SOURCE: Fulton Financial Corporation

July 19, 2005 12:40 ET

Fulton Financial Net Income Up 9.8% in Second Quarter

LANCASTER, PA -- (MARKET WIRE) -- July 19, 2005 -- Fulton Financial Corporation (NASDAQ: FULT) earned $41.6 million in the second quarter of 2005, a 9.8 percent increase over $37.9 million for the same period in 2004. Diluted net income per share increased to 27 cents, an 8.0 percent increase over the 25 cents reported for the second quarter of 2004. Annualized return on average assets was 1.46 percent for the quarter. Annualized return on average equity was 13.95 percent and annualized return on tangible equity was 20.64 percent.

The Lancaster, Pennsylvania-based financial holding company reported net income of $83.1 million for the six months ended June 30, 2005, a 12.8 percent increase over the same period in 2004. Diluted net income per share for the first six months of 2005 increased to 53 cents, a 6.0 percent increase over the 50 cents reported in 2004. Total assets at June 30, 2005 were approximately $11.6 billion.

"Our second quarter results reflect continued steady growth, both internally and as a result of acquisitions," said Rufus A. Fulton, Jr., chairman and chief executive officer. "Over the past two years we have successfully integrated three acquired banks while continuing to grow our existing franchise. The success of this balanced growth strategy is evident in our second quarter performance. Most importantly, we have achieved these results without compromising the strong asset quality that has long been our hallmark."

Loans, net of unearned income, increased $819.2 million, or 11.6 percent, to $7.9 billion at June 30, 2005, compared to $7.0 billion at June 30, 2004. Approximately $245.0 million of this increase resulted from the December 31, 2004 acquisition of First Washington State Bank. The remaining increase was realized mainly in commercial loans and commercial mortgages, which grew $374.2 million, or 8.0 percent, and home equity loans, which increased $103.7 million, or 10.3 percent.

Non-performing assets were 0.27 percent of total assets at June 30, 2005 and 0.31 percent of total assets at June 30, 2004, reflecting an improvement in overall asset quality. Annualized net charge-offs for the quarter ended June 30, 2005 were 0.02 percent of average total loans, compared to 0.03 percent for the same period of 2004. For the six months ended June 30, 2005, net charge-offs were 0.02 percent of average loans, compared to 0.05 percent for 2004. The provision for loan losses decreased $75,000, or 9.4 percent, for the second quarter of 2005 as compared to the same period in 2004.

Total deposits increased $708.7 million, or 9.5 percent, from June 30, 2004 to June 30, 2005, to $8.1 billion. Approximately $426.5 million of this increase resulted from the First Washington acquisition, with the remaining $282.2 million increase realized in both core deposit accounts and time deposits.

Net interest income for the quarter increased $11.2 million, or 12.6 percent, compared to the second quarter of 2004. Fulton Financial's net interest margin was 3.92% for the second quarter of 2005, compared to 3.95% for the first quarter of 2005 and 3.73% for the second quarter of 2004. After steady increases in net interest margin in each of the preceding three quarters as a result of the Federal Reserve raising short-term interest rates, a small decrease was realized in the second quarter of 2005. Contributing to the decrease was $100 million of subordinated debt issued in March 2005, which reduced net interest margin in the second quarter of 2005 by approximately four basis points.

Other income, including investment securities gains, increased $1.7 million, or 4.5 percent, to $38.3 million in the second quarter of 2005. Increases due to growth and a $2.2 million gain on branch sales were offset by a $3.9 million decrease in investment securities gains. First Washington contributed approximately $760,000 to the other income increase.

Other expenses increased $7.6 million, or 10.7 percent, compared to the second quarter of 2004, to $78.1 million. First Washington contributed $3.4 million to the other expense increase with remaining increases realized mainly in salaries and benefits expense. The efficiency ratio for the second quarter of 2005 was 55.3 percent, an improvement from 56.5 percent for the second quarter of 2004.

Fulton Financial Corporation is a Lancaster, Pennsylvania-based financial holding company which operates 232 banking offices in Pennsylvania, Maryland, Delaware, New Jersey and Virginia through the following affiliates: Fulton Bank, Lancaster, PA; Lebanon Valley Farmers Bank, Lebanon, 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; Premier Bank, Doylestown, PA; Resource Bank, Virginia Beach, VA; and First Washington State Bank, Windsor, NJ.

On July 1, 2005, the Corporation completed its acquisition of SVB Financial Services, Inc., based in Somerville, New Jersey. SVB's sole banking subsidiary is Somerset Valley Bank, also based in Somerville. The bank operates 11 community-banking offices in Somerset, Middlesex and Hunterdon Counties and has approximately $475 million in assets. As a result of the acquisition, SVB was merged into Fulton Financial and Somerset Valley Bank became its 14th affiliate bank. The results of SVB will be included in Fulton Financial's results prospectively from the July 1, 2005 acquisition date. As a result of this acquisition, Fulton Financial has total assets of approximately $12.1 billion.

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 about Fulton Financial Corporation's future financial performance. Forward-looking statements are encouraged by the Private Securities Litigation Reform Act of 1995.

Such forward-looking information is based upon certain underlying assumptions, risks and uncertainties. Because of the possibility of change in the underlying assumptions, actual results could differ materially from these forward-looking statements. Risks and uncertainties that may affect future results include: pricing pressures on loans and deposits, actions of bank and non-bank competitors, changes in local and national economic conditions, changes in regulatory requirements, actions of the Federal Reserve Board, the Corporation's success in merger and acquisition integration, and customers' acceptance of the Corporation's products and services.

