SOURCE: Fulton Financial Corporation

Fulton Financial Corporation

April 21, 2009 16:30 ET

Fulton Financial Reports First Quarter Earnings

LANCASTER, PA--(Marketwire - April 21, 2009) - Fulton Financial Corporation (NASDAQ: FULT) reported net income available to common shareholders of $8.1 million for the first quarter ended March 31, 2009, an 80.6 percent decrease from the same period in 2008. Diluted net income per share for the quarter was 5 cents, a 79.2 percent decrease from the same period in 2008. Total assets at March 31, 2009 were approximately $16.5 billion.

The decrease in net income available to common shareholders and diluted net income per share was mainly due to a $38.8 million increase in the provision for loan losses and $5.0 million of dividends and discount accretion on the preferred stock issued to the United States Treasury under the Capital Purchase Program.

A comparison of the Corporation's earnings for the first quarter of 2009 to the fourth quarter of 2008 is impacted by a number of significant items. A detail of these items and their impact on the Corporation's earnings for each period is included in the supplemental financial information that appears below.

"Despite experiencing good deposit growth and very strong mortgage refinancing activity, first quarter earnings were slowed by credit related charges," said R. Scott Smith Jr., chairman and chief executive officer. "Our noninterest income was up significantly due to secondary market mortgage sale gains. In addition, our ongoing promotional efforts led to particularly strong certificate of deposit growth. However, the relatively higher funding costs associated with that growth, combined with lower earning asset yields, negatively impacted our net interest margin. We continue to address our credit challenges while closely monitoring expenses and positioning the company to produce stronger earnings as economic conditions improve. Our capital position remains strong."

Loans, net of unearned income, increased $620.4 million, or 5.4 percent, to $12.0 billion at March 31, 2009, compared to $11.4 billion at March 31, 2008. The increase was due to a $471.0 million, or 13.1 percent, increase in commercial mortgages, a $160.2 million, or 4.6 percent, increase in commercial loans, a $126.3 million, or 8.2 percent, increase in home equity loans and a $68.3 million, or 7.8 percent, increase in residential mortgages. These increases were offset by a $123.5 million, or 9.3 percent, decrease in construction loans and a $72.2 million, or 16.0 percent, decrease in consumer loans.

Non-performing assets were $269.2 million, or 1.63 percent of total assets, at March 31, 2009, compared to $144.7 million, or 0.90 percent, at March 31, 2008 and $219.0 million, or 1.35 percent, at December 31, 2008. The prolonged economic downturn continued to negatively impact the Corporation's loan portfolio. The $124.6 million, or 86.1 percent, increase in non-performing assets since March 31, 2008 was primarily due to a $65.3 million, or 231.8 percent, increase in non-performing construction loans, a $29.7 million, or 98.6 percent, increase in non-performing commercial mortgage loans and a $15.0 million, or 42.4 percent, increase in non-performing commercial loans.

Annualized net charge-offs for the quarter ended March 31, 2009 were 1.0 percent of average total loans, compared to 0.15 percent for the quarter ended March 31, 2008 and 0.89 percent for the quarter ended December 31, 2008. The increase in net charge-offs for the first quarter of 2009 in comparison to the same period in 2008 was primarily in construction loans and commercial mortgages. The provision for loan losses increased $38.8 million for the first quarter of 2009, as compared to the same period in 2008, and decreased $15.0 million from the fourth quarter of 2008. The increase in the provision for loan losses in comparison to the first quarter of 2008 was mainly due to the increase in the level of non-performing assets, which required additional increases to the allowance for credit losses.

Total deposits increased $1.4 billion, or 13.6 percent, to $11.4 billion at March 31, 2009 compared to $10.0 billion at March 31, 2008. The increase was due to a $1.3 billion, or 28.6 percent, increase in time deposits and a $93.3 million, or 1.7 percent, increase in demand and savings deposits. In comparison to the fourth quarter of 2008, total deposits increased $862.1 million, or 8.2 percent, due to a $614.8 million, or 12.1 percent, increase in time deposits and a $247.3 million, or 4.5 percent, increase in demand and savings deposits.

Net interest income for the first quarter decreased $1.8 million, or 1.4 percent, compared to the first quarter of 2008 and decreased $8.2 million, or 6.2 percent, from the fourth quarter of 2008. The Corporation's net interest margin was 3.45 percent for the first quarter of 2009, 3.58 percent for the first quarter of 2008 and 3.68 percent for fourth quarter of 2008.

