SOURCE: United Community Banks, Inc.

United Community Banks, Inc.

July 28, 2011 05:30 ET

United Community Banks, Inc. Reports Earnings of $7.6 Million or Eight Cents per Share for Second Quarter 2011

BLAIRSVILLE, GA--(Marketwire - Jul 28, 2011) - United Community Banks, Inc. (NASDAQ: UCBI)

  • Profitable quarter driven by core earnings and lower credit losses
  • Nonperforming assets continue to improve; down $19 million, or 14 percent, from last quarter to 1.60 percent of assets
  • Allowance for loan losses remains strong at 3.07 percent of loans
  • Core transaction deposits up 10 percent on an annualized basis
  • Completed conversion of preferred stock to common and reverse stock split

United Community Banks, Inc. (NASDAQ: UCBI) today reported net income of $7.6 million, or 8 cents per diluted share, for the second quarter of 2011. The year-to-date net loss of $135 million reflects the significant credit losses in the first quarter incurred in connection with the Problem Asset Disposition Plan which was announced last quarter in conjunction with the raising of $380 million in new capital.

"The de-risking of our balance sheet and capital transaction, coupled with the execution of the Problem Asset Disposition Plan in the first quarter allowed us to return to profitability much sooner than would have otherwise been feasible," stated Jimmy Tallent, president and chief executive officer. "While we still have work to do in this difficult economic environment, our credit trends show improvement by every measure and we expect that positive trend to continue."

Total loans were $4.2 billion at quarter-end, down $31 million from the end of the first quarter and $710 million from a year earlier. "The $31 million decrease from last quarter is actually a very encouraging sign in that it is the smallest quarterly decrease in loan balances since the first quarter of 2008," stated Tallent. "We believe the slowing attrition in the loan portfolio marks the approach of an inflection point upon which we can once again begin to grow our loan portfolio. We were pleased with our new loans made during the second quarter that included $136 million of loan commitments with $105 million funded of which the majority were commercial loans. Our pipeline of new business continues to gain momentum and we continue to add commercial lenders to our metro markets across our footprint. I'm encouraged by the direction in which we are heading. I can't overemphasize the importance of restoring modest growth to our loan portfolio and growing net interest revenue."

Taxable equivalent net interest revenue of $58.9 million was up $2.6 million from the first quarter due mostly to the impact last quarter of a $2 million interest reversal on the performing classified loans that were included in the bulk loan sale. Compared with the second quarter of 2010, net interest revenue was $2.7 million lower, primarily due to the $745 million reduction in average loan balances that was offset partially by lower rates on our deposits. Net interest margin was 3.41 percent for the second quarter of 2011, down 19 basis points from a year ago and equal to the first quarter after adding back the $2 million interest reversal in the bulk loan sale.

"Growing loans and deposits is the key to building core earnings," Tallent commented. "We are making steady progress on the lending side and grew core transaction deposits in the second quarter by $69 million, or 10 percent, on an annualized basis. This was the tenth consecutive quarter of core deposit growth."

Operating fee revenue was $13.9 million in the second quarter of 2011, compared to $11.6 million a year ago and $11.8 million last quarter. Service charges and fees were $7.6 million, down $385,000 from a year ago, due primarily to lower overdraft fees resulting from regulatory changes last year that required customers to provide consent before using overdraft services. Partially offsetting this reduction in overdraft fees was an increase in ATM and debit card usage fees. Service charges and fees were up $888,000 from last quarter due to the increase in ATM and debit card usage fees. Mortgage fees of $952,000 were down $649,000 from a year ago and down $542,000 from last quarter due to the lower level of refinancing activities. Other fee revenue of $4.7 million reflected an increase of $3.3 million from a year ago and $1.8 million from the first quarter primarily due to the accelerated recognition of deferred gains relating to the ineffectiveness of terminated cash flow hedges on certain prime-based loans. Gains recognized in the second quarter were $2.8 million compared with $1.3 million in the first quarter of 2011 and $239,000 in the second quarter of 2010.

Excluding foreclosed property costs and the loss on sale of nonperforming assets in 2010, the second quarter operating expenses were $46.8 million, flat with the first quarter and $3.1 million higher than a year ago. Salary and benefit costs totaled $26.4 million and increased $2.8 million from last year and $1.5 million from first quarter. Severance costs for eliminated staff positions account for $1.2 million of the increase from both periods. Also contributing to the increase from a year ago were $717,000 in higher incentive costs, lower deferred direct loan origination costs of $518,000 and a $288,000 change in the value of our deferred compensation liability.

Foreclosed property costs for the second quarter of 2011 were $1.9 million as compared to $64.9 million last quarter and $14.5 million a year ago. For the second quarter of 2011, these costs were for maintenance of foreclosed properties. For the first quarter of 2011, foreclosed property costs included $60.6 million of write downs and losses on accelerated sales related to the asset disposition plan and $4.3 million of maintenance costs. Second quarter 2010 included $11.2 million of write downs and losses and $3.3 million for maintenance costs.

The effective tax rate for the second quarter of 2011 was 40 percent, equal to the first quarter of 2011. The effective tax rate for the balance of 2011 will continue in the 40 percent range due to year-to-date net losses and will return to a normal range of 35 to 36 percent with expected profitability for 2012.

As of June 30, 2011, the capital ratios for United were as follows: Tier 1 Risk Based of 13.9 percent; Tier 1 Leverage of 8.7 percent; and, Total Risk Based of 16.4 percent. The quarterly average tangible equity-to-assets ratio was 11.1 percent. As of quarter-end, tangible common equity-to-assets ratio was 8.9 percent compared to the quarterly average of 4.8 percent which was distorted by the late-quarter timing of the conversion of the mandatorily convertible preferred stock that occurred late in the quarter. The quarter-end tangible common equity to assets ratio of 8.9 percent is more representative of United's current capital strength.

"It is of course good to once again report positive earnings," Tallent said. "The last three years have been extremely challenging in our industry, and challenges remain as the economy continues to struggle. We have laid out our strategy and now we are about the business of implementation. Our company has completed the capital transaction, de-risked our balance sheet through the Problem Asset Disposition Plan, executed the reverse stock split, and achieved profitability. We are on the right track but by no means satisfied; there is more work to do on credit quality, commercial loans, core deposits, customer service, and organic growth. We are moving forward with determination and optimism."

