<PAGE> 57
economic value generally represents the change in the present value of its
assets, less the change in the value of its liabilities, plus the change in the
value of its interest rate off-balance sheet contracts.

The foregoing capital guidelines could affect our banks in several
ways. If the banks grow rapidly, their capital base may become insufficient to
support continued growth, making an additional capital infusion necessary. The
capital guidelines could also impact the banks' ability to pay dividends. It is
expected that the banks' capital levels will initially be more than adequate.
Rapid growth, poor loan portfolio performance or poor earnings performance, or a
combination of these factors, could change our capital position in a relatively
short period of time. Failure to meet these capital requirements would require
the banks to develop and file with the FDIC a plan describing the means and a
schedule for achieving the minimum capital requirements. In addition, we would
not be able to receive regulatory approval of any application that required
consideration of capital adequacy, such as a branch or merger application,
unless we could demonstrate a reasonable plan to meet the capital requirement
within a reasonable period of time.

DIVIDENDS

Our ability to pay cash dividends will depend entirely upon the amount
of dividends paid by our bank subsidiaries. Additionally, the Florida Business
Corporation Act provides that we may only pay dividends if the dividend payment
would not render us insolvent or unable to meet our obligations as they come
due.

Our banks will be subject to regulatory restrictions on the payment of
dividends, including a prohibition of payment of dividends from the banks'
capital without the prior approval of the Florida Department of Banking and
Finance and the FDIC. Except with the prior approval of the Florida Department
of Banking and Finance, all dividends of any Florida bank must be paid out of
retained net profits from the current period and the previous two years, after
deducting expenses, including losses and bad debts. In addition, any Florida
bank is required to transfer at least 20 percent of its net income to surplus
until their surplus equals the amount of paid-in capital. Our existing bank is
not currently able to pay dividends because it has incurred losses since its
inception.

OTHER LAWS

State usury laws and federal laws concerning interest rates limit the
amount of interest and various other charges collected or contracted by a bank.
Our lending operations will be subject to federal laws applicable to credit
transactions, such as the:

o Federal Truth-In-Lending Act governing disclosures of credit
terms to consumer borrowers;

o Community Reinvestment Act requiring financial institutions to
meet their obligations to provide for the total credit needs
of the communities they serve, including investing their
assets in loans to low and moderate-income borrowers;

<PAGE> 58

o Home Mortgage Disclosure Act requiring financial institutions
to provide information to enable public officials to determine
whether a financial institution is fulfilling its obligations
to meet the housing needs of the community it serves;

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

o Fair Credit Reporting Act governing the manner in which
consumer debts may be collected by collection agencies; and

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

Our deposit operations are also subject to the:

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

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

INTERSTATE BANKING AND BRANCHING

Under the Riegle-Neal Interstate Banking and Branching Efficiency Act
of 1994, eligible bank holding companies in any state are permitted, with
Federal Reserve approval, to acquire banking organizations in any other state.
As such, all regional compacts and substantially all then-existing regional
limitations on interstate acquisitions of banking organizations have been
eliminated. The Interstate Banking and Branching Efficiency Act also removed
substantially all of the then-existing prohibitions on interstate branching by
banks. The authority of a bank to establish and operate branches within a state
continues to be subject to applicable state branching laws. Subject to these
laws, a bank operating in any state may now establish one or more branches
within any other state without the establishment of a separate banking structure
within the other state through the merger with an existing bank in that state.
Under current Florida law, our banks may open branch offices throughout Florida
with the prior approval of the Florida Department of Banking and Finance and the
FDIC. In addition, with prior regulatory approval, we will be able to acquire
existing banking operations in other states. Although the Interstate Banking and
Branching Efficiency Act has the potential to increase the number of competitors
in the respective market areas of the banks, we cannot predict the actual impact
of such legislation on the competitive position of the banks.

<PAGE> 59

FINANCIAL MODERNIZATION

The recently enacted Gramm-Leach-Bliley Act of 1999 sought to achieve
significant modernization of the federal bank regulatory framework by allowing
the consolidation of banking institutions with other types of financial services
firms, subject to various restrictions and requirements. In general, the
Gramm-Leach-Bliley Act repealed most of the federal statutory barriers which
separated commercial banking firms from insurance and securities firms and
authorized the consolidation of such firms in a "financial services holding
company." Southern Community Bancorp has no immediate plans to utilize the
structural options created by the Gramm- Leach-Bliley Act, but may develop such
plans in the future. In the meantime, we may provide our customers with a
broader range of financial products and services, including various insurance
products and securities brokerage services, through cooperative arrangements
with one or more suitable third-party vendors.

<PAGE> 60
MANAGEMENT

EXECUTIVE OFFICERS AND DIRECTORS

The following table sets forth certain information with respect to our
executive officers and directors.

Name Age Position With Southern Community Bancorp
---- --- ----------------------------------------
<S> <C> <C>
Charlie W. Brinkley, Jr. .................. 46 Chairman of the Board and Chief Executive
Officer
John G. Squires............................ 53 President and Chief Operating Officer
Patrick J. Armstrong....................... 53 Director
Richard M. Dunn............................ 50 Director
Jennings L. Hurt, III ..................... 47 Director
Eugene M. Pascarella....................... 45 Director
Jon C. Peterson............................ 61 Director
John K. Ritenour........................... 48 Director
Stanley H. Sandefur........................ 47 Director
Stephen R. Jeuck .......................... 48 Secretary and Chief Financial Officer

</TABLE>

CHARLIE W. BRINKLEY, JR. has served as chairman of the board and chief
executive officer of Southern Community Bancorp since its organization in 1999.
Mr. Brinkley was an organizing director of Southern Bank of Central Florida and
served as its only president and chief executive officer from 1988 to 1996 when
it was acquired by Colonial Bank of Montgomery, Alabama. From 1996 until 1998,
Mr. Brinkley continued to serve as president of Colonial Bank, Florida region.
Mr. Brinkley began his banking career in the Orlando area in 1978 at ComBank of
Casselberry, which was acquired by Freedom Savings and Loan Association in 1983.

JOHN G. SQUIRES has served as president and chief operating officer of
Southern Community Bancorp since its organization in 1999. He was an organizing
director of Southern Community Bank in 1998 and has served as its only president
and chief executive officer. Mr. Squires was also an organizing director of
Southern Bank of Central Florida in 1988 and served as its vice-chairman until
its acquisition by Colonial Bank in 1996. From 1996 until 1997, Mr. Squires
continued to serve as an executive vice president and director of Colonial Bank,
Florida region. Mr. Squires began his Florida banking career in 1978 as
president and director of ComBank of Casselberry which was acquired by Freedom
Savings and Loan Association in 1983.

PATRICK J. ARMSTRONG has served as a director of Southern Community
Bancorp since 1999 and director of Southern Community Bank since 1998. Since
1985, Mr. Armstrong has served as president of Parc Records, Inc.

RICHARD M. DUNN has served as a director of Southern Community Bancorp
since 1999 and director of Southern Community Bank since 1998. Since 1977, Mr.
Dunn has served as president of Richard M. Dunn, D.D.S., P.A.

<PAGE> 61
JENNINGS L. HURT, III has served as a director of Southern Community
Bancorp since 1999 and director of Southern Community Bank since 1998. Since
1988, Mr. Hurt has served as the managing shareholder of the law firm Rissman,
Weisberg, Barrett, Hurt, Donahue & McLain, P.A., located in Orlando, Florida.

EUGENE M. PASCARELLA has served as a director of Southern Community
Bancorp since 1999 and director of Southern Community Bank since 1998. Since
1984, Mr. Pascarella has served as a principal in Foot and Ankle Associates of
Florida.

JON C. PETERSON has served as a director of Southern Community Bancorp
since 1999 and was an organizing director of Southern Community Bank. Since
1984, Mr. Peterson has been the owner and chief executive officer of Peterson
Broadcasting which owns an Albany, Georgia radio station. Since 1994, Mr.
Peterson has been the owner and chief executive of Riskey, Inc., which owns
a motel in Marathon, Florida. Since 1995, Mr. Peterson has been the owner and
chief executive of Kinetic Communications which owns a Fayetteville, North
Carolina radio station.

JOHN K. RITENOUR has served as a director of Southern Community Bancorp
since 1999 and director of Southern Community Bank since 1998. Since 1988, Mr.
Ritenour has served as chief executive officer of the Insurance Office of
America, Inc.

STANLEY H. SANDEFUR has served as a director of Southern Community
Bancorp since 1999 and director of Southern Community Bank since 1998. Since
1978, Mr. Sandefur has served as president and chief executive officer of
Sandefur Holding Co., Inc. From 1985 to 1997, Mr. Sandefur served as a director
of Seminole National Bank.

STEPHEN R. JEUCK has served as secretary and chief financial officer of
Southern Community Bancorp since its organization in 1999. Since 1998, Mr. Jeuck
has served as vice president and chief financial officer of Southern Community
Bank. From 1995 until 1997, Mr. Jeuck served as vice president and controller of
Southern Bank of Central Florida and Colonial Bank, Florida.

PROPOSED NEW DIRECTORS

We expect to add four new directors to our board after the organization
of Southern Community Bank of Southwest Florida. We expect that two of these
additional directors will be Richard Garner, the proposed chairman and chief
executive officer of the new bank, and Joel Whittenhall, the proposed president
and chief lending officer of the new bank. We have not identified the other two
additional directors.

<PAGE> 62

EXECUTIVE OFFICERS AND DIRECTORS OF OUR EXISTING BANK

The following table sets forth certain information with respect to the
executive officers and directors of Southern Community Bank.

Name Position With Southern Community Bank
---- -------------------------------------
<S> <C>
Charlie W. Brinkley, Jr. Chairman of the Board
John G. Squires President, Chief Executive Officer and
Director
Patrick J. Armstrong Director
Derek C. Burke Director
Richard M. Dunn Director
Jennings L. Hurt, III Director
Nancy Daniel Outlaw Director
Eugene M. Pascarella Director
John K. Ritenour Director
Stanley H. Sandefur Director
Norman P. Thompson, Jr. Executive Vice President and Chief Lending
Officer
Teague L. Gilliland Executive Vice President and Senior
Operations Officer
Stephen R. Jeuck Vice President and Chief Financial Officer

</TABLE>

All of the executive officers and directors of Southern Community Bank
also serve as executive officers or directors of Southern Community Bancorp
other than Derek C. Burke, Nancy Daniel Outlaw, Norman P. Thompson, Jr. and
Teague L. Gilliland.

DEREK C. BURKE has served as director of Southern Community Bank since
1998. Mr. Burke is the founder of the Orlando-based civil engineering consulting
firm, WBQ Design and Engineering, Inc. and has served as its president since
1994.

NANCY DANIEL OUTLAW has served as director of Southern Community Bank
since 1998. Since 1998, Ms. Outlaw has served as branch manager of Coldwell
Banker Residential Real Estate, Longwood, Florida. From 1996 until 1998, Ms.
Outlaw served as vice-president/manager of Higgins & Heath Realtors. From 1981
until 1996, Ms. Outlaw was a real estate broker and owner of Daniel &
Wohlenwender Realty, Inc.

<PAGE> 63

NORMAN P. THOMPSON, JR. has served as executive vice president and
chief lending officer of Southern Community Bank since its organization in 1998.
From 1996 until 1998, Mr. Thompson served as senior corporate banking executive
for Colonial Bank, Florida region. From 1987 to 1996, Mr. Thompson held various
positions in the corporate banking department of Barnett Bank of Central
Florida, N.A., Orlando, where he was a senior vice president. From 1985 to 1987,
Mr. Thompson served as regional executive for central Florida for Pioneer
Savings Bank, Clearwater. From 1973 to 1985, Mr. Thompson held various positions
with ComBanks Corporation, Winter Park, including service as president of a
newly chartered bank subsidiary of that company. During his tenure there,
ComBanks was merged with Freedom Savings and Loan Association, Tampa.

TEAGUE L. GILLILAND has served as executive vice president and senior
operations officer of Southern Community Bank since 1999. From 1996 to 1999, Ms.
Gilliland served as branch manager of the Lake Mary and Longwood, Florida
offices of Colonial Bank, formerly offices of Southern Bank of Central Florida.
From 1994 to 1996, Ms. Gilliland served as a regional trainer for the
acquisitions team for AmSouth Bancorporation, Birmingham, Alabama. From 1986 to
1994, Ms. Gilliland was a branch administrator and acquisitions coordinator for
Orange Bank, Orlando. From 1970 to 1979, Ms. Gilliland worked in various
positions for SunTrust Bank of Central Florida, N.A., Orlando.

Our future success depends, in large part, upon the continuing
contributions of our key management personnel, including the chairmen and the
presidents of our existing bank and our proposed new bank. The loss of services
of one or more key employees could have a material adverse effect on our
operations and financial condition. We can provide no assurance that we will be
able to retain any of our key officers or employees or attract or retain
qualified personnel in the future. None of our key executives has an employment
agreement.

PROPOSED EXECUTIVE OFFICERS AND DIRECTORS OF OUR PROPOSED NEW BANK

The proposed board of directors of Southern Community Bank of Southwest
Florida will consist initially of eight persons from the Bonita Springs and
Naples, Florida communities, in addition to Mr. Brinkley and Mr. Squires. The
executive officers of the new bank will include Richard L. Garner, its chairman
of the board of directors and chief executive officer, and Joel E. Whittenhall,
its president and chief lending officer, who will also serve as a director.

Proposed Position with Southern Community
Name Bank of Southwest Florida
---- -----------------------------------------

Richard L. Garner Chairman of the Board and Chief Executive
Officer
Joel E. Whittenhall President, Director and Chief Lending
Officer
Charlie W. Brinkley, Jr. Director
John G. Squires Director
Frederick T. Barber III Director

<PAGE> 64

Gerald T. Berry Director
Dennis E. Gilkey Director
Clark D. Jensen Director
Edward J. Oates Director

G. Donald Thomson, Jr. Director

RICHARD L. GARNER served as president and chief executive officer of
First National Bank of Bonita Springs (subsequently known as First National Bank
of Florida) from 1994 until the acquisition of that bank by Colonial Bank,
Montgomery, Alabama, in 1998. From 1998 until 1999, Mr. Garner served as
regional president and CEO of Colonial Bank, Southwest Florida region. From 1991
to 1994, Mr. Garner was senior vice president and chief lending officer of that
bank. From 1982 to 1991, Mr. Garner held the positions of vice president, branch
manager and commercial lending officer for American Bank in Merritt Island. From
1979 until 1982 Mr. Garner was a vice president and commercial lending officer
for the Bank of Brevard in Melbourne, Florida.

JOEL E. WHITTENHALL served as executive vice president and senior
lending officer of First National Bank of Florida (subsequently acquired by
Colonial Bank) from 1994 to 1999. From 1985 to 1992, Mr. Whittenhall was
employed by SunBank/Naples, N.A., serving initially as manager of that bank's
problem loan portfolio and from 1992, as senior vice president and lending group
manager. From 1981 to 1985, Mr. Whittenhall served as a commercial lending
officer for Southeast Bank, N.A. in Naples.

FREDERICK T. BARBER, III, is a civil engineer residing in Bonita
Springs. Since 1983, Mr. Barber has been a principal owner and chief executive
of the engineering firm Agnoli, Barber & Brundage, Inc., Naples.

GERALD T. BERRY, is an attorney residing in Naples. Since 1990, Mr.
Berry has been president of the law firm Berry, Day & McFee, Naples.