Other income, excluding investment securities gains, increased $7.6 million, or 20.8 percent, in the first quarter of 2009 compared to the same period in 2008. The increase was primarily due to a $6.3 million, or 271.7 percent, increase in gains on sale of mortgage loans due to increased volumes of loans sold, as refinance activity grew in the current low mortgage interest rate environment. Also contributing to the increase was $1.2 million of credit card fee income earned under a joint marketing agreement executed with the purchaser of the Corporation's credit card portfolio in April of 2008 and a $927,000, or 6.6 percent, increase in service charges on deposit accounts. These increases were offset by an $856,000, or 9.8 percent, decrease in investment management and trust services income. Compared to the fourth quarter of 2008, other income, excluding securities gains (losses), increased $5.2 million, or 13.5 percent, due to a $5.5 million, or 178.5 percent, increase in gains on sale of mortgage loans, offset by a $1.3 million, or 7.9 percent, decrease in service charges on deposit accounts.

Investment securities gains increased $1.7 million, or 134.3 percent, in the first quarter of 2009 compared to the same period in 2008. Investment securities gains in the first quarter of 2009 included $6.1 million of net gains on the sale of debt securities, offset by $2.0 million of other-than-temporary impairment charges related to debt securities issued by financial institutions in the form of pooled trust preferred securities and $956,000 of other-than-temporary impairment charges related to bank stocks. Investment securities gains in the first quarter of 2008 included gains of $3.6 million from the redemption of Class B shares of Visa, Inc. (Visa) in connection with Visa's initial public offering and $1.0 million from the sale of Mastercard, Inc. shares, offset by $3.6 million in other-than-temporary impairment charges related to bank stocks. Investment securities losses for the fourth quarter of 2008 included $12.9 million of other-than-temporary impairment charges related to bank stocks and $12.8 million of other-than-temporary impairment charges related to debt securities issued by financial institutions in the form of pooled trust preferred securities.

Other expenses increased $9.7 million, or 10.0 percent, compared to the same period in 2008. The increase was primarily due to $6.2 million of charges to increase the Corporation's guarantee liability associated with the decision to purchase illiquid auction rate securities previously sold to customers of the Corporation's investment management and trust subsidiary, Fulton Financial Advisors, N.A. Also contributing to the increase in other expenses was a $3.4 million, or 397.4 percent, increase in Federal Deposit Insurance Corporation insurance premiums due to an increase in assessment rates and a $1.4 million increase related to the reversal of legal reserves in the first quarter of 2008 associated with the initial public offering of Visa. Compared to the fourth quarter of 2008, other expenses, excluding goodwill impairment charges, increased $5.5 million, or 5.5 percent.

Fulton Financial Corporation is a Lancaster, Pennsylvania-based financial holding company which has nearly 3,900 employees and operates more than 265 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 Company, Hagerstown, MD; Delaware National Bank, Georgetown, DE; The Bank, Woodbury, NJ; The Peoples Bank of Elkton, Elkton, MD; Skylands Community Bank, Hackettstown, NJ 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.

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," "intends," "forecasts," "projects," "will" and similar words and expressions are used in its press releases, 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; changes or adverse developments in economic, political or regulatory conditions; a continuation or worsening of the current disruption in credit and other markets, including the lack of or reduced access to, and the abnormal functioning of, markets for mortgage and other asset-backed securities and for commercial paper and other short-term borrowings; the effect of competition and interest rates on net interest margin and net interest income; investment strategy and income growth; investment securities gains; declines in the value of securities which may result in charges to earnings; changes in rates of deposit and loan growth; asset quality and the impact on assets from adverse changes in the economy and in credit and other markets and resulting effects on credit risk and asset values; balances of risk-sensitive assets to risk-sensitive liabilities; salaries and 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" set forth in the Corporation's filings with the Securities and Exchange Commission.

2009

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


                                               March 31
                                      --------------------------
BALANCE SHEET DATA                        2009          2008      % Change
                                      ------------  ------------  --------

Total assets                          $ 16,493,522  $ 16,052,867       2.7%
Loans, net of unearned income           12,009,060    11,388,653       5.4%
Investment securities                    3,123,687     3,104,827       0.6%
Deposits                                11,413,982    10,048,928      13.6%
Shareholders' equity                     1,861,321     1,611,720      15.5%



                                        Quarter Ended March 31
                                      --------------------------
INCOME SUMMARY                            2009          2008      % Change
                                      ------------  ------------  --------

Interest income                       $    195,567  $    229,220    (14.7%)
Interest expense                           (71,451)     (103,321)   (30.8%)
                                      ------------  ------------
  Net interest income                      124,116       125,899     (1.4%)
Provision for loan losses                  (50,000)      (11,220)   345.6%
Investment securities gains                  2,919         1,246    134.3%
Other income                                43,995        36,434     20.8%
Other expenses                            (106,372)      (96,660)    10.0%
                                      ------------  ------------
  Income before income taxes                14,658        55,699    (73.7%)
Income tax expense                          (1,573)      (14,203)   (88.9%)
                                      ------------  ------------
  Net income                                13,085        41,496    (68.5%)
Preferred stock dividends and
 discount accretion                         (5,031)            -       N/A
                                      ------------  ------------
  Net income available to common
   shareholders                       $      8,054  $     41,496    (80.6%)
                                      ============  ============

