United Community Banks, Inc.
Oct 23, 2009

United Community Banks, Inc. Reports Net Operating Loss for Third Quarter 2009

BLAIRSVILLE, GA, Oct 23, 2009 (MARKETWIRE via COMTEX News Network) -- United Community Banks, Inc. (NASDAQ: UCBI)

--  Capital significantly strengthened by $222.5 million public common
    offering
--  Provision for loan losses of $95.0 million exceeded charge-offs by
    $4.5 million
--  Allowance-to-loans ratio of 2.80 percent, up from 2.64 percent last
    quarter
--  Margin improvement of 11 basis points this quarter to 3.39 percent, up
    69 basis points year-to-date
--  Non-cash goodwill impairment charge of $25.0 million, or $.50 per
    diluted share


United Community Banks, Inc. (NASDAQ: UCBI) today reported a net operating loss of $43.7 million, or 93 cents per diluted share, for the third quarter of 2009. These results reflect elevated credit costs, including a $95 million provision for loan losses. Net operating loss does not include a $25 million non-cash charge for impairment of goodwill. Including this non-recurring charge, the net loss for the quarter was $68.7 million, or $1.43 per diluted share.

Net operating loss for the nine months ended September 30, 2009 was $98.8 million, or $2.17 per diluted share, and did not reflect $95 million of non-cash charges for goodwill impairment in the first and third quarters. Also not included were $2.9 million in severance costs in the first quarter and the $11.4 million gain on the Southern Community Bank acquisition in the second quarter, all of which are considered non-recurring items and therefore excluded from operating earnings. Including these non-recurring items, the net loss for the first nine months of 2009 was $188.5 million, or $4.01 per diluted share.

"We continue our strategy of aggressively disposing of problem credits," stated Jimmy Tallent, president and chief executive officer. "At the same time, we are sharply focused on offensive strategies to drive shareholder value long-term by increasing core earnings through margin expansion, expense reductions and core deposit growth. This has been accomplished each quarter throughout 2009."

Total loans were $5.4 billion at quarter-end, down $150 million from the second quarter and $467 million from the third quarter of 2008, reflecting continued reductions in exposure to the residential construction market and the overall weak business environment. As of September 30, 2009, residential construction loans were $1.2 billion, or 22 percent of total loans, a decrease of $411 million from a year ago and $130 million from the second quarter of 2009. "Partially offsetting the decline in total loans was our growth in Atlanta," stated Tallent. "I am very pleased with our progress in restructuring the Atlanta region, where we have closed $180 million in small business and commercial loans in the first nine months of 2009."

Taxable equivalent net interest revenue of $63.0 million reflected an increase of $2.1 million from last quarter, $4.2 million from a year ago, and an increase of $11.1 million from the fourth quarter of 2008. The taxable equivalent net interest margin was 3.39 percent compared with 3.28 percent for the second quarter of 2009, 3.17 percent for the third quarter of 2008, and 2.70 percent for the fourth quarter of 2008.

"The 11 basis point improvement in our net interest margin this quarter reflects our ongoing efforts to improve loan and deposit pricing," stated Tallent. "We continued to maintain our loan pricing strategy with higher credit spreads while lowering pricing on new and renewed time deposits. During the third quarter, over $400 million of time deposits matured that were part of a 15-month special program completed in the second quarter of 2008. We retained about half of these deposits with a rate reduction of over 225 basis points. We will continue to actively pursue lowering deposit rates to improve our margin while balancing liquidity needs with our goal of maximizing earnings."

"Excluding public funds and the deposits obtained through the acquisition, core transaction deposits increased $71 million this quarter and have grown $200 million year-to-date, or 13 percent on an annualized basis," Tallent said. "This growth reflects the success of our United Express program for customer referrals and cross-selling. Year-to-date we opened 9,776 net new deposit accounts. During the third quarter alone, we have added 17, 785 new services."

The third quarter provision for loan losses was $95.0 million compared with $60.0 million for the second quarter of 2009. Net charge-offs for the third quarter were $90.5 million compared with $58.3 million for the second quarter of 2009. At quarter-end, non-performing assets totaled $415.0 million compared with $392.6 million at June 30, 2009. The ratio of non-performing assets to total assets at the end of the third and second quarters was 4.91 percent and 4.63 percent, respectively. The allowance for loan losses to total loans was 2.80 percent and 2.64 percent, respectively.

"Credit quality continues to be our primary area of focus, particularly in the residential construction portfolio," Tallent said. "While we have seen a rise in all categories of non-performing assets, the inflow is still driven by continued weakness in the housing and construction markets. The good news is that the residential construction problem credits in the Atlanta region are starting to decline on a linked-quarter basis. We have seen some negative migration in the commercial real estate categories, but the amounts are still within reasonable levels in light of current economic conditions. Though we could see more negative migration in commercial loans, we are cautiously optimistic because the portfolio is diversified, cash flow sources are varied, and a large percentage of the loans are owner-occupied."

Operating fee revenue of $15.7 million reflected a $2.6 million increase from last quarter and a year ago. Operating fee revenue excludes the $11.4 million gain on the Southern Community Bank acquisition recorded last quarter. Consulting fees of $2.3 million were up $555,000 from last year due to an increase in demand for assistance with regulatory compliance matters. Mortgage loan fees of $1.8 million were up $422,000 from a year ago due to a high level of refinancing activity. Net securities gains of $1.1 million were up $1.0 million compared to the third quarter of 2008.

Operating expenses for the third quarter of 2009 were $53.6 million, a decrease of $3.4 million from last year. The decrease was primarily due to lower foreclosed property costs of $2.2 million and lower salary and benefit costs of $2.7 million. The decrease in salary and benefit costs were primarily due to the reduction in work force of 174 staff year-to-date and lower bonus incentives, which were offset partially by the 54 staff added last quarter through the acquisition. Additionally, several expense categories benefited this quarter from cost reductions including communications, advertising and printing costs. Partially offsetting the benefit of these lower costs were the rate increase for FDIC insurance premiums of $1.3 million and higher professional and legal fees related to the credit cycle.

The effective tax rate for the third quarter of 2009 was 28 percent, compared to 35 percent for the third quarter of 2008. The lower effective tax rate in the third quarter of 2009 was due to the goodwill impairment charge for which no tax benefit is recognized. Excluding the goodwill impairment charge, the effective tax rate for the third quarter of 2009 was 38 percent. The projected effective tax rate for the balance of 2009 is 38 percent.

At September 30, 2009, the company's regulatory capital ratios were as follows: Tier I Risk-Based Capital of 12.7 percent; Leverage of 9.5 percent; and Total Risk-Based of 15.3 percent. Also, the quarter-end tangible equity-to-assets ratio was 9.6 percent, the tangible common equity-to-assets ratio was 7.4 percent and the tangible common equity to risk weighted assets was 10.3 percent. The third quarter capital ratios reflect the successful common stock offering that closed on September 30, 2009. United issued 44,505,000 shares of common stock at a price of $5.00 per share and the net proceeds increased capital by $210.9 million.

"The additional capital significantly strengthens our balance sheet, allowing us to continue to aggressively deal with problem credits," stated Tallent. "Even more important, it positions us to take advantage of once-in-a-lifetime opportunities to grow our business through organic growth, FDIC assisted transactions and customer dislocation within our markets. All of our strategies support our goal of building long-term shareholder value. While there is a lot of work yet to be done, we have the strongest sense of urgency to return United to the higher levels of profitability that it has achieved for decades."

Conference Call

United Community Banks will hold a conference call today, Friday, October 23, 2009, 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 (888) 211-7262 and use the password 'UCBI.' 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. The Investor Presentation for Third Quarter 2009 can be accessed on the website by selecting 'Presentations' within the Investor Relations section.

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 $8.4 billion and operates 27 community banks with 109 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 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 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 "Forward-Looking Statements" on page 3 of United Community Banks, Inc.'s annual report filed on Form 10-K with the Securities and Exchange Commission.