DENNIS E. GILKEY, is a professional engineer residing in Bonita
Springs. Since 1984, Mr. Gilkey has been employed with the real estate
development firm Bonita Bay Properties, Inc., Bonita Springs, and has served as
its chief executive officer since 1998.

CLARK D. JENSEN, is a building contractor residing in Naples. Since
1998, Mr. Jensen has been president of Jensen & Bernier, Inc., Naples. From 1994
to 1998 he was vice president of Imperial Homes of Naples, Inc.

EDWARD J. OATES, is a retired banker residing in Naples. From 1995 to
1999, Mr. Oates served as director of First National Bank of Florida, Bonita
Springs. From 1972 to 1988 Mr. Oates was employed with Southeast Bank, N.A.,
Naples, where he served as executive vice president and cashier.

<PAGE> 65

G. DONALD THOMSON, JR., is an attorney residing in Bonita Springs.
Since 1996, Mr. Thomson has been a shareholder in the law firm G. Donald
Thomson, P.A., Bonita Springs. From 1984 to 1996, he was an associate and
partner of the firm Young, Van Assenderp & Varnadoe, P.A., in Naples.

BOARD COMPENSATION

We do not currently provide the directors of our holding company or our
existing bank with cash compensation for their services as directors, although
members are reimbursed for reasonable expenses incurred in attending meetings.
We also do not intend to pay any cash compensation to the directors of our new
bank for their services as directors.

In July 1999, we granted each of our non-executive directors options to
acquire 10,000 shares of common stock at a price of $15.00 per share. See
"Management - Director Stock Option Plan."

We plan to grant options to purchase 5,000 shares to each of the
directors of our new bank upon its opening. These options will have
substantially the same terms as the options granted to our current directors,
except that the exercise price will be $16.50 per share.

DIRECTOR STOCK OPTION PLAN

We have adopted a Director Stock Option Plan effective as of March 18,
1999. The plan provides for grants of nonqualified stock options to purchase
shares of common stock to our directors. By encouraging stock ownership, we seek
to motivate such individuals to promote our success. As of the date of this
prospectus, we have granted options to purchase 70,000 shares of common stock
under the plan, with an exercise price of $15.00 per share. These options
represent all of the options available under the plan.

The board of directors administers and interprets the plan. The board
of directors has complete discretion to determine which directors are eligible
to receive option grants, the number of shares subject to each such grant, the
terms of each option, and the fair market value of the shares of common stock
underlying options. The board of directors may suspend or terminate the plan at
any time. The board of directors may amend or modify the plan at any time,
provided that no such amendment or modification may adversely affect the rights
and obligations of the participants with respect to their outstanding options or
vested shares without their consent. In addition, no amendment of the plan may,
without the approval of shareholders:

o modify the class of individuals eligible for participation in
the plan;

o amend the provisions of the plan relating to the plan's
administration;

o increase the number of shares of common stock available for
issuance under the plan, except in the event of certain
changes to the capital structure of Southern Community
Bancorp; or

o extend the term of options granted under the plan.

<PAGE> 66

The plan will terminate on March 18, 2009. However, such termination will not
affect any options granted under the plan or vested shares.

Each option granted under the option plan has a term of 10 years,
subject to earlier termination following the director's termination for
deliberate, willful or gross misconduct. The maximum number of shares for which
options may be granted to any director pursuant to the plan is 10,000 shares. In
no event will an option be granted to a director who, at the time such option is
granted, owns shares possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of Southern Community Bancorp. The
minimum number of shares for which options may be exercised at any one time is
100 shares. The purchase price for shares of common stock is payable in cash
immediately upon the exercise of the option. Each option granted under the plan
is non-transferable by the director and exercisable during the director's
lifetime only by such director. However, in the event that the director dies
prior to exercising an option, such option may be exercised by the personal
representative of the estate of such director for a period of one year after
such representative's appointment. If options granted under the plan expire or
are terminated for any reason without being exercised, the shares of common
stock underlying such grant will again be available for purposes of the plan.

EXECUTIVE COMPENSATION

The following table sets forth information concerning compensation for
services rendered to us in 1999 by our chief executive officer and president. No
other officer earned $100,000 or more in combined salary and bonus in 1999.

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>

LONG-TERM COMPENSATION
-------------------------------
AWARDS
-------------------------------
ANNUAL COMPENSATION RESTRICTED SECURITIES
--------------------------- STOCK UNDERLYING
NAME AND PRINCIPAL POSITION SALARY BONUS AWARDS OPTIONS
--------------------------- ------ ----- ------ -------
<S> <C> <C> <C> <C>
Charlie W. Brinkley, Jr. $100,000 $10,000 $75,000(1) 35,000
Chief Executive Officer

John G. Squires $100,000 $10,000 -- 17,500
President
</TABLE>

<PAGE> 67

----------
(1) At December 31, 1999, Mr. Brinkley owned 5,000 shares of common stock,
valued at $75,000, based on a price of $15.00 per share, as determined by
the Board of Directors. The shares vest over a five-year period from the
date of grant with five percent (5%) of the total number of shares being
vested on the first anniversary of the date of grant, ten percent (10%) of
such shares being vested on the second anniversary of the date of grant,
thirty-five percent (35%) of such shares being vested on the third
anniversary of the date of grant, and twenty-five percent (25%) of such
shares being vested on the fourth and fifth anniversaries of the date of
grant. Dividends, if any, will be paid on shares which have become vested.

The following table sets forth certain information concerning options
granted in 1999 to our chief executive officer and president. We have no
outstanding stock appreciation rights. No options were exercised during 1999.

OPTION GRANTS IN LAST FISCAL YEAR

INDIVIDUAL GRANTS
-----------------------------------
NUMBER OF % OF
SECURITIES TOTAL OPTIONS
UNDERLYING GRANTED TO
OPTIONS EMPLOYEES EXERCISE PRICE EXPIRATION
NAME GRANTED (#) IN FISCAL YEAR PER SHARE ($/SH) DATE
---- ----------- -------------- ---------------- -----

<S> <C> <C> <C> <C>
Charlie W. Brinkley, Jr............. 35,000 37.6% $15.00 Jan. 2009
John G. Squires..................... 17,500 18.8% $15.00 June 2009

</TABLE>

The following table sets forth information with respect to our chief
executive officer and president concerning the exercise of options during 1999
and unexercised options held as of the end of 1999.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>

VALUE OF
NUMBER OF SECURITIES UNEXERCISED
UNDERLYING IN-THE-MONEY
UNEXERCISED OPTIONS OPTIONS AT
AT FY-END (#) FY-END ($)
-------------------- --------------------
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE (#) REALIZED ($) UNEXERCISABLE UNEXERCISABLE
---- --------------- ------------ -------------------- --------------------
<S> <C> <C> <C> <C>
Charlie W. Brinkley, Jr. . . . . -- -- 7,000 / 28,000 -- /--
John G. Squires . . . . . . . . -- -- 7,000 / 10,500 -- /--

</TABLE>

62
<PAGE> 68

We have agreed to pay Mr. Brinkley and Mr. Squires annual base salaries
of $150,000 in 2000. We have also agreed to pay Richard Garner, the proposed
Chairman and Chief Executive Officer of our new bank, and Joel E. Whittenhall,
the proposed President of our new bank, annual base salaries of $135,000 upon
the opening of the new bank.

We have entered into salary continuation agreements for Mr. Brinkley
and Mr. Squires. We have also agreed to issue shares to Mr. Brinkley as
compensation for his services as an officer, and to grant stock options to Mr.
Squires for his services as an officer. See "- Salary Continuation Agreements";
"- Stock Restriction Agreement" and "-Employee Stock Option Plan."

SALARY CONTINUATION AGREEMENTS

We have entered into salary continuation agreements with Mr. Brinkley
and Mr. Squires pursuant to which they are entitled to receive various benefits
in the event of the termination of their employment as a result of normal
retirement, death, disability, or following a change of control of Southern
Community Bancorp. With the exception of the change of control benefit, the
benefit payments vest over a 10 year period and are payable in monthly
installments for a benefit period of 15 years (in the case of Mr. Squires) or 20
years (in the case of Mr. Brinkley), with annual adjustments for changes in the
consumer price index. No benefits will be payable under either agreement in the
event of termination of the employment for cause. In the event of a change of
control of Southern Community Bancorp, the fully vested normal retirement
benefit would be payable to each of Mr. Brinkley and Mr. Squires for their
respective benefit periods, provided that no benefits are payable that would be
subject to the excise tax applicable to excess parachute payments under the
Internal Revenue Code. In addition to the foregoing, in the event of any
termination of their employment as a result of a change of control of Southern
Community Bancorp, Mr. Brinkley would be entitled to receive a lump sum
severance payment equal to 25% of his base salary and Mr. Squires would be
entitled to receive a lump sum severance payment equal to three times his base
salary if such termination occurs prior to January 1, 2002, or two times his
base salary if such termination occurs thereafter.

We intend to enter into similar agreements with Mr. Whittenhall upon
the opening of the new bank.

RESTRICTED STOCK AGREEMENT WITH MR. BRINKLEY

On January 1, 1999, Mr. Brinkley entered into an agreement with
Southern Community Bancorp providing for the grant of 50,000 unregistered shares
of common stock, which are non-transferable except as described below. The
agreement provides that 5,000 shares will be granted to Mr. Brinkley each year
for a period of 10 years commencing on January 1, 1999 and on each January 1st
thereafter through the year 2008; however, shares granted after year 2003 will
be granted in the sole discretion of the board of directors based on the
performance of Southern Community Bancorp. Shares of stock granted on January 1,
1999 and January 1, 2000 vest over a five year period from the date of grant

63
<PAGE> 69

with five percent (5%) of the total number of such shares being vested on the
first anniversary of the date of grant, ten percent (10%) of such shares being
vested on the second anniversary of the date of grant, thirty-five percent (35%)
of such shares being vested on the third anniversary of the date of grant, and
twenty-five percent (25%) of such shares being vested on the fourth and fifth
anniversaries of the date of grant. Shares of stock granted after January 1,
2000 shall vest ratably over a three year period from the date of grant, with
thirty-three percent (33%) of such shares being vested on each of the first,
second and third anniversary of the date of grant. In the event that a majority
of the outstanding shares of Southern Community Bancorp are acquired in a merger
or other transaction requiring approval under the Bank Holding Company Act of
1956, as amended, all shares issuable under the plan will immediately be granted
to Mr. Brinkley and become fully vested shares. If Mr. Brinkley is terminated
without cause, all of the shares granted to him under the plan shall be
immediately and fully vested and transferable without restriction. If Mr.
Brinkley is terminated for cause, Mr. Brinkley forfeits all rights to the stock
except stock which has become vested as of the date of such termination.

EMPLOYEE INCENTIVE STOCK OPTION PLAN

We have adopted the Employee Incentive Stock Option Plan, effective as
of June 1, 1999. The plan provides for grants of incentive stock options to
purchase shares of common stock to certain officers and key management employees
of Southern Community Bancorp and its subsidiaries. The purpose of the plan is
to attract and retain qualified capable management personnel, provide additional
incentives to such persons and promote the success of our business. As of the
date of this prospectus, 93,000 options have been granted at a price of $15.00
per share, and options to purchase an additional 13,000 shares of common stock
remain available for issuance pursuant to the plan. The options previously
granted under the plan include options granted to Messrs. Brinkley and Squires
to purchase 35,000 shares and 17,500 shares, respectively.

Subject to approval by the shareholders of an increase in the number of
shares reserved under our existing stock option plans, the Board of Directors
has approved the grant to Mr. John Squires of options to purchase up to an
additional 67,500 shares of our common stock. Of this total, we will grant an
option to purchase 17,500 shares at an exercise price of $15.00 per share,
subject to vesting on a pro-rata basis over a term of five years commencing as
of January 1, 1998. We will grant an option to purchase the balance of 50,000
shares at a price of $15.00 per share with vesting parallel to the vesting of
the stock granted to Mr. Brinkley pursuant to the above mentioned agreement
after January 1, 2000. We also intend to grant options to each of Mr. Richard
Garner and Mr. Joel Whittenhall to purchase 30,000 shares at $16.50 per share.

The board of directors administers and interprets the plan. The board
of directors has complete discretion to determine which employees are eligible
to receive option grants, the number of shares subject to each such grant, the
time or times when options will be granted, the price of the shares subject to
each option, the time when each option may be exercised, any other provisions of
the option agreement and all questions relating to the administration of the
plan. The shareholders of Southern Community Bancorp may terminate, modify or
amend the plan at any time. In addition, the board of directors may amend or

64
<PAGE> 70

modify the plan at any time, provided that no such amendment or modification may
adversely affect the rights and obligations of the participants with respect to
their outstanding options or vested shares without their consent. In addition,
no amendment of the plan may, without the approval of shareholders:

o increase the number of shares for which options may be granted under
the plan;

o increase the purchase price for the shares subject to options;

o alter the periods during which options may be granted or exercised;

o alter the provisions relating to the determination of employees to
whom options may be granted;

o alter the provisions relating to the annual dollar limitation upon
options granted to any employee;

o alter the provisions relating to the transferability of the options;
or

o alter the provisions relating to the employment status of an
employee to whom an option may be granted.

The plan will terminate on March 18, 2009; however, such termination will not
affect any options granted under the plan or vested shares.

Each option granted under the plan has a maximum term of 10 years,
subject to earlier termination following the participant ceasing to be an
employee. The exercise price of an option granted under the plan must be at
least 100% of the fair market value of the stock subject to the option on the
date of grant, or 110% with respect to an option granted to a holder of more
than 10% of the combined voting power of all classes of stock of Southern
Community Bancorp. The minimum number of shares for which options may be
exercised at any one time is 100 shares. In general, options vest ratably over a
five year period commencing one year from the date of grant, except as otherwise
determined by the Board of Directors. The purchase price for shares of common
stock is payable in cash immediately upon the exercise of the option. Each
option granted under the plan is non-transferable and exercisable only during
the holder's lifetime. In the event that the holder dies prior to exercising an
option, such option may be exercised by the personal representative of the
estate of such holder for a period of one year after such representative's
appointment. In the event that the holder is terminated for any reason other
than death, such option may be exercised at any time prior to the expiration
date of the option or within three months after the date of such termination, or
12 months in the case of an employee who is disabled, whichever is earlier, but
only to the extent such holder had the right to exercise such option at the date
of such termination; provided, however, that, if the holder's employment is
terminated as a result of deliberate, willful or gross misconduct, all rights
under the option shall terminate and expire upon such termination. If options
granted under the plan expire or are terminated for any reason without being
exercised, the shares of common stock underlying such grant will again be
available for purposes of the plan.

65
<PAGE> 71

In the event of a reorganization, merger or consolidation in which
Southern Community Bancorp is not the surviving corporation, the sale of
substantially all of the assets of Southern Community Bancorp to another
corporation, or a change in control or threatened change in control of Southern
Community Bancorp, all options granted prior to such event under the plan shall
become immediately exercisable. Unless otherwise determined by the board of
directors, the term "control" shall refer to the acquisition of ten percent
(10%) or more of the voting securities of Southern Community Bancorp by any
person or group acting in concert.

EMPLOYEE STOCK PURCHASE PLAN

We have established an employee stock purchase plan under which a total
of 15,000 shares of our common stock will be made available for sale to our
employees. The board of directors administers the plan. Employees are eligible
to participate in the plan if they are full-time employees employed by us or a
designated subsidiary for at least 90 consecutive days. The plan permits
eligible employees to purchase common stock through payroll deductions, which,
subject to certain limitations, may not exceed 10% of an employee's
compensation. The minimum purchase each month by an eligible employee is one
share of common stock. The purchase price of each share of common stock under
the purchase plan will be equal to the fair market value per share of common
stock on the date of purchase, but will never be less than $15.00 per share.

