SOURCE: Fulton Financial Corporation

Fulton Financial Corporation

October 20, 2009 16:30 ET

Fulton Financial Reports Third Quarter Earnings

LANCASTER, PA--(Marketwire - October 20, 2009) - Fulton Financial Corporation (NASDAQ: FULT) reported net income available to common shareholders of $18.3 million for the quarter ended September 30, 2009, a 37.1 percent decrease from the same period in 2008. Diluted net income per share for the quarter was 10 cents, a 41.2 percent decrease from the same period in 2008. Diluted net income per share for the quarter increased 100.0 percent from the 5 cents reported in the second quarter of 2009.

Net income available to common shareholders was $34.4 million for the nine months ended September 30, 2009, a 64.2 percent decrease from the same period in 2008. Diluted net income per share for the nine months ended September 30, 2009 was 20 cents, a 63.6 percent decrease from the 55 cents reported in 2008. Total assets at September 30, 2009 were $16.5 billion.

"While the past year has been extremely challenging for us, the quarter just completed showed slowing in the rate of credit deterioration within our loan portfolio and, as a result, we were able to decrease the provision from the second quarter," said R. Scott Smith, Jr., chairman and chief executive officer. "A shift in our deposit mix as a result of strong core checking and savings deposit growth along with lower re-pricing of maturing certificates of deposit accounted for the improvement in our net interest margin. While most non-interest income categories showed increases, our total other income was impacted by a slowdown in the high level of mortgage refinancing activity and subsequent sale gains that we saw earlier in the year. Expenses remain well controlled."

Loans, net of unearned income, increased $144.7 million, or 1.2 percent, to $12.0 billion at September 30, 2009, compared to $11.8 billion at September 30, 2008. The increase was primarily due to a $312.9 million, or 8.1 percent, increase in commercial mortgages and a $165.4 million, or 4.7 percent, increase in commercial loans. These increases were partially offset by a $278.9 million, or 21.3 percent, decrease in construction loans and a $42.7 million, or 4.4 percent, decrease in residential mortgages. In comparison to the second quarter of 2009, loans, net of unearned income, increased $101.4 million, or 0.9 percent, mainly due to a $105.8 million, or 2.9 percent, increase in commercial loans and a $65.4 million, or 1.6 percent, increase in commercial mortgages, offset by a $67.0 million, or 6.1 percent, decrease in construction loans.

Non-performing assets were $300.9 million, or 1.82 percent of total assets, at September 30, 2009, compared to $186.4 million, or 1.15 percent, at September 30, 2008 and $292.2 million, or 1.73 percent, at June 30, 2009. The $114.5 million, or 61.5 percent, increase in non-performing assets since September 30, 2008 was primarily due to a $47.4 million, or 82.4 percent, increase in non-performing construction loans, a $22.3 million, or 68.3 percent, increase in non-performing commercial mortgages, a $21.7 million, or 52.4 percent, increase in non-performing commercial loans and a $19.9 million, or 75.8 percent, increase in non-performing residential mortgage and home equity loans.

Annualized net charge-offs for the quarter ended September 30, 2009 were 0.81 percent of average total loans, compared to 0.38 percent for the quarter ended September 30, 2008 and 0.97 percent for the quarter ended June 30, 2009. The increase in charge-offs was primarily in construction loans and commercial loans. For the nine months ended September 30, 2009, annualized net charge-offs were 0.93 percent of average total loans, compared to 0.29 percent for the same period in 2008. The provision for loan losses increased $18.3 million, or 68.5 percent, for the third quarter of 2009 as compared to the same period in 2008, and decreased $5.0 million, or 10.0 percent, in comparison to the second quarter of 2009. For the nine months ended September 30, 2009, the provision for loan losses was $145.0 million, a 165.4 percent increase from the $54.6 million recorded during the nine months ended September 30, 2008. The increase in the provision for loan losses in comparison to the three and nine months ended September 30, 2008 was due to the increase in the level of non-performing assets and net charge-offs, which required additional increases to the allowance for credit losses.

Total deposits increased $2.1 billion, or 21.3 percent, to $12.0 billion at September 30, 2009 compared to $9.9 billion at September 30, 2008. The increase was due to a $1.1 billion, or 24.6 percent, increase in time deposits and a $1.0 billion, or 18.7 percent, increase in demand and savings deposits. In comparison to the second quarter of 2009, total deposits increased $316.4 million, or 2.7 percent, due to a $414.6 million, or 6.7 percent, increase in demand and savings deposits, offset by a $98.2 million, or 1.8 percent, decrease in time deposits.

Net interest income for the third quarter of 2009 decreased $1.2 million, or 0.9 percent, compared to the same period in 2008 and increased $4.9 million, or 3.8 percent, from the second quarter of 2009. The Corporation's net interest margin was 3.55 percent for the third quarter of 2009, 3.77 percent for the third quarter of 2008 and 3.43 percent for second quarter of 2009.

Other income, excluding investment securities gains (losses), increased $909,000, or 2.3 percent, in the third quarter of 2009 compared to the same period in 2008. The increase was due to a $512,000 increase in gains on sales of mortgage loans and an increase in servicing fees on mortgage loans sold with servicing retained, due to increased volumes of loans sold. These increases were offset by an $856,000 decrease in service charges on deposit accounts, primarily in cash management fees. Compared to the second quarter of 2009, other income, excluding investment securities gains (losses), decreased $4.1 million, or 9.0 percent, primarily due to a decrease in gains on sales of mortgage loans.