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
                                                    2009
                                  ---------------------------------------
(in thousands, except per share      Third        Second         First
data; taxable equivalent)           Quarter       Quarter       Quarter
                                  -----------   -----------   -----------
INCOME SUMMARY
Interest revenue                  $   101,181   $   102,737   $   103,562
Interest expense                       38,177        41,855        46,150
                                  -----------   -----------   -----------
    Net interest revenue               63,004        60,882        57,412
Provision for loan losses              95,000        60,000        65,000
Operating fee revenue (1)              15,671        13,050        12,846
                                  -----------   -----------   -----------
   Total revenue                      (16,325)       13,932         5,258
Operating expenses (2)                 53,606        55,348        52,569
                                  -----------   -----------   -----------
    Operating loss before taxes       (69,931)      (41,416)      (47,311)
Income tax benefit                    (26,213)      (18,353)      (15,335)
                                  -----------   -----------   -----------
    Net operating loss (1)(2)         (43,718)      (23,063)      (31,976)
Gain from acquisitions, net of
 tax expense                                -         7,062             -
Noncash goodwill impairment
 charge                               (25,000)            -       (70,000)
Severance costs, net of tax
 benefit                                    -             -        (1,797)
                                  -----------   -----------   -----------
    Net loss                          (68,718)      (16,001)     (103,773)
Preferred dividends and discount
 accretion                              2,562         2,559         2,554
                                  -----------   -----------   -----------
Net loss available
 to common shareholders           $   (71,280)  $   (18,560)  $  (106,327)
                                  ===========   ===========   ===========
PERFORMANCE MEASURES
  Per common share:
    Diluted operating loss (1)(2) $      (.93)  $      (.53)  $      (.71)
    Diluted loss                        (1.43)         (.38)        (2.20)
    Cash dividends declared                 -             -             -
    Stock dividends declared (6)    1 for 130     1 for 130     1 for 130
    Book value                           8.85         13.87         14.70
    Tangible book value (4)              6.50          8.85          9.65
  Key performance ratios:
    Return on equity (3)(5)            (45.52)%      (11.42)%      (58.28)%
    Return on assets (5)                (3.32)         (.78)        (5.03)
    Net interest margin (5)              3.39          3.28          3.08
    Operating efficiency ratio
     (1)(2)(4)                          69.15         74.15         75.15
    Equity to assets                    10.27         10.71         11.56
    Tangible equity to assets (4)        7.55          7.96          8.24
    Tangible common equity to
     assets (4)                          5.36          5.77          6.09
    Tangible common equity to
     risk-weighted assets (4)           10.33          7.49          8.03
ASSET QUALITY *
  Non-performing loans (NPLs)     $   304,381   $   287,848   $   259,155
  Foreclosed properties               110,610       104,754        75,383
                                  -----------   -----------   -----------
    Total non-performing assets
     (NPAs)                           414,991       392,602       334,538
  Allowance for loan losses           150,187       145,678       143,990
  Net charge-offs                      90,491        58,312        43,281
  Allowance for loan losses to
   loans                                 2.80 %        2.64 %        2.56 %
  Net charge-offs to average
   loans (5)                             6.57          4.18          3.09
  NPAs to loans and foreclosed
   properties                            7.58          6.99          5.86
  NPAs to total assets                   4.91          4.63          4.09
AVERAGE BALANCES
  Loans                           $ 5,565,498   $ 5,597,259   $ 5,675,054
  Investment securities             1,615,499     1,771,482     1,712,654
  Earning assets                    7,400,539     7,442,178     7,530,230
  Total assets                      8,208,199     8,212,140     8,372,281
  Deposits                          6,689,948     6,544,537     6,780,531
  Shareholders' equity                843,130       879,210       967,505
  Common shares - basic                49,771        48,794        48,324
  Common shares - diluted              49,771        48,794        48,324
AT PERIOD END
  Loans                           $ 5,362,689   $ 5,513,087   $ 5,632,705
  Investment securities             1,532,514     1,816,787     1,719,033
  Total assets                      8,443,617     8,477,355     8,171,663
  Deposits                          6,821,306     6,848,760     6,616,488
  Shareholders' equity              1,006,638       855,272       888,853
  Common shares outstanding            93,901        48,933        48,487
(1)  Excludes the gain from acquisition of $11.4 million, net of income tax
expense of $4.3 million in the second quarter of 2009.  (2)  Excludes the
non-recurring goodwill impairment charges of $25 million and $70 million in
the third and first quarters of 2009, respectively, and severance costs of
$2.9 million, net of income tax benefit of $1.1 million in the first
quarter of 2009.  (3)  Net income available to common shareholders, which
excludes preferred stock dividends, divided by average realized common
equity, which excludes accumulated other comprehensive income (loss).
(4) Excludes effect of acquisition related intangibles and associated
amortization.  (5) Annualized.  (6) Number of new shares issued for
shares currently held.  NM - Not meaningful.
* Excludes loans and foreclosed properties covered by loss sharing
agreements with the FDIC.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
                                                2008               Third
                                     -------------------------    Quarter
(in thousands, except per share         Fourth        Third      2009-2008
data; taxable equivalent)              Quarter       Quarter       Change
                                     -----------   -----------   ---------
INCOME SUMMARY
Interest revenue                     $   108,434   $   112,510
Interest expense                          56,561        53,719
                                     -----------   -----------
    Net interest revenue                  51,873        58,791           7%
Provision for loan losses                 85,000        76,000
Operating fee revenue (1)                 10,718        13,121          19
                                     -----------   -----------
   Total revenue                         (22,409)       (4,088)        299
Operating expenses (2)                    52,439        56,970          (6)
                                     -----------   -----------
    Operating loss before taxes          (74,848)      (61,058)         15
Income tax benefit                       (28,101)      (21,184)
                                     -----------   -----------
    Net operating loss (1)(2)            (46,747)      (39,874)         10
Gain from acquisitions, net of tax
 expense                                       -             -
Noncash goodwill impairment charge             -             -
Severance costs, net of tax benefit            -             -
                                     -----------   -----------
    Net loss                             (46,747)      (39,874)         72
Preferred dividends and discount
 accretion                                   712             4
                                     -----------   -----------
Net loss available
 to common shareholders              $   (47,459)  $   (39,878)
                                     ===========   ===========
PERFORMANCE MEASURES
  Per common share:
    Diluted operating loss (1)(2)    $      (.99)  $      (.84)         11
    Diluted loss                            (.99)         (.84)         70
    Cash dividends declared                    -             -
    Stock dividends declared (6)       1 for 130     1 for 130
    Book value                             16.95         17.12         (48)
    Tangible book value (4)                10.39         10.48         (38)
  Key performance ratios:
    Return on equity (3)(5)               (23.83)%      (19.07)%
    Return on assets (5)                   (2.19)        (1.94)
    Net interest margin (5)                 2.70          3.17
    Operating efficiency
     ratio (1)(2)(4)                       81.34         79.35
    Equity to assets                       10.04         10.26
    Tangible equity to assets (4)           6.56          6.64
    Tangible common equity to assets (4)    6.21          6.64
    Tangible common equity to
     risk-weighted assets (4)               8.34          8.26
ASSET QUALITY *
  Non-performing loans (NPLs)        $   190,723   $   139,266
  Foreclosed properties                   59,768        38,438
                                     -----------   -----------
    Total non-performing assets
     (NPAs)                              250,491       177,704
  Allowance for loan losses              122,271       111,299
  Net charge-offs                         74,028        55,736
  Allowance for loan losses to loans        2.14%         1.91%
  Net charge-offs to average loans (5)      5.09          3.77
  NPAs to loans and foreclosed
   properties                               4.35          3.03
  NPAs to total assets                      2.92          2.19
AVERAGE BALANCES
  Loans                              $ 5,784,139   $ 5,889,168          (5)
  Investment securities                1,508,808     1,454,740          11
  Earning assets                       7,662,536     7,384,287           -
  Total assets                         8,487,017     8,164,694           1
  Deposits                             6,982,229     6,597,339           1
  Shareholders' equity                   851,956       837,487           1
  Common shares - basic                   47,844        47,417
  Common shares - diluted                 47,844        47,417
AT PERIOD END
  Loans                              $ 5,704,861   $ 5,829,937          (8)
  Investment securities                1,617,187     1,400,827           9
  Total assets                         8,591,933     8,113,961           4
  Deposits                             7,003,624     6,689,335           2
  Shareholders' equity                   989,382       816,880          23
  Common shares outstanding               48,009        47,596
(1)  Excludes the gain from acquisition of $11.4 million, net of income tax
expense of $4.3 million in the second quarter of 2009.  (2)  Excludes the
non-recurring goodwill impairment charges of $25 million and $70 million in
the third and first quarters of 2009, respectively, and severance costs of
$2.9 million, net of income tax benefit of $1.1 million in the first
quarter of 2009.  (3)  Net income available to common shareholders, which
excludes preferred stock dividends, divided by average realized common
equity, which excludes accumulated other comprehensive income (loss).
(4) Excludes effect of acquisition related intangibles and associated
amortization.  (5)  Annualized.  (6)  Number of new shares issued for
