U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

Form 10-Q
(Mark One)

[X]	Quarterly report under Section 13 or 15 (d) of the Securities Exchange Act of 1934
For the quarterly period ended June 30, 2002
[   ]	Transition report under Section 13 or 15 (d) of the Exchange Act

For the transition period from __________________ to ______________

Commission file number 333-95087

CENTERSTATE BANKS OF FLORIDA, INC.
(Exact Name of Small Business Issuer as Specified in Its Charter)

Florida	59-3606741
(State or Other Jurisdiction	(I.R.S. Employer
of Incorporation or Organization)	Identification No.)

7722 State Road 544 East
Winter Haven, Florida 33881
(Address of Principal Executive Offices)

(863) 419-0833
(Issuer’s Telephone Number, Including Area Code)

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

YES   [X]           NO   [   ]

State the number of shares outstanding of each of the issuer’s classes of common Equity, as of the latest practicable date:

Common stock, par value $.01 per share	2,825,758
(class)	Outstanding at June 30, 2002

TABLE OF CONTENTS

		CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
		CONDENSED CONSOLIDATED STATEMENT OF EARNINGS (unaudited)
		CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
		NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
	ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
PART II. OTHER INFORMATION
	Item 1. Legal Proceedings
	Item 2. Changes in Securities and Use of Proceeds
	Item 3. Defaults Upon Senior Securities
	Item 4. Submission of Matters to a Vote of Shareholders
	Item 5. Other Information
	Item 6. Exhibits and Reports on Form 8-K
SIGNATURES

CENTERSTATE BANKS OF FLORIDA, INC. AND SUBSIDIARIES

INDEX

	Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed consolidated balance sheets – June 30, 2002 (unaudited) and December 31, 2001 (unaudited)		2
Condensed consolidated statements of earnings for the three and six months ended June 30, 2002 and 2001 (unaudited)		3
Condensed consolidated statements of cash flows – six months ended June 30, 2002 and 2001 (unaudited)		4
Notes to condensed consolidated financial statements (unaudited)		5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		9
PART II. OTHER INFORMATION
Item 1. Legal Proceedings		20
Item 2. Changes in Securities and Use of Proceeds		20
Item 3. Defaults Upon Senior Securities		20
Item 4. Submission of Matters to a Vote of Shareholders		20
Item 5. Other Information		20
Item 6. Exhibits and Reports on Form 8-K		20
SIGNATURES		21

1

Centerstate Banks of Florida, Inc. and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(in thousands of dollars)

		As of			As of
		June 30, 2002			December 31, 2001
ASSETS
Cash and due from banks		$	17,850		$	17,401
Federal funds sold and money market			34,608			18,947
Securities:
	Available-for-sale (at market value)		40,766			43,961
	Held-to-Maturity (market value of $1,508 at December 31, 2001)		—			1,500
Loans			259,350			244,425
Less allowance for loan losses			(3,257	)		(3,076	)
	Net Loans		256,093			241,349
Premises and equipment			14,912			14,838
Accrued interest receivable			1,695			1,967
Other assets			1,462			1,411
TOTAL ASSETS		$	367,386		$	341,374
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
	Demand – non-interest bearing	$	64,443		$	53,698
	Demand – interest bearing		44,808			43,229
	Savings and money market accounts		79,546			77,010
	Time deposits		145,184			134,061
Total deposits			333,981			307,998
Securities sold under agreement to repurchase			4,121			4,598
Accrued expenses and other liabilities			840			961
	Total liabilities		338,942			313,557
Minority interest			110			100
Stockholders’ equity:
Preferred Stock, $.01 par value; 5,000,000 shares authorized no shares issued or outstanding			—			—
Common stock, $.01 par value: 20,000,000 shares authorized; 2,825,758 and 2,818,602 shares issued and outstanding at June 30, 2002 and December 31, 2001 respectively			28			28
Additional paid-in capital			15,497			15,450
Accumulated other comprehensive income			333			520
Retained earnings			12,476			11,719
Total stockholders’ equity			28,334			27,717
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	367,386		$	341,374

See notes to the accompanying condensed consolidated financial statements

2

Centerstate Banks of Florida, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENT OF EARNINGS (unaudited)

(in thousands of dollars, except per share data)

	Three months ended					Six months ended
	June 30, 2002			June 30, 2001		June 30, 2002		June 30, 2001
Interest income:
Loans	$	4,541		$	4,956	$	9,137	$	9,827
Investment securities		482			836		1,032		1,650
Federal funds sold		164			227		333		553
		5,187			6,019		10,502		12,030
Interest expense:
Deposits		1,659			2,562		3,437		5,271
Securities sold under agreement to repurchase		11			56		21		118
		1,670			2,618		3,458		5,389
Net interest income		3,517			3,401		7,044		6,641
Provision for loan losses		169			141		349		282
Net interest income after loan loss provision		3,348			3,260		6,695		6,359
Other income:
Service charges on deposit accounts		553			539		1,126		1,106
Other service charges and fees		302			153		599		308
Gain on sale of securities		10			—		21		—
Gain (loss) on sale of fixed asset		(2	)		—		18		9
		863			692		1,764		1,423
Other expenses:
Salaries, wages and employee benefits		1,611			1,448		3,292		2,832
Occupancy expense		442			390		863		765
Depreciation of premises and equipment		276			227		524		479
Stationary and printing supplies		106			95		190		177
Marketing expenses		49			44		103		105
Data processing expense		378			254		616		523
Legal and professional fees		111			56		181		107
Other expenses		485			480		1,018		947
Total other expenses		3,458			2,994		6,787		5,935
Income before provision for income taxes		753			958		1,672		1,847
Provision for income taxes		291			359		633		690
Minority interest in earnings of subsidiary		—			—		—		—
Net income	$	462		$	599	$	1,039	$	1,157
Earnings per share:
Basic	$	0.16		$	0.21	$	0.37	$	0.41
Diluted	$	0.16		$	0.21	$	0.36	$	0.41
Common shares used in the calculation of earnings per share:
Basic		2,822,423			2,816,006		2,820,625		2,815,939
Diluted		2,878,243			2,839,484		2,871,787		2,829,036

See notes to the accompanying condensed consolidated financial statements.