FULTON FINANCIAL CORPORATION
FINANCIAL HIGHLIGHTS (UNAUDITED)

                                         Quarter Ended
                                           June 30             Variance
                                     2005          2004         $      %
                                  --------     --------     ------   -----
INCOME SUMMARY:                     (in thousands, except per-share data)

 Interest income                 $ 148,611    $ 122,024   $ 26,587   21.8%
 Interest expense                   48,686       33,318     15,368   46.1%
                                  --------     --------     ------   -----

         Net Interest Income        99,925       88,706     11,219   12.6%
 Provision for loan losses             725          800        (75)  -9.4%
 Investment securities
  gains                              1,418        5,349     (3,931) -73.5%
 Other income                       36,897       31,313      5,584   17.8%
 Other expenses                     78,106       70,537      7,569   10.7%
                                  --------     --------     ------   -----

         Income Before
          Income Taxes              59,409       54,031      5,378   10.0%
  Income taxes                      17,829       16,167      1,662   10.3%
                                  --------     --------     ------   -----

         Net Income               $ 41,580     $ 37,864    $ 3,716    9.8%
                                 =========    =========   ========

Fully taxable equivalent
 (FTE) net interest income       $ 102,266     $ 91,038   $ 11,228   12.3%

PER-SHARE DATA:

 Net income:
        Basic                       $ 0.27       $ 0.25     $ 0.02    8.0%
        Diluted                       0.27         0.25       0.02    8.0%

 Cash dividends                      0.145        0.132      0.013    9.8%

ENDING BALANCES:

 Total assets                  $11,571,083  $10,556,421 $1,014,662    9.6%
 Loans, net of
  unearned income                7,861,508    7,042,311    819,197   11.6%
 Deposits                        8,139,667    7,430,988    708,679    9.5%
 Short-term borrowings           1,134,583    1,241,522   (106,939)  -8.6%
 Long-term debt                    951,745      654,886    296,859   45.3%
 Shareholders' equity            1,194,075    1,107,482     86,593    7.8%

AVERAGE BALANCES:

 Total assets                  $11,417,078  $10,603,544  $ 813,534    7.7%
 Loans, net of
  unearned income                7,823,737    6,946,626    877,111   12.6%
 Deposits                        8,059,110    7,448,275    610,835    8.2%
 Short-term borrowings           1,180,975    1,282,657   (101,682)  -7.9%
 Long-term debt                    841,650      656,803    184,847   28.1%
 Shareholders' equity            1,195,455    1,101,590     93,865    8.5%


FULTON FINANCIAL CORPORATION
FINANCIAL HIGHLIGHTS (UNAUDITED)
                                     Six Months Ended
                                         June 30              Variance
                                    2005         2004        $         %
                                  -------      -------    -------   -------

INCOME SUMMARY:                     (in thousands, except per-share data)

 Interest income               $   289,421  $   235,960  $   53,461   22.7%
 Interest expense                   91,248       64,287      26,961   41.9%
                               -----------  -----------  ----------

    Net Interest Income            198,173      171,673      26,500   15.4%
 Provision for loan losses           1,525        2,540      (1,015) -40.0%
 Investment securities gains         4,733       11,177      (6,444) -57.7%
 Other income                       69,435       57,523      11,912   20.7%
 Other expenses                    151,837      132,809      19,028   14.3%
                               -----------  -----------  ----------

    Income Before Income Taxes     118,979      105,024      13,955   13.3%
 Income taxes                       35,868       31,314       4,554   14.5%
                               -----------  -----------  ----------

    Net Income                 $    83,111  $    73,710      $9,401   12.8%
                               ===========  ===========  ==========

Fully taxable equivalent (FTE)
 net interest income           $   202,858  $   176,351  $   26,507   15.0%

PER-SHARE DATA:

 Net income:
   Basic                       $      0.53  $      0.50  $     0.03    6.0%
   Diluted                            0.53         0.50        0.03    6.0%

 Cash dividends                      0.277        0.254       0.023    9.1%

AVERAGE BALANCES:

 Total assets                  $11,314,220  $10,140,019  $1,174,201   11.6%
 Loans, net of unearned income   7,749,797    6,567,307   1,182,490   18.0%
 Deposits                        7,986,110    7,083,167     902,943   12.7%
 Short-term borrowings           1,210,053    1,313,970    (103,917)  -7.9%
 Long-term debt                    761,992      613,439     148,553   24.2%
 Shareholders' equity            1,222,511    1,025,658     196,853   19.2%


FULTON FINANCIAL CORPORATION
FINANCIAL HIGHLIGHTS (UNAUDITED)

                           Quarter Ended                 Variance
                    --------------------------  --------------------------
                       June 30      March 31
                        2005          2005           $             %
                    ------------  ------------  ------------  ------------
INCOME SUMMARY:             (in thousands, except per-share data)

  Interest income   $    148,611  $    140,810  $      7,801           5.5%
  Interest expense        48,686        42,562         6,124          14.4%
                    ------------  ------------  ------------

    Net Interest
     Income               99,925        98,248         1,677           1.7%
  Provision for loan
   losses                    725           800           (75)         -9.4%
  Investment
   securities gains        1,418         3,315        (1,897)        -57.2%
  Other income            36,897        32,538         4,359          13.4%
  Other expenses          78,106        73,731         4,375           5.9%
                    ------------  ------------  ------------

    Income Before
     Income Taxes         59,409        59,570          (161)         -0.3%
  Income taxes            17,829        18,039          (210)         -1.2%
                    ------------  ------------  ------------

    Net Income      $     41,580  $     41,531  $         49           0.1%
                    ============  ============  ============

Fully taxable
 equivalent (FTE)
 net interest
 income             $    102,266  $    100,592  $      1,674           1.7%

PER-SHARE DATA:

  Net income:
    Basic           $       0.27  $       0.26  $       0.01           3.8%
    Diluted                 0.27          0.26          0.01           3.8%

  Cash dividends           0.145         0.132         0.013           9.8%

ENDING BALANCES:

