United Community Banks, Inc.
Apr 28, 2011

United Community Banks, Inc. Reports Net Operating Loss of $142.5 Million for First Quarter 2011

BLAIRSVILLE, GA -- (MARKET WIRE) -- 04/28/11 -- United Community Banks, Inc. (NASDAQ: UCBI)


--  Completed strategically significant $380 million private equity

    offering

--  Executed major elements of our asset disposition plan to de-risk

    balance sheet:

    --  completed $267 million bulk loan sale on April 18

    --  sold $77.5 million in loans and foreclosed properties

    --  aggressively wrote down foreclosed properties to 30 percent of

        unpaid principal balance

--  Nonperforming assets down 57 percent from prior quarter and at lowest

    level in three years

--  Allowance for loan losses remains strong at 3.17 percent of loans

--  Core transaction deposits up 13 percent on an annualized basis

United Community Banks, Inc. (NASDAQ: UCBI) today reported a net operating loss from continuing operations of $142.5 million, or $1.57 per diluted share, for the first quarter of 2011. The higher net operating loss reflects the board of directors' decision to adopt an aggressive asset disposition plan to quickly sell and write down problem assets following United's private equity offering.

"The asset disposition plan includes bulk sales of classified loans, as well as aggressive write-downs of foreclosed properties to levels significantly less than the appraised values in order to accelerate their sales," stated Jimmy Tallent, president and chief executive officer. "The completion of the $380 million offering and the execution of our asset disposition plan are key accomplishments toward our goal of achieving sustained profitability beginning in the second quarter of 2011."

The accelerated disposition of classified loans through bulk sales and transfers to foreclosed properties represented $211.1 million of the $231.6 million in net charge-offs for the first quarter. The bulk loan sale included performing substandard loans of $166.1 million and nonperforming loans of $100.5 million. These classified loans were written down in the first quarter to the expected sales proceeds of $80.6 million, resulting in loan charge-offs of $186.0 million. The bulk loan sale transaction was completed on April 18, 2011.

Additionally, United sold $20.9 million in other classified loans and transferred $32.6 million in nonperforming loans to foreclosed properties during the first quarter resulting in additional loan charge-offs of $25.1 million. Remaining net charge-offs of $20.5 million for the quarter were due to the inflow of nonperforming loans and other activities. These actions reduced nonperforming loans to $83.8 million at quarter-end, down from $179.1 million at the end of the fourth quarter of 2010 and from $280.8 million a year ago.

"The first quarter provision for loan losses and net charge-offs -- $190 million and $231.6 million, respectively -- are significantly higher than prior quarters and reflect the execution of our asset disposition plan," said Tallent. "We reduced the allowance for loan losses to $133.1 million, or 3.17 percent of loans -- which remains at a prudent and conservative level."

Execution of the asset disposition plan also included the sale of $56.6 million in foreclosed properties during the first quarter at a loss of $12.0 million, and a $48.6 million write-down of remaining foreclosed properties to accelerate their dispositions. At March 31, 2011, foreclosed properties were $54.4 million and were written down well below appraised values to 30 percent of their original unpaid principal balance.

Total non-performing assets were $138 million at quarter-end, compared with $321 million at December 31, 2010 and $417 million at March 31, 2010; reflecting the lowest level since March 31, 2008.

"We made tremendous progress during the first quarter toward our goal of returning to profitability," stated Jimmy Tallent. "With classified assets at a more manageable level, we can turn our focus toward other activities. The economy and the real estate market remain weak so we will move forward cautiously, but with a renewed sense of optimism. I am excited about the opportunities that lie ahead for us."

Total loans were $4.2 billion at quarter-end, down $410 million from the prior quarter-end and down $798 million from a year ago, reflecting the higher level of net charge-offs resulting from the transfer of the bulk sale loans to the loans held-for-sale category. Residential construction loans were $550 million, or 13 percent of total loans, down $145 million from the prior quarter-end and down $410 million from a year ago. The decline during the first quarter was partially offset by $52.6 million in new customer loans, primarily commercial and small business lending in north Georgia and metropolitan Atlanta.

Taxable equivalent net interest revenue of $56.4 million was $4.9 million lower than the first quarter of 2010, primarily due to the $574 million reduction in average loan balances. Also contributing to lower net interest revenue in the first quarter was the reversal of $2.0 million in interest on performing classified loans that were included in the bulk sale transaction. The net interest margin was 3.30 percent for the first quarter of 2011, down 19 basis points from a year ago and down 28 basis points from the fourth quarter of 2010. Interest reversals on the performing classified loans that were included in the bulk loan sale accounted for 11 basis points of the decrease. In addition, maintenance of higher levels of liquidity further lowered first quarter net interest margin by 49 basis points. This compares to 30 basis points in the fourth quarter of 2010 and 18 basis points for the first quarter of 2010.