3

Centerstate Banks of Florida, Inc. and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

(in thousands of dollars)

					Six months ended June 30,
					2002			2001
Cash flows from operating activities:
	Net Income				$	1,039		$	1,157
	Adjustments to reconcile net income to net cash provided by operating activities:
		Provision for loan losses				349			282
		Depreciation of premises and equipment				524			479
		Net amortization/accretion of investments securities				47			31
		Net deferred origination fees				44			32
		Gain on sale of other real estate owned				—			(9	)
		Gain on sale of fixed asset				(18	)		—
		Deferred income taxes				1			(2	)
		Realized gain on sale of available for sale securities				(21	)		—
		Tax deduction in excess of book deduction on options exercised				9			3
	Cash provided by (used in) changes in:
			Net changes in accrued interest receivable			272			43
			Net change in other assets			123			(226	)
			Net change in accrued interest payable			(43	)		(35	)
			Net change in accrued expenses and other liabilities			(78	)		95
				Net cash provided by operating activities		2,248			1,850
Cash flows from investing activities:
	Proceeds from maturities of investment securities available for sale					14,500			2,500
	Proceeds from callable investment securities available for sale					1,080			2,035
	Proceeds from sales of investment securities available for sale					5,049			1,750
	Purchases of investment securities available for sale					(16,227	)		(13,555	)
	Purchases of mortgage back securities available for sale					(2,075	)		—
	Proceeds from pay-downs of mortgage back securities available for sale					545			198
	Proceeds from maturities of investment securities held to maturity					1,500			—
	Increase in loans, net of repayments					(15,202	)		(18,676	)
	Purchases of premises and equipment					(649	)		(987	)
	Proceeds from sale of other real estate owned					—			149
	Proceeds from sale of fixed asset					69			—
				Net cash used in investing activities		(11,410	)		(24,586	)
Cash flows from financing activities:
	Net increase in demand and savings deposits					25,983			17,547
	Net increase in other borrowings					(477	)		1,155
	Stock options exercised					38			9
	Net increase in minority interest of subsidiary					10			—
	Dividends paid					(282	)		(225	)
				Net cash provided by financing activities		25,272			18,486
				Net increase (decrease) in cash and cash equivalents		16,110			(4,250	)
Cash and cash equivalents, beginning of period						36,348			33,584
Cash and cash equivalents, end of period					$	52,458		$	29,334
Supplemental schedule of noncash transactions:
	Market value adjustment- securities available-for-sale
		Market value adjustments- securities			$	297		$	599
		Deferred income tax liability				(110	)		(225	)
	Unrealized gain on securities available-for-sale				$	187		$	374
Transfer of loan to other real estate owned					$	65			—
Cash paid during the period for:
	Interest				$	3,501		$	5,425
	Income taxes				$	891		$	875

See notes to the accompanying condensed consolidated financial statements.

4

CenterState Banks of Florida, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTE 1:     Holding company and subsidiaries background information

     CenterState Banks of Florida, Inc (the “Company”) is a multi-bank holding company that was formed as part of a merger of three independent commercial banks in Central Florida (First National Bank of Osceola County, Community National Bank of Pasco County and First National Bank of Polk County). First National Bank of Osceola County is a national bank chartered in September 1989. It operates from three full service locations and one remote location within Osceola County and two full service locations in Orange County, which is contiguous with Osceola County. Community National Bank of Pasco County is a national bank chartered in November 1989. It operates from seven full service locations within Pasco and contiguous counties. First National Bank of Polk County is a national bank chartered in February 1992. It operates from four full service locations within Polk County. The Company, through its subsidiary banks, provides traditional deposit and lending products and services to its commercial and retail customers. The three banks maintain their separate identities as wholly owned subsidiaries of the Company.

     C. S. Processing, Inc. is a majority owned (75%) subsidiary of the Company. The three wholly owned subsidiary banks of the Company each own 25%, and the remaining 25% is owned by a minority shareholder, another bank. The Company’s investment in the subsidiary to date is $330,000 and the minority shareholder contributed $110,000. C. S. Processing processes checks and renders statements (i.e. “item processing center”) for the Company’s three subsidiary banks and for Centerstate Bank (see note 6 below, merger with Centerstate Bank). Operations began during July 2001. The Company’s last subsidiary bank converted in April 2002. The subsidiary operates on a break-even basis. Its operating expenses are charged to each bank as fees based on the bank’s usage.

5

NOTE 2:     Basis of presentation

     The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. These statements should be read in conjunction with the consolidated financial statements included in the Company’s Annual Report on Form 10-KSB for the year ended December 31, 2001. In the opinion of management, all adjustments, consisting primarily of normal recurring adjustments, necessary for a fair presentation of the results for the interim periods have been made. The results of operations of the three and six month periods ended June 30, 2002 are not necessarily indicative of the results expected for the full year.