  Total assets      $ 11,571,083  $ 11,418,278  $    152,805           1.3%
  Loans, net of
   unearned income     7,861,508     7,747,301       114,207           1.5%
  Deposits             8,139,667     7,981,147       158,520           2.0%
  Short-term
   borrowings          1,134,583     1,265,360      (130,777)        -10.3%
  Long-term debt         951,745       773,129       178,616          23.1%
  Shareholders'
   equity              1,194,075     1,235,519       (41,444)         -3.4%

AVERAGE BALANCES:

  Total assets      $ 11,417,078  $ 11,210,219  $    206,859           1.8%
  Loans, net of
   unearned income     7,823,737     7,675,034       148,703           1.9%
  Deposits             8,059,110     7,912,299       146,811           1.9%
  Short-term
   borrowings          1,180,975     1,239,454       (58,479)         -4.7%
  Long-term debt         841,650       681,450       160,200          23.5%
  Shareholders'
   equity              1,195,455     1,249,868       (54,413)         -4.4%


FULTON FINANCIAL CORPORATION
CONSOLIDATED ENDING BALANCE SHEET (UNAUDITED)

                                       June 30                 Variance
                                   2005        2004           $        %
                             -----------  -----------     -------  -------
                                              (in thousands)
ASSETS

  Cash and due from banks       $358,581     $335,176       $23,405    7.0%
  Loans held for sale            237,713      144,050        93,663   65.0%
  Other interest-earning
   assets                         22,600        7,021        15,579  221.9%
  Investment securities        2,429,365    2,489,031       (59,666)  -2.4%
  Loans, net of allowance      7,771,106    6,955,772       815,334   11.7%
  Premises and equipment         153,598      130,721        22,877   17.5%
  Accrued interest
   receivable                     43,819       35,701         8,118   22.7%
  Goodwill and intangible
   assets                        386,795      296,213        90,582   30.6%
  Other assets                   167,506      162,736         4,770    2.9%
                             -----------  -----------    ----------

      Total Assets           $11,571,083  $10,556,421    $1,014,662    9.6%
                             ===========  ===========    ==========

LIABILITIES AND SHAREHOLDERS' EQUITY



  Deposits                    $8,139,667   $7,430,988      $708,679    9.5%
  Short-term borrowings        1,134,583    1,241,522      (106,939)  -8.6%
  Long-term debt                 951,745      654,886       296,859   45.3%
  Other liabilities              151,013      121,543        29,470   24.2%
                             -----------  -----------    ----------

      Total Liabilities       10,377,008    9,448,939       928,069    9.8%
                             -----------  -----------    ----------

  Shareholders' equity         1,194,075    1,107,482        86,593    7.8%
                             -----------  -----------    ----------

      Total Liabilities and
       Shareholders' Equity  $11,571,083  $10,556,421    $1,014,662    9.6%
                             ===========  ===========    ==========

LOANS AND DEPOSITS DETAIL:



Loans, by type:
  Commercial - industrial
   and financial              $1,991,480   $1,818,570      $172,910    9.5%
  Commercial - agricultural      322,791      324,465        (1,674)  -0.5%
  Real estate - commercial
   mortgage                    2,556,990    2,240,228       316,762   14.1%
  Real estate - residential
   mortgage                      558,845      504,320        54,525   10.8%
  Real estate - construction     743,774      560,865       182,909   32.6%
  Real estate - home equity    1,141,749    1,004,532       137,217   13.7%
  Consumer                       485,492      522,576       (37,084)  -7.1%
  Leasing and other               60,387       66,755        (6,368)  -9.5%
                             -----------  -----------    ----------

  Total Loans, net of
   unearned income            $7,861,508   $7,042,311      $819,197   11.6%
                             ===========  ===========    ==========

Deposits, by type:
  Noninterest-bearing demand  $1,611,909   $1,414,770      $197,139   13.9%
  Interest-bearing demand      1,471,398    1,361,379       110,019    8.1%
  Savings deposits             1,965,523    1,866,042        99,481    5.3%
  Time deposits                3,090,837    2,788,797       302,040   10.8%
                             -----------  -----------    ----------


  Total Deposits              $8,139,667   $7,430,988      $708,679    9.5%
                             ===========  ===========    ==========


FULTON FINANCIAL CORPORATION
CONSOLIDATED INCOME STATEMENT (UNAUDITED)
                                      Quarter Ended
                                        June 30              Variance
                                   2005        2004       $             %
                                 --------   --------   --------   --------
                                  (in thousands, except per-share data)
Interest Income:
  Loans, including
   fees                          $123,309   $ 96,859   $ 26,450       27.3%
  Investment securities:
    Taxable                        18,257     19,652     (1,395)      -7.1%
    Tax-exempt                      2,843      2,540        303       11.9%
    Dividends                       1,155        992        163       16.4%
  Loans held for sale               2,699      1,962        737       37.6%
  Other interest income               348         19        329     1731.6%
                                 --------   --------   --------
    Total Interest Income         148,611    122,024     26,587       21.8%

Interest Expense:
  Deposits                         31,104     22,345      8,759       39.2%
  Short-term borrowings             7,914      3,135      4,779      152.4%
  Long-term debt                    9,668      7,838      1,830       23.3%
                                 --------   --------   --------
    Total Interest Expense         48,686     33,318     15,368       46.1%
                                 --------   --------   --------
    Net Interest Income            99,925     88,706     11,219       12.6%
  Provision for Loan Losses           725        800        (75)      -9.4%
                                 --------   --------   --------
    Net Interest Income
     after Provision               99,200     87,906     11,294       12.8%

Other Income:
  Investment management and
   trust services                   8,966      8,637        329        3.8%
  Service charges on deposit
   accounts                         9,960      9,929         31        0.3%
  Other service charges and
   fees                             7,142      4,970      2,172       43.7%
  Gain on sale of mortgage
   loans                            6,290      6,050        240        4.0%
  Investment securities
   gains                            1,418      5,349     (3,931)     -73.5%
  Other                             4,539      1,727      2,812      162.8%
                                 --------   --------   --------
    Total Other Income             38,315     36,662      1,653        4.5%

