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U.S. SECURITIES AND EXCHANGE COMMISSION

FORM 10-K

     Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

TIB FINANCIAL CORP.

(305) 451-4660
(Registrant’s telephone number)

Securities Registered pursuant to Section 12(b) of the Act: None
Securities Registered pursuant to Section 12(g) of the Act: Common stock, par value $0.10

Check whether the issuer (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 issuer was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.                           Yes [X] or  No[ ]

Check if there is no disclosure of delinquent filers pursuant to Item 405 of Regulation S-K contained in this form, and will not be contained, to the best of issuer’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  [  ]

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

The aggregate market value of the voting stock held by non-affiliates of the registrant at March 3, 2003 was $49,821,794 based on $15.26 per share as of March 3, 2003.

The number of shares outstanding of issuer’s class of common stock at March 3, 2003 was 4,038,925 shares of common stock.

Documents Incorporated By Reference: Portions of the Proxy Statement for the 2003 Annual Meeting of Shareholders to be filed with the Securities and Exchange Commission within 120 days of the Registrant’s 2002 fiscal year end are incorporated by reference into Part III of this report.

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CAUTIONARY NOTICE REGARDING FORWARD LOOKING STATEMENTS

Certain of the matters discussed under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Annual Report on Form 10-K may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act and as such may involve known and unknown risk, uncertainties and other factors which may cause the actual results, performance or achievements of TIB Financial Corp. (the “Company”) to be materially different from future results described in such forward-looking statements. Actual results may differ materially from the results anticipated in these forward looking statements due to a variety of factors, including, without limitation: the effects of future economic conditions; governmental monetary and fiscal policies, as well as legislative and regulatory changes; the risks of changes in interest rates on the level and composition of deposits, loan demand, and the values of loan collateral, and interest rate risks; the effects of competition from other commercial banks, thrifts, consumer finance companies, and other financial institutions operating in the Company’s market area and elsewhere. All forward looking statements attributable to the Company are expressly qualified in their entirety by these cautionary statements. The Company disclaims any intent or obligation to update these forward-looking statements, whether as a result of new information, future events or otherwise.

PART I

As used in this document, the terms “we,” “us,” “our,” “TIB Financial,” and “Company” mean TIB Financial Corp. and its subsidiaries (unless the context indicates another meaning), and the term “Bank” means TIB Bank of the Keys and its subsidiaries (unless the context indicates another meaning).

ITEM 1.     BUSINESS

TIB Financial Corp., Key Largo, Florida, was incorporated as a Florida business corporation in February 1996, for the purpose of becoming a bank holding company by acquiring all of the common stock of TIB Bank of the Keys (the “Bank”), Key Largo, Florida. Following the receipt of approval from the Board of Governors of the Federal Reserve System (the “Federal Reserve”), the Company became a bank holding company within the meaning of the Bank Holding Company Act of 1956 (the “Act”) upon the acquisition of all of the Common Stock of the Bank on August 31, 1996. Effective August 31, 2000, the Company became a financial holding company.

We are authorized to engage in any activity permitted by law to a Florida corporation, subject to applicable Federal regulatory restrictions on the activities of financial holding companies.

The Bank was incorporated under the laws of the State of Florida on December 28, 1973, for the purpose of conducting the business of commercial banking. The Bank commenced commercial banking operations on February 1, 1974. The deposits at the Bank are insured up to applicable limits by the Federal Deposit Insurance Corporation (the “FDIC”).

The Bank conducts a general commercial banking business in its primary service area of Monroe, Miami-Dade, Collier and Lee counties, Florida, emphasizing the banking needs of individuals, professionals and business customers. The main office of the Company and the Bank is located at 99451 Overseas Highway, Key Largo, Florida 33037. The Bank has a total of fourteen branch locations. There are nine branch locations throughout the Florida Keys from Key Largo to Key West. There are also two branch locations in Homestead, two branches in Naples, and one branch in Bonita Springs, Florida.

The principal business of the Bank is to attract deposits from the public and to use such deposits to make real estate, business and consumer loans in its primary service area. As of December 31, 2002, the Bank had total assets of approximately $564.2 million, total deposits of approximately $488.1 million and total shareholders’ equity of approximately $49.0 million.

The Bank offers a full range of deposit services that are typically available from financial institutions, including NOW accounts, money market checking accounts, demand accounts, savings accounts, certificates of deposit and other time

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deposits. In addition, retirement accounts such as Individual Retirement Accounts are available from the Bank. The Bank pays interest on its deposit accounts and certificates competitive with other financial institutions in its primary service area.

The Bank seeks to concentrate its deposits and loan efforts within Monroe, Collier, Lee, and Miami-Dade Counties, Florida, its primary service area. The primary factors in competing for deposits are interest rates, the range of financial services offered, service, convenience of office locations and flexible office hours. Direct competition for such deposits comes from other commercial banks, savings institutions, credit unions, brokerage firms and money market funds.

The Bank’s lending philosophy is to make loans, taking into consideration the safety of the Bank’s depositors’ funds, the preservation of the Bank’s liquidity, the interest of our shareholders, the welfare of the community, and other factors. Interest income from the Bank’s lending operations is a principal component of the Bank’s income, therefore prudent lending is essential for the prosperity of the Bank.