NOTE 3:     Common stock outstanding and earnings per share data

     Basic earnings per share is based on the weighted average number of common shares outstanding during the periods. Diluted earnings per share includes the weighted average number of common shares outstanding during the periods and the further dilution from stock options using the treasury method. The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per share computations for the periods presented (dollars are in thousands, except per share data).

		For the three months ended June 30,
		2002						2001
				Weighted		Per				Weighted		Per
				Average		Share				Average		Share
		Earnings		Shares		Amount		Earnings		Shares		Amount
Basic EPS
	Net earnings available To common Shareholders	$	462		2,822,423	$	0.16	$	599		2,816,006	$	0.21
Effect of dilutive securities:
Incremental shares from assumed exercise of stock Options		$	0		55,820			$	0		23,478
Diluted EPS
	Net earnings available to common shareholders and assumed Conversions	$	462		2,878,243	$	0.16	$	599		2,839,484	$	0.21

6

		For the six months ended June 30,
		2002						2001
				Weighted		Per				Weighted		Per
				Average		Share				Average		Share
		Earnings		Shares		Amount		Earnings		Shares		Amount
Basic EPS
	Net earnings available to common Shareholders	$	1,039		2,820,625	$	0.37	$	1,157		2,815,939	$	0.41
Effect of dilutive securities:
Incremental shares from assumed exercise of stock Options		$	0		51,162			$	0		13,097
Diluted EPS
	Net earnings available to common shareholders and assumed Conversions	$	1,039		2,871,787	$	0.36	$	1,157		2,829,036	$	0.41

NOTE 4:    Comprehensive income

     Under Statement of Financial Accounting Standards No. 130, “Reporting Comprehensive Income,” certain transactions and other economic events that bypass the income statement must be displayed as other comprehensive income. The Company’s comprehensive income consists of net earnings and unrealized gains and losses on securities available-for-sale, net of deferred income taxes.

     The table below sets forth the Company’s comprehensive income for the periods indicated below (in thousands of dollars).

		Three months ended				Six months ended
		Jun 30, 2002		Jun 30, 2001		Jun 30, 2002			Jun 30, 2001
Net income		$	462	$	599	$	1,039		$	1,157
Other comprehensive income, net of tax:
	Unrealized holding (loss) gain arising during the period		63		50		(200	)		374
	Add: reclassified adjustments for gains included in net income, net of income taxes of $4 and $8 for the three and six month periods ended June 30, 2002		6		—		13			—
Other comprehensive income (loss), net of tax			69		50		(187	)		374
Comprehensive income		$	531	$	649	$	852		$	1,531

NOTE 5:     Effect of new pronouncements

     In June 2001, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 141, “Business Combinations.” This Statement addresses financial accounting and reporting for business combinations and supersedes Accounting Principles Board (“APB”) Opinion No. 16, Business Combinations, and FASB Statement No. 38, Accounting for Preacquisition Contingencies of Purchased Enterprises. All business combinations in the scope of this Statement are to be accounted for using one method, the purchase method. The provisions of this Statement apply to all business combinations initiated after June 30, 2001. This Statement also applies to all business combinations accounted for using the purchase method for which the date of acquisition is July 1, 2001, or later. Adoption of this Statement did not have a significant impact on the financial position or results of operations of the Company.

7

     In June 2001, the FASB issued SFAS No. 142, “Goodwill and Other Intangible Assets.” This Statement addresses financial accounting and reporting for acquired goodwill and other intangible assets and supersedes APB Opinion No. 17, Intangible Assets. It addresses how intangible assets that are acquired individually or with a group of other assets (but not those acquired in a business combination) should be accounted for in financial statements upon their acquisition. This Statement also addresses how goodwill and other intangible assets should be accounted for after they have been initially recognized in the financial statements. Enterprises are required to adopt SFAS No. 142 for fiscal years beginning after December 15, 2001. Adoption of this Statement did not have a significant impact on the financial position or results of operations of the Company.

     In June 2001, the FASB issued SFAS No. 143, “Accounting for Asset Retirement Obligations.” This Statement addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. This Statement applies to all entities that have legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development or normal use of the asset. As used in this Statement, a legal obligation results from existing law, statute, ordinance, written or oral contract, or by legal construction of a contract under the doctrine of promissory estoppel. Enterprises are required to adopt SFAS No. 143 for fiscal years beginning after June 15, 2002. Management does not expect the impact of adopting the provisions of SFAS 143 to significantly impact the financial position or results of operations of the Company.

     In August 2001, the FASB issued SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets.” This Statement addresses financial accounting and reporting for the impairment or disposal of long-lived assets. This Statement supersedes FASB Statement No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of, and the accounting and reporting provisions of APB Opinion No. 30, Reporting the Results of Operations—Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions, for the disposal of a segment of a business (as previously defined in that Opinion). This Statement also amends Accounting Research Bulletin (“ARB”) No. 51, Consolidated Financial Statements, to eliminate the exception to consolidation for a subsidiary for which control is likely to be temporary. The provisions of this Statement are effective for financial statements issued for fiscal years beginning after December 15, 2001, and interim periods within those fiscal years. Adoption of this Statement did not have a significant impact on the financial position or results of operations of the Company.

NOTE 6:     Merger

     On April 16, 2002, the Company announced that a letter of intent was signed with CenterState Bank of Florida (a non publicly traded commercial bank). The Company will acquire CenterState Bank of Florida in a stock and cash transaction. Shareholders of CenterState Bank will receive $2.40 cash and .53631 share of the Company’s common stock for each share of common stock of CenterState Bank. The Company intends to account for this transaction using the purchase method of accounting.

