SOURCE: Fulton Financial Corporation

October 16, 2007 17:11 ET

Fulton Financial Reports Third Quarter Earnings

LANCASTER, PA--(Marketwire - October 16, 2007) - Fulton Financial Corporation (NASDAQ: FULT) earned $33.6 million for the third quarter ended September 30, 2007, a 30.6 percent decrease from the same period in 2006. Diluted net income per share for the quarter decreased to 19 cents, a 32.1 percent decrease from the 28 cents reported in 2006. Diluted net income per share for the quarter decreased 17.4 percent from the 23 cents reported in the second quarter of 2007.

Net income was $114.5 million for the nine months ended September 30, 2007, a 17.6 percent decrease from the same period in 2006. Diluted net income per share for the first nine months of 2007 decreased to 66 cents, a 17.5 percent decrease from the 80 cents reported in 2006. Total assets at September 30, 2007 were approximately $15.4 billion.

During the third quarter, the Corporation recorded a $16.0 million charge related to mortgage banking operations at Resource Bank. The Corporation also recorded a gain of approximately $2.1 million ($1.8 million, net of related expenses) related to the resolution of litigation with another bank and the sale of certain assets, each related to the mortgage banking operations of Resource Bank. The $16.0 million charge included $9.9 million related to two specific situations where potential misrepresentation of borrower information exists, $3.6 million related to revaluations of repurchased loans and foreclosed real estate and $2.2 million related to outstanding repurchase requests. The majority of the loss is attributable to Resource Mortgage wholesale branch offices that have been closed or sold. Fulton Mortgage Company now oversees the operations of Resource Mortgage.

"We continue to deal with the impact of a slow-down in the housing market along with the Resource Mortgage issues," said R. Scott Smith, Jr., Chairman, Chief Executive Officer and President. "Management's attention is focused on resolving those issues and, based on our analysis, we believe the resulting reserves are adequate for these situations. Out of an abundance of caution, we are conducting a review of the records related to mortgages originated by Resource Mortgage. Based on market factors and the results of the review, it is possible that additional reserves may be required in the future."

"External factors impacting our earnings are the economy and the direction of interest rates," continued Smith. "Commercial loan growth was good. However, funding this growth with lower cost deposits remains a challenge as was evident in the reduction of our net interest margin. As anticipated, we are seeing tangible results from our expense reduction initiatives."

Loans, net of unearned income, increased $676.3 million, or 6.6 percent, to $11.0 billion at September 30, 2007, compared to $10.3 billion at September 30, 2006. The increase was primarily realized in commercial loans, which grew $382.8 million, or 13.0 percent, and commercial mortgages, which increased $233.1 million, or 7.3 percent. In comparison to the second quarter of 2007, loans, net of unearned income, increased $274.5 million, or 2.6 percent, which was mainly due to growth in commercial loans of $95.4 million, or 3.0 percent, an increase in commercial mortgages of $76.0 million, or 2.3 percent, and residential mortgages, which increased $77.2 million, or 10.5 percent.

Non-performing assets were $107.0 million, or 0.69 percent of total assets, at September 30, 2007, compared to $46.8 million, or 0.31 percent, at September 30, 2006 and $74.1 million, or 0.49 percent, at June 30, 2007. The $32.9 million, or 44.3 percent, increase in non-performing assets since June 30, 2007 was primarily due to the repurchase of residential mortgages from investors during the third quarter. As of September 30, 2007, the remaining outstanding balances of these repurchased loans classified as non-accrual loans and other real estate owned were approximately $21 million.

Annualized net charge-offs for the quarter ended September 30, 2007 were 0.08 percent of average total loans, compared to annualized net recoveries of 0.01 percent for the quarter ended September 30, 2006 and annualized net charge-offs of 0.14 percent for the quarter ended June 30, 2007. For the nine months ended September 30, 2007, annualized net charge-offs were 0.07 percent of average total loans, compared to 0.01 percent for the same period in 2006. The provision for loan losses increased $4.1 million for the third quarter of 2007, as compared to the same period in 2006.

Total deposits at September 30, 2007 of $10.3 billion were relatively unchanged from September 30, 2006. Time deposits increased $279.4 million, or 6.4 percent, offset by a $265.3 million, or 4.5 percent, decrease in demand and savings deposits. In comparison to the second quarter of 2007, total deposits decreased $27.1 million, or 0.3 percent, due to a $147.7 million, or 2.6 percent, decrease in demand and savings deposits, offset by a $120.7 million, or 2.7 percent, increase in time deposits.

Net interest income for the third quarter decreased $3.5 million, or 2.8 percent, compared to the third quarter of 2006 and increased $1.5 million, or 1.2 percent, from the second quarter of 2007. Fulton Financial's net interest margin was 3.62 percent for the third quarter of 2007, 3.85 percent for the third quarter of 2006 and 3.70 percent for second quarter of 2007. During the third quarter of 2006, $3.3 million of interest recoveries on loans added 10 basis points to net interest margin.