Other Expenses:
  Salaries and employee
   benefits                        45,152     41,834      3,318        7.9%
  Net occupancy expense             6,549      5,859        690       11.8%
  Equipment expense                 2,888      2,749        139        5.1%
  Data processing                   3,321      2,868        453       15.8%
  Advertising                       2,276      1,914        362       18.9%
  Intangible amortization           1,168      1,356       (188)     -13.9%
  Other                            16,752     13,957      2,795       20.0%
                                 --------   --------   --------
    Total Other Expenses           78,106     70,537      7,569       10.7%
                                 --------   --------   --------
    Income Before Income
     Taxes                         59,409     54,031      5,378       10.0%
  Income Taxes                     17,829     16,167      1,662       10.3%
                                 --------   --------   --------
    Net Income                   $ 41,580   $ 37,864   $  3,716        9.8%
                                 ========   ========   ========

SHARE AND PER-SHARE
 INFORMATION:

  Net income:
    Basic                        $   0.27   $   0.25   $    0.02       8.0%
    Diluted                          0.27       0.25        0.02       8.0%

  Cash dividends                 $  0.145   $  0.132   $   0.013       9.8%
  Book value                         7.81       7.27        0.54       7.4%
  Tangible book value                5.28       5.33       (0.05)     -0.9%

  Weighted average
   shares (basic)                 154,509    152,647       1,862       1.2%
  Weighted average
   shares (diluted)               156,230    154,356       1,874       1.2%
  Shares outstanding,
   end of period                  152,956    152,350         606       0.4%

SELECTED FINANCIAL RATIOS:

  Return on average assets          1.46%       1.44%
  Return on average equity         13.95%      13.82%
  Return on average equity
   (tangible)                      20.64%      17.84%
  Net interest margin               3.92%       3.73%
  Efficiency ratio                  55.3%       56.5%
  Average equity to
   average assets                   10.5%       10.4%


FULTON FINANCIAL CORPORATION
AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)

                                             Quarter Ended June 30
                                                    2005

                                 Balance      Interest  Rate (1)   Balance
                               ----------     -------   -----      -------
ASSETS                                      (dollars in thousands)

Interest-earning assets:
    Loans and leases           $7,823,737   $ 124,080   6.36%   $6,946,626
    Taxable investment
     securities                 1,965,683      18,257   3.71%    2,299,834
    Tax-exempt investment
     securities                   341,044       4,227   4.96%      272,891
    Equity securities             129,980       1,341   4.14%      137,528
                               ----------     -------  ------      -------

    Total Investment
     Securities                 2,436,707      23,825   3.91%    2,710,253

    Loans held for sale           152,502       2,699   7.08%      115,658
    Other interest-earning
     assets                        47,819         348   2.90%        6,719
                               ----------     -------  ------      -------


    Total Interest-earning
     Assets                    10,460,765     150,952   5.79%    9,779,256

Noninterest-earning assets:
    Cash and due from banks       342,592                          332,651
    Premises and equipment        152,123                          130,737
    Other assets                  552,807                          447,700
    Less: allowance for
     loan losses                  (91,209)                         (86,800)
                               ----------                          -------

    Total Assets              $11,417,078                      $10,603,544
                              ===========                      ===========



LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing liabilities:
    Demand deposits            $1,484,772     $ 3,309   0.89%   $1,362,761
    Savings deposits            1,986,909       5,859   1.18%    1,857,175
    Time deposits               3,019,818      21,936   2.91%    2,841,569
                               ----------     -------  ------      -------

    Total Interest-bearing
     Deposits                   6,491,499      31,104   1.92%    6,061,505

    Short-term borrowings       1,180,975       7,914   2.68%    1,282,657
    Long-term debt                841,650       9,668   4.59%      656,803
                               ----------     -------  ------      -------

    Total Interest-bearing
     Liabilities                8,514,124      48,686   2.29%    8,000,965

Noninterest-bearing
 liabilities:
    Demand deposits             1,567,611                        1,386,770
    Other                         139,888                          114,219
                               ----------                          -------

    Total Liabilities          10,221,623                        9,501,954

    Shareholders' equity        1,195,455                        1,101,590
                               ----------                          -------

    Total Liabilities
     and Shareholders'
      Equity                  $11,417,078                      $10,603,544
                              ===========                      ===========

    Net interest income/net
     interest margin
     (fully taxable equivalent)               102,266   3.92%
                                                       ======

    Tax equivalent adjustment                  (2,341)
                                              -------

    Net interest income                      $ 99,925
                                              =======


    (1) Presented on a tax-equivalent basis using a 35% Federal tax rate.



FULTON FINANCIAL CORPORATION
AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)

                                                    Quarter Ended June 30
                                                  ------------------------
                                                           2004
                                                  ---------     -------
                                                   Interest     Rate (1)
                                                  ---------     -------
ASSETS                                             (dollars in thousands)

Interest-earning assets:
    Loans and leases                               $ 97,705       5.65%
    Taxable investment securities                    19,652       3.39%
    Tax-exempt investment securities                  3,822       5.60%
    Equity securities                                 1,196       3.49%
                                                  ---------     -------


    Total Investment Securities                      24,670       3.62%

    Loans held for sale                               1,962       6.79%
    Other interest-earning assets                        19       1.09%
                                                  ---------     -------

    Total Interest-earning Assets                   124,356       5.10%

Noninterest-earning assets:
    Cash and due from banks
    Premises and equipment
    Other assets
    Less: allowance for loan losses

    Total Assets


LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing liabilities:
    Demand deposits                                 $ 1,634       0.48%
    Savings deposits                                  2,637       0.57%
    Time deposits                                    18,074       2.56%
                                                  ---------     -------

    Total Interest-bearing Deposits                  22,345       1.48%

    Short-term borrowings                             3,135       0.98%
    Long-term debt                                    7,838       4.70%
                                                  ---------     -------

    Total Interest-bearing Liabilities               33,318       1.67%

Noninterest-bearing liabilities:
    Demand deposits
    Other

    Total Liabilities

    Shareholders' equity

    Total Liabilities and Shareholders' Equity

    Net interest income/net interest
     margin (fully taxable equivalent)               91,038       3.73%
                                                                ========

    Tax equivalent adjustment                        (2,332)
                                                  ---------

    Net interest income                            $ 88,706
                                                  =========

   (1) Presented on a tax-equivalent basis using a 35% Federal tax rate.