Investment securities losses in the third quarter of 2009 were $45,000 compared to losses of $9.5 million in the third quarter of 2008. Investment securities losses in the third quarter of 2009 included $2.8 million of net gains on the sale of debt and equity securities, offset by $1.8 million of other-than-temporary impairment charges related to debt securities issued by financial institutions and $949,000 of other-than-temporary impairment charges related to bank stocks. During the third quarter of 2008, the Corporation recorded $7.8 million of other-than-temporary impairment charges related to debt securities issued by financial institutions and $2.0 million of other-than-temporary impairment charges related to bank stocks.

Other expenses increased $455,000, or 0.5 percent, in the third quarter of 2009 compared to the same period in 2008. The increase was primarily due to $4.1 million increase in Federal Deposit Insurance Corporation (FDIC) insurance expense, partially offset by a decrease of $3.1 million in operating risk loss. During the third quarter of 2008, the Corporation recorded $2.7 million of charges, as a component of operating risk loss, related to its 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. (FFA). During the second quarter of 2009, the Corporation purchased all outstanding auction rate securities held by FFA's customers. In comparison to the second quarter of 2009, other expenses decreased $8.0 million, or 7.4 percent. The decrease was primarily due to a $7.7 million special FDIC assessment recorded in the second quarter of 2009.

Fulton Financial Corporation is a Lancaster, Pennsylvania-based financial holding company which has nearly 3,900 employees and operates more than 270 banking offices in Pennsylvania, Maryland, Delaware, New Jersey and Virginia through the following affiliates: Fulton Bank, N.A., Lancaster, PA; Swineford National Bank, Middleburg, PA; Lafayette Ambassador Bank, Easton, PA; FNB Bank, N.A., Danville, PA; Delaware National Bank, Georgetown, DE; The Bank, Woodbury, NJ; 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; changes in the levels of FDIC deposit insurance premiums and assessments; the effect of competition and interest rates on net interest margin and net interest income; investment strategy and income growth; investment securities gains and losses; 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


               September 30
         ------------------------
BALANCE                               %
SHEET       2009         2008      Change
DATA     -----------  -----------  -------

Total
 assets  $16,526,709  $16,136,145    2.4%
Loans,
 net of
 unearned
 income   11,968,246   11,823,529    1.2%
Invest-
 ment
 secur-
 ities     3,274,399    2,806,535   16.7%
Deposits  12,032,680    9,916,555   21.3%
Share-
 holders'
 equity    1,923,763    1,603,910   19.9%

              Quarter Ended                   Nine Months Ended
               September 30                     September 30
         ------------------------           --------------------
INCOME      2009          2008    % Change     2009      2008     % Change
 SUMMARY -----------  ----------- --------  ---------  ---------  --------

Interest
 income  $   197,861  $   213,809   (7.5%)  $ 591,525  $ 658,421   (10.2%)
Interest
 expense     (65,060)     (79,791) (18.5%)   (206,664)  (266,614)  (22.5%)
         -----------  -----------           ---------  ---------
 Net
  interest
   income    132,801      134,018   (0.9%)    384,861    391,807    (1.8%)
Provision
 for loan
 losses      (45,000)     (26,700)  68.5%    (145,000)   (54,626)  165.4%
Investment
 securities
 gains
 (losses)        (45)      (9,501)  99.5%       2,951    (29,902)      N/M
Gain on
 sale of
 credit
 card
 portfolio         -            -      -            -     13,910  (100.0%)
Other
 income       41,225       40,316    2.3%     130,520    116,637    11.9%
Other
 expenses    (99,810)     (99,355)   0.5%    (313,988)  (305,751)    2.7%
         -----------  -----------           ---------  ---------
 Income
  before
  income
  taxes       29,171       38,778  (24.8%)     59,344    132,075   (55.1%)
Income
 tax
 expense      (5,825)      (9,702) (40.0%)     (9,802)   (35,825)  (72.6%)
         -----------  -----------           ---------  ---------
 Net
  income      23,346       29,076  (19.7%)  $  49,542  $  96,250   (48.5%)
Preferred
 stock
 dividends
 and
 discount
 accretion    (5,046)           -      N/A    (15,123)         -       N/A
         -----------  -----------           ---------  ---------
 Net
  income
  available
  to
  common
  share-
  holders$    18,300  $    29,076  (37.1%)  $  34,419  $  96,250   (64.2%)
         ===========  ===========           =========  =========

PER
 COMMON
 SHARE:

Net
 income:
  Basic  $      0.10  $      0.17  (41.2%)  $    0.20  $    0.55   (63.6%)
  Diluted       0.10         0.17  (41.2%)       0.20       0.55   (63.6%)
Cash
 dividends      0.03         0.15  (80.0%)       0.09       0.45   (80.0%)

Shareholders'
 equity         8.82         9.18   (3.9%)       8.82       9.18    (3.9%)
Shareholders'
 equity
 (tangible)     5.68         5.46    4.0%        5.68       5.46     4.0%

SELECTED
 FINANCIAL
 RATIOS:

