United Community Banks, Inc.
Apr 22, 2010

United Community Banks, Inc. Reports Net Operating Loss for First Quarter 2010

BLAIRSVILLE, GA, Apr 22, 2010 (MARKETWIRE via COMTEX News Network) -- United Community Banks, Inc. (NASDAQ: UCBI)

--  Non-performing assets of $417 million at quarter-end, but $317 million
    after transaction with private equity firm in April
--  Provision for loan losses of $75 million, charge-offs of $56.7 million
--  Allowance-to-loans ratio of 3.48 percent, up from 3.02 percent in
    previous quarter
--  Margin improves to 3.49 percent, up 41 basis points from one year ago
--  Sold consulting services business
--  Capital ratios remain strong

United Community Banks, Inc. (NASDAQ: UCBI) today reported a net operating loss from continuing operations of $34.5 million, or 39 cents per diluted share, for the first quarter of 2010.

"The first quarter was difficult in terms of credit, as we had anticipated," stated Jimmy Tallent, president and chief executive officer. "We were not able to dispose of foreclosed properties at the same pace as in previous quarters, in large part due to the harshest winter weather our markets have seen in many years. However, our sale of $100 million in illiquid non-performing assets by the end of April will prove to be beneficial. The sale, which includes approximately $72 million of non-performing loans and $28 million of foreclosed properties, shows our determination to find innovative ways to move through this credit cycle and into recovery more quickly."

Total loans were $5.0 billion at quarter-end, down $159 million from the end of the fourth quarter and $641 million from a year earlier. As of March 31, 2010, residential construction loans were $960 million, or 19 percent of total loans, down $90 million for the quarter and down $470 million from a year ago. New lending during the quarter of $57 million, primarily commercial loans in metropolitan Atlanta, offset some of this decline. Annualized loan growth of 4 percent is consistent with that of 2009.

Taxable equivalent net interest revenue of $61.3 million for the first quarter reflected an increase of $3.9 million compared to the first quarter of 2009. The taxable equivalent net interest margin was 3.49 percent, up 41 basis points from a year ago and up 9 basis points from the fourth quarter of 2009. "Our ongoing strategies of building margin while maintaining liquidity are continuing to be effective," Tallent said.

"We had our fifth consecutive quarter of core transaction deposit growth, with an increase of $53 million from the prior quarter or 9 percent on an annualized basis," Tallent continued. "We believe much of this growth is related to disruption in the banking industry, and the favorable perception of United as a strong bank with strong service. We are emphasizing these positive attributes in our marketing programs."

The first quarter 2010 provision for loan losses decreased to $75 million from $90 million in the fourth quarter of 2009. Net charge-offs also decreased, to $56.7 million, compared to $84.6 million in the fourth quarter. Non-performing assets increased to $417 million at quarter-end from $385 million at year-end. The ratio of non-performing assets to total assets at the end of the first quarter of 2010 and fourth quarter of 2009 was 5.32 percent and 4.81 percent, respectively. Including the planned sale of $100 million of non-performing assets, the pro forma quarter-end ratio of non-performing assets to total assets is 4.05 percent.

"The sale of these non-performing assets, which we announced on April 1, is a very unique and positive transaction for United and its shareholders," stated Tallent. "It eliminates $100 million of our more illiquid non-performing assets while avoiding any additional charge-offs and credit costs associated with them. This is particularly attractive due to the lack of investor interest we have seen in larger tracts of land outside of our metro Atlanta markets. The transaction reduces non-performing assets by about 25 percent while attaining their highest current economic value and preserving our capital position. This transaction will help us move through the credit cycle and into recovery sooner."

Operating fee revenue, all periods presented, excludes consulting services revenue because United's consulting services subsidiary, Brintech, was sold on March 31. "Brintech has been part of United Community Banks for 10 years," Tallent said. "At this time our focus is best placed on returning the company to profitability through our core businesses. Consulting requires scale to grow, and we found an acquirer that is a good fit and allows most of Brintech's employees to continue in their roles."

The results of United's operations for all periods presented in the attached schedules have been restated to show earnings from continuing operations, which excludes Brintech's fee revenue and operating expenses. Also, the net income or loss from the discontinued operations is reported as a separate line in the income statement.

Operating fee revenue for United was $11.7 million for the first quarter of 2010, compared to $11.8 million a year ago. Service charges and fees of $7.4 million were up $413,000, due primarily to new accounts and more ATM and debit card transactions. Mortgage loan fees were down $1.2 million, to $1.5 million, due to lower refinancing activity. Other fee revenue increased $1.0 million to $2.1 million, due primarily to the ineffectiveness of cash flow hedges on a certain portion of the company's prime-based loans that resulted in an acceleration of $520,000 of deferred gains and higher earnings of $320,000 on bank-owned life insurance assets.

Due to higher foreclosed property costs, operating expenses increased by $3.0 million, from $51.8 million in the first quarter of 2009 to $54.8 million in the first quarter of 2010. Operating expenses for the first quarter of 2009, as noted in the financial highlights, exclude a $70 million non-cash goodwill impairment charge and $2.9 million in severance costs. Foreclosed property costs for the first quarter of 2010 were $10.8 million as compared to $4.3 million in the first quarter of 2009 and $14.4 million in the fourth quarter of 2009. Foreclosed property costs in the first quarter included $2.7 million for maintenance, property taxes and other related costs. In addition, write-downs relating to the sale of properties totaled $3.5 million and write-downs to help expedite future sales of other foreclosed properties totaled $4.6 million. Salary and benefit costs totaled $24.4 million, a decrease of $3.0 million from last year due primarily to the 10 percent reduction in workforce implemented at the end of the first quarter of 2009.

The effective tax rate for the first quarter of 2010 was 40 percent, compared to 45 percent in the fourth quarter of 2009 and 14 percent in the first quarter of 2009. The fourth quarter 2009 tax benefit included the favorable settlement of a several-year state tax audit dispute for which the company was fully reserved due to the uncertainty of the tax position. The first quarter 2009 effective rate was lower due to the goodwill impairment charge which was not a taxable event and therefore did not result in the recognition of a tax benefit. The effective tax rate for 2010 is expected to be 40 percent, slightly higher than the effective tax rate for the full year 2009.

As of March 31, 2010, United Community Banks' regulatory capital ratios were as follows: Tier I Risk-Based Capital of 11.7 percent; Leverage of 8.1 percent; and Total Risk-Based Capital of 14.4 percent. The quarterly average Tangible Equity-to-Assets Ratio was 9.4 percent and the Tangible Common Equity-to-Assets Ratio was 7.1 percent.

"The quarter was eventful and productive, and one that I would like to think sets the tone for the balance of 2010," concluded Tallent. "Moving $100 million of non-performing assets out of the bank doesn't put all of our challenges behind us, but it is a significant milestone and a giant leap in the right direction. We have said for some time now that we would not rest until United returns to its accustomed profitability. That commitment continues and, while we aren't there yet, we have made significant progress."

Conference Call

United Community Banks will hold a conference call today, Thursday, April 22, 2010, at 11 a.m. ET to discuss the contents of this news release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the password '67352551.' The conference call also will be webcast and can be accessed by selecting 'Calendar of Events' within the Investor Relations section of the company's website at www.ucbi.com.

About United Community Banks, Inc.