FULTON FINANCIAL CORPORATION
CONSOLIDATED INCOME STATEMENT (UNAUDITED)

                                    Six Months Ended
                                        June 30               Variance
                                    2005       2004         $          %
                                 --------   --------   --------   --------
                                 (in thousands, except per-share data)
Interest Income:
  Loans, including fees          $239,937   $185,325   $ 54,612       29.5%
  Investment securities:
    Taxable                        36,518     41,388     (4,870)     -11.8%
    Tax-exempt                      5,692      5,073        619       12.2%
    Dividends                       2,239      1,944        295       15.2%
  Loans held for sale               4,511      2,201      2,310      105.0%
  Other interest income               524         29        495     1706.9%
                                 --------   --------   --------
    Total Interest Income         289,421    235,960     53,461       22.7%
Interest Expense:
  Deposits                         58,912     42,695     16,217       38.0%
  Short-term borrowings            14,738      6,462      8,276      128.1%
  Long-term debt                   17,598     15,130      2,468       16.3%
                                 --------   --------   --------
    Total Interest Expense         91,248     64,287     26,961       41.9%
                                 --------   --------   --------
    Net Interest Income           198,173    171,673     26,500       15.4%
  Provision for Loan Losses         1,525      2,540     (1,015)     -40.0%
                                 --------   --------   --------
    Net Interest Income
     after Provision              196,648    169,133     27,515       16.3%

Other Income:
  Investment management and
   trust services                  17,985     17,282        703        4.1%
  Service charges on deposit
   accounts                        19,292     19,434       (142)      -0.7%
  Other service charges
   and fees                        12,698      9,996      2,702       27.0%
  Gain on sale of
   mortgage loans                  12,339      7,764      4,575       58.9%
  Investment securities
   gains                            4,733     11,177     (6,444)     -57.7%
  Other                             7,121      3,047      4,074      133.7%
                                 --------   --------   --------
    Total Other Income             74,168     68,700      5,468        8.0%

Other Expenses:
  Salaries and employee
   benefits                        89,353     78,592     10,761       13.7%
  Net occupancy expense            14,047     11,377      2,670       23.5%
  Equipment expense                 5,958      5,390        568       10.5%
  Data processing                   6,490      5,687        803       14.1%
  Advertising                       4,249      3,442        807       23.4%
  Intangible amortization           2,347      2,347          -        0.0%
  Other                            29,393     25,974      3,419       13.2%
                                 --------   --------   --------
    Total Other Expenses          151,837    132,809     19,028       14.3%
                                 --------   --------   --------
    Income Before Income
     Taxes                        118,979    105,024     13,955       13.3%
  Income Taxes                     35,868     31,314      4,554       14.5%
                                 --------   --------   --------
     Net Income                  $ 83,111   $ 73,710     $9,401       12.8%
                                 ========   ========   ========

SHARE AND PER-SHARE
 INFORMATION:
  Net income:
    Basic                        $   0.53   $   0.50   $   0.03        6.0%
    Diluted                          0.53       0.50       0.03        6.0%
  Cash dividends                 $  0.277   $  0.254   $  0.023        9.1%
  Book value                         7.81       7.27       0.54        7.4%
  Tangible book value                5.28       5.33      (0.05)      -0.9%
  Weighted average
   shares (basic)                 155,922    147,380      8,542        5.8%
  Weighted average
   shares (diluted)               157,750    148,854      8,896        6.0%
  Shares outstanding,
   end of period                  152,956    152,350        606        0.4%

SELECTED FINANCIAL RATIOS:
  Return on average assets           1.48%     1.46%
  Return on average equity          13.71%    14.45%
  Return on average
   equity (tangible)                20.09%    17.89%
  Net interest margin                3.94%     3.76%
  Efficiency ratio                   54.9%     55.8%
  Average equity to
   average assets                    10.8%     10.1%



FULTON FINANCIAL CORPORATION
AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)

                                          Six Months Ended June 30
                                                   2005

                                  Balance    Interest  Rate (1)   Balance
                                ----------  ---------  ------   ----------

ASSETS                                     (dollars in thousands)

Interest-earning assets:
    Loans and leases            $7,749,797  $ 241,461   6.28%   $6,567,307
    Taxable investment
     securit                     1,974,723     36,518   3.69%    2,351,126
    Tax-exempt investment
     securitites                   338,215      8,481   5.02%      274,517
    Equity securities              126,907      2,611   4.13%      134,540
                                ----------  ---------  ------   ----------

    Total Investment
     Securities                  2,439,845     47,610   3.90%    2,760,183

    Mortgage loans held
     for sale                      132,670      4,511   6.80%       65,435
    Short-term investments          38,313        524   2.74%        5,231
                                ----------  ---------  ------   ----------
    Total Interest-earning
     Assets                     10,360,625    294,106   5.71%    9,398,156

Noninterest-earning assets:
    Cash and due from banks        332,747                         316,720
    Premises and equipment         150,579                         126,083
    Other assets                   561,120                         381,826
    Less: allowance for
     loan losses                   (90,851)                        (82,766)
                                ----------                      ----------

    Total Assets               $11,314,220                     $10,140,019
                                ==========                      ==========