The primary factors in competing for loans are interest rates, loan origination fees and the range of lending services offered. Competition for origination of loans normally comes from other commercial banks, savings institutions, credit unions and mortgage banking firms. Such entities may have competitive advantages as a result of greater resources and higher lending limits (by virtue of their greater capitalization). There are also smaller financial institutions that compete for the same market. The Bank seeks to attract customers with its products and services which are tailored to the needs of the customers. Management seeks to emphasize a high degree of personalized client service in order to be able to better meet the banking needs of its customers.

The Bank’s loan portfolio at December 31, 2002 contained approximately 79% real estate mortgage loans, 11% commercial loans, 2% consumer loans, 4% indirect auto dealer loans, and 4% home equity loans. The Bank’s gross loan to deposit ratio at December 31, 2002, was approximately 90%.

In addition to interest income from the Bank’s lending operations, the other major sources of income for the Bank are fees on mortgage loans sold, interest on investment securities, service charges on deposit accounts, gains on sales of government guaranteed loans, and merchant bankcard processing income. The principal expenses of the Bank are interest paid on deposits, employee compensation, office expenses, and other overhead expenses.

The Bank engages through a wholly-owned subsidiary, TIB Investment Center, Inc. (“TIB Investment”), in the retail sale of nondeposit investment products such as variable and fixed rate annuities, mutual funds and other products. The Bank has entered into an agreement with Raymond James Financial Services, Inc., a third-party provider which trains and supervises employees of the Bank or TIB Investment in the sale of these products from various offices of the Bank.

The Bank also engages through a wholly-owned subsidiary, TIB Government Loan Specialists, Inc., in the origination and sale of the government guaranteed portion of loans that qualify for government guaranteed loan programs such as those offered by the Small Business Administration and the U.S. Department of Agriculture Rural Development Business and Industry Program.

Prior to December 31, 2001, we had a 30% interest in ERAS JV, a company that specializes in cash item processing for depository institutions and customized software for the financial services industry. On December 31, 2001, we sold a portion of our investment in this company, which reduced our ownership percentage in ERAS JV to 10%. On October 4, 2002, we sold 5.1% of our 10% interest in ERAS JV. This sale, accompanied by the additional transfer of assets by other owners into the venture, reduced our ownership in the venture to 4.53%.

In October 2000, we purchased Keys Insurance Agency of Monroe County, Inc. Keys Insurance Agency, Inc. (the new name subsequent to the purchase) has three offices in the Florida Keys and one office in Naples and brokers a full line of commercial and residential hazard insurance coverages as well as life and health insurance and annuities.

The Bank’s business plan relies principally upon local advertising and promotional activity and upon personal contacts by its directors, officers and shareholders to attract business and to acquaint potential customers with the Bank’s personalized services. The Bank emphasizes a high degree of personalized client service in order to be able to provide for each

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customer’s banking needs. The Bank’s marketing approach emphasizes the advantages of dealing with an independent, locally-managed and state chartered bank to meet the particular needs of consumers, professionals and business customers in the community. All banking services are continually evaluated with regard to their profitability and efforts are made to modify the Bank’s business plan if deemed appropriate.

In 2002, the Bank began a program of buying loans that have been originated by automobile dealerships. This is commonly referred to as indirect lending. We predominately buy loans from auto dealers in southwest Florida and they are for the purchase of new or late model used cars. We serve customers over a broad range of creditworthiness and the required terms and rates are reflective of those risk profiles.

Employees

As of December 31, 2002, the Bank employed 230 full-time employees and 15 part-time employees, and the insurance agency employed 23 full-time employees and one part-time employee. Except for certain officers of the Bank who presently serve as officers of the Company, the Company does not have any employees. The Company and its subsidiaries are not a party to any collective bargaining agreement, and management believes the Company and its subsidiaries enjoy satisfactory relations with its employees.

Supervision and Regulation

Regulation of the Bank: The operations of the Bank are subject to state and federal statutes applicable to state chartered banks whose deposits are insured by the FDIC, and also to the regulations of the Florida Department of Financial Services (the “DBF”) and the FDIC. Such statutes and regulations relate to, among other things, reserves, investments, loans, mergers and consolidations, branching, issuances of securities, payment of dividends, payment of interest rates, establishment of branches and other aspects of the Bank’s operations. Under the provisions of the Federal Reserve Act, the Bank is subject to certain restrictions on any extensions of credit to the Company or, with certain exceptions, other affiliates, and on the taking of such stock or securities as collateral on loans to any borrower. In addition, the Bank is prohibited from engaging in certain tie-in arrangements in connection with any extension of credit or the providing of any property or service. Florida law permits banks to branch on a statewide basis. Therefore, the Bank has the ability to expand from its market presence in Monroe, Miami-Dade, Collier and Lee counties into other markets in Florida.

The FDIC has adopted risk-based capital guidelines for all FDIC insured state chartered banks that are not members of the Federal Reserve System. These guidelines require all banks to maintain a minimum ratio of total capital to risk weighted assets of 8 percent (of which at least 4 percent must consist of Tier 1 capital). Tier 1 capital of state chartered banks (as defined in regulations) generally consists of (i) common stockholders equity; (ii) noncumulative perpetual preferred stock and related surplus; and (iii) minority interests in the equity accounts of consolidated subsidiaries.