PER COMMON SHARE:

Net income:
     Basic                            $       0.05  $       0.24    (79.2%)
     Diluted                                  0.05          0.24    (79.2%)
Cash dividends                                0.03          0.15    (80.0%)

Shareholders' equity                          8.50          9.28     (8.4%)
Shareholders' equity (tangible)               5.33          5.52     (3.4%)

SELECTED FINANCIAL RATIOS:

Return on average assets                      0.33%         1.05%
Return on average common
 shareholders' equity                         2.84%        10.53%
Return on average common
 shareholders' equity (tangible)              3.88%        18.45%
Net interest margin                           3.45%         3.58%
Efficiency ratio                             60.95%        57.10%
Non-performing assets to total assets         1.63%         0.90%


N/A - Not applicable






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


                                    March 31      March 31    December 31
                                      2009          2008          2008
                                  ------------  ------------  ------------

ASSETS
  Cash and due from banks         $    265,431  $    406,601  $    331,164
  Loans held for sale                  102,033        95,144        95,840
  Other interest-earning assets         14,329        13,240        21,710
  Investment securities              3,123,687     3,104,827     2,724,841
  Loans, net of unearned income     12,009,060    11,388,653    12,042,620
  Allowance for loan losses           (192,410)     (115,257)     (173,946)
                                  ------------  ------------  ------------
       Net Loans                    11,816,650    11,273,396    11,868,674
  Premises and equipment               205,495       197,424       202,657
  Accrued interest receivable           59,369        65,865        58,566
  Goodwill and intangible assets       556,496       653,038       557,833
  Other assets                         350,032       243,332       323,821
                                  ------------  ------------  ------------
       Total Assets               $ 16,493,522  $ 16,052,867  $ 16,185,106
                                  ============  ============  ============

LIABILITIES AND SHAREHOLDERS'
 EQUITY
  Deposits                        $ 11,413,982  $ 10,048,928  $ 10,551,916
  Short-term borrowings              1,195,474     2,229,127     1,762,770
  Federal Home Loan Bank advances
   and long-term debt                1,786,598     1,890,969     1,787,797
  Other liabilities                    236,147       272,123       222,976
                                  ------------  ------------  ------------
     Total Liabilities              14,632,201    14,441,147    14,325,459
  Preferred stock                      369,270             -       368,944
  Common shareholders' equity        1,492,051     1,611,720     1,490,703
                                  ------------  ------------  ------------
     Total Shareholders' Equity      1,861,321     1,611,720     1,859,647
                                  ------------  ------------  ------------
       Total Liabilities and
        Shareholders' Equity      $ 16,493,522  $ 16,052,867  $ 16,185,106
                                  ============  ============  ============

LOANS, DEPOSITS AND SHORT-TERM
 BORROWINGS DETAIL:
Loans, by type:
  Real estate - commercial
   mortgage                       $  4,068,342  $  3,597,307  $  4,016,700
  Commercial - industrial,
   financial and agricultural        3,653,503     3,493,352     3,635,544
  Real estate - home equity          1,673,613     1,547,323     1,695,398
  Real estate - construction         1,205,256     1,328,802     1,269,330
  Real estate - residential
   mortgage                            947,837       879,491       972,797
  Consumer                             378,851       451,037       365,692
  Leasing and other                     81,658        91,341        87,159
                                  ------------  ------------  ------------
  Total Loans, net of unearned
   income                         $ 12,009,060  $ 11,388,653  $ 12,042,620
                                  ============  ============  ============
Deposits, by type:
  Noninterest-bearing demand      $  1,776,169  $  1,737,442  $  1,653,440
  Interest-bearing demand            1,799,586     1,712,601     1,789,833
  Savings deposits                   2,125,297     2,157,749     2,010,526
  Time deposits                      5,712,930     4,441,136     5,098,117
                                  ------------  ------------  ------------
  Total Deposits                  $ 11,413,982  $ 10,048,928  $ 10,551,916
                                  ============  ============  ============
Short-term borrowings, by type:
  Federal funds purchased         $    397,158  $  1,103,804  $  1,147,673
  Short-term promissory notes          343,845       496,706       356,788
  Customer repurchase agreements       249,256       223,649       255,796
  Federal Reserve Bank borrowings      200,000             -             -
  Overnight borrowings and other         5,215       404,968         2,513
                                  ------------  ------------  ------------
  Total Short-term borrowings     $  1,195,474  $  2,229,127  $  1,762,770
                                  ============  ============  ============



                                        % Change from
                                  --------------------------
                                    March 31    December 31
                                      2008          2008
                                  ------------  ------------