Conference Call
United Community Banks will hold a conference call today, Thursday, July 28, 2011, at 11 a.m. ET to discuss the contents of this news release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the conference number 78907241. The conference call also will be webcast and can be accessed by selecting 'Calendar of Events' within the Investor Relations section of the company's website at www.ucbi.com.

About United Community Banks, Inc.
Headquartered in Blairsville, United Community Banks is the third-largest bank holding company in Georgia. United Community Banks has assets of $7.4 billion and operates 27 community banks with 106 banking offices throughout north Georgia, the Atlanta region, coastal Georgia, western North Carolina and east Tennessee. The Company specializes in providing personalized community banking services to individuals and small to mid-size businesses. United Community Banks also offers the convenience of 24-hour access through a network of ATMs, telephone and on-line banking. United Community Banks common stock is listed on the Nasdaq Global Select Market under the symbol UCBI. Additional information may be found at the Company's web site at www.ucbi.com.

Safe Harbor
This news release contains forward-looking statements, as defined by Federal Securities Laws, including statements about financial United's outlook and business environment. These statements are provided to assist in the understanding of future financial performance and such performance involves risks and uncertainties that may cause actual results to differ materially from those anticipated in such statements. Any such statements are based on current expectations and involve a number of risks and uncertainties. For a discussion of some factors that may cause such forward-looking statements to differ materially from actual results, please refer to the section entitled "Risk Factors" of United Community Banks, Inc.'s annual report filed on Form 10-K with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements.

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
2011 2010
(in thousands, except per share Second First Fourth Third Second
data; taxable equivalent) Quarter Quarter Quarter Quarter Quarter
INCOME SUMMARY
Interest revenue $ 76,931 $ 75,965 $ 81,215 $ 84,360 $ 87,699
Interest expense 17,985 19,573 21,083 24,346 26,072
Net interest revenue 58,946 56,392 60,132 60,014 61,627
Operating provision for loan losses (1) 11,000 190,000 47,750 50,500 61,500
Fee revenue (2) 13,905 11,838 12,442 12,861 11,579
Total operating revenue (1)(2) 61,851 (121,770 ) 24,824 22,375 11,706
Operating expenses (3) 48,728 115,271 64,918 64,906 58,308
Loss on sale of nonperforming assets - - - - 45,349
Operating income (loss) from continuing operations before income taxes 13,123 (237,041 ) (40,094 ) (42,531 ) (91,951 )
Operating income tax expense (benefit) 5,506 (94,555 ) (16,520 ) (16,706 ) (32,419 )
Net operating income (loss) from continuing operations (1)(2)(3) 7,617 (142,486 ) (23,574 ) (25,825 ) (59,532 )
Noncash goodwill impairment charges - - - (210,590 ) -
Partial reversal of fraud loss provision, net of income tax - - 7,179 - -
Loss from discontinued operations, net of income tax - - - - -
Gain from sale of subsidiary, net income tax - - - - -
Net income (loss) 7,617 (142,486 ) (16,395 ) (236,415 ) (59,532 )
Preferred dividends and discount accretion 3,016 2,778 2,586 2,581 2,577
Net income (loss) available to common shareholders $ 4,601 $ (145,264 ) $ (18,981 ) $ (238,996 ) $ (62,109 )
PERFORMANCE MEASURES
Per common share:
Diluted operating income (loss) from continuing operations (1)(2)(3) $ .08 $ (7.87 ) $ (1.38 ) $ (1.50 ) $ (3.29 )
Diluted income (loss) from continuing operations .08 (7.87 ) (1.00 ) (12.62 ) (3.29 )
Diluted income (loss) .08 (7.87 ) (1.00 ) (12.62 ) (3.29 )
Book value 11.59 14.78 24.18 25.70 38.55
Tangible book value (5) 11.47 14.44 23.78 25.26 26.95
Key performance ratios:
Return on equity (4)(6) 5.34 % (147.11 ) % (17.16 ) % (148.04 ) % (35.89 ) %
Return on assets (6) .40 (7.61 ) (.89 ) (12.47 ) (3.10 )
Net interest margin (6) 3.41 3.30 3.58 3.57 3.60
Operating efficiency ratio from continuing operations (2)(3) 66.88 169.08 89.45 89.38 141.60
Equity to assets 11.21 8.82 8.85 11.37 11.84
Tangible equity to assets (5) 11.13 8.73 8.75 9.19 9.26
Tangible common equity to assets (5) 4.79 5.51 6.35 6.78 6.91
Tangible common equity to risk-weighted assets (5) 14.26 6.40 9.05 9.60 9.97
ASSET QUALITY *
Non-performing loans $ 71,065 $ 83,769 $ 179,094 $ 217,766 $ 224,335
Foreclosed properties 47,584 54,378 142,208 129,964 123,910
Total non-performing assets (NPAs) 118,649 138,147 321,302 347,730 348,245
Allowance for loan losses 127,638 133,121 174,695 174,613 174,111
Operating net charge-offs (1) 16,483 231,574 47,668 49,998 61,323
Allowance for loan losses to loans 3.07 % 3.17 % 3.79 % 3.67 % 3.57 %
Operating net charge-offs to average loans (1)(6) 1.58 20.71 4.03 4.12 4.98
NPAs to loans and foreclosed properties 2.82 3.25 6.77 7.11 6.97
NPAs to total assets 1.60 1.73 4.32 4.96 4.55
AVERAGE BALANCES ($ in millions)
Loans $ 4,266 $ 4,599 $ 4,768 $ 4,896 $ 5,011
Investment securities 2,074 1,625 1,354 1,411 1,532
Earning assets 6,924 6,902 6,680 6,676 6,854
Total assets 7,624 7,595 7,338 7,522 7,704
Deposits 6,372 6,560 6,294 6,257 6,375
Shareholders' equity 854 670 649 855 912
Common shares - basic (thousands) 25,427 18,466 18,984 18,936 18,905
Common shares - diluted (thousands) 57,543 18,466 18,984 18,936 18,905
AT PERIOD END ($ in millions)
Loans * $ 4,163 $ 4,194 $ 4,604 $ 4,760 $ 4,873
Investment securities 2,188 1,884 1,490 1,310 1,488
Total assets 7,410 7,974 7,443 7,013 7,652
Deposits 6,183 6,598 6,469 5,999 6,330
Shareholders' equity 860 850 636 662 904
Common shares outstanding (thousands) 57,469 20,903 18,937 18,887 18,856
(1) Excludes the partial reversal of a previously established provision for fraud-related loan losses of $11.8 million, net of tax expense of $4.6 million in the fourth quarter of 2010. Operating charge-offs also exclude the $11.8 million related partial recovery of the previously charged off amount. (2) Excludes revenue generated by discontinued operations in the first quarter of 2010. (3) Excludes the goodwill impairment charge of $211 million in the third quarter of 2010 and expenses relating to discontinued operations in the first quarter of 2010. (4) Net loss available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss). (5) Excludes effect of acquisition related intangibles and associated amortization. (6) Annualized.
* Excludes loans and foreclosed properties covered by loss sharing agreements with the FDIC.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
(in thousands, except per share data; taxable equivalent) 2011 2010
Second
Quarter
2011-2010

