U. S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549

FORM 10-Q

COMMISSION FILE NUMBER:       000-50224

SECURITY CAPITAL CORPORATION
FIRST QUARTER 2006 INTERIM FINANCIAL STATEMENTS

TABLE OF CONTENTS
    

SECURITY CAPITAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ITEM NO. 2  MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion contains "forward-looking statements" relating to, without limitation, future economic performance, plan and objectives of management for future operations, and projections of revenues and other financial items that are based on the beliefs of the Company's management, as well as assumptions made by and information currently available to the Company's management. The words "expect," "estimate," "anticipate," and "believe," as well as similar expressions, are intended to identify forward-looking statements. The Company's actual results may differ and the Company's operating performance each quarter is subject to various risks and uncertainties that are discussed in detail in the Company's filing of the Form 10Q with the Securities and Exchange Commission.

The subsidiary Bank represents the primary assets of the Company. On March 31, 2006, First Security Bank had approximately $442.8 million in assets compared to $419.0 million at March 31, 2005. Loans increased to $308.6 million at March 31, 2006 from $254.8 million at March 31, 2005. Deposits increased by $13.1 million from March 31, 2005 to March 31, 2006 for a total of $375.7 million. For the three months ended March 31, 2006 and March 31, 2005, the Bank reported income of approximately $1,828,000 and $1,677,000, respectively.

CHANGES IN FINANCIAL CONDITION
The cash and due from banks of $20.6 million at March 31, 2006 reflected an increase from the cash position of $19.7 million at December 31, 2005. This increase is attributed to a daily fluctuation due to normal bank transactions. The cash management team readily invests available cash and assesses the investment tools for the most desirable yield and the funding needs of the bank.

The earning assets at December 31, 2005 were $383.1 million and at March 31,2006 were $394.8 million. The investments in fixed assets continue to increase with the further expansion of the banking services into the Desoto County area and with the improvement of the banking location in Robinsonville. The premises and equipment, net of the accumulated depreciation, at December 31, 2005 was $18.7 million as compared to $19.4 million at March 31, 2006. Other assets increased to $7.8 million at March 31, 2006 from $7.0 million at December 31, 2005, with the major component of the increase attributed to an increase in the customer liability acceptances.

Deposit liabilities at March 31, 2006 reflected a 5.8% growth or a $20.8 million increase for the first three months in 2006. The rise in deposits decreases the need for increments on long-term borrowings. Short-term borrowings provide a tool in providing the funding for unforeseen deposit withdrawals and customer loan advances. At March 31, 2006, short-term funding of federal funds purchased and funds borrowed from the Federal Reserve was not required due to a significant rise in deposits.

The net unrealized loss on available-for-sale securities reflected in the shareholders' equity section on December 31, 2005 and on March 31, 2006 was $255 thousand and $340 thousand, respectively. The changes reflected over these reporting periods reflect the volatile nature of the market. The volatile nature of the market affected the comprehensive income with a net decrease of $85 thousand for the three months ending March 31, 2006 and a decrease of $477 thousand for the three months ending March 31, 2005.

The consolidated statements of cash flows summarize the changes in the financial condition of the Company. The most prevalent of the changes for the three months ending March 31, 2006 are: an increase of $7.7 million in loans; a net decrease in available-for-sale securities of $2.1 million resulting from purchases of $3.8 million offset by an approximate $5.9 million in maturities and sales; an increase in the investment in premises and equipment of $710 thousand; an increase of $20.8 million in deposits; an investment in federal funds sold of $1 million; and a decrease of $15 million in federal funds purchased.

NONPERFORMING ASSETS AND RISK ELEMENTS.
Diversification within the loan portfolio is an important means of reducing inherent lending risks. The loan portfolio is represented by the following mix: Commercial 5.78%; Agricultural 1.13%; Real Estate 83.90%; Consumer 9.47% and Other .68%. The major components of the real estate loans are 34.40% for construction and land development property, 21.60% for first liens on 1-4 family residential property and 35.98% for nonfarm and nonresidential property.