ASSETS
  Cash and due from banks               (34.7%)       (19.8%)
  Loans held for sale                     7.2%          6.5%
  Other interest-earning assets           8.2%        (34.0%)
  Investment securities                   0.6%         14.6%
  Loans, net of unearned income           5.4%         (0.3%)
  Allowance for loan losses              66.9%         10.6%
       Net Loans                          4.8%         (0.4%)
  Premises and equipment                  4.1%          1.4%
  Accrued interest receivable            (9.9%)         1.4%
  Goodwill and intangible assets        (14.8%)        (0.2%)
  Other assets                           43.8%          8.1%
       Total Assets                       2.7%          1.9%

LIABILITIES AND SHAREHOLDERS'
 EQUITY
  Deposits                               13.6%          8.2%
  Short-term borrowings                 (46.4%)       (32.2%)
  Federal Home Loan Bank advances
   and long-term debt                    (5.5%)        (0.1%)
  Other liabilities                     (13.2%)         5.9%
     Total Liabilities                    1.3%          2.1%
  Preferred stock                          N/A          0.1%
  Common shareholders' equity            (7.4%)         0.1%
     Total Shareholders' Equity          15.5%          0.1%
       Total Liabilities and
        Shareholders' Equity              2.7%          1.9%

LOANS, DEPOSITS AND SHORT-TERM
 BORROWINGS DETAIL:
Loans, by type:
  Real estate - commercial
   mortgage                              13.1%          1.3%
  Commercial - industrial,
   financial and agricultural             4.6%          0.5%
  Real estate - home equity               8.2%         (1.3%)
  Real estate - construction             (9.3%)        (5.0%)
  Real estate - residential
   mortgage                               7.8%         (2.6%)
  Consumer                              (16.0%)         3.6%
  Leasing and other                     (10.6%)        (6.3%)
  Total Loans, net of unearned
   income                                 5.4%         (0.3%)
Deposits, by type:
  Noninterest-bearing demand              2.2%          7.4%
  Interest-bearing demand                 5.1%          0.5%
  Savings deposits                       (1.5%)         5.7%
  Time deposits                          28.6%         12.1%
  Total Deposits                         13.6%          8.2%
Short-term borrowings, by type:
  Federal funds purchased               (64.0%)       (65.4%)
  Short-term promissory notes           (30.8%)        (3.6%)
  Customer repurchase agreements         11.4%         (2.6%)
  Federal Reserve Bank borrowings          N/A           N/A
  Overnight borrowings and other        (98.7%)       107.5%
  Total Short-term borrowings           (46.4%)       (32.2%)


N/A - Not Applicable





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

                                Quarter Ended              % Change from
                      ---------------------------------  -----------------
                                                          March   December
                      March 31   March 31   December 31     31       31
                        2009       2008         2008       2008     2008
                      ---------  ---------  -----------  -------  --------

Interest Income:
  Interest income     $ 195,567  $ 229,220  $   209,073   (14.7%)    (6.5%)
  Interest expense       71,451    103,321       76,732   (30.8%)    (6.9%)
                      ---------  ---------  -----------
    Net Interest
     Income             124,116    125,899      132,341    (1.4%)    (6.2%)
  Provision for loan
   losses                50,000     11,220       65,000    345.6%   (23.1%)
                      ---------  ---------  -----------
    Net Interest
     Income after
     Provision           74,116    114,679       67,341    (35.4%)   10.1%
Other Income:
  Service charges on
   deposit accounts      14,894     13,967       16,177      6.6%    (7.9%)
  Gains on sale of
   mortgage loans         8,591      2,311        3,085    271.7%   178.5%
  Other service
   charges and fees       8,354      8,591        8,927     (2.8%)   (6.4%)
  Investment
   management and
   trust services         7,903      8,759        7,541     (9.8%)    4.8%
  Investment
   securities gains
   (losses)               2,919      1,246      (28,339)   134.3%   110.3%
  Other                   4,253      2,806        3,020     51.6%    40.8%
                      ---------  ---------  -----------
    Total Other
     Income              46,914     37,680       10,411     24.5%   350.6%
Other Expenses:
  Salaries and
   employee benefits     55,304     55,195       48,771      0.2%    13.4%
  Net occupancy
   expense               11,023     10,524       11,240      4.7%    (1.9%)
  Operating risk loss     6,201      1,243        5,200    398.9%    19.3%
  FDIC insurance
   premiums               4,288        862        1,878    397.4%   128.3%
  Equipment expense       3,079      3,448        3,425    (10.7%)  (10.1%)
  Data processing         3,072      3,246        3,209     (5.4%)   (4.3%)
  Marketing               2,571      2,905        3,746    (11.5%)  (31.4%)
  Intangible
   amortization           1,463      1,857        1,776    (21.2%)  (17.6%)
  Goodwill impairment         -          -       90,000       N/A      N/A
  Other                  19,371     17,380       21,629     11.5%   (10.4%)
                      ---------  ---------  -----------
    Total Other
     Expenses           106,372     96,660      190,874     10.0%   (44.3%)
                      ---------  ---------  -----------
    Income (Loss)
     Before Income
     Taxes               14,658     55,699     (113,122)   (73.7%) (113.0%)
  Income tax expense
   (benefit)              1,573     14,203      (11,255)   (88.9%) (114.0%)
                      ---------  ---------  -----------
    Net Income (Loss)    13,085     41,496     (101,867)   (68.5%) (112.8%)
  Preferred stock
   dividends and
   discount accretion    (5,031)         -         (463)      N/A  (986.6%)
                      ---------  ---------  -----------
    Net Income (Loss)
     Available to
     Common
     Shareholders     $   8,054  $  41,496  $  (102,330)   (80.6%) (107.9%)
                      =========  =========  ===========