Tallent credited United bankers for their focus on servicing customers and growing the franchise while management worked out the capital transaction and asset disposition plan. "We grew core transaction deposits in the first quarter by $89 million, or 13 percent on an annualized basis," Tallent said. "This was due in part to a core deposit marketing initiative that we launched in 2009 and that focuses on our strong customer service culture. I have been extremely pleased with the impact it has had on deposit growth and cross-selling activities this past year. Core transaction deposits are the lifeblood of this company, and this was their ninth consecutive quarter of growth. Since the beginning of 2009, we have grown core transaction deposits by $638 million, and that is nothing short of phenomenal."

Operating fee revenue was $11.8 million in the first quarter of 2011, compared to $11.7 million a year ago. Service charges and fees were $6.7 million, down $727,000 from a year ago, due primarily to lower overdraft fees resulting from recent regulatory changes that required customers to provide consent before using overdraft services. Other fee revenue of $2.9 million reflected an increase of $780,000 from a year ago due to the acceleration of deferred gains relating to the ineffectiveness of terminated cash flow hedges on certain prime-based loans.

First quarter operating expenses were $115.3 million, up $60.5 million from a year ago. The increase was due primarily to the asset disposition plan, the $60.6 million of write-downs and losses on foreclosed properties, and the $3.6 million in associated costs for property taxes and professional fees related to the bulk loan sale and private equity offering. Excluding these costs from both periods, operating expenses for the first quarter totaled $51.1 million compared to $46.7 million a year ago. Salary and benefit costs totaled $24.9 million and increased $564,000 from last year due primarily to higher health insurance costs. Professional fees of $3.3 million were $1.4 million higher than a year ago, reflecting the $1.0 million for transaction costs in the first quarter of 2011 and higher credit-related workout costs. FDIC assessments and other regulatory charges of $5.4 million reflected an increase of $1.8 million from a year ago as a result of a higher deposit insurance assessment rate and an increase in the level of insured deposits. Other operating expenses of $6.4 million were $2.5 million more than a year ago due to the $2.6 million of property taxes incurred this quarter in connection with the bulk loan sale transaction.

Foreclosed property costs for the first quarter of 2011 were $64.9 million as compared to $10.8 million a year ago. For 2011, these costs included $60.6 million for write-downs and losses on sales and $4.3 million for maintenance and other foreclosed property costs. For 2010, write-downs and losses on sales were $8.1 million while maintenance costs were $2.7 million. Included in write-downs and losses for the first quarter of 2011 were $48.6 million of mark-downs on foreclosed properties to expedite sales and $12.0 million of losses related to the $56.6 million in sales of foreclosed properties during the first quarter.

The effective tax rate for the first quarter of 2011 was 40 percent, equal to the first quarter of 2010. The effective tax rate for the balance of 2011 is expected to return to a normal range of 35 to 36 percent; however, this rate could vary significantly depending on the level of earnings.

As of March 31, 2011, the capital ratios for United were as follows: Tier 1 Risk Based of 7.8 percent; Tier 1 Leverage of 5.1 percent; and, Total Risk Based of 15.6 percent. The quarterly average tangible equity-to-assets ratio was 8.7 percent and the tangible common equity-to-assets ratio was 5.5 percent. The holding company regulatory capital ratios reflect limitations on the inclusion of certain capital elements in Tier 1 Capital which resulted in the exclusion of a significant portion of the cumulative preferred stock issued in the private equity offering. Upon shareholder approval, which is expected at our shareholders meeting in June, the new cumulative preferred stock will convert to common stock and will be fully included in Tier 1 Capital. Assuming conversion of the cumulative preferred stock, United's pro forma capital ratios as of March 31, 2011 would have been as follows: Tier 1 Risk Based of 13.2 percent; Tier 1 Leverage of 8.5 percent; Total Risk Based of 15.7 percent; and, tangible common equity-to-assets of 6.3 percent.

"The first quarter of 2011 marks a significant and dramatic turning point," Tallent said. "We're heading into the remainder of 2011 with strong capital and a healthy, de-risked balance sheet. The weak economy and high unemployment remain, but opportunities are beginning to surpass challenges, and that is something we have not been able to say in quite some time."

Conference Call

United Community Banks will hold a conference call today, Thursday, April 28, 2011, at 11 a.m. ET to discuss the contents of this news release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the password '56062275.' 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 $8.0 billion and operates 27 community banks with 106 banking offices throughout north Georgia, the Atlanta region, coastal Georgia, western North Carolina and east Tennessee. The Company specializes in providing personalized community banking services to individuals and small to mid-size businesses. United Community Banks also offers the convenience of 24-hour access through a network of ATMs, telephone and on-line banking. United Community Banks common stock is listed on the Nasdaq Global Select Market under the symbol UCBI. Additional information may be found at the Company's web site at www.ucbi.com.

Safe Harbor

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





UNITED COMMUNITY BANKS, INC.