shares currently held.  NM - Not meaningful.
* Excludes loans and foreclosed properties covered by loss sharing
agreements with the FDIC.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
                                            For the Nine
                                            Months Ended            YTD
(in thousands, except per share      -------------------------   2009-2008
data; taxable equivalent)                2009          2008        Change
                                     -----------   -----------   --------
INCOME SUMMARY
Interest revenue                     $   307,480   $   358,535
Interest expense                         126,182       171,704
                                     -----------   -----------
    Net interest revenue                 181,298       186,831         (3)%
Provision for loan losses                220,000        99,000
Operating fee revenue (1)                 41,567        42,423         (2)
                                     -----------   -----------
   Total revenue                           2,865       130,254        (98)
Operating expenses (2)                   161,523       154,260          5
                                     -----------   -----------
    Operating loss before taxes         (158,658)      (24,006)       561
Income tax benefit                       (59,901)       (7,303)
                                     -----------   -----------
    Net operating loss (1)(2)            (98,757)      (16,703)       491
Gain from acquisitions, net of tax
 expense                                   7,062             -
Noncash goodwill impairment charge       (95,000)            -
Severance costs, net of tax benefit       (1,797)            -
                                     -----------   -----------
    Net loss                            (188,492)      (16,703)     1,028
Preferred dividends and discount
 accretion                                 7,675            12
                                     -----------   -----------
Net loss available
 to common shareholders              $  (196,167)  $   (16,715)
                                     ===========   ===========
PERFORMANCE MEASURES
  Per common share:
    Diluted operating loss (1)(2)    $     (2.17)  $      (.35)       520
    Diluted loss                           (4.01)         (.35)     1,046
    Cash dividends declared                    -           .18
    Stock dividends declared (6)       3 for 130     1 for 130
    Book value                              8.85         17.12        (48)
    Tangible book value (4)                 6.50         10.48        (38)
  Key performance ratios:
    Return on equity (3)(5)               (39.11)%       (2.69)%
    Return on assets (5)                   (3.05)         (.27)
    Net interest margin (5)                 3.25          3.35
    Operating efficiency
     ratio (1)(2)(4)                       72.72         67.43
    Equity to assets                       10.84         10.29
    Tangible equity to assets (4)           7.92          6.71
    Tangible common equity to assets (4)    5.74          6.70
    Tangible common equity to
     risk-weighted assets (4)              10.33          8.26
ASSET QUALITY *
  Non-performing loans (NPLs)        $   304,381   $   139,266
  Foreclosed properties                  110,610        38,438
                                     -----------   -----------
    Total non-performing assets
     (NPAs)                              414,991       177,704
  Allowance for loan losses              150,187       111,299
  Net charge-offs                        192,084        77,124
  Allowance for loan losses to loans        2.80%         1.91%
  Net charge-offs to average loans (5)      4.60          1.74
  NPAs to loans and foreclosed
   properties                               7.58          3.03
  NPAs to total assets                      4.91          2.19
AVERAGE BALANCES
  Loans                              $ 5,612,202   $ 5,926,731         (5)
  Investment securities                1,699,522     1,482,397         15
  Earning assets                       7,457,173     7,451,017          -
  Total assets                         8,263,605     8,262,853          -
  Deposits                             6,671,340     6,370,753          5
  Shareholders' equity                   896,159       849,912          5
  Common shares - basic                   48,968        47,210
  Common shares - diluted                 48,968        47,210
AT PERIOD END
  Loans                              $ 5,362,689   $ 5,829,937         (8)
  Investment securities                1,532,514     1,400,827          9
  Total assets                         8,443,617     8,113,961          4
  Deposits                             6,821,306     6,689,335          2
  Shareholders' equity                 1,006,638       816,880         23
  Common shares outstanding               93,901        47,596
(1)  Excludes the gain from acquisition of $11.4 million, net of income tax
expense of $4.3 million in the second quarter of 2009.  (2)  Excludes the
non-recurring goodwill impairment charges of $25 million and $70 million in
the third and first quarters of 2009, respectively, and severance costs of
$2.9 million, net of income tax benefit of $1.1 million in the first
quarter of 2009.  (3)  Net income available to common shareholders, which
excludes preferred stock dividends, divided by average realized common
equity, which excludes accumulated other comprehensive income (loss).
(4) Excludes effect of acquisition related intangibles and associated
amortization.  (5)  Annualized.  (6)  Number of new shares issued for
shares currently held.  NM - Not meaningful.
* 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
(in thousands,                    2009                        2008
 except per share   --------------------------------  --------------------
data; taxable         Third      Second      First      Fourth     Third
 equivalent)         Quarter    Quarter     Quarter     Quarter   Quarter
                    ---------  ---------  ----------  ---------  ---------
Interest revenue
 reconciliation
Interest revenue -
 taxable equivalent $ 101,181  $ 102,737  $  103,562  $ 108,434  $ 112,510
Taxable equivalent
 adjustment              (580)      (463)       (488)      (553)      (571)
                    ---------  ---------  ----------  ---------  ---------
    Interest
     revenue (GAAP) $ 100,601  $ 102,274  $  103,074  $ 107,881  $ 111,939
                    =========  =========  ==========  =========  =========
Net interest revenue
 reconciliation
Net interest
 revenue - taxable
 equivalent         $  63,004  $  60,882  $   57,412  $  51,873  $  58,791
Taxable equivalent
 adjustment              (580)      (463)       (488)      (553)      (571)
                    ---------  ---------  ----------  ---------  ---------
    Net interest
     revenue (GAAP) $  62,424  $  60,419  $   56,924  $  51,320  $  58,220
                    =========  =========  ==========  =========  =========
Fee revenue
 reconciliation
Operating fee
 revenue            $  15,671  $  13,050  $   12,846  $  10,718  $  13,121
Gain from
 acquisition                -     11,390           -          -          -
                    ---------  ---------  ----------  ---------  ---------
    Fee revenue
     (GAAP)         $  15,671  $  24,440  $   12,846  $  10,718  $  13,121
                    =========  =========  ==========  =========  =========
Total revenue
 reconciliation
Total operating
 revenue            $ (16,325) $  13,932  $    5,258  $ (22,409) $  (4,088)
Taxable equivalent
 adjustment              (580)      (463)       (488)      (553)      (571)
Gain from
 acquisition                -     11,390           -          -          -
                    ---------  ---------  ----------  ---------  ---------
    Total revenue
     (GAAP)         $ (16,905) $  24,859  $    4,770  $ (22,962) $  (4,659)
                    =========  =========  ==========  =========  =========
Expense
 reconciliation
Operating expense   $  53,606  $  55,348  $   52,569  $  52,439  $  56,970
Noncash goodwill
 impairment charge     25,000          -      70,000          -          -
Severance costs             -          -       2,898          -          -
                    ---------  ---------  ----------  ---------  ---------
    Operating
     expense (GAAP) $  78,606  $  55,348  $  125,467  $  52,439  $  56,970
                    =========  =========  ==========  =========  =========
(Loss) income before
 taxes reconciliation
Operating (loss)
 income before
 taxes              $ (69,931) $ (41,416) $  (47,311) $ (74,848) $ (61,058)
Taxable equivalent
 adjustment              (580)      (463)       (488)      (553)      (571)
Gain from
 acquisition                -     11,390           -          -          -
Noncash goodwill
 impairment charge    (25,000)         -     (70,000)         -          -
Severance costs             -          -      (2,898)         -          -
                    ---------  ---------  ----------  ---------  ---------
    (Loss) income
     before taxes
     (GAAP)         $ (95,511) $ (30,489) $ (120,697) $ (75,401) $ (61,629)
                    =========  =========  ==========  =========  =========
Income tax (benefit)
 expense reconciliation
Operating income
 tax (benefit)
 expense            $ (26,213) $ (18,353) $  (15,335) $ (28,101) $ (21,184)
Taxable equivalent
 adjustment              (580)      (463)       (488)      (553)      (571)
Gain from
 acquisition, tax
 expense                    -      4,328           -          -          -
Severance costs,
 tax benefit                -          -      (1,101)         -          -
                    ---------  ---------  ----------  ---------  ---------
    Income tax
     (benefit)
     expense (GAAP) $ (26,793) $ (14,488) $  (16,924) $ (28,654) $ (21,755)
                    =========  =========  ==========  =========  =========
(Loss) earnings per
 common share
 reconciliation
Operating (loss)
 earnings per
 common share       $   (0.93) $   (0.53) $    (0.71) $   (0.99) $   (0.84)
Gain from
 acquisition                -       0.15           -          -          -
Noncash goodwill
 impairment charge      (0.50)         -       (1.45)         -          -
Severance costs             -          -       (0.04)         -          -
                    ---------  ---------  ----------  ---------  ---------
    (Loss) earnings
     per common
     share (GAAP)   $   (1.43) $   (0.38) $    (2.20) $   (0.99) $   (0.84)
                    =========  =========  ==========  =========  =========
Book value
 reconciliation
Tangible book value $    6.50  $    8.85  $     9.65  $   10.39  $   10.48
Effect of goodwill
 and other
 intangibles             2.35       5.02        5.05       6.56       6.64
                    ---------  ---------  ----------  ---------  ---------
   Book value
    (GAAP)          $    8.85  $   13.87  $    14.70  $   16.95  $   17.12
                    =========  =========  ==========  =========  =========
Efficiency ratio
 reconciliation
Operating
 efficiency ratio       69.15%     74.15%      75.15%     81.34%     79.35%
Gain from
 acquisition                -      (9.82)          -          -          -
Noncash goodwill
 impairment charge      32.24          -      100.06          -          -
Severance costs             -          -        4.14          -          -
                    ---------  ---------  ----------  ---------  ---------
    Efficiency
     ratio (GAAP)      101.39%     64.33%     179.35%     81.34%     79.35%
                    =========  =========  ==========  =========  =========
Average equity to
 assets
 reconciliation
Tangible common
 equity to assets        5.36%      5.77%       6.09%      6.21%      6.64%