PER COMMON SHARE:
  Net income (loss):
    Basic             $    0.05  $    0.24  $     (0.58)   (79.2%) (108.6%)
    Diluted                0.05       0.24        (0.58)   (79.2%) (108.6%)

  Cash dividends      $    0.03  $    0.15  $      0.15    (80.0%)  (80.0%)
  Shareholders'
   equity                  8.50       9.28         8.52     (8.4%)   (0.2%)
  Shareholders'
   equity (tangible)       5.33       5.52         5.33     (3.4%)       -

  Weighted average
   shares (basic)       175,315    173,624      174,889      1.0%     0.2%
  Weighted average
   shares (diluted)     175,548    174,209      174,889      0.8%     0.4%
  Shares outstanding,
   end of period        175,507    173,722      175,044      1.0%     0.3%

SELECTED FINANCIAL
 RATIOS:
  Return on average
   assets                  0.33%      1.05%       (2.51%)
  Return on average
   common
   shareholders'
   equity                  2.84%     10.53%      (24.89%)
  Return on average
   common
   shareholders'
   equity (tangible)       3.88%     18.45%       (4.35%)
  Net interest margin      3.45%      3.58%        3.68%
  Efficiency ratio        60.95%     57.10%       56.57%


N/A - Not applicable





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


                                               Quarter Ended
                                  ----------------------------------------
                                               March 31, 2009
                                  ----------------------------------------
                                    Average                      Yield/
                                    Balance     Interest (1)      Rate
                                  ------------  ------------  ------------
ASSETS
Interest-earning assets:
  Loans, net of unearned income   $ 12,041,286  $    163,753          5.51%
  Taxable investment securities      2,212,639        26,849          4.86%
  Tax-exempt investment
   securities                          503,265         6,887          5.47%
  Equity securities                    137,308           774          2.28%
                                  ------------  ------------  ------------
  Total Investment Securities        2,853,212        34,510          4.84%
  Loans held for sale                  104,467         1,261          4.83%
  Other interest-earning assets         16,934            50          1.19%
                                  ------------  ------------  ------------
  Total Interest-earning Assets     15,015,899       199,574          5.38%
Noninterest-earning assets:
  Cash and due from banks              317,928
  Premises and equipment               202,875
  Other assets                         924,755
  Less: allowance for loan losses     (187,183)
                                  ------------
  Total Assets                    $ 16,274,274
                                  ============


LIABILITIES AND SHAREHOLDERS'
 EQUITY
Interest-bearing liabilities:
  Demand deposits                 $  1,754,003  $      1,776          0.41%
  Savings deposits                   2,058,021         4,353          0.86%
  Time deposits                      5,432,676        43,767          3.27%
                                  ------------  ------------  ------------
  Total Interest-bearing Deposits    9,244,700        49,896          2.19%
  Short-term borrowings              1,517,064         1,436          0.38%
  Federal Home Loan Bank advances
   and long-term debt                1,787,493        20,119          4.55%
                                  ------------  ------------  ------------
  Total Interest-bearing
   Liabilities                      12,549,257        71,451          2.31%
Noninterest-bearing liabilities:
  Demand deposits                    1,657,658
  Other                                201,449
                                  ------------
  Total Liabilities                 14,408,364
  Shareholders' equity               1,865,910
                                  ------------
  Total Liabilities and
   Shareholders' Equity           $ 16,274,274
                                  ============

  Net interest income/net
   interest margin (fully taxable
   equivalent)                                       128,123          3.45%
                                                              ============
  Tax equivalent adjustment                           (4,007)
                                                ------------
  Net interest income                           $    124,116
                                                ============


