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PART I - FINANCIAL INFORMATION
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Item 1. Financial Statements. (Continued)

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PART I - FINANCIAL INFORMATION
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Item 1. Financial Statements. (Continued)

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PART I - FINANCIAL INFORMATION
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Item 1. Financial Statements. (Continued)

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PART I - FINANCIAL INFORMATION
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Item 1. Financial Statements. (Continued)

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PART I - FINANCIAL INFORMATION
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Item 1. Financial Statements. (Continued)

     Note to Consolidated Financial Statements

Item 2.  Management's Discussion and Analysis of Financial Condition and Result of Operations.

       The following analysis should be read in conjunction with the financial statements set forth in Part I, Item 1, immediately preceding this section.
       Reference is made to the report of the registrant on Form 10-K for the year ended December 31, 2003, which report was filed with the Securities and Exchange Commission on or about March 30, 2004. This Form 10-Q contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 regarding, among other things, the anticipated financial and operating results of the registrant. The words "anticipate," "could," "may," "intend," "believe," and similar expressions are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The registrant undertakes no obligation to publicly release any modifications, updates or revisions of these statements to reflect event s or circumstances occurring after the day hereof, or to reflect the occurrence of unanticipated events.
       In connection with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the registrant cautions investors that future financial and operating results may differ materially from those projected in forward-looking statements made by, or on behalf of, the registrant. Such forward-looking statements involve known and unknown risks and uncertainties, including, but not limited to, increased competition with other financial institutions, lack of sustained growth in the registrant's market area, adverse changes in interest rates, inadequate allowance for loan loss, significant downturns in the businesses of one or more large customers, changes in the legislative or regulatory environment and loss of key personnel. These risks and uncertainties may cause the actual results or performance of the registrant to be materially different from any future results or performance expressed or implied by such forward-looking statements.

Critical Accounting Policies

       The accounting principles we follow and our methods of applying these principles conform to accounting principles generally accepted in the United States and with general practices within the banking industry. In connection with the application of those principles to the determination of our allowance for loan losses, we have made judgments and estimates that have significantly impacted our financial position and results of operations.

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PART I - FINANCIAL INFORMATION
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. (Continued)

       The allowance for loan losses is maintained at a level that is considered to be adequate to reflect estimated credit losses for specifically identified loans as well as estimated probable credit losses inherent in the remainder of the loan portfolio at the balance sheet date. The allowance is increased by the provision for loan losses, which is charged against current period operating results and decreased by the amount of charge-offs, net of recoveries. A formal review of the allowance for loan losses is prepared quarterly to assess the risk in the portfolio and to determine the adequacy of the allowance for loan losses. Our methodology of assessing the appropriateness of the allowance consists of several elements, which include the formula allowance, as well as specific allowances.
       The formula allowance is calculated by applying loss factors to outstanding loans and certain unused commitments. For purposes of the quarterly review, the loan portfolio is separated by loan type, and each type is treated as a homogeneous pool. Each loan is assigned a risk rating by loan officers using established credit policy guidelines. These risk ratings are periodically reviewed and all risk ratings are subject to review by an independent Credit Review Department. Each risk rating is assigned an allocation percentage which, when multiplied times the dollar value of loans in that risk category, results in the amount of the allowance for loan losses allocated to these loans. Allocation percentages are based on our historical loss experience and may be adjusted for significant factors that, in management's judgment, affect the collectibility of the portfolio as of the evaluation date.
       Specific allowances are established in cases where management has identified significant conditions or circumstances related to a credit that management believes indicates the probability that a loss has been incurred in excess of the amount determined by the application of the above formula. Every substandard or worse loan in excess of $25,000 and all loans criticized as "Special Mention" over $100,000 are reviewed quarterly by the Executive and Loan Committee of the registrant's bank subsidiary Board of Directors for the level of loan losses required to be specifically allocated.

OVERVIEW

       Total assets of the registrant grew approximately $13 million, or 3.2 percent in the first quarter of 2004. This growth was funded primarily by an increase in interest-bearing deposits. Much of the increase in assets was in federal funds sold since deposits increased more than loans in the first quarter of 2004. Management expects to use much of the increase in federal funds sold to increase securities available for sale and loans in the remaining months of 2004. Net income of the registrant increased approximately $190,000 in the first quarter of 2004 as compared to the first quarter of 2003. Much of this increase was due to an increase in security gains as well as a decrease in provision for loan losses during the first quarter of 2004 as compared to the first quarter of 2003. Salaries and employee benefits and income taxes both increased in the first quarter of 2004 as compared to the same period of 2003, offsetting some of the increase in security gains and the reduction in provision for loan losses.