Financial Highlights

Selected Financial Information





                      2011                         2010

                   ---------   ------------------------------------------

(in thousands,

 except per share

 data; taxable       First     Fourth      Third      Second      First

 equivalent)        Quarter    Quarter     Quarter    Quarter    Quarter

                   ---------   --------   ---------   --------   --------

INCOME SUMMARY

Interest revenue   $  75,965   $ 81,215   $  84,360   $ 87,699   $ 89,849

Interest expense      19,573     21,083      24,346     26,072     28,570

                   ---------   --------   ---------   --------   --------

    Net interest

     revenue          56,392     60,132      60,014     61,627     61,279

Operating

 provision for

 loan losses (1)     190,000     47,750      50,500     61,500     75,000

Operating fee

 revenue (2)          11,838     12,442      12,861     11,579     11,666

                   ---------   --------   ---------   --------   --------

   Total operating

    revenue (1)(2)  (121,770)    24,824      22,375     11,706     (2,055)

Operating expenses

 (3)                 115,271     64,918      64,906     58,308     54,820

Loss on sale of

 nonperforming

 assets                    -          -           -     45,349          -

                   ---------   --------   ---------   --------   --------

    Operating loss

     from continuing

     operations

     before taxes   (237,041)   (40,094)    (42,531)   (91,951)   (56,875)

Operating income

 tax benefit         (94,555)   (16,520)    (16,706)   (32,419)   (22,417)

                   ---------   --------   ---------   --------   --------

    Net operating

     loss from

     continuing

     operations

     (1)(2)(3)      (142,486)   (23,574)    (25,825)   (59,532)   (34,458)

Noncash goodwill

 impairment

 charges                   -          -    (210,590)         -          -

Partial reversal

 of fraud loss

 provision, net of

 tax expense               -      7,179           -          -          -

Loss from

 discontinued

 operations                -          -           -          -       (101)

Gain from sale of

 subsidiary, net

 of income taxes

 and selling costs         -          -           -          -      1,266

                   ---------   --------   ---------   --------   --------

    Net loss        (142,486)   (16,395)   (236,415)   (59,532)   (33,293)

Preferred

 dividends and

 discount

 accretion             2,778      2,586       2,581      2,577      2,572

                   ---------   --------   ---------   --------   --------

Net loss available

 to common

 shareholders      $(145,264)  $(18,981)  $(238,996)  $(62,109)  $(35,865)

                   =========   ========   =========   ========   ========

PERFORMANCE

 MEASURES

  Per common share:

    Diluted operating

     loss from

     continuing

     operations

     (1)(2)(3)     $   (1.57)  $   (.28)  $    (.30)  $   (.66)  $   (.39)

    Diluted loss

     from

     continuing

     operations        (1.57)      (.20)      (2.52)      (.66)      (.39)

    Diluted loss       (1.57)      (.20)      (2.52)      (.66)      (.38)

    Book value          2.96       4.84        5.14       7.71       7.95

    Tangible book

     value (5)          2.89       4.76        5.05       5.39       5.62

  Key performance

   ratios:

    Return on

     equity (4)(6)   (147.11)%   (17.16)%   (148.04)%   (35.89)%   (20.10)%

    Return on

     assets (6)        (7.61)      (.89)     (12.47)     (3.10)     (1.70)

    Net interest

     margin (6)         3.30       3.58        3.57       3.60       3.49

    Operating

     efficiency

     ratio from

     continuing

     operations

     (2)(3)           169.08      89.45       89.38     141.60      75.22

    Equity to

     assets             8.82       8.85       11.37      11.84      11.90

    Tangible

     equity to

     assets (5)         8.73       8.75        9.19       9.26       9.39

    Tangible

     common equity

     to assets (5)      5.51       6.35        6.78       6.91       7.13

    Tangible

     common equity

     to

     risk-weighted

     assets (5)         6.40       9.05        9.60       9.97      10.03

ASSET QUALITY *

  Non-performing

   loans           $  83,769   $179,094   $ 217,766   $224,335   $280,802

  Foreclosed

   properties         54,378    142,208     129,964    123,910    136,275

                   ---------   --------   ---------   --------   --------

    Total non-

     performing

     assets (NPAs)   138,147    321,302     347,730    348,245    417,077

  Allowance for

   loan losses       133,121    174,695     174,613    174,111    173,934

  Operating net

   charge-offs (1)   231,574     47,668      49,998     61,323     56,668

  Allowance for

   loan losses to

   loans                3.17%      3.79%       3.67%      3.57%      3.48%

  Operating net

   charge-offs to

   average loans

   (1)(6)              20.71       4.03        4.12       4.98       4.51

  NPAs to loans

   and foreclosed

   properties           3.25       6.77        7.11       6.97       8.13

  NPAs to total

   assets               1.73       4.32        4.96       4.55       5.32

AVERAGE BALANCES

 ($ in millions)

  Loans            $   4,599   $  4,768   $   4,896   $  5,011   $  5,173

  Investment

   securities          1,625      1,354       1,411      1,532      1,518

  Earning assets       6,902      6,680       6,676      6,854      7,085

  Total assets         7,595      7,338       7,522      7,704      7,946

  Deposits             6,560      6,294       6,257      6,375      6,570

  Shareholders'

   equity                670        649         855        912        945

  Common shares -

   basic

   (thousands)        92,330     94,918      94,679     94,524     94,390

  Common shares -

   diluted

   (thousands)        92,330     94,918      94,679     94,524     94,390

AT PERIOD END ($

 in millions)