                                               Quarter Ended
                                  ----------------------------------------
                                               March 31, 2008
                                  ----------------------------------------
                                    Average                      Yield/
                                    Balance     Interest (1)      Rate
                                  ------------  ------------  ------------
ASSETS
Interest-earning assets:
  Loans, net of unearned income   $ 11,295,531  $    192,422          6.85%
  Taxable investment securities      2,407,189        29,561          4.91%
  Tax-exempt investment
   securities                          515,856         6,761          5.24%
  Equity securities                    213,004         2,380          4.48%
                                  ------------  ------------  ------------
  Total Investment Securities        3,136,049        38,702          4.94%
  Loans held for sale                   98,676         1,577          6.39%
  Other interest-earning assets         26,784           218          3.25%
                                  ------------  ------------  ------------
  Total Interest-earning Assets     14,557,040       232,919          6.43%
Noninterest-earning assets:
  Cash and due from banks              310,719
  Premises and equipment               196,037
  Other assets                         927,260
  Less: allowance for loan losses     (109,914)
                                  ------------
  Total Assets                    $ 15,881,142
                                  ============


LIABILITIES AND SHAREHOLDERS'
 EQUITY
Interest-bearing liabilities:
  Demand deposits                 $  1,685,620  $      4,405          1.05%
  Savings deposits                   2,137,704         9,163          1.72%
  Time deposits                      4,520,004        49,918          4.44%
                                  ------------  ------------  ------------
  Total Interest-bearing Deposits    8,343,328        63,486          3.06%
  Short-term borrowings              2,347,463        18,828          3.19%
  Federal Home Loan Bank advances
   and long-term debt                1,798,508        21,007          4.69%
                                  ------------  ------------  ------------
  Total Interest-bearing
   Liabilities                      12,489,299       103,321          3.32%
Noninterest-bearing liabilities:
  Demand deposits                    1,616,283
  Other                                190,496
                                  ------------
  Total Liabilities                 14,296,078
  Shareholders' equity               1,585,064
                                  ------------
  Total Liabilities and
   Shareholders' Equity           $ 15,881,142
                                  ============

  Net interest income/net
   interest margin (fully taxable
   equivalent)                                       129,598          3.58%
                                                              ============
  Tax equivalent adjustment                           (3,699)
                                                ------------
  Net interest income                           $    125,899
                                                ============



                                                Quarter Ended
                                  ----------------------------------------
                                              December 31, 2008
                                  ----------------------------------------
                                    Average                      Yield/
                                    Balance     Interest (1)      Rate
                                  ------------  ------------  ------------
ASSETS
Interest-earning assets:
  Loans, net of unearned income   $ 11,960,067  $    178,096          5.93%
  Taxable investment securities      2,086,808        26,106          5.00%
  Tax-exempt investment
   securities                          516,045         7,073          5.48%
  Equity securities                    154,660           797          2.05%
                                  ------------  ------------  ------------
  Total Investment Securities        2,757,513        33,976          4.93%
  Loans held for sale                   64,096           975          6.08%
  Other interest-earning assets         23,889           124          2.08%
                                  ------------  ------------  ------------
  Total Interest-earning Assets     14,805,565       213,171          5.74%
Noninterest-earning assets:
  Cash and due from banks              317,571
  Premises and equipment               200,918
  Other assets                         960,606
  Less: allowance for loan losses     (150,266)
                                  ------------
  Total Assets                    $ 16,134,394
                                  ============


LIABILITIES AND SHAREHOLDERS'
 EQUITY
Interest-bearing liabilities:
  Demand deposits                 $  1,727,874  $      2,630          0.61%
  Savings deposits                   2,070,931         6,124          1.18%
  Time deposits                      4,818,068        41,553          3.43%
                                  ------------  ------------  ------------
  Total Interest-bearing Deposits    8,616,873        50,307          2.32%
  Short-term borrowings              2,251,571         5,998          1.05%
  Federal Home Loan Bank advances
   and long-term debt                1,798,688        20,427          4.53%
                                  ------------  ------------  ------------
  Total Interest-bearing
   Liabilities                      12,667,132        76,732          2.41%
Noninterest-bearing liabilities:
  Demand deposits                    1,643,118
  Other                                196,004
                                  ------------
  Total Liabilities                 14,506,254
  Shareholders' equity               1,628,140
                                  ------------
  Total Liabilities and
   Shareholders' Equity           $ 16,134,394
                                  ============

  Net interest income/net
   interest margin (fully taxable
   equivalent)                                       136,439          3.68%
                                                              ============
  Tax equivalent adjustment                           (4,098)
                                                ------------
  Net interest income                           $    132,341
                                                ============

(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                % Change from
                   -------------------------------------- ----------------
                                                           March   December
                     March 31     March 31   December 31     31       31
                       2009         2008         2008       2008     2008
                   ------------ ------------ ------------ -------  -------