Effect of preferred
 equity                  2.19       2.19        2.15        .35          -
                    ---------  ---------  ----------  ---------  ---------
    Tangible equity
     to assets           7.55       7.96        8.24       6.56       6.64
Effect of goodwill
 and other
 intangibles             2.72       2.75        3.32       3.48       3.62
                    ---------  ---------  ----------  ---------  ---------
    Equity to
     assets (GAAP)      10.27%     10.71%      11.56%     10.04%     10.26%
                    =========  =========  ==========  =========  =========
Actual tangible
 common equity to
 risk-weighted
 assets reconciliation
Tangible common
 equity to
 risk-weighted
 assets                 10.33%      7.49%       8.03%      8.34%      8.26%
Effect of other
 comprehensive
 income                  (.87)      (.72)      (1.00)      (.91)      (.28)
Effect of deferred
 tax limitation          (.56)      (.22)          -          -          -
Effect of trust
 preferred                .89        .90         .89        .88        .68
Effect of preferred
 equity                  2.94       2.99        2.96       2.90          -
                    ---------  ---------  ----------  ---------  ---------
    Tier I capital
     ratio
     (Regulatory)       12.73%     10.44%      10.88%     11.21%      8.66%
                    =========  =========  ==========  =========  =========
UNITED COMMUNITY BANKS, INC.
Operating Earnings to GAAP Earnings Reconciliation
Selected Financial Information
                                                        For the Nine
(in thousands, except per share                         Months Ended
data; taxable equivalent)                         ------------------------
                                                      2009         2008
                                                  -----------  -----------
Interest revenue reconciliation
Interest revenue - taxable equivalent             $   307,480  $   358,535
Taxable equivalent adjustment                          (1,531)      (1,708)
                                                  -----------  -----------
    Interest revenue (GAAP)                       $   305,949  $   356,827
                                                  ===========  ===========
Net interest revenue reconciliation
Net interest revenue - taxable equivalent         $   181,298  $   186,831
Taxable equivalent adjustment                          (1,531)      (1,708)
                                                  -----------  -----------
    Net interest revenue (GAAP)                   $   179,767  $   185,123
                                                  ===========  ===========
Fee revenue reconciliation
Operating fee revenue                             $    41,567  $    42,423
Gain from acquisition                                  11,390            -
                                                  -----------  -----------
    Fee revenue (GAAP)                            $    52,957  $    42,423
                                                  ===========  ===========
Total revenue reconciliation
Total operating revenue                           $     2,865  $   130,254
Taxable equivalent adjustment                          (1,531)      (1,708)
Gain from acquisition                                  11,390            -
                                                  -----------  -----------
    Total revenue (GAAP)                          $    12,724  $   128,546
                                                  ===========  ===========
Expense reconciliation
Operating expense                                 $   161,523  $   154,260
Noncash goodwill impairment charge                     95,000            -
Severance costs                                         2,898            -
                                                  -----------  -----------
    Operating expense (GAAP)                      $   259,421  $   154,260
                                                  ===========  ===========
(Loss) income before taxes reconciliation
Operating (loss) income before taxes              $  (158,658) $   (24,006)
Taxable equivalent adjustment                          (1,531)      (1,708)
Gain from acquisition                                  11,390            -
Noncash goodwill impairment charge                    (95,000)           -
Severance costs                                        (2,898)           -
                                                  -----------  -----------
    (Loss) income before taxes (GAAP)             $  (246,697) $   (25,714)
                                                  ===========  ===========
Income tax (benefit) expense reconciliation
Operating income tax (benefit) expense            $   (59,901) $    (7,303)
Taxable equivalent adjustment                          (1,531)      (1,708)
Gain from acquisition, tax expense                      4,328            -
Severance costs, tax benefit                           (1,101)           -
                                                  -----------  -----------
    Income tax (benefit) expense (GAAP)           $   (58,205) $    (9,011)
                                                  ===========  ===========
(Loss) earnings per common share reconciliation
Operating (loss) earnings per common share        $     (2.17) $     (0.35)
Gain from acquisition                                    0.15            -
Noncash goodwill impairment charge                      (1.95)           -
Severance costs                                         (0.04)           -
                                                  -----------  -----------
    (Loss) earnings per common share (GAAP)       $     (4.01) $     (0.35)
                                                  ===========  ===========
Book value reconciliation
Tangible book value                               $      6.50  $     10.48
Effect of goodwill and other intangibles                 2.35         6.64
                                                  -----------  -----------
    Book value (GAAP)                             $      8.85  $     17.12
                                                  ===========  ===========
Efficiency ratio reconciliation
Operating efficiency ratio                              72.72%       67.43%
Gain from acquisition                                   (3.55)           -
Noncash goodwill impairment charge                      40.68            -
Severance costs                                          1.24            -
                                                  -----------  -----------
    Efficiency ratio (GAAP)                            111.09%       67.43%
                                                  ===========  ===========
Average equity to assets reconciliation
Tangible common equity to assets                         5.74%        6.70%
Effect of preferred equity                               2.18          .01
                                                  -----------  -----------
    Tangible equity to assets                            7.92         6.71
Effect of goodwill and other intangibles                 2.92         3.58
                                                  -----------  -----------
    Equity to assets (GAAP)                             10.84%       10.29%
                                                  ===========  ===========
Actual tangible common equity to risk-weighted
 assets reconciliation
Tangible common equity to risk-weighted assets          10.33%        8.26%
Effect of other comprehensive income                     (.87)        (.28)
Effect of deferred tax limitation                        (.56)           -
Effect of trust preferred                                 .89          .68
Effect of preferred equity                               2.94            -
                                                  -----------  -----------
    Tier I capital ratio (Regulatory)                   12.73%        8.66%
                                                  ===========  ===========
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End
                                                         2009
                                           --------------------------------
                                             Third      Second     First
(in millions)                              Quarter(1) Quarter(1)  Quarter
                                           ---------- ---------- ----------
LOANS BY CATEGORY
Commercial (sec. by RE)                    $    1,787 $    1,797 $    1,779
Commercial construction                           380        379        377
Commercial & industrial                           403        399        387
                                           ---------- ---------- ----------
     Total commercial                           2,570      2,575      2,543
Residential construction                        1,185      1,315      1,430
Residential mortgage                            1,461      1,470      1,504
Consumer / installment                            147        153        156
                                           ---------- ---------- ----------
     Total loans                           $    5,363 $    5,513 $    5,633
                                           ========== ========== ==========
LOANS BY MARKET
Atlanta MSA                                $    1,526 $    1,605 $    1,660
Gainesville MSA                                   402        413        422
North Georgia                                   1,942      1,978      2,014
Western North Carolina                            786        794        808
Coastal Georgia                                   440        455        460
East Tennessee                                    267        268        269
                                           ---------- ---------- ----------
     Total loans                           $    5,363 $    5,513 $    5,633
                                           ========== ========== ==========
RESIDENTIAL CONSTRUCTION
Dirt loans
   Acquisition & development               $      380 $      413 $      445
   Land loans                                     159        159        155
   Lot loans                                      336        369        390
                                           ---------- ---------- ----------
      Total                                       875        941        990
                                           ---------- ---------- ----------
House loans
   Spec                                           218        268        317
   Sold                                            92        106        123
                                           ---------- ---------- ----------
      Total                                       310        374        440
                                           ---------- ---------- ----------
Total residential construction             $    1,185 $    1,315 $    1,430
                                           ========== ========== ==========
RESIDENTIAL CONSTRUCTION - ATLANTA MSA
Dirt loans
   Acquisition & development               $      100 $      124 $      148
   Land loans                                      61         63         52
   Lot loans                                       54         81         98
                                           ---------- ---------- ----------
      Total                                       215        268        298
                                           ---------- ---------- ----------
House loans
   Spec                                            91        127        164
   Sold                                            22         29         33