8

ITEM 2:    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Some of the statements in this report constitute forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995 and the Securities Exchange Act of 1934. These statements related to future events, other future financial performance or business strategies, and may be identified by terminology such as “may,’’ “will,’’ “should,’’ “expects,’’ “scheduled,’’ “plans,’’ “intends’’, “anticipates,’’ “believes,’’ “estimates,’’ “potential,’’ or “continue” or the negative of such terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially. In evaluating these statements, you should specifically consider the factors described throughout this report. We cannot be assured that future results, levels of activity, performance or goals will be achieved.

COMPARISON OF BALANCE SHEETS AT JUNE 30, 2002 AND DECEMBER 31, 2001

Overview

     Total assets of the Company were $367.4 million as of June 30, 2002, compared to $341.4 million at December 31, 2001, an increase of $26 million or 7.6%. This increase was primarily the result of the Company’s internally generated loan growth funded by an increase in deposits.

Federal funds sold and money market

     Federal funds sold and money market was $34.6 million at June 30, 2002 as compared to $18.9 million at December 31, 2001, an increase of $15.7 million or 83%. The Company has increased federal funds sold and money market, primarily due to the relatively low rate of yields offered on short term U.S. Treasury and government agency securities.

Investment securities

     Securities available-for-sale, consisting primarily of U.S. Treasury and government agency securities, were $40.8 million at June 30, 2002 compared to $44.0 million at December 31, 2001, a decrease of $3.2 million or 7.3%. These securities have been recorded at market value. The Company classifies its securities as “available-for-sale” to provide for greater flexibility to respond to changes in interest rates. The U.S. governmental agency security that was classified as held-to-maturity at December 31, 2001 ($1.5 million) matured during February 2002. As of June 30, 2002, the Company does not own any investments classified as held-to-maturity.

Loans

     Total gross loans were $259.8 million at June 30, 2002, compared to $244.9 million at December 31, 2001, an increase of $14.9 million or 6.1%. For the same period, real estate loans increased by $15.8 million or 8.3%, commercial loans increased by $1.9 million or 6.0%, and all other loans including consumer loans decreased by $2.8 million or 12%. Total loans net of unearned fees and allowance for loan losses were $256.1 million at June 30, 2002, compared to $241.3 million at December 31, 2001, an increase of $14.8 million or 6.1%.

9

     The following table sets forth information concerning the loan portfolio by collateral types as of the dates indicated (dollars are in thousands).

		June 30,			Dec 31,
		2002			2001
Real Estate Loans
	Residential	$	95,631		$	84,033
	Commercial		94,639			88,711
	Construction		16,260			17,917
Total Real Estate			206,530			190,661
Commercial			32,766			30,900
Other			20,530			23,295
	Gross Loans		259,826			244,856
Unearned fees			(476	)		(431	)
	Total loans net of unearned fees		259,350			244,425
Allowance for loan losses			(3,257	)		(3,076	)
Total loans net of unearned fees and allowance for loan losses		$	256,093		$	241,349

Credit quality and allowance for loan losses

     The Company’s allowance for loan losses represents management’s estimate of an amount adequate to provide for potential losses within the existing loan portfolio. Loans are charged against the allowance when management believes collection of the principal is unlikely. The allowance consists of amounts established for specific loans and is also based on historical loan loss experience. The specific reserve element is the result of a regular analysis of all loans and commitments based on credit rating classifications and other factors. Management also weighs general economic conditions based on knowledge of specific factors that may affect the collectibility of loans. At June 30, 2002, the allowance for loan losses was $3.3 million or 1.26% of total loans outstanding, compared to $3.1 million or 1.26%, at December 31, 2001.

     The following table sets forth information concerning the activity in the allowance for loan losses during the periods indicated (in thousands of dollars).

		Six month period end June 30,
		2002		2001
Allowance at beginning of period		$	3,076	$	2,730
Charge-offs
	Commercial Loans		21		—
	Real Estate Loans		127		62
	Consumer Loans		42		66
Total charge-offs			190		128
Recoveries
	Commercial Loans		1		3
	Real Estate Loans		3		19
	Consumer Loans		18		15
Total Recoveries			22		37
Net charge-offs (recoveries)			168		91
Provision for loan losses			349		282
Allowance at end of period		$	3,257	$	2,921

10

Nonperforming assets

     Nonperforming assets include (1) non-accrual loans; (2) accruing loans that are 90 days or more delinquent that are deemed by management to be adequately secured and in the process of collection; (3) OREO (i.e. real estate acquired through foreclosure or deed in lieu of foreclosure); and (4) other repossessed assets (not real estate). All delinquent loans are reviewed on a regular basis and are placed on non-accrual status when, in the opinion of management, the possibility of collecting additional interest is deemed insufficient to warrant further accrual. As a matter of policy, interest is not accrued on loans past due 90 days or more unless the loan is both well secured and in the process of collection. When a loan is placed on non-accrual status, interest accruals cease and uncollected accrued interest is reversed and charged against current income. Additional interest income on such loans is recognized only when received.

     The following table sets forth information regarding the components of nonperforming assets at the dates indicated (in thousands of dollars).