Eligible employees have the opportunity to enroll in the purchase plan
beginning on March 1 and ending on March 31 every year. Employees may terminate
their participation in the purchase plan at any time. Participation ends
automatically upon termination of employment. In the event that an employee
participating in the plan ceases to be our employee, we have the right to
repurchase all or any portion of the shares purchased by such employee under the
plan at any time during the following 24 months for a purchase price equal to
the fair market value of the stock at the time of such repurchase. The plan will
terminate upon the earlier of September 16, 2004, or the date all of the shares
reserved for purchase under the purchase plan have been purchased, unless the
board of directors terminates it sooner. The board of directors also has the
right to amend or suspend the plan at any time without prior notice.

CERTAIN TRANSACTIONS

From time to time, we make loans to our executive officers and
directors in accordance with our usual loan approval criteria. We made all such
loans on terms, including interest rates and collateral, and are subject to
conditions that are applicable to loans we make to unaffiliated parties. As of
the date of this prospectus, the aggregate balance of all such loans was
$4,763,000. In addition, we have approved an unsecured line of credit for each
of our directors, including the directors of our existing bank, in the amount of
$75,000. These lines of credit are subject to renewal on an annual basis. All
extensions of credit to executive officers and directors are subject to approval
by the full board of directors with the interested person abstaining from any
participation in the discussion or decision with respect to his or her own loan.

66
<PAGE> 72

Our existing bank has entered into a lease agreement with one of our
directors, Patrick Armstrong, pursuant to which the bank leases the site of its
Altamonte Springs branch office. The term of the lease is for a period of 20
years expiring in 2018 which may be extended by the bank for up to 10 additional
years. The rent payments are $10,070 per month through the first five years of
the lease, increasing at the rate of 4% per year thereafter.

Southern Community Insurance Agency, Inc., a wholly owned subsidiary of
our existing bank, has entered into a relationship with Insurance Office of
America, Inc., an insurance agency owned by one of our directors, John Ritenour.
Insurance Office of America, Inc. will pay Southern Community Insurance Agency,
Inc. a percentage of the commissions received by Insurance Office of America,
Inc. from the sale of insurance products to customers referred by Southern
Community Insurance Agency, Inc.

We will utilize a portion of the proceeds of the offering to pay the
organizers of our proposed new bank for the organizational costs which they have
incurred (and will incur) in establishing the new bank. The organizers of the
new bank are the persons designated as the proposed directors of the new bank,
including Mr. Brinkley and Mr. Squires. The organizational costs include annual
salaries of $120,000 currently being paid to Mr. Garner and Mr. Whittenhall. See
"Management - Proposed Executive Offices and Directors of Our Proposed New
Bank." We estimate that these costs will be approximately $500,000. If the
offering is not successful, the organizers of the new bank will be required to
bear all of these expenses.

We intend to grant stock options to each of the organizers of our
proposed new bank at the time it is opened, including Messrs. Brinkley and
Squires. These individuals will each receive options for 5,000 shares, with an
exercise price of $16.50 per share. These options will have substantially the
same terms as the stock options previously granted to our non-executive
directors.

67
<PAGE> 73
SECURITIES OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, as of March 31, 2000, the number and
percentage of shares of our outstanding common stock which are beneficially
owned, directly or indirectly, by:

o each shareholder who owns more than 5% of the outstanding shares;

o each of our directors;

o each of our executive officers; and

o all of our directors and executive officers as a group.

We determine beneficial ownership based on the rules of Securities and
Exchange Commission. In general, beneficial ownership includes shares over which
the indicated person has sole or shared voting or investment power and shares
which he or she has the right to acquire within 60 days of March 31, 2000.
Unless otherwise indicated, the persons listed have sole voting and investment
power over the shares beneficially owned.

POSITION WITH SHARES
SOUTHERN COMMUNITY BENEFICIALLY
NAME BANCORP OWNED PERCENTAGE
---- ------------------ ------------- ----------
<S> <C> <C> <C>
Charlie W. Brinkley, Jr. (1).......... Chairman and CEO 67,154 7.4%

John G. Squires (2)................... President, COO and 57,596 6.4%
Director

Patrick J. Armstrong (3).............. Director 43,333 4.8%

Richard M. Dunn (3)................... Director 43,333 4.8%

Jennings L. Hurt, III (3)............. Director 60,000 6.7%

Eugene M. Pascarella (3).............. Director 43,333 4.8%

Jon C. Peterson (3)................... Director 43,333 4.8%

John K. Ritenour (3).................. Director 50,000 5.6%

Stanley H. Sandefur (3)............... Director 59,999 6.7%

Stephen R. Jeuck (4).................. Secretary and CFO 1,802 *

All executive officers
and directors as a group
(10 persons)................... 469,883 47.7%

</TABLE>

-----------------
* Less than one percent (1%).
(1) Includes 10,000 shares that are subject to disposition restrictions, of
which 9,750 shares are subject to potential forfeiture and 7,000 shares
issuable upon exercise of outstanding stock options.
(2) Includes 7,000 shares issuable upon exercise of outstanding stock options.
(3) Includes 10,000 shares issuable upon exercise of outstanding stock options.
(4) Includes 800 shares issuable upon exercise of outstanding stock options.

BENEFICIAL OWNERSHIP OF MANAGEMENT FOLLOWING OFFERING

Our directors and officers have indicated that they intend to subscribe
to purchase a minimum of 120,000 shares in the offering, or a total of 120,000
shares. They plan to designate that their subscription funds be deposited in the
second escrow account. If we complete the offering by the sale of a minimum of
200,000 shares through the second escrow account and all directors acquire the
indicated number of shares, then our directors and executive officers would then
beneficially own 580,133 shares, or 49.7% of the total then outstanding. This
percentage would decrease to the extent we sell additional shares in the
offering.

The proposed directors of our proposed new bank, other than Messrs.
Brinkley and Squires, do not own any shares in our company. However, they have
indicated that they will subscribe to purchase a minimum 110,000 shares in the
offering. They plan to designate that their subscription funds be deposited in
the first escrow account. If we complete the offering by the sale of a minimum
of 610,000 shares through the first escrow account, then these directors would
beneficially own 160,000 shares, or 10.3% of the total then outstanding. This
calculation includes the issuance of 50,000 stock options to these directors.

68
<PAGE> 74

DESCRIPTION OF CAPITAL STOCK

Our authorized capital stock consists of 10,000,000 shares of common
stock, par value $1.00 per share. As of the date of this prospectus, 890,298
shares of our common stock were issued and outstanding.

COMMON STOCK

Subject to the rights of the holders of any outstanding shares of
preferred stock, holders of common stock are entitled to receive ratably
dividends, if any, declared by the board of directors out of funds legally
available for dividends. See "Dividend Policy." In the event of the liquidation,
dissolution or winding up of Southern Community Bancorp, holders of our common
stock are entitled to share ratably, based on the number of shares held, in the
assets, remaining after payment of all the debts and liabilities of Southern
Community Bancorp.

Holders of common stock are entitled to one vote per share on all
matters submitted to the holders of common stock for a vote. Because holders of
common stock do not have cumulative voting rights with respect to the election
of directors, the holders of a majority of the shares of common stock
represented at a meeting can elect all of the directors. Holders of common stock
do not have preemptive or other rights to subscribe for or purchase any
additional shares of capital stock issued by Southern Community Bancorp or to
convert their common stock into any other securities. There are no redemption or
sinking fund provisions applicable to the common stock.

ANTI-TAKEOVER PROVISIONS

GENERAL. The Florida Business Corporation Act contains provisions
designed to enhance the ability of the board of directors to respond to attempts
to acquire control of Southern Community Bancorp. These provisions may
discourage takeover attempts which have not been approved by the board of
directors. This could include takeover attempts that some of our shareholders
deem to be in their best interest. These provisions may adversely affect the
price that a potential purchaser would be willing to pay for our common stock.
These provisions may deprive you of the opportunity to obtain a takeover premium
for your shares. These provisions could make the removal of incumbent management
more difficult. These provisions may enable a minority of our directors and the
holders of a minority of our outstanding voting stock to prevent, discourage or
make more difficult a merger, tender offer or proxy contest, even though the
transaction may be favorable to the interests of shareholders. These provisions
could also potentially adversely affect the market price of the common stock.

The following summarizes the anti-takeover provisions contained in the
Florida Business Corporation Act.

AUTHORIZED BUT UNISSUED STOCK. The authorized but unissued shares of
common stock will be available for future issuance without shareholder approval.
These additional shares may be used for a variety of corporate purposes,
including future public offerings to raise additional capital, corporate
acquisitions and employee benefit plans. The existence of authorized but
unissued shares of common stock may enable our board of directors to issue
shares of stock to persons friendly to

<PAGE> 75

existing management. This may have the effect of discouraging attempts to obtain
control of Southern Community Bancorp.

EVALUATION OF ACQUISITION PROPOSALS. The Florida Business Corporation
Act expressly permits the board of directors, when evaluating any proposed
tender or exchange offer, any merger, consolidation or sale of substantially all
of the assets of Southern Community Bancorp, or any similar extraordinary
transaction, to consider all relevant factors including, without limitation, the
social, legal, and economic effects on the employees, customers, suppliers, and
other constituencies of Southern Community Bancorp and its subsidiaries, on the
communities and geographical areas in which Southern Community Bancorp and its
subsidiaries. The board of directors may also consider the amount of
consideration being offered in relation to the then current market price for
outstanding shares of capital stock and the then current value of Southern
Community Bancorp in a freely negotiated transaction. The board of directors
believes that these provisions are in the long-term best interests of Southern
Community Bancorp and its shareholders.

CONTROL SHARE ACQUISITIONS. We are subject to the Florida control share
acquisitions statute. This statute is designed to afford shareholders of public
corporations in Florida protection against acquisitions in which a person,
entity or group seeks to gain voting control. With enumerated exceptions, the
statute provides that shares acquired within certain specific ranges will not
possess voting rights in the election of directors unless the voting rights are
approved by a majority vote of the public corporation's disinterested
shareholders. Disinterested shares are shares other than those owned by the
acquiring person or by a member of a group with respect to a control share
acquisition, or by any officer of the corporation or any employee of the
corporation who is also a director. The specific acquisition ranges that trigger
the statute are:

o acquisitions of shares possessing one-fifth or more but less
than one-third of all voting power;

o acquisitions of shares possessing one-third or more but less
than a majority of all voting power;

o or acquisitions of shares possessing a majority of more of all
voting power.

Under certain circumstances, the statute permits the acquiring person to call a
special shareholders meeting for the purpose of considering the grant of voting
rights to the holder of the control shares. The statute also enables a
corporation to provide for the redemption under certain circumstances of control
shares with no voting rights.

TRANSACTIONS WITH INTERESTED SHAREHOLDERS. We are subject to the
Florida affiliated transactions statute which generally requires approval by the
disinterested directors or supermajority approval by shareholders for certain
specified transactions between a corporation and a holder, or its affiliates, of
more than 10% of the outstanding shares of the corporation. These provisions
could prohibit or delay the accomplishment of mergers or other takeover or
change in control attempts. Accordingly, these provisions may discourage
attempts to acquire Southern Community Bancorp.

<PAGE> 76
TRANSFER AGENT AND REGISTRAR

Unless we otherwise become required by law or administrative action to
appoint an independent transfer agent and registrar, or our board of directors
otherwise deems it appropriate to do so, we will act as transfer agent and
registrar for our common stock.

LIMITED LIABILITY AND INDEMNIFICATION

Under the Florida Business Corporation Act, a director is not
personally liable for monetary damages to the corporation or any other person
for any statement, vote, decision, or failure to act unless:

o the director breached or failed to perform his duties as a
director and

o a director's breach of, or failure to perform, those duties
constitutes:

o a violation of the criminal law, unless the director had
reasonable cause to believe his conduct was lawful or had no
reasonable cause to believe his conduct was unlawful,

o a transaction from which the director derived an improper
personal benefit, either directly or indirectly,

o a circumstance under which an unlawful distribution is made,

o in a proceeding by or in the right of the corporation to
procure a judgment in its favor or by or in the right of a
shareholder, conscious disregard for the best interest of the
corporation or willful misconduct, or

o in a proceeding by or in the right of someone other than the
corporation or a shareholder, recklessness or an act or
omission which was committed in bad faith or with malicious
purpose or in a manner exhibiting wanton and willful disregard
of human rights, safety, or property.

A corporation may purchase and maintain insurance on behalf of any
director or officer against any liability asserted against him and incurred by
him in his capacity or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liability under
the Florida Business Corporation Act.

The articles of incorporation and bylaws of Southern Community Bancorp
provide that we shall, to the fullest extent permitted by applicable law, as
amended from time to time, indemnify all directors of Southern Community
Bancorp, as well as any officers or employees of Southern Community Bancorp to
whom we have agreed to grant indemnification.

<PAGE> 77

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of the offering, we will have a minimum of 1,090,298
shares and a maximum of 1,940,298 shares of common stock outstanding. Except for
shares held by an affiliates, almost all of our outstanding shares will be
freely tradeable without restriction or registration under the Securities Act of
1933. Our affiliates will need to comply with the resale limitations of Rule 144
under the Securities Act of 1933. Rule 144 defines an "affiliate" as a person
who directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, a company. Affiliates of a
company generally include its directors, officers and principal shareholders and
the directors and executive officers of its principal subsidiaries.

Purchasers of the common stock in the offering, other than affiliates,
may resell their shares immediately. Our affiliates will be subject to the
volume and other limitations of Rule 144. Rule 144 in general permits affiliates
to sell within any three-month period a number of shares that does not exceed
the greater of one percent of the outstanding shares of common stock or the
average weekly trading volume during the four calendar weeks preceding his or
her sale. Sales under Rule 144 are also subject to manner of sale provisions,
notice requirements and the availability of current public information about
Southern Community Bancorp.

<PAGE> 78

LEGAL MATTERS

The validity of the common stock offered hereby will be passed upon for
Southern Community Bancorp by Shutts & Bowen LLP, Orlando, Florida.

EXPERTS

The consolidated financial statements of Southern Community Bancorp as
of December 31, 1999 and 1998, included in this prospectus have been audited by
Hacker, Johnson, Cohen & Grieb, P.A., independent certified public accountants,
as stated in their opinion, which has been rendered upon the authority of said
firm as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We have filed a registration statement on Form SB-2 with the SEC to
register the common stock we will issue in the offering. As permitted by the
rules and regulations of the SEC, this prospectus does not contain all of the
information that you can find in the registration statement and its exhibits.

You may read and copy our registration statement, and any reports and
other information which we may file with the SEC at the SEC's public reference
rooms in Washington, D.C., New York or Chicago, Illinois. You may call the SEC
at 1-800-SEC-0330 for further information on the public reference rooms.

The SEC also maintains a website that contains reports, proxy and
information statements and other information regarding registrants such as
Southern Community Bancorp that file electronically with the Securities and
Exchange Commission. The address of this website is http://www.sec.gov.

We have filed or will file various applications with the Florida
Department of Banking and Finance, the FDIC and the Federal Reserve. You should
rely only on information in this prospectus and in our related registration
statement in making an investment decision. If other available information is
inconsistent with information in this prospectus, including information in
public files or provided by the bank regulatory agencies, such other information
is superseded by the information in this prospectus. Projections appearing in
the applications to such agencies were based on assumptions that the organizers
believed were reasonable at the time, but which may have changed or may
otherwise be wrong. Southern Community Bancorp, Southern Community Bank and
Southern Community Bank of Southwest Florida (in organization) specifically
disclaim all projections for purposes of this prospectus and caution prospective
investors against placing reliance on them for purposes of making an investment
decision.