Other income, excluding investment securities losses and gains, increased $1.4 million, or 4.0 percent, in the third quarter of 2007 compared to the same period in 2006. The increase resulted primarily from a $1.8 million increase in other service charges and fees and the $2.1 million of gain from the sale of certain mortgage-related assets and the settlement of related lawsuits during the third quarter of 2007. These increases were offset by a decline in gains on sales of mortgage loans. Compared to the second quarter of 2007, other income, excluding security gains and losses, increased $501,000, or 1.4 percent, primarily due to the previously mentioned gain and lawsuit settlement, offset by decreases in gains on sales of mortgage loans and in investment management and trust services.

Other expenses increased $15.6 million, or 16.8 percent, compared to the third quarter of 2006, to $108.0 million. The increase was due to the additional $16.0 million of contingent losses related to the Corporation's mortgage banking activities at Resource Bank, offset by a $2.5 million reduction in salaries and employee benefits, due in part to corporate-wide workforce management and centralization initiatives which began during 2007. Compared to the second quarter of 2007, other expenses increased $9.9 million, or 10.1 percent.

Fulton Financial Corporation is a Lancaster, Pennsylvania-based financial holding company which operates more than 260 banking offices in Pennsylvania, Maryland, Delaware, New Jersey and Virginia through the following affiliates: Fulton Bank, Lancaster, PA; Swineford National Bank, Middleburg, PA; Lafayette Ambassador Bank, Easton, PA; FNB Bank, N.A., Danville, PA; Hagerstown Trust, Hagerstown, MD; Delaware National Bank, Georgetown, DE; The Bank, Woodbury, NJ; The Peoples Bank of Elkton, Elkton, MD; Skylands Community Bank, Hackettstown, NJ; Resource Bank, Virginia Beach, VA and The Columbia Bank, Columbia, MD.

The Corporation's financial services affiliates include Fulton Financial Advisors, N.A., Lancaster, PA; Fulton Insurance Services Group, Inc., Lancaster, PA; and Dearden, Maguire, Weaver and Barrett, LLC, West Conshohocken, PA.

Residential mortgage lending is offered by all banks through Fulton Mortgage Company or Resource Mortgage.

Additional information on Fulton Financial Corporation is available on the Internet at www.fult.com.

Safe Harbor Statement:

This news release may contain forward-looking statements with respect to our financial condition, results of operations and business. Forward-looking statements are encouraged by the Private Securities Litigation Reform Act of 1995. When words such as "believes," "expects," "anticipates" or similar expressions are used in this release, the Corporation is making forward-looking statements.

Such forward-looking statements reflect the Corporation's current views and expectations based largely on information currently available to its management, and on its current expectations, assumptions, plan, estimates, judgments, and projections about its business and its industry, and they involve inherent risks, contingencies, uncertainties and other factors. Although the Corporation believes that these forward-looking statements are based on reasonable estimates and assumptions, the Corporation is unable to provide any assurance that its expectations will, in fact, occur or that its estimates or assumptions will be correct and actual results could differ materially from those expressed or implied by such forward-looking statements and such statements are not guarantees of future performance. The Corporation undertakes no obligation to update or revise any forward-looking statements. Accordingly, investors and others are cautioned not to place undue reliance on such forward-looking statements.

Many factors could affect future financial results including, without limitation, acquisition and growth strategies, market risk, the effect of competition and interest rates on net interest margin and net interest income, investment strategy and income growth, investment securities gains, other-than-temporary impairment of investment securities, deposit and loan growth, asset quality, balances of risk-sensitive assets to risk-sensitive liabilities, employee benefits and other expenses, amortization of intangible assets, goodwill impairment, capital and liquidity strategies and other financial and business matters for future periods.

For a more complete discussion of certain risks and uncertainties affecting the Corporation, please see the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations -- Forward-Looking Statements" set forth in the Corporation's filings with the Securities and Exchange Commission.

FULTON FINANCIAL CORPORATION
FINANCIAL HIGHLIGHTS (UNAUDITED)
dollars in thousands, except per-share data


                                 September 30
                           -------------------------
BALANCE SHEET DATA             2007         2006     % Change
                           ------------ ------------  ------

Total assets               $ 15,438,177 $ 14,910,652    3.5%
Loans, net of unearned
 income                      10,988,307   10,312,057    6.6%
Investment securities         2,948,262    2,950,671   (0.1%)
Deposits                     10,291,186   10,277,028    0.1%
Shareholders' equity          1,554,120    1,497,693    3.8%


                     Quarter Ended              Nine Months Ended
                      September 30                 September 30
                  -------------------          -------------------
INCOME SUMMARY      2007      2006    % Change   2007      2006    % Change
                  --------- --------- -------- --------- --------- -------

Interest income   $ 238,740 $ 229,101    4.2%  $ 699,508 $ 634,959   10.2%
Interest expense   (116,330) (103,177)  12.7%   (334,415) (271,141)  23.3%
                  --------- ---------          --------- ---------
   Net interest
    income          122,410   125,924   (2.8%)   365,093   363,818    0.4%
Provision for loan
 losses              (4,606)     (555) 729.9%     (8,263)   (2,430) 240.0%
Investment
 securities
 (losses) gains        (134)    1,450 (109.2%)     2,277     5,524  (58.8%)
Other income         36,877    35,462    4.0%    110,536   103,997    6.3%
Other expenses     (107,996)  (92,425)  16.8%   (307,008) (271,234)  13.2%
                  --------- ---------          --------- ---------
   Income before
    income taxes     46,551    69,856  (33.4%)   162,635   199,675  (18.6%)
Income taxes        (12,985)  (21,514) (39.6%)   (48,096)  (60,753) (20.8%)
                  --------- ---------          --------- ---------
   Net income     $  33,566 $  48,342  (30.6%) $ 114,539 $ 138,922  (17.6%)
                  ========= =========          ========= =========