Loans, by type:
  Real estate -
   commercial
   mortgage        $  4,048,269 $  3,529,168 $  3,965,145    14.7%    2.1%
  Commercial -
   industrial,
   financial and
   agricultural       3,682,678    3,472,443    3,603,790     6.1%    2.2%
  Real estate -
   home equity        1,698,599    1,526,473    1,673,570    11.3%    1.5%
  Real estate -
   construction       1,203,328    1,349,924    1,269,104   (10.9%)  (5.2%)
  Real estate -
   residential
   mortgage             957,939      858,187      978,223    11.6%   (2.1%)
  Consumer              360,919      473,247      378,686   (23.7%)  (4.7%)
  Leasing and
   other                 89,554       86,089       91,549     4.0%   (2.2%)
                   ------------ ------------ ------------

  Total Loans, net
   of unearned
   income          $ 12,041,286 $ 11,295,531 $ 11,960,067     6.6%    0.7%
                   ============ ============ ============

Deposits, by type:
  Noninterest-bea-
   ring demand     $  1,657,658 $  1,616,283 $  1,643,118     2.6%    0.9%
  Interest-bearing
   demand             1,754,003    1,685,620    1,727,874     4.1%    1.5%
  Savings deposits    2,058,021    2,137,704    2,070,931    (3.7%)  (0.6%)
  Time deposits       5,432,676    4,520,004    4,818,068    20.2%   12.8%
                   ------------ ------------ ------------

  Total Deposits   $ 10,902,358 $  9,959,611 $ 10,259,991     9.5%    6.3%
                   ============ ============ ============

Short-term
 borrowings, by
 type:
  Federal funds
   purchased       $    792,001 $  1,184,370 $  1,426,618   (33.1%) (44.5%)
  Short-term
   promissory
   notes                337,069      471,470      391,781   (28.5%) (14.0%)
  Customer
   repurchase
   agreements           246,429      226,921      244,633     8.6%    0.7%
  Federal Reserve
   Bank borrowings      138,222            -            -      N/A     N/A
  Overnight
   borrowings and
   other                  3,343      464,702      188,539   (99.3%) (98.2%)
                   ------------ ------------ ------------

  Total Short-term
   borrowings      $  1,517,064 $  2,347,463 $  2,251,571   (35.4%) (32.6%)
                   ============ ============ ============

  N/A - Not Applicable





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

                                                    Quarter Ended
                                           -------------------------------
                                                                 December
                                           March 31   March 31      31
                                             2009       2008       2008
                                           ---------  ---------  ---------
ALLOWANCE FOR CREDIT LOSSES:
  Balance at beginning of period           $ 180,137  $ 112,209  $ 141,829
  Loans charged off:
    Real estate - construction               (12,242)         -    (11,877)
    Commercial - industrial, agricultural
     and financial                           (10,622)    (2,764)    (6,392)
    Real estate - commercial mortgage         (3,960)      (318)    (4,688)
    Real estate - residential mortgage and
     home equity                              (1,937)      (531)    (2,899)
    Consumer                                  (2,076)    (1,381)    (1,450)
    Leasing and other                           (946)      (632)    (1,033)
                                           ---------  ---------  ---------
    Total loans charged off                  (31,783)    (5,626)   (28,339)
  Recoveries of loans charged off:
    Real estate - construction                   112          -          -
    Commercial - industrial, agricultural
     and financial                               904        276        770
    Real estate - commercial mortgage             10         77          5
    Real estate - residential mortgage and
     home equity                                   1          3         56
    Consumer                                     429        418        465
    Leasing and other                            253        492        351
                                           ---------  ---------  ---------
    Recoveries of loans previously charged
     off                                       1,709      1,266      1,647
                                           ---------  ---------  ---------
  Net loans charged off                      (30,074)    (4,360)   (26,692)
  Provision for loan losses                   50,000     11,220     65,000
                                           ---------  ---------  ---------
  Balance at end of period                 $ 200,063  $ 119,069  $ 180,137
                                           =========  =========  =========

  Net charge-offs to average loans
   (annualized)                                 1.00%      0.15%      0.89%
                                           =========  =========  =========

COMPONENTS OF ALLOWANCE FOR CREDIT LOSSES:
  Allowance for loan losses                $ 192,410  $ 115,257  $ 173,946
  Reserve for unfunded lending commitments     7,653      3,812      6,191
                                           ---------  ---------  ---------
  Allowance for credit losses              $ 200,063  $ 119,069  $ 180,137
                                           =========  =========  =========



NON-PERFORMING ASSETS:
  Non-accrual loans                        $ 198,765  $  96,588  $ 161,962
  Loans 90 days past due and accruing         47,284     29,733     35,177
                                           ---------  ---------  ---------
    Total non-performing loans               246,049    126,321    197,139
  Other real estate owned                     23,189     18,333     21,855
                                           ---------  ---------  ---------
  Total non-performing assets              $ 269,238  $ 144,654  $ 218,994
                                           =========  =========  =========