In addition, the FDIC adopted a minimum ratio of Tier 1 capital to total assets of banks. This capital measure is generally referred to as the leverage capital ratio. The FDIC has established a minimum leverage capital ratio of 4 percent if the FDIC determines that the institution is not anticipating or experiencing significant growth and has well-diversified risk, including no undue interest rate exposure, excellent asset quality, high liquidity, good earnings and, in general, is considered a strong banking organization, rated Composite 1 under the Uniform Financial Institutions Rating System. Other financial institutions are expected to maintain leverage capital at least 100 to 200 basis points above the minimum level.

At December 31, 2002, the Bank exceeded these minimum Tier 1, risk-based and leverage capital ratios. The table that follows sets forth certain capital information for the Bank as of December 31, 2002.

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Capital Adequacy
(Dollars in thousands)
December 31, 2002

(1)  Represents the highest regular minimum requirement calculated by multiplying the minimum required percentage by the actual average total assets for leverage capital purposes. Institutions that are contemplating acquisitions or anticipating or experiencing significant growth may be required to maintain a substantially higher leverage ratio. See below regarding the consequences of failing to meet specified capital standards.

The Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) contains “prompt corrective action” provisions which established among other things, the following five capital standard categories for depository institutions: (i) well capitalized, (ii) adequately capitalized, (iii) undercapitalized, (iv) significantly undercapitalized and (v) critically undercapitalized. FDICIA imposes progressively more restrictive constraints on operations, management and capital distributions depending on the category in which an institution is classified. Each of the federal banking agencies has issued uniform regulations, which, among other things, define the capital levels described above. Under the regulations, a bank is considered “well capitalized” if it (i) has a total risk-based capital ratio of 10% or greater, (ii) has a Tier 1 risk-based capital ratio of 6% or greater, (iii) has a leverage ratio of 5% or greater, and (iv) is not subject to any order or written directive to meet and maintain a specific capital level for any capital measure. An “adequately capitalized” bank is defined as one that has (i) a total risk-based capital ratio of 8% or greater, (ii) a Tier 1 risk-based capital ratio of 4% or greater and (iii) a leverage ratio of 4% or greater. An “undercapitalized” bank is defined as one that has a total risk-based capital ratio of less than 8%, (ii) a Tier I risk-based capital ratio of less than 4% or (iii) a leverage ratio of less than 3%. A “significantly undercapitalized” bank is defined as one that has a total risk-based capital ratio of less than 6%, a Tier 1 risk-based capital ratio of less than 3% or a leverage ratio of less than 3% and a bank is “critically undercapitalized” if the bank has a leverage ratio equal to or less than 2%. The applicable federal regulatory agency for a bank that is “well capitalized” may reclassify it as “adequately capitalized” or “undercapitalized” and subject the institution to the supervisory actions applicable to the next lower capital category, if it determines that the Bank is in an unsafe or unsound condition or deems the bank to be engaged in an unsafe or unsound practice and not to have corrected the deficiency. As of December 31, 2002, the Bank met the definition of a “well capitalized” institution.

“Undercapitalized” depository institutions, among other things, are subject to growth limitations, are prohibited, with certain exceptions, from making capital distributions, are limited in their ability to obtain funding from a Federal Reserve Bank and are required to submit a capital restoration plan. The federal banking agencies may not accept a capital plan without determining, among other things, that the plan is based on realistic assumptions and is likely to succeed in restoring the depository institution’s capital. In addition, for a capital restoration plan to be acceptable, the depository institution’s parent holding company must guarantee that the institution will comply with such capital restoration plan and provide appropriate assurances of performance. If a depository institution fails to submit an acceptable plan, including if

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the holding company refuses or is unable to make the guarantee described in the previous sentence, it is treated as if it is “significantly undercapitalized”. Failure to submit or implement an acceptable capital plan also is grounds for the appointment of a conservator or a receiver. “Significantly undercapitalized” depository institutions may be subject to a number of additional requirements and restrictions such as orders to sell sufficient voting stock to become adequately capitalized, requirements to reduce total assets, and cessation of receipt of deposits from correspondent banks. “Critically undercapitalized” institutions, among other things, are prohibited from making any payments of principal and interest on subordinated debt, and are subject to the appointment of a receiver or conservator.

The Bank is also subject to, among other things, the provisions of the Equal Credit Opportunity Act (the “ECOA”) and the Fair Housing Act (the “FHA”), both of which prohibit discrimination based on race or color, religion, national origin, sex, and familial status in any aspect of a consumer or commercial credit or residential real estate transaction. The Department of Housing and Urban Development, the Department of Justice (the “DOJ”), and all of the federal banking agencies have issued an Interagency Policy Statement on discrimination in Lending which provides guidance to financial institutions as to what the agencies consider in determining whether discrimination exists, how the agencies will respond to lending discrimination, and what steps lenders might take to prevent discriminatory lending practices.

Regulation of the Company: The Company is a bank holding company within the meaning of the Act. As a bank holding company, we are required to file with the Federal Reserve an annual report and such additional information as the Board may require pursuant to the Act. The Federal Reserve may also make examinations of us and each of our subsidiaries. Bank holding companies are required by the Act to obtain approval from the Federal Reserve prior to acquiring, directly or indirectly, ownership or control of more than 5% of the voting shares of a bank or merging with another bank holding company.

Legislation has significantly increased the right of an eligible bank holding company, called a “financial holding company,” to engage in a full range of financial activities, including insurance and securities activities, as well as merchant banking and other financial services. On August 31, 2000, the Federal Reserve Bank approved our election to become a financial holding company. We thus have expanded financial affiliation opportunities as long as the Bank remains a “well-capitalized” and “well-managed” depository institution and has at least a “satisfactory” rating under the Community Reinvestment Act of 1997 (the “CRA”). As of December 31, 2002, the Bank met all three criteria for the Company’s continued qualification as a financial holding company.