Change

For the Six
Months Ended

YTD
2011-2010

Change
Second
Quarter
Second
Quarter
2011 2010
INCOME SUMMARY
Interest revenue $ 76,931 $ 87,699 $ 152,896 $ 177,548
Interest expense 17,985 26,072 37,558 54,642
Net interest revenue 58,946 61,627 (4 )% 115,338 122,906 (6 )%
Operating provision for loan losses (1) 11,000 61,500 201,000 136,500
Fee revenue (2) 13,905 11,579 20 25,743 23,245 11
Total operating revenue (1)(2) 61,851 11,706 (59,919 ) 9,651
Operating expenses (3) 48,728 58,308 (16 ) 163,999 113,128 45
Loss on sale of nonperforming assets - 45,349 - 45,349
Operating income (loss) from continuing operations before income taxes 13,123 (91,951 ) 114 (223,918 ) (148,826 )
Operating income tax expense (benefit) 5,506 (32,419 ) (89,049 ) (54,836 )
Net operating income (loss) from continuing operations
(1)(2)(3)
7,617 (59,532 ) 113 (134,869 ) (93,990 ) (43 )
Noncash goodwill impairment charges - - - -
Partial reversal of fraud loss provision, net of income tax - - - -
Loss from discontinued operations, net of income tax - - - (101 )
Gain from sale of subsidiary, net income tax - - - 1,266
Net income (loss) 7,617 (59,532 ) 113 (134,869 ) (92,825 ) (45 )
Preferred dividends and discount accretion 3,016 2,577 5,794 5,149
Net income (loss) available to common shareholders $ 4,601 $ (62,109 ) $ (140,663 ) $ (97,974 )
PERFORMANCE MEASURES
Per common share:
Diluted operating income (loss) from continuing operations (1)(2)(3) $ .08 $ (3.29 ) 102 $ (6.40 ) $ (5.25 ) (22 )
Diluted income (loss) from continuing operations .08 (3.29 ) 102 (6.40 ) (5.25 ) (22 )
Diluted income (loss) .08 (3.29 ) 102 (6.40 ) (5.19 ) (23 )
Book value 11.59 38.55 (70 ) 11.59 38.55 (70 )
Tangible book value (5) 11.47 26.95 (57 ) 11.47 26.95 (57 )
Key performance ratios:
Return on equity (4)(6) 5.34 % (35.89 )% (76.07 )% (27.87 )%
Return on assets (6) .40 (3.10 ) (3.57 ) (2.39 )
Net interest margin (6) 3.41 3.60 3.36 3.55
Operating efficiency ratio from continuing operations (2)(3) 66.88 141.60 116.28 108.48
Equity to assets 11.21 11.84 10.02 11.87
Tangible equity to assets (5) 11.13 9.26 9.94 9.32
Tangible common equity to assets (5) 4.79 6.91 5.15 7.02
Tangible common equity to risk-weighted assets (5) 14.26 9.97 14.26 9.97
ASSET QUALITY *
Non-performing loans $ 71,065 $ 224,335 $ 71,065 $ 224,335
Foreclosed properties 47,584 123,910 47,584 123,910
Total non-performing assets (NPAs) 118,649 348,245 118,649 348,245
Allowance for loan losses 127,638 174,111 127,638 174,111
Operating net charge-offs (1) 16,483 61,323 248,057 117,991
Allowance for loan losses to loans 3.07 % 3.57 % 3.07 % 3.57 %
Operating net charge-offs to average loans (1)(6) 1.58 4.98 11.46 4.75
NPAs to loans and foreclosed properties 2.82 6.97 2.82 6.97
NPAs to total assets 1.60 4.55 1.60 4.55
AVERAGE BALANCES ($ in millions)
Loans $ 4,266 $ 5,011 (15 ) $ 4,432 $ 5,091 (13 )
Investment securities 2,074 1,532 35 1,851 1,525 21
Earning assets 6,924 6,854 1 6,913 6,969 (1 )
Total assets 7,624 7,704 (1 ) 7,609 7,825 (3 )
Deposits 6,372 6,375 - 6,465 6,472 -
Shareholders' equity 854 912 (6 ) 763 929 (18 )
Common shares - basic (thousands) 25,427 18,905 21,965 18,891
Common shares - diluted (thousands) 57,543 18,905 21,965 18,891
AT PERIOD END ($ in millions)
Loans * $ 4,163 $ 4,873 (15 ) $ 4,163 $ 4,873 (15 )
Investment securities 2,188 1,488 47 2,188 1,488 47
Total assets 7,410 7,652 (3 ) 7,410 7,652 (3 )
Deposits 6,183 6,330 (2 ) 6,183 6,330 (2 )
Shareholders' equity 860 904 (5 ) 860 904 (5 )
Common shares outstanding (thousands) 57,469 18,856 57,469 18,856
(1) Excludes the partial reversal of a previously established provision for fraud-related loan losses of $11.8 million, net of tax expense of $4.6 million in the fourth quarter of 2010. Operating charge-offs also exclude the $11.8 million related partial recovery of the previously charged off amount. (2) Excludes revenue generated by discontinued operations in the first quarter of 2010. (3) Excludes the goodwill impairment charge of $211 million in the third quarter of 2010 and expenses relating to discontinued operations in the first quarter of 2010. (4) Net loss available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss). (5) Excludes effect of acquisition related intangibles and associated amortization. (6) Annualized.
* Excludes loans and foreclosed properties covered by loss sharing agreements with the FDIC.
UNITED COMMUNITY BANKS, INC.
Operating Earnings to GAAP Earnings Reconciliation
Selected Financial Information
2011 2010
(in thousands, except per share data; taxable equivalent) Second First Fourth Third Second
Quarter Quarter Quarter Quarter Quarter
Interest revenue reconciliation
Interest revenue - taxable equivalent $ 76,931 $ 75,965 $ 81,215 $ 84,360 $ 87,699
Taxable equivalent adjustment (429 ) (435 ) (497 ) (511 ) (500 )
Interest revenue (GAAP) $ 76,502 $ 75,530 $ 80,718 $ 83,849 $ 87,199
