SUZANNA J. COSTELLO Vice President

1000 Peachtree Street, N.E. Atlanta, Georgia 30309-4470 404.498.7159 fax 404.498.7302 suzanna.costello@atl.frb.org

April 4, 2003

Floyd C. Davis, Sr.
Chairman of the Board
East Alabama Financial Group, Inc.
117 Main Street
Wedowee, Alabama 36278

Dear Mr. Davis:

We have reviewed the request by The Floyd C. Davis, Sr. Family Partnership L.P., Heflin, Alabama, (Notificant), for a determination that it is a qualified family partnership as defined in section 2(o)(10) of the Bank Holding Company Act (BHCA). Section 2(o)(10) of the BHCA requires that a qualified family partnership must meet the following conditions: (A) does not control any bank, except through a registered bank holding company; (B) does not control more than one registered bank holding company; (C) does not engage in any business activity, except indirectly through ownership of other business entities; (D) has no investments other than those permitted for a bank holding company pursuant to section 4(c) of the BHCA; (E) is not obligated on any debt, either directly or as a guarantor; and (F) has partners, all of whom are either (i) individuals related to each other by blood, marriage (including former marriage), or adoption; or (ii) trusts for the primary benefit of individuals related as described in clause (i).

In addition, any partnership requesting qualification as a qualified family partnership must file a statement with the Board of Governors of the Federal Reserve System that includes (i) the basis for eligibility of the partnership under subparagraph 2(o)(10)(F) of the BHCA; (ii) a list of the existing activities and investments of the partnership; (iii) a commitment to comply with section 2(o)(10) of the BHCA; (iv) a commitment to comply with section 7 of the Federal Deposit Insurance Act with respect to any acquisition of control of an insured depository institution occurring after the date of enactment of section 2(o)(10) of the BHCA; and (v) a commitment to be subject to the same extent as if the qualified family partnership were a bank holding company (i) to examination by the Board to assure compliance with section 2(o)(10) of the BHCA; and (ii) to section 8 of the Federal Deposit Insurance Act.

Notificant meets the criteria listed above and has provided the required information. The Reserve Bank has determined that the partnership is a qualified family partnership as defined by section 2(o)(10) of the BHCA, and therefore, is not a "company" within the meaning of the BHCA.

We have also completed our analysis of the after-the-fact notification filed by Notificant to retain 20.32 percent of the outstanding shares of East Alabama Financial Group, Inc., Wedowee, Alabama (East Alabama), pursuant to the Change in Bank Control Act of 1978. The Federal Reserve System has no objection to the transaction.

In consideration of this proposal, we have reviewed the financial and managerial factors, and based upon the information currently available, conclude that these factors are consistent with approval. The Federal Reserve System has relied on the representations and commitments made in the notification. The Reserve Bank's action is expressly conditioned upon compliance with these commitments and representations. For the purposes of this action, these commitments will be considered conditions imposed in writing and, as such, may be enforced in proceedings under applicable law. Every effort should be made to meet these representations and commitments since any deviation could be regarded as a violation of the terms upon which the System's action was premised. If, despite your best efforts, deviations seem likely, you should immediately notify this Reserve Bank. We would then be available to discuss the matter with you.

The Change in Bank Control Act of 1978 requires that whenever a change in control occurs, each insured bank or bank holding company shall report promptly to the appropriate Federal banking agency any changes or replacement of its chief executive officer or of any director occurring in the next 12-month period. The Act further requires a statement of the past and current business and professional affiliations of the new chief executive officer or directors.

Should you have any questions concerning this matter, please contact Tamika Cook of our staff at (404) 498-7240.

Very truly yours,

Suzanna J. Costello

cc:	Board of Governors Mr. William B. McCarty, Esquire The McCarty Law Practice, P.C. Federal Deposit Insurance Corporation - Atlanta Office Alabama State Banking Department Office of the Comptroller of the Currency - Atlanta Office Office of Thrift Supervision - Atlanta Office

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