8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8 – K

CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) October 27, 2010

PEOPLES FINANCIAL CORPORATION

(Exact Name of Registrant as Specified in its Charter)

Mississippi

(State or Other Jurisdiction of Incorporation)

01-12103	64-0709834
(Commission File Number)	(IRS Employer Identification No.)
152 Lameuse Street Biloxi, MS	39530
(Address of Principal Executive Offices)	(Zip Code)

(228) 435-5511

(Registrant’s Telephone Number, Including Area Code)

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously Satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2 below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230. 425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act ( 17CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4( c) under the Exchange Act (17 CFR 240.13e-4( c))

Item 2.02. Results of Operations and Financial Condition

On October 27, 2010 Peoples Financial Corporation issued a press release announcing its earnings for the first nine months of 2010.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1 Press Release issued by Peoples Financial Corporation dated October 27, 2010, headed “Peoples Financial Corporation Net Income Totals $364,000 for Third Quarter, $2,682,000 for Nine Months of 2010.”

SIGNATURES

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

Dated: October 27, 2010

PEOPLES FINANCIAL CORPORATION
By:	/s/ Chevis C. Swetman
	Chevis C. Swetman
	Chairman, President and CEO

EX-99.1

Exhibit 99.1: Peoples Financial Corporation Press Release Dated October 27, 2010

FOR IMMEDIATE RELEASE

For more information, contact:
Investor Relations
228-435-8208
investorrelations@thepeoples.com

PEOPLES FINANCIAL CORPORATION NET INCOME TOTALS
$364,000 FOR THIRD QUARTER, $2,682,000 FOR NINE MONTHS OF 2010

BILOXI, MS (October 27, 2010)—Third quarter net income of Peoples Financial Corporation (NASDAQ Capital Market: PFBX), parent of The Peoples Bank, totaled $364,000 or $.07 per average weighted share, announced Chevis C. Swetman, chairman and chief executive officer of the holding company and the bank.

Net income for the first nine months of 2010 totaled $2,682,000, a decrease of 7% from the same period in 2009.

Earnings per share for the first nine months of 2010 totaled $.52 per average weighted share, compared to $.56 per share in the same period last year. Earnings per share figures are based on weighted average shares outstanding of 5,151,697 as of September 30, 2010 and 5,176,744 as of September 30, 2009.

“Our bank generated profit of nearly $1.5 million in the second quarter of this year, but a combination of factors caused business activity and our income to fall sharply this past quarter,” said Swetman. “Net interest income for the quarter fell to the lowest levels since 2004, due to historically low interest rates and a near 10% decline in loan demand from the same period last year,” he said.

“During this period of slack economy and loan demand, our Board of Directors and senior management team have concentrated our efforts to further strengthen our already solid balance sheet,” said Swetman. “As of the end of the third quarter, our primary capital ratio stands at 13.74%, the highest since 2005,” he added.

Founded in 1896, with $819 million in assets as of September 30, 2010, The Peoples Bank operates 16 branches along the Mississippi Gulf Coast in Hancock, Harrison, Jackson and Stone counties. In addition to a comprehensive range of retail and commercial banking services, the bank also operates a trust and investment services department that has provided customers with financial, estate and retirement planning services since 1936.

The Peoples Bank is a wholly-owned subsidiary of Peoples Financial Corporation, listed on the NASDAQ Capital Market under the symbol PFBX. Additional information is available on the Internet at www.thepeoples.com.

This news release contains forward-looking statements and reflects industry conditions, company performance and financial results. These forward-looking statements are subject to a number of risk factors and uncertainties which could cause the Company’s actual results and experience to differ from the anticipated results and expectation expressed in such forward-looking statements.

PEOPLES FINANCIAL CORPORATION (In thousands, except weighted average shares and per share figures) (unaudited)

EARNINGS SUMMARY

	Three Months Ended September 30,					Nine Months Ended September 30,
	2010			2009		2010		2009
Net interest income	$	5,730		$	7,019	$	19,279	$	19,862
Provision for loan losses		1,045			1,875		3,780		3,725
Non-interest income		2,213			2,595		8,031		7,384
Non-interest expense		6,931			6,670		20,548		20,308
Income taxes		(397	)		95		300		335
Net income		364			974		2,682		2,878
Earnings per share		.07			.19		.52		.56

TRANSACTIONS IN THE ALLOWANCE FOR LOAN LOSSES

	Three Months Ended September 30,						Nine Months Ended September 30,
	2010			2009			2010			2009
Allowance for loan losses, beginning	$	9,168		$	9,798		$	7,828		$	11,114
Recoveries		91			5			165			335
Charge-offs		(1,308	)		(3,571	)		(2,777	)		(7,067	)
Provision for loan losses		1,045			1,875			3,780			3,725
Allowance for loan losses, ending	$	8,996		$	8,107		$	8,996		$	8,107

ASSET QUALITY

	September 30,
	2010			2009
Allowance for loan losses as a percentage of loans		2.13	%		1.74	%
Loans past due 90 days and still accruing	$	3,159		$	1,304
Nonaccrual loans		22,127			25,257

PERFORMANCE RATIOS (annualized)

	September 30,
	2010			2009
Return on average assets		.42	%		.43	%
Return on average equity		3.38	%		3.61	%
Net interest margin		3.44	%		3.28	%
Efficiency ratio		87	%		86	%
Primary capital		13.74	%		12.61	%

BALANCE SHEET SUMMARY

	September 30,
	2010		2009
Total assets	$	819,437	$	888,482
Loans		422,162		466,022
Securities		313,043		347,033
Other real estate (ORE)		2,819		2,745
Total deposits		532,916		541,567
Total federal funds purchased		142,381		188,483
Shareholders’ equity		108,142		105,654
Book value per share		20.99		20.51
Weighted average shares		5,151,697		5,176,744