       (a) Results of Operations

       Net income of the registrant was $1,394,265 for the first three months of 2004. This amounted to an increase of $190,120, or 15.8 percent, compared to the first three months of 2003.

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PART I - FINANCIAL INFORMATION
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. (Continued)

       Net interest income, the largest component of net income for the registrant, is the difference between income earned on loans and investments and interest paid on deposits and other sources of funds. Net interest income increased $35,659, or 0.9 percent during the first quarter of 2004 as compared to the first quarter of 2003.  Total interest income decreased $129,372, or 2.2 percent for the first three months of 2004 as compared to the first three months of 2003. The decrease in total interest income was primarily due to the lower interest rate environment that existed in the first quarter of 2004 as compared to the first quarter of 2003. However, the decrease in total interest income was offset by a decrease in total interest expense of $165,031, or 9.4 percent for the first quarter of 2004 as compared to the same period in 2003. The decrease in total interest expense was again primarily due to the lower interest rate environment that exist ed in the first quarter of 2004 as compared to the same period of 2003. The percentage change was greater for the total interest expense than the total interest income primarily due to the general decline in the level of interest rates that began in 2001 and continued through 2003 and the stagnation of low interest rates into the first quarter of 2004. The registrant was able to reprice its interest-bearing liabilities faster at the lower interest rates than its interest-earning assets.
       The decrease in interest income was due to a $236,962 decrease in interest and fee income on loans that was offset by a $111,740 increase in interest on investment securities. The decrease in interest and fee income on loans was due to lower interest rate environment in early 2004 as compared to early 2003 and by a decline in loans of approximately $5.5 million from March 31, 2003 to March 31, 2004. The decrease in interest expense was due to a $112,362 decrease in interest expense on savings and money market accounts and a $76,719 decrease in interest expense on time deposits that were partially offset by an increase of $9,776 in interest expense on NOW accounts and an increase of $14,274 in interest expense on borrowed funds for the first quarter of 2004 as compared to the same period of 2003. The net decrease in interest expense was primarily the result of the lower interest rate environment prevalent in the first quarter of 2004 as compared to the first quart er of 2003.  The increase in interest expense on NOW accounts was primarily due to an increase in NOW account balances. Also, the increase in interest expense on borrowed funds was due to an approximately $900,000 increase in borrowed funds from March 31, 2003 to March 31, 2004.
       Total other income increased $174,863, or 18.3 percent for the three-month period ended March 31, 2004, as compared to the three-month period ended March 31, 2003. The increase in other income was primarily a result of a $206,991 increase in security gains and a $21,912 increase in other service charges and fees for the first quarter of 2004 as compared to the first quarter of 2003. These increases were offset however, by decreases of $44,691 in mortgage banking fees and $22,163 in service charges on deposit accounts in the first quarter of 2004 as compared to the first quarter of 2003. The decrease in mortgage banking fees was primarily a result of decrease in refinancing activity in the first three months of 2004 as compared to the same period of 2003.
       The registrant's non-interest income is composed of several components, some of which vary significantly between quarterly periods. Service charges on deposit accounts and other non-interest income generally reflect the registrant's growth, while fees for origination of mortgage loans will often reflect stock and home mortgage market conditions and fluctuate more widely from period to period.
       Total other expenses increased $232,529, or 7.9 percent for the three months ended March 31, 2004 as compared to the three months ended March 31, 2003. Salaries and employee benefits increased $141,411, or 8.5 percent for the first quarter of 2004 as compared to the first quarter of 2003, primarily due to increased average salary and benefits expense per employee. Occupancy expenses also increased $17,478 in the first quarter of 2004 as compared to the same period of 2003 primarily due to increased repairs and maintenance expenses. In addition, the advertising and public relations expense increased $21,279 due to

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PART I - FINANCIAL INFORMATION
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. (Continued)

(b) Financial Condition

       The registrant's total assets increased 3.2 percent to $431,788,196 during the three months ended March 31, 2004, from $418,427,656 at December 31, 2003. Loans and leases, net of allowance for credit losses, totaled $226,329,461 at March 31, 2004, a 0.7 percent increase compared to $224,854,692 at December 31, 2003. Investment securities decreased $4,522,563, or 2.8 percent, to $155,384,155 at March 31, 2004, from $159,906,718 at December 31, 2003. The unrealized gain on securities, net of tax, was $2,414,241 at March

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PART I - FINANCIAL INFORMATION
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. (Continued)