  Loans *          $   4,194   $  4,604   $   4,760   $  4,873   $  4,992

  Investment

   securities          1,884      1,490       1,310      1,488      1,527

  Total assets         7,974      7,443       7,013      7,652      7,837

  Deposits             6,598      6,469       5,999      6,330      6,488

  Shareholders'

   equity                850        636         662        904        926

  Common shares

   outstanding

   (thousands)       104,516     94,685      94,433     94,281     94,176





(1) Excludes the partial reversal of a previously established provision

    for fraud-related loan losses of $11.8 million, net of tax expense of

    $4.6 million in the fourth quarter of 2010.  Operating charge-offs

    also exclude the $11.8 million related partial recovery of the

    previously charged off amount. (2)  Excludes revenue generated by

    discontinued operations in the first quarter of 2010.  (3)  Excludes

    the goodwill impairment charge of $211 million in the third quarter of

    2010 and expenses relating to discontinued operations in the first

    quarter of 2010.  (4)  Net loss available to common shareholders,

    which is net of preferred stock dividends, divided by average realized

    common equity, which excludes accumulated other comprehensive income

    (loss).  (5)  Excludes effect of acquisition related intangibles and

    associated amortization.  (6) Annualized.



* Excludes loans and foreclosed properties covered by loss sharing

  agreements with the FDIC.







UNITED COMMUNITY BANKS, INC.

Financial Highlights

Selected Financial Information



                                         2011         2010        First

                                     ----------   ----------     Quarter

(in thousands, except per share         First        First      2011-2010

data; taxable equivalent)              Quarter      Quarter      Change

                                     ----------   ----------   ----------

INCOME SUMMARY

Interest revenue                     $   75,965   $   89,849

Interest expense                         19,573       28,570

                                     ----------   ----------

    Net interest revenue                 56,392       61,279           (8)%

Operating provision for loan

 losses (1)                             190,000       75,000

Operating fee revenue (2)                11,838       11,666            1

                                     ----------   ----------

   Total operating revenue (1)(2)      (121,770)      (2,055)

Operating expenses (3)                  115,271       54,820          110

Loss on sale of nonperforming assets          -            -

                                     ----------   ----------

   Operating loss from continuing

    operations before taxes            (237,041)     (56,875)        (317)

Operating income tax benefit            (94,555)     (22,417)

                                     ----------   ----------

   Net operating loss from continuing

    operations (1)(2)(3)               (142,486)     (34,458)        (314)

Noncash goodwill impairment charges           -            -

Partial reversal of fraud loss

 provision, net of tax expense                -            -

Loss from discontinued operations             -         (101)

Gain from sale of subsidiary, net of

 income taxes and selling costs               -        1,266

                                     ----------   ----------

   Net loss                            (142,486)     (33,293)        (328)

Preferred dividends and discount

 accretion                                2,778        2,572

                                     ----------   ----------

Net loss available to common

 shareholders                        $ (145,264)  $  (35,865)

                                     ==========   ==========

PERFORMANCE MEASURES

  Per common share:

    Diluted operating loss from

     continuing operations (1)(2)(3) $    (1.57)  $     (.39)        (303)

    Diluted loss from continuing

     operations                           (1.57)        (.39)        (303)

    Diluted loss                          (1.57)        (.38)        (313)

    Book value                             2.96         7.95          (63)

    Tangible book value (5)                2.89         5.62          (49)

  Key performance ratios:

    Return on equity (4)(6)             (147.11)%     (20.10)%

    Return on assets (6)                  (7.61)       (1.70)

    Net interest margin (6)                3.30         3.49

    Operating efficiency ratio from

     continuing operations (2)(3)        169.08        75.22

    Equity to assets                       8.82        11.90

    Tangible equity to assets (5)          8.73         9.39

    Tangible common equity to assets

     (5)                                   5.51         7.13

    Tangible common equity to

     risk-weighted assets (5)              6.40        10.03

ASSET QUALITY *

  Non-performing loans               $   83,769   $  280,802

  Foreclosed properties                  54,378      136,275

                                     ----------   ----------

    Total non-performing assets

     (NPAs)                             138,147      417,077

  Allowance for loan losses             133,121      173,934

  Operating net charge-offs (1)         231,574       56,668

  Allowance for loan losses to loans       3.17%        3.48%

  Operating net charge-offs to

   average loans (1)(6)                   20.71         4.51

  NPAs to loans and foreclosed

   properties                              3.25         8.13

  NPAs to total assets                     1.73         5.32

AVERAGE BALANCES ($ in millions)

  Loans                              $    4,599   $    5,173          (11)

  Investment securities                   1,625        1,518            7

  Earning assets                          6,902        7,085           (3)

  Total assets                            7,595        7,946           (4)

  Deposits                                6,560        6,570            -

  Shareholders' equity                      670          945          (29)

  Common shares - basic (thousands)      92,330       94,390

  Common shares - diluted

   (thousands)                           92,330       94,390

AT PERIOD END ($ in millions)

  Loans *                            $    4,194   $    4,992          (16)