LIABILITIES AND SHAREHOLDERS'
 EQUITY

Interest-bearing liabilities:
    Demand deposits             $1,489,850    $ 6,279   0.85%   $1,315,716
    Savings deposits             1,949,573     10,324   1.07%    1,808,639
    Time deposits                3,008,161     42,309   2.84%    2,636,657
                                ----------  ---------  ------   ----------

    Total Interest-bearing
     Deposits                    6,447,584     58,912   1.84%    5,761,012

    Short-term borrowings        1,210,053     14,738   2.44%    1,313,970
    Long-term debt                 761,992     17,598   4.64%      613,439
                                ----------  ---------  ------   ----------

    Total Interest-bearing
     Liabilities                 8,419,629     91,248   2.18%    7,688,421

Noninterest-bearing liabilities:
    Demand deposits              1,538,526                       1,322,155
    Other                          133,554                         103,785
                                ----------                      ----------

    Total Liabilities           10,091,709                       9,114,361

    Shareholders' equity         1,222,511                       1,025,658
                                ----------                      ----------

    Total Liabilities and
     Shareholders' Equity      $11,314,220                     $10,140,019
                                ==========                      ==========

    Net interest
     income/net interest
     margin (fully
     taxable equivalent)           202,858              3.94%
                                                      =======

    Tax equivalent adjustment       (4,685)
                                ----------

    Net interest income          $ 198,173
                                ==========

    (1) Presented on a tax-equivalent basis using a 35% Federal tax rate.


FULTON FINANCIAL CORPORATION
AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)


                                                 Six Months Ended June 30

                                                        ------------------
                                                                2004
                                                        ------------------
                                                        Interest   Rate (1)
                                                        -------    -------
                                                     (dollars in thousands)
ASSETS

Interest-earning assets:
    Loans and leases                                  $ 187,000      5.72%
    Taxable investment securities                        41,388      3.49%
    Tax-exempt investment securitites                     7,631      5.56%
    Equity securities                                     2,389      3.56%
                                                        -------    -------

    Total Investment Securities                          51,408      3.70%

    Mortgage loans held for sale                          2,201      6.73%
    Short-term investments                                   29      1.12%
                                                        -------    -------

    Total Interest-earning Assets                       240,638      5.14%

Noninterest-earning assets:
    Cash and due from banks
    Premises and equipment
    Other assets
    Less: allowance for loan losses

    Total Assets


LIABILITIES AND SHAREHOLDERS' EQUITY

Interest-bearing liabilities:
    Demand deposits                                     $ 2,989      0.46%
    Savings deposits                                      5,143      0.57%
    Time deposits                                        34,563      2.64%
                                                        -------    -------

    Total Interest-bearing Deposits                      42,695      1.49%

    Short-term borrowings                                 6,462      0.98%
    Long-term debt                                       15,130      4.85%
                                                        -------    -------

    Total Interest-bearing Liabilities                   64,287      1.67%

Noninterest-bearing liabilities:
    Demand deposits
    Other

    Total Liabilities

    Shareholders' equity

    Total Liabilities and Shareholders' Equity

    Net interest income/net interest
     margin (fully
     taxable equivalent)                                176,351      3.76%
                                                                   =======
    Tax equivalent adjustment                            (4,678)
                                                        -------


    Net interest income                               $ 171,673
                                                        =======

    (1) Presented on a tax-equivalent basis using a 35% Federal tax rate.


FULTON FINANCIAL CORPORATION
CONSOLIDATED ENDING BALANCE SHEET (UNAUDITED)

                                 Quarter Ended              Variance
                              June 30     March 31
                               2005        2005          $              %
                        -----------  -----------  -----------   ----------
                                     (in thousands)
ASSETS
  Cash and due from
   banks                $   358,581  $   336,039  $    22,542          6.7%
  Loans held for sale       237,713      163,004       74,709         45.8%
  Other
   interest-earning
   assets                    22,600       84,123      (61,523)       -73.1%
  Investment
   securities             2,429,365    2,385,358       44,007          1.8%
  Loans, net of
   allowance              7,771,106    7,657,174      113,932          1.5%
  Premises and
   equipment                153,598      149,492        4,106          2.7%
  Accrued interest
   receivable                43,819       42,214        1,605          3.8%
  Goodwill and
   intangible assets        386,795      388,260       (1,465)        -0.4%
  Other assets              167,506      212,614      (45,108)       -21.2%
                        -----------  -----------  -----------
    Total Assets        $11,571,083  $11,418,278  $   152,805          1.3%
                        ===========  ===========  ===========

LIABILITIES AND
 SHAREHOLDERS' EQUITY

  Deposits              $ 8,139,667  $ 7,981,147  $   158,520          2.0%
  Short-term
   borrowings             1,134,583    1,265,360     (130,777)       -10.3%
  Long-term debt            951,745      773,129      178,616         23.1%
  Other liabilities         151,013      163,123      (12,110)        -7.4%
                        -----------  -----------  -----------
    Total Liabilities    10,377,008   10,182,759      194,249          1.9%
                        -----------  -----------  -----------
  Shareholders' equity    1,194,075    1,235,519      (41,444)        -3.4%
                        -----------  -----------  -----------
    Total Liabilities
     and Shareholders'
     Equity             $11,571,083  $11,418,278  $   152,805          1.3%
                        ===========  ===========  ===========

LOANS AND DEPOSITS
 DETAIL:
Loans, by type:
  Commercial -
   industrial and
   financial             $1,991,480  $ 1,975,981  $    15,499          0.8%
  Commercial -
   agricultural             322,791      319,647        3,144          1.0%
  Real estate -
   commercial
   mortgage               2,556,990    2,540,554       16,436          0.6%
  Real estate -
   residential
   mortgage                 558,845      556,966        1,879          0.3%
  Real estate -
   construction             743,774      690,325       53,449          7.7%
  Real estate -
   home equity            1,141,749    1,110,126       31,623          2.8%
  Consumer                  485,492      496,031      (10,539)        -2.1%
  Leasing and other          60,387       57,671        2,716          4.7%
                        -----------  -----------  -----------
  Total Loans, net
   of unearned income   $ 7,861,508  $ 7,747,301  $   114,207          1.5%
                        ===========  ===========  ===========