Return
 on
 average
 assets         0.56%        0.73%               0.40%      0.81%
Return
 on
 average
 common
 shareholders'
 equity         4.78%        7.25%               3.06%      8.02%
Return
 on
 average
 common
 shareholders'
 equity
 (tangible)     7.91%       12.72%               5.24%     14.00%
Net
 interest
 margin         3.55%        3.77%               3.48%      3.71%
Efficiency
 ratio         55.33%       54.74%              58.76%     56.22%
Tangible
 common
 equity
 to
 tangible
 assets         6.26%        6.16%               6.26%      6.16%
Non-performing
 assets
 to
 total
 assets         1.82%        1.15%               1.82%      1.15%



N/A - Not applicable
N/M - Not meaningful




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

                                                       % Change from
                                                  ------------------------
            September 30 September 30   June 30   September 30   June 30
                2009         2008         2009        2008         2009
            ------------ ------------ ----------- ------------ -----------

ASSETS
 Cash and
  due from
  banks     $    252,004 $    315,841 $   299,818      (20.2%)     (15.9%)
 Loans held
  for sale        84,766       71,090     242,439       19.2%      (65.0%)
 Other
  interest-
  earning
  assets          24,048       50,189      25,890      (52.1%)      (7.1%)
 Investment
  securities   3,274,399    2,806,535   3,335,403       16.7%       (1.8%)
 Loans, net
  of unearned
  income      11,968,246   11,823,529  11,866,818        1.2%        0.9%
 Allowance
  for loan
  losses        (234,511)    (136,988)   (214,170)      71.2%        9.5%
            ------------ ------------ -----------
  Net
   Loans      11,733,735   11,686,541  11,652,648        0.4%        0.7%
 Premises
  and
  equipment      204,520      199,464     205,074        2.5%       (0.3%)
 Accrued
  interest
  receivable      60,433       62,018      58,077       (2.6%)       4.1%
 Goodwill
  and
  intangible
  assets         554,041      649,635     555,272      (14.7%)      (0.2%)
 Other
  assets         338,763      294,832     501,231       14.9%      (32.4%)
            ------------ ------------ -----------
    Total
     Assets $ 16,526,709 $ 16,136,145 $16,875,852        2.4%       (2.1%)
            ============ ============ ===========

LIABILITIES
 AND
 SHAREHOLDERS'
 EQUITY
 Deposits   $ 12,032,680 $  9,916,555 $11,716,297       21.3%        2.7%
 Short-term
  borrowings     722,618    2,589,966   1,317,293      (72.1%)     (45.1%)
 Federal
  Home Loan
  Bank
  advances
  and
  long-term
  debt         1,650,870    1,819,889   1,750,967       (9.3%)      (5.7%)
 Other
  liabilities    196,778      205,825     218,367       (4.4%)      (9.9%)
            ------------ ------------ -----------
    Total
     Liabil-
     ities    14,602,946   14,532,235  15,002,924        0.5%       (2.7%)

 Preferred
  stock          369,950            -     369,610          N/A       0.1%
 Common
  shareholders'
  equity       1,553,813    1,603,910   1,503,318       (3.1%)       3.4%
            ------------ ------------ -----------
    Total
     Share-
     holders'
     Equity    1,923,763    1,603,910   1,872,928       19.9%        2.7%
            ------------ ------------ -----------
     Total
      Liabil-
      ities
      and
      Share-
      holders'
      Equi-
      ty    $ 16,526,709 $ 16,136,145 $16,875,852        2.4%       (2.1%)
            ============ ============ ===========

LOANS,
 DEPOSITS
 AND
 SHORT-TERM
 BORROWINGS
 DETAIL:
Loans, by
 type:
 Real
  estate -
  commercial
  mortgage  $  4,186,654 $  3,873,802 $ 4,121,208        8.1%        1.6%
 Commercial -
  industrial,
  financial
  and
  agricultural 3,719,966    3,554,615   3,614,144        4.7%        2.9%
 Real
  estate -
  home
  equity       1,651,711    1,647,063   1,653,461        0.3%       (0.1%)
 Real
  estate -
  construction 1,029,079    1,308,008   1,096,047      (21.3%)      (6.1%)
 Real
  estate -
  residential
  mortgage       930,207      972,930     925,270       (4.4%)       0.5%
 Consumer        375,685      388,032     371,492       (3.2%)       1.1%
 Leasing
  and other       74,944       79,079      85,196       (5.2%)     (12.0%)
            ------------ ------------ -----------
 Total
  Loans,
  net of
  unearned
  income    $ 11,968,246 $ 11,823,529 $11,866,818        1.2%        0.9%
            ============ ============ ===========
Deposits, by
 type:
 Noninterest-
  bearing
  demand    $  1,932,382 $  1,690,499 $ 1,942,845       14.3%       (0.5%)
 Interest-
  bearing
  demand       1,922,648    1,690,330   1,793,070       13.7%        7.2%
 Savings
  deposits     2,732,284    2,166,998   2,436,815       26.1%       12.1%
 Time
  deposits     5,445,366    4,368,728   5,543,567       24.6%       (1.8%)
            ------------ ------------ -----------
 Total
  Deposits  $ 12,032,680 $  9,916,555 $11,716,297       21.3%        2.7%
            ============ ============ ===========
Short-term
 borrowings,
 by type:
 Federal
  funds
  purchased $    210,865 $  1,326,873 $   781,357      (84.1%)     (73.0%)
 Short-term
  promissory
  notes          258,911      460,512     274,028      (43.8%)      (5.5%)
 Customer
  repurchase
  agreements     252,842      222,415     261,444       13.7%       (3.3%)
 Overnight
  borrowings
  and
  other                -      580,166         464     (100.0%)    (100.0%)
            ------------ ------------ -----------
 Total
  Short-
  term
  borrow-
  ings      $    722,618 $  2,589,966 $ 1,317,293      (72.1%)     (45.1%)
            ============ ============ ===========