PER-SHARE DATA:

Net income:
   Basic          $    0.19 $    0.28  (32.1%) $    0.66 $    0.80  (17.5%)
   Diluted             0.19      0.28  (32.1%)      0.66      0.80  (17.5%)
   Cash dividends    0.1500    0.1475    1.7%      0.448     0.433    3.5%

Shareholders' equity   8.96      8.63    3.8%
Shareholders' equity
 (tangible)            5.17      4.82    7.3%

SELECTED FINANCIAL
 RATIOS:

Return on average
 assets                0.88%     1.31%              1.03%     1.32%
Return on average
 shareholders'
 equity                8.67%    13.26%             10.07%    13.04%
Return on average
 shareholders'
 equity (tangible)    15.76%    25.14%             18.42%    24.34%
Net interest
 margin                3.62%     3.85%              3.69%     3.88%
Efficiency ratio      65.17%    55.04%             61.97%    55.72%
Non-performing
 assets to total
 assets                0.69%     0.31%




FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED ENDING BALANCE SHEETS (UNAUDITED)
dollars in thousands

                                                            % Change from
                                                           ---------------
                    September 30 September 30   June 30   Sept 30  June 30
                        2007         2006         2007      2006    2007
                    ------------ ------------ ------------ ------- -------

ASSETS
  Cash and due from
   banks            $    337,306 $    338,598 $    381,714  (0.4%) (11.6%)
  Loans held for
   sale                  116,451      236,787      185,471 (50.8%) (37.2%)
  Other interest-earning
   assets                 19,673       35,884       14,367 (45.2%)  36.9%
  Investment
   securities          2,948,262    2,950,671    2,750,394  (0.1%)   7.2%
  Loans, net of
   unearned           10,988,307   10,312,057   10,713,819   6.6%    2.6%
  Allowance for loan
   losses               (109,435)    (107,422)    (106,892)  1.9%    2.4%
                    ------------ ------------ ------------
       Net Loans      10,878,872   10,204,635   10,606,927   6.6%    2.6%
  Premises and
   equipment             190,092      188,403      188,893   0.9%    0.6%
  Accrued interest
   receivable             73,927       70,901       71,785   4.3%    3.0%
  Goodwill and
   intangible assets     658,274      661,594      659,739  (0.5%)  (0.2%)
  Other assets           215,320      223,179      219,125  (3.5%)  (1.7%)
                    ------------ ------------ ------------
     Total Assets   $ 15,438,177 $ 14,910,652 $ 15,078,415   3.5%    2.4%
                    ============ ============ ============

LIABILITIES AND
 SHAREHOLDERS' EQUITY
  Deposits          $ 10,291,186 $ 10,277,028 $ 10,318,239   0.1%   (0.3%)
  Short-term
   borrowings          1,773,083    1,833,644    1,496,407  (3.3%)  18.5%
  Long-term debt       1,632,980    1,109,220    1,555,351  47.2%    5.0%
  Other liabilities      186,808      193,067      176,758  (3.2%)   5.7%
                    ------------ ------------ ------------
     Total
      Liabilities     13,884,057   13,412,959   13,546,755   3.5%    2.5%
  Shareholders'
   equity              1,554,120    1,497,693    1,531,660   3.8%    1.5%
                    ------------ ------------ ------------
     Total Liabilities
      and Shareholders'
      Equity        $ 15,438,177 $ 14,910,652 $ 15,078,415   3.5%    2.4%
                    ============ ============ ============

LOANS, DEPOSITS AND
 SHORT-TERM
 BORROWINGS DETAIL:
Loans, by type:
  Commercial -
   industrial and
   financial        $  2,954,204 $  2,600,807 $  2,864,939  13.6%    3.1%
  Commercial -
   agricultural          374,759      345,332      368,591   8.5%    1.7%
  Real estate -
   commercial
   mortgage            3,407,715    3,174,623    3,331,676   7.3%    2.3%
  Real estate -
   residential
   mortgage              809,148      677,994      731,966  19.3%   10.5%
  Real estate - home
   equity              1,472,376    1,465,373    1,447,058   0.5%    1.7%
  Real estate -
   construction        1,389,164    1,431,535    1,379,449  (3.0%)   0.7%
  Consumer               500,021      529,741      505,365  (5.6%)  (1.1%)
  Leasing and other       80,920       86,652       84,775  (6.6%)  (4.5%)
                    ------------ ------------ ------------
  Total Loans, net
   of unearned
   income           $ 10,988,307 $ 10,312,057 $ 10,713,819   6.6%    2.6%
                    ============ ============ ============
Deposits, by type:
  Noninterest-bearing
   demand           $  1,696,871 $  1,886,514 $  1,818,862 (10.1%)  (6.7%)
  Interest-bearing
   demand              1,738,605    1,658,545    1,667,455   4.8%    4.3%
  Savings deposits     2,195,363    2,351,041    2,292,257  (6.6%)  (4.2%)
  Time deposits        4,660,347    4,380,928    4,539,665   6.4%    2.7%
                    ------------ ------------ ------------
  Total Deposits    $ 10,291,186 $ 10,277,028 $ 10,318,239   0.1%   (0.3%)
                    ============ ============ ============
Short-term borrowings,
 by type:
  Customer
   repurchase
   agreements       $    248,915 $    363,561 $    261,568 (31.5%)  (4.8%)
  Federal funds
   purchased             842,476    1,183,447      830,327 (28.8%)   1.5%
  Short-term
   promissory notes      476,249      236,701      399,317   101.2% 19.3%
  Other                  205,443       49,935        5,195   311.4%  N/M
                    ------------ ------------ ------------
  Total Short-term
   borrowings       $  1,773,083 $  1,833,644 $  1,496,407  (3.3%)  18.5%
                    ============ ============ ============