Headquartered in Blairsville, United Community Banks is the third-largest bank holding company in Georgia. United Community Banks has assets of $7.8 billion and operates 27 community banks with 107 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
                        2010
                    -----------
(in thousands,
 except per share
 data; taxable         First
 equivalent)          Quarter
                    -----------
INCOME SUMMARY
Interest revenue    $    89,849
Interest expense         28,570
                    -----------
  Net interest
   revenue               61,279
Provision for loan
 losses                  75,000
Operating fee
 revenue (1)             11,666
                    -----------
  Total operating
   revenue (1)           (2,055)
Operating expenses
 (2)                     54,820
                    -----------
 Operating loss
  from continuing
  operations before
  taxes                 (56,875)
Operating income
 tax benefit            (22,417)
                    -----------
  Net operating
   loss from
   continuing
   operations (1)(2)    (34,458)
Gain from
 acquisition, net
 of tax expense               -
Noncash goodwill
 impairment charges           -
Severance costs,
 net of tax benefit           -
(Loss) income from
 discontinued
 operations                (101)
Gain from sale of
 subsidiary, net of
 income taxes and
 selling costs            1,266
                    -----------
  Net loss              (33,293)
Preferred dividends
 and discount
 accretion                2,572
                    -----------
Net loss available
 to common
 shareholders       $   (35,865)
                    ===========
PERFORMANCE
 MEASURES
  Per common share:
    Diluted operating
     loss from
     continuing
     operations
     (1)(2)         $      (.39)
    Diluted loss
     from
     continuing
     operations            (.39)
    Diluted loss           (.38)
    Stock dividends
     declared (6)             -
    Book value             7.95
    Tangible book
     value (4)             5.62
  Key performance
   ratios:
    Return on equity
     (3)(5)              (20.10)%
    Return on assets
     (5)                  (1.70)
    Net interest margin
     (5)                   3.49
    Operating
     efficiency ratio
     from continuing
     operations
     (1)(2)               75.22
    Equity to assets      11.90
    Tangible equity to
     assets (4)            9.39
    Tangible common
     equity to assets
     (4)                   7.13
    Tangible common
     equity to
     risk-weighted
     assets (4)           10.03
ASSET QUALITY *
  Non-performing
   loans            $   280,802
  Foreclosed
   properties           136,275
                    -----------
  Total
   non-performing
   assets (NPAs)        417,077
  Allowance for loan
   losses               173,934
  Net charge-offs        56,668
  Allowance for loan
   losses to loans         3.48%
  Net charge-offs to
   average loans (5)       4.51
  NPAs to loans and
   foreclosed
   properties              8.13
  NPAs to total
   assets                  5.32
AVERAGE BALANCES
  Loans             $ 5,172,847
  Investment
   securities         1,517,696
  Earning assets      7,084,891
  Total assets        7,946,303
  Deposits            6,570,016
  Shareholders
   equity               945,426
  Common shares -
   basic                 94,390
  Common shares -
   diluted               94,390
AT PERIOD END
  Loans *           $ 4,992,045
  Investment
   securities         1,526,589
  Total assets        7,837,018
  Deposits            6,487,588
  Shareholders
   equity               925,895
  Common shares
   outstanding           94,176
                                             2009
                    -----------------------------------------------------
(in thousands,
 except per share
 data; taxable        Fourth         Third        Second         First
 equivalent)          Quarter       Quarter       Quarter       Quarter
                    -----------   -----------   -----------   -----------
INCOME SUMMARY
Interest revenue    $    97,481   $   101,181   $   102,737   $   103,562
Interest expense         33,552        38,177        41,855        46,150
                    -----------   -----------   -----------   -----------
  Net interest
   revenue               63,929        63,004        60,882        57,412
Provision for loan
 losses                  90,000        95,000        60,000        65,000
Operating fee
 revenue (1)             14,447        13,389        11,305        11,823
                    -----------   -----------   -----------   -----------
  Total operating
   revenue (1)          (11,624)      (18,607)       12,187         4,235
Operating expenses
 (2)                     60,126        51,426        53,710        51,788
                    -----------   -----------   -----------   -----------
  Operating loss
   from continuing
   operations before
   taxes                (71,750)      (70,033)      (41,523)      (47,553)
Operating income
 tax benefit            (31,687)      (26,252)      (18,394)      (15,421)
                    -----------   -----------   -----------   -----------
  Net operating loss
   from continuing
   operations (1)(2)    (40,063)      (43,781)      (23,129)      (32,132)
Gain from
 acquisition, net
 of tax expense               -             -         7,062             -
Noncash goodwill
 impairment charges           -       (25,000)            -       (70,000)
Severance costs,
 net of tax benefit           -             -             -        (1,797)
(Loss) income from
 discontinued
 operations                 228            63            66           156
Gain from sale of
 subsidiary, net of
 income taxes and
 selling costs                -             -             -             -
                    -----------   -----------   -----------   -----------
  Net loss              (39,835)      (68,718)      (16,001)     (103,773)
Preferred dividends
 and discount
 accretion                2,567         2,562         2,559         2,554
                    -----------   -----------   -----------   -----------
Net loss available
 to common
 shareholders       $   (42,402)  $   (71,280)  $   (18,560)  $  (106,327)
                    ===========   ===========   ===========   ===========
PERFORMANCE
 MEASURES
  Per common share:
    Diluted operating
     loss from
     continuing
     operations
     (1)(2)         $      (.45)  $      (.93)  $      (.53)  $      (.72)
    Diluted loss
     from
     continuing
     operations            (.45)        (1.43)         (.38)        (2.20)
    Diluted loss           (.45)        (1.43)         (.38)        (2.20)
    Stock dividends
     declared (6)             -     1 for 130     1 for 130     1 for 130
    Book value             8.36          8.85         13.87         14.70
    Tangible book
     value (4)             6.02          6.50          8.85          9.65
  Key performance
   ratios:
    Return on equity
     (3)(5)              (22.08)%      (45.52)%      (11.42)%      (58.28)%
    Return on assets
     (5)                  (1.91)        (3.32)         (.78)        (5.03)
    Net interest
     margin (5)            3.40          3.39          3.28          3.08
    Operating
     efficiency ratio
     from continuing
     operations
     (1)(2)               78.74         68.35         73.68         75.13
    Equity to assets      11.94         10.27         10.71         11.56
    Tangible equity
     to assets (4)         9.53          7.55          7.96          8.24
    Tangible common
     equity to assets
     (4)                   7.37          5.36          5.77          6.09
    Tangible common
     equity to
     risk-weighted
     assets (4)           10.39         10.67          7.49          8.03
ASSET QUALITY *
  Non-performing
   loans            $   264,092   $   304,381   $   287,848   $   259,155
  Foreclosed
   properties           120,770       110,610       104,754        75,383
                    -----------   -----------   -----------   -----------
    Total
     non-performing
     assets (NPAs)      384,862       414,991       392,602       334,538
  Allowance for loan
   losses               155,602       150,187       145,678       143,990