As a bank holding company, we are subject to capital adequacy guidelines established for bank holding companies by the Federal Reserve. The minimum required ratio for total capital to risk weighted assets is 8 percent (of which at least 4 percent must consist of Tier 1 capital). Tier 1 capital (as defined in regulations of the Federal Reserve) consists of common and qualifying preferred stock and minority interests in equity accounts of consolidated subsidiaries, less goodwill and other intangible assets required to be deducted under the Federal Reserve’s guidelines. The Federal Reserve’s guidelines apply on a consolidated basis to bank holding companies, like ours, with total consolidated assets of $150 million or more. For bank holding companies with less than $150 million in total consolidated assets, the guidelines apply on a bank only basis, unless the bank holding company is engaged in nonbanking activity involving significant leverage or has significant amount of debt outstanding that is held by the general public. The Federal Reserve has stated that risk based capital guidelines establish minimum standards and that bank holding companies generally are expected to operate well above the minimum standards.

The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (the “Interstate Banking Act”), subject to certain restrictions, allows adequately capitalized and managed bank holding companies to acquire existing banks across state lines, regardless of state statutes that would prohibit acquisitions by out-of-state institutions. Further, a bank holding company may consolidate interstate bank subsidiaries into branches and a bank may merge with an unaffiliated bank across state lines to the extent that the applicable states authorize such transactions. The Interstate Banking Act generally prohibits an interstate acquisition (other than the initial entry into a state by a bank holding company) that would result in either the control of more than (i) 10% of the total amount of insured deposits in the United States, or (ii) 30% of the total insured deposits in the home state of the target bank, unless such 30% limitation is waived by the home state on a basis which does not discriminate against out-of-state institutions. As a result of this legislation, we may become a candidate for acquisition by, or may ourselves seek to acquire, banking organizations located in other states.

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Florida has enacted the Florida Interstate Branching Act (the “Florida Branching Act”), which permits interstate branching through merger transactions under the Interstate Banking Act. Under the Florida Branching Act, with the prior approval of the DBF, a Florida bank may establish, maintain and operate one or more branches in a state other than the State of Florida pursuant to a merger transaction in which the Florida bank is the resulting bank. In addition, the Florida Branching Act provides that one or more Florida banks may enter into a merger transaction with one or more out-of-state banks, and an out-of-state bank resulting from such transaction may maintain and operate the branches of the Florida bank that participated in such merger. An out-of-state bank, however, is not permitted to acquire a Florida bank in a merger transaction unless the Florida bank has been in existence and continuously operated for more than three years.

Federal Reserve policy requires a bank holding company to act as a source of financial strength and to take measures to preserve and protect bank subsidiaries in situations where additional investments in a troubled bank may not otherwise be warranted. In addition, under the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (“FIRREA”), where a bank holding company has more than one bank or thrift subsidiary, each of the bank holding company’s subsidiary depository institutions is responsible for any losses to the FDIC as a result of an affiliated depository institution’s failure. As a result, a bank holding company may be required to loan money to its subsidiaries in the form of capital notes or other instruments which qualify as capital under regulatory rules. However, any loans from the holding company to such subsidiary banks likely will be unsecured and subordinated to such bank’s depositors and perhaps to other creditors of the bank. In addition, a bank holding company may be required to provide additional capital to any additional banks it acquires as a condition to obtaining the approvals and consents of regulatory authorities in connection with such acquisitions.

The Company and the Bank are subject to Section 23A of the Federal Reserve Act, which limits a bank’s “covered transactions” (generally, any extension of credit or purchase of assets) with any single affiliate to no more than 10% of a bank’s capital and surplus. Covered transactions with all affiliates combined are limited to no more than 20% of a bank’s capital and surplus. All covered and exempt transactions between a bank and its affiliates must be on terms and conditions consistent with safe and sound banking practices, and a bank and its subsidiaries are prohibited from purchasing low quality assets from the bank’s affiliates. Finally, Section 23A requires that all of a bank’s extensions of credit to an affiliate be appropriately secured by collateral. The Company and the Bank are also subject to Section 23B of the Federal Reserve Act, which further limits transactions among affiliates. The Federal Reserve Act and implementing regulations also prohibit extensions of credit by a state non-member bank (such as the Bank) to its directors, executive officers and controlling shareholders on terms which are more favorable than those afforded other borrowers, and impose limits on the amounts of loans to individual affiliates and all affiliates as a group.

The Company and the Bank are subject to the provisions of the CRA and the federal banking agencies’ regulations issued thereunder. Under the CRA, all banks and thrifts have a continuing and affirmative obligation, consistent with its safe and sound operation to help meet the credit needs for their entire communities, including low- and moderate-income neighborhoods. The CRA does not establish specific lending requirements or programs for financial institutions, nor does it limit an institution’s discretion to develop the types of products and services that it believes are best suited to its particular community, consistent with the CRA. The CRA requires a depository institution’s primary federal regulator, in connection with its examination of the institution, to assess the institution’s record of assessing and meeting the credit needs of the community served by that institution, including low- and moderate-income neighborhoods. The regulatory agency’s assessment of the institution’s record is made available to the public. In the case of a bank holding company applying for approval to acquire a bank or other bank holding company, or a bank applying for a merger or a branch office, the regulatory agencies will take into account the CRA rating of each subsidiary depository institution of the applicant bank holding company, and such records may be the basis for denying the application. Generally, holding companies and banks are required to have CRA ratings of satisfactory or better for purposes of approval of such applications. As a result of the Bank’s most recent CRA examination in May 2001, the Bank received a “satisfactory” CRA rating.