<PAGE> 79

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<S> <C>
Independent Auditors' Report.................................................................................F-2

Consolidated Balance Sheets, December 31, 1999 and 1998......................................................F-3

Consolidated Statements of Operations for the Year Ended December 31, 1999 and
for the Period from December 15, 1998
(commencement of banking operations) to December 31, 1998..............................................F-4

Consolidated Statements of Changes in Stockholders' Equity for the Year Ended
December 31, 1999 and for the Period from December 15, 1998
(commencement of banking operations)
to December 31, 1998...................................................................................F-5

Consolidated Statements of Cash Flows for the Year Ended December 31, 1999 and
for the Period from December 15, 1998
(commencement of banking operations) to December 31, 1998..............................................F-6

Notes to Consolidated Financial Statements for the Year Ended December 31,
1999 and for the Period from December 15, 1998
(commencement of banking operations) to December 31, 1998.......................................F-7 - F-22

Condensed Consolidated Balance Sheets (Unaudited), March 31, 2000 and 1999..................................F-23

Condensed Consolidated Statements of Operations (Unaudited)
for the Three Months Ended March 31, 2000 and 1999....................................................F-24

Condensed Consolidated Statements of Cash Flows (Unaudited)
for the Three Months Ended March 31, 2000 and 1999....................................................F-25

Condensed Consolidated Statement of Changes in Stockholders' Equity
(Unaudited) for the Three Months Ended March 31, 2000.................................................F-26

Notes to Condensed Consolidated Financial Statements (Unaudited).....................................F-27 - F-28

</TABLE>

All schedules are omitted because of the absence of the conditions
under which they are required or because the required information is included in
the Consolidated Financial Statements and related Notes.

F-1
<PAGE> 80

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Southern Community Bancorp
Orlando, Florida:

We have audited the accompanying consolidated balance sheets of
Southern Community Bancorp and its wholly-owned subsidiary, Southern Community
Bank (together, the "Company") at December 31, 1999 and 1998, and the related
consolidated statements of operations, changes in stockholders' equity and cash
flows for the year ended December 31, 1999 and for the period from December 15,
1998 (commencement of banking operations) to December 31, 1998. 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 audits 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 the Company
at December 31, 1999 and 1998, and the results of its operations and its cash
flows for the year ended December 31, 1999 and for the period from December 15,
1998 (commencement of banking operations) to December 31, 1998, in conformity
with generally accepted accounting principles.

HACKER, JOHNSON, COHEN & GRIEB PA
Orlando, Florida
January 26, 2000

F-2
<PAGE> 81

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
AT DECEMBER 31,
------------------------
1999 1998
---- ----
ASSETS
<S> <C> <C>
Cash and due from banks $ 4,519,649 133,920
Federal funds sold -- 13,124,000
------------ ------------

Cash and cash equivalents 4,519,649 13,257,920

Securities available for sale 11,997,900 --
Loans receivable, net of allowance for loan losses of
$621,000 in 1999 and $12,000 in 1998 61,362,573 1,202,605
Accrued interest receivable 554,036 31,061
Federal Home Loan Bank stock, at cost 212,400 --
Premises and equipment, net 4,317,768 1,850,072
Deferred income tax asset 811,146 148,031
Other assets 88,696 116,748
------------ ------------

Total assets $ 83,864,168 16,606,437
============ ============

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:
Noninterest-bearing demand deposits 10,768,768 57,740
Money-market deposits 14,051,702 3,152,763
Savings and NOW deposits 5,757,244 35,371
Time deposits 34,485,277 27,730
------------ ------------

Total deposits 65,062,991 3,273,604

Federal funds purchased 6,000,000 --
Official checks 662,237 1,035,385
Accrued interest payable and other liabilities 300,453 64,749
------------ ------------

Total liabilities 72,025,681 4,373,738
------------ ------------

Commitments and contingencies (Notes 4, 6, 7 and 16)

Stockholders' equity:
Common stock, $1 par value, 10,000,000 shares authorized,
884,425 and 834,425 shares issued and outstanding 884,425 834,425
Additional paid-in capital 12,381,950 11,681,950
Accumulated deficit (1,225,661) (283,676)
Accumulated other comprehensive income (loss) (202,227) --
------------ ------------

Total stockholders' equity 11,838,487 12,232,699
------------ ------------

Total liabilities and stockholders' equity $ 83,864,168 16,606,437
============ ============

</TABLE>

See accompanying Notes to Consolidated Financial Statements.

F-3
<PAGE> 82

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
PERIOD FROM
DECEMBER 15, 1998
(COMMENCEMENT
OF BANKING
YEAR ENDED OPERATIONS) TO
DECEMBER 31, DECEMBER 31,
----------- -------------
1999 1998
---- ----
<S> <C> <C>
Interest income:
Loans receivable $ 2,715,861 3,908
Securities available for sale 398,178 --
Other interest-earning assets 285,012 28,311
----------- -----------

Total interest income 3,399,051 32,219
----------- -----------

Interest expense:
Deposits 1,168,568 6,641
Other borrowings 17,171 --
----------- -----------

Total interest expense 1,185,739 6,641
----------- -----------

Net interest income 2,213,312 25,578

Provision for loan losses 609,000 12,000
----------- -----------

Net interest income after provision for loan losses 1,604,312 13,578
----------- -----------

Noninterest income:
Service charges on deposit accounts 53,036 --
Other service charges and fees 62,858 --
----------- -----------

Total noninterest income 115,894 --
----------- -----------

Noninterest expense:
Salaries and employee benefits 1,464,520 46,659
Occupancy expense 804,439 15,593
Data processing 127,413 10,092
Printing and office supplies 148,313 5,356
Marketing and advertising 173,586 1,521
Professional fees 135,682 1,000
Telephone 71,354 490
Travel and entertainment 54,562 1,301
Other 236,545 1,871
----------- -----------

Total noninterest expense 3,216,414 83,883
----------- -----------

Loss before income tax benefit (1,496,208) (70,305)

Income tax benefit (554,223) (26,282)
----------- -----------

Net loss $ (941,985) (44,023)
=========== ===========

Basic and diluted loss per share $ (1.10) (.05)
=========== ===========

Weighted-average number of common shares outstanding $ 855,258 834,425
=========== ===========

</TABLE>

See accompanying Notes to Consolidated Financial Statements.

F-4
<PAGE> 83

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
ACCUMULATED
OTHER
COMPRE-
ADDITIONAL HENSIVE TOTAL
COMMON PAID-IN ACCUMULATED INCOME STOCKHOLDERS'
STOCK CAPITAL DEFICIT (LOSS) EQUITY
----- ------- ------- ------ ------
<S> <C> <C> <C> <C> <C>
Balance at December 15, 1998
(Commencement of
banking operations) $ 834,425 11,681,950 (239,653) -- 12,276,722

Comprehensive income (loss) -
Net loss for the period -- -- (44,023) -- (44,023)
----------- ----------- ----------- ----------- -----------

Balance at December 31, 1998 834,425 11,681,950 (283,676) -- 12,232,699
-----------

Comprehensive income (loss):
Net loss for the year -- -- (941,985) -- (941,985)

Net change in unrealized loss on
securities available for sale,
net of tax -- -- -- (202,227) (202,227)
-----------

Comprehensive income (loss) (1,144,212)

Sale of common stock (50,000
shares) 50,000 700,000 -- -- 750,000
----------- ----------- ----------- ----------- -----------

Balance at December 31, 1999 $ 884,425 12,381,950 (1,225,661) (202,227) 11,838,487
=========== =========== =========== =========== ===========

</TABLE>

See accompanying Notes to Consolidated Financial Statements.

F-5
<PAGE> 84

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
Period From
December 15, 1998
(Commencement
Of Banking
Year Ended Operations) To
December 31, December 31,
------------ --------------
1999 1998
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (941,985) (44,023)
Adjustments to reconcile net loss to net cash
(used in) provided by operating activities:
Provision for loan losses 609,000 12,000
Depreciation and amortization 184,180 6,144
Credit for deferred income taxes (554,223) (26,282)
Accretion of discounts on securities (11,552) --
Increase in accrued interest receivable (522,975) (31,061)
Decrease (increase) in other assets 28,052 (116,748)
(Decrease) increase in official checks (373,148) 1,035,385
Increase in accrued interest payable and other liabilities 235,704 42,845
------------ ------------

Net cash (used in) provided by operating
activities (1,346,947) 878,260
------------ ------------

Cash flows from investing activities:
Repayments of securities available for sale 18,005 --
Purchases of securities available for sale (12,315,472) --
Net increase in loans (60,768,968) (1,214,605)
Purchases of premises and equipment (2,651,876) (1,856,216)
Purchases of Federal Home Loan Bank stock (212,400) --
------------ ------------

Net cash used in investing activities (75,930,711) (3,070,821)
------------ ------------

Cash flows from financing activities:
Net increase in deposits 61,789,387 3,273,604
Net increase in Federal funds purchased 6,000,000 --
Proceeds from issuance of common stock 750,000 --
------------ ------------

Net cash provided by financing activities 68,539,387 3,273,604
------------ ------------

Net (decrease) increase in cash and cash equivalents (8,738,271) 1,081,043

Cash and cash equivalents at beginning of period 13,257,920 12,176,877
------------ ------------

Cash and cash equivalents at end of period $ 4,519,649 13,257,920
============ ============

Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 1,070,498 3,448
============ ============

Income taxes $ -- --
============ ============

Noncash investing activities-
Accumulated other comprehensive income, unrealized
loss on securities available for sale, net of tax $ (202,227) --
============ ============

</TABLE>

See accompanying Notes to Consolidated Financial Statements.

F-6
<PAGE> 85

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED DECEMBER 31, 1999 AND FOR THE
PERIOD FROM DECEMBER 15, 1998 (COMMENCEMENT OF
BANKING OPERATIONS) TO DECEMBER 31, 1998

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION. Southern Community Bancorp (the "Holding Company") owns 100%
of the outstanding common stock of Southern Community Bank (the "Bank")
(collectively the "Company"). The Holding Company operates as a one-bank
holding company. On April 15, 1999, the Bank?s stockholders approved a
plan of corporate reorganization under which the Bank became a
wholly-owned subsidiary of the Holding Company. The Holding Company was
formed on July 30, 1999. The Bank's stockholders exchanged their common
shares for shares of the Holding Company. As a result, all of the
previously issued $7.50 par value common shares of the Bank were
exchanged for 834,425 shares of the $1.00 par value common shares of the
Holding Company. The Holding Company's acquisition of the Bank has been
accounted for similar to a pooling of interests and, accordingly, the
financial data for periods presented include the results of the Bank.

The Holding Company?s only business activity is the operation of the
Bank. The Bank is a state (Florida) chartered commercial bank. The Bank
began its organizational phase in March of 1998. These financial
statements do not include the organizational phase of the Bank. The
consolidated 1998 financial statements include the operations of the
Bank from December 15, 1998 (the date of the commencement of banking
operations) to December 31, 1998. The Bank offers a variety of financial
services to individual and corporate customers through its four banking
offices located in Orange and Seminole Counties, Florida. The deposits
of the Bank are insured by the Federal Deposit Insurance Corporation
("FDIC") through the Bank Insurance Fund ("BIF").

BASIS OF PRESENTATION. The accompanying consolidated financial statements
include the accounts of the Holding Company and the Bank. All
significant intercompany accounts and transactions have been eliminated
in consolidation. The accounting and reporting practices of the Company
conform to generally accepted accounting principles and to general
practices within the banking industry. The following summarizes the more
significant of these policies and practices:

USE OF ESTIMATES. In preparing consolidated financial statements in
conformity with generally accepted accounting principles, management is
required to make estimates and assumptions that affect the reported
amounts of assets and liabilities as of the date of the balance sheet
and reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates. Material
estimates that are particularly susceptible to significant change in the
near term relate to the determination of the allowance for loan losses
and deferred tax assets.

CASH AND CASH EQUIVALENTS. For purposes of the consolidated statements of
cash flows, cash and cash equivalents include cash and balances due from
banks and federal funds sold.

(continued)

F-7
<PAGE> 86

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
SECURITIES. The Company may classify its securities as either trading, held
to maturity or available for sale. Trading securities are held
principally for resale and recorded at their fair values. Unrealized
gains and losses on trading securities are included immediately in
earnings. Held-to-maturity securities are those which the Company has
the positive intent and ability to hold to maturity and are reported at
amortized cost. Available-for-sale securities consist of securities not
classified as trading securities nor as held-to-maturity securities.
Unrealized holding gains and losses, net of tax, on available-for-sale
securities are excluded from earnings and reported in other
comprehensive income. Gains and losses on the sale of available-for-sale
securities are recorded on the trade date and are determined using the
specific-identification method. Premiums and discounts on securities are
recognized in interest income using the interest method over the period
to maturity.

LOANS RECEIVABLE. Loans receivable that management has the intent and
ability to hold for the foreseeable future or until maturity or pay-off
are reported at their outstanding principal adjusted for any
charge-offs, the allowance for loan losses, and any deferred fees or
costs on originated loans.

Loan origination fees and certain direct origination costs are
capitalized and recognized as an adjustment of the yield of the related
loan.

The accrual of interest on loans is discontinued at the time the loan is
90 days delinquent unless the credit is well-secured and in process of
collection. In all cases, loans are placed on nonaccrual or charged-off
at an earlier date if collection of principal or interest is considered
doubtful.

All interest accrued but not collected for loans that are placed on
nonaccrual or charged-off is reversed against interest income. The
interest on these loans is accounted for on the cash-basis or
cost-recovery method, until qualifying for return to accrual. Loans are
returned to accrual status when all the principal and interest amounts
contractually due are brought current and future payments are reasonably
assured.

ALLOWANCE FOR LOAN LOSSES. The allowance for loan losses is established as
losses are estimated to have occurred through a provision for loan
losses charged to earnings. Loan losses are charged against the
allowance when management believes the uncollectibility of a loan
balance is confirmed. Subsequent recoveries, if any, are credited to the
allowance.

The allowance for loan losses is evaluated on a regular basis by
management and is based upon management's periodic review of the
collectibility of the loans in light of historical experience, the
nature and volume of the loan portfolio, adverse situations that may
affect the borrower's ability to repay, estimated value of any
underlying collateral and prevailing economic conditions. This
evaluation is inherently subjective as it requires estimates that are
susceptible to significant revision as more information becomes
available.

(continued)

F-8
<PAGE> 87

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
ALLOWANCE FOR LOAN LOSSES, CONTINUED. A loan is considered impaired when,
based on current information and events, it is probable that the Company
will be unable to collect the scheduled payments of principal or interest
when due according to the contractual terms of the loan agreement.
Factors considered by management in determining impairment include
payment status, collateral value, and the probability of collecting
scheduled principal and interest payments when due. Loans that experience
insignificant payment delays and payment shortfalls generally are not
classified as impaired. Management determines the significance of payment
delays and payment shortfalls on a case-by-case basis, taking into
consideration all of the circumstances surrounding the loan and the
borrower, including the length of the delay, the reasons for the delay,
the borrower's prior payment record, and the amount of the shortfall in
relation to the principal and interest owed. Impairment is measured on a
loan by loan basis for commercial loans by either the present value of
expected future cash flows discounted at the loan's effective interest
rate, the loan's obtainable market price, or the fair value of the
collateral if the loan is collateral dependent.