                                           ---------- ---------- ----------
      Total                                       113        156        197
                                           ---------- ---------- ----------
Total residential construction             $      328 $      424 $      495
                                           ========== ========== ==========
(1)  Excludes total loans of $104.0 million and $109.9 million as of
September 30, 2009 and June 30, 2009, respectively, that are covered by the
loss-sharing agreement with the FDIC, related to the acquisition of
Southern Community Bank.
(2)  Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End
                                                      Linked     Year over
                                                      Quarter      Year
                                        2008          Change(2)   Change
                                --------------------- --------   --------
                                 Fourth      Third
(in millions)                    Quarter    Quarter     Actual     Actual
                                ---------- ---------- --------   --------
LOANS BY CATEGORY
Commercial (sec. by RE)         $    1,627 $    1,604       (2)%       11%
Commercial construction                500        509        1        (25)
Commercial & industrial                410        425        4         (5)
                                ---------- ----------
     Total commercial                2,537      2,538       (1)         1
Residential construction             1,479      1,596      (40)       (26)
Residential mortgage                 1,526      1,528       (2)        (4)
Consumer / installment                 163        168      (16)       (13)
                                ---------- ----------
     Total loans                $    5,705 $    5,830      (11)        (8)
                                ========== ==========
LOANS BY MARKET
Atlanta MSA                     $    1,706 $    1,800      (20)%      (15)%
Gainesville MSA                        420        426      (11)        (6)
North Georgia                        2,040      2,066       (7)        (6)
Western North Carolina                 810        815       (4)        (4)
Coastal Georgia                        464        458      (13)        (4)
East Tennessee                         265        265       (1)         1
                                ---------- ----------
     Total loans                $    5,705 $    5,830      (11)        (8)
                                ========== ==========
RESIDENTIAL CONSTRUCTION
Dirt loans
   Acquisition & development    $      484 $      516      (32)%      (26)%
   Land loans                          153        142        -         12
   Lot loans                           358        385      (36)       (13)
                                ---------- ----------
      Total                            995      1,043      (28)       (16)
                                ---------- ----------
House loans
   Spec                                347        393      (75)%      (45)%
   Sold                                137        160      (53)       (43)
                                ---------- ----------
      Total                            484        553      (68)       (44)
                                ---------- ----------
Total residential construction  $    1,479 $    1,596      (40)       (26)
                                ========== ==========
RESIDENTIAL CONSTRUCTION -
 ATLANTA MSA
Dirt loans
   Acquisition & development    $      167 $      185      (77)%      (46)%
   Land loans                           56         47      (13)        30
   Lot loans                            86        103     (133)       (48)
                                ---------- ----------
      Total                            309        335      (79)       (36)
                                ---------- ----------
House loans
   Spec                                189        227     (113)%      (60)%
   Sold                                 40         49      (97)       (55)
                                ---------- ----------
      Total                            229        276     (110)       (59)
                                ---------- ----------
Total residential construction  $      538 $      611      (91)       (46)
                                ========== ==========
(1)  Excludes total loans of $104.0 million and $109.9 million as of
September 30, 2009 and June 30, 2009, respectively, that are covered by the
loss-sharing agreement with the FDIC, related to the acquisition of
Southern Community Bank.
(2)  Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)
                                             Third Quarter 2009
                                   ----------------------------------------
                                   Non-performing  Foreclosed      Total
(in thousands)                         Loans       Properties      NPAs
                                   -------------- ------------ ------------
NPAs BY CATEGORY
Commercial (sec. by RE)            $       38,379 $     12,566 $     50,945
Commercial construction                    38,505        5,543       44,048
Commercial & industrial                     3,794            -        3,794
                                   -------------- ------------ ------------
     Total commercial                      80,678       18,109       98,787
Residential construction                  171,027       79,045      250,072
Residential mortgage                       50,626       13,456       64,082
Consumer / installment                      2,050            -        2,050
                                   -------------- ------------ ------------
     Total NPAs                    $      304,381 $    110,610 $    414,991
                                   ============== ============ ============
NPAs BY MARKET
Atlanta MSA                        $      120,599 $     54,670 $    175,269
Gainesville MSA                            12,916        8,429       21,345
North Georgia                              96,373       36,718      133,091
Western North Carolina                     25,775        5,918       31,693
Coastal Georgia                            38,414        3,045       41,459
East Tennessee                             10,304        1,830       12,134
                                   -------------- ------------ ------------
     Total NPAs                    $      304,381 $    110,610 $    414,991
                                   ============== ============ ============
(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)  Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)
                                             Second Quarter 2009
                                   ----------------------------------------
                                   Non-performing  Foreclosed      Total
(in thousands)                         Loans       Properties      NPAs
                                   -------------- ------------ ------------
NPAs BY CATEGORY
Commercial (sec. by RE)            $       37,755 $      5,395 $     43,150
Commercial construction                    15,717        5,847       21,564
Commercial & industrial                    11,378            -       11,378
                                   -------------- ------------ ------------
     Total commercial                      64,850       11,242       76,092
Residential construction                  176,400       81,648      258,048
Residential mortgage                       44,256       11,864       56,120
Consumer / installment                      2,342            -        2,342
                                   -------------- ------------ ------------
     Total NPAs                    $      287,848 $    104,754 $    392,602
                                   ============== ============ ============
NPAs BY MARKET
Atlanta MSA                        $      148,155 $     50,450 $    198,605
Gainesville MSA                             9,745        3,511       13,256
North Georgia                              72,174       37,454      109,628
Western North Carolina                     21,814        7,245       29,059
Coastal Georgia                            30,311        3,904       34,215
East Tennessee                              5,649        2,190        7,839
                                   -------------- ------------ ------------
     Total NPAs                    $      287,848 $    104,754 $    392,602
                                   ============== ============ ============
(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)  Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)
                                             First Quarter 2009
                                   ----------------------------------------
                                   Non-performing  Foreclosed      Total
(in thousands)                         Loans       Properties      NPAs
                                   -------------- ------------ ------------
NPAs BY CATEGORY
Commercial (sec. by RE)            $       18,188 $      3,811 $     21,999
Commercial construction                     6,449        2,948        9,397
Commercial & industrial                    12,066            -       12,066
                                   -------------- ------------ ------------
     Total commercial                      36,703        6,759       43,462
Residential construction                  187,656       58,327      245,983
Residential mortgage                       33,148       10,297       43,445
Consumer / installment                      1,648            -        1,648
                                   -------------- ------------ ------------
     Total NPAs                    $      259,155 $     75,383 $    334,538
                                   ============== ============ ============
NPAs BY MARKET
Atlanta MSA                        $      131,020 $     48,574 $    179,594
Gainesville MSA                            17,448          694       18,142
North Georgia                              66,875       20,811       87,686
Western North Carolina                     21,240        3,067       24,307
Coastal Georgia                            15,699        1,286       16,985
East Tennessee                              6,873          951        7,824
                                   -------------- ------------ ------------
     Total NPAs                    $      259,155 $     75,383 $    334,538
                                   ============== ============ ============
(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)  Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)
                Third Quarter 2009  Second Quarter 2009 First Quarter 2009
                ------------------  ------------------- ------------------
                            Net                 Net                Net
                          Charge-             Charge-             Charge-
                  Net     Offs to     Net     Offs to     Net     Offs to
                Charge-   Average   Charge-   Average   Charge-   Average
(in thousands)   Offs     Loans(2)   Offs     Loans(2)   Offs     Loans(2)
                --------  --------  --------  --------  --------  --------
NET CHARGE-OFFS
 BY CATEGORY
Commercial
 (sec. by RE)   $ 10,568      2.33% $  5,986      1.34% $    826       .20%
Commercial
 construction      4,369      4.55       756       .80        54       .05
Commercial &
 industrial        1,792      1.76     3,107      3.16       873       .89
                --------            --------            --------
     Total
      commercial  16,729      2.57     9,849      1.54     1,753       .28
Residential
