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                      SECURITIES AND EXCHANGE COMMISSION
                                      
                            WASHINGTON, D.C. 20549
                                      
                                   FORM 8-K
                                      
                                CURRENT REPORT
                                      
              PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
                             EXCHANGE ACT OF 1934
                                      
  Date of Report (Date of earliest event reported):          December 21, 1998
                                      
                                      
                         THE COLONIAL BANCGROUP, INC.
            (Exact name of registrant as specified in its charter)
                                      
           Delaware                 1-13508             63-0661573
 (State of Incorporation)    (Commission File No.)   (IRS Employer I.D. No.)


     One Commerce Street, Montgomery, Alabama                   36104
     (Address of Principal Executive Office)                  (Zip Code)
 

      Registrant's telephone number, including area code:  334-240-5000




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Item 5. OTHER EVENTS

                     COLONIAL BANCGROUP ANNOUNCES ONE-TIME

                             FOURTH QUARTER CHARGES


     MONTGOMERY, AL -- Colonial BancGroup announced today that it anticipates  
fourth quarter earnings significantly below 1997 fourth quarter earnings due to 
an anticipated $30 million write-down in the value of mortgage servicing rights 
on the books of its bank subsidiary, Colonial Mortgage Company. The Company 
also announced non-recurring pretax charges of $32 million in acquisition, 
restructuring and other one-time charges. The Company believes that these 
charges will negatively affect fourth quarter earnings, but that they should 
provide a basis for improved earnings going forward into 1999.

     The write-down associated with mortgage servicing rights is occasioned by 
decreases in mortgage interest rates which have, in turn, accelerated 
pre-payments of mortgages in October and November. In addition, management now 
believes that future pre-payments may be greater than previously anticipated. 
The write-down establishes a reserve against loss occasioned by future 
accelerated payments.

     In October, the Company began a new program to hedge its servicing 
portfolio against risk

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associated with future decreases in interest rates. This program has now been 
aggressively augmented, and includes a system of daily monitoring of servicing 
assets. Colonial Mortgage Company remains one of the lowest cost servicers in 
the industry with over $16 billion in mortgages serviced.

     Other one-time charges anticipated in the quarter include:

     -    a $10 million increase in the loan loss provision warranted by the
          Company's significant increase in loans and the overall level of loan
          loss reserves in light of concerns over the possibility of a general
          economic slowdown in 1999;

     -    $8.8 million in charges associated with recent acquisitions. These
          charges include legal and accounting fees, asset write-offs for
          duplicate and outdated equipment, severance payments, contract
          buyouts, systems conversion charges and other charges occasioned by
          the Company's aggressive acquisition program; and

     -    $2.0 million in Y2K expenses related to write-offs of noncompliant
          equipment.

     Over the last three years, the Company has completed twenty-five
acquisitions resulting in the establishment of operations in market areas in
Florida, Nevada, Georgia, and Texas that have experienced rapid growth in recent
years. Management has determined to consolidate and streamline operations and to
re-focus the Company's emphasis on profitable business units in 1999. In
connection with this decision, several steps have been taken or are under
consideration:

     -    reduction of redundant staff, which should result in the elimination
          of 220 positions and yield savings of annual salaries of approximately
          $6.0 million;

     -    closing of unprofitable branches;

     -    upgrade and relocation of certain branches; and

     -    sale of certain supermarket branches.
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     Restructuring costs associated with these initiatives and other
miscellaneous expenses will result in a one-time fourth quarter charge of
approximately $11.8 million. Management believes that these steps reflect a
strategic adjustment in the Company's business plan and represent an investment
in enhanced future profitability.

     In addition, as previously announced, the Company has encountered a delay
in realizing cost savings from certain Florida acquisitions, because its prior
item processor, Barnett Banks, was unable to complete the Company's conversion
schedule after Barnett's acquisition by NationsBank. As a result, the Company
anticipates establishing item and data processing capability in 1999 which will
eliminate these delays. Cost savings from these conversions are expected to
exceed $4 million annually.

     This document contains certain forward-looking statements relating to
present or future trends or factors generally affecting the banking industry and
specifically affecting the operations, markets and products of the Company.
Actual results could differ materially from those projected and may be affected
by changing events and trends that have influenced the Company's assumptions,
but that are beyond the control of the Company. These trends and events include
changes in the interest rate environment, expected cost savings from proposed
conversions, changes in the busines environment and securities markets and
changes in regulatory regimes affecting the Company. Additional information on
other factors that could affect the financial results of the Company is included
in the Company's filings with the Securities and Exchange Commission.


                                       
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                                  SIGNATURES




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

                                        THE COLONIAL BANCGROUP, INC.
                                        ----------------------------
                                                (Registrant)

Date:   December 21, 1998                /s/ W. Flake Oakley
                                        ----------------------------
                                              W. Flake Oakley
                                              Chief Financial Officer