Net interest revenue reconciliation
Net interest revenue - taxable equivalent $ 58,946 $ 56,392 $ 60,132 $ 60,014 $ 61,627
Taxable equivalent adjustment (429 ) (435 ) (497 ) (511 ) (500 )
Net interest revenue (GAAP) $ 58,517 $ 55,957 $ 59,635 $ 59,503 $ 61,127
Provision for loan losses reconciliation
Operating provision for loan losses $ 11,000 $ 190,000 $ 47,750 $ 50,500 $ 61,500
Partial reversal of special fraud-related provision for loan loss - - (11,750 ) - -
Provision for loan losses (GAAP) $ 11,000 $ 190,000 $ 36,000 $ 50,500 $ 61,500
Total revenue reconciliation
Total operating revenue $ 61,851 $ (121,770 ) $ 24,824 $ 22,375 $ 11,706
Taxable equivalent adjustment (429 ) (435 ) (497 ) (511 ) (500 )
Partial reversal of special fraud-related provision for loan loss - - 11,750 - -
Total revenue (GAAP) $ 61,422 $ (122,205 ) $ 36,077 $ 21,864 $ 11,206
Expense reconciliation
Operating expense $ 48,728 $ 115,271 $ 64,918 $ 64,906 $ 103,657
Noncash goodwill impairment charge - - - 210,590 -
Operating expense (GAAP) $ 48,728 $ 115,271 $ 64,918 $ 275,496 $ 103,657
Income (loss) from continuing operations before taxes reconciliation
Operating income (loss) from continuing operations before taxes $ 13,123 $ (237,041 ) $ (40,094 ) $ (42,531 ) $ (91,951 )
Taxable equivalent adjustment (429 ) (435 ) (497 ) (511 ) (500 )
Noncash goodwill impairment charge - - - (210,590 ) -
Partial reversal of special fraud-related provision for loan loss - - 11,750 - -
Income (loss) from continuing operations before taxes (GAAP) $ 12,694 $ (237,476 ) $ (28,841 ) $ (253,632 ) $ (92,451 )
Income tax expense (benefit) reconciliation
Operating income tax expense (benefit) $ 5,506 $ (94,555 ) $ (16,520 ) $ (16,706 ) $ (32,419 )
Taxable equivalent adjustment (429 ) (435 ) (497 ) (511 ) (500 )
Partial reversal of special fraud-related provision for loan loss - - 4,571 - -
Income tax expense (benefit) (GAAP) $ 5,077 $ (94,990 ) $ (12,446 ) $ (17,217 ) $ (32,919 )
Diluted earnings (loss) from continuing operations per common share reconciliation
Diluted operating earnings (loss) from continuing operations per common share $ .08 $ (7.87 ) $ (1.38 ) $ (1.50 ) $ (3.29 )
Noncash goodwill impairment charge - - - (11.12 ) -
Partial reversal of special fraud-related provision for loan loss - - .38 - -
Diluted earnings (loss) from continuing operations per common share (GAAP) $ .08 $ (7.87 ) $ (1.00 ) $ (12.62 ) $ (3.29 )
Book value per common share reconciliation
Tangible book value per common share $ 11.47 $ 14.44 $ 23.78 $ 25.26 $ 26.95
Effect of goodwill and other intangibles .12 .34 .40 .44 11.60
Book value per common share (GAAP) $ 11.59 $ 14.78 $ 24.18 $ 25.70 $ 38.55
Efficiency ratio from continuing operations reconciliation
Operating efficiency ratio from continuing operations 66.88 % 169.08 % 89.45 % 89.38 % 141.60 %
Noncash goodwill impairment charge - - - 290.00 -
Efficiency ratio from continuing operations (GAAP) 66.88 % 169.08 % 89.45 % 379.38 % 141.60 %
Average equity to assets reconciliation
Tangible common equity to assets 4.79 % 5.51 % 6.35 % 6.78 % 6.91 %
Effect of preferred equity 6.34 3.22 2.40 2.41 2.35
Tangible equity to assets 11.13 8.73 8.75 9.19 9.26
Effect of goodwill and other intangibles .08 .09 .10 2.18 2.58
Equity to assets (GAAP) 11.21 % 8.82 % 8.85 % 11.37 % 11.84 %
Actual tangible common equity to risk-weighted assets reconciliation
Tangible common equity to risk-weighted assets 14.26 % 6.40 % 9.05 % 9.60 % 9.97 %
Effect of other comprehensive income (.65 ) (.58 ) (.62 ) (.81 ) (.87 )
Effect of deferred tax limitation (5.04 ) (5.10 ) (3.34 ) (2.94 ) (2.47 )
Effect of trust preferred 1.14 1.12 1.06 1.06 1.03
Effect of preferred equity 4.17 5.97 3.52 3.51 3.41
Tier I capital ratio (Regulatory) 13.88 % 7.81 % 9.67 % 10.42 % 11.07 %
Net charge-offs reconciliation
Operating net charge-offs $ 16,483 $ 231,574 $ 47,668 $ 49,998 $ 61,323
Subsequent partial recovery of fraud-related charge-off - - (11,750 ) - -
Net charge-offs (GAAP) $ 16,483 $ 231,574 $ 35,918 $ 49,998 $ 61,323
Net charge-offs to average loans reconciliation
Operating net charge-offs to average loans 1.58 % 20.71 % 4.03 % 4.12 % 4.98 %
Subsequent partial recovery of fraud-related charge-off - - (1.00 ) - -
Net charge-offs to average loans (GAAP) 1.58 % 20.71 % 3.03 % 4.12 % 4.98 %
UNITED COMMUNITY BANKS, INC.
Operating Earnings to GAAP Earnings Reconciliation
Selected Financial Information
For the Six Months Ended
(in thousands, except per share
data; taxable equivalent)
2011 2010
Interest revenue reconciliation
Interest revenue - taxable equivalent $ 152,896 $ 177,548
Taxable equivalent adjustment (864 ) (993 )
Interest revenue (GAAP) $ 152,032 $ 176,555
Net interest revenue reconciliation
Net interest revenue - taxable equivalent $ 115,338 $ 122,906
Taxable equivalent adjustment (864 ) (993 )
Net interest revenue (GAAP) $ 114,474 $ 121,913
Provision for loan losses reconciliation