  Net charge-offs        84,585        90,491        58,312        43,281
  Allowance for loan
   losses to loans         3.02%         2.80%         2.64%         2.56%
  Net charge-offs to
   average loans (5)       6.37          6.57          4.18          3.09
  NPAs to loans and
   foreclosed
   properties              7.30          7.58          6.99          5.86
  NPAs to total
   assets                  4.81          4.91          4.63          4.09
AVERAGE BALANCES
  Loans             $ 5,357,150   $ 5,565,498   $ 5,597,259   $ 5,675,054
  Investment
   securities         1,528,805     1,615,499     1,771,482     1,712,654
  Earning assets      7,486,790     7,400,539     7,442,178     7,530,230
  Total assets        8,286,544     8,208,199     8,212,140     8,372,281
  Deposits            6,835,052     6,689,948     6,544,537     6,780,531
  Shareholders'
   equity               989,279       843,130       879,210       967,505
  Common shares -
   basic                 94,219        49,771        48,794        48,324
  Common shares -
   diluted               94,219        49,771        48,794        48,324
AT PERIOD END
  Loans *           $ 5,151,476   $ 5,362,689   $ 5,513,087   $ 5,632,705
  Investment
   securities         1,530,047     1,532,514     1,816,787     1,719,033
  Total assets        7,999,914     8,443,617     8,477,355     8,171,663
  Deposits            6,627,834     6,821,306     6,848,760     6,616,488
  Shareholders'
   equity               962,321     1,006,638       855,272       888,853
  Common shares
   outstanding           94,046        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 and revenue generated
by discontinued operations in all periods presented. (2) Excludes the
goodwill impairment charges of $25 million and $70 million in the third and
first quarters of 2009, respectively, severance costs of $2.9 million, net
of income tax benefit of $1.1 million in the first quarter of 2009 and
expenses relating to discontinued operations for all periods presented. (3)
Net loss available to common shareholders, which is net of preferred stock
dividends, divided by average realized common equity, which excludes
accumulated other comprehensive income (loss). (4) Excludes effect of
acquisition related intangibles and associated amortization. (5)
Annualized. (6) Number of new shares issued for shares currently held.
* Excludes loans and foreclosed properties covered by loss sharing
agreements with the FDIC.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
                                                                  First
                                        2010         2009        Quarter
                                     ----------   ----------
(in thousands, except per share        First        First       2010-2009
data; taxable equivalent)              Quarter      Quarter      Change
                                     ----------   ----------   -----------
INCOME SUMMARY
Interest revenue                     $   89,849   $  103,562
Interest expense                         28,570       46,150
                                     ----------   ----------
    Net interest revenue                 61,279       57,412            7 %
Provision for loan losses                75,000       65,000
Operating fee revenue (1)                11,666       11,823           (1)
                                     ----------   ----------
    Total operating revenue (1)          (2,055)       4,235         (149)
Operating expenses (2)                   54,820       51,788            6
                                     ----------   ----------
    Operating loss from continuing
     operations before taxes            (56,875)     (47,553)         (20)
Operating income tax benefit            (22,417)     (15,421)
                                     ----------   ----------
    Net operating loss from
     continuing operations (1)(2)       (34,458)     (32,132)          (7)
Gain from acquisition, net of tax
 expense                                      -            -
Noncash goodwill impairment charges           -      (70,000)
Severance costs, net of tax benefit           -       (1,797)
(Loss) income from discontinued
 operations                                (101)         156
Gain from sale of subsidiary, net of
 income taxes and selling costs           1,266            -
                                     ----------   ----------
    Net loss                            (33,293)    (103,773)          68
Preferred dividends and discount
 accretion                                2,572        2,554
                                     ----------   ----------
Net loss available to common
 shareholders                        $  (35,865)  $ (106,327)
                                     ==========   ==========
PERFORMANCE MEASURES
  Per common share:
    Diluted operating loss from
     continuing operations (1)(2)    $     (.39)  $     (.72)          46
    Diluted loss from continuing
     operations                            (.39)       (2.20)          82
    Diluted loss                           (.38)       (2.20)          83
    Stock dividends declared (6)              -    1 for 130
    Book value                             7.95        14.70          (46)
    Tangible book value (4)                5.62         9.65          (42)
  Key performance ratios:
    Return on equity (3)(5)              (20.10)%     (58.28)%
    Return on assets (5)                  (1.70)       (5.03)
    Net interest margin (5)                3.49         3.08
    Operating efficiency ratio from
     continuing operations (1)(2)         75.22        75.13
    Equity to assets                      11.90        11.56
    Tangible equity to assets (4)          9.39         8.24
    Tangible common equity to assets
     (4)                                   7.13         6.09
    Tangible common equity to
     risk-weighted assets (4)             10.03         8.03
ASSET QUALITY *
  Non-performing loans               $  280,802   $  259,155
  Foreclosed properties                 136,275       75,383
                                     ----------   ----------
    Total non-performing assets
     (NPAs)                             417,077      334,538
  Allowance for loan losses             173,934      143,990
  Net charge-offs                        56,668       43,281
  Allowance for loan losses to loans       3.48 %       2.56 %
  Net charge-offs to average loans
   (5)                                     4.51         3.09
  NPAs to loans and foreclosed
   properties                              8.13         5.86
  NPAs to total assets                     5.32         4.09
AVERAGE BALANCES
  Loans                              $5,172,847   $5,675,054           (9)
  Investment securities               1,517,696    1,712,654          (11)
  Earning assets                      7,084,891    7,530,230           (6)
  Total assets                        7,946,303    8,372,281           (5)
  Deposits                            6,570,016    6,780,531           (3)
  Shareholders' equity                  945,426      967,505           (2)
  Common shares - basic                  94,390       48,324
  Common shares - diluted                94,390       48,324
AT PERIOD END
  Loans *                            $4,992,045   $5,632,705          (11)
  Investment securities               1,526,589    1,719,033          (11)
  Total assets                        7,837,018    8,171,663           (4)
  Deposits                            6,487,588    6,616,488           (2)
  Shareholders' equity                  925,895      888,853            4
  Common shares outstanding              94,176       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 and revenue generated
by discontinued operations in all periods presented.  (2)  Excludes the
goodwill impairment charges of $25 million and $70 million in the third and
first quarters of 2009, respectively, severance costs of $2.9 million, net
of income tax benefit of $1.1 million in the first quarter of 2009 and
expenses relating to discontinued operations for all periods presented.
(3)  Net loss available to common shareholders, which is net of preferred