 construction     67,520     21.31    44,240     12.90    37,762     10.52
Residential
 mortgage          5,051      1.36     3,526       .95     2,984       .80
Consumer /
 installment       1,191      3.13       697      1.80       782      1.99
                --------            --------            --------
     Total      $ 90,491      6.57  $ 58,312      4.18  $ 43,281      3.09
                ========            ========            ========
NET CHARGE-OFFS
 BY MARKET
Atlanta MSA     $ 50,129     12.61% $ 37,473      8.89% $ 26,228      6.16%
Gainesville MSA    1,473      1.60     4,125      4.38     1,105      1.18
North Georgia     24,017      4.74    12,571      2.52     8,208      1.64
Western North
 Carolina          3,949      1.98     1,015       .51     3,669      1.83
Coastal Georgia   10,051      8.78       969       .85     3,229      2.84
East Tennessee       872      1.30     2,159      3.21       842      1.28
                --------            --------            --------
     Total      $ 90,491      6.57  $ 58,312      4.18  $ 43,281      3.09
                ========            ========            ========
                  Third              Second               First
(in thousands)   Quarter             Quarter             Quarter
                  2009                2009                2009
                --------            --------            --------
FORECLOSED
 PROPERTIES
Beginning
 balance        $104,754            $ 75,383            $ 59,768
Foreclosures
 transferred in   56,624              64,417              38,742
Capital costs
 added               579               1,324               1,452
Write downs       (1,906)             (2,738)             (2,151)
Proceeds from
 sales           (49,441)            (33,632)            (22,428)
                --------            --------            --------
     Total      $110,610            $104,754            $ 75,383
                ========            ========            ========
(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)  Annualized.
UNITED COMMUNITY BANKS, INC.
Consolidated Statement of Income (Unaudited)
                                                       Three Months Ended
                                                          September 30,
                                                      --------------------
(in thousands, except per share data)                   2009       2008
                                                      ---------  ---------
Interest revenue:
  Loans, including fees                               $  80,874  $  93,233
  Investment securities, including tax exempt of
   $328, $348, $956 and $1,140                           18,820     18,606
  Federal funds sold, commercial paper, deposits in
   banks and other                                          907        100
                                                      ---------  ---------
       Total interest revenue                           100,601    111,939
                                                      ---------  ---------
Interest expense:
  Deposits:
    NOW                                                   2,528      6,778
    Money market                                          2,711      2,296
    Savings                                                 130        153
    Time                                                 28,183     39,044
                                                      ---------  ---------
       Total deposit interest expense                    33,552     48,271
  Federal funds purchased, repurchase agreements
   and other short-term borrowings                          613      1,116
  Federal Home Loan Bank advances                         1,300      2,105
  Long-term debt                                          2,712      2,227
                                                      ---------  ---------
    Total interest expense                               38,177     53,719
                                                      ---------  ---------
    Net interest revenue                                 62,424     58,220
  Provision for loan losses                              95,000     76,000
                                                      ---------  ---------
    Net interest revenue after provision for loan
     losses                                             (32,576)   (17,780)
                                                      ---------  ---------
Fee revenue:
  Service charges and fees                                8,138      8,171
  Mortgage loan and other related fees                    1,832      1,410
  Consulting fees                                         2,282      1,727
  Brokerage fees                                            456        905
  Securities gains, net                                   1,149        120
  Gain from acquisition                                       -          -
  Other                                                   1,814        788
                                                      ---------  ---------
    Total fee revenue                                    15,671     13,121
                                                      ---------  ---------
    Total revenue                                       (16,905)    (4,659)
                                                      ---------  ---------
Operating expenses:
  Salaries and employee benefits                         25,881     28,626
  Communications and equipment                            3,732      3,909
  Occupancy                                               4,098      3,905
  Advertising and public relations                          887      1,399
  Postage, printing and supplies                          1,277      1,493
  Professional fees                                       2,255      1,596
  Foreclosed property                                     7,918     10,109
  FDIC assessments and other regulatory charges           2,801      1,509
  Amortization of intangibles                               813        752
  Other                                                   3,944      3,672
  Goodwill impairment                                    25,000          -
  Severance costs                                             -          -
                                                      ---------  ---------
    Total operating expenses                             78,606     56,970
                                                      ---------  ---------
  Loss before income taxes                              (95,511)   (61,629)
  Income tax benefit                                    (26,793)   (21,755)
                                                      ---------  ---------
    Net loss                                            (68,718)   (39,874)
  Preferred stock dividends, including discount
   accretion                                              2,562          4
                                                      ---------  ---------
    Net loss available to common shareholders         $ (71,280) $ (39,878)
                                                      =========  =========
Basic loss per common share                           $   (1.43) $    (.84)
Diluted loss per common share                             (1.43)      (.84)
Weighted average common shares outstanding - Basic       49,771     47,417
Weighted average common shares outstanding - Diluted     49,771     47,417
UNITED COMMUNITY BANKS, INC.
Consolidated Statement of Income (Unaudited)
                                                      Nine Months Ended
                                                        September 30,
                                                    ----------------------
(in thousands, except per share data)                  2009        2008
                                                    ----------  ----------
Interest revenue:
  Loans, including fees                             $  244,445  $  299,550
  Investment securities, including tax exempt of
   $328, $348, $956 and $1,140                          60,057      56,905
  Federal funds sold, commercial paper, deposits in
   banks and other                                       1,447         372
                                                    ----------  ----------
    Total interest revenue                             305,949     356,827
                                                    ----------  ----------
Interest expense:
  Deposits:
    NOW                                                  8,708      22,581
    Money market                                         7,217       7,519
    Savings                                                378         560
    Time                                                96,300     116,756
                                                    ----------  ----------
       Total deposit interest expense                  112,603     147,416
  Federal funds purchased, repurchase agreements
   and other short-term borrowings                       1,761       7,254
  Federal Home Loan Bank advances                        3,577      10,668
  Long-term debt                                         8,241       6,366
                                                    ----------  ----------
    Total interest expense                             126,182     171,704
                                                    ----------  ----------
    Net interest revenue                               179,767     185,123
  Provision for loan losses                            220,000      99,000
                                                    ----------  ----------
    Net interest revenue after provision for loan
     losses                                            (40,233)     86,123
                                                    ----------  ----------
Fee revenue:
  Service charges and fees                              22,729      23,941
  Mortgage loan and other related fees                   7,308       5,575
  Consulting fees                                        5,048       5,786
  Brokerage fees                                         1,642       2,812
  Securities gains, net                                    741         477
  Gain from acquisition                                 11,390           -
  Other                                                  4,099       3,832
                                                    ----------  ----------
    Total fee revenue                                   52,957      42,423
                                                    ----------  ----------
    Total revenue                                       12,724     128,546
                                                    ----------  ----------
Operating expenses:
  Salaries and employee benefits                        82,778      86,133
  Communications and equipment                          11,106      11,593
  Occupancy                                             11,758      11,325
  Advertising and public relations                       3,187       4,759
  Postage, printing and supplies                         3,753       4,533
  Professional fees                                      7,354       5,196
  Foreclosed property                                   17,974      13,872
  FDIC assessments and other regulatory charges         12,293       4,040
  Amortization of intangibles                            2,291       2,264
  Other                                                  9,029      10,545
  Goodwill impairment                                   95,000           -
  Severance costs                                        2,898           -
                                                    ----------  ----------
    Total operating expenses                           259,421     154,260