  Investment securities                   1,884        1,527           23

  Total assets                            7,974        7,837            2

  Deposits                                6,598        6,488            2

  Shareholders' equity                      850          926           (8)

  Common shares outstanding

   (thousands)                          104,516       94,176



(1) Excludes the partial reversal of a previously established provision

    for fraud-related loan losses of $11.8 million, net of tax expense of

    $4.6 million in the fourth quarter of 2010.  Operating charge-offs also

    exclude the $11.8 million related partial recovery of the previously

    charged off amount. (2)  Excludes revenue generated by discontinued

    operations in the first quarter of 2010.  (3)  Excludes the goodwill

    impairment charge of $211 million in the third quarter of 2010 and

    expenses relating to discontinued operations in the first quarter of

    2010.  (4)  Net loss available to common shareholders, which is net of

    preferred stock dividends, divided by average realized common equity,

    which excludes accumulated other comprehensive income (loss).

    (5)  Excludes effect of acquisition related intangibles and associated

    amortization.  (6) Annualized.



* Excludes loans and foreclosed properties covered by loss sharing

  agreements with the FDIC.









UNITED COMMUNITY BANKS, INC.

Operating Earnings to GAAP Earnings Reconciliation

Selected Financial Information



                      2011                         2010

                   ----------  -------------------------------------------

(in thousands,

 except per share

data; taxable        First      Fourth      Third      Second      First

 equivalent)         Quarter    Quarter     Quarter    Quarter    Quarter

                   ----------  ---------  ----------  ---------  ---------

Interest revenue

 reconciliation

Interest revenue -

 taxable

 equivalent        $   75,965  $  81,215  $   84,360  $  87,699  $  89,849

Taxable equivalent

 adjustment              (435)      (497)       (511)      (500)      (493)

                   ----------  ---------  ----------  ---------  ---------

    Interest

     revenue

     (GAAP)        $   75,530  $  80,718  $   83,849  $  87,199  $  89,356

                   ==========  =========  ==========  =========  =========

Net interest

 revenue

 reconciliation

Net interest

 revenue - taxable

 equivalent        $   56,392  $  60,132  $   60,014  $  61,627  $  61,279

Taxable equivalent

 adjustment              (435)      (497)       (511)      (500)      (493)

                   ----------  ---------  ----------  ---------  ---------

    Net interest

     revenue

     (GAAP)        $   55,957  $  59,635  $   59,503  $  61,127  $  60,786

                   ==========  =========  ==========  =========  =========

Provision for loan

 losses

 reconciliation

Operating

 provision for

 loan losses       $  190,000  $  47,750  $   50,500  $  61,500  $  75,000

Partial reversal

 of special

 fraud-related

 provision for

 loan loss                  -    (11,750)          -          -          -

                   ----------  ---------  ----------  ---------  ---------

    Provision for

     loan losses

     (GAAP)        $  190,000  $  36,000  $   50,500  $  61,500  $  75,000

                   ==========  =========  ==========  =========  =========

Total revenue

 reconciliation

Total operating

 revenue           $ (121,770) $  24,824  $   22,375  $  11,706  $  (2,055)

Taxable equivalent

 adjustment              (435)      (497)       (511)      (500)      (493)

Partial reversal

 of special

 fraud-related

 provision for

 loan loss                  -     11,750           -          -          -

                   ----------  ---------  ----------  ---------  ---------

    Total revenue

     (GAAP)        $ (122,205) $  36,077  $   21,864  $  11,206  $  (2,548)

                   ==========  =========  ==========  =========  =========

Expense

 reconciliation

Operating expense  $  115,271  $  64,918  $   64,906  $ 103,657  $  54,820

Noncash goodwill

 impairment charge          -          -     210,590          -          -

                   ----------  ---------  ----------  ---------  ---------

    Operating

     expense

     (GAAP)        $  115,271  $  64,918  $  275,496  $ 103,657  $  54,820

                   ==========  =========  ==========  =========  =========

Loss from

 continuing

 operations before

 taxes

 reconciliation

Operating loss

 from continuing

 operations before

 taxes             $ (237,041) $ (40,094) $  (42,531) $ (91,951) $ (56,875)

Taxable equivalent

 adjustment              (435)      (497)       (511)      (500)      (493)

Noncash goodwill

 impairment charge          -          -    (210,590)         -          -

Partial reversal

 of special

 fraud-related

 provision for

 loan loss                  -     11,750           -          -          -

                   ----------  ---------  ----------  ---------  ---------

    Loss from

     continuing

     operations

     before taxes

     (GAAP)        $ (237,476) $ (28,841) $ (253,632) $ (92,451) $ (57,368)

                   ==========  =========  ==========  =========  =========

Income tax benefit

 reconciliation

Operating income

 tax benefit       $  (94,555) $ (16,520) $  (16,706) $ (32,419) $ (22,417)

Taxable equivalent

 adjustment              (435)      (497)       (511)      (500)      (493)

Partial reversal

 of special

 fraud-related

 provision for

 loan loss                  -      4,571           -          -          -

                   ----------  ---------  ----------  ---------  ---------

    Income tax

     benefit

     (GAAP)        $  (94,990) $ (12,446) $  (17,217) $ (32,919) $ (22,910)