Operating provision for loan losses $ 201,000 $ 136,500
Partial reversal of special fraud-related provision for loan loss - -
Provision for loan losses (GAAP) $ 201,000 $ 136,500
Total revenue reconciliation
Total operating revenue $ (59,919 ) $ 9,651
Taxable equivalent adjustment (864 ) (993 )
Partial reversal of special fraud-related provision for loan loss - -
Total revenue (GAAP) $ (60,783 ) $ 8,658
Expense reconciliation
Operating expense $ 163,999 $ 158,477
Noncash goodwill impairment charge - -
Operating expense (GAAP) $ 163,999 $ 158,477
Income (loss) from continuing operations before taxes reconciliation
Operating income (loss) from continuing operations before taxes $ (223,918 ) $ (148,826 )
Taxable equivalent adjustment (864 ) (993 )
Noncash goodwill impairment charge - -
Partial reversal of special fraud-related provision for loan loss - -
Income (loss) from continuing operations before taxes (GAAP) $ (224,782 ) $ (149,819 )
Income tax expense (benefit) reconciliation
Operating income tax expense (benefit) $ (89,049 ) $ (54,836 )
Taxable equivalent adjustment (864 ) (993 )
Partial reversal of special fraud-related provision for loan loss - -
Income tax expense (benefit) (GAAP) $ (89,913 ) $ (55,829 )
Diluted earnings (loss) from continuing operations per common share reconciliation
Diluted operating earnings (loss) from continuing operations per common share $ (6.40 ) $ (5.25 )
Noncash goodwill impairment charge - -
Partial reversal of special fraud-related provision for loan loss - -
Diluted earnings (loss) from continuing operations per common share (GAAP) $ (6.40 ) $ (5.25 )
Book value per common share reconciliation
Tangible book value per common share $ 11.47 $ 26.95
Effect of goodwill and other intangibles .12 11.60
Book value per common share (GAAP) $ 11.59 $ 38.55
Efficiency ratio from continuing operations reconciliation
Operating efficiency ratio from continuing operations % 116.28 % 108.48 %
Noncash goodwill impairment charge - -
Efficiency ratio from continuing operations (GAAP) % 116.28 % 108.48 %
Average equity to assets reconciliation
Tangible common equity to assets % 5.15 % 7.02 %
Effect of preferred equity 4.79 2.30
Tangible equity to assets 9.94 9.32
Effect of goodwill and other intangibles .08 2.55
Equity to assets (GAAP) % 10.02 % 11.87 %
Actual tangible common equity to risk-weighted assets reconciliation
Tangible common equity to risk-weighted assets % 14.26 % 9.97 %
Effect of other comprehensive income (.65 ) (.87 )
Effect of deferred tax limitation (5.04 ) (2.47 )
Effect of trust preferred 1.14 1.03
Effect of preferred equity 4.17 3.41
Tier I capital ratio (Regulatory) % 13.88 % 11.07 %
Net charge-offs reconciliation
Operating net charge-offs $ 248,057 $ 117,991
Subsequent partial recovery of fraud-related charge-off - -
Net charge-offs (GAAP) $ 248,057 $ 117,991
Net charge-offs to average loans reconciliation
Operating net charge-offs to average loans % 11.46 % 4.75 %
Subsequent partial recovery of fraud-related charge-off - -
Net charge-offs to average loans (GAAP) % 11.46 % 4.75 %
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End (1)
2011 2010
Second First Fourth Third Second
(in millions) Quarter Quarter Quarter Quarter Quarter
LOANS BY CATEGORY
Commercial (sec. by RE) $ 1,742 $ 1,692 $ 1,761 $ 1,781 $ 1,780
Commercial construction 195 213 297 310 342
Commercial & industrial 428 431 441 456 441
Total commercial 2,365 2,336 2,499 2,547 2,563
Residential construction 502 550 695 764 820
Residential mortgage 1,177 1,187 1,279 1,316 1,356
Consumer / installment 119 121 131 133 134
Total loans $ 4,163 $ 4,194 $ 4,604 $ 4,760 $ 4,873
LOANS BY MARKET
Atlanta MSA $ 1,188 $ 1,179 $ 1,310 $ 1,365 $ 1,373
Gainesville MSA 275 282 312 316 343
North Georgia 1,500 1,531 1,689 1,755 1,808
Western North Carolina 626 640 702 719 738
Coastal Georgia 325 312 335 345 356
East Tennessee 249 250 256 260 255
Total loans $ 4,163 $ 4,194 $ 4,604 $ 4,760 $ 4,873
RESIDENTIAL CONSTRUCTION
Dirt loans
Acquisition & development $ 105 $ 116 $ 174 $ 190 $ 214
Land loans 62 69 99 104 110
Lot loans 218 228 275 303 311
Total 385 413 548 597 635
House loans
Spec 74 88 97 109 125
Sold 43 49 50 58 60
Total 117 137 147 167 185
Total residential construction $ 502 $ 550 $ 695 $ 764 $ 820
RESIDENTIAL CONSTRUCTION - ATLANTA MSA
Dirt loans
Acquisition & development $ 20 $ 22 $ 30 $ 34 $ 40
Land loans 16 19 23 27 32
Lot loans 22 24 32 45 39
Total 58 65 85 106 111
House loans
Spec 30 34 38 42 48
Sold 9 11 10 11 10
Total 39 45 48 53 58
Total residential construction $ 97 $ 110 $ 133 $ 159 $ 169
(1) Excludes total loans of $70.8 million, $63.3 million, $68.2 million, $75.2 million and $80.8 million as of June 30, 2011, March 31, 2011, December 31, 2010, September 30, 2010 and June 30, 2010, respectively, that are covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End (1)
2011 2010