N/M - Not Meaningful



FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED INCOME STATEMENTS (UNAUDITED)
dollars in thousands, except per-share data


                                  Quarter Ended           % Change from
                          ----------------------------- ------------------
                          September September           September
                             30        30     June 30      30     June 30
                            2007      2006      2007      2006     2007
                          --------- --------- --------- -------- ---------

Interest Income:
 Interest Income          $ 238,740 $ 229,101 $ 230,112    4.2%      3.7%
 Interest Expense           116,330   103,177   109,204   12.7%      6.5%
                          --------- --------- ---------
  Net Interest Income       122,410   125,924   120,908   (2.8%)     1.2%
 Provision for Loan Losses    4,606       555     2,700  729.9%     70.6%
                          --------- --------- ---------
  Net Interest Income
   after Provision          117,804   125,369   118,208   (6.0%)    (0.3%)
Other Income:
 Investment management and
  trust services              9,291     8,887    10,273    4.5%     (9.6%)
 Service charges on
  deposit accounts           11,293    11,345    11,225   (0.5%)     0.6%
 Other service charges and
  fees                        8,530     6,693     7,841   27.4%      8.8%
 Gains on sale of mortgage
  loans                       2,532     5,480     4,188  (53.8%)   (39.5%)
 Investment securities
  (losses) gains               (134)    1,450       629 (109.2%)  (121.3%)
 Other                        5,231     3,057     2,849   71.1%     83.6%
                          --------- --------- ---------
  Total Other Income         36,743    36,912    37,005   (0.5%)    (0.7%)
Other Expenses:
 Salaries and employee
  benefits                   52,505    55,048    55,555   (4.6%)    (5.5%)
 Net occupancy expense        9,813     9,260     9,954    6.0%     (1.4%)
 Equipment expense            3,438     3,703     3,436   (7.2%)     0.1%
 Data processing              3,131     3,057     3,217    2.4%     (2.7%)
 Advertising                  2,470     2,934     2,990  (15.8%)   (17.4%)
 Intangible amortization      1,995     2,025     2,198   (1.5%)    (9.2%)
 Other                       34,644    16,398    20,757  111.3%     66.9%
                          --------- --------- ---------
  Total Other Expenses      107,996    92,425    98,107   16.8%     10.1%
                          --------- --------- ---------
  Income Before Income
   Taxes                     46,551    69,856    57,106  (33.4%)   (18.5%)
 Income Taxes                12,985    21,514    17,261  (39.6%)   (24.8%)
                          --------- --------- ---------
  Net Income              $  33,566 $  48,342 $  39,845  (30.6%)   (15.8%)
                          ========= ========= =========

SHARE AND PER-SHARE
 INFORMATION:
 Net income:
  Basic                   $    0.19 $    0.28 $    0.23  (32.1%)   (17.4%)
  Diluted                      0.19      0.28      0.23  (32.1%)   (17.4%)

 Cash dividends           $  0.1500 $  0.1475 $  0.1500    1.7%        -
 Shareholders' equity          8.96      8.63      8.84    3.8%      1.4%
 Shareholders' equity
  (tangible)                   5.17      4.82      5.03    7.3%      2.8%

 Weighted average shares
  (basic)                   173,304   173,439   173,184   (0.1%)     0.1%
 Weighted average shares
  (diluted)                 174,370   175,390   174,417   (0.6%)       -
 Shares outstanding, end
  of period                 173,394   173,493   173,270   (0.1%)     0.1%

SELECTED FINANCIAL RATIOS:
 Return on average assets      0.88%     1.31%     1.08%
 Return on average
  shareholders' equity         8.67%    13.26%    10.52%
 Return on average
  shareholders' equity
  (tangible)                  15.76%    25.14%    19.30%
 Net interest margin           3.62%     3.85%     3.70%
 Efficiency ratio             65.17%    55.04%    59.72%



                           Nine Months Ended
                              September 30
                          -------------------
                            2007      2006    % Change
                          --------- --------- ---------