N/A - Not Applicable



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

                                  Quarter Ended           % Change from
                          ----------------------------  ------------------
                           Sep 30    Sep 30    Jun 30    Sep 30    Jun 30
                            2009      2008      2009      2008      2009
                          --------  --------  --------  --------  --------

Interest Income:
   Interest income        $197,861  $213,809  $198,097     (7.5%)    (0.1%)
   Interest expense         65,060    79,791    70,153    (18.5%)    (7.3%)
                          --------  --------  --------
     Net Interest Income   132,801   134,018   127,944     (0.9%)     3.8%
   Provision for loan
    losses                  45,000    26,700    50,000     68.5%    (10.0%)
                          --------  --------  --------
     Net Interest Income
      after Provision       87,801   107,318    77,944    (18.2%)    12.6%
Other Income:
   Service charges on
    deposit accounts        15,321    16,177    15,061     (5.3%)     1.7%
   Other service charges
    and fees                10,003     9,598     9,595      4.2%      4.3%
   Investment management
    and trust services       8,191     8,045     7,876      1.8%      4.0%
   Gains on sales of
    mortgage loans           2,778     2,266     7,395     22.6%    (62.4%)
   Investment securities
    gains (losses)             (45)   (9,501)       77     99.5%      N/M
   Gain on sale of credit
    card portfolio               -         -         -        -         -
   Other                     4,932     4,230     5,373     16.6%     (8.2%)
                          --------  --------  --------
     Total Other Income     41,180    30,815    45,377     33.6%     (9.2%)
Other Expenses:
   Salaries and employee
    benefits                54,086    55,310    55,799     (2.2%)    (3.1%)
   Net occupancy expense    10,165    10,237    10,240     (0.7%)    (0.7%)
   FDIC insurance expense    5,244     1,147    12,206    357.2%    (57.0%)
   Equipment expense         3,281     3,061     3,300      7.2%     (0.6%)
   Data processing           3,121     3,242     2,907     (3.7%)     7.4%
   Marketing                 1,982     3,097     1,724    (36.0%)    15.0%
   Intangible
    amortization             1,429     1,730     1,434    (17.4%)    (0.3%)
   Operating risk loss         338     3,480       144    (90.3%)   134.7%
   Other                    20,164    18,051    20,052     11.7%      0.6%
                          --------  --------  --------
     Total Other Expenses   99,810    99,355   107,806      0.5%     (7.4%)
                          --------  --------  --------
     Income Before Income
      Taxes                 29,171    38,778    15,515    (24.8%)    88.0%
   Income tax expense        5,825     9,702     2,404    (40.0%)   142.3%
                          --------  --------  --------
     Net Income             23,346    29,076    13,111    (19.7%)    78.1%
   Preferred stock
    dividends and
    discount accretion      (5,046)        -    (5,046)     N/A         -
                          --------  --------  --------
     Net Income Available
      to Common
      Shareholders        $ 18,300  $ 29,076  $  8,065    (37.1%)   126.9%
                          ========  ========  ========

PER COMMON SHARE:
   Net income:
     Basic                $   0.10  $   0.17  $   0.05    (41.2%)   100.0%
     Diluted                  0.10      0.17      0.05    (41.2%)   100.0%

   Cash dividends         $   0.03  $   0.15  $   0.03    (80.0%)       -
   Shareholders' equity       8.82      9.18      8.56     (3.9%)     3.0%
   Shareholders' equity
    (tangible)                5.68      5.46      5.40      4.0%      5.2%

   Weighted average
    shares (basic)         175,783   174,463   175,554      0.8%      0.1%
   Weighted average
    shares (diluted)       176,078   174,912   175,724      0.7%      0.2%
   Shares outstanding,
    end of period          176,149   174,687   175,706      0.8%      0.3%

SELECTED FINANCIAL
 RATIOS:
   Return on average
    assets                    0.56%     0.73%     0.32%
   Return on average
    common shareholders'
    equity                    4.78%     7.25%     2.16%
   Return on average
    common shareholders'
    equity (tangible)         7.91%    12.72%     3.83%
   Net interest margin        3.55%     3.77%     3.43%
   Efficiency ratio          55.33%    54.74%    60.08%



                          Nine Months Ended
                             September 30
                          ------------------
                            2009      2008    % Change
                          --------  --------  --------