stock dividends, divided by average realized common equity, which excludes
accumulated other comprehensive income (loss).  (4)  Excludes effect of
acquisition related intangibles and associated amortization.  (5)
Annualized.  (6)  Number of new shares issued for shares currently held.
* 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,        2010                        2009
 except per share   --------   ------------------------------------------
 data; taxable       First     Fourth      Third     Second      First
 equivalent)        Quarter    Quarter    Quarter    Quarter     Quarter
                    --------   --------   --------   --------   ---------
Interest revenue
 reconciliation
Interest revenue -
 taxable equivalent $ 89,849   $ 97,481   $101,181   $102,737   $ 103,562
Taxable equivalent
 adjustment             (493)      (601)      (580)      (463)       (488)
                    --------   --------   --------   --------   ---------
  Interest
   revenue (GAAP)   $ 89,356   $ 96,880   $100,601   $102,274   $ 103,074
                    ========   ========   ========   ========   =========
Net interest
 revenue
 reconciliation
Net interest
 revenue - taxable
 equivalent         $ 61,279   $ 63,929   $ 63,004   $ 60,882   $  57,412
Taxable equivalent
 adjustment             (493)      (601)      (580)      (463)       (488)
                    --------   --------   --------   --------   ---------
  Net interest
   revenue (GAAP)   $ 60,786   $ 63,328   $ 62,424   $ 60,419   $  56,924
                    ========   ========   ========   ========   =========
Fee revenue
 reconciliation
Operating fee
 revenue            $ 11,666   $ 14,447   $ 13,389   $ 11,305   $  11,823
Gain from
 acquisition               -          -          -     11,390           -
                    --------   --------   --------   --------   ---------
  Fee revenue
   (GAAP)           $ 11,666   $ 14,447   $ 13,389   $ 22,695   $  11,823
                    ========   ========   ========   ========   =========
Total revenue
 reconciliation
Total operating
 revenue            $ (2,055)  $(11,624)  $(18,607)  $ 12,187   $   4,235
Taxable equivalent
 adjustment             (493)      (601)      (580)      (463)       (488)
Gain from
 acquisition               -          -          -     11,390           -
                    --------   --------   --------   --------   ---------
  Total revenue
   (GAAP)           $ (2,548)  $(12,225)  $(19,187)  $ 23,114   $   3,747
                    ========   ========   ========   ========   =========
Expense
 reconciliation
Operating expense   $ 54,820   $ 60,126   $ 51,426   $ 53,710   $  51,788
Noncash goodwill
 impairment charge         -          -     25,000          -      70,000
Severance costs            -          -          -          -       2,898
                    --------   --------   --------   --------   ---------
  Operating
   expense (GAAP)   $ 54,820   $ 60,126   $ 76,426   $ 53,710   $ 124,686
                    ========   ========   ========   ========   =========
Loss from
 continuing
 operations before
 taxes
 reconciliation
Operating loss from
 continuing
 operations before
 taxes              $(56,875)  $(71,750)  $(70,033)  $(41,523)  $ (47,553)
Taxable equivalent
 adjustment             (493)      (601)      (580)      (463)       (488)
Gain from
 acquisition               -          -          -     11,390           -
Noncash goodwill
 impairment charge         -          -    (25,000)         -     (70,000)
Severance costs            -          -          -          -      (2,898)
                    --------   --------   --------   --------   ---------
  Loss from
   continuing
   operations
   before taxes
   (GAAP)           $(57,368)  $(72,351)  $(95,613)  $(30,596)  $(120,939)
                    ========   ========   ========   ========   =========
Income tax benefit
 reconciliation
Operating income
 tax benefit        $(22,417)  $(31,687)  $(26,252)  $(18,394)  $ (15,421)
Taxable equivalent
 adjustment             (493)      (601)      (580)      (463)       (488)
Gain from
 acquisition, tax
 expense                   -          -          -      4,328           -
Severance costs,
 tax benefit               -          -          -          -      (1,101)
                    --------   --------   --------   --------   ---------
  Income tax
   benefit (GAAP)   $(22,910)  $(32,288)  $(26,832)  $(14,529)  $ (17,010)
                    ========   ========   ========   ========   =========
Diluted loss from
 continuing
 operations per
 common share
 reconciliation
Diluted operating
 loss from
 continuing
 operations per
 common share       $   (.39)  $   (.45)  $   (.93)  $   (.53)  $    (.72)
Gain from
 acquisition               -          -          -        .15           -
Noncash goodwill
 impairment charge         -          -       (.50)         -       (1.45)
Severance costs            -          -          -          -        (.03)
                    --------   --------   --------   --------   ---------
  Diluted loss
   from
   continuing
   operations per
   common share
   (GAAP)           $   (.39)  $   (.45)  $  (1.43)  $   (.38)  $   (2.20)
                    ========   ========   ========   ========   =========
Book value per
 common share
 reconciliation
Tangible book value
 per common share   $   5.62   $   6.02   $   6.50   $   8.85   $    9.65
Effect of goodwill
 and other
 intangibles            2.33       2.34       2.35       5.02        5.05
                    --------   --------   --------   --------   ---------
  Book value per
   common share
   (GAAP)           $   7.95   $   8.36   $   8.85   $  13.87   $   14.70
                    ========   ========   ========   ========   =========
Efficiency ratio
 from continuing
 operations
 reconciliation
Operating
 efficiency ratio
 from continuing
 operations            75.22 %    78.74 %    68.35 %    73.68 %     75.13 %
Gain from
 acquisition               -          -          -      (9.96)          -
Noncash goodwill
 impairment charge         -          -      33.22          -      101.55
Severance costs            -          -          -          -        4.20
                    --------   --------   --------   --------   ---------
  Efficiency
   ratio from
   continuing
   operations
   (GAAP)              75.22 %    78.74 %   101.57 %    63.72 %    180.88 %
                    ========   ========   ========   ========   =========
Average equity to
 assets
 reconciliation
Tangible common
 equity to assets       7.13 %     7.37 %     5.36 %     5.77 %      6.09 %
Effect of preferred
 equity                 2.26       2.16       2.19       2.19        2.15
                    --------   --------   --------   --------   ---------
  Tangible equity
   to assets            9.39       9.53       7.55       7.96        8.24
Effect of goodwill
 and other
 intangibles            2.51       2.41       2.72       2.75        3.32
                    --------   --------   --------   --------   ---------
  Equity to
   assets (GAAP)       11.90 %    11.94 %    10.27 %    10.71 %     11.56 %
                    ========   ========   ========   ========   =========
Actual tangible
 common equity to
 risk-weighted
 assets
 reconciliation
Tangible common
 equity to
 risk-weighted
 assets                10.03 %    10.39 %    10.67 %     7.49 %      8.03 %
Effect of other
 comprehensive
 income                 (.85)      (.87)      (.90)      (.72)      (1.00)
Effect of deferred
 tax limitation        (1.75)     (1.27)      (.58)      (.22)          -
Effect of trust
 preferred              1.00        .97        .92        .90         .89
Effect of preferred
 equity                 3.29       3.19       3.04       2.99        2.96
                    --------   --------   --------   --------   ---------
  Tier I capital
   ratio
   (Regulatory)        11.72 %    12.41 %    13.15 %    10.44 %     10.88 %
                    ========   ========   ========   ========   =========
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End
                   2010                          2009
                ----------- -----------------------------------------------
                  First       Fourth      Third       Second      First