Interest Income:
 Interest Income          $ 699,508 $ 634,959    10.2%
 Interest Expense           334,415   271,141    23.3%
                          --------- ---------
  Net Interest Income       365,093   363,818     0.4%
 Provision for Loan Losses    8,263     2,430   240.0%
                          --------- ---------
  Net Interest Income
   after Provision          356,830   361,388    (1.3%)
Other Income:
 Investment management and
  trust services             29,374    27,975     5.0%
 Service charges on
  deposit accounts           33,145    32,484     2.0%
 Other service charges and
  fees                       23,746    19,923    19.2%
 Gains on sale of mortgage
  loans                      12,113    15,439   (21.5%)
 Investment securities
  (losses) gains              2,277     5,524   (58.8%)
 Other                       12,158     8,176    48.7%
                          --------- ---------
  Total Other Income        112,813   109,521     3.0%
Other Expenses:
 Salaries and employee
  benefits                  164,353   158,367     3.8%
 Net occupancy expense       29,963    26,856    11.6%
 Equipment expense           10,589    10,791    (1.9%)
 Data processing              9,550     9,131     4.6%
 Advertising                  7,869     8,214    (4.2%)
 Intangible amortization      6,176     5,883     5.0%
 Other                       78,508    51,992    51.0%
                          --------- ---------
  Total Other Expenses      307,008   271,234    13.2%
                          --------- ---------
  Income Before Income
   Taxes                    162,635   199,675   (18.6%)
 Income Taxes                48,096    60,753   (20.8%)
                          --------- ---------
  Net Income              $ 114,539 $ 138,922   (17.6%)
                          ========= =========

SHARE AND PER-SHARE
 INFORMATION:
 Net income:
  Basic                   $    0.66 $    0.80   (17.5%)
  Diluted                      0.66      0.80   (17.5%)

 Cash dividends           $   0.448 $   0.433     3.5%
 Shareholders' equity
 Shareholders' equity
  (tangible)

 Weighted average shares
  (basic)                   173,254   172,595     0.4%
 Weighted average shares
  (diluted)                 174,493   174,689    (0.1%)
 Shares outstanding, end
  of period

SELECTED FINANCIAL RATIOS:
 Return on average assets      1.03%     1.32%
 Return on average
  shareholders' equity        10.07%    13.04%
 Return on average
  shareholders' equity
  (tangible)                  18.42%    24.34%
 Net interest margin           3.69%     3.88%
 Efficiency ratio             61.97%    55.72%




FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands

                                                     Quarter Ended
                                             -----------------------------
                                                   September 30, 2007
                                             -----------------------------
                                                           Interest   Rate
                                               Balance        (1)     (1)
                                             ------------  ---------  ----
ASSETS
Interest-earning assets:
  Loans and leases                           $ 10,857,636  $ 205,747  7.52%
  Taxable investment securities                 2,116,123     24,583  4.65%
  Tax-exempt investment securities                499,389      6,377  5.11%
  Equity securities                               188,490      2,269  4.80%
                                             ------------  ---------  ----
  Total Investment Securities                   2,804,002     33,229  4.74%
  Loans held for sale                             159,492      2,694  6.76%
  Other interest-earning assets                    34,536        432  4.91%
                                             ------------  ---------  ----
  Total Interest-earning Assets                13,855,666    242,102  6.95%
Noninterest-earning assets:
  Cash and due from banks                         338,862
  Premises and equipment                          190,175
  Other assets                                    890,901
  Less: allowance for loan losses                (108,628)
                                             ------------
  Total Assets                               $ 15,166,976
                                             ============


LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
  Demand deposits                            $  1,729,357  $   7,630  1.75%
  Savings deposits                              2,259,231     13,680  2.40%
  Time deposits                                 4,626,160     55,093  4.72%
                                             ------------  ---------  ----
  Total Interest-bearing Deposits               8,614,748     76,403  3.52%
  Short-term borrowings                         1,477,288     17,786  4.74%
  Long-term debt                                1,655,599     22,141  5.32%
                                             ------------  ---------  ----
  Total Interest-bearing Liabilities           11,747,635    116,330  3.93%
Noninterest-bearing liabilities:
  Demand deposits                               1,703,137
  Other                                           179,391
                                             ------------
  Total Liabilities                            13,630,163
  Shareholders' equity                          1,536,813
                                             ------------
  Total Liabilities and Shareholders' Equity $ 15,166,976
                                             ============

  Net interest income/net interest margin
   (fully taxable equivalent)                                125,772  3.62%
                                                                      ====
  Tax equivalent adjustment                                   (3,362)
                                                           ---------
  Net interest income                                      $ 122,410
                                                           =========




                                                     Quarter Ended
                                             -----------------------------
                                                   September 30, 2006
                                             -----------------------------
                                                           Interest   Rate
                                               Balance        (1)     (1)
                                             ------------  ---------  ----
ASSETS
Interest-earning assets:
  Loans and leases                           $ 10,167,362  $ 194,379  7.59%
  Taxable investment securities                 2,309,644     25,323  4.39%
  Tax-exempt investment securities                449,181      5,496  4.89%
  Equity securities                               155,894      1,833  4.69%
                                             ------------  ---------  ----
  Total Investment Securities                   2,914,719     32,652  4.48%
  Loans held for sale                             227,038      4,224  7.44%
  Other interest-earning assets                    54,424        695  5.03%
                                             ------------  ---------  ----
  Total Interest-earning Assets                13,363,543    231,950  6.90%
Noninterest-earning assets:
  Cash and due from banks                         329,482
  Premises and equipment                          187,876
  Other assets                                    859,800
  Less: allowance for loan losses                (107,090)
                                             ------------
  Total Assets                               $ 14,633,611
                                             ============


LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
  Demand deposits                            $  1,689,386  $   6,529  1.53%
  Savings deposits                              2,370,275     14,258  2.37%
  Time deposits                                 4,294,731     46,254  4.27%
                                             ------------  ---------  ----
  Total Interest-bearing Deposits               8,354,392     67,041  3.18%
  Short-term borrowings                         1,730,970     21,697  4.92%
  Long-term debt                                1,093,815     14,439  5.24%
                                             ------------  ---------  ----
  Total Interest-bearing Liabilities           11,179,177    103,177  3.65%
Noninterest-bearing liabilities:
  Demand deposits                               1,826,800
  Other                                           181,322
                                             ------------
  Total Liabilities                            13,187,299
  Shareholders' equity                          1,446,312
                                             ------------
  Total Liabilities and Shareholders' Equity $ 14,633,611
                                             ============

  Net interest income/net interest margin
   (fully taxable equivalent)                                128,773  3.85%
                                                                      ====
  Tax equivalent adjustment                                   (2,849)
                                                           ---------
  Net interest income                                      $ 125,924
                                                           =========




                                                     Quarter Ended
                                             -----------------------------
                                                     June 30, 2007
                                             -----------------------------
                                                           Interest   Rate
                                               Balance        (1)     (1)
                                             ------------  ---------  ----
ASSETS
Interest-earning assets:
  Loans and leases                           $ 10,582,300  $ 199,085  7.54%
  Taxable investment securities                 1,973,214     21,999  4.46%
  Tax-exempt investment securities                500,341      6,405  5.12%
  Equity securities                               188,558      2,230  4.74%
                                             ------------  ---------  ----
  Total Investment Securities                   2,662,113     30,634  4.60%
  Loans held for sale                             197,852      3,393  6.86%
  Other interest-earning assets                    25,311        311  4.90%
                                             ------------  ---------  ----
  Total Interest-earning Assets                13,467,576    233,423  6.95%
Noninterest-earning assets:
  Cash and due from banks                         340,752
  Premises and equipment                          189,975
  Other assets                                    899,160
  Less: allowance for loan losses                (108,952)
                                             ------------
  Total Assets                               $ 14,788,511
                                             ============


LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
  Demand deposits                            $  1,676,528  $   7,198  1.72%
  Savings deposits                              2,298,910     13,776  2.40%
  Time deposits                                 4,526,107     52,825  4.68%
                                             ------------  ---------  ----
  Total Interest-bearing Deposits               8,501,545     73,799  3.48%
  Short-term borrowings                         1,243,370     14,894  4.77%
  Long-term debt                                1,585,125     20,511  5.19%
                                             ------------  ---------  ----
  Total Interest-bearing Liabilities           11,330,040    109,204  3.86%
Noninterest-bearing liabilities:
  Demand deposits                               1,756,271
  Other                                           183,449
                                             ------------
  Total Liabilities                            13,269,760
  Shareholders' equity                          1,518,751
                                             ------------
  Total Liabilities and Shareholders' Equity $ 14,788,511
                                             ============

  Net interest income/net interest margin
   (fully taxable equivalent)                                124,219  3.70%
                                                                      ====
  Tax equivalent adjustment                                   (3,311)
                                                           ---------
  Net interest income                                      $ 120,908
                                                           =========

(1) Presented on a tax-equivalent basis using a 35% Federal tax rate and
    statutory interest expense disallowances.




AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:


                                                 Quarter Ended
                                     --------------------------------------
                                     September 30 September 30   June 30
                                         2007         2006         2007
                                     ------------ ------------ ------------

Loans, by type:
  Commercial - industrial and
   financial                         $  2,908,049 $  2,587,869 $  2,805,554
  Commercial - agricultural               373,293      337,660      366,679
  Real estate - commercial mortgage     3,383,487    3,113,086    3,287,308
  Real estate - residential mortgage      769,381      658,537      710,433
  Real estate - home equity             1,454,947    1,450,255    1,435,467
  Real estate - construction            1,382,951    1,412,678    1,381,552
  Consumer                                502,482      527,915      506,965
  Leasing and other                        83,046       79,362       88,342
                                     ------------ ------------ ------------

  Total Loans, net of unearned
   income                            $ 10,857,636 $ 10,167,362 $ 10,582,300
                                     ============ ============ ============

Deposits, by type:
  Noninterest-bearing demand         $  1,703,137 $  1,826,800 $  1,756,271
  Interest-bearing demand               1,729,357    1,689,386    1,676,528
  Savings deposits                      2,259,231    2,370,275    2,298,910
  Time deposits                         4,626,160    4,294,731    4,526,107
                                     ------------ ------------ ------------