(in millions)
Second
Quarter
First
Quarter
Second
Quarter
Linked Quarter Change Year over Year Change
LOANS BY CATEGORY
Commercial (sec. by RE) $ 1,742 $ 1,692 $ 1,780 $ 50 $ (38 )
Commercial construction 195 213 342 (18 ) (147 )
Commercial & industrial 428 431 441 (3 ) (13 )
Total commercial 2,365 2,336 2,563 29 (198 )
Residential construction 502 550 820 (48 ) (318 )
Residential mortgage 1,177 1,187 1,356 (10 ) (179 )
Consumer / installment 119 121 134 (2 ) (15 )
Total loans $ 4,163 $ 4,194 $ 4,873 (31 ) (710 )
LOANS BY MARKET
Atlanta MSA $ 1,188 $ 1,179 $ 1,373 9 (185 )
Gainesville MSA 275 282 343 (7 ) (68 )
North Georgia 1,500 1,531 1,808 (31 ) (308 )
Western North Carolina 626 640 738 (14 ) (112 )
Coastal Georgia 325 312 356 13 (31 )
East Tennessee 249 250 255 (1 ) (6 )
Total loans $ 4,163 $ 4,194 $ 4,873 (31 ) (710 )
RESIDENTIAL CONSTRUCTION
Dirt loans
Acquisition & development $ 105 $ 116 $ 214 (11 ) (109 )
Land loans 62 69 110 (7 ) (48 )
Lot loans 218 228 311 (10 ) (93 )
Total 385 413 635 (28 ) (250 )
House loans
Spec 74 88 125 (14 ) (51 )
Sold 43 49 60 (6 ) (17 )
Total 117 137 185 (20 ) (68 )
Total residential construction $ 502 $ 550 $ 820 (48 ) (318 )
RESIDENTIAL CONSTRUCTION - ATLANTA MSA
Dirt loans
Acquisition & development $ 20 $ 22 $ 40 (2 ) (20 )
Land loans 16 19 32 (3 ) (16 )
Lot loans 22 24 39 (2 ) (17 )
Total 58 65 111 (7 ) (53 )
House loans
Spec 30 34 48 (4 ) (18 )
Sold 9 11 10 (2 ) (1 )
Total 39 45 58 (6 ) (19 )
Total residential construction $ 97 $ 110 $ 169 (13 ) (72 )
(1) Excludes total loans of $70.8 million, $63.3 million, $68.2 million, $75.2 million and $80.8 million as of June 30, 2011, March 31, 2011, December 31, 2010, September 30, 2010 and June 30, 2010, respectively, that are covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)
Second Quarter 2011
Non-performing
Loans
Foreclosed
Properties
Total
NPAs
(in thousands)
NPAs BY CATEGORY
Commercial (sec. by RE) $ 17,764 $ 6,796 $ 24,560
Commercial construction 2,782 6,764 9,546
Commercial & industrial 1,998 - 1,998
Total commercial 22,544 13,560 36,104
Residential construction 22,643 24,968 47,611
Residential mortgage 24,809 9,056 33,865
Consumer / installment 1,069 - 1,069
Total NPAs $ 71,065 $ 47,584 $ 118,649
Balance as a % of
Unpaid Principal 64.5 % 32.6 % 46.3 %
NPAs BY MARKET
Atlanta MSA $ 14,700 $ 11,239 $ 25,939
Gainesville MSA 4,505 3,174 7,679
North Georgia 28,117 21,278 49,395
Western North Carolina 15,153 8,953 24,106
Coastal Georgia 5,357 2,564 7,921
East Tennessee 3,233 376 3,609
Total NPAs $ 71,065 $ 47,584 $ 118,649
NPA ACTIVITY
Beginning Balance $ 83,769 $ 54,378 $ 138,147
Loans placed on non-accrual 35,911 - 35,911
Payments received (7,702 ) - (7,702 )
Loan charge-offs (18,888 ) - (18,888 )
Foreclosures (22,025 ) 22,025 -
Capitalized costs - 20 20
Note / property sales - (28,939 ) (28,939 )
Loans held for sale - - -
Write downs - (3,118 ) (3,118 )
Net losses on sales - 3,218 3,218
Ending Balance $ 71,065 $ 47,584 $ 118,649
(1) Excludes non-performing loans and foreclosed properties covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.
(2) The NPA activity shown for the first quarter of 2011 is presented with all activity related to loans transferred to the loans held for sale classification on one line as if those loans were transferred to held for sale at the beginning of the period.
(3) Includes charge-offs on loans related to United's previously announced asset disposition plan. Such charge-offs severely distorted charge off rates for the first and second quarters of 2011. A separate schedule has been included in this earnings release presenting the components of net charge-offs by loan category and geographic market for the first and second quarters of 2011.
(4) North Carolina residential construction net charge-offs for the fourth quarter of 2010 exclude a $11.8 million partial recovery of a 2007 fraud-related charge-off.
(5) Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)
First Quarter 2011 (2)