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PART I - FINANCIAL INFORMATION
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. (Continued)

registrant arise by collateral type in relation to loans and credit commitments. The only significant concentration that exists is in loans secured by real estate and agricultural related loans.  Among the loans secured by real estate, the registrant has a concentration of loans secured by hotel and motel properties.  Although the registrant has a loan portfolio diversified by type of risk, the ability of its customers to honor their contracts is to some extent dependent upon their regional economic condition. A geographic concentration arises because the registrant grants commercial, real estate and consumer loans primarily to customers in Giles, Marshall and Lincoln Counties, Tennessee. In order to mitigate the impact of credit risk, management strives to identify loans experiencing difficulty early enough to correct the problems and to maintain an allowance for loan losses at a level management believes is sufficient to cover inherent losses in the loan portfolio.
       Net charge-offs for the three months ended March 31, 2004 were $439,452 for a net charge-off to total loans ratio of 0.77 percent (annualized). This compares to net charge-offs of approximately $1,083,800 for the three months ended March 31, 2003 for a net charge-off to total loans ratio of 1.87 percent (annualized). As discussed previously, one large line was responsible for much of the net loan charge-offs during the first quarter of 2004. Also, during the first quarter of 2003, a large credit line consisting primarily of commercial real estate and land development loans incurred substantial charge-offs and resulted in most of the net charged-off loans during the first three months of 2003.
       The total allowance for credit losses decreased to $3,062,026 as of March 31, 2004 from $3,448,676 as of December 31, 2003. The decrease of $386,650 in the allowance for credit losses during the first quarter of 2004 was primarily due to the charging off of the unguaranteed portion of the large USDA guaranteed credit mentioned previously. As of December 31, 2003, management had estimated the credit exposure on this line in its calculation for the allowance for credit losses. Subsequently, during the first quarter of 2004, the estimated loss on the credit was charged-off, thus decreasing the allowance for credit losses. Management believes that the allowance for credit losses is sufficient to cover potential losses in the loan portfolio.

(c) Liquidity

       Liquidity is the ability to fund increases in loan demand or to compensate for decreases in deposits and other sources of funds, or both. Maintenance of adequate liquidity is an essential component of the financial planning process. The objective of asset/liability management is to provide an optimum balance of liquidity and earnings. The registrant seeks to generate adequate cash flows to meet its needs without sacrificing income or taking undue risks. Cash and cash equivalents increased $17,302,882 between December 31, 2003 and March 31, 2004.  This increase was primarily the result of deposits increasing faster than loans and the resulting increase in federal funds sold.
       Marketable investment securities, particularly those of short maturities, are the principal source of asset liquidity. Securities maturing in one year or less amounted to $19,644,183 at March 31, 2004, representing 12.6 percent of the registrant's investment portfolio as compared to 13.8 percent one year earlier. These securities may be sold in response to changes in interest rates, changes in prepayment risk, the need to increase regulatory capital, or asset/liability strategy. Management classifies the registrant's entire investment portfolio in the available-for-sale category and reports these securities at fair value. Management does not anticipate the sale of a material amount of investment securities in the foreseeable future.
       Other sources of liquidity include maturing loans and federal funds sold. As mentioned previously, federal funds sold increased by $17,995,000 from December 31, 2003 to March 31, 2004.

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PART I - FINANCIAL INFORMATION
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. (Continued)

Off Balance Sheet Arrangements

       The registrant has not historically incurred off-balance sheet obligations through the use of or investment in off-balance sheet derivative financial instruments of structured finance or special purpose entities organized as corporations, partnerships or limited liability companies or trusts. However, the Bank 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. The following table summarizes the Bank's involvement in financial instruments with off-balance sheet risk:

       Since these commitments generally have fixed expiration dates and many will expire without being drawn upon, the total commitment level does not necessarily represent future cash requirements. If needed to fund these commitments, the registrant's subsidiary bank has the ability to liquidate federal funds sold or securities available-for-sale, or on a short-term basis to borrow and purchase federal funds from other financial institutions.
       The registrant's bank subsidiary originates residential mortgage loans for sale in the secondary market which it may be required to repurchase if a default occurs with respect to the payment of any of the first four installments of principal and interest after a loan is sold and the default continues for a period of 90 days. These loans are considered in the computation of the allowance for loan losses to cover future defaults.