	June 30			Dec 31
	2002			2001
Non-Accrual Loans	$	117		$	580
Accruing Loans Past Due over 90 days		178			64
Other Real Estate Owned		65			—
Repossessed assets other than real estate		25			15
Total Non-Performing Assets	$	385		$	659
As a Percent of Total Assets		0.10	%		0.19	%
Allowance for Loan Losses	$	3,257		$	3,076
Allowance for loan losses to non performing loans		846	%		467	%

     Management is continually analyzing its loan portfolio in an effort to recognize and resolve its problem assets as quickly and efficiently as possible. As of June 30, 2002, management believes that its allowance for loan losses was adequate. However, management recognizes that many factors can adversely impact various segments of its market. Accordingly, there is no assurance that losses in excess of such reserves will not be incurred.

Bank premises and equipment

     Bank premises and equipment was $14.9 million at June 30, 2002 compared to $14.8 million at December 31, 2001, an increase of $0.1 million or 0.7%.

     C. S. Processing, Inc.

     C. S. Processing, Inc. is a majority owned (75%) subsidiary of the Company. The three wholly owned subsidiary banks of the Company each own 25%, and the remaining 25% is owned by Centerstate Bank (see merger note 6, below). At June 30, 2002, the Company’s investment in the subsidiary to date was $330,000 and Centerstate Bank contributed $110,000. C. S. Processing processes checks and renders statements (i.e. “item processing center”) for the Company’s three subsidiary banks and for Centerstate Bank. Operations began during July 2001. The last subsidiary bank to convert did so in April 2002.

11

Deposits

     Total deposits were $334 million at June 30, 2002, compared to $308 million at December 31, 2001, an increase of $26 million or 8.4%. During the six month period ended June 30, 2002, demand deposits increased by $10.8 million (20.0%), NOW deposits increased by $1.6 million (3.7%), savings and money market accounts increased by $2.5 million (3.2%), and time deposits increased by $11.1 million (8.3%).

Repurchase agreements

     The Company enters into agreements to repurchase securities under which the Company pledges investment securities owned and under its control as collateral against borrowed funds. These short-term borrowings totaled $4.1 million at June 30, 2002 compared to $4.6 million at December 31, 2001, a decrease of $0.5 million, or 10.9%.

Stockholders’ equity

     Shareholders’ equity at June 30, 2002, was $28.3 million, or 7.7% of total assets, compared to $27.7 million, or 8.1% of total assets at December 31, 2001. The increase in stockholders’ equity was due to year-to-date net income ($1.039 million) and stock options exercised ($47 thousand) less dividends paid ($282 thousand), and a net decrease in the market value of securities available for sale, net of deferred taxes ($187 thousand). The Company paid a dividend of $0.05 per share on March 29, 2002 to shareholders of record as of the close of business on March 15, 2002, and $0.05 per share on June 28, 2002 to shareholders of record as of the close of business on June 14, 2002.

     The Comptroller of the Currency has established risk-based capital requirements for national banks. These guidelines are intended to provide an additional measure of a bank’s capital adequacy by assigning weighted levels of risk to asset categories. Banks are also required to systematically maintain capital against such “off- balance sheet” activities as loans sold with recourse, loan commitments, guarantees and standby letters of credit. These guidelines are intended to strengthen the quality of capital by increasing the emphasis on common equity and restricting the amount of loan loss reserves and other forms of equity such as preferred stock that may be included in capital. As of June 30, 2002, each of the Company’s three subsidiary banks exceeded the minimum capital levels to be considered “Well Capitalized” under the terms of the guidelines.

     Selected consolidated capital ratios at June 30, 2002 and December 31, 2001 are presented in the table below.

		Actual					Well capitalized					Excess
		Amount		Ratio			Amount		Ratio			Amount
June 30, 2002
	Total capital (to risk weighted assets)	$	30,921		12.4	%	$	24,980		> 10	%	$	5,941
	Tier 1 capital (to risk weighted assets)		27,797		11.1	%		14,988		> 6	%		12,809
	Tier 1 capital (to average assets)		27,797		7.6	%		18,190		> 5	%		9,607
December 31, 2001
	Total capital (to risk weighted assets)	$	29,805		12.8	%	$	23,358		> 10	%	$	6,447
	Tier 1 capital (to risk weighted assets)		26,883		11.5	%		14,015		> 6	%		12,868
	Tier 1 capital (to average assets)		26,883		7.9	%		17,033		> 5	%		9,850

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COMPARISON OF RESULTS OF OPERATIONS FOR THE THREE MONTH PERIODS ENDED JUNE 30, 2002 AND 2001

Overview

     Net income for the three months ended June 30, 2002 was $462 thousand or $0.16 per share basic and $0.16 per share diluted, compared to $599 thousand or $0.21 per share basic and $0.21 per share diluted for the same period in 2001. Data processing conversion expenses of approximately $234 thousand (approximately $146 thousand net of tax) was recognized during this period. If not for these data processing conversion expenses, net income would have been approximately $608 thousand or $0.22 per share basic and $0.21 per share diluted. Data processing conversion expense is discussed below under the topic of non interest expenses.

     The return on average equity (“ROE”), calculated on an annualized basis, for the three month period ended June 30, 2002 was 6.60%, as compared to 9.05% for the same period in 2001.

Net interest income/margin

     Net interest income increased $116 thousand or 3.4% to $3.517 million during the three month period ended June 30, 2002 compared to $3.401 million for the same period in 2001. The $116 thousand increase was the result of a $832 thousand decrease in interest income and a $948 thousand decrease in interest expense.

     Interest earning assets averaged $334.4 million during the three month period ended June 30, 2002 as compared to $304.3 million for the same period in 2001, an increase of $30.1 million, or 9.9%. The yield on average interest earning assets decreased 1.70% to 6.21% during the three month period ended June 30, 2002, compared to 7.91% for the same period in 2001. The combined net effects of the $30.1 million increase in average interest earning assets and the 1.70% decrease in yield on average interest earning assets resulted in the $832 thousand decrease in interest income between the two periods.