Enacted in 1999, the Gramm-Leach-Bliley Act reforms and modernizes certain areas of financial services regulation. As discussed above, the law permits the creation of new financial services holding companies that can offer a full range of financial products under a regulatory structure based on the principle of functional regulation. The legislation eliminates the legal barriers to affiliations among banks and securities firms, insurance companies, and other financial services

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companies. The law also provides financial organizations with the opportunity to structure these new financial affiliations through a holding company structure or a financial subsidiary. The law reserves the role of the Federal Reserve Board as the supervisor for bank holding companies. At the same time, the law also provides a system of functional regulation which is designed to utilize the various existing federal and state regulatory bodies. The law also sets up a process for coordination between the Federal Reserve Board and the Secretary of the Treasury regarding the approval of new financial activities for both bank holding companies and national bank financial subsidiaries.

The law also includes a minimum federal standard of financial privacy. Financial institutions are required to have written privacy policies that must be disclosed to customers. The disclosure of a financial institution’s privacy policy must take place at the time a customer relationship is established and not less than annually during the continuation of the relationship. The act also provides for the functional regulation of bank securities activities. The law provides for transitional repeals of the exemption that banks were afforded from the definition of “broker,” and replaces it with a set of limited exemptions that allow the continuation of some historical activities performed by banks. In addition, the act amends the securities laws to include banks within the general definition of dealer. Regarding new bank products, the law provides a procedure for handling products sold by banks that have securities elements. In the area of CRA activities, the law generally requires that financial institutions address the credit needs of low-to-moderate income individuals and neighborhoods in the communities in which they operate. Bank regulators are required to take the CRA ratings of a bank or of the bank subsidiaries of a holding company into account when acting upon certain branch and bank merger and acquisition applications filed by the institution. Under the law, financial holding companies and banks that desire to engage in new financial activities are required to have satisfactory or better CRA ratings when they commence the new activity.

Once a bank holding company has filed a declaration of its intent to be a financial holding company, as long as there is no action by the Federal Reserve Board giving notice that it is not eligible, the company may proceed to engage in the activities and enter into the affiliations under an expanded authority conferred by the law. The holding company does not need prior approval from the Federal Reserve Board to engage in activities that the law identifies as financial in nature or that the Federal Reserve Board has determined to be financial in nature or incidental thereto by order or regulation. The law retains the basic structure of the Bank Holding Company Act. Thus, a bank holding company that is not eligible for the expanded powers of a financial holding company, is subject to the provisions of the Bank Holding Company Act which limits the activities that are authorized and defined as closely related to banking activities. The law also addresses the consequences of when a financial holding company that has exercised the expanded authority fails to maintain its eligibility to be a financial holding company. The Federal Reserve Board may impose such limitations on the conduct or activities of a noncompliant financial holding company or any affiliate of that company as the Board determines to be appropriate under the circumstances and consistent with the purposes of the law.

The United States Congress and the Florida Legislature periodically consider and adopt legislation that results in, and could further result in, deregulation, among other matters, of banks and other financial institutions. Such legislation could modify or eliminate current prohibitions with other financial institutions, including mutual funds, securities brokerage firms, insurance companies, banks from other states and investment banking firms. The effect of any such legislation on the business of the Company or the Bank cannot be accurately predicted. The Company cannot predict what legislation might be enacted or what other implementing regulations might be adopted, and if enacted or adopted, the effect thereof.

Competition

The banking business is highly competitive. The Bank competes with other commercial banks that conduct operations in its primary service area.

Banks generally compete with other financial institutions through the banking products and services offered, the pricing of services, the level of service provided, the convenience and availability of services, and the degree of expertise and the personal manner in which services are offered. The Bank encounters strong competition from most of the financial institutions in the Bank’s primary service area. In the conduct of certain areas of its banking business, the Bank also competes with credit unions, consumer finance companies, insurance companies, money market mutual funds and other financial institutions, some of which are not subject to the same degree of regulation and restrictions imposed upon the Bank. Many of these competitors have substantially greater resources and lending limits than the Bank has and offer

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certain services, such as trust services, that the Bank does not provide presently. Management believes that personalized service and competitive pricing will provide it with a method to compete effectively in the primary service area.

Monetary Policy

Our earnings are affected by domestic and foreign economic conditions, particularly by the monetary and fiscal policies of the United States government and its agencies. The Federal Reserve has an important impact on the operating results of banks and other financial institutions through its power to implement national monetary policy. The methods used by the Federal Reserve include setting the reserve requirements of banks, establishing the discount rate on bank borrowings and conducting open market transactions in United States Government securities.