Deposits, by type:
  Noninterest-bearing
   demand               $1,611,909   $ 1,579,400  $    32,509          2.1%
  Interest-bearing
   demand                1,471,398     1,479,124       (7,726)        -0.5%
  Savings deposits       1,965,523     1,916,942       48,581          2.5%
  Time deposits          3,090,837     3,005,681       85,156          2.8%
                        -----------  -----------  -----------
  Total Deposits        $8,139,667   $ 7,981,147  $   158,520          2.0%
                        ===========  ===========  ===========


FULTON FINANCIAL CORPORATION
CONSOLIDATED INCOME STATEMENT (UNAUDITED)

                                      Quarter Ended          Variance
                                   June 30   March 31
                                     2005      2005        $          %
                                 --------   --------   --------   --------
                                          (in thousands)

Interest Income:
  Loans, including fees          $123,309   $116,628   $  6,681        5.7%
  Investment securities:
    Taxable                        18,257     18,261         (4)       0.0%
    Tax-exempt                      2,843      2,849         (6)      -0.2%
    Dividends                       1,155      1,084         71        6.5%
  Loans held for sale               2,699      1,812        887       49.0%
  Other interest income               348        176        172       97.7%
                                 --------   --------   --------
    Total Interest Income         148,611    140,810      7,801        5.5%

Interest Expense:
  Deposits                         31,104     27,808      3,296       11.9%
  Short-term borrowings             7,914      6,824      1,090       16.0%
  Long-term debt                    9,668      7,930      1,738       21.9%
                                 --------   --------   --------
    Total Interest Expense         48,686     42,562      6,124       14.4%
                                 --------   --------   --------
    Net Interest Income            99,925     98,248      1,677        1.7%
  Provision for Loan Losses           725        800        (75)      -9.4%
                                 --------   --------   --------
    Net Interest Income
     after Provision               99,200     97,448      1,752        1.8%

Other Income:
  Investment management
   and trust services               8,966      9,019        (53)      -0.6%
  Service charges on deposit
   accounts                         9,960      9,332        628        6.7%
  Other service charges
   and fees                         7,142      5,556      1,586       28.5%
  Gain on sale of
   mortgage loans                   6,290      6,049        241        4.0%
  Investment securities
   gains                            1,418      3,315     (1,897)     -57.2%
  Other                             4,539      2,582      1,957       75.8%
                                 --------   --------   --------
    Total Other Income             38,315     35,853      2,462        6.9%
Other Expenses:
  Salaries and employee
   benefits                        45,152     44,201        951        2.2%
  Net occupancy expense             6,549      7,498       (949)     -12.7%
  Equipment expense                 2,888      3,070       (182)      -5.9%
  Data processing                   3,321      3,169        152        4.8%
  Advertising                       2,276      1,973        303       15.4%
  Intangible amortization           1,168      1,179        (11)      -0.9%
  Other                            16,752     12,641      4,111       32.5%
                                 --------   --------   --------
    Total Other Expenses           78,106     73,731      4,375        5.9%
                                 --------   --------   --------
    Income Before Income Taxes     59,409     59,570       (161)      -0.3%
  Income Taxes                     17,829     18,039       (210)      -1.2%
                                 --------   --------   --------
    Net Income                   $ 41,580   $ 41,531        $49        0.1%
                                 ========   ========   ========

SHARE AND PER-SHARE
 INFORMATION:
  Net income:
    Basic                        $   0.27   $   0.26   $   0.01        3.8%
    Diluted                          0.27       0.26       0.01        3.8%

  Cash dividends                 $  0.145   $  0.132   $  0.013        9.8%
  Book value                         7.81       7.85      (0.04)      -0.5%
  Tangible book value                5.28       5.38      (0.10)      -1.9%
  Weighted average shares
   (basic)                        154,509    157,351     (2,842)      -1.8%
  Weighted average shares
   (diluted)                      156,230    159,289     (3,059)      -1.9%
  Shares outstanding,
   end of period                  152,956    157,340     (4,384)      -2.8%

SELECTED FINANCIAL RATIOS:

  Return on average assets           1.46%      1.50%
  Return on average equity          13.95%     13.48%
  Return on average equity
   (tangible)                       20.64%     19.56%
  Net interest margin                3.92%      3.95%
  Efficiency ratio                   55.3%      54.5%
  Average equity to average
   assets                            10.5%      11.1%


FULTON FINANCIAL CORPORATION
AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)

                                        Quarter Ended
                                        June 30, 2005
                      Balance       Interest      Rate (1)      Balance
                    ------------  ------------  ------------  ------------
ASSETS                              (dollars in thousands)

Interest-earning
 assets:
  Loans and leases  $  7,823,737  $    124,080          6.36% $  7,675,034
  Taxable investment
   securities          1,965,683        18,257          3.71%    1,983,864
  Tax-exempt
   investment
   securitites           341,044         4,227          4.96%      335,355
  Equity securities      129,980         1,341          4.14%      123,800
                    ------------  ------------  ------------  ------------

  Total Investment
   Securities          2,436,707        23,825          3.91%    2,443,019

  Mortgage loans
   held for sale         152,502         2,699          7.08%      112,619
  Short-term
   investments            47,819           348          2.90%       28,699
                    ------------  ------------  ------------  ------------

  Total Interest-
   earning Assets     10,460,765       150,952          5.79%   10,259,371