Large groups of smaller balance homogeneous loans are collectively evaluated
for impairment. Accordingly, the Company does not separately identify
individual consumer and residential loans for impairment disclosures.

PREMISES AND EQUIPMENT. Land is carried at cost. Premises, furniture and
equipment, and leasehold improvements are carried at cost, less
accumulated depreciation and amortization computed principally using the
straight-line method. The Company amortizes leasehold improvements over
the lease term, which could include lease renewal periods, if it is the
intent of management to exercise the renewal option on the lease.

TRANSFER OF FINANCIAL ASSETS. Transfers of financial assets are accounted
for as sales, when control over the assets has been surrendered. Control
over transferred assets is deemed to be surrendered when (1) the assets
have been isolated from the Company, (2) the transferee obtains the
right (free of conditions that constrain it from taking advantage of
that right) to pledge or exchange the transferred assets, and (3) the
Company does not maintain effective control over the transferred assets
through an agreement to repurchase them before their maturity.

INCOME TAXES. Deferred tax assets and liabilities are determined using the
liability (or balance sheet) method. Under this method, the net deferred
tax asset or liability is determined based on the tax effects of the
temporary differences between the book and tax bases of the various
balance sheet assets and liabilities and gives current recognition to
changes in tax rates and laws.

ORGANIZATIONAL COSTS. Preopening and organizational expenses totaled
$239,653 (net of tax effect of $121,749) and were charged to expense as
incurred during the organizational phase.

(continued)

F-9
<PAGE> 88

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
STOCK COMPENSATION PLANS. Statement of Financial Accounting Standards (SFAS)
No. 123, ACCOUNTING FOR STOCK-BASED COMPENSATION, encourages all
entities to adopt a fair value based method of accounting for employee
stock compensation plans, whereby compensation cost is measured at the
grant date based on the value of the award and is recognized over the
service period, which is usually the vesting period. However, it also
allows an entity to continue to measure compensation cost for those
plans using the intrinsic value based method of accounting prescribed by
Accounting Principles Board Opinion No. 25, ACCOUNTING FOR STOCK ISSUED
TO EMPLOYEES, whereby compensation cost is the excess, if any, of the
quoted market price of the stock at the grant date (or other measurement
date) over the amount an employee must pay to acquire the stock. Stock
options issued under the Company's stock option plan have no intrinsic
value at the grant date, and under Opinion No. 25 no compensation cost
is recognized for them. The Company has elected to continue with the
accounting methodology in Opinion No. 25 and, as a result, has provided
proforma disclosures of net loss and other disclosures, as if the fair
value based method of accounting had been applied. (See Note 11).

OFF-BALANCE SHEET INSTRUMENTS. In the ordinary course of business, the
Company has entered into off-balance-sheet instruments consisting of
commitments to extend credit, standby letters of credit, undisbursed
loans in process and unused lines of credit. Such financial instruments
are recorded in the financial statements when they are funded.

FAIRVALUES OF FINANCIAL INSTRUMENTS. The fair value of a financial
instrument is the current amount that would be exchanged between willing
parties, other than in a forced liquidation. Fair value is best
determined based upon quoted market prices. However, in many instances,
there are no quoted market prices for the Company's various financial
instruments. In cases where quoted market prices are not available, fair
values are based on estimates using present value or other valuation
techniques. Those techniques are significantly affected by the
assumptions used, including the discount rate and estimates of future
cash flows. Accordingly, the fair value estimates may not be realized in
an immediate settlement of the instrument. SFAS 107 excludes certain
financial instruments and all nonfinancial instruments from its
disclosure requirements. Accordingly, the aggregate fair value amounts
presented may not necessarily represent the underlying fair value of the
Company. The following methods and assumptions were used by the Company
in estimating fair values of financial instruments:

CASH AND CASH EQUIVALENTS. The carrying amounts of cash and cash
equivalents approximate their fair value.

SECURITIES. Fair values for securities available for sale are based on
quoted market prices, where available. If quoted market prices are not
available, fair values are based on quoted market prices of comparable
instruments. The carrying amount of Federal Home Loan Bank stock
approximates fair value.

LOANS. For variable-rate loans that reprice frequently and have no
significant change in credit risk, fair values are based on carrying
values. Fair values for fixed-rate mortgage (e.g. one-to-four family
residential), commercial real estate and commercial loans are estimated
using discounted cash flow analyses, using interest rates currently
being offered for loans with similar terms to borrowers of similar
credit quality. Fair values for nonperforming loans are estimated using
discounted cash flow analysis or underlying collateral values, where
applicable.

(continued)

F-10
<PAGE> 89

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
FAIR VALUES OF FINANCIAL INSTRUMENTS, CONTINUED.
ACCRUED INTEREST RECEIVABLE. Book value approximates fair value.

DEPOSIT LIABILITIES. The fair values disclosed for demand, NOW,
money-market and savings deposits are, by definition, equal to the
amount payable on demand at the reporting date (that is, their carrying
amounts). Fair values for fixed-rate certificates of deposit are
estimated using a discounted cash flow calculation that applies interest
rates currently being offered on certificates to a schedule of
aggregated expected monthly maturities of time deposits.

FEDERAL FUNDS PURCHASED. The carrying amount of federal funds purchased
approximates fair value.

OFF-BALANCE-SHEET INSTRUMENTS. Fair values for off-balance-sheet lending
commitments are based on fees currently charged to enter into similar
agreements, taking into account the remaining terms of the agreements
and the counterparties' credit standing.

LOSS PER SHARE. Basic and diluted loss per share is calculated by dividing
net loss by the weighted average number of shares of common stock
outstanding during the period. Outstanding stock options are not
dilutive due to the net losses incurred by the Company.

ADVERTISING. The Company expenses all media advertising as incurred.

FUTURE ACCOUNTING REQUIREMENTS. Financial Accounting Standards No. 133 -
ACCOUNTING FOR DERIVATIVE INVESTMENTS AND HEDGING ACTIVITIES requires
companies to record derivatives on the balance sheet as assets or
liabilities, measured at fair value. Gains or losses resulting from
changes in the values of those derivatives would be accounted for
depending on the use of the derivatives and whether they qualify for
hedge accounting. The key criterion for hedge accounting is that the
hedging relationship must be highly effective in achieving offsetting
changes in fair value or cash flows. The Company will be required to
adopt this Statement effective January 1, 2001. Management does not
anticipate that this Statement will have a material impact on the
Company.

(continued)

F-11
<PAGE> 90

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(2) SECURITIES AVAILABLE FOR SALE

Securities have been classified according to management's intent. The
carrying amount of securities and their approximate fair value at
December 31, 1999 are summarized as follows:

<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE
---- ----- ------ -----
<S> <C> <C> <C> <C>
U.S. governments agency securities $10,336,148 19,760 (297,714) 10,058,194
Mortgage-backed security 1,972,871 -- (33,165) 1,939,706
----------- ----------- ----------- -----------

$12,309,019 19,760 (330,879) 11,997,900
=========== =========== =========== ===========
</TABLE>

There was no sales of securities in 1999 or 1998.

At December 31, 1999, the Company has pledged securities with a
carrying value of approximately $2.4 million for public deposits.

The scheduled maturities at December 31, 1999 are as follows:

AMORTIZED FAIR
COST VALUE
--------- ------

Due from one to five years $ 2,686,610 2,565,313
Due from five to ten years 7,649,538 7,492,881
Mortgage-backed security 1,972,871 1,939,706
----------- -----------

$12,309,019 11,997,900
=========== ===========
(3) LOANS

The components of loans were as follows:

AT DECEMBER 31,
------------------------
1999 1998
---- ----

Commercial $ 19,122,523 1,092,911
Commercial real estate 26,450,845 --
Residential real estate 12,915,102 50,308
Consumer and other 3,535,775 71,386
------------ ------------

Total loans 62,024,245 1,214,605

Less:
Allowance for loan losses (621,000) (12,000)
Net deferred loan fees (40,672) --
------------ ------------

Loans receivable, net $ 61,362,573 1,202,605
============ ============

(continued)

F-12
<PAGE> 91

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(3) LOANS, CONTINUED

The following is a summary of the activity in the allowance for loan losses:

YEAR ENDED PERIOD ENDED
DECEMBER 31, DECEMBER 31,
------------ ------------
1999 1998
---- ----

Allowance, at beginning of period $ 12,000 --
Provision for loan losses 609,000 12,000
--------- ------

Allowance, at end of period $ 621,000 12,000
========= ======

There were no impaired loans recognized under SFAS 114 and 118 during 1999
or 1998.

(4) PREMISES AND EQUIPMENT
Premises and equipment were as follows:

AT DECEMBER 31,
-----------------------
1999 1998
---- ----
Cost:
Land $ 450,000 450,000
Building 839,514 672,166
Leasehold improvements 2,110,188 428,816
Furniture and equipment 1,108,390 305,234
----------- -----------

Total cost 4,508,092 1,856,216

Less accumulated depreciation (190,324) (6,144)
----------- -----------

Net book value $ 4,317,768 1,850,072
=========== ===========

The Company leases three of its office facilities under operating leases.
The leases contain escalation clauses and have renewal options from 5 to
15 years. Rent expense under operating leases for the year ended December
31, 1999 and for the period from December 15, 1998 (commencement of
banking operations) to December 31, 1998 was approximately $327,000 and
$6,500, respectively. Future minimum rental commitments under
noncancelable leases are as follows:

YEAR ENDING DECEMBER 31: AMOUNT
------------------------ ------

2000 $ 376,914
2001 411,599
2002 430,338
2003 433,135
2004 364,300
2005 and thereafter 1,436,401
-----------

$ 3,452,687
===========

In January 2000, the Company purchased land in Bonita Springs, Florida for
approximately $725,000 for a future branch site. The Company will
purchase a temporary building unit for approximately $100,000 until
construction of the new branch is completed (see Note 17).

(continued)

F-13
<PAGE> 92

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(5) DEPOSITS

The aggregate amount of jumbo certificates of deposit with a minimum
denomination of $100,000, were approximately $19.3 million at December
31, 1999.

At December 31, 1999, the scheduled maturities of certificates of deposit
were as follows:

YEAR ENDING DECEMBER 31, AMOUNT
------------------------ ------

2000 $ 27,890,399
2001 6,309,342
2002 259,645
2004 25,891
-------------

$ 34,485,277
=============

(6) BENEFIT AGREEMENTS

The Company has entered into Salary Continuation Agreements (the
"Agreements") with the Chairman of the Board of Directors ("Chairman")
and the President/Chief Executive Officer ("CEO") which requires the
Company to provide salary continuation benefits to them upon retirement.
The Agreements require the Company to pay annual benefits for up to
twenty years following their normal retirement ages. The Agreements also
provide for salary continuation in the event of a change in control of
the Company, for early voluntary termination by the officers, based on a
ten-year vesting schedule, and for disability benefits. The Company is
accruing the present value of the future benefits to be paid over the
terms of the Agreements using a discount rate of 7.5%, assuming the
officers will retire at their normal retirement age. Expense relating to
these Agreements was $38,817 and $16,211 for the year ended December 31,
1999 and for the period from December 15, 1998 (commencement of banking
operations) to December 31, 1998, respectively. As of December 31, 1999,
the Company has accrued $55,028 related to these Agreements.

(continued)

F-14
<PAGE> 93

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(7) FINANCIAL INSTRUMENTS

The Company is a party to financial instruments with off-balance-sheet risk
in the normal course of business to meet the financing needs of its
customers. These financial instruments are commitments to extend credit,
standby letters of credit, undisbursed loans in process and unused lines
of credit and may involve, to varying degrees, elements of credit and
interest-rate risk in excess of the amount recognized in the balance
sheet. The contract amounts of these instruments reflect the extent of
involvement the Company has in these financial instruments.

The Company's exposure to credit loss in the event of nonperformance by the
other party to the financial instrument for commitments to extend credit
is represented by the contractual amount of those instruments. The
Company uses the same credit policies in making commitments as it does
for on-balance-sheet instruments.

Commitments to extend credit are agreements to lend to a customer as long as
there is no violation of any condition established in the contract.
Commitments generally have fixed expiration dates or other termination
clauses and may require payment of a fee. Since some of the commitments
are expected to expire without being drawn upon, the total commitment
amounts do not necessarily represent future cash requirements. The
Company evaluates each customer's credit worthiness on a case-by-case
basis. The amount of collateral obtained if deemed necessary by the
Company upon extension of credit is based on management's credit
evaluation of the counterparty.

Standby letters of credit are conditional commitments issued by the Company
to guarantee the performance of a customer to a third party. The credit
risk involved is essentially the same as that involved in extending loans
to customers.

The estimated fair values of the Company's financial instruments were as
follows (in thousands):

<TABLE>
<CAPTION>
AT DECEMBER 31,
---------------------------------------
1999 1998
----------------- -----------------
CARRYING FAIR CARRYING FAIR
AMOUNT VALUE AMOUNT VALUE
------ ----- ------ -----
<S> <C> <C> <C> <C>
Financial assets:
Cash and cash equivalents $ 4,520 4,520 13,258 13,258
Securities available for sale 11,998 11,998 -- --
Loans receivable, net 61,363 61,316 1,203 1,203
Accrued interest receivable 554 554 31 31
Federal Home Loan Bank stock 212 212 -- --

Financial liabilities:
Deposit liabilities 65,063 64,598 3,274 3,274
Federal funds purchased 6,000 6,000 -- --

(continued)

</TABLE>

F-15
<PAGE> 94

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(7) FINANCIAL INSTRUMENTS, CONTINUED

A summary of the notional amounts of the Company's financial instruments
which approximates fair value, with off-balance-sheet risk at December
31, 1999, follows:

Commitments to extend credit $24,642,000
===========

Standby letters of credit $ 1,043,000
===========

Undisbursed loans in process $ 8,925,839
===========

Unused lines of credit $ 4,718,187
===========

(8) CREDIT RISK

The Company grants real estate, commercial and consumer loans to customers
primarily in the State of Florida with the majority of such loans in the
Orange and Seminole Counties area. Therefore, the Company's exposure to
credit risk is significantly affected by changes in the economy of the
Orange and Seminole Counties area.

(9) INCOME TAXES

The income tax benefit consisted of the following:

YEAR ENDED PERIOD ENDED
DECEMBER 31, DECEMBER 31,
------------ ------------
1999 1998
---- ----
Deferred:
Federal $(473,218) (22,441)
State (81,005) (3,841)
--------- -------

Total deferred $(554,223) (26,282)
========= =======

Thereasons for the differences between the statutory Federal income tax
rate and the effective tax rate are summarized as follows:

<TABLE>
<CAPTION>
YEAR ENDED PERIOD ENDED
DECEMBER 31, 1999 DECEMBER 31, 1998
----------------- -----------------
AMOUNT % AMOUNT %
------ - ------ -
<S> <C> <C> <C> <C>
Income tax benefit at statutory rate $(508,711) (34.0)% $ (23,904) (34.0)%
(Increase) decrease resulting from:
State income taxes, net of Federal tax benefit (53,463) (3.6) (2,535) (3.6)
Other 7,951 .5 157 .2
--------- ------ --------- ------

Income tax benefit $(554,223) (37.1)% $ (26,282) (37.4)%
========= ====== ========= ======

(continued)
</TABLE>

F-16
<PAGE> 95

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(9) INCOME TAXES, CONTINUED

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities are as
follows:

<TABLE>
<CAPTION>
AT DECEMBER 31,
---------------
1999 1998
---- ----
<S> <C> <C>
Deferred tax assets:
Net operating loss carryforwards $ 572,844 36,034
Allowance for loan losses 164,044 --
Unrealized loss on securities available for sale 108,892 --
Start up and organization costs 108,370 136,039
Deferred compensation 20,707 --
Depreciation -- 1,190
Other 13,510 --
--------- ---------

Gross deferred tax assets 988,367 173,263
--------- ---------

Deferred tax liabilities:
Accrual to cash conversion (174,106) (2,485)
Depreciation (3,115) --
---------
Allowance for loan losses -- (22,747)
--------- ---------

Gross deferred tax liabilities 177,221 (25,232)
--------- ---------

Net deferred tax asset $ 811,146 148,031
========= =========
</TABLE>

Realization of the deferred tax asset is dependent on generating sufficient
taxable income prior to the expiration of any net operating loss
carryforwards. Although realization is not assured, based on future
projections management believes it is more likely than not that the
recorded deferred tax asset will be realized and as such no valuation
allowance was established.