                                                    ----------  ----------
  Loss before income taxes                            (246,697)    (25,714)
  Income tax benefit                                   (58,205)     (9,011)
                                                    ----------  ----------
    Net loss                                          (188,492)    (16,703)
  Preferred stock dividends, including discount
   accretion                                             7,675          12
                                                    ----------  ----------
    Net loss available to common shareholders       $ (196,167) $  (16,715)
                                                    ==========  ==========
Basic loss per common share                         $    (4.01) $     (.35)
Diluted loss per common share                            (4.01)       (.35)
Weighted average common shares outstanding - Basic      48,968      47,210
Weighted average common shares outstanding - Diluted    48,968      47,210
UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheet
(in thousands, except share    September 30,  December 31,   September 30,
  and per share data)              2009           2008           2008
                               -------------  -------------  -------------
                                (unaudited)     (audited)     (unaudited)
ASSETS
   Cash and due from banks     $     195,559  $     116,395  $     126,033
   Interest-bearing deposits
    in banks                          78,589          8,417         40,707
   Federal funds sold,
    commercial paper and
    short-term investments           397,361        368,609              -
                               -------------  -------------  -------------
      Cash and cash
       equivalents                   671,509        493,421        166,740
   Securities available for sale   1,532,514      1,617,187      1,400,827
   Mortgage loans held for sale       20,460         20,334         17,763
   Loans, net of unearned income   5,362,689      5,704,861      5,829,937
        Less allowance for
         loan losses                 150,187        122,271        111,299
                               -------------  -------------  -------------
             Loans, net            5,212,502      5,582,590      5,718,638
   Covered assets                    197,914              -              -
   Premises and equipment, net       179,467        179,160        179,727
   Accrued interest receivable        35,679         46,088         47,920
   Goodwill and other
    intangible assets                226,008        321,798        322,544
   Other assets                      367,564        331,355        259,802
                               -------------  -------------  -------------
      Total assets             $   8,443,617  $   8,591,933  $   8,113,961
                               =============  =============  =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
   Deposits:
     Demand                    $     703,054  $     654,036  $     680,196
     NOW                           1,318,264      1,543,385      1,393,928
     Money market                    687,780        466,750        394,358
     Savings                         180,738        170,275        179,274
     Time:
        Less than $100,000         1,854,726      1,953,235      1,814,926
        Greater than $100,000      1,237,172      1,422,974      1,481,512
        Brokered                     839,572        792,969        745,141
                               -------------  -------------  -------------
             Total deposits        6,821,306      7,003,624      6,689,335
    Federal funds purchased,
     repurchase agreements,
     and other short-term
     borrowings                      101,951        108,411        119,699
    Federal Home Loan Bank
     advances                        314,704        235,321        285,362
    Long-term debt                   150,046        150,986        137,996
    Accrued expenses and other
     liabilities                      48,972        104,209         64,689
                               -------------  -------------  -------------
         Total liabilities         7,436,979      7,602,551      7,297,081
                               -------------  -------------  -------------
 Shareholders' equity:
   Preferred stock, $1 par value;
    10,000,000 shares authorized;
      Series A; $10 stated value;
       21,700, 25,800 and 25,800
       shares issued and
       outstanding                       217            258            258
      Series B; $1,000 stated value;
       180,000 shares issued and
       outstanding                   174,095        173,180              -
   Common stock, $1 par value;
    100,000,000 shares authorized;
    93,901,492, 48,809,301
    and 48,809,301 shares issued      93,901         48,809         48,809
   Common stock issuable; 196,818,
    129,304 and 116,567 shares         3,471          2,908          2,762
   Capital surplus                   620,494        460,708        457,779
   Retained earnings                  62,786        265,405        317,544
   Treasury stock; 799,892 and
    1,213,182 shares, at cost              -        (16,465)       (27,024)
   Accumulated other
    comprehensive income              51,674         54,579         16,752
                               -------------  -------------  -------------
      Total shareholders' equity   1,006,638        989,382        816,880
      Total liabilities and
       shareholders' equity    $   8,443,617  $   8,591,933  $   8,113,961
                               =============  =============  =============
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended September 30,
                                                          2009
                                         ---------------------------------
(dollars in thousands, taxable             Average                   Avg.
 equivalent)                               Balance      Interest     Rate
                                         -----------  ------------ -------
Assets:
Interest-earning assets:
  Loans, net of unearned income (1)(2)   $ 5,565,498  $     80,880    5.77%
  Taxable securities (3)                   1,585,154        18,492    4.67
  Tax-exempt securities (1)(3)                30,345           537    7.08
  Federal funds sold and other
   interest-earning assets                   219,542         1,272    2.32
                                         -----------  ------------
     Total interest-earning assets         7,400,539       101,181    5.43
                                         -----------  ------------
Non-interest-earning assets:
  Allowance for loan losses                 (147,074)
  Cash and due from banks                    107,062
  Premises and equipment                     179,764
  Other assets (3)                           667,908
                                         -----------
     Total assets                        $ 8,208,199
                                         ===========
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
  Interest-bearing deposits:
   NOW                                   $ 1,238,596  $      2,528     .81
   Money market                              628,392         2,711    1.71
   Savings                                   180,216           130     .29
   Time less than $100,000                 1,918,439        13,300    2.75
   Time greater than $100,000              1,292,786        10,106    3.10
   Brokered                                  707,678         4,777    2.68
                                         -----------  ------------
       Total interest-bearing deposits     5,966,107        33,552    2.23
                                         -----------  ------------
   Federal funds purchased and other
    borrowings                               234,211           613    1.04
   Federal Home Loan Bank advances           210,625         1,300    2.45
   Long-term debt                            150,353         2,712    7.16
                                         -----------  ------------
      Total borrowed funds                   595,189         4,625    3.08
                                         -----------  ------------
      Total interest-bearing liabilities   6,561,296        38,177    2.31
                                                      ------------
Non-interest-bearing liabilities:
  Non-interest-bearing deposits              723,841
  Other liabilities                           79,932
                                         -----------
     Total liabilities                     7,365,069
Shareholders' equity                         843,130
                                         -----------
     Total liabilities and shareholders'
      equity                             $ 8,208,199
                                         ===========
Net interest revenue                                  $     63,004
                                                      ============
Net interest-rate spread                                              3.12%
                                                                   =======
Net interest margin (4)                                               3.39%
                                                                   =======
(1)  Interest revenue on tax-exempt securities and loans has been increased
     to reflect comparable interest on taxable securities and loans.  The
     rate used was 39%, reflecting the statutory federal income tax rate
     and the federal tax adjusted state income tax rate.
(2)  Included in the average balance of loans outstanding are loans where
     the accrual of interest has been discontinued.
(3)  Securities available for sale are shown at amortized cost.  Pretax
     unrealized gains of $13.8 million in 2009 and pretax unrealized losses
     of $11.7 million in 2008 are included in other assets for purposes of
     this presentation.
(4)  Net interest margin is taxable equivalent net-interest revenue divided
     by average interest-earning assets.
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended September 30,
                                                          2008
                                         ---------------------------------
(dollars in thousands, taxable             Average                   Avg.
 equivalent)                               Balance      Interest     Rate
                                         -----------  ------------ -------
Assets:
Interest-earning assets:
  Loans, net of unearned income (1)(2)   $ 5,889,168  $     93,270    6.30%
  Taxable securities (3)                   1,422,321        18,258    5.13
  Tax-exempt securities (1)(3)                32,419           573    7.07
  Federal funds sold and other
   interest-earning assets                    40,379           409    4.05
                                         -----------  ------------
     Total interest-earning assets         7,384,287       112,510    6.07
                                         -----------  ------------
Non-interest-earning assets:
  Allowance for loan losses                  (93,687)
  Cash and due from banks                    111,741
  Premises and equipment                     180,825
  Other assets (3)                           581,528
                                         -----------
     Total assets                        $ 8,164,694
                                         ===========
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
  Interest-bearing deposits:
   NOW                                   $ 1,463,744  $      6,778    1.84
   Money market                              421,626         2,296    2.17
   Savings                                   182,525           153     .33
