SecProbe.io

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Via Facsimile and U.S. Mail
Mail Stop 6010
								August 24, 2005

Mr. David S. Perry
President
Yadkin Valley Company
P.O. Box 18747
Raleigh, NC  27619

Re:	Yadkin Valley Company
	Form 10-KSB for Fiscal Year Ended December 31, 2004
	Forms 10-QSB for Fiscal Quarters Ended
March 31, 2005 and June 30, 2005
	File No. 0-28356

Dear Mr. Perry:

      We have limited our review of your filings to those issues
we
have addressed in our comments.  Where indicated, we think you
should
revise your documents in response to these comments.  If you
disagree, we will consider your explanation as to why our comment
is
inapplicable or a revision is unnecessary.  Please be as detailed
as
necessary in your explanation.  In some of our comments, we ask
you
to provide us with more information so we may better understand
your
disclosure.

	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your
filings.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.

Form 10-KSB for the year ended December 31, 2004

Exhibit 13 - 2004 Annual Report to Shareholders

Management`s Discussion and Analysis of Financial Condition and
Results of Operations, page 4
1. You indicate in Note 1 to your financial statements that your
most
significant estimate is your determination of life policy claims
reserve.  Please revise your disclosure to include a discussion of
your critical accounting estimates as outlined in Financial
Reporting
Release No 72. Please address the following items related to the
risks and uncertainties in your determination of assumed life
policy
claims reserves:
a. The dollar amount of reserves, at the balance sheet date,
recorded
based on information received from the cedant and the nature and
extent of the information received from the cedant related to
policies, claims, unearned premiums and loss reserves;
b. Quantified and narrative disclosure of the impact that
reasonably
likely changes in your estimate of the reserves would have on
reported results, financial position and liquidity.
c. Because IBNR reserve estimates are more imprecise, the amount
of
IBNR separately from case reserves.
d. The dollar amount that you are exposed to losses underlying
contracts in force at the end of the balance sheet date;
e. The time lag from when claims are reported to the cedant to
when
the cedant reports them to you and whether, how and to what extent
this time lag effects your loss reserve estimate;
f. What process management performs to determine the accuracy and
completeness of the information received from the cedant;
g. How management uses the information received from the cedant in
its determination of its assumed loss reserves, and whether
reinsurance intermediaries are used to transact and service
reinsurance policies and how that impacts your loss reserving
methodology; and,
h. Whether management uses historical loss information to validate
its existing reserves and/or as a means of noticing unusual trends
in
the information received from the cedant.

Consolidated Financial Statements, page 8

Notes to Consolidated Financial Statements, page 14

Note 2:  Investments, page 18
2. Please refer to your disclosure that investments classified as
other are carried at the lower of cost or market.  It appears that
these investments are marketable equity securities that do not
have
readily determinable fair values as defined by SFAS 115.
Paragraph
46 of SFAS 60, as amended, requires this type of investment to be
reported at fair value.  Please revise your 2004 Form 10-KSB and
2005
Forms 10-QSB to report these investments at fair value or tell us
how
you comply with GAAP.  In addition, disclose the methodology used
to
determine the fair value of these securities and the likelihood
that
materially different amounts would be reported under different
conditions. Include investments in your critical accounting
estimates
disclosure in MD&A.

Note 4: Shareholders` Equity and Restrictions (Unaudited), page 18
3. The disclosures in this note are required by paragraph 60h of
SFAS
60 and should be audited.  Please revise your Form 10-KSB to
remove
the unaudited designation or tell us why this note is unaudited.

      As appropriate, please amend your Form 10-KSB for the year
ended December 31, 2004 and Forms 10-QSB for the quarters ended
March
31, 2005 and June 30, 2005 and respond to these comments within 10
business days or tell us when you will respond.  You may wish to
provide us with marked copies of the amendments to expedite our
review.  Please furnish a cover letter with your amendments that
keys
your responses to our comments and provides any requested
information.  Detailed cover letters greatly facilitate our
review.
Please file the letter on EDGAR under the form type label CORRESP.
Please understand that we may have additional comments after
reviewing your responses to our comments.

	 We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment decision.  Since the
company and its management are in possession of all facts relating
to
a company`s disclosure, they are responsible for the accuracy and
adequacy of the disclosures they have made.

	In connection with responding to our comments, please
provide,
in your letter, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;

* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

      In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.

	If you have any questions, please contact Mark Brunhofer,
Staff
Accountant, at (202) 551-3638 or Donald Abbott, Senior Staff
Accountant, at (202) 551-3608.  In this regard, do not hesitate to
contact me, at (202) 551-3679.

Sincerely,

Jim B. Rosenberg
Senior Assistant Chief Accountant
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Mr. David S. Perry
Yadkin Valley Company
August 24, 2005
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