(in thousands)
Non-performing
Loans
Foreclosed
Properties
Total
NPAs
NPAs BY CATEGORY
Commercial (sec. by RE) $ 20,648 $ 7,886 $ 28,534
Commercial construction 3,701 11,568 15,269
Commercial & industrial 2,198 - 2,198
Total commercial 26,547 19,454 46,001
Residential construction 32,038 25,807 57,845
Residential mortgage 23,711 9,117 32,828
Consumer / installment 1,473 - 1,473
Total NPAs $ 83,769 $ 54,378 $ 138,147
Balance as a % of
Unpaid Principal 57.3 % 30.3 % 42.4 %
NPAs BY MARKET
Atlanta MSA $ 21,501 $ 16,913 $ 38,414
Gainesville MSA 4,332 2,157 6,489
North Georgia 30,214 23,094 53,308
Western North Carolina 18,849 7,802 26,651
Coastal Georgia 5,847 3,781 9,628
East Tennessee 3,026 631 3,657
Total NPAs $ 83,769 $ 54,378 $ 138,147
NPA ACTIVITY
Beginning Balance $ 179,094 $ 142,208 $ 321,302
Loans placed on non-accrual 54,730 - 54,730
Payments received (3,550 ) - (3,550 )
Loan charge-offs (43,969 ) - (43,969 )
Foreclosures (17,052 ) 17,052 -
Capitalized costs - 270 270
Note / property sales (11,400 ) (44,547 ) (55,947 )
Loans held for sale (74,084 ) - (74,084 )
Write downs - (48,585 ) (48,585 )
Net losses on sales - (12,020 ) (12,020 )
Ending Balance $ 83,769 $ 54,378 $ 138,147
(1) Excludes non-performing loans and foreclosed properties covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.
(2) The NPA activity shown for the first quarter of 2011 is presented with all activity related to loans transferred to the loans held for sale classification on one line as if those loans were transferred to held for sale at the beginning of the period.
(3) Includes charge-offs on loans related to United's previously announced asset disposition plan. Such charge-offs severely distorted charge off rates for the first and second quarters of 2011. A separate schedule has been included in this earnings release presenting the components of net charge-offs by loan category and geographic market for the first and second quarters of 2011.
(4) North Carolina residential construction net charge-offs for the fourth quarter of 2010 exclude a $11.8 million partial recovery of a 2007 fraud-related charge-off.
(5) Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)
Fourth Quarter 2010