     Interest bearing liabilities averaged $273.7 million during the three month period ended June 30, 2002 as compared to $252.2 million for the same period in 2001, an increase of $21.5 million, or 8.5%. The cost of average interest bearing liabilities decreased 1.71% to 2.44% during the three month period ended June 30, 2002, compared to 4.15% for the same period in 2001. The combined net effects of the $21.5 million increase in average interest bearing liabilities and the 1.71% decrease in cost on average interest bearing liabilities resulted in the $948 thousand decrease in interest expense between the two periods.

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     The table below summarizes, the analysis of changes in interest income and interest expense for the three month periods ended June 30, 2002 and 2001 (in thousands of dollars).

	Three months ended June 30,
	2002								2001
	Average			Interest		Average			Average			Interest		Average
	Balance			Inc/Exp		Rate			Balance			Inc/Exp		Rate
Loans (1) (2)	$	255,403		$	4,541		7.11	%	$	224,680		$	4,956		8.82	%
Securities (3)		78,956			646		3.27	%		79,641			1,063		5.34	%
Total Earning Assets		334,359			5,187		6.21	%		304,321			6,019		7.91	%
Allowance for loan losses		(3,292	)							(2,868	)
All other assets		32,933								28,875
Total Assets	$	364,000							$	330,328
Deposits (4)		269,614			1,659		2.46	%		246,488			2,562		4.16	%
Borrowings		4,044			11		1.09	%		5,705			56		3.93	%
Total Interest Bearing Liabilities		273,658			1,670		2.44	%		252,193			2,618		4.15	%
Demand deposits		60,935								50,793
Other liabilities		1,280								869
Minority shareholder interest		109								—
Shareholders’ Equity		28,018								26,473
Total Liabilities and Shareholders’ Equity	$	364,000							$	330,328
Net Interest Spread (5)							3.77	%							3.76	%
Net Interest Income				$	3,517							$	3,401
Net Interest Margin (6)							4.21	%							4.47	%

Note 1:	Loan balances are net of deferred origination fees and costs.
Note 2:	Interest income on average loans includes loan fee recognition of $48 thousand and $260 thousand for the three month periods ended June 30, 2002 and 2001.
Note 3:	Includes securities available-for-sale, securities held-to-maturity, federal funds sold and money market.
Note 4:	Includes interest bearing deposits only. Non-interest bearing checking accounts are included in the demand deposits listed above.
Note 5:	Represents the average rate earned on interest earning assets minus the average rate paid on interest bearing liabilities.
Note 6:	Represents net interest income divided by total interest earning assets.

Provision for loan losses

     The provision for loan losses is charged to earnings to bring the total allowance to a level deemed appropriate by management and is based upon historical experience, the volume and type of lending conducted by the Company, industry standards, the amount of nonperforming loans, general economic conditions, particularly as they relate to the Company’s market areas, and other factors related to the collectibility of the Company’s loan portfolio. As these factors change, the level of loan loss provision changes. The provision was $169 thousand for the three month period ended June 30, 2002 compared to $141 thousand for the same period in 2001. The increase was primarily due to the increase in the loan portfolio.

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Non-interest income

     Non-interest income for the three months ended June 30, 2002 increased $171 thousand, or 24.7%, to $863 thousand, compared to $692 thousand for the same period in 2001. A portion of the increase ($14 thousand) related to deposit account service charges. Item processing fees, net of inter-company fees (C. S. Processing,Inc. commenced operations in July 2001) increased by $16 thousand. Securities were sold resulting in a gain of $10 thousand. Commissions earned through “Money Concepts” (sale of mutual funds and annuities) increased approximately $35 thousand. The largest portion of the increase ($96 thousand) was related to other service charges and miscellaneous items. Non-interest income (annualized) as a percentage of total average assets was 0.95% for the three months ended June 30, 2002, compared to 0.84% for the same period in 2001.

Non-interest expense

     Non-interest expense for the three months ended June 30, 2002 increased $464 thousand, or 15.5%, to $3.458 million, compared to $2.994 million for the same period in 2001. Salaries and employee benefits increased by $163 thousand (11.3%), occupancy and depreciation expenses increased by $101 thousand (16.4%), data processing expenses (includes item processing and conversion expenses) increased by $124 thousand (48.8%), and all remaining expenses together resulted in an increase of $76 thousand (11.1%).

     A new branch opened in September 2001, which contributed to higher salaries/employee benefits, data processing expense, and occupancy expenses.

     The Company’s new subsidiary, C. S. Processing opened in July 2001, which contributed to higher salaries/employee benefits and occupancy expenses. Because this function is now performed in house, data processing expense (exclusive of conversion expenses) decreased, and salary/employee benefits and occupancy expenses increased. The effect of the decrease in data processing was not apparent due to conversion expenses recognized by two of our three banks. The conversion expense relates to the conversion to a new core data processing service bureau. Approximately $234 thousand of data processing expense related to conversion expense was recognized during the three month period ending June 30, 2002. Without these conversion expenses, data processing expense would have decreased by $110 thousand instead of increase by $124 thousand.

     All three of the Company’s subsidiary banks have now completed their conversions as of April 2002. All three are now using the same service bureau for its core data processing, and the same general ledger with the same standard chart of accounts. In addition, all three subsidiary banks have also converted their item processing to the Company’s majority owned (75%) subsidiary. In addition to the expected future efficiencies and cost savings, management believes this strategy of control over the process will enhance the quality of the service provided the customer. Centestate Bank is currently using the same service bureau for its core data processing. Management does not expect to incur any significant additional data processing conversion expenses with regard to the proposed merger with Centerstate Bank.