FDIC Insurance Assessments

The FDIC has adopted a risk-based assessment system for insured depository institutions that takes into account the risks attributable to different categories and concentrations of assets and liabilities. The system assigns an institution to one of three capital categories: (a) well capitalized, (b) adequately capitalized, and (c) undercapitalized. These three categories are substantially similar to the prompt corrective action categories described above, with the “undercapitalized” category including institutions that are undercapitalized, significantly undercapitalized, and critically undercapitalized for prompt corrective action purposes. An institution is also assigned by the FDIC to one of three supervisory subgroups within each capital group. The supervisory subgroup to which an institution is assigned is based on a supervisory evaluation provided to the FDIC by the institution’s primary federal regulator and information which the FDIC determines to be relevant to the institution’s financial condition and the risk posed to the deposit insurance funds (which may include, if applicable, information provided by the institution’s state supervisor). An institution’s insurance assessment rate is then determined based on the capital category and supervisory category to which it is assigned.

The FDIC may terminate insurance of deposits upon a finding that the institution has engaged in unsafe and unsound practices, is in an unsafe or unsound condition to continue operations, or has violated any applicable law, regulation, rule, order, or condition imposed by the FDIC.

Based on the Bank’s risk classification, the Bank was not required to pay an assessment for deposit insurance in 2002, nor will it be required to pay a deposit insurance assessment in 2003. The Bank was required to pay the special interim Bank Insurance Fund Financing Corporation (“FICO”) assessments in 2002 and will also be required to pay this assessment in 2003.

Statistical Information

Certain statistical information is found in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations of this Annual Report on Form 10-K.

ITEM 2.     PROPERTIES

We conduct our business operations through the principal executive and operations office of the Company and the Bank located on an approximately 1.3 acre site at 99451 Overseas Highway, Key Largo, Monroe County, Florida. The main offices of the Bank at 99451 Overseas Highway are housed in a two-story building, owned by the Bank and containing approximately 13,275 square feet of finished space used for offices and operations and seven teller windows in the Bank lobby. The building also has two drive-up teller windows and an automated teller machine with 24-hour a day access.

The Bank’s other thirteen branches are located at 600 North Homestead Boulevard in Homestead, 777 North Krome Avenue in Homestead, 103330 Overseas Highway in Key Largo, 91980 Overseas Highway in Tavernier, 80900 Overseas Highway in Islamorada, 11401 Overseas Highway in Marathon Shores, 2348 Overseas Highway in Marathon, 30400 Overseas Highway in Big Pine Key, 330 Whitehead Street in Key West, 3618 N. Roosevelt Drive in Key West, 8100

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Health Center Boulevard in Bonita Springs, 599 Ninth Street North in Naples, and 1720 J & C Boulevard in Naples, Florida. The main office and branch properties are owned by the Bank, with the exception of the 8100 Health Center Boulevard and 1720 J & C Boulevard locations which are leased. The Bank owns the first floor of the building located at 599 Ninth Street North, but does not own the land.

The Bank also owns three other properties. The Bank owns a one-story building containing approximately 5,000 square feet on a one-half acre lot located at 100210 Overseas Highway, Key Largo. This building is partly leased to Keys Insurance Agency and the remainder of the building is used by the Bank as a training center and office space. The Bank owns a three-story building at 228 Atlantic Boulevard, Key Largo, Florida that is utilized by the Bank primarily for its loan operations and human resources departments. The Bank owns a building located at 28 N.E. 18^th Street in Homestead that is used for office space.

The Bank leases office space at 9915 Tamiami Trail North in Naples, and at 1119 US 27 South in Sebring, Florida for the Bank’s residential lending operations. Office space is also leased at 5800 Overseas Highway in Marathon, Florida for its commercial lending department.

The insurance agency leases its four locations located at 100210 Overseas Highway in Key Largo, 5800 Overseas Highway in Marathon, 805 Peacock Plaza in Key West, and 8100 Health Center Boulevard in Bonita Springs. The Key Largo and Bonita Springs locations are leased from the Bank.

ITEM 3.      LEGAL PROCEEDINGS

While the Company and the Bank are from time to time parties to various legal proceedings arising in the ordinary course of their business, management believes after consultation with legal counsel that there are no proceedings threatened or pending against the Company or the Bank that will, individually or in the aggregate, have a material adverse effect on the consolidated results of operations or financial condition of the Company.

ITEM 4.      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matter was submitted to a vote of security holders during the Company’s fourth quarter of the fiscal year ended December 31, 2002.

PART II

ITEM 5.     MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Our common stock trades on the Nasdaq National Market under the symbol “TIBB.” As of December 31, 2002, there were 372 registered shareholders of record and 4,035,625 shares of our common stock outstanding. The following table sets forth, for the periods indicated, the high and low sale prices per share for our common stock on the Nasdaq National Market:

For the year ended December 31, 2002, we paid cash dividends to our shareholders in the amount of $.1075 per share for the first three quarters and $.11 per share for the last quarter ($.4325 in the aggregate). For the year ended December 31, 2001, we paid cash dividends to our shareholders in the amount of $.1075 per share for each of the four quarters ($.43 in the aggregate).

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Our ability to continue to pay cash dividends to our shareholders is primarily dependent on the earnings of the Bank. Payment of dividends by the Bank to us is limited by dividend restrictions in capital requirements imposed by Bank regulators. Information regarding restrictions on the ability of the Bank to pay dividends to us is contained in Note 13 of the “Notes to Consolidated Financial Statements” contained in Item 8 hereof. In general, future dividend policy is subject to the discretion of the board of directors and will depend upon a number of factors, including the future earnings, capital requirements, regulatory constraints, and our financial condition as well as that of the Bank.

In the first quarter of 2000, we repurchased 5,000 shares of common stock at an average cost of $10.32. In July 2000, we repurchased 525,000 shares of common stock from our largest shareholder at a cost of $10 per share.