(in millions)   Quarter (1) Quarter (1) Quarter (1) Quarter (1)   Quarter
                ----------- ----------- ----------- ----------- -----------
LOANS BY
 CATEGORY
Commercial
 (sec. by RE)   $     1,765 $     1,779 $     1,787 $     1,797 $     1,779
Commercial
 construction           357         363         380         379         377
Commercial &
 industrial             381         390         403         399         387
                ----------- ----------- ----------- ----------- -----------
  Total
   commercial         2,503       2,532       2,570       2,575       2,543
Residential
 construction           960       1,050       1,185       1,315       1,430
Residential
 mortgage             1,390       1,427       1,461       1,470       1,504
Consumer /
 installment            139         142         147         153         156
                ----------- ----------- ----------- ----------- -----------
  Total
   loans        $     4,992 $     5,151 $     5,363 $     5,513 $     5,633
                =========== =========== =========== =========== ===========
LOANS BY MARKET
Atlanta MSA     $     1,404 $     1,435 $     1,526 $     1,605 $     1,660
Gainesville MSA         372         390         402         413         422
North Georgia         1,814       1,884       1,942       1,978       2,014
Western North
 Carolina               756         772         786         794         808
Coastal Georgia         388         405         440         455         460
East Tennessee          258         265         267         268         269
                ----------- ----------- ----------- ----------- -----------
  Total
   loans        $     4,992 $     5,151 $     5,363 $     5,513 $     5,633
                =========== =========== =========== =========== ===========
RESIDENTIAL
 CONSTRUCTION
Dirt loans
  Acquisition
   &
   development  $       290 $       332 $       380 $       413 $       445
  Land loans            124         127         159         159         155
  Lot loans             321         336         336         369         390
                ----------- ----------- ----------- ----------- -----------
    Total               735         795         875         941         990
                ----------- ----------- ----------- ----------- -----------
House loans
  Spec                  153         178         218         268         317
  Sold                   72          77          92         106         123
                ----------- ----------- ----------- ----------- -----------
    Total               225         255         310         374         440
                ----------- ----------- ----------- ----------- -----------
Total
 residential
 construction   $       960 $     1,050 $     1,185 $     1,315 $     1,430
                =========== =========== =========== =========== ===========
RESIDENTIAL
 CONSTRUCTION -
 ATLANTA MSA
Dirt loans
  Acquisition
   &
   development  $        66 $        76 $       100 $       124 $       148
  Land loans             43          43          61          63          52
  Lot loans              47          52          54          81          98
                ----------- ----------- ----------- ----------- -----------
    Total               156         171         215         268         298
                ----------- ----------- ----------- ----------- -----------
House loans
  Spec                   58          68          91         127         164
  Sold                   14          16          22          29          33
                ----------- ----------- ----------- ----------- -----------
    Total                72          84         113         156         197
                ----------- ----------- ----------- ----------- -----------
Total
 residential
 construction   $       228 $       255 $       328 $       424 $       495
                =========== =========== =========== =========== ===========
(1)  Excludes total loans of $79.5 million, $85.1 million, $104.0 million
and $109.9 million as of March 31, 2010, December 31, 2009, 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.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End
                  2010              2009
                ----------- -----------------------
                                                      Linked    Year over
                  First       Fourth      First       Quarter      Year
(in millions)   Quarter (1) Quarter (1)   Quarter     Change      Change
                ----------- ----------- ----------- ----------  ----------
LOANS BY
 CATEGORY
Commercial
 (sec. by RE)   $     1,765 $     1,779 $     1,779 $      (14) $      (14)
Commercial
 construction           357         363         377         (6)        (20)
Commercial &
 industrial             381         390         387         (9)         (6)
                ----------- ----------- -----------
  Total
   commercial         2,503       2,532       2,543        (29)        (40)
Residential
 construction           960       1,050       1,430        (90)       (470)
Residential
 mortgage             1,390       1,427       1,504        (37)       (114)
Consumer /
 installment            139         142         156         (3)        (17)
                ----------- ----------- -----------
  Total
   loans        $     4,992 $     5,151 $     5,633       (159)       (641)
                =========== =========== ===========
LOANS BY MARKET
Atlanta MSA     $     1,404 $     1,435 $     1,660        (31)       (256)
Gainesville MSA         372         390         422        (18)        (50)
North Georgia         1,814       1,884       2,014        (70)       (200)
Western North
 Carolina               756         772         808        (16)        (52)
Coastal Georgia         388         405         460        (17)        (72)
East Tennessee          258         265         269         (7)        (11)
                ----------- ----------- -----------
  Total
   loans        $     4,992 $     5,151 $     5,633       (159)       (641)
                =========== =========== ===========
RESIDENTIAL
 CONSTRUCTION
Dirt loans
  Acquisition
   &
   development  $       290 $       332 $       445        (42)       (155)
  Land loans            124         127         155         (3)        (31)
  Lot loans             321         336         390        (15)        (69)
                ----------- ----------- -----------
    Total               735         795         990        (60)       (255)
                ----------- ----------- -----------
House loans
  Spec                  153         178         317        (25)       (164)
  Sold                   72          77         123         (5)        (51)
                ----------- ----------- -----------
    Total               225         255         440        (30)       (215)
                ----------- ----------- -----------
Total
 residential
 construction   $       960 $     1,050 $     1,430        (90)       (470)
                =========== =========== ===========
RESIDENTIAL
 CONSTRUCTION -
 ATLANTA MSA
Dirt loans
  Acquisition
   &
   development  $        66 $        76 $       148        (10)        (82)
  Land loans             43          43          52          -          (9)
  Lot loans              47          52          98         (5)        (51)
                ----------- ----------- -----------
    Total               156         171         298        (15)       (142)
                ----------- ----------- -----------
House loans
  Spec                   58          68         164        (10)       (106)
  Sold                   14          16          33         (2)        (19)
                ----------- ----------- -----------
    Total                72          84         197        (12)       (125)
                ----------- ----------- -----------
Total
 residential
 construction   $       228 $       255 $       495        (27)       (267)
                =========== =========== ===========
(1)  Excludes total loans of $79.5 million, $85.1 million, $104.0 million
and $109.9 million as of March 31, 2010, December 31, 2009, 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.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)