Provision for income taxes

     The income tax provision for the three months ended June 30, 2002 was $291 thousand (an effective rate of 38.6%) compared to $359 thousand (an effective rate of 37.5%) for the same period in 2001.

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COMPARISON OF RESULTS OF OPERATIONS FOR THE SIX MONTH PERIODS ENDED JUNE 30, 2002 AND 2001

Overview

     Net income for the six months ended June 30, 2002 was $1.039 million or $0.37 per share basic and $0.36 per share diluted, compared to $1.157 million or $0.41 per share basic and $0.41 per share diluted for the same period in 2001. Data processing conversion expenses of approximately $296 thousand (approximately $185 thousand net of tax) was recognized during this period. If not for these data processing conversion expenses, net income would have been approximately $1.224 million or $0.43 per share basic and $0.43 per share diluted. Data processing conversion expense is discussed below under the topic of non interest expenses.

     The return on average equity (“ROE”), calculated on an annualized basis, for the six month period ended June 30, 2002 was 7.41%, as compared to 8.92% for the same period in 2001.

Net interest income/margin

     Net interest income increased $403 thousand or 6.1% to $7.044 million during the six month period ended June 30, 2002 compared to $6.641 million for the same period in 2001. The $403 thousand increase was the result of a $1.528 million decrease in interest income and a $1.931 million decrease in interest expense.

     Interest earning assets averaged $330.7 million during the six month period ended June 30, 2002 as compared to $299.5 million for the same period in 2001, an increase of $31.2 million, or 10.4%. The yield on average interest earning assets decreased 1.68% to 6.35% during the six month period ended June 30, 2002, compared to 8.03% for the same period in 2001. The combined net effects of the $31.2 million increase in average interest earning assets and the 1.68% decrease in yield on average interest earning assets resulted in the $1.528 million decrease in interest income between the two periods.

     Interest bearing liabilities averaged $273.3 million during the six month period ended June 30, 2002 as compared to $250.0 million for the same period in 2001, an increase of $23.3 million, or 9.3%. The cost of average interest bearing liabilities decreased 1.78% to 2.53% during the six month period ended June 30, 2002, compared to 4.31% for the same period in 2001. The combined net effects of the $23.3 million increase in average interest bearing liabilities and the 1.78% decrease in cost on average interest bearing liabilities resulted in the $1.931 million decrease in interest expense between the two periods.

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     The table below summarizes, the analysis of changes in interest income and interest expense for the six month periods ended June 30, 2002 and 2001 (in thousands of dollars).

	Six months ended June 30,
	2002								2001
	Average			Interest		Average			Average			Interest		Average
	Balance			Inc/Exp		Rate			Balance			Inc/Exp		Rate
Loans (1) (2)	$	251,594		$	9,137		7.26	%	$	219,790		$	9,827		8.94	%
Securities (3)		79,087			1,365		3.45	%		79,707			2,203		5.53	%
Total Earning Assets		330,681			10,502		6.35	%		299,497			12,030		8.03	%
Allowance for loan losses		(3,215	)							(2,834	)
All other assets		34,569								29,012
Total Assets	$	362,035							$	325,675
Deposits (4)		269,121			3,437		2.55	%		244,790			5,271		4.31	%
Borrowings		4,151			21		1.01	%		5,234			118		4.51	%
Total Interest Bearing Liabilities		273,272			3,458		2.53	%		250,024			5,389		4.31	%
Demand deposits		59,486								48,754
Other liabilities		1,111								951
Minority shareholder interest		105								—
Shareholders’ Equity		28,061								25,946
Total Liabilities and Shareholders’ Equity	$	362,035							$	325,675
Net Interest Spread (5)							3.82	%							3.72	%
Net Interest Income				$	7,044							$	6,641
Net Interest Margin (6)							4.26	%							4.43	%

Note 1:	Loan balances are net of deferred origination fees and costs.
Note 2:	Interest income on average loans includes loan fee recognition of $234 thousand and $442 thousand for the six month periods ended June 30, 2002 and 2001.
Note 3:	Includes securities available-for-sale, securities held-to-maturity, federal funds sold and money market.
Note 4:	Includes interest bearing deposits only. Non-interest bearing checking accounts are included in the demand deposits listed above.
Note 5:	Represents the average rate earned on interest earning assets minus the average rate paid on interest bearing liabilities.
Note 6:	Represents net interest income divided by total interest earning assets.

Provision for loan losses

     The provision for loan losses is charged to earnings to bring the total allowance to a level deemed appropriate by management and is based upon historical experience, the volume and type of lending conducted by the Company, industry standards, the amount of nonperforming loans, general economic conditions, particularly as they relate to the Company’s market areas, and other factors related to the collectibility of the Company’s loan portfolio. As these factors change, the level of loan loss provision changes. The provision was $349 thousand for the six month period ended June 30, 2002 compared to $282 thousand for the same period in 2001. The increase was primarily due to the increase in the loan portfolio.