  Total Deposits                     $ 10,317,885 $ 10,181,192 $ 10,257,816
                                     ============ ============ ============

Short-term borrowings, by type:
  Customer repurchase agreements     $    242,375 $    334,759 $    255,685
  Federal funds purchased                 756,360    1,143,445      586,007
  Short-term promissory notes             446,182      201,282      376,149
  Other                                    32,371       51,484       25,529
                                     ------------ ------------ ------------

  Total Short-term borrowings        $  1,477,288 $  1,730,970 $  1,243,370
                                     ============ ============ ============



                                           % Change from
                                     ------------------------
                                     September 30   June 30
                                         2006        2007
                                     -----------  -----------

Loans, by type:
  Commercial - industrial and
   financial                                12.4%         3.7%
  Commercial - agricultural                 10.6%         1.8%
  Real estate - commercial mortgage          8.7%         2.9%
  Real estate - residential mortgage        16.8%         8.3%
  Real estate - home equity                  0.3%         1.4%
  Real estate - construction                (2.1%)        0.1%
  Consumer                                  (4.8%)       (0.9%)
  Leasing and other                          4.6%        (6.0%)

  Total Loans, net of unearned
   income                                    6.8%         2.6%

Deposits, by type:
  Noninterest-bearing demand                (6.8%)       (3.0%)
  Interest-bearing demand                    2.4%         3.2%
  Savings deposits                          (4.7%)       (1.7%)
  Time deposits                              7.7%         2.2%

  Total Deposits                             1.3%         0.6%

Short-term borrowings, by type:
  Customer repurchase agreements           (27.6%)       (5.2%)
  Federal funds purchased                  (33.9%)       29.1%
  Short-term promissory notes              121.7%        18.6%
  Other                                    (37.1%)       26.8%

  Total Short-term borrowings              (14.7%)       18.8%




FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands
                                         Nine Months Ended September 30
                                       -----------------------------------
                                                       2007
                                       -----------------------------------
                                         Balance     Interest (1)  Rate (1)
                                       ------------  ------------  -------
ASSETS
Interest-earning assets:
  Loans and leases                     $ 10,619,834  $    601,390     7.57%
  Taxable investment securities           2,092,916        71,201     4.54%
  Tax-exempt investment securities          497,504        19,010     5.09%
  Equity securities                         185,215         6,628     4.78%
                                       ------------  ------------  -------
  Total Investment Securities             2,775,635        96,839     4.65%
  Loans held for sale                       188,223         9,771     6.92%
  Other interest-earning assets              36,008         1,339     4.93%
                                       ------------  ------------  -------
  Total Interest-earning Assets          13,619,700       709,339     6.96%
Noninterest-earning assets:
  Cash and due from banks                   331,945
  Premises and equipment                    190,711
  Other assets                              896,604
  Less: allowance for loan losses          (108,425)
                                       ------------
  Total Assets                         $ 14,930,535
                                       ============

LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
  Demand deposits                      $  1,688,129  $     21,733     1.72%
  Savings deposits                        2,284,521        41,266     2.41%
  Time deposits                           4,537,160       158,411     4.67%
                                       ------------  ------------  -------
  Total Interest-bearing Deposits         8,509,810       221,410     3.48%
  Short-term borrowings                   1,424,109        51,734     4.82%
  Long-term debt                          1,564,333        61,271     5.23%
                                       ------------  ------------  -------
  Total Interest-bearing Liabilities     11,498,252       334,415     3.88%
Noninterest-bearing liabilities:
  Demand deposits                         1,726,782
  Other                                     184,010
                                       ------------
  Total Liabilities                      13,409,044
  Shareholders' equity                    1,521,491
                                       ------------
  Total Liabilities and Shareholders'
   Equity                              $ 14,930,535
                                       ============

  Net interest income/net interest
   margin (fully taxable equivalent)                      374,924     3.69%
                                                                   =======
  Tax equivalent adjustment                                (9,831)
                                                     ------------
  Net interest income                                $    365,093
                                                     ============



                                         Nine Months Ended September 30
                                       -----------------------------------
                                                       2006
                                       -----------------------------------
                                         Balance     Interest (1)  Rate (1)
                                       ------------  ------------  -------
ASSETS
Interest-earning assets:
  Loans and leases                     $  9,750,452  $    537,281     7.37%
  Taxable investment securities           2,246,672        71,426     4.24%
  Tax-exempt investment securities          438,510        15,881     4.83%
  Equity securities                         151,078         5,132     4.53%
                                       ------------  ------------  -------
  Total Investment Securities             2,836,260        92,439     4.35%
  Loans held for sale                       216,295        11,688     7.21%
  Other interest-earning assets              56,045         1,950     4.63%
                                       ------------  ------------  -------
  Total Interest-earning Assets          12,859,052       643,358     6.69%
Noninterest-earning assets:
  Cash and due from banks                   340,885
  Premises and equipment                    183,112
  Other assets                              836,754
  Less: allowance for loan losses          (105,291)
                                       ------------
  Total Assets                         $ 14,114,512
                                       ============

LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
  Demand deposits                      $  1,676,087  $     18,112     1.44%
  Savings deposits                        2,340,708        37,181     2.12%
  Time deposits                           4,042,569       120,934     4.00%
                                       ------------  ------------  -------
  Total Interest-bearing Deposits         8,059,364       176,227     2.92%
  Short-term borrowings                   1,607,946        55,430     4.56%
  Long-term debt                          1,033,706        39,484     5.11%
                                       ------------  ------------  -------
  Total Interest-bearing Liabilities     10,701,016       271,141     3.38%
Noninterest-bearing liabilities:
  Demand deposits                         1,817,547
  Other                                     171,391
                                       ------------
  Total Liabilities                      12,689,954
  Shareholders' equity                    1,424,558
                                       ------------
  Total Liabilities and Shareholders'
   Equity                              $ 14,114,512
                                       ============

  Net interest income/net interest
   margin (fully taxable equivalent)                      372,217     3.88%
                                                                   =======
  Tax equivalent adjustment                                (8,399)
                                                     ------------
  Net interest income                                $    363,818
                                                     ============

(1) Presented on a tax-equivalent basis using a 35% Federal tax rate and
    statutory interest expense disallowances.



AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:

                                            Nine Months Ended
                                              September 30
                                       --------------------------
                                          2007           2006      % Change
                                       ------------  ------------  -------

Loans, by type:
  Commercial - industrial and
   financial                           $  2,795,619  $  2,445,367    14.3%
  Commercial - agricultural                 366,905       330,368    11.1%
  Real estate - commercial mortgage       3,303,854     3,033,010     8.9%
  Real estate - residential mortgage        727,491       624,546    16.5%
  Real estate - home equity               1,444,100     1,401,875     3.0%
  Real estate - construction              1,386,960     1,317,274     5.3%
  Consumer                                  508,544       522,381    (2.6%)
  Leasing and other                          86,361        75,631    14.2%
                                       ------------  ------------

  Total Loans, net of unearned income  $ 10,619,834  $  9,750,452     8.9%
                                       ============  ============

Deposits, by type:
  Noninterest-bearing demand           $  1,726,782  $  1,817,547    (5.0%)
  Interest-bearing demand                 1,688,129     1,676,087     0.7%
  Savings deposits                        2,284,521     2,340,708    (2.4%)
  Time deposits                           4,537,160     4,042,569    12.2%
                                       ------------  ------------

  Total Deposits                       $ 10,236,592  $  9,876,911     3.6%
                                       ============  ============

Short-term borrowings, by type:
  Customer repurchase agreements       $    251,520  $    358,079   (29.8%)
  Federal funds purchased                   751,954     1,084,901   (30.7%)
  Short-term promissory notes               379,761       126,917   199.2%
  Other                                      40,874        38,049     7.4%
                                       ------------  ------------

  Total Short-term borrowings          $  1,424,109  $  1,607,946   (11.4%)
                                       ============  ============




FULTON FINANCIAL CORPORATION
ASSET QUALITY INFORMATION (UNAUDITED)
dollars in thousands


                                 Quarter Ended           Nine Months Ended
                         -----------------------------     September 30
                          Sept 30   Sept 30   June 30  --------- ---------
                           2007      2006      2007      2007      2006
                         --------- --------- --------- --------- ---------
ALLOWANCE FOR LOAN LOSSES:
  Balance at beginning of
   period                $ 106,892 $ 106,544 $ 107,899 $ 106,884 $  92,847
  Loans charged off         (2,805)   (1,068)   (4,506)   (8,671)   (4,247)
  Recoveries of loans
   previously charged off      742     1,391       799     2,959     3,401
                         --------- --------- --------- --------- ---------
  Net loans (charged off)
   recovered                (2,063)      323    (3,707)   (5,712)     (846)
  Provision for loan
   losses                    4,606       555     2,700     8,263     2,430
  Allowance purchased            -         -         -         -    12,991
                         --------- --------- --------- --------- ---------
  Balance at end of
   period                $ 109,435 $ 107,422 $ 106,892 $ 109,435 $ 107,422
                         ========= ========= ========= ========= =========

  Net charge-offs
   (recoveries) to
   average loans
   (annualized)               0.08%  (0.01%)      0.14%     0.07%     0.01%
                         ========= ========= ========= ========= =========

NON-PERFORMING ASSETS:
  Non-accrual loans      $  71,056 $  26,591 $  46,683
  Accruing loans 90+ days
   overdue                  23,406    16,704    21,559
  Other real estate owned   12,536     3,489     5,899
                         --------- --------- ---------
  Total non-performing
   assets                $ 106,998 $  46,784 $  74,141
                         ========= ========= =========

ASSET QUALITY RATIOS:
  Non-accrual loans to
   total loans                0.65%     0.26%     0.44%
  Non-performing assets
   to total loans and
   OREO                       0.97%     0.45%     0.69%
  Non-performing assets
   to total assets            0.69%     0.31%     0.49%
  Allowance for loan
   losses to loans
   outstanding                1.00%     1.04%     1.00%
  Allowance/non-performing
   loans                       116%      248%      157%

Contact Information

  • Media Contact :
    Laura J. Wakeley
    717-291-2616
    cell: 717-371-2379