(in thousands)
Non-performing
Loans
Foreclosed
Properties
Total
NPAs
NPAs BY CATEGORY
Commercial (sec. by RE) $ 44,927 $ 23,659 $ 68,586
Commercial construction 21,374 17,808 39,182
Commercial & industrial 5,611 - 5,611
Total commercial 71,912 41,467 113,379
Residential construction 54,505 78,231 132,736
Residential mortgage 51,083 22,510 73,593
Consumer / installment 1,594 - 1,594
Total NPAs $ 179,094 $ 142,208 $ 321,302
Balance as a % of
Unpaid Principal 67.2 % 64.4 % 65.9 %
NPAs BY MARKET
Atlanta MSA $ 48,289 $ 41,154 $ 89,443
Gainesville MSA 5,171 9,273 14,444
North Georgia 83,551 66,211 149,762
Western North Carolina 25,832 11,553 37,385
Coastal Georgia 11,145 11,901 23,046
East Tennessee 5,106 2,116 7,222
Total NPAs $ 179,094 $ 142,208 $ 321,302
NPA ACTIVITY
Beginning Balance $ 217,766 $ 129,964 $ 347,730
Loans placed on non-accrual 81,023 - 81,023
Payments received (7,250 ) - (7,250 )
Loan charge-offs (47,913 ) - (47,913 )
Foreclosures (61,432 ) 61,432 -
Capitalized costs - 170 170
Note / property sales (3,100 ) (33,509 ) (36,609 )
Loans held for sale - - -
Write downs - (8,031 ) (8,031 )
Net losses on sales - (7,818 ) (7,818 )
Ending Balance $ 179,094 $ 142,208 $ 321,302
(1) Excludes non-performing loans and foreclosed properties covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.
(2) The NPA activity shown for the first quarter of 2011 is presented with all activity related to loans transferred to the loans held for sale classification on one line as if those loans were transferred to held for sale at the beginning of the period.
(3) Includes charge-offs on loans related to United's previously announced asset disposition plan. Such charge-offs severely distorted charge off rates for the first and second quarters of 2011. A separate schedule has been included in this earnings release presenting the components of net charge-offs by loan category and geographic market for the first and second quarters of 2011.
(4) North Carolina residential construction net charge-offs for the fourth quarter of 2010 exclude a $11.8 million partial recovery of a 2007 fraud-related charge-off.
(5) Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality(1)
Second Quarter 2011(3) First Quarter 2011 (3) Fourth Quarter 2010 (4)
Net Charge- Net Charge- Net Charge-
Offs to Offs to Offs to
Net Average Net Average Net Average
(in thousands) Charge-Offs Loans(5) Charge-Offs Loans(5) Charge-Offs Loans(5)
NET CHARGE-OFFS BY CATEGORY
Commercial (sec. by RE) $ 3,259 .76 % $ 48,607 11.07 % $ 6,493 1.45 %
Commercial construction 869 1.70 49,715 76.95 3,924 5.12
Commercial & industrial 523 .49 4,040 3.64 2,891 2.54
Total commercial 4,651 .79 102,362 16.66 13,308 2.09
Residential construction 6,629 5.04 92,138 58.20 24,497 13.28
Residential mortgage 4,589 1.55 36,383 11.62 9,176 2.80
Consumer / installment 614 2.04 691 2.16 687 2.06
Total $ 16,483 1.58 $ 231,574 20.71 $ 47,668 4.03
NET CHARGE-OFFS BY MARKET
Atlanta MSA $ 2,920 .99 % $ 56,489 17.86 % $ 15,222 4.48 %
Gainesville MSA 2,318 3.36 8,616 11.93 3,434 4.37
North Georgia 6,575 1.72 123,305 29.66 18,537 4.26
Western North Carolina 3,522 2.21 26,447 15.61 5,154 2.87
Coastal Georgia 815 1.02 12,003 14.80 3,670 4.27
East Tennessee 333 .54 4,714 7.47 1,651 2.53
Total $ 16,483 1.58 $ 231,574 20.71 $ 47,668 4.03
(1) Excludes non-performing loans and foreclosed properties covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.
(2) The NPA activity shown for the first quarter of 2011 is presented with all activity related to loans transferred to the loans held for sale classification on one line as if those loans were transferred to held for sale at the beginning of the period.
(3) Includes charge-offs on loans related to United's previously announced asset disposition plan. Such charge-offs severely distorted charge off rates for the first and second quarters of 2011. A separate schedule has been included in this earnings release presenting the components of net charge-offs by loan category and geographic market for the first and second quarters of 2011.
(4) North Carolina residential construction net charge-offs for the fourth quarter of 2010 exclude a $11.8 million partial recovery of a 2007 fraud-related charge-off.
(5) Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Net Charge-Off Summary(1)
Second Quarter 2011
(in thousands) Other Problem Asset Disposition Plan Total
BY CATEGORY
Commercial (sec. by RE) $ 4,972 $ (1,713 ) $ 3,259
Commercial construction 2,201 (1,332 ) 869
Commercial & industrial 639 (116 ) 523
Total commercial 7,812 (3,161 ) 4,651
Residential construction 9,471 (2,842 ) 6,629
Residential mortgage 5,844 (1,255 ) 4,589
Consumer / installment 625 (11 ) 614
Total $ 23,752 $ (7,269 ) $ 16,483
BY MARKET
Atlanta MSA $ 4,875 $ (1,955 ) $ 2,920
Gainesville MSA 2,576 (258 ) 2,318
North Georgia 10,360 (3,785 ) 6,575
Western North Carolina 4,263 (741 ) 3,522
Coastal Georgia 1,206 (391 ) 815
East Tennessee 472 (139 ) 333
Total $ 23,752 $ (7,269 ) $ 16,483
(1) This schedule presents net charge-offs by loan type and geographic market separated between those charge offs related to United's first quarter 2011 Problem Asset Disposition Plan including losses on loans sold in the bulk loan sale transaction that closed on April 18, 2011 and all other charge-offs. The charge-offs on the bulk loan sale recognized in the first quarter were estimated based on indicative bids from prospective buyers. Actual losses were less than estimated resulting in an adjustment to the loss in the second quarter.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Net Charge-Off Summary(1)
First Quarter 2011
(in thousands) Other Problem Asset Disposition Plan Total
BY CATEGORY
Commercial (sec. by RE) $ 2,842 $ 45,765 $ 48,607
Commercial construction 1,146 48,569 49,715
Commercial & industrial 513 3,527 4,040
Total commercial 4,501 97,861 102,362
Residential construction 10,643 81,495 92,138
Residential mortgage 4,989 31,394 36,383
Consumer / installment 383 308 691
Total $ 20,516 $ 211,058 $ 231,574
BY MARKET
Atlanta MSA $ 3,296 $ 53,193 $ 56,489
Gainesville MSA 954 7,662 8,616
North Georgia 8,544 114,761 123,305
Western North Carolina 6,749 19,698 26,447
Coastal Georgia 341 11,662 12,003
East Tennessee 632 4,082 4,714
Total $ 20,516 $ 211,058 $ 231,574
(1) This schedule presents net charge-offs by loan type and geographic market separated between those charge offs related to United's first quarter 2011 Problem Asset Disposition Plan including losses on loans sold in the bulk loan sale transaction that closed on April 18, 2011 and all other charge-offs. The charge-offs on the bulk loan sale recognized in the first quarter were estimated based on indicative bids from prospective buyers. Actual losses were less than estimated resulting in an adjustment to the loss in the second quarter.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Net Charge-Off Summary(1)
First Six Months 2011
(in thousands) Other Problem Asset Disposition Plan Total
BY CATEGORY
Commercial (sec. by RE) $ 7,814 $ 44,052 $ 51,866
Commercial construction 3,347 47,237 50,584
Commercial & industrial 1,152 3,411 4,563
Total commercial 12,313 94,700 107,013
Residential construction 20,114 78,653 98,767
Residential mortgage 10,833 30,139 40,972
Consumer / installment 1,008 297 1,305
Total $ 44,268 $ 203,789 $ 248,057
BY MARKET
Atlanta MSA $ 8,171 $ 51,238 $ 59,409
Gainesville MSA 3,530 7,404 10,934
North Georgia 18,904 110,976 129,880
Western North Carolina 11,012 18,957 29,969
Coastal Georgia 1,547 11,271 12,818
East Tennessee 1,104 3,943 5,047
Total $ 44,268 $ 203,789 $ 248,057
(1) This schedule presents net charge-offs by loan type and geographic market separated between those charge offs related to United's first quarter 2011 Problem Asset Disposition Plan including losses on loans sold in the bulk loan sale transaction that closed on April 18, 2011 and all other charge-offs. The charge-offs on the bulk loan sale recognized in the first quarter were estimated based on indicative bids from prospective buyers. Actual losses were less than estimated resulting in an adjustment to the loss in the second quarter.
UNITED COMMUNITY BANKS, INC.
Consolidated Statement of Operations (Unaudited)
Three Months Ended
June 30,
(in thousands, except per share data) 2011 2010
Interest revenue:
Loans, including fees $ 60,958 $ 70,611
Investment securities, including tax exempt of $251, $295, $510 and $606 14,792 15,829
Federal funds sold, commercial paper and deposits in banks 752 759
Total interest revenue 76,502 87,199
Interest expense:
Deposits:
NOW 1,036 1,745
Money market 1,499 1,829
Savings 64 83
Time 10,995 17,718
Total deposit interest expense 13,594 21,375
Federal funds purchased, repurchase agreements and other short-term borrowings 1,074 1,056
Federal Home Loan Bank advances 570 974
Long-term debt 2,747 2,667
Total interest expense 17,985 26,072
Net interest revenue 58,517 61,127
Provision for loan losses 11,000 61,500
Net interest revenue after provision for loan losses 47,517 (373 )
Fee revenue:
Service charges and fees 7,608 7,993
Mortgage loan and other related fees 952 1,601
Brokerage fees 691 586
Securities gains, net 783 -
Loss from prepayment of debt (791 ) -
Other 4,662 1,399
Total fee revenue 13,905 11,579
Total revenue 61,422 11,206
Operating expenses:
Salaries and employee benefits 26,436 23,590
Communications and equipment 3,378 3,511
Occupancy 3,805 3,836
Advertising and public relations 1,317 1,352
Postage, printing and supplies 1,085 765
Professional fees 2,350 2,178
Foreclosed property 1,891 14,540
FDIC assessments and other regulatory charges 3,644 3,566
Amortization of intangibles 760 794
Other 4,062 4,176
Loss on sale of nonperforming assets - 45,349
Total operating expenses 48,728 103,657
Income (loss) from continuing operations before income taxes 12,694 (92,451 )
Income tax expense (benefit) 5,077 (32,919 )
Net income (loss) from continuing operations 7,617 (59,532 )
Loss from discontinued operations, net of income taxes - -
Gain from sale of subsidiary, net of income taxes and selling costs - -
Net income (loss) 7,617 (59,532 )
Preferred stock dividends and discount accretion 3,016 2,577
Net income (loss) available to common shareholders $ 4,601 $ (62,109 )
Earnings (loss) from continuing operations per common share - Basic $ .18 $ (3.29 )
Earnings (loss) from continuing operations per common share - Diluted