                   ==========  =========  ==========  =========  =========

Diluted loss from

 continuing

 operations per

 common share

 reconciliation

Diluted operating

 loss from

 continuing

 operations per

 common share      $    (1.57) $    (.28) $     (.30) $    (.66) $    (.39)

Noncash goodwill

 impairment charge          -          -       (2.22)         -          -

Partial reversal

 of special

 fraud-related

 provision for

 loan loss                  -        .08           -          -          -

                   ----------  ---------  ----------  ---------  ---------

    Diluted loss

     from continuing

     operations

     per common

     share (GAAP)  $    (1.57) $    (.20) $    (2.52) $    (.66) $    (.39)

                   ==========  =========  ==========  =========  =========

Book value per

 common share

 reconciliation

Tangible book

 value per common

 share             $     2.89  $    4.76  $     5.05  $    5.39  $    5.62

Effect of goodwill

 and other

 intangibles              .07        .08         .09       2.32       2.33

                   ----------  ---------  ----------  ---------  ---------

   Book value per

    common share

    (GAAP)         $     2.96  $    4.84  $     5.14  $    7.71  $    7.95

                   ==========  =========  ==========  =========  =========

Efficiency ratio

 from continuing

 operations

 reconciliation

Operating

 efficiency ratio

 from continuing

 operations            169.08%     89.45%      89.38%    141.60%     75.22%

Noncash goodwill

 impairment charge          -          -      290.00          -          -

                   ----------  ---------  ----------  ---------  ---------

    Efficiency

     ratio from

     continuing

     operations

     (GAAP)            169.08%     89.45%     379.38%    141.60%     75.22%

                   ==========  =========  ==========  =========  =========

Average equity to

 assets

 reconciliation

Tangible common

 equity to assets        5.51%      6.35%       6.78%      6.91%      7.13%

Effect of

 preferred equity        3.22       2.40        2.41       2.35       2.26

                   ----------  ---------  ----------  ---------  ---------

    Tangible

     equity to

     assets              8.73       8.75        9.19       9.26       9.39

Effect of goodwill

 and other

 intangibles              .09        .10        2.18       2.58       2.51

                   ----------  ---------  ----------  ---------  ---------

    Equity to

     assets (GAAP)       8.82%      8.85%      11.37%     11.84%     11.90%

                   ==========  =========  ==========  =========  =========

Actual tangible

 common equity to

 risk-weighted

 assets

 reconciliation

Tangible common

 equity to

 risk-weighted

 assets                  6.40%      9.05%       9.60%      9.97%     10.03%

Effect of other

 comprehensive

 income                  (.58)      (.62)       (.81)      (.87)      (.85)

Effect of deferred

 tax limitation         (5.10)     (3.34)      (2.94)     (2.47)     (1.75)

Effect of trust

 preferred               1.12       1.06        1.06       1.03       1.00

Effect of

 preferred equity        5.97       3.52        3.51       3.41       3.29

                   ----------  ---------  ----------  ---------  ---------

    Tier I capital

     ratio

     (Regulatory)        7.81%      9.67%      10.42%     11.07%     11.72%

                   ==========  =========  ==========  =========  =========

Net charge-offs

 reconciliation

Operating net

 charge-offs       $  231,574  $  47,668  $   49,998  $  61,323  $  56,668

Subsequent partial

 recovery of

 fraud-related

 charge-off                 -    (11,750)          -          -          -

                   ----------  ---------  ----------  ---------  ---------

    Net charge-offs

     (GAAP)        $  231,574  $  35,918  $   49,998  $  61,323  $  56,668

                   ==========  =========  ==========  =========  =========

Net charge-offs to

 average loans

 reconciliation

Operating net

 charge-offs to

 average loans          20.71%      4.03%       4.12%      4.98%      4.51%

Subsequent partial

 recovery of

 fraud-related

 charge-off                 -      (1.00)          -          -          -

                   ----------  ---------  ----------  ---------  ---------

    Net charge-offs

     to average

     loans (GAAP)       20.71%      3.03%       4.12%      4.98%      4.51%

                   ==========  =========  ==========  =========  =========







UNITED COMMUNITY BANKS, INC.

Financial Highlights

Loan Portfolio Composition at Period-End (1)