At December 31, 1999, the Company has the following net operating loss
carryforwards available to offset future Federal and state taxable
income:

EXPIRATION AMOUNT
---------- ------

2018 $ 94,515
2019 1,427,791
---------

$ 1,522,306
===========

(continued)

F-17
<PAGE> 96

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(10) RELATED PARTY TRANSACTIONS

In the ordinary course of business, the Company has made loans, at terms and
rates prevailing at the time, to Company officers, directors and their
affiliates. The aggregate dollar amount of these loans totaled $4.5
million and $.9 million at December 31, 1999 and 1998, respectively.
During the year ended December 31, 1999, total principal additions were
$4.0 million and total principal repayments were $.4 million. As of the
same dates, these individuals and entities had approximately $12.6
million and $3.2 million, respectively, of funds on deposit with the
Company.

In addition, in 1999 the Company began leasing one of its branch
facilities from a director of the Company. Total lease payments made to
this director totaled $115,724 for the year ended December 31, 1999.
During 1999, the Company also entered into agreements for various
insurance coverages which have resulted in normal commissions being paid
to a company affiliated with a director. The total insurance premiums
paid for these policies was approximately $202,800 for the year ended
December 31, 1999.

(11) STOCK OPTION PLANS

In 1999, the Company adopted an employee incentive stock option plan. Under
this plan, the total number of shares which may be issued is 106,000. The
option price shall not be less than the greater of the par value of the
common stock or the fair market value at the date of grant and the
options vest ratably over a five year period. Options granted during 1999
were effective the date employees were hired by the Company. During 1999,
93,000 options were granted under this plan.

Also in 1999, the Company adopted a directors' nonstatutory stock option
plan. Under this plan, the total number of shares which may be issued is
70,000. The option price shall not be less than the greater of the par
value of the common stock or the fair market value at the date of grant
and all options are immediately excisable when granted. During 1999,
70,000 options were granted under this plan.

A summary of stock option transactions follows:

<TABLE>
<CAPTION>
RANGE
OF PER WEIGHTED-
SHARE AVERAGE AGGREGATE
NUMBER OF OPTION PER SHARE OPTION
SHARES PRICE PRICE PRICE
------ ----- ----- -----
<S> <C> <C> <C> <C>
Options granted and outstanding at
December 31, 1999 163,000 $ 15.00 15.00 2,244,000
======= ======= ===== =========
</TABLE>

All options granted under both plans have ten year lives. The
weighted-average remaining contractual life of options outstanding at
December 31, 1999 was 9.1 years.

(continued)

F-18
<PAGE> 97

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(11) STOCK OPTION PLANS, CONTINUED

The options are exercisable as follows:

<TABLE>
<CAPTION>
NUMBER OF WEIGHTED-AVERAGE
YEAR ENDING DECEMBER 31, SHARES EXERCISE PRICE
------------------------ ------ --------------

<S> <C> <C>
Currently exercisable 75,600 $ 15.00
2000 18,600 15.00
2001 18,600 15.00
2002 18,600 15.00
2003 18,600 15.00
2004 13,000 15.00
-------- -------

163,000 $ 15.00
======== =======
</TABLE>

In order to calculate the fair value of the options, it was assumed that the
risk-free interest rate was 6.0%, there would be no dividends paid by the
Company over the exercise period, the expected life of the options would
be the entire exercise period and stock volatility would be zero due to
the lack of an active market for the stock. For purposes of pro forma
disclosures, the estimated fair value is included in expense during the
vesting period. The following information summarizes the options granted
under both plans (in thousands):

Weighted-average grant-date fair value of options
issued during the year $ 1,057
========

Proforma net loss $ (1,671)
========

Proforma net loss per share - basic and diluted $ (1.95)
========

(12) PROFIT SHARING PLAN

During 1999, the Company adopted a 401(k) profit sharing plan (the "Plan").
The Plan is available to all employees electing to participate after
meeting certain length-of-service requirements. The Company's
contributions to the Plan are discretionary and are determined
annually. The Company did not make any contributions to the Plan during
the year ended December 31, 1999. One of the investment choices
available under the Plan, allows for participants to purchase the
Company's common stock. 25,000 shares of the Company's common stock has
been allocated to the Plan. In 1999, $69,555 had been contributed to
the Plan by participants to purchase 4,637 shares of the Company's
common stock. These shares will be issued during the first quarter of
2000.

(13) EMPLOYEE STOCK PURCHASE PLAN

During 1999, the Company adopted an Employee Stock Purchase Plan (the
"Plan"). Under this Plan employees can elect to make payroll deductions
to purchase the Company's common stock. The total number of shares
which has been allocated under the Plan is 15,000 shares. During the
year ended December 31, 1999, employees had withheld $14,957, of which
$14,790 will be used to purchase 986 shares of the Company's common
stock. These shares will be issued during the first quarter of 2000.

(continued)

F-19
<PAGE> 98

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(14) REGULATORY MATTERS

Banking regulations place certain restrictions on dividends and loans or
advances made by the Bank to the Holding Company.

The Bank is subject to various regulatory capital requirements administered
by the regulatory banking agencies. Failure to meet minimum capital
requirements can initiate certain mandatory and possibly additional
discretionary actions by regulators that, if undertaken, could have a
direct material effect on the Company's financial statements. Under
capital adequacy guidelines and the regulatory framework for prompt
corrective action, the Bank must meet specific capital guidelines that
involve quantitative measures of their assets, liabilities, and certain
off-balance-sheet items as calculated under regulatory accounting
practices. The capital amounts and classification are also subject to
qualitative judgements by the regulators about components, risk
weightings, and other factors.

Quantitative measures established by regulation to ensure capital adequacy
require the Bank to maintain minimum amounts and percentages (set forth
in the following table) of total and Tier 1 capital (as defined in the
regulations) to risk-weighted assets (as defined) and of Tier 1 capital
(as defined) to average assets (as defined). Management believes, as of
December 31, 1999 and 1998, the Bank met all capital adequacy
requirements to which they are subject.

As of December 31, 1999, the most recent notification from the regulatory
authorities categorized the Bank as well capitalized under the
regulatory framework for prompt corrective action. To be categorized as
well capitalized, an institution must maintain minimum total
risk-based, Tier I risk-based, and Tier I leverage percentages as set
forth in the following tables. There are no conditions or events since
that notification that management believes have changed the Bank's
category. The Bank's actual capital amounts and percentages as of
December 31, 1999 and 1998 are also presented in the table (dollars in
thousands).

<TABLE>
<CAPTION>
MINIMUM
TO BE WELL
CAPITALIZED UNDER
FOR CAPITAL ADEQUACY PROMPT CORRECTIVE
ACTUAL PURPOSES: ACTION PROVISIONS:
---------------------- -------------------- -------------------
AMOUNT % AMOUNT % AMOUNT %
------ - ------ - ------ -
<S> <C> <C> <C> <C> <C> <C>
AS OF DECEMBER 31, 1999:
Total capital to Risk-
Weighted assets.......... $ 12,172 17.5% $ 5,551 8.0% $ 6,939 10.0%
Tier I Capital to Risk-
Weighted Assets.......... 11,551 16.6 2,776 4.0 4,163 6.0
Tier I Capital
to Total Assets.......... 11,551 15.5 2,972 4.0 3,715 5.0

AS OF DECEMBER 31, 1998:
Total capital to Risk-
Weighted assets.......... 12,097 207.3 467 8.0 584 10.0
Tier I Capital to Risk-
Weighted Assets.......... 12,085 207.1 233 4.0 350 6.0
Tier I Capital
to Total Assets.......... 12,085 94.2 513 4.0 641 5.0
</TABLE>

(continued)

F-20
<PAGE> 99

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(15) HOLDING COMPANY FINANCIAL INFORMATION

As discussed in Note 1 to the Consolidated Financial Statements, the
Holding Company was organized during 1999. The Holding Company?s
financial information as of December 31, 1999 and for the year then
ended follows:

CONDENSED BALANCE SHEET
AT DECEMBER 31,
---------------
1999
----
ASSETS

Investment in subsidiary $11,838,487
-----------

Total assets $11,838,487
===========

STOCKHOLDERS' EQUITY

Stockholders' equity 11,838,487

Total stockholders' equity $11,838,487
===========

CONDENSED STATEMENT OF OPERATIONS

FOR THE
YEAR ENDED
DECEMBER 31,
------------
1999
----

Loss of subsidiary $(941,985)
---------

Net loss $(941,985)
=========

(continued)

F-21
<PAGE> 100

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

(15) HOLDING COMPANY FINANCIAL INFORMATION, CONTINUED

CONDENSED STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
FOR THE
YEAR ENDED
DECEMBER 31,
------------
1999
----
<S> <C>
Cash flows from operating activities:
Net loss $(941,985)
Adjustments to reconcile net loss to net cash used in
operating activities -
Equity in undistributed loss of subsidiary (941,985)

Net cash used in operating activities --
---------

Net increase in cash and cash equivalents --

Cash and cash equivalents at beginning of the year --
---------

Cash and cash equivalents at end of year $ --
=========

Noncash transactions:
Change in investment in subsidiary due to change in accumulated
other comprehensive income, unrealized loss on securities
available for sale, net of income tax $(202,227)
=========
</TABLE>

(16) YEAR 2000 ISSUES

The Company's operating and financial systems have been found to be
compliant; the "Y2K Problem" has not adversely affected the Company's
operations nor does management expect that it will. However, the
Company has not determined what effect it has had on its customers and
vendors. Any adverse effect it might have on the Company because of
vendors and customers noncompliance has not been determined.

(17) NEW BANK CHARTER

In September, 1999 the Company's Board of Directors approved the formation
of a new bank in Southwest, Florida. The new bank is subject to
regulatory approval.

F-22
<PAGE> 101

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

Condensed Consolidated Balance Sheets (Unaudited)

<TABLE>
<CAPTION>
At March 31,
------------------------
2000 1999
<S> <C> <C>
Assets

Cash and due from banks $ 4,096,359 1,251,488
Federal funds sold 19,673,000 8,724,000
------------- -------------

Cash and cash equivalents 23,769,359 9,975,488

Securities available for sale 15,572,569 3,173,031
Loans receivable, net of allowance for loan losses of $799,000 in
2000 and $91,000 in 1999 78,950,892 10,326,918
Accrued interest receivable 566,877 79,070
Federal Home Loan Bank stock, at cost 212,400 --
Premises and equipment, net 6,243,770 3,018,424
Deferred income tax asset 831,691 298,245
Other assets 119,078 134,448
------------- -------------

Total assets $ 126,266,636 27,005,624
============= =============

Liabilities and Stockholders' Equity

Liabilities:
Noninterest-bearing demand deposits 14,039,046 2,475,810
Money-market deposits 18,625,829 7,061,952
Savings and NOW deposits 7,898,241 851,548
Time deposits 70,477,742 3,213,535
------------- -------------

Total deposits 111,040,858 13,602,845

Official checks 2,802,549 939,556
Accrued interest payable and other liabilities 537,319 144,263
------------- -------------

Total liabilities 114,380,726 14,686,664
------------- -------------

Stockholders' equity:
Commonstock, $1 par value, 10,000,000 shares authorized, 890,298 and
858,405 shares issued and outstanding,
in 2000 and 1999 890,298 858,405
Additional paid-in capital 12,464,172 12,017,670
Accumulated deficit (1,215,103) (547,061)
Accumulated other comprehensive income (loss) (253,457) (10,054)
------------- -------------

Total stockholders' equity 11,885,910 12,318,960
------------- -------------

Total liabilities and stockholders' equity $ 126,266,636 27,005,624
============= =============
</TABLE>

F-23
<PAGE> 102

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

Condensed Consolidated Statements of Operations (Unaudited)

<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------------------
2000 1999
---- ----
<S> <C> <C>
Interest income:
Loans receivable $1,630,449 224,923
Securities available for sale 221,503 16,650
Other interest-earning assets 105,670 118,716
---------- ----------

Total interest income 1,957,622 360,289
---------- ----------

Interest expense:
Deposits 924,624 67,090
Other borrowings 42,859 --
---------- ----------

Total interest expense 967,483 67,090
---------- ----------

Net interest income 990,139 293,199

Provision for loan losses 178,000 79,000
---------- ----------

Net interest income after provision for loan losses 812,139 214,199
---------- ----------

Noninterest income:
Service charges on deposit accounts 52,640 669
Other service charges and fees 39,891 1,072
---------- ----------

Total noninterest income 92,531 1,741
---------- ----------

Noninterest expense:
Salaries and employee benefits 424,454 318,900
Occupancy expense 219,354 111,226
Data processing 56,330 17,549
Printing and office supplies 27,481 35,935
Marketing and advertising 43,062 43,045
Professional fees 24,258 17,549
Telephone 19,236 13,565
Travel and entertainment 15,821 10,440
Other 57,076 55,918
---------- ----------

Total noninterest expense 887,072 624,127
---------- ----------

Earnings (loss) before income tax provision (benefit) 17,598 (408,187)

Income tax provision (benefit) 7,040 (144,801)
---------- ----------

Net earnings (loss) $ 10,558 (263,386)
========== ==========

Basic and diluted earnings (loss) per share $ .01 (.31)
========== ==========

Weighted-average number of common shares outstanding 887,362 846,415
========== ==========

</TABLE>

F-24
<PAGE> 103

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

Condensed Consolidated Statements of Cash Flows (Unaudited)

<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------------------
2000 1999
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net earnings (loss) $ 10,558 (263,385)
Adjustments to reconcile net earnings (loss) to net cash
provided by (used in) operating activities:
Provision for loan losses 178,000 79,000
Depreciation and amortization 75,987 18,098
Deferred income taxes 7,040 (144,801)
Accretion of discounts on securities (6,831) (280)
Common stock issued as compensation 3,750 --
Increase in accrued interest receivable (12,841) (48,009)
Increase in other assets (30,382) (17,700)
Increase (decrease) in official checks 2,140,312 (95,829)
Increase in accrued interest payable and other liabilities 236,866 79,514
------------ ------------
Net cash provided by (used in) operating activities 2,602,459 (393,392)
------------ ------------

Cash flows from investing activities:
Repayments of securities available for sale 16,285 --
Purchases of securities available for sale (3,662,938) (3,188,218)
Net increase in loans (17,766,319) (9,203,313)
Purchases of premises and equipment (2,001,989) (1,186,450)
------------ ------------

Net cash used in investing activities (23,414,961) (13,577,981)
------------ ------------

Cash flows from financing activities:
Net increase in deposits 45,977,867 10,329,241
Net decrease in Federal funds purchased (6,000,000) --
Proceeds from issuance of common stock 84,345 359,700
------------ ------------