                                             First Quarter 2010
                                  ----------------------------------------
                                  Non-performing Foreclosed       Total
(in thousands)                        Loans      Properties       NPAs
                                  ------------  ------------  ------------
NPAs BY CATEGORY
Commercial (sec. by RE)           $     45,918  $     21,597  $     67,515
Commercial construction                 23,556        14,285        37,841
Commercial & industrial                  3,610             -         3,610
                                  ------------  ------------  ------------
     Total commercial                   73,084        35,882       108,966
Residential construction               147,326        74,220       221,546
Residential mortgage                    57,920        26,173        84,093
Consumer / installment                   2,472             -         2,472
                                  ------------  ------------  ------------
     Total NPAs                   $    280,802  $    136,275  $    417,077
                                  ============  ============  ============
NPAs BY MARKET
Atlanta MSA                       $     81,914  $     36,951  $    118,865
Gainesville MSA                         17,058         3,192        20,250
North Georgia                          109,280        63,128       172,408
Western North Carolina                  31,353         8,588        39,941
Coastal Georgia                         33,438        21,871        55,309
East Tennessee                           7,759         2,545        10,304
                                  ------------  ------------  ------------
     Total NPAs                   $    280,802  $    136,275  $    417,077
                                  ============  ============  ============
NPA ACTIVITY
Beginning Balance                 $    264,092  $    120,770  $    384,862
Loans placed on non-accrual            139,030             -       139,030
Payments received                       (5,733)            -        (5,733)
Loan charge-offs                       (58,897)            -       (58,897)
Foreclosures                           (49,233)       49,233             -
Capitalized costs                            -           320           320
Note / property sales                   (8,457)      (25,951)      (34,408)
Write downs                                  -        (4,579)       (4,579)
Net gains (losses) on sales                  -        (3,518)       (3,518)
                                  ------------  ------------  ------------
     Ending Balance               $    280,802  $    136,275  $    417,077
                                  ============  ============  ============
(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.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)
                                            Fourth Quarter 2009
                                  ----------------------------------------
                                 Non-performing  Foreclosed       Total
(in thousands)                        Loans      Properties       NPAs
                                  ------------  ------------  ------------
NPAs BY CATEGORY
Commercial (sec. by RE)           $     37,040  $     15,842  $     52,882
Commercial construction                 19,976         9,761        29,737
Commercial & industrial                  3,946             -         3,946
                                  ------------  ------------  ------------
     Total commercial                   60,962        25,603        86,565
Residential construction               142,332        76,519       218,851
Residential mortgage                    58,767        18,648        77,415
Consumer / installment                   2,031             -         2,031
                                  ------------  ------------  ------------
     Total NPAs                   $    264,092  $    120,770  $    384,862
                                  ============  ============  ============
NPAs BY MARKET
Atlanta MSA                       $    106,536  $     41,125  $    147,661
Gainesville MSA                          5,074         2,614         7,688
North Georgia                           87,598        53,072       140,670
Western North Carolina                  29,610         5,096        34,706
Coastal Georgia                         26,871        17,150        44,021
East Tennessee                           8,403         1,713        10,116
                                  ------------  ------------  ------------
     Total NPAs                   $    264,092  $    120,770  $    384,862
                                  ============  ============  ============
NPA ACTIVITY
Beginning Balance                 $    304,381  $    110,610  $    414,991
Loans placed on non-accrual            174,898             -       174,898
Payments received                      (26,935)            -       (26,935)
Loan charge-offs                       (88,427)            -       (88,427)
Foreclosures                           (79,983)       79,983             -
Capitalized costs                            -           981           981
Note / property sales                  (19,842)      (61,228)      (81,070)
Write downs                                  -        (2,209)       (2,209)
Net gains (losses) on sales                  -        (7,367)       (7,367)
                                  ------------  ------------  ------------
     Ending Balance               $    264,092  $    120,770  $    384,862
                                  ============  ============  ============
(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.
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
                                  ============  ============  ============
NPA ACTIVITY
Beginning Balance                 $    287,848  $    104,754  $    392,602
Loans placed on non-accrual            190,164             -       190,164
Payments received                      (16,597)            -       (16,597)
Loan charge-offs                       (92,359)            -       (92,359)
Foreclosures                           (56,624)       56,624             -
Capitalized costs                            -           579           579
Note / property sales                   (8,051)      (47,240)      (55,291)
Write downs                                  -        (1,906)       (1,906)
Net gains (losses) on sales                  -        (2,201)       (2,201)
                                  ------------  ------------  ------------
     Ending Balance               $    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.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality (1)
                                                    First Quarter 2010
                                                ---------------------------
                                                                   Net
                                                               Charge-Offs
                                                    Net        to Average
(in thousands)                                  Charge-Offs     Loans (2)
                                                ------------- ------------
NET CHARGE-OFFS BY CATEGORY
Commercial (sec. by RE)                         $       1,964          .45%
Commercial construction                                 2,206         2.48
Commercial & industrial                                 4,110         4.31
                                                -------------
     Total commercial                                   8,280         1.33
Residential construction                               43,100        17.32
Residential mortgage                                    4,551         1.31
Consumer / installment                                    737         2.12
                                                -------------
     Total                                      $      56,668         4.51
                                                =============
NET CHARGE-OFFS BY MARKET
Atlanta MSA                                     $      15,545         4.32%
Gainesville MSA                                         1,675         1.92
North Georgia                                          29,747         6.51
Western North Carolina                                  3,695         1.96
Coastal Georgia                                         5,649         5.74
East Tennessee                                            357          .55
                                                -------------
     Total                                      $      56,668         4.51
                                                =============
(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)
                                                    Fourth Quarter 2009
                                                ---------------------------
                                                                   Net
                                                               Charge-Offs
                                                    Net        to Average
(in thousands)                                  Charge-Offs     Loans (2)
                                                ------------- ------------
NET CHARGE-OFFS BY CATEGORY
Commercial (sec. by RE)                         $       3,896          .86%
Commercial construction                                 4,717         5.03
Commercial & industrial                                   153          .15
                                                -------------
     Total commercial                                   8,766         1.36
Residential construction                               67,393        23.87
Residential mortgage                                    7,026         1.93
Consumer / installment                                  1,400         3.83
                                                -------------
     Total                                      $      84,585         6.37
                                                =============
NET CHARGE-OFFS BY MARKET
Atlanta MSA                                     $      43,595        12.07%
Gainesville MSA                                         2,273         2.49
North Georgia                                          18,057         3.57
Western North Carolina                                 10,091         5.11
Coastal Georgia                                         8,109         7.72
East Tennessee                                          2,460         3.67
                                                -------------
     Total                                      $      84,585         6.37
                                                =============
(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
                                                ---------------------------
                                                                   Net
                                                               Charge-Offs
                                                    Net         to Average
(in thousands)                                  Charge-Offs     Loans (2)
                                                ------------- ------------
NET CHARGE-OFFS BY CATEGORY
Commercial (sec. by RE)                         $      10,568         2.33%
Commercial construction                                 4,369         4.55
Commercial & industrial                                 1,792         1.76
                                                -------------
     Total commercial                                  16,729         2.57
Residential construction                               67,520        21.31
Residential mortgage                                    5,051         1.36
Consumer / installment                                  1,191         3.13
                                                -------------
     Total                                      $      90,491         6.57
                                                =============
NET CHARGE-OFFS BY MARKET
Atlanta MSA                                     $      50,129        12.61%
Gainesville MSA                                         1,473         1.60