ITEM 6.     SELECTED FINANCIAL DATA

The selected consolidated financial data presented below as of and for the years ended December 31, 2002, 2001, 2000, 1999, and 1998 is unaudited and has been derived from our Consolidated Financial Statements and from our records. The information presented below should be read in conjunction with the Consolidated Financial Statements and related notes, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

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(1)  Averages are derived from daily balances.

Introduction

During 1996, TIB Financial Corp. was formed providing for a reorganization whereby TIB Bank of the Keys became our wholly-owned subsidiary. In 1997, the Bank formed two subsidiaries, the first on June 13, 1997, when the Bank acquired the assets of Small Business Consultants, Inc., a Florida corporation specializing in the government guaranteed loan consulting business. On July 31, 1997, the Bank formed TIB Investment & Insurance Center, Inc. for the purpose of selling investment products to the public. Effective January 14, 2002, the name of this subsidiary was changed to TIB Investment Center, Inc. Prior to December 31, 2001, we had a 30% interest in ERAS JV, a joint venture computer software, item processing, and network management company. We reduced our ownership percentage to 10% on December 31, 2001, though a partial sale of our ownership interest. On October 4, 2002, we sold 5.1% of our 10% interest in ERAS JV. This sale, accompanied by the additional transfer of assets by other owners into the venture, reduced our ownership in the venture to 4.53%. ERAS JV currently processes the cash items and provides computer software services for the Bank. In October 2000, we purchased Keys Insurance Agency of Monroe County, Inc. Keys Insurance Agency (the new name subsequent to the purchase), brokers a full line of commercial and residential hazard insurance coverages as well as life and health insurance and annuities.

During 2002, economic activity in our primary markets reflected the national trend of the economy as expanding but at a slow rate. This in turn saw the Federal Reserve keeping short term interest rates at low levels all year. Specifically, the target Federal Funds Rate began 2002 at 1.75% and remained there until November when it was decreased to 1.25%. The Prime lending rate continued its recent pattern of staying 300 basis points, 3%, above the Federal Funds Rate.

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These low rates pressure our net interest margins in two ways. First, clearly a low Prime rate directly affects yields on loans tied to that index and even loans not indexed to Prime are priced reflective of overall low asset yields. Second, deposit liabilities in many cases can only be priced down so far before it is simply too low to attract the volume of required funding. The net effect of this is asset yields generally decreasing faster, and to a greater extent, than liability costs.

We have been able to mitigate this effect in 2002 for the following reasons. First, even though we are at low relative levels of interest rates, the decline at least stabilized somewhat this year and we were able to decrease liability costs to a similar extent that asset yields contracted. Second, we had instituted a practice of requiring an interest rate floor on new commercial loans. This proved very useful in slowing the average declines in loan yields. Finally, we began to change the mix of assets to create slightly higher percentages of better yielding loans.

In furtherance of our efforts to generate higher relative yielding assets, the Bank began a program to acquire indirect automobile loans. After significant study, we began in April to put together a department that we feel could safely acquire and service this type of product. By the end of 2002, we were buying approximately $4 million per month of indirect automobile paper and as of December 31, 2002, we had approximately $16.9 million of indirect loans outstanding. With the appropriate safeguards, we feel this product offers us a compelling risk versus reward tradeoff especially in an overall low rate environment.

In other areas, the favorable rates for residential mortgages helped to contribute to another record year for us in residential loan production. Fees on these loans sold increased almost 50% to $1,583,000. Merchant bankcard processing revenue also increased from $4,010,000 in 2001 to $4,387,000 in 2002.

We opened one additional banking office in 2002. On November 25, 2002, we opened our headquarters office for Southwest Florida at 599 Ninth Street North in Naples, Florida. We own the first floor of a new three story office building near the downtown area. This investment was done as part of our general plan to expand our market share over time by de novo branching into growth markets. Even though new branches take about three years to break even, when they are profitable the accumulated losses that were incurred from the opening should be less than the premium the branch and its related assets and deposits might otherwise realize.

Performance Overview

We achieved net income of $4.7 million in 2002 representing an $840,932 or a 21.6% increase from the prior year.

Basic earnings per share for 2002 was $1.19 compared to $0.99 in 2001. Basic weighted-average common equivalent shares outstanding in 2002 were 3,992,775 compared to 3,923,763 in 2001. This increase resulted from exercise of stock options.

Diluted earnings per share for 2002 was $1.14 compared to $0.95 in 2001. Diluted weighted-average common equivalent shares outstanding in 2002 were 4,144,855 compared to 4,096,767 in 2001.

Total assets at December 31, 2002 were $567.0 million compared to $494.0 million at the previous year end, reflecting an increase of 14.8%. Asset growth was funded by an increase in deposits of 16.1%, or $66.9 million in 2002. Our total loan volume increased 16.5%, or $62.6 million, to $441.7 million at year end 2002 compared to $379.1 million at December 31, 2001. In 2002, we began originating indirect auto dealer loans. This accounted for $16.9 million of the increase in total loans in 2002.

Net interest income in 2002 increased 17.1%, or $3,066,979, to $21.0 million from $17.9 million reported in 2001. Our interest margin increased from 4.22% in 2001 to 4.39% in 2002. Non-performing assets decreased to 0.81% of total loans at December 31, 2002 from 1.16% at year end 2001.