At March 31, 2006, the subsidiary bank had loans past due as follows:

The accrual of interest is discontinued on loans which become ninety days past due unless the loans are adequately secured and in the process of collection. Nonaccrual loans totaled $14 thousand at March 31, 2006. Any other real estate owned is carried at lower of cost or current appraised value less cost to dispose. Other real estate at March 31, 2006 totaled $510 thousand. A loan is classified as a restructured loan when the interest rate is materially reduced or the term is extended beyond the original maturity date because of the inability of the borrower to service the debt under the original terms. The subsidiary bank had no restructured loans at March 31, 2006.

For the three months ended March 31, 2006, the Company experienced $150 thousand in charge-offs of loans and $185 thousand in recoveries of loans for a net increase effect to the Allowance for Loan Losses of $35 thousand. With the recoveries exceeding the charge-offs for the three months, the net charge-offs represent 0% of loans. Of the $150 thousand charge to the Allowance for Loan Losses, the breakdown is 6.67% for commercial and industrial loans, .66% for credit card loans and 92.67% for consumer loans. Consumer loan collections of $179 thousand represent the major component of the $185 thousand in recoveries.

LIQUIDITY
The Company has an asset and liability management program that assists management in maintaining net interest margins during times of both rising and falling interest rates and in maintaining sufficient liquidity. For the period ending March 31, 2006, the liquidity improvement was reflected with the increase in deposits, the decrease of federal funds purchased and the purchase of federal funds sold. The regulatory liquidity ratio is well within the policy requirement of a minimum liquidity ratio of 15%. A 1% increase or decrease in market rates will basically not affect net interest income. The Company's policy allows for no more than a 10% movement in NII (net interest income), in a 200 basis point ramp of market rates over a one-year period. When funds exceed the needs for reserve requirements or short-term liquidity needs, the company will increase its security investments or sell federal funds. It is management's policy to maintain an adequate portion of its portfolio of assets and liabilities on a short-term basis to insure rate flexibility and to meet loan funding and liquidity needs.

At March 31, 2006, the tools to meet these needs are the secured and unsecured lines of credit with the correspondent banks totaling $37.5 million (to borrow federal funds) and the line of credit with the Federal Home Loan Bank that exceeded $118 million. At March 31, 2006, the Company had available (unused) line of credit of approximately $94million.

CAPITAL RESOURCES
Total consolidated equity capital at March 31, 2006 was $48.9 million or approximately 10.10% of total assets. The main source of capital for the Corporation has been the retention of net income.

Quantitative measures established by regulation to ensure capital adequacy require the Company to maintain minimum amounts and ratios of Total Capital, Tier 1 Capital and Leverage Capital. Currently, the Company and the Bank have adequate capital positions as of March 31, 2006 as reflected below:

RESULTS OF OPERATIONS
The consolidated net income for the Company for the three months ending March 31, 2006 was $1.8 million which reflected an increase of $155 thousand or 9.53% from the same period in 2005. The increase signifies the continued growth of the Company.

Interest income increased to $7.0 million for the three months ending March 31, 2006 indicating an increase of $1.7 million from the $5.3 million for the three months ending March 31, 2006. The increase in interest income signifies an increase in the pricing of the loan products. Other Income for the three months ending March 31, 2006 increased to $1.6 million from $1.5 million for the three months ending March 31, 2006. The net increase of $85 thousand is attributed to an increase in income on service charges on deposit accounts for the three months ending March 31, 2006.

Interest expense reflects an increase of $1.0 million to $2.3 million for the three months ending March 31, 2006 from $1.3 million for the same period in 2005. The increase in interest expense can be attributed to the competitive pricing of the deposit accounts in a rising rate market.

The increase in the provision for loan losses of $56 thousand reflects a proactive approach in the evaluation of the quality of the loan portfolio and is consistent with the increase in the loan portfolio and the quarterly analysis of the Allowance for Loan Losses.