Interest Income:
   Interest income        $591,525  $658,421    (10.2%)
   Interest expense        206,664   266,614    (22.5%)
                          --------  --------
     Net Interest Income   384,861   391,807     (1.8%)
   Provision for loan
    losses                 145,000    54,626    165.4%
                          --------  --------
     Net Interest Income
      after Provision      239,861   337,181    (28.9%)
Other Income:
   Service charges on
    deposit accounts        45,276    45,463     (0.4%)
   Other service charges
    and fees                27,952    27,320      2.3%
   Investment management
    and trust services      23,970    25,193     (4.9%)
   Gains on sales of
    mortgage loans          18,764     7,247    158.9%
   Investment securities
    gains (losses)           2,951   (29,902)     N/M
   Gain on sale of credit
    card portfolio               -    13,910   (100.0%)
   Other                    14,558    11,414     27.5%
                          --------  --------
     Total Other Income    133,471   100,645     32.6%
Other Expenses:
   Salaries and employee
    benefits               165,189   164,786      0.2%
   Net occupancy expense    31,428    30,999      1.4%
   FDIC insurance expense   21,738     2,684    709.9%
   Equipment expense         9,660     9,907     (2.5%)
   Data processing           9,100     9,604     (5.2%)
   Marketing                 6,277     9,521    (34.1%)
   Intangible
    amortization             4,326     5,386    (19.7%)
   Operating risk loss       6,683    19,108    (65.0%)
   Other                    59,587    53,756     10.8%
                          --------  --------
     Total Other Expenses  313,988   305,751      2.7%
                          --------  --------
     Income Before Income
      Taxes                 59,344   132,075    (55.1%)
   Income tax expense        9,802    35,825    (72.6%)
                          --------  --------
     Net Income             49,542    96,250    (48.5%)
   Preferred stock
    dividends and
    discount accretion     (15,123)        -      N/A
                          --------  --------
     Net Income Available
      to Common
      Shareholders        $ 34,419  $ 96,250    (64.2%)
                          ========  ========

PER COMMON SHARE:
   Net income:
     Basic                $   0.20  $   0.55    (63.6%)
     Diluted                  0.20      0.55    (63.6%)

   Cash dividends         $   0.09  $   0.45    (80.0%)
   Shareholders' equity       8.82      9.18     (3.9%)
   Shareholders' equity
    (tangible)                5.68      5.46      4.0%

   Weighted average
    shares (basic)         175,552   174,017      0.9%
   Weighted average
    shares (diluted)       175,785   174,551      0.7%
   Shares outstanding,
    end of period          176,149   174,687      0.8%

SELECTED FINANCIAL
 RATIOS:
   Return on average
    assets                    0.40%     0.81%
   Return on average
    common shareholders'
    equity                    3.06%     8.02%
   Return on average
    common shareholders'
    equity (tangible)         5.24%    14.00%
   Net interest margin        3.48%     3.71%
   Efficiency ratio          58.76%    56.22%

N/A - Not applicable
N/M - Not meaningful



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


                                       Quarter Ended
                  --------------------------------------------------------
                      September 30, 2009           September 30, 2008
                  ---------------------------  ---------------------------
                    Average    Interest Yield/   Average    Interest Yield/
                    Balance      (1)     Rate    Balance      (1)     Rate
                  -----------  --------  ----  -----------  --------  ----
ASSETS
Interest-earning
 assets:
  Loans, net of
   unearned
   income         $11,913,581  $163,915  5.46% $11,696,841  $181,562  6.18%
  Taxable
   investment
   securities       2,722,751    29,376  4.31%   2,117,207    26,025  4.92%
  Tax-exempt
   investment
   securities         436,209     6,101  5.59%     509,994     6,944  5.45%
  Equity
   securities         132,176       632  1.90%     168,690     1,614  3.82%
                  -----------  --------  ----  -----------  --------  ----
  Total
   Investment
   Securities       3,291,136    36,109  4.39%   2,795,891    34,583  4.95%
  Loans held for
   sale               102,367     1,550  6.06%     101,319     1,539  6.08%
  Other
   interest-earning
   assets              24,348        51  0.83%      19,013       142  2.94%
                  -----------  --------  ----  -----------  --------  ----
  Total
   Interest-earning
   Assets          15,331,432   201,625  5.23%  14,613,064   217,826  5.94%

Noninterest-earning
 assets:
  Cash and due
   from banks         301,875                      322,550
  Premises and
   equipment          204,416                      197,895
  Other assets        959,628                      933,303
  Less: allowance
   for loan
   losses            (234,446)                    (123,865)
                  -----------                  -----------
  Total Assets    $16,562,905                  $15,942,947
                  ===========                  ===========


LIABILITIES AND
 SHAREHOLDERS'
 EQUITY
Interest-bearing
 liabilities:
  Demand deposits $ 1,883,087  $  2,119  0.45% $ 1,734,198  $  3,166  0.73%
  Savings
   deposits         2,556,717     5,187  0.80%   2,192,747     6,633  1.20%
  Time deposits     5,554,349    36,519  2.61%   4,308,903    37,393  3.45%
                  -----------  --------  ----  -----------  --------  ----
  Total
   Interest-bearing
   Deposits         9,994,153    43,825  1.74%   8,235,848    47,192  2.28%
  Short-term
   borrowings         863,281       835  0.38%   2,432,109    12,877  2.08%
  Federal Home
   Loan Bank
   advances and
   long-term debt   1,695,427    20,400  4.77%   1,819,897    19,722  4.32%
                  -----------  --------  ----  -----------  --------  ----
  Total
   Interest-bearing
   Liabilities     12,552,861    65,060  2.06%  12,487,854    79,791  2.54%