                                     2011                2010

                                    ------- -------------------------------

                                    First   Fourth  Third   Second  First

(in millions)                       Quarter Quarter Quarter Quarter Quarter

                                    ------- ------- ------- ------- -------

LOANS BY CATEGORY

Commercial (sec. by RE)             $ 1,692 $ 1,761 $ 1,781 $ 1,780 $ 1,765

Commercial construction                 213     297     310     342     357

Commercial & industrial                 431     441     456     441     381

                                    ------- ------- ------- ------- -------

     Total commercial                 2,336   2,499   2,547   2,563   2,503

Residential construction                550     695     764     820     960

Residential mortgage                  1,187   1,279   1,316   1,356   1,390

Consumer / installment                  121     131     133     134     139

                                    ------- ------- ------- ------- -------

     Total loans                    $ 4,194 $ 4,604 $ 4,760 $ 4,873 $ 4,992

                                    ======= ======= ======= ======= =======





LOANS BY MARKET

Atlanta MSA                         $ 1,179 $ 1,310 $ 1,365 $ 1,373 $ 1,404

Gainesville MSA                         282     312     316     343     372

North Georgia                         1,531   1,689   1,755   1,808   1,814

Western North Carolina                  640     702     719     738     756

Coastal Georgia                         312     335     345     356     388

East Tennessee                          250     256     260     255     258

                                    ------- ------- ------- ------- -------

     Total loans                    $ 4,194 $ 4,604 $ 4,760 $ 4,873 $ 4,992

                                    ======= ======= ======= ======= =======





RESIDENTIAL CONSTRUCTION

Dirt loans

   Acquisition & development        $   116 $   174 $   190 $   214 $   290

   Land loans                            69      99     104     110     124

   Lot loans                            228     275     303     311     321

                                    ------- ------- ------- ------- -------

      Total                             413     548     597     635     735

                                    ------- ------- ------- ------- -------



House loans

   Spec                                  88      97     109     125     153

   Sold                                  49      50      58      60      72

                                    ------- ------- ------- ------- -------

      Total                             137     147     167     185     225

                                    ------- ------- ------- ------- -------

Total residential construction      $   550 $   695 $   764 $   820 $   960

                                    ======= ======= ======= ======= =======





RESIDENTIAL CONSTRUCTION - ATLANTA MSA

Dirt loans

   Acquisition & development        $    22 $    30 $    34 $    40 $    66

   Land loans                            19      23      27      32      43

   Lot loans                             24      32      45      39      47

                                    ------- ------- ------- ------- -------

      Total                              65      85     106     111     156

                                    ------- ------- ------- ------- -------



House loans

   Spec                                  34      38      42      48      58

   Sold                                  11      10      11      10      14

                                    ------- ------- ------- ------- -------

      Total                              45      48      53      58      72

                                    ------- ------- ------- ------- -------

Total residential construction      $   110 $   133 $   159 $   169 $   228

                                    ======= ======= ======= ======= =======



(1) Excludes total loans of $63.3 million, $68.2 million, $75.2 million,

    $80.8 million and $79.5 million as of March 31, 2011, December 31,

    2010, September 30, 2010, June 30, 2010 and March 31, 2010,

    respectively, that are covered by the loss-sharing agreement with the

    FDIC, related to the acquisition of Southern Community Bank.







UNITED COMMUNITY BANKS, INC.

Financial Highlights

Loan Portfolio Composition at Period-End (1)



                                     2011        2010

                                    ------- ---------------

                                                                     Year

                                                            Linked   over

                                     First  Fourth   First  Quarter  Year

(in millions)                       Quarter Quarter Quarter Change  Change

                                    ------- ------- ------- ------  ------

LOANS BY CATEGORY

Commercial (sec. by RE)             $ 1,692 $ 1,761 $ 1,765 $  (69) $  (73)

Commercial construction                 213     297     357    (84)   (144)

Commercial & industrial                 431     441     381    (10)     50

                                    ------- ------- -------

     Total commercial                 2,336   2,499   2,503   (163)   (167)

Residential construction                550     695     960   (145)   (410)

Residential mortgage                  1,187   1,279   1,390    (92)   (203)

Consumer / installment                  121     131     139    (10)    (18)

                                    ------- ------- -------

     Total loans                    $ 4,194 $ 4,604 $ 4,992   (410)   (798)

                                    ======= ======= =======





LOANS BY MARKET

Atlanta MSA                         $ 1,179 $ 1,310 $ 1,404   (131)   (225)

Gainesville MSA                         282     312     372    (30)    (90)

North Georgia                         1,531   1,689   1,814   (158)   (283)

Western North Carolina                  640     702     756    (62)   (116)

Coastal Georgia                         312     335     388    (23)    (76)

East Tennessee                          250     256     258     (6)     (8)

                                    ------- ------- -------

     Total loans                    $ 4,194 $ 4,604 $ 4,992   (410)   (798)

                                    ======= ======= =======





RESIDENTIAL CONSTRUCTION

Dirt loans

   Acquisition & development        $   116 $   174 $   290    (58)   (174)

   Land loans                            69      99     124    (30)    (55)

   Lot loans                            228     275     321    (47)    (93)

                                    ------- ------- -------

      Total                             413     548     735   (135)   (322)

                                    ------- ------- -------



House loans

   Spec                                  88      97     153     (9)    (65)

   Sold                                  49      50      72     (1)    (23)

                                    ------- ------- -------

      Total                             137     147     225    (10)    (88)

                                    ------- ------- -------

Total residential construction      $   550 $   695 $   960   (145)   (410)

                                    ======= ======= =======





RESIDENTIAL CONSTRUCTION - ATLANTA MSA

Dirt loans

   Acquisition & development        $    22 $    30 $    66     (8)    (44)

   Land loans                            19      23      43     (4)    (24)