   Time less than $100,000                 1,779,550        17,812    3.98
   Time greater than $100,000              1,530,719        15,825    4.11
   Brokered                                  530,705         5,407    4.05
                                         -----------  ------------
       Total interest-bearing deposits     5,908,869        48,271    3.25
                                         -----------  ------------
   Federal funds purchased and other
    borrowings                               256,742         1,116    1.73
   Federal Home Loan Bank advances           286,540         2,105    2.92
   Long-term debt                            118,756         2,227    7.46
                                         -----------  ------------
      Total borrowed funds                   662,038         5,448    3.27
                                         -----------  ------------
      Total interest-bearing liabilities   6,570,907        53,719    3.25
                                                      ------------
Non-interest-bearing liabilities:
   Non-interest-bearing deposits             688,470
   Other liabilities                          67,830
                                         -----------
     Total liabilities                     7,327,207
Shareholders' equity                         837,487
                                         -----------
     Total liabilities and shareholders'
      equity                             $ 8,164,694
                                         ===========
Net interest revenue                                  $     58,791
                                                      ============
Net interest-rate spread                                              2.82%
                                                                   =======
Net interest margin (4)                                               3.17%
                                                                   =======
(1)  Interest revenue on tax-exempt securities and loans has been increased
     to reflect comparable interest on taxable securities and loans.  The
     rate used was 39%, reflecting the statutory federal income tax rate
     and the federal tax adjusted state income tax rate.
(2)  Included in the average balance of loans outstanding are loans where
     the accrual of interest has been discontinued.
(3)  Securities available for sale are shown at amortized cost.  Pretax
     unrealized gains of $13.8 million in 2009 and pretax unrealized losses
     of $11.7 million in 2008 are included in other assets for purposes of
     this presentation.
(4)  Net interest margin is taxable equivalent net-interest revenue divided
     by average interest-earning assets.
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Nine Months Ended September 30,
                                                          2009
                                         -----------  ------------ -------
(dollars in thousands, taxable             Average                   Avg.
 equivalent)                               Balance      Interest     Rate
                                         -----------  ------------ -------
Assets:
Interest-earning assets:
  Loans, net of unearned income (1)(2)   $ 5,612,202  $    244,196    5.82%
  Taxable securities (3)                   1,669,768        59,101    4.72
  Tax-exempt securities (1)(3)                29,754         1,565    7.01
  Federal funds sold and other
   interest-earning assets                   145,449         2,618    2.40
                                         -----------  ------------
     Total interest-earning assets         7,457,173       307,480    5.51
                                         -----------  ------------
Non-interest-earning assets:
  Allowance for loan losses                 (141,255)
  Cash and due from banks                    104,444
  Premises and equipment                     179,569
  Other assets (3)                           663,674
                                         -----------
     Total assets                        $ 8,263,605
                                         ===========
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
  Interest-bearing deposits:
    NOW                                  $ 1,284,522  $      8,708     .91
    Money market                             543,122         7,217    1.78
    Savings                                  177,147           378     .29
    Time less than $100,000                1,918,379        45,859    3.20
    Time greater than $100,000             1,336,876        34,444    3.44
    Brokered                                 726,352        15,997    2.94
                                         -----------  ------------
       Total interest-bearing deposits     5,986,398       112,603    2.51
                                         -----------  ------------
    Federal funds purchased and other
     borrowings                              202,008         1,761    1.17
    Federal Home Loan Bank advances          241,863         3,577    1.98
    Long-term debt                           150,788         8,241    7.31
                                         -----------  ------------
      Total borrowed funds                   594,659        13,579    3.05
                                         -----------  ------------
      Total interest-bearing liabilities   6,581,057       126,182    2.56
                                                      ------------
Non-interest-bearing liabilities:
    Non-interest-bearing deposits            684,942
    Other liabilities                        101,447
                                         -----------
      Total liabilities                    7,367,446
Shareholders' equity                         896,159
                                         -----------
      Total liabilities and shareholders'
       equity                            $ 8,263,605
                                         ===========
Net interest revenue                                  $    181,298
                                                      ============
Net interest-rate spread                                              2.95%
                                                                   =======
Net interest margin (4)                                               3.25%
                                                                   =======
(1)  Interest revenue on tax-exempt securities and loans has been increased
     to reflect comparable interest on taxable securities and loans.  The
     rate used was 39%, reflecting the statutory federal income tax rate
     and the federal tax adjusted state income tax rate.
(2)  Included in the average balance of loans outstanding are loans where
     the accrual of interest has been discontinued.
(3)  Securities available for sale are shown at amortized cost.  Pretax
     unrealized gains of $13.0 million in 2009 and $5.7 million in 2008 are
     included in other assets for purposes of this presentation.
(4)  Net interest margin is taxable equivalent net-interest revenue divided
     by average interest-earning assets.
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Nine Months Ended September 30,
                                                          2008
                                         -----------  ------------ -------
(dollars in thousands, taxable             Average                   Avg.
 equivalent)                               Balance      Interest     Rate
                                         -----------  ------------ -------
Assets:
Interest-earning assets:
  Loans, net of unearned income (1)(2)   $ 5,926,731  $    299,601    6.75%
  Taxable securities (3)                   1,447,409        55,765    5.14
  Tax-exempt securities (1)(3)                34,988         1,876    7.15
  Federal funds sold and other
   interest-earning assets                    41,889         1,292    4.11
                                         -----------  ------------
     Total interest-earning assets         7,451,017       358,534    6.43
                                         -----------  ------------
Non-interest-earning assets:
  Allowance for loan losses                  (93,165)
  Cash and due from banks                    136,920
  Premises and equipment                     181,210
  Other assets (3)                           586,871
                                         -----------
     Total assets                        $ 8,262,853
                                         ===========
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
  Interest-bearing deposits:
    NOW                                  $ 1,476,998  $     22,581    2.04
    Money market                             427,676         7,519    2.35
    Savings                                  184,713           560     .40
    Time less than $100,000                1,659,308        53,320    4.29
    Time greater than $100,000             1,460,277        48,330    4.42
    Brokered                                 480,166        15,106    4.20
                                         -----------  ------------
       Total interest-bearing deposits     5,689,138       147,416    3.46
                                         -----------  ------------
    Federal funds purchased and other
     borrowings                              396,798         7,254    2.44
    Federal Home Loan Bank advances          452,826        10,668    3.15
    Long-term debt                           111,607         6,366    7.62
                                         -----------  ------------
      Total borrowed funds                   961,231        24,288    3.38
                                         -----------  ------------
      Total interest-bearing
       liabilities                         6,650,369       171,704    3.45
                                                      ------------
Non-interest-bearing liabilities:
  Non-interest-bearing deposits              681,615
  Other liabilities                           80,957
                                         -----------
     Total liabilities                     7,412,941
Shareholders' equity                         849,912
                                         -----------
     Total liabilities and shareholders'
      equity                             $ 8,262,853
                                         ===========
Net interest revenue                                  $    186,830
                                                      ============
Net interest-rate spread                                              2.98%
                                                                   =======
Net interest margin (4)                                               3.35%
                                                                   =======
(1)  Interest revenue on tax-exempt securities and loans has been increased
     to reflect comparable interest on taxable securities and loans.  The
     rate used was 39%, reflecting the statutory federal income tax rate
     and the federal tax adjusted state income tax rate.
(2)  Included in the average balance of loans outstanding are loans where
     the accrual of interest has been discontinued.
(3)  Securities available for sale are shown at amortized cost.  Pretax
     unrealized gains of $13.0 million in 2009 and $5.7 million in 2008 are
     included in other assets for purposes of this presentation.
(4)  Net interest margin is taxable equivalent net-interest revenue divided
     by average interest-earning assets.

For more information:
Rex S. Schuette
Chief Financial Officer
(706) 781-2266
Email Contact


SOURCE: United Community Banks, Inc.

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