Noninterest-bearing
 liabilities:
Demand deposits     1,922,460                    1,669,908
Other                 198,314                      190,012
                  -----------                  -----------
Total Liabilities  14,673,635                   14,347,774
Shareholders'
 equity             1,889,270                    1,595,173
                  -----------                  -----------
Total Liabilities
 and
 Shareholders'
 Equity           $16,562,905                  $15,942,947
                  ===========                  ===========

Net interest
 income/net
 interest margin
 (fully taxable
 equivalent)                    136,565  3.55%               138,035  3.77%
                                         ====                         ====
Tax equivalent
 adjustment                      (3,764)                      (4,017)
                               --------                     --------
Net interest
 income                        $132,801                     $134,018
                               ========                     ========

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


                                Quarter Ended
                  ----------------------------------------
                                June 30, 2009
                  ----------------------------------------
                    Average                      Yield/
                    Balance     Interest (1)      Rate
                  ------------  ------------  ------------
ASSETS
Interest-earning
 assets:
  Loans, net of
   unearned
   income         $ 11,960,669  $    163,744          5.49%
  Taxable
   investment
   securities        2,673,136        29,422          4.40%
  Tax-exempt
   investment
   securities          462,991         6,425          5.55%
  Equity
   securities          134,702           660          1.96%
                  ------------  ------------  ------------
  Total
   Investment
   Securities        3,270,829        36,507          4.47%
  Loans held for
   sale                139,354         1,628          4.67%
  Other
   interest-earning
   assets               20,897            40          0.76%
                  ------------  ------------  ------------
  Total
   Interest-earning
   Assets           15,391,749       201,919          5.26%

Noninterest-earning
 assets:
  Cash and due
   from banks          283,399
  Premises and
   equipment           204,451
  Other assets         938,156
  Less: allowance
   for loan
   losses             (211,166)
                  ------------
  Total Assets    $ 16,606,589
                  ============


LIABILITIES AND
 SHAREHOLDERS'
 EQUITY
Interest-bearing
 liabilities:
  Demand deposits $  1,818,897  $      2,002          0.44%
  Savings
   deposits          2,307,089         4,401          0.76%
  Time deposits      5,625,841        41,604          2.97%
                  ------------  ------------  ------------
  Total
   Interest-bearing
   Deposits          9,751,827        48,007          1.97%
  Short-term
   borrowings        1,186,541           921          0.31%
  Federal Home
   Loan Bank
   advances and
   long-term debt    1,780,120        21,225          4.78%
                  ------------  ------------  ------------
  Total
   Interest-bearing
   Liabilities       12,718,488        70,153          2.21%

Noninterest-bearing
 liabilities:
Demand deposits      1,812,539
Other                  206,901
                  ------------
Total Liabilities   14,737,928
Shareholders'
 equity              1,868,661
                  ------------
Total Liabilities
 and
 Shareholders'
 Equity           $ 16,606,589
                  ============

Net interest
 income/net
 interest margin
 (fully taxable
 equivalent)                         131,766          3.43%
                                              ============
Tax equivalent
 adjustment                           (3,822)
                                ------------
Net interest
 income                         $    127,944
                                ============

(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
                  -------------------------------------- -----------------
                                                         September
                  September 30 September 30   June 30       30     June 30
                      2009         2008         2009       2008     2009
                  ------------ ------------ ------------ -------  --------

Loans, by type:
   Real estate -
    commercial
    mortgage      $  4,158,802 $  3,806,311 $  4,091,498    9.3%      1.6%
   Commercial -
    industrial,
    financial and
    agricultural     3,667,854    3,545,797    3,656,294    3.4%      0.3%
   Real estate -
    home equity      1,651,400    1,619,687    1,668,562    2.0%     (1.0%)
   Real estate -
    construction     1,050,359    1,324,085    1,152,195  (20.7%)    (8.8%)
   Real estate -
    residential
    mortgage           933,943      947,510      935,983   (1.4%)    (0.2%)
   Consumer            371,676      369,052      371,610    0.7%       -
   Leasing and
    other               79,547       84,399       84,527   (5.7%)    (5.9%)
                  ------------ ------------ ------------

   Total Loans,
    net of
    unearned
    income        $ 11,913,581 $ 11,696,841 $ 11,960,669    1.9%     (0.4%)
                  ============ ============ ============

Deposits, by
 type:
  Noninterest-
   bearing demand $  1,922,460 $  1,669,908 $  1,812,539   15.1%      6.1%
  Interest-bearing
   demand            1,883,087    1,734,198    1,818,897    8.6%      3.5%
  Savings
   deposits          2,556,717    2,192,747    2,307,089   16.6%     10.8%
  Time deposits      5,554,349    4,308,903    5,625,841   28.9%     (1.3%)
                  ------------ ------------ ------------

   Total Deposits $ 11,916,613 $  9,905,756 $ 11,564,366   20.3%      3.0%
                  ============ ============ ============

Short-term
 borrowings, by
 type:
   Federal funds
    purchased     $    348,444 $  1,399,130 $    580,020  (75.1%)   (39.9%)
   Short-term
    promissory
    notes              259,534      486,179      297,743  (46.6%)   (12.8%)
   Customer
    repurchase
    agreements         254,789      213,827      256,306   19.2%     (0.6%)
   Federal
    Reserve Bank
    borrowings               -            -       48,352      -    (100.0%)
   Overnight
    borrowings
    and other              514      332,973        4,120  (99.8%)   (87.5%)
                  ------------ ------------ ------------