Noninterest-earning
 assets:
  Cash and due from
   banks                 342,592                                   322,793
  Premises and
   equipment             152,123                                   149,017
  Other assets           552,807                                   569,527
  Less: allowance
   for loan losses       (91,209)                                  (90,489)
                    ------------                              ------------

  Total Assets      $ 11,417,078                              $ 11,210,219
                    ============                              ============


LIABILITIES AND
 SHAREHOLDERS'
 EQUITY

Interest-bearing
 liabilities:
  Demand deposits   $  1,484,772  $      3,309          0.89% $  1,494,984
  Savings deposits     1,986,909         5,859          1.18%    1,911,820
  Time deposits        3,019,818        21,936          2.91%    2,996,377
                    ------------  ------------  ------------  ------------

  Total Interest-
   bearing Deposits    6,491,499        31,104          1.92%    6,403,181

  Short-term
   borrowings          1,180,975         7,914          2.68%    1,239,454
  Long-term debt         841,650         9,668          4.59%      681,450
                    ------------  ------------  ------------  ------------

  Total Interest-
   bearing
   Liabilities         8,514,124        48,686          2.29%    8,324,085

Noninterest-bearing
 liabilities:
  Demand deposits      1,567,611                                 1,509,118
  Other                  139,888                                   127,148
                    ------------                              ------------

  Total Liabilities   10,221,623                                 9,960,351

  Shareholders'
   equity              1,195,455                                 1,249,868
                    ------------                              ------------

  Total Liabilities
   and Shareholders'
   Equity           $ 11,417,078                              $ 11,210,219
                    ============                              ============

  Net interest
   income/net
   interest margin
   (fully taxable
   equivalent)                         102,266          3.92%
                                                ============

  Tax equivalent
   adjustment                           (2,341)
                                  ------------

  Net interest
   income                         $     99,925
                                  ============


                           Quarter Ended
                          March 31, 2005
                      Interest      Rate (1)
                    ------------  ------------
ASSETS                (dollars in thousands)

Interest-earning
 assets:
  Loans and leases  $    117,389          6.19%
  Taxable investment
   securities             18,261          3.68%
  Tax-exempt
   investment
   securitites             4,246          5.07%
  Equity securities        1,270          4.13%
                    ------------  ------------

  Total Investment
   Securities             23,777          3.89%

  Mortgage loans
   held for sale           1,812          6.43%
  Short-term
   investments               176          2.48%
                    ------------  ------------

  Total Interest-
   earning Assets        143,154          5.64%

Noninterest-earning
 assets:
  Cash and due from
   banks
  Premises and
   equipment
  Other assets
  Less: allowance
   for loan losses

  Total Assets


LIABILITIES AND
 SHAREHOLDERS'
 EQUITY

Interest-bearing
 liabilities:
  Demand deposits   $      2,970          0.81%
  Savings deposits         4,466          0.95%
  Time deposits           20,372          2.76%
                    ------------  ------------

  Total Interest-
   bearing Deposits       27,808          1.76%

  Short-term
   borrowings              6,824          2.23%
  Long-term debt           7,930          4.72%
                    ------------  ------------

  Total Interest-
   bearing
   Liabilities            42,562          2.07%

Noninterest-bearing
 liabilities:
  Demand deposits
  Other

  Total Liabilities

  Shareholders'
   equity

  Total Liabilities
   and Shareholders'
   Equity

  Net interest
   income/net
   interest margin
   (fully taxable
   equivalent)           100,592          3.95%
                                  ============

  Tax equivalent
   adjustment             (2,344)
                    ------------

  Net interest
   income           $     98,248
                    ============

(1) Presented on a tax-equivalent basis using a 35% Federal tax rate.

FULTON FINANCIAL CORPORATION
ASSET QUALITY INFORMATION (UNAUDITED)

                                   Quarter Ended        Six Months Ended
                                      June 30               June 30
                                   2005     2004        2005       2004
                                 -------    -------   -------     -------
                                         (dollars in thousands)

Gross charge-offs                $ 1,660    $ 1,627   $ 3,479     $ 4,315
Recoveries                         1,210      1,183     2,729       2,702
                                 -------    -------   -------     -------

   Net Charge-offs               $   450    $   444   $   750     $ 1,613
                                 =======    =======   =======     =======

Net charge-offs to
 average loans                      0.02%      0.03%     0.02%       0.05%
                                 -------    -------   -------     -------


Non-accrual loans                $20,820    $21,961
Accruing loans 90+
 days overdue                      7,453      9,314
Other real estate owned            3,478      1,119
                                 -------    -------

   Total Non-Performing Assets   $31,751    $32,394
                                 =======    =======

Non-accrual loans to total loans    0.26%      0.31%
Non-performing assets to
 total loans and OREO               0.40%      0.46%
Non-performing assets to
 total assets                       0.27%      0.31%
Allowance for loan losses to
 loans outstanding                  1.15%      1.23%


                                     Quarter Ended
                                 June 30      March 31
                                   2005         2005
                                 -------     -------
                                (dollars in thousands)

Gross charge-offs                $ 1,660     $ 1,819
Recoveries                         1,210       1,519
                                 -------     -------

   Net Charge-offs               $   450     $   300
                                 =======     =======

Net charge-offs to average loans    0.02%       0.02%
                                 -------     -------


Non-accrual Loans                $20,820     $19,232
Accruing loans 90+ days overdue    7,453       6,545
Other real estate owned            3,478       3,244
                                 -------     -------

   Total Non-Performing Assets   $31,751     $29,021
                                 =======     =======

Non-accrual loans to
 total loans                        0.26%       0.25%
Non-performing assets to
 total loans and OREO               0.40%       0.37%
Non-performing assets to
 total assets                       0.27%       0.25%
Allowance for loan losses to
 loans outstanding                  1.15%       1.16%

Contact Information

  • Contact:
    Laura J. Wakeley
    Office: 717-291-2739