Non-interest income increased $709,000 to $12.0 million in 2002. The increase in other income is attributed to an

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increase of $377,000 in merchant bankcard processing income; an increase of $15,000 in service charges on deposit accounts; a $167,000 increase in other income; a $509,000 increase in fees on mortgage loans sold; a $28,000 increase in commissions on retail investment services; a $343,000 increase in commissions on sales by Keys Insurance Agency, Inc.; a $268,000 increase from equity in income, net of goodwill amortization, and dividend income from our investment in ERAS Joint Venture; offset by a $68,000 decrease in gain on sale of government guaranteed loans; a $66,000 decrease in net security gains; a $255,000 decrease in gain on sale of servicing rights, and a $609,000 decrease in gain on sale of investment in ERAS Joint Venture.

We experienced an increase in non-interest expenses of $2.8 million in 2002, or 12.7 % over 2001. The increased expenses primarily related to the expansions costs associated with the entrance into the Southwest Florida market.

RESULTS OF OPERATIONS

The following table summarizes the balance sheet and results of operations including selected financial performance ratios for the three years ended December 31:

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(1)  Averages are derived from daily balances.

NET INTEREST INCOME

Net interest income, our primary source of revenue, is a function of the yield earned on average interest-earning assets and the rate paid on average interest-bearing liabilities. Changes in net interest income from period to period reflect the increases or decreases in average interest-earning assets, interest-bearing liabilities and the interest rate spread which is affected by the degree of mismatch in maturity and repricing characteristics of our interest-earning assets and interest-bearing liabilities.

2002 compared with 2001

The prime rate as published in the Wall Street Journal began 2002 at 4.75% where it remained until November when it declined to 4.25%. Many of the Bank’s loans are indexed to this floating rate. Offsetting this decline in interest income, we have been able to reprice maturing high-rate certificates of deposit and other funding sources resulting in a reduction in interest expense compared to the prior year. The average yield on interest earning assets declined 137 basis points in 2002 to 6.54% from 7.91% in 2001. The average cost of interest bearing deposits declined from 4.12% in 2001 to 2.30% in 2002 or 182 basis points and the rate of all interest-bearing liabilities decreased 181 basis points, from 4.38% in 2001 to 2.57% in 2002. Net interest margin increased from 4.22% in 2001 to 4.39% in 2002.

2001 compared with 2000

The prime rate as published in the Wall Street Journal began 2001 at 9.5% and by December it had declined to 4.75%. With many of the Bank’s loans indexed to this floating rate, this decrease in rate resulted in decreasing yields in the loan portfolio in 2001 which were not entirely matched by decreased funding costs. The average yield on interest earning assets declined 82 basis points in 2001 to 7.91% from 8.73% in 2000. The average cost of interest bearing deposits declined from 4.87% in 2000 to 4.12% in 2001 or 75 basis points and the rate of all interest-bearing liabilities decreased 63 basis points, from 5.01% in 2000 to 4.38% in 2001. Net interest margin decreased from 4.74% in 2000 to 4.22% in 2001.

The following table sets forth information with respect to the average balances, interest income and average yield by major categories of assets; the average balances, interest expense and average rate by major categories of liabilities; the average balances of noninterest-earning assets, noninterest-bearing liabilities and stockholders’ equity; and net interest income, interest rate spread, and net interest margin for the years ended December 31, 2002, 2001 and 2000.

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[Additional columns below]

[Continued from above table, first column(s) repeated]

AVERAGE BALANCE SHEETS
										2000
						AVERAGE				INCOME/				YIELDS
(Dollars in thousands)						BALANCES				EXPENSE				RATES
ASSETS
	Interest-earning assets:
		Loans (1)(2)				$	307,511			$	28,394				9.23	%
		Investment securities - taxable					49,494				3,015				6.09	%
		Investment securities - tax exempt (2)					6,380				486				7.61	%
		Interest bearing deposits in other banks					63				4				6.26	%
		Federal funds sold					7,275				456				6.27	%
Total interest-earning assets							370,723				32,355				8.73	%
Non-interest-earning assets:
	Cash and due from banks						12,948
	Investment in ERAS						995
	Premises and equipment, net						14,176
	Allowances for loan losses						(3,243	)
	Other assets						7,705
Total non-interest earning assets							32,581
Total assets						$	403,304
LIABILITIES & STOCKHOLDERS’ EQUITY
	Interest-bearing liabilities:
		Interest bearing deposits:
		NOW accounts				$	34,814				508				1.46	%
		Money market					112,519				5,957				5.29	%
		Savings deposits					22,719				524				2.31	%
		Other time deposits					116,107				6,938				5.98	%
Total interest-bearing deposits							286,159				13,927				4.87	%
	Other interest-bearing liabilities:
	Other borrowings						114				14				12.25	%
	Notes payable						2,639				350				13.25	%
	Short-term borrowings and FHLB advances						3,306				213				6.45	%
Trust preferred securities							2,536				272				10.71	%
Total interest-bearing liabilities							294,754				14,776				5.01	%
Non-interest bearing liabilities and stockholders’ equity:
	Demand deposits						76,089
	Other liabilities						5,298
	Stockholders’ equity						27,163
Total non-interest bearing liabilities and stockholders’ equity							108,550
Total liabilities and stockholders’ equity						$	403,304
Interest rate spread															3.72	%
Net interest income										$	17,579
Net interest margin (3)															4.74	%