   Lot loans                             24      32      47     (8)    (23)

                                    ------- ------- -------

      Total                              65      85     156    (20)    (91)

                                    ------- ------- -------



House loans

   Spec                                  34      38      58     (4)    (24)

   Sold                                  11      10      14      1      (3)

                                    ------- ------- -------

      Total                              45      48      72     (3)    (27)

                                    ------- ------- -------

Total residential construction      $   110 $   133 $   228    (23)   (118)

                                    ======= ======= =======



(1) Excludes total loans of $63.3 million, $68.2 million, $75.2 million,

    $80.8 million and $79.5 million as of March 31, 2011, December 31,

    2010, September 30, 2010, June 30, 2010 and March 31, 2010,

    respectively, that are covered by the loss-sharing agreement with the

    FDIC, related to the acquisition of Southern Community Bank.







UNITED COMMUNITY BANKS, INC.

Financial Highlights

Credit Quality (1)

                                           First Quarter 2011 (2)

                                  ----------------------------------------

                                 Non-performing  Foreclosed       Total

(in thousands)                        Loans      Properties       NPAs

                                  ------------  ------------  ------------

NPAs BY CATEGORY

Commercial (sec. by RE)           $     20,648  $      7,886  $     28,534

Commercial construction                  3,701        11,568        15,269

Commercial & industrial                  2,198             -         2,198

                                  ------------  ------------  ------------

     Total commercial                   26,547        19,454        46,001

Residential construction                32,038        25,807        57,845

Residential mortgage                    23,711         9,117        32,828

Consumer / installment                   1,473             -         1,473

                                  ------------  ------------  ------------

     Total NPAs                   $     83,769  $     54,378  $    138,147

                                  ============  ============  ============

     Balance as a % of

      Unpaid Principal                    57.3%         30.3%         42.4%



NPAs BY MARKET

Atlanta MSA                       $     21,501  $     16,913  $     38,414

Gainesville MSA                          4,332         2,157         6,489

North Georgia                           30,214        23,094        53,308

Western North Carolina                  18,849         7,802        26,651

Coastal Georgia                          5,847         3,781         9,628

East Tennessee                           3,026           631         3,657

                                  ------------  ------------  ------------

     Total NPAs                   $     83,769  $     54,378  $    138,147

                                  ============  ============  ============





NPA ACTIVITY

Beginning Balance                 $    179,094  $    142,208  $    321,302

Loans placed on non-accrual             54,730             -        54,730

Payments received                       (3,550)            -        (3,550)

Loan charge-offs                       (43,969)            -       (43,969)

Foreclosures                           (17,052)       17,052             -

Capitalized costs                            -           270           270

Note / property sales                  (11,400)      (44,547)      (55,947)

Loans held for sale                    (74,084)            -       (74,084)

Write downs                                  -       (48,585)      (48,585)

Net losses on sales                          -       (12,020)      (12,020)

                                  ------------  ------------  ------------

     Ending Balance               $     83,769  $     54,378  $    138,147

                                  ============  ============  ============



(1) Excludes non-performing loans and foreclosed properties covered by the

    loss-sharing agreement with the FDIC, related to the acquisition of

    Southern Community Bank.

(2) The NPA activity shown for the first quarter of 2011 is presented with

    all activity related to loans transferred to the loans held for sale

    classification on one line as if those loans were transferred to held

    for sale at the beginning of the period.

(3) Includes charge-offs on loans related to United's previously announced

    asset disposition plan.  Such charge-offs severely distorted charge off

    rates for the first quarter of 2011.  A separate schedule has been

    included in this earnings release presenting the components of net

    charge-offs by loan category and geographic market for the first

    quarter of 2011.

(4) North Carolina residential construction net charge-offs for the fourth

    quarter of 2010 exclude a $11.8 million partial recovery of a 2007

    fraud-related charge-off.

(5) Annualized.









UNITED COMMUNITY BANKS, INC.

Financial Highlights

Credit Quality (1)

                                            Fourth Quarter 2010

                                  ----------------------------------------

                                 Non-performing  Foreclosed       Total

(in thousands)                        Loans      Properties       NPAs

                                  ------------  ------------  ------------

NPAs BY CATEGORY

Commercial (sec. by RE)           $     44,927  $     23,659  $     68,586

Commercial construction                 21,374        17,808        39,182

Commercial & industrial                  5,611             -         5,611

                                  ------------  ------------  ------------

     Total commercial                   71,912        41,467       113,379

Residential construction                54,505        78,231       132,736

Residential mortgage                    51,083        22,510        73,593

Consumer / installment                   1,594             -         1,594

                                  ------------  ------------  ------------

     Total NPAs                   $    179,094  $    142,208  $    321,302

                                  ============  ============  ============

     Balance as a % of

      Unpaid Principal                    67.2%         64.4%         65.9%



NPAs BY MARKET

Atlanta MSA                       $     48,289  $     41,154  $     89,443

Gainesville MSA                          5,171         9,273        14,444

North Georgia                           83,551        66,211       149,762

Western North Carolina                  25,832        11,553        37,