   Total
    Short-term
    borrowings    $    863,281 $  2,432,109 $  1,186,541  (64.5%)   (27.2%)
                  ============ ============ ============




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

                             Nine Months Ended September 30
              ------------------------------------------------------------
                             2009                         2008
              ------------------------------------------------------------
                Average      Interest  Yield/   Average    Interest  Yield/
                Balance        (1)     Rate    Balance        (1)     Rate
              ------------  ---------  ----  ------------  ---------  ----
ASSETS

Interest-earning
 assets:
  Loans, net of
   unearned
   income     $ 11,971,378  $ 491,412  5.49% $ 11,472,748  $ 554,437  6.45%
  Taxable
   investment
   securities    2,538,045     85,648  4.50%    2,275,681     84,114  4.93%
  Tax-exempt
   investment
   securities      467,242     19,413  5.54%      511,871     20,831  5.43%
  Equity
   securities      134,710      2,066  2.05%      192,803      5,723  3.96%
              ------------  ---------  ----  ------------  ---------  ----

  Total
   Investment
   Securities    3,139,997    107,127  4.55%    2,980,355    110,668  4.95%

  Loans held
   for sale        115,388      4,439  5.13%      102,819      4,726  6.13%
  Other
   interest-
   earning
   assets           20,754        140  0.90%       20,701        462  2.96%
              ------------  ---------  ----  ------------  ---------  ----

  Total
   Interest-
   earning
   Assets       15,247,517    603,118  5.29%   14,576,623    670,293  6.14%

Noninterest-
 earning assets:
  Cash and
   due from
   banks           301,009                        318,844
  Premises
   and
   equipment       203,919                        196,977
  Other
   assets          940,974                        948,134
  Less:
   allowance
   for loan
   losses         (211,105)                      (116,598)
              ------------                   ------------

  Total
   Assets     $ 16,482,314                   $ 15,923,980
              ============                   ============

LIABILITIES
 AND
 SHAREHOLDERS'
 EQUITY

Interest-bearing
 liabilities:
  Demand
   deposits   $  1,819,135  $   5,896  0.43% $  1,709,380  $  10,538  0.82%
  Savings
   deposits      2,309,103     13,941  0.81%    2,179,432     22,396  1.37%
  Time
   deposits      5,538,068    121,890  2.94%    4,396,409    128,873  3.92%
              ------------  ---------  ----  ------------  ---------  ----

  Total
   Interest-
   bearing
   Deposits      9,666,306    141,727  1.96%    8,285,221    161,807  2.61%

  Short-term
   borrowings    1,186,568      3,193  0.36%    2,365,052     44,093  2.46%
  Federal
   Home Loan
   Bank
   advances
   and
   long-term
   debt          1,754,010     61,744  4.71%    1,829,981     60,714  4.43%
              ------------  ---------  ----  ------------  ---------  ----

  Total
   Interest-
   bearing
   Liabilities  12,606,884    206,664  2.19%   12,480,254    266,614  2.85%

Noninterest-
 bearing
 liabilities:

  Demand
   deposits      1,798,522                      1,649,560
  Other            202,209                        190,487
              ------------                   ------------

  Total
   Liabilities  14,607,615                     14,320,301

  Shareholders'
   equity        1,874,699                      1,603,679
              ------------                   ------------
  Total
   Liabilities
   and
   Shareholders'
   Equity     $ 16,482,314                   $ 15,923,980
              ============                   ============

  Net
   interest
   income/net
   interest
   margin
   (fully
   taxable
   equivalent)                396,454  3.48%                 403,679  3.71%
                                       ====                           ====
  Tax
   equivalent
   adjustment                 (11,593)                       (11,872)
                            ---------                      ---------
  Net
   interest
   income                   $ 384,861                      $ 391,807
                            =========                      =========

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




AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:


                        Nine Months Ended
                           September 30
                    ---------------------------
                        2009          2008       % Change
                    ------------- ------------- -----------

Loans, by type:
  Real estate -
   commercial
   mortgage         $   4,100,119 $   3,673,874        11.6%
  Commercial -
   industrial,
   financial and
   agricultural         3,660,083     3,504,467         4.4%
  Real estate -
   home equity          1,672,678     1,571,567         6.4%
  Real estate -
   construction         1,143,476     1,332,548       (14.2%)
  Real estate -
   residential
   mortgage               942,407       898,875         4.8%
  Consumer                368,109       406,196        (9.4%)
  Leasing and other        84,506        85,221        (0.8%)
                    ------------- -------------

  Total Loans, net
   of unearned
   income           $  11,971,378 $  11,472,748         4.3%
                    ============= =============

Deposits, by type:
  Noninterest-bearing
   demand           $   1,798,522 $   1,649,560         9.0%
  Interest-bearing
   demand               1,819,135     1,709,380         6.4%
  Savings deposits      2,309,103     2,179,432         5.9%
  Time deposits         5,538,068     4,396,409        26.0%
                    ------------- -------------

  Total Deposits    $  11,464,828 $   9,934,781        15.4%
                    ============= =============