Noninterest income for the three months ending March 31, 2006 was $1.6 million which is an increase from the $1.5 million for the same period in 2005, reflecting an increase of $98 thousand. The main component of the increase in the non-routine income in 2006 is attributable to service charges on deposit accounts. The service charges on deposit accounts, for each of the three months ended March 31, 2006 and March 31, 2005, totaled $1.1 million and $960 thousand, respectively.

Other expenses, consisting primarily of salaries, employee benefits and occupancy expense, for the three months ending March 31, 2006 reveal an increase of $389 thousand or 12.65% from the same period in 2005. Salaries and employee benefits of $2.3 million for the three months ended March 31, 2006 represent the largest component of other expenses and steadily increases with the development of the market area and the training of future bank management, in both areas of commercial banking and trust.

Income tax expense of $797 thousand for the three months ended March 31, 2006 is indicative of the applicable tax liability for the increase in the income for 2006 along with the adjustments for tax-exempt income.

The net interest margin for the three months ending March 31, 2006 is 4.32%. The return on equity for the three month period ending March 31, 2006 is 15.89%. For the three months ended March 31, 2006, the return on assets is reflected at 1.67%. These ratios, reflecting the financial status of the company, are consistent with the ratios for prior reporting periods.  

ITEM NO. 3 QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
There have been no material changes in market risk exposures that affect the quantitative and qualitative disclosures presented as of December 31, 2005 in the Company's Form 10-K and Annual Report.

ITEM NO. 4 CONTROLS AND PROCEDURES
Within 90 days prior to the filing of this report, an evaluation under the direction and with the participation of our principal executive officer and principal financial officer was performed to determine the effectiveness of the design and operation of the disclosure controls and procedures. The principal executive officer and the principal financial officer concluded that our disclosure controls and procedures are effective in timely alerting them to material information required to be included in our periodic SEC reports. There have been no significant changes in the Corporation's internal controls or in other factors subsequent to the date of the evaluation that could significantly affect these controls.
 

ITEM 1. LEGAL PROCEEDINGS
Out of the normal course of business, First Security Bank may be defendant in a lawsuit. In regard to any legal proceedings, which occurred during the reporting period, management expects no material impact on the Company's consolidated financial position or results of operation.

ITEM 2. CHANGES IN SECURITIES
None

ITEM 3. DEFAULT 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

SIGNATURES
    

SECURITY CAPITAL CORPORATION

Exhibit No. 31.1

Certificate pursuant to Rule 13a-14(a) or 15d-14(a) of Securities Exchange Act of 1934 as adopted pursuant to section 302 of Sarbanes-Oxley Act of 2002 – Chief Executive Officer.

I, Frank West certify that:

EXHIBIT 31.2

Certificate pursuant to Rule 13a-14(a) or 15d-14(a) of Securities Exchange Act of 1934 as adopted pursuant to section 302 of Sarbanes-Oxley Act of 2002 – Cashier and Chief Financial Officer.

I, Connie Woods Hawkins certify that:

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U. S. C., SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10Q, filed pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, of Security Capital Corporation (the "Company") for the period ended March 31, 2006, as filed with the Securities Exchange Commission on the date hereof (the "Report"), I, Frank West, the Chief Executive Officer of the Company, certify, pursuant to 18 U. S. C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Security Capital Corporation and will be retained by Security Capital Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

EXHIBIT 32.2

CERTIFICATION PURSUANT TO 18 U. S. C., SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002)

In connection with the Quarterly Report on Form 10Q, filed pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, of Security Capital Corporation (the "Company") for the period ended March 31, 2006, as filed with the Securities Exchange Commission on the date hereof (the "Report"), I, Connie Woods Hawkins, the Chief Financial Officer of the Company, certify, pursuant to 18 U. S. C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Security Capital Corporation and will be retained by Security Capital Corporation and furnished to the Securities and Exchange Commission or its staff  upon request.