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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 2004


COMMISSION FILE NUMBER   000-33021

GREER BANCSHARES INCORPORATED
(Exact Name of Registrant as Specified in Its Charter)

               South Carolina                                   57-1126200               
(State or Other Jurisdiction of Incorporation)     (I.R.S. Employer Identification Number)

1111 West Poinsett Street
P.O. Box 1029
Greer, SC 29650 		   

(864) 877-2000
(Address of Principal Executive OFfices)     (Issuer's Telephone Number)





Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes   X   No    

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).     Yes      No  X  

The number of outstanding shares of the issuer's $5.00 par value common stock as of April 30, 2004 was 2,428,406.

GREER BANCSHARES INCORPORATED
Index

PART 1        
        
FINANCIAL INFORMATION       
        
Item 1       
Consolidated Financial Statements (Unaudited)       

Consolidated Balance Sheets as of March 31, 2004 and December 31, 2003              3  
Consolidated Statements of Income for the Three Ended March 31, 2004 and 2003              4 
Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2004 and 2003               5 
Consolidated Statements of Changes in Stockholders’ Equity for the Three Months Ended March 31, 2004               6 
Consolidated Statements of Cash Flows for the Three Months ended March 31, 2004 and 2003              7 
Notes to Consolidated Financial Statements             8 
        
Item 2.       
Management's Discussion and Analysis of Financial Condition and Results of Operations              9 
        
Item 3.       
Quantitative and Qualitative Disclolsures About Market Risk      14-15 
        
Item 4.       
Controls and Procedures           15 
        
PART II       
        
OTHER INFORMATION 
        
Item 1.      Legal Proceedings           16 
Item 2.      Changes in Securities and Use of Proceeds           16 
Item 3.      Defaults Upon Senior Securities           16 
Item 4.      Submission of Matters to a Vote of Security Holders           16 
Item 5.      Other Information           16 
Item 6.      Exhibits and Report on 8-K           16 
        
Signatures           17 
        
Index to Exhibits           18 

2

GREER BANCSHARES INCORPORATED
Consolidated Balance Sheets
(Unaudited)

(dollars in thousands except per share data) March 31,
 December 31,
2004
 2003
Assets:            
Cash and Due from Banks   $ 10,743   $ 7,267  
Federal Funds Sold    7,100    159  
Investment Securities:  
  Held to maturity    26,436    17,263  
  Available for sale    58,667    66,760  
Net Loans    116,733    114,266  
Premises and Equipment, Net    3,821    3,886  
Real estate held for sale    735    125  
Other Assets    4,502    4,407  
Total Assets   $ 228,737   $ 214,133  
Liabilities:  
Deposits            
  Non-interest bearing   $ 21,630   $ 20,311  
  Interest bearing    142,018    132,650  
Total Deposits    163,648    152,961  
   
Note payable to Federal Home Loan Bank    42,037    40,057  
Other liabilities    2,069    1,408  
Total Liabilities    207,754    194,426  
   
Stockholders' Equity:  
Common stock--par value $5 per share, 10,000,000 shares            
authorized, 2,428,406 and 1,615,277 shares issued and            
outstanding at March 31, 2004 and December 31, 2003,            
respectively    12,142    8,076  
Additional paid in capital    2,490    6,465  
Retained Earnings    4,675    4,060  
Accumulated other comprehensive income    1,676    1,106  
Total Stockholders' Equity    20,983    19,707  
Total Liabilities and Stockholders' Equity   $ 228,737   $ 214,133  

The accompanying notes are an integral part of these consolidated financial statements.


3

GREER BANCSHARES INCORPORATED
Consolidated Statements of Income
(Unaudited)

(dollars in thousands, except per share data) For Three Months
03/31/04
 03/31/03
Interest Income:            
Loans (including fees)   $ 1,669   $ 1,818  
Investment Securities:            
     Taxable    447    370  
     Exempt from federal income tax    396    324  
Federal funds sold    5    9  
Other    22    30  
                     Total interest income    2,539    2,551  
   
Interest Expense:            
   Interest on deposit accounts    505    527  
   Interest on other borrowings    380    429  
                    Total interest expense    885    956  
   
                      Net interest income    1,654    1,595  
   
   Provision for loan losses    15    10  
      Net interest income after provision for loan losses    1,639    1,585  
   
Non-interest income:  
Service charges for deposit accounts    304    286  
Other service charges    61    62  
Gain on sale of investment securities    81    0  
Other non-interest income    144    112  
                   Total non-interest income    590    460  
   
Non-interest expenses:  
Salaries and employee benefits    836    757  
Occupancy and equipment    173    212  
Postage and supplies    54    57  
Other operating expenses    380    359  
                  Total non-interest expenses    1,443    1,385  
   
                  Income before income taxes    786    660  
   
Provision for income taxes:    166    139  
                          Net Income   $ 620   $ 521  
Basic net income per share of common stock   $ 0.26   $ 0.22  
Diluted net income per share of common stock   $ 0.25   $ 0.21  

The accompanying notes are an integral part of these consolidated financial statements.


4

GREER BANCSHARES INCORPORATED
Consolidated Statements of Comprehensive Income
(Unaudited)

For Three Months
03/31/04
 03/31/03
 
Net Income     $ 620   $ 521  
   
Other comprehensive          
income, net of tax:          
  Unrealized Holding Gains on            
  Investment Securities    620    360  
  Less Reclassification Adjustments for          
  (Gains)/Losses Included in Net Income    (50 )  0  
                 Subtotal    570    360  
Comprehensive Income   $ 1,190   $ 881  

The accompanying notes are an integral part of these consolidated financial statements.


5

GREER BANCSHARES INCORPORATED
Consolidated Statements of Changes in Stockholders’ Equity
For the Three Months Ended March 31, 2004 and Twelve Months Ended December 31, 2003
(Unaudited)

Additional Accumulated Total
(dollars in thousands, except per share data) Common Paid-In Retained Other Comp. Stockholders
Stock
 Capital
 Earnings
 Income
 Equity
Balances at 12/31/2002     $ 8,030   $ 6,350   $ 3,441   $ 792   $ 18,613  
   
Net Income            2,232        2,232  
Other Comprehensive Income, Net of Tax                      
  Unrealized Gains/(Losses) on                      
    investment portfolio                390    390  
  Less reclassification adjustments for                      
    (gains)/losses included in net income                (76 )  (76 )
Comprehensive Income                    2,546  
Stock exercised pursuant                      
  to stock option plan    46    97            143  
Tax benefit of stock options exercised        18            18  
Cash dividends ($1.00 per share)            (1,613 )      (1,613 )
Balances at 12/31/2003   $ 8,076   $ 6,465   $ 4,060   $ 1,106   $ 19,707  
   
Net Income            620        620  
Other Comprehensive Income, Net of Tax                      
  Unrealized Gains/(Losses) on                      
    investment portfolio                620    620  
  Less reclassification adjustments for                      
    (gains)/losses included in net income                (50 )  (50 )
Comprehensive Income