Short-term
 borrowings, by
 type:
  Federal funds
   purchased        $     571,864 $   1,296,074       (55.9%)
  Short-term
   promissory notes       297,831       475,523       (37.4%)
  Customer
   repurchase
   agreements             252,539       221,253        14.1%
  Federal Reserve
   Bank borrowings         61,685             -         N/A
  Overnight
   borrowings and
   other                    2,649       372,202       (99.3%)
                    ------------- -------------

  Total Short-term
   borrowings       $   1,186,568 $   2,365,052       (49.8%)
                    ============= =============

N/A - Not Applicable



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

                            Quarter Ended
                ------------------------------------   Nine Months Ended
                                                          September 30
                September 30 September 30  June 30   ---------------------
                    2009         2008        2009       2009       2008
                ------------ ------------ ---------- ---------- ----------
ALLOWANCE FOR
 CREDIT LOSSES:
  Balance at
   beginning of
   period       $    220,954 $    126,223 $  200,063 $  180,137 $  112,209
  Loans charged
   off:
    Real estate -
     construction     (9,356)      (2,733)    (11,294)   (32,892)   (3,014)
    Commercial -
     industrial,
     agricultural
     and
     financial        (7,787)      (4,684)    (6,274)   (24,683)   (12,200)
    Real estate -
     commercial
     mortgage         (3,554)      (2,405)    (5,961)   (13,475)    (2,828)
    Real estate -
     residential
     mortgage
     and home
     equity           (1,065)        (719)    (1,830)    (4,832)    (2,969)
    Consumer          (2,527)        (991)    (3,064)    (7,667)    (3,738)
    Leasing and
     other            (1,637)      (1,166)    (2,099)    (4,682)    (3,771)
                ------------ ------------ ---------- ---------- ----------
    Total loans
     charged off     (25,926)     (12,698)   (30,522)   (88,231)   (28,520)
  Recoveries of
   loans charged
   off:
    Real estate -
     construction         26           17        214        352         17
    Commercial -
     industrial,
     agricultural
     and
     financial           444          749        306      1,654      1,025
    Real estate -
     commercial
     mortgage            493           88         25        528        230
    Real estate -
     residential
     mortgage
     and home
     equity                1          133        147        149        138
    Consumer             354          304        511      1,294      1,022
    Leasing and
     other               375          313        210        838      1,082
                ------------ ------------ ---------- ---------- ----------
    Recoveries
     of loans
     previously
     charged off       1,693        1,604      1,413      4,815      3,514
                ------------ ------------ ---------- ---------- ----------
  Net loans
   charged off       (24,233)     (11,094)   (29,109)   (83,416)   (25,006)
  Provision for
   loan losses        45,000       26,700     50,000    145,000     54,626
                ------------ ------------ ---------- ---------- ----------
  Balance at end
   of period    $    241,721 $    141,829 $  220,954 $  241,721 $  141,829
                ============ ============ ========== ========== ==========

  Net charge-offs
   to average
   loans
   (annualized)         0.81%        0.38%      0.97%      0.93%      0.29%
                ============ ============ ========== ========== ==========

COMPONENTS OF
 ALLOWANCE FOR
 CREDIT LOSSES:
  Allowance for
   loan losses  $    234,511 $    136,988 $  214,170
  Reserve for
   unfunded
   lending
   commitments         7,210        4,841      6,784
                ------------ ------------ ----------
  Allowance for
   credit
   losses       $    241,721 $    141,829 $  220,954
                ============ ============ ==========



NON-PERFORMING
 ASSETS:
  Non-accrual
   loans        $    228,961 $    143,310 $  228,132
  Loans 90 days
   past due and
   accruing           52,797       21,354     39,135
                ------------ ------------ ----------
    Total
     non-
     performing
     loans           281,758      164,664    267,267
  Other real
   estate owned       19,151       21,706     24,916
                ------------ ------------ ----------
  Total
   non-
   performing
   assets       $    300,909 $    186,370 $  292,183
                ============ ============ ==========

NON-PERFORMING
 LOANS, BY TYPE:
  Real estate -
   construction $    104,789 $     57,436 $  102,977
  Commercial -
   industrial,
   agricultural
   and financial      63,217       41,489     58,433
  Real estate -
   commercial
   mortgage           54,930       32,642     57,786
  Real estate -
   residential
   mortgage and
   home equity        46,192       26,274     37,231
  Consumer            12,292        6,558      9,764
  Leasing                338          265      1,076
                ------------ ------------ ----------
  Total
   non-
   performing
   loans        $    281,758 $    164,664 $  267,267
                ============ ============ ==========

ASSET QUALITY
 RATIOS:
  Non-accrual
   loans to
   total loans          1.91%        1.21%      1.92%
  Non-performing
   assets to
   total loans
   and OREO             2.51%        1.57%      2.46%
  Non-performing
   assets to
   total assets         1.82%        1.15%      1.73%
  Allowance for
   credit losses
   to loans
   outstanding          2.02%        1.20%      1.86%
  Allowance for
   loan losses
   to loans
   outstanding          1.96%        1.16%      1.80%
  Allowance for
   credit losses
   to
   non-
   performing
   loans               85.79%       86.13%     82.67%
  Non-performing
   assets to
   tangible
   common
   shareholders'
   equity and
   allowance
   for credit
   losses              24.24%       17.00%     24.99%

Contact Information

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