NON-PERFORMING LOANS, BY TYPE:
  Real estate - construction               $  93,425  $  28,160  $  80,083
  Commercial - industrial, agricultural
   and financial                              50,493     35,462     40,294
  Real estate - commercial mortgage           59,899     30,162     41,745
  Real estate - residential mortgage and
   home equity                                31,365     24,586     26,304
  Consumer                                    10,316      5,858      8,374
  Leasing                                        551      2,093        339
                                           ---------  ---------  ---------
  Total non-performing loans               $ 246,049  $ 126,321  $ 197,139
                                           =========  =========  =========

ASSET QUALITY RATIOS:
  Non-accrual loans to total loans              1.66%      0.85%      1.34%
  Non-performing assets to total loans and
   OREO                                         2.24%      1.27%      1.82%
  Non-performing assets to total assets         1.63%      0.90%      1.35%
  Allowance for credit losses to loans
   outstanding                                  1.67%      1.05%      1.50%
  Allowance for loan losses to loans
   outstanding                                  1.60%      1.01%      1.44%
  Allowance for credit losses to
   non-performing loans                           81%        94%        91%
  Non-performing assets to tangible common
   shareholders' equity and allowance for
   credit losses                               23.71%     13.42%     19.68%





FULTON FINANCIAL CORPORATION
RECONCILIATION OF NON-GAAP MEASURE (UNAUDITED)
dollars in thousands, except per-share data

Explanatory note:  This press release contains certain financial
 information, as detailed below, which has been derived by methods other
 than Generally Accepted Accounting Standards ("GAAP") that Management
 uses  in its analysis of the Corporation's performance. The Corporation
 has presented these non-GAAP measures because it believes that they
 provide more useful and comparative information to assess trends in the
 Corporation's quarterly results of operations. These non-GAAP measures
 should not be considered a substitute for GAAP basis measures and
 the Corporation strongly encourages a review of its condensed consolidated
 financial statements in their entirety.


                                                  Quarter Ended
                                        ----------------------------------
                                                  March 31, 2009
                                        ----------------------------------
                                          Pre-tax   After-tax     Diluted
                                        (Expense)/  (Expense)/      EPS
                                          Income      Income      Impact
                                        ----------  ----------  ----------

Goodwill impairment charge              $        -  $        -  $        -
Other-than-temporary impairment of
 securities                                 (3,040)     (1,976)      (0.01)
Guarantee related to purchase of
 customer auction rate securities           (6,158)     (4,003)      (0.02)
Investment securities gains and
 (losses) on sale                            5,959       3,873        0.02
                                        ----------  ----------  ----------
  Totals                                    (3,239)     (2,106)      (0.01)

Net income (loss) available to common
 shareholders                                            8,054        0.05
                                                    ----------  ----------

Adjusted net income available to common
 shareholders                                       $   10,160  $     0.06
                                                    ==========  ==========



                                                  Quarter Ended
                                        ----------------------------------
                                                  March 31, 2008
                                        ----------------------------------
                                          Pre-tax   After-tax     Diluted
                                        (Expense)/  (Expense)/      EPS
                                          Income      Income      Impact
                                        ----------  ----------  ----------

Goodwill impairment charge              $        -  $        -  $        -
Other-than-temporary impairment of
 securities                                 (3,575)     (2,324)      (0.01)
Guarantee related to purchase of
 customer auction rate securities                -           -           -
Investment securities gains and
 (losses) on sale                            4,821       3,134        0.02
                                        ----------  ----------  ----------
  Totals                                     1,246         810        0.01

Net income (loss) available to common
 shareholders                                           41,496        0.24
                                                    ----------  ----------

Adjusted net income available to common
 shareholders                                       $   40,686  $     0.23
                                                    ==========  ==========



                                                  Quarter Ended
                                        ----------------------------------
                                                December 31, 2008
                                        ----------------------------------
                                          Pre-tax   After-tax     Diluted
                                        (Expense)/  (Expense)/      EPS
                                          Income      Income      Impact
                                        ----------  ----------  ----------

Goodwill impairment charge              $  (90,000) $  (90,000)      (0.51)
Other-than-temporary impairment of
 securities                                (26,065)    (16,942)      (0.10)
Guarantee related to purchase of
 customer auction rate securities           (3,950)     (2,568)      (0.01)
Investment securities gains and
 (losses) on sale                           (2,274)     (1,478)      (0.01)
                                        ----------  ----------  ----------
  Totals                                  (122,289)   (110,988)      (0.63)

Net income (loss) available to common
 shareholders                                         (102,330)      (0.58)
                                                    ----------  ----------

Adjusted net income available to common
 shareholders                                       $    8,658  $     0.05
                                                    ==========  ==========

Contact Information

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