Net cash provided by financing activities 40,062,212 10,688,941
------------ ------------

Net increase (decrease) in cash and cash equivalents 19,249,710 (3,282,432)

Cash and cash equivalents at beginning of period 4,519,649 13,257,920
------------ ------------

Cash and cash equivalents at end of period $ 23,769,359 9,975,488
============ ============

Supplemental disclosures of cash flow information:
Cash paid during the period for:

Interest $ 859,425 58,180
============ ============

Income taxes $ -- --
============ ============

Noncash investing activities-
Change in accumulated other comprehensive income (loss),
unrealized loss on securities available for sale, net of tax $ (51,230) (10,054)
============ ============

</TABLE>

F-25
<PAGE> 104

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

Condensed Consolidated Statement of Changes in Stockholders' Equity

Three Months Ended March 31, 2000 (Unaudited)

<TABLE>
<CAPTION>
Accumulated
Other
Compre-
Additional hensive Total
Common Paid-in Accumulated Income Stockholders'
Stock Capital Deficit (Loss) Equity
----- ------- ------- ------ ------
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1999 $ 884,425 12,381,950 (1,225,661) (202,227) 11,838,487

Comprehensive income (loss):
Net earnings for the period -- -- 10,558 -- 10,558

Net change in unrealized loss
on securities available for
sale, net of tax -- -- -- (51,230) (51,230)
----------

Comprehensive income (loss) (40,672)

Stock issued to officer as compensation
(250 shares) 250 3,500 -- -- 3,750

Sale of common stock in connection
with 401(k) Profit Sharing Plan
(4,637 shares) 4,637 64,918 -- -- 69,555

Sale of common stock in connection
with Employee Stock Purchase
Plan (986 shares) 986 13,804 -- -- 14,790
--------- ---------- ---------- -------- ----------

Balance at March 31, 2000 $ 890,298 12,464,172 (1,215,103) (253,457) 11,885,910
========= ========== ========== ======== ==========

</TABLE>

F-26
<PAGE> 105

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (unaudited)

1. General. In the opinion of the management of Southern Community Bancorp,
the accompanying condensed consolidated financial statements contain all
adjustments (consisting principally of normal recurring accruals)
necessary to present fairly the financial position at March 31, 2000 and
1999 and the results of operations and cash flows for the three-month
periods then ended. The results of operations and other data for the
three months ended March 31, 2000 are not necessarily indicative of the
results to be expected for the year ending December 31, 2000.

Southern Community Bancorp (the "Holding Company") owns 100% of the
outstanding common stock of Southern Community Bank (the "Bank")
(collectively the "Company"). The Holding Company operates as a one-bank
holding company. On April 15, 1999, the Bank's stockholders approved a
plan of corporate reorganization under which the Bank would become a
wholly-owned subsidiary of the Holding Company. The Holding Company was
formed on July 30, 1999. The Bank's stockholders exchanged their common
shares for shares of the Holding Company. As a result, all of the
previously issued $7.50 par value common shares of the Bank were
exchanged for 834,425 shares of the $1.00 par value common shares of the
Holding Company. The Holding Company's acquisition of the Bank was
accounted for similar to a pooling of interests.

The Holding Company's only business activity is the operation of the
Bank. The Bank is a state (Florida) chartered commercial bank. The Bank
offers a variety of financial services to individual and corporate
customers through its four banking offices located in Orange and
Seminole Counties, Florida. The deposits of the Bank are insured by the
Federal Deposit Insurance Corporation ("FDIC") through the Bank
Insurance Fund ("BIF").

2. Loan Impairment and Loan Losses. There were no impaired loans recognized
under SFAS 114 and 118 during the three months ended March 31, 2000 or
1999. The activity in the allowance for loan losses is as follows:

Three Months Ended
March 31,
-----------------------
2000 1999
---- ----

Balance at beginning of period $ 621,000 12,000
Provision charged to earnings 178,000 79,000
--------- ------

Balance at end of period $ 799,000 91,000
========= ======

(continued)

F-27
<PAGE> 106

SOUTHERN COMMUNITY BANCORP AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (unaudited), Continued

3. Earnings (Loss) Per Share. Earnings (loss) per share of common stock
has been computed on the basis of the weighted-average number of shares
of common stock outstanding. For the three months ended March 31, 2000
and 1999 outstanding stock options are not considered dilutive
securities for purposes of calculating diluted earnings (loss) per
share.

4. Regulatory Capital. The Bank is required to maintain certain minimum
regulatory capital requirements. The following is a summary at March 31,
2000 of the regulatory capital requirements and the Bank's actual
capital on a percentage basis:

Regulatory
Actual Requirement
------ -----------

Total capital to risk-weighted assets 13.23% 8.00%
Tier I capital to risk-weighted assets 12.40% 4.00%
Tier I capital to total assets - leverage ratio 11.87% 4.00%

5. Other Events. The Company purchased two parcels of land for future
branch sites in the Bonita Springs, Florida area for approximately $1.9
million during the three months ended March 31, 2000.

F-28
<PAGE> 107
EXHIBIT A

SUBSCRIPTION AGREEMENT

Southern Community Bancorp
250 North Orange Avenue
Orlando, Florida 32801

Attn: Mr. Charlie W. Brinkley, Jr.
Mr. John G. Squires

Gentlemen:

1. SUBSCRIPTION. Subject to the terms and conditions set forth below,
the undersigned hereby subscribes to purchase shares (the "Shares") of the
common stock, par value $1.00 per share (the "Common Stock") of Southern
Community Bancorp, a corporation organized under the laws of Florida (the
"Company"). The undersigned hereby acknowledges receipt of a copy of the
Company's Prospectus, dated as of June ___, 2000 (the "Prospectus"), with
respect to the offering of the Common Stock.

2. PURCHASE OF SHARES. The undersigned hereby subscribes for the number
of Shares specified below:

Number of Shares to be ____________ Shares
purchased:
(minimum of 1,000 Shares)

Price per Share: x $16.50

Total purchase price: $__________________

Amount of enclosed check:
($16.50 per Share times
number of Shares purchased) $__________________

3. PAYMENT OF PURCHASE PRICE. The undersigned has enclosed with this
Agreement the undersigned's personal check (or a certified check, bank check or
money order) payable to "SunTrust Bank -- Escrow Agent for Southern Community
Bancorp" in payment for the number of Shares listed in Section 2.

4. TITLE TO SHARES. The undersigned hereby requests that the Shares be
issued as follows:

TITLE TO BE TAKEN - (check one)

( ) Individual ownership

( ) Joint tenants with right
of survivorship

( ) Other-specify: ________________

______________________________________________________

Social Security No. or
Taxpayer Identification No.:

______________________________________________________

______________________________________________________
(Name as it should appear on the Company's stock register
- two names for joint owners - please print or type)

______________________________________________________

______________________________________________________
(Residence Address)

______________________________________________________
(Home Phone)

______________________________________________________
(Business Phone)

<PAGE> 108

5. DESIGNATION OF ESCROW ACCOUNT. The undersigned hereby directs the
Company to deposit the undersigned's funds (if accepted by the Company for
subscription) as follows:

( ) Deposit $ __________ of the subscription funds in the first
escrow account (as described in the Prospectus).

( ) Deposit $ __________ of the subscription funds in the second
escrow account (as described in the Prospectus).

6. ESCROW AGREEMENT. The undersigned acknowledges and agrees that the
undersigned's funds will be held in escrow in accordance with the terms of the
Escrow Agreement dated ____, 2000 by and between the Company and SunTrust Bank,
as escrow agent.

7. CERTAIN ACKNOWLEDGMENTS. The undersigned is fully aware that:

(a) The subscription offer set forth in this Agreement may be
accepted or rejected in whole or in part by the Company in its sole and absolute
discretion.

(b) The subscription offer set forth in this Agreement is and shall
be irrevocable, except as set forth in the Prospectus, PROVIDED that the
undersigned shall have no obligations under this Agreement in the event that the
subscription offer set forth in this Agreement is rejected or the offering
described in the Prospectus is canceled or withdrawn.

(c) No federal or state agency has made any finding or determination
as to the fairness of the offering for public investment, and no such agency has
made any recommendation or endorsement of the Shares.

(d) There is no public market for the Shares.

(e) THE SHARES ARE NOT DEPOSITS AND ARE NOT INSURED BY THE FDIC OR
ANY OTHER AGENCY.

8. MISCELLANEOUS

(a) MODIFICATION. Neither this Agreement nor any provisions of this
Agreement shall be modified, discharged or terminated except by an instrument in
writing signed by the party against whom any waiver, change, discharge or
termination is sought.

(b) BINDING EFFECT. This Agreement shall be binding upon and inure
to the benefit of the parties and their heirs, executors, administrators,
successors, legal representatives and permitted assigns. If the undersigned is
more than one person, the obligation of the undersigned shall be joint and
several and the agreements, representations, warranties and acknowledgments
herein contained shall be deemed to be made by and be binding upon each such
person and his heirs, executors, administrators and successors.

(c) ASSIGNABILITY. This Agreement is not transferable or assignable
by the undersigned. Any purported transfer or assignment by the undersigned
shall be null and void.

(d) APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the laws of Florida.

-2-
<PAGE> 109

IN WITNESS WHEREOF, the undersigned has executed this
Subscription Agreement on this ____ day of ___________________, 2000.

-------------------------------------
Signature

-------------------------------------
Signature (Second signature required
for joint ownership)

ACCEPTANCE OF SUBSCRIPTION:

Southern Community Bancorp hereby accepts the subscription offer set
forth in this Agreement for ________ Shares, with $________ of proceeds to be
deposited in the first escrow account and $________ of proceeds to be deposited
in the second escrow account.

SOUTHERN COMMUNITY BANCORP

By:
-------------------------------------

Its:
-------------------------------------

-3-
<PAGE> 110
EXHIBIT B

ESCROW AGREEMENT

This ESCROW AGREEMENT effective as of the day of ______, 2000, by and among:

SOUTHERN COMMUNITY BANCORP, a Florida corporation, the
principal place of business of which is located at 250 North
Orange Avenue, Orlando, Florida 32801 (hereinafter referred to
as the "Company")

and

SUNTRUST BANK, located at 255 South Orange Avenue, Orlando,
Florida 32801 (hereinafter referred to as the "Escrow Agent")

WITNESSETH:

WHEREAS, the Company intends to undertake an offering of a minimum of
200,000 shares and a maximum of 1,050,000 shares of its common stock, par value
$1.00 per share (the "Common Stock") at a subscription price of $16.50 per share
(the "Offering"); and

WHEREAS, the Company has agreed to establish two (2) escrow accounts,
with the amounts deposited in the first escrow (the "First Escrow") to be
utilized to capitalize the Company's proposed new bank subsidiary, Southern
Community Bank of Southwest Florida (the "New Bank"), and with the amounts
deposited into the second escrow account (the "Second Escrow") to be primarily
utilized for providing additional working capital to the Company's existing bank
subsidiary, Southern Community Bank (the "Existing Bank"); and

WHEREAS, persons who subscribe to purchase shares in the Offering (the
"Subscribers") must designate how much of their proceeds will be deposited in
the First Escrow or the Second Escrow; and

WHEREAS, the Company desires to appoint the Escrow Agent to act as
escrow agent with respect to the Offering; and

WHEREAS, the Escrow Agent has agreed to act as escrow agent for
purposes of the Offering on the terms, and subject to the conditions, set forth
in this Agreement.

NOW, THEREFORE, in consideration of the mutual premises herein
contained, the parties hereto agree as follows:

<PAGE> 111

1. APPOINTMENT OF ESCROW AGENT. The Escrow Agent has agreed to
act as the escrow agent for the Offering, pursuant to the terms and conditions
of this Agreement.

2. DEPOSIT AND DELIVERY OF PROCEEDS. For purposes of this
Agreement, the term "Proceeds" shall mean all subscription proceeds which may be
delivered to the Escrow Agent, whether in the form of checks, cashier checks
and/or money orders. The Company shall promptly deliver to the Escrow Agent all
Proceeds received by the Company from Subscribers. The Escrow Agent shall
deposit the Proceeds in either the First Escrow or the Second Escrow, or both,
as designated by each Subscriber. The Escrow Agent shall have no responsibility
whatsoever for Proceeds not delivered to the Escrow Agent or for funds that have
not yet cleared and become good funds. The parties acknowledge that Subscribers
have been instructed to make all checks for the Common Stock payable to the
Escrow Agent. In the event that a Subscriber makes a check payable to the
Company, the Company shall endorse such checks to the order to the Escrow Agent.
Simultaneously with the delivery of the Proceeds received from each Subscriber,
the Company shall deliver to the Escrow Agent a copy of the Subscription
Agreement executed by each Subscriber and the Company's written acceptance of
the subscription offer contained in the Subscription Agreement.

3. PARTIAL REJECTION OF SUBSCRIPTIONS. If the Company elects to
accept a subscription offer for less than the number of shares requested by a
Subscriber in his Subscription Agreement, then the Company shall notify the
Escrow Agent in writing of the number of shares which the Company has elected to
accept. Promptly after the receipt of such notice, the Escrow Agent shall
deposit the accepted portion of the Subscriber's Proceeds in the appropriate
escrow account or accounts and remit to the Subscriber that portion of his
Proceeds which were not accepted, without interest or deduction.

4. TERMS OF FIRST ESCROW. The Escrow Agent shall hold and
disburse all Proceeds deposited in the First Escrow on the following terms and
conditions:

(a) Unless the Escrow Agent has previously disbursed the
Proceeds under Section 4(b), the Escrow Agent will promptly return all Proceeds
deposited in the First Escrow to Subscribers to the First Escrow, without
interest or deduction, upon the first to occur of the following:

(i) Upon written notice from the Company that
the Offering has been terminated; or

(ii) Upon the Expiration Date (as defined below)
of the Offering.

(b) The Escrow Agent will promptly deliver the Proceeds
deposited in the First Escrow to the Company upon the Company's written request,
provided that both of the following conditions have been fulfilled:

(i) The Escrow Agent has received written notice
from the Company that the Company has
received all required regulatory approvals
to open the New Bank; and

2
<PAGE> 112

(ii) The Escrow Agent has received Proceeds of at
least $10,065,000 designated for deposit to
the First Escrow (including, any amounts
transferred from the Second Escrow to the
First Escrow under Section 5(c)).

(c) The parties acknowledge that the Company may continue
to deposit additional Proceeds in the First Escrow even after the disbursement
of Proceeds pursuant to Section 4(b). The Escrow Agent will promptly deliver
such Proceeds to the Company, provided that the Escrow Agent shall not accept
any Proceeds after the Expiration Date.

5. TERMS OF SECOND ESCROW. The Escrow Agent shall hold all
Proceeds deposited in the Second Escrow on the following terms and conditions:

(a) Unless the Escrow Agent has previously disbursed the
Proceeds under Section 5(b), the Escrow Agent will promptly return all Proceeds
deposited in the Second Escrow to Subscribers to the Second Escrow, without
interest or deduction, promptly upon the first to occur of the following:

(i) Upon written notice from the Company that
the Offering has been terminated; or

(ii) Upon the Expiration Date of the Offering.

(b) The Escrow Agent will promptly deliver all Proceeds
deposited in the Second Escrow to the Company upon the written request by the
Company, provided that the Escrow Agent has received at least $3,300,000
designated for deposit in the the Second Escrow.