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Non-interest income

     Non-interest income for the six months ended June 30, 2002 increased $341 thousand, or 24.0%, to $1.764 million, compared to $1.423 million for the same period in 2001. A portion of the increase ($20 thousand) related to deposit account service charges. Item processing fees, net of inter-company fees (C. S. Processing,Inc. commenced operations in July 2001) increased by $37 thousand. A strip of unused land next to one of the Company’s branches was sold resulting in a $20 thousand gain on the sale. Securities were sold resulting in a gain of $21 thousand. Commissions earned through “Money Concepts” (sale of mutual funds and annuities) increased approximately $75 thousand. The largest portion of the increase ($168 thousand) was related to other service charges and miscellaneous items. Non-interest income (annualized) as a percentage of total average assets was 0.97% for the six months ended June 30, 2002, compared to 0.87% for the same period in 2001.

Non-interest expense

     Non-interest expense for the six months ended June 30, 2002 increased $852 thousand, or 14.4%, to $6.787 million, compared to $5.935 million for the same period in 2001. Salaries and employee benefits increased by $460 thousand (16.2%), occupancy and depreciation expenses increased by $143 thousand (11.5%), data processing expenses (includes item processing and conversion expenses) increased by $93 thousand (17.8%), and all remaining expenses together resulted in an increase of $156 thousand (11.7%).

     A new branch opened in September 2001, which contributed to higher salaries/employee benefits, data processing expense, and occupancy expenses.

     The Company’s new subsidiary, C. S. Processing opened in July 2001, which contributed to higher salaries/employee benefits and occupancy expenses. Because this function is now performed in house, data processing expense decreased (exclusive of conversion expenses), and salary/employee benefits and occupancy expenses increased. The effect of the decrease in data processing was not apparent due to conversion expenses recognized by two of our three banks. The conversion expense relates to the conversion to a new core data processing service bureau. Approximately $296 thousand of data processing expense related to conversion expense was recognized during the six month period ending June 30, 2002. Without these conversion expenses, data processing expense would have decreased by $203 thousand instead of increase by $93 thousand.

     All three of the Company’s subsidiary banks have now completed their conversions as of April 2002. All three are now using the same service bureau for its core data processing, and the same general ledger with the same standard chart of accounts. In addition, all three subsidiary banks have also converted their item processing to the Company’s majority owned (75%) subsidiary. In addition to the expected future efficiencies and cost savings, management believes this strategy of control over the process will enhance the quality of the service provided the customer.

Provision for income taxes

     The income tax provision for the six months ended June 30, 2002 was $633 thousand (an effective rate of 37.9%) compared to $690 thousand (an effective rate of 37.4%) for the same period in 2001.

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Liquidity

     Liquidity is defined as the ability to meet anticipated customer demands for funds under credit commitments and deposit withdrawals at a reasonable cost and on a timely basis. Management measures the liquidity position by giving consideration to both on- and off-balance sheet sources of and demands for funds on a daily and weekly basis.

     Each of the Company’s subsidiary banks regularly assesses the amount and likelihood of projected funding requirements through a review of factors such as historical deposit volatility and funding patterns, present and forecasted market and economic conditions, individual client funding needs, and existing and planned business activities. Each subsidiary bank’s asset/liability committee (ALCO) provides oversight to the liquidity management process and recommends guidelines, subject to board of director’s approval, and courses of action to address actual and projected liquidity needs.

     Short term sources of funding and liquidity include cash and cash equivalents, net of federal requirements to maintain reserves against deposit liabilities; investment securities eligible for pledging to secure borrowings from dealers and customers pursuant to securities sold under repurchase agreements; loan repayments; deposits and certain interest rate-sensitive deposits; and borrowings under overnight federal fund lines available from correspondent banks. In addition to interest rate-sensitive deposits, the primary demand for liquidity is anticipated fundings under credit commitments to customers. The Company does not use off balance sheet financing. Management believes that it is reasonably likely these funding sources will be available in the future.

Market Risk

     Interest rate risk is the most significant market risk impacting the Company. Each subsidiary bank monitors and manages its interest rate risk using interest rate sensitivity “gap” analysis to measure the impact of market interest rate changes on net interest income. See the Company’s 2001 annual report on Form 10-KSB for disclosure of the quantitative and qualitative information regarding the interest rate risk inherent in interest rate risk sensitive instruments as of December 31, 2001. There have been no changes in the assumptions used in monitoring interest rate risk as of June 30, 2002. The impact of other types of market risk, such as foreign currency exchange risk and equity price risk, is deemed immaterial. The Company does not maintain a portfolio of trading securities and does not intend to engage in such activities in the immediate future.

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PART II. OTHER INFORMATION

Item 1.     Legal Proceedings

None.

Item 2.     Changes in Securities and Use of Proceeds

None.

Item 3.     Defaults Upon Senior Securities

None.

Item 4.     Submission of Matters to a Vote of Shareholders

At the April 23, 2002 annual shareholders’ meeting, the Company’s shareholders reelected all the Company’s Directors and ratified KPMG LLP as the Company’s independent auditors

Item 5.     Other Information

None.

Item 6.     Exhibits and Reports on Form 8-K

On April 16, 2002, the Company filed a Form 8-K announcing its intent to merge with CenteState Bank of Florida.

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CENTERSTATE BANKS OF FLORIDA, INC.

SIGNATURES

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

CERTIFICATION

     Each of the undersigned do hereby certify that this report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in the report fairly presents, in all material respects, the financial condition and results of operation of the Issuer.

CENTERSTATE BANKS OF FLORIDA, INC.
(Registrant)

Date:	August 8, 2002	By:	/s/ JAMES H. WHITE
		James H. White Chief Executive Officer
Date:	August 8, 2002	By:	/s/ ERNEST S. PINNER
		Ernest S. Pinner President
Date:	August 8, 2002	By:	/s/ JAMES J. ANTAL
		James J. Antal Senior Vice President and Chief Financial Officer

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