(d) Capital Adequacy

       The Federal Reserve Board, the Office of the Comptroller of the Currency and the FDIC have established risk-based capital guidelines for U.S. banking organizations. These guidelines provide a uniform capital framework that is sensitive to differences in risk profiles among banks.   Under these guidelines, total capital consists of Tier I capital (core capital, primarily stockholders' equity) and Tier II capital (supplementary capital, including certain qualifying debt instruments and credit loss reserve).
       Assets are assigned risk weights ranging from 0 to 100 percent depending on the level of credit risk normally associated with such assets. Off-balance sheet items (such as commitments to make loans) are also included in assets through the use of conversion factors established by regulators and are assigned risk weights in the same manner as on-balance sheet items. Banking institutions are expected to maintain a Tier I capital to risk-weighted assets ratio of at least 4.00 percent, a total capital (Tier I plus Tier II) to total risk-weighted assets ratio of at least 8.00 percent, and a Tier I capital to total assets ratio (leverage ratio) of at least 4.00 percent.

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PART I - FINANCIAL INFORMATION
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. (Continued)

       The following table sets out the appropriate regulatory standards as well as the actual ratios for First Pulaski National Corporation ("FPNC") and First National Bank of Pulaski ("FNB") as of March 31, 2004 and December 31, 2003.

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PART I - FINANCIAL INFORMATION
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Item 3. Quantitative and Qualitative Disclosures About Market Risks.

       The registrant's primary component of market risk is interest rate volatility. Fluctuations in interest rates will ultimately impact both the level of income and expense recorded on a large portion of the registrant's assets and liabilities, and the market value of all interest-earning assets and interest-bearing liabilities, other than those which possess a short term to maturity. Based upon the nature of the registrant's operations, the registrant is not subject to foreign currency exchange or commodity price risk.
       Interest rate risk management focuses on the earnings risk associated with changing interest rates, as well as the risk to the present value of the registrant's equity. Management seeks to maintain profitability in both immediate and long-term earnings through funds management and interest rate risk management. The registrant's rate sensitive position has an important impact on earnings and the present value of the registrant's equity. Management of the registrant meets regularly to analyze the rate sensitivity position, focusing on the spread between the cost of funds and interest yields generated primarily through loans and investments. Management also seeks to maintain stability in the net interest margin under varying interest rate environment. These goals are accomplished through the development and implementation of lending, funding and pricing strategies designed to maximize net interest income under varying interest rate environments subject to specific liquidity and interest rate risk guidelines.
       Analysis of rate sensitivity and rate gap analysis are the primary tools used to assess the direction and magnitude of changes in net interest income resulting from changes in interest rates. Included in the analysis are cash flows and maturities of financial instruments, changes in market conditions, and pricing and deposit volume and mix. Since these assumptions are inherently uncertain, net interest income can not be precisely estimated nor can the impact changes in interest rates be precisely predicted. Actual results will differ due to timing, magnitude and frequency of interest rate changes and changes in market conditions and management's strategies, among other factors.
       There have been no material changes in reported market risks during the three months ended March 31, 2004.

Item 4. Controls and Procedures

       The Company maintains disclosure controls and procedures, as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934 (the "Exchange Act"), that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to its management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. The Company carried out an evaluation, under the supervision and with the participation of its management, including its Chief Executive Officer and its Chief Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures as of the end of the period covered by this report. Based on the evaluation of these disclosure controls and procedures, the Chief Executive Officer and the Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective.

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PART II - OTHER INFORMATION
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Item 1.  Legal Proceedings.

       The registrant and its subsidiaries are involved, from time to time, in ordinary routine litigation incidental to the banking business. Neither the registrant nor its subsidiaries is involved in any material pending legal proceedings.

Item 2.  Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities

     None

Item 3.  Defaults upon Senior Securities

     None

Item 4.  Submission of Matters to a Vote of Security Holders

     None

Item 5.  Other Information

     None

Item 6.  Exhibits and Reports on Form 8-K.

     (a)  Exhibit 31.1  Certification of Mark A. Hayes, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
           Exhibit 31.2  Certification of Tracy Porterfield, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
           Exhibit 32.1  Certification of Mark A. Hayes, pursuant to 18 U.S.C. Section 1350 - the Sarbanes-Oxley
                               Act of 2002.
           Exhibit 32.2  Certification of Tracy Porterfield, pursuant to 18 U.S.C. Section 1350 - the Sarbanes-Oxley
                               Act of 2002.

(b)  No current reports on Form 8-K have been filed during the first quarter of 2004.

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SIGNATURES

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      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 thereunto duly authorized.

                                                                                FIRST PULASKI NATIONAL CORPORATION

Date:  May 17, 2004                                                /s/Mark A. Hayes                                                         
                                                                                Mark A. Hayes, Chief Executive Officer

Date:  May 17, 2004                                                 /s/Tracy Porterfield                                     
                                                                                 Tracy Porterfield, Chief Financial Officer                    

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