North Georgia                                          24,017         4.74
Western North Carolina                                  3,949         1.98
Coastal Georgia                                        10,051         8.78
East Tennessee                                            872         1.30
                                                -------------
     Total                                      $      90,491         6.57
                                                =============
(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
                                                          March 31,
                                                    ----------------------
(in thousands, except per share data)                  2010        2009
                                                    ----------  ----------
Interest revenue:
 Loans, including fees                              $   72,215  $   81,880
 Investment securities, including tax exempt of
  $311 and $319                                         16,203      20,752
 Federal funds sold, commercial paper and deposits
  in banks                                                 938         442
                                                    ----------  ----------
   Total interest revenue                               89,356     103,074
                                                    ----------  ----------
Interest expense:
 Deposits:
  NOW                                                    1,854       3,337
  Money market                                           1,757       2,237
  Savings                                                   84         127
  Time                                                  20,198      36,053
                                                    ----------  ----------
   Total deposit interest expense                       23,893      41,754
 Federal funds purchased, repurchase agreements and
  other short-term borrowings                            1,038         553
 Federal Home Loan Bank advances                           977       1,074
 Long-term debt                                          2,662       2,769
                                                    ----------  ----------
  Total interest expense                                28,570      46,150
                                                    ----------  ----------
  Net interest revenue                                  60,786      56,924
 Provision for loan losses                              75,000      65,000
                                                    ----------  ----------
  Net interest revenue after provision for loan
   losses                                              (14,214)     (8,076)
                                                    ----------  ----------
Fee revenue:
 Service charges and fees                                7,447       7,034
 Mortgage loan and other related fees                    1,479       2,651
 Brokerage fees                                            567         689
 Securities gains, net                                      61         303
 Other                                                   2,112       1,146
                                                    ----------  ----------
  Total fee revenue                                     11,666      11,823
                                                    ----------  ----------
  Total revenue                                         (2,548)      3,747
                                                    ----------  ----------
Operating expenses:
 Salaries and employee benefits                         24,360      27,313
 Communications and equipment                            3,273       3,646
 Occupancy                                               3,814       3,769
 Advertising and public relations                        1,043       1,044
 Postage, printing and supplies                          1,225       1,175
 Professional fees                                       1,943       3,281
 Foreclosed preoperty                                   10,813       4,319
 FDIC assessments and other regulatory charges           3,626       2,682
 Amortization of intangibles                               802         739
 Other                                                   3,921       3,820
 Goodwill impairment                                         -      70,000
 Severance costs                                             -       2,898
                                                    ----------  ----------
  Total operating expenses                              54,820     124,686
                                                    ----------  ----------
 Loss from continuing operations before income
  taxes                                                (57,368)   (120,939)
 Income tax benefit                                    (22,910)    (17,010)
                                                    ----------  ----------
  Net loss from continuing operations                  (34,458)   (103,929)
 (Loss) income from discontinued operations, net
   of income taxes                                        (101)        156
 Gain from sale of subsidiary, net of income
  taxes and selling costs                                1,266           -
                                                    ----------  ----------
  Net loss                                             (33,293)   (103,773)
 Preferred stock dividends and discount accretion        2,572       2,554
                                                    ----------  ----------
  Net loss available to common shareholders         $  (35,865) $ (106,327)
                                                    ==========  ==========
Loss from continuing operations per common share -
 Basic / Diluted                                    $     (.39) $    (2.20)
Loss per common share - Basic / Diluted                   (.38)      (2.20)
Weighted average common shares outstanding - Basic
 / Diluted                                              94,390      48,324
UNITED COMMUNITY BANKS, INC.
Consolidated Statement of Income (Unaudited)
                                Revised for Discontinued Operations
                         -------------------------------------------------
(in thousands, except
 per share data)           1Q10      4Q09      3Q09      2Q09      1Q09
                         --------  --------  --------  --------  ---------
Interest revenue:
 Loans, including fees   $ 72,215  $ 78,064  $ 80,874  $ 81,691  $  81,880
 Investment securities,
  including tax exempt     16,203    17,313    18,820    20,485     20,752
 Federal funds sold,
  commercial paper and
  deposits in banks           938     1,503       907        98        442
                         --------  --------  --------  --------  ---------
   Total interest
    revenue                89,356    96,880   100,601   102,274    103,074
                         --------  --------  --------  --------  ---------
Interest expense:
 Deposits:
  NOW                       1,854     2,315     2,528     2,843      3,337
  Money market              1,757     2,328     2,711     2,269      2,237
  Savings                      84       105       130       121        127
  Time                     20,198    24,026    28,183    32,064     36,053
                         --------  --------  --------  --------  ---------
   Total deposit
    interest expense       23,893    28,774    33,552    37,297     41,754
 Federal funds purchased,
  repurchase agreements
  and other short-term
  borrowings                1,038     1,081       613       595        553
 Federal Home Loan Bank
  advances                    977     1,045     1,300     1,203      1,074
 Long-term debt             2,662     2,652     2,712     2,760      2,769
                         --------  --------  --------  --------  ---------
  Total interest expense   28,570    33,552    38,177    41,855     46,150
                         --------  --------  --------  --------  ---------
  Net interest revenue     60,786    63,328    62,424    60,419     56,924
 Provision for loan
  losses                   75,000    90,000    95,000    60,000     65,000
                         --------  --------  --------  --------  ---------
  Net interest revenue
   after provision for
   loan losses            (14,214)  (26,672)  (32,576)      419     (8,076)
                         --------  --------  --------  --------  ---------
Fee revenue:
 Service charges and
  fees                      7,447     8,257     8,138     7,557      7,034
 Mortgage loan and other
  related fees              1,479     1,651     1,832     2,825      2,651
 Brokerage fees               567       443       456       497        689
 Securities gains
  (losses), net                61     2,015     1,149      (711)       303
 Gain from acquisition          -         -         -    11,390          -
 Other                      2,112     2,081     1,814     1,137      1,146
                         --------  --------  --------  --------  ---------
  Total fee revenue        11,666    14,447    13,389    22,695     11,823
                         --------  --------  --------  --------  ---------
  Total revenue            (2,548)  (12,225)  (19,187)   23,114      3,747
                         --------  --------  --------  --------  ---------
Operating expenses:
 Salaries and employee
  benefits                 24,360    24,061    23,889    26,305     27,313
 Communications and
  equipment                 3,273     3,819     3,640     3,571      3,646
 Occupancy                  3,814     4,003     4,063     3,818      3,769
 Advertising and public
  relations                 1,043       958       823     1,125      1,044
 Postage, printing and
  supplies                  1,225     1,307     1,270     1,288      1,175
 Professional fees          1,943     2,646     2,358     3,195      3,281
 Foreclosed preoperty      10,813    14,391     7,918     5,737      4,319
 FDIC assessments and
  other regulatory
  charges                   3,626     3,711     2,801     6,810      2,682
 Amortization of
  intangibles                 802       813       813       739        739
 Other                      3,921     4,417     3,851     1,122      3,820
 Goodwill impairment            -         -    25,000         -     70,000
 Severance costs                -         -         -         -      2,898
                         --------  --------  --------  --------  ---------
  Total operating
   expenses                54,820    60,126    76,426    53,710    124,686
                         --------  --------  --------  --------  ---------
 Loss from continuing
  operations before
  income taxes            (57,368)  (72,351)  (95,613)  (30,596)  (120,939)
 Income tax benefit       (22,910)  (32,288)  (26,832)  (14,529)   (17,010)
                         --------  --------  --------  --------  ---------
  Net loss from
   continuing operations  (34,458)  (40,063)  (68,781)  (16,067)  (103,929)
 (Loss) income from
  discontinued
  operations, net of
  income taxes               (101)      228        63        66        156
 Gain from sale of
  subsidiary, net of
  income taxes and
  selling costs             1,266         -         -         -          -
                         --------  --------  --------  --------  ---------
  Net loss                (33,293)  (39,835)  (68,718)  (16,001)  (103,773)
 Preferred stock
  dividends and discount
  accretion                 2,572     2,567     2,562     2,559      2,554
                         --------  --------  --------  --------  ---------
  Net loss available to
   common shareholders   $(35,865) $(42,402) $(71,280) $(18,560) $(106,327)
                         ========  ========  ========  ========  =========
Loss from continuing
 operations per common
 share - Basic / Diluted $   (.39) $   (.45) $  (1.43) $   (.38) $   (2.20)
Loss per common share -
 Basic / Diluted             (.38)     (.45)    (1.43)     (.38)     (2.20)
Weighted average common
 shares outstanding -
 Basic / Diluted           94,390    94,219    49,771    48,794     48,324
UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheet
(in thousands, except share and per   March 31,   December 31,  March 31,