(c) The parties acknowledge that if the Company sells
more than 200,000 shares with Proceeds designated for the Second Escrow, then
the Company shall have a right to instruct the Escrow Agent either:

(i) To transfer the excess amounts from the
Second Escrow to the First Escrow; or

(ii) To release such Proceeds to the Company.

In the event that any Proceeds are transferred to the First Escrow, the
Escrow Agent will hold such additional Proceeds on the same terms as any other
Proceeds deposited in the First Escrow.

6. EXPIRATION DATE. The Expiration Date of the Offering shall be
September 30, 2000, provided that the Company has the right to extend the
Expiration Date to December 31, 2000. The Escrow Agent shall be entitled to
assume that the Expiration Date is September 30, 2000, unless, prior to such
date, the Company has provided written notice to the Escrow Agent that the
Expiration Date has been extended to December 31, 2000.

3
<PAGE> 113

7. RETURN OF PROCEEDS TO SUBSCRIBERS. In the event that the
Escrow Agent is obligated to return Proceeds to any Subscriber pursuant to the
terms of this Agreement, the Escrow Agent shall return such Proceeds to the
Subscriber in the form of a check, mailed by regular mail, to the address the
Subscriber set forth in such Subscription Agreement.

8. INVESTMENT OF PROCEEDS BY ESCROW AGENT. The Escrow Agent shall
invest the Proceeds deposited in each escrow account in the STI Classic
Institutional U.S. Treasury Securities Money Market Fund (a AAA rated mutual
fund comprised solely of investments in United States government, United States
government backed securities and repurchase agreements collateralized by United
States government backed securities). All income from the Fund shall accrue to
the benefit of the Company. Upon the consummation, termination or expiration of
the Offering, the Escrow Agent will deliver all income and other amounts earned
on the investment of the Proceeds to the Company. The Escrow Agent shall furnish
to the Company periodic and final reports regarding the investments of the
Proceeds. The Escrow Agent shall have no liability or obligation whatsoever for
the status of the investments or the failure of said investments, and shall have
no responsibility for tax reporting in connection with earnings or gains/losses
on the investments.

9. DUTIES OF ESCROW AGENT. The Escrow Agent undertakes to perform
only such duties as are expressly set forth in this Agreement and no implied
duties or obligations shall be read into this Agreement against the Escrow
Agent.

10. RELIANCE OF ESCROW AGENT ON DOCUMENTS. The Escrow Agent may
act in reliance upon any writing or instrument or signature which the Escrow
Agent, in good faith, believes to be genuine, may assume the validity and
accuracy of any statement or assertion contained in such a writing or
instrument, and may assume that any person purporting to give any writing,
notice, advice or instructions in connection with the provisions hereof has been
duly authorized to do so.

11. INDEMNIFICATION OF ESCROW AGENT. Unless the Escrow Agent
discharges any of its duties hereunder in a manner constituting gross negligence
or willful misconduct, the Company hereby agrees to indemnify the Escrow Agent
and hold it harmless from any and all claims, liabilities, losses, actions,
suits or proceedings at law or in equity, or any other expenses, fees or charges
of any character or nature which it may incur or with which it may be threatened
by reason of its acting as escrow agent under this Agreement; and in connection
therewith, to indemnify the Escrow Agent against any and all expenses, including
reasonable attorneys' fees and the cost of defending any action, suit or
proceeding or resisting any claim.

12. DISCRETION OF ESCROW AGENT TO FILE AN INTERPLEADER ACTION IN
THE EVENT OF DISPUTE. If the parties shall be in disagreement about the
interpretation of this Agreement, or about the rights and obligations, or the
propriety of any action contemplated by the Escrow Agent hereunder, the Escrow
Agent may, but shall not be required to, file an action of interpleader to
resolve the disagreement and may hold all Proceeds until directed by a court of
competent jurisdiction as to the manner or distribution or until all parties in
dispute mutually agree to the distribution. The Escrow Agent shall be
indemnified as set forth in Section 11 for all costs, including reasonable

4
<PAGE> 114

attorneys' fees incurred by it, in connection with the aforesaid interpleader
action, and shall be fully protected in suspending all or part of its activities
under this Agreement until a final judgment or other appropriate order in the
interpleader action is entered.

13. CONSULTATION WITH COUNSEL. The Escrow Agent may consult with
independent counsel of its own choice and shall not be liable for any actions
which it takes in reliance upon the advise of such counsel.

14. LIMITATION OF LIABILITY. The Escrow Agent shall not be liable for
any mistakes of fact or errors of judgment, or for any acts or omissions of any
kind unless they constitute gross negligence or willful misconduct on the part
of the Escrow Agent.

15. RESIGNATION OF ESCROW AGENT. The Escrow Agent may resign upon
thirty (30) days written notice to the Company. If a successor escrow agent is
not appointed by the Company within this thirty (30) day period, the Escrow
Agent may petition a court of competent jurisdiction to name a successor or, at
its option, the Escrow Agent may do nothing until such time as the Company has
furnished the name of a successor escrow agent.

16. COMPENSATION AND EXPENSES. The Escrow Agent shall be entitled to
compensation from the Company for its services hereunder in an amount of $_____.
In the event Escrow Agent must return the Proceeds to a Subscriber, the Company
will pay the Escrow Agent an additional $15.00 for each refund. The parties
acknowledge that the Escrow Agent will earn a management fee on the investment
of the Proceeds pursuant to Section 8 of this Agreement.

17. NOTICES. All notices permitted or required to be given to any party
under this Agreement shall be in writing and shall be deemed to have been given
upon receipt by the party being notified. In the case of the Company, such
notices shall be sent to: Mr. Charlie W. Brinkley, Jr., Chairman and CEO,
Southern Community Bancorp, 250 North Orange Avenue, Orlando, Florida 32801.
Either party may change the address to which said notice is to be given by
giving notice of such to all other parties to this Agreement in the manner set
forth herein.

18. SUCCESSORS AND ASSIGNS. The rights created by the Agreement shall
inure to the benefit of, and the obligations created hereby shall be binding
upon, the successors and assigns of the Escrow Agent and the Company, as the
case may be.

19. GOVERNING LAW. This Agreement shall be construed in accordance
with, and governed by the laws of, the State of Florida.

20. TERMINATION. This Escrow Agreement shall terminate and the Escrow
Agent shall be discharged of all responsibility hereunder at such time as the
Escrow Agent shall have disbursed all of the Proceeds in accordance with the
terms of this Agreement.

21. COMPLETE AGREEMENT. This Agreement constitutes the complete
agreement between the parties hereto and incorporates all prior discussions,
agreements and representations made in regard to the matters set forth herein.

5
<PAGE> 115

This Agreement may not be amended, modified or changed except by a writing
signed by the party to be charged by said amendment, change or modification.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.

SOUTHERN COMMUNITY BANCORP

By: /s/ CHARLIE W. BRINKLEY, JR.
------------------------------------
Charlie W. Brinkley, Jr.
Chairman and CEO

SUNTRUST BANK

By: /s/ SunTrust Bank
------------------------------------
First Vice President

6
<PAGE> 116

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

The Registrant's Bylaws limit, to the maximum extent permitted by
Florida law, the personal liability of directors and officers for monetary
damages for breach of their fiduciary duties as directors or officers. The
Bylaws provide further that the Registrant shall indemnify to the fullest extent
permitted by Florida law any person made a party to an action or proceeding by
reason of the fact that such person was director, officer, employee or agent of
the Registrant. The Bylaws also provide that directors and officers who are
entitled to indemnification shall be paid their expenses incurred in connection
with any action, suit, or proceeding in which such director or officer is made a
party by virtue of his or her being an officer or director of the Registrant to
the maximum extent permitted by Florida law.

Reference is made to the following documents filed as Exhibits to this
Registration Statement regarding relevant indemnification provisions described
above and elsewhere herein:

Document Exhibit Number
-------- --------------

Registrant's Articles of Incorporation...................... 3.1
Registrant's Bylaws......................................... 3.2

ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth the costs and expenses payable in
connection with the sale of the common stock being registered hereby. All
amounts are estimates, except the registration fee.

Item Amount
---- -------

SEC REGISTRATION FEE........................................ $4,573

BLUE SKY FEES AND EXPENSES.................................. $1,000

PRINTING AND ENGRAVING EXPENSES............................. $10,000

LEGAL FEES AND EXPENSES..................................... $60,000

AUDITORS' FEES AND EXPENSES................................. $25,000

TRANSFER AGENT AND REGISTRAR FEES........................... 0

MISCELLANEOUS EXPENSES...................................... 0

ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES.

THE FOLLOWING IS A SUMMARY OF THE TRANSACTIONS BY REGISTRANT SINCE THE
REGISTRANT'S INCORPORATION ON MARCH 24, 1999, INVOLVING SALES OF REGISTRANT'S
SECURITIES THAT WERE NOT REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT").

ON JULY 30, 1999, THE REGISTRANT ISSUED 884,425 SHARES OF COMMON STOCK
IN EXCHANGE FOR ALL OF THE OUTSTANDING CAPITAL STOCK OF SOUTHERN COMMUNITY BANK.
THIS TRANSACTION WAS EXEMPT FROM SECTION 5 OF THE SECURITIES ACT PURSUANT TO THE
PROVISIONS OF SECTION 3(A)(12).

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<PAGE> 117
THE REGISTRANT HAS ENTERED INTO A RESTRICTED STOCK AGREEMENT WITH
CHARLIE W. BRINKLEY, JR., ITS CHAIRMAN, UNDER WHICH THE REGISTRANT HAS AGREED TO
ISSUE UP TO 50,000 SHARES OF ITS COMMON STOCK TO MR. BRINKLEY AS COMPENSATION
FOR SERVICES. UNDER THE TERMS OF THIS AGREEMENT, THE REGISTRANT ISSUED 250
SHARES EFFECTIVE AS OF JANUARY 1, 2000. THIS TRANSACTION WAS EXEMPT FROM SECTION
5 OF THE SECURITIES ACT OF 1933 PURSUANT TO SECTION 4(2).

ON JANUARY 1, 2000, THE REGISTRANT ISSUED 986 SHARES OF ITS COMMON
STOCK TO CERTAIN EMPLOYEES PURSUANT TO THE REGISTRANT'S EMPLOYEE STOCK PURCHASE
PROGRAM. THESE SHARES WERE ISSUED AT A PRICE OF $15.00 PER SHARE. THESE
TRANSACTIONS WERE EXEMPT FROM SECTION 5 OF THE SECURITIES ACT OF 1933 PURSUANT
TO SECTION 4(2) OF THE SECURITIES ACT.

ON JANUARY 1, 2000, THE REGISTRANT SOLD 4,637 SHARES OF ITS COMMON
STOCK TO CERTAIN EMPLOYEES AT A PRICE OF $15.00 PER SHARE. THESE TRANSACTIONS
WERE EXEMPT FROM SECTION 5 OF THE SECURITIES ACT OF 1933 PURSUANT TO SECTION
4(2) OF THE SECURITIES ACT.

ITEM 27. EXHIBITS.

(A) EXHIBITS

Exhibit
Number Exhibit
------- -------
3.1 Articles of Incorporation, as amended, of Registrant*
3.2 Bylaws of Registrant*
4.1 Specimen Common Stock Certificate of Registrant*
5.1 Opinion of Shutts & Bowen LLP
10.1 Employees' Incentive Stock Option Plan of Registrant*
10.2 Directors' Statutory Stock Option Plan of Registrant*
10.3 Amended and Restated Employee Stock Purchase Plan of
Registrant*
10.4 Salary Continuation Agreement between the Registrant and
Charlie W. Brinkley, Jr.dated February 23, 1999*
10.5 Salary Continuation Agreement between the Registrant and John
G. Squires dated February 23, 1999*
10.6 Lease Agreement dated April 22, 1998 between Marx Realty and
Improvement Co., Inc. and Registrant*
10.7 Lease Agreement dated November 30, 1998 between Patrick J.
Armstrong and Registrant*
10.8 Electronic Data Processing Agreement dated August 12, 1998
between the Registrant and First Commerce Technologies, Inc.*
10.9 Restricted Stock Agreement made effective as of January 1,
1999 between the Registrant and Charlie W. Brinkley, Jr.*
10.10 Escrow Agreement between the Registrant and SunTrust Bank
21.1 List of Subsidiaries of Registrant*
23.1 Consent of Hacker, Johnson, Cohen & Grieb PA
23.2 Consent of Shutts & Bowen LLP (included in Exhibit 5.1)
24.1 Powers of Attorney (included on signature page of Registration
Statement)*
27.1 Financial Data Schedule of Registrant for the three months
ended March 31, 2000
99.1 Consent of Richard Garner, Proposed Director
99.2 Consent of Joel Whittenhall, Proposed Director

--------

*Previously filed

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<PAGE> 118
(b) Financial Statement Schedules: None

ITEM 28. UNDERTAKINGS.

The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement: (i) To include any
prospectus required by Section 10(a)(3) of the Securities Act; (ii) To reflect
in the prospectus any facts or events which, individually or together, represent
a fundamental change in the registration statement; (iii) To include any
additional or changed material information on the plan of distribution.

(2) For determining liability under the Securities Act, to treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the initial bona
fide offering.

(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
this offering.

(4) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officer or controlling persons of
the registrant, pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that, in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Securities Act, and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered hereunder, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.

II-3

<PAGE> 119
SIGNATURES

In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form SB-2 and authorized this Registration
Statement to be signed on its behalf by the undersigned, in the City of Orlando,
State of Florida on June 21, 2000.

SOUTHERN COMMUNITY BANCORP

By: /s/ Charlie W. Brinkley, Jr.
---------------------------------------
Charlie W. Brinkley, Jr.
Chairman of the Board and Chief
Executive Officer

In accordance with the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates stated.

NAME TITLE DATE
---- ----- ----
<S> <C> <C>
/s/ Charlie W. Brinkley, Jr. Chairman of the Board and Chief June 21, 2000
------------------------------------------ Executive Officer (Principal
Charlie W. Brinkley, Jr. Executive Officer)

/s/ John G. Squires* President and Director June 21, 2000
-----------------------------------------
John G. Squires

/s/ Patrick J. Armstrong* Director June 21, 2000
-----------------------------------------
Patrick J. Armstrong

/s/ Richard M. Dunn* Director June 21, 2000
-----------------------------------------
Richard M. Dunn

/s/ Jennings L. Hurt, III* Director June 21, 2000
-----------------------------------------
Jennings L. Hurt, III

/s/ Eugene M. Pascarella* Director June 21, 2000
-----------------------------------------
Eugene M. Pascarella

Director
-----------------------------------------
Jon C. Peterson

/s/ Stanley H. Sandefur* Director June 21, 2000
-----------------------------------------
Stanley H. Sandefur

</TABLE>

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<PAGE> 120

<S> <C> <C>
/s/ Stephen R. Jeuck Chief Financial Officer and June 21, 2000
----------------------------------------- Secretary (Principal Financial and
Stephen R. Jeuck Principal Accounting Officer)

</TABLE>

* Executed pursuant to power of attorney dated as of April 20, 2000.

II-5

<PAGE> 121

EXHIBIT INDEX

Exhibit
Number Exhibit
------- -------
5.1 Opinion of Shutts & Bowen LLP

10.10 Escrow Agreement between the Registrant and SunTrust Bank

23.1 Consent of Hacker, Johnson, Cohen & Grieb, P.A.

23.2 Consent of Shutts & Bowen LLP (included in Exhibit 5.1)

27.1 Financial Data Schedule of Registrant for the three months
ended March 31, 2000

99.1 Consent of Richard Garner, Proposed Director

99.2 Consent of Joel Whittenhall, Proposed Director