  share data)                           2010         2009         2009
                                     -----------  ------------ -----------
                                     (unaudited)   (audited)   (unaudited)
ASSETS
  Cash and due from banks            $   105,613  $    126,265 $   103,707
  Interest-bearing deposits in
   banks                                  99,893       120,382       5,792
  Federal funds sold, commercial
   paper and short-term investments      183,049       129,720      24,983
                                     -----------  ------------ -----------
    Cash and cash equivalents            388,555       376,367     134,482
  Securities available for sale        1,526,589     1,530,047   1,719,033
  Mortgage loans held for sale            21,998        30,226      43,161
  Loans, net of unearned income
   (including $72,889 held for sale
   at March 31, 2010)                  4,992,045     5,151,476   5,632,705
    Less allowance for loan
     losses                              173,934       155,602     143,990
                                     -----------  ------------ -----------
      Loans, net                       4,818,111     4,995,874   5,488,715
  Assets covered by loss sharing
   agreements with the FDIC              169,287       185,938           -
  Premises and equipment, net            181,217       182,038     178,980
  Accrued interest receivable             30,492        33,867      45,514
  Goodwill and other intangible
   assets                                224,394       225,196     251,060
  Foreclosed property                    136,275       120,770      75,383
  Other assets                           340,100       319,591     235,335
                                     -----------  ------------ -----------
    Total assets                     $ 7,837,018  $  7,999,914 $ 8,171,663
                                     ===========  ============ ===========
LIABILITIES AND SHAREHOLDERS'
  EQUITY
Liabilities:
  Deposits:
    Demand                           $   740,727  $    707,826 $   665,447
    NOW                                1,344,973     1,335,790   1,284,791
    Money market                         729,283       713,901     500,261
    Savings                              186,699       177,427     177,001
    Time:
      Less than $100,000               1,643,059     1,746,511   1,911,627
      Greater than $100,000            1,132,034     1,187,499   1,350,190
      Brokered                           710,813       758,880     727,171
                                     -----------  ------------ -----------
        Total deposits                 6,487,588     6,627,834   6,616,488
  Federal funds purchased,
   repurchase agreements, and
   other short-term borrowings           102,480       101,389     158,690
  Federal Home Loan Bank advances        114,303       114,501     260,125
  Long-term debt                         150,086       150,066     151,006
  Accrued expenses and other
   liabilities                            56,666        43,803      96,501
                                     -----------  ------------ -----------
    Total liabilities                  6,911,123     7,037,593   7,282,810
                                     -----------  ------------ -----------
Shareholders' equity:
  Preferred stock, $1 par value;
   10,000,000 shares authorized;
    Series A; $10 stated
     value; 21,700, 21,700 and
     25,800 shares issued and
     outstanding                             217           217         258
    Series B; $1,000 stated value;
     180,000 shares issued and
     outstanding                         174,727       174,408     173,480
  Common stock, $1 par value;
   100,000,000 shares authorized;
   94,175,857, 94,045,603 and
   48,809,301 shares issued               94,176        94,046      48,809
  Common stock issuable; 262,002,
   221,906 and 161,807 shares              4,127         3,597       3,270
  Capital surplus                        622,803       622,034     452,277
  Retained earnings (accumulated
   deficit)                              (15,481)       20,384     158,201
  Treasury stock; 322,603 shares,
   at cost                                     -             -      (5,992)
  Accumulated other comprehensive
   income                                 45,326        47,635      58,550
                                     -----------  ------------ -----------
    Total shareholders' equity           925,895       962,321     888,853
                                     -----------  ------------ -----------
    Total liabilities and
     shareholders' equity            $ 7,837,018  $  7,999,914 $ 8,171,663
                                     ===========  ============ ===========
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended March 31,
                                                       2010
                                        ----------  ----------- ----------
(dollars in thousands, taxable            Average                  Avg.
 equivalent)                              Balance    Interest      Rate
                                        ----------  ----------- ----------
Assets:
Interest-earning assets:
  Loans, net of unearned income (1)(2)  $5,172,847  $    72,219       5.66%
  Taxable securities (3)                 1,487,646       15,892       4.27
  Tax-exempt securities (1)(3)              30,050          509       6.78
  Federal funds sold and other
   interest-earning assets                 394,348        1,229       1.25
                                        ----------  -----------
     Total interest-earning assets       7,084,891       89,849       5.13
                                        ----------  -----------
Non-interest-earning assets:
  Allowance for loan losses               (187,288)
  Cash and due from banks                  104,545
  Premises and equipment                   181,927
  Other assets (3)                         762,228
                                        ----------
     Total assets                       $7,946,303
                                        ==========
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
  Interest-bearing deposits:
   NOW                                  $1,361,696  $     1,854        .55
   Money market                            723,470        1,757        .98
   Savings                                 180,448           84        .19
   Time less than $100,000               1,692,652        8,891       2.13
   Time greater than $100,000            1,155,776        6,770       2.38
   Brokered                                736,999        4,537       2.50
                                        ----------  -----------
    Total interest-bearing deposits      5,851,041       23,893       1.66
                                        ----------  -----------
   Federal funds purchased and other
    borrowings                             102,058        1,038       4.12
   Federal Home Loan Bank advances         114,388          977       3.46
   Long-term debt                          150,078        2,662       7.19
                                        ----------  -----------
     Total borrowed funds                  366,524        4,677       5.18
                                        ----------  -----------
     Total interest-bearing
      liabilities                        6,217,565       28,570       1.86
                                                    -----------
Non-interest-bearing liabilities:
  Non-interest-bearing deposits            718,975
  Other liabilities                         64,337
                                        ----------
    Total liabilities                    7,000,877
Shareholders' equity                       945,426
                                        ----------
    Total liabilities and
     shareholders' equity               $7,946,303
                                        ==========
Net interest revenue                                $    61,279
                                                    ===========
Net interest-rate spread                                              3.27%
                                                                ==========
Net interest margin (4)                                               3.49%
                                                                ==========
(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 $43.2 million and $10.6 million in 2010 and 2009,
     respectively, 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 March 31,
                                                       2009
                                        ----------  ----------- ----------
(dollars in thousands, taxable            Average                  Avg.
 equivalent)                              Balance    Interest      Rate
                                        ----------  ----------- ----------
Assets:
Interest-earning assets:
  Loans, net of unearned income (1)(2)  $5,675,054  $    81,749       5.84%
  Taxable securities (3)                 1,682,603       20,433       4.86
  Tax-exempt securities (1)(3)              30,051          522       6.95
  Federal funds sold and other
   interest-earning assets                 142,522          858       2.41
                                        ----------  -----------
     Total interest-earning assets       7,530,230      103,562       5.56
                                        ----------  -----------
Non-interest-earning assets:
  Allowance for loan losses               (128,798)
  Cash and due from banks                  104,411
  Premises and equipment                   179,495
  Other assets (3)                         686,943
                                        ----------
     Total assets                       $8,372,281
                                        ==========
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
  Interest-bearing deposits:
   NOW                                  $1,358,149  $     3,337       1.00
   Money market                            477,325        2,237       1.90
   Savings                                 172,708          127        .30
   Time less than $100,000               1,942,897       17,217       3.59
   Time greater than $100,000            1,393,188       12,825       3.73
   Brokered                                786,171        6,011       3.10
                                        ----------  -----------
     Total interest-bearing deposits     6,130,438       41,754       2.76
                                        ----------  -----------
   Federal funds purchased and other
    borrowings                             150,517          553       1.49
   Federal Home Loan Bank advances         204,941        1,074       2.13
   Long-term debt                          150,997        2,769       7.44
                                        ----------  -----------
     Total borrowed funds                  506,455        4,396       3.52
                                        ----------  -----------
     Total interest-bearing
      liabilities                        6,636,893       46,150       2.82
                                                    -----------
Non-interest-bearing liabilities:
  Non-interest-bearing deposits            650,093
  Other liabilities                        117,790
                                        ----------
    Total liabilities                    7,404,776
Shareholders' equity                       967,505
                                        ----------
    Total liabilities and
     shareholders' equity               $8,372,281
                                        ==========
Net interest revenue                                $    57,412
                                                    ===========
Net interest-rate spread                                              2.74%
                                                                ==========
Net interest margin (4)                                               3.08%
                                                                ==========
(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 $43.2 million and $10.6 million in 2010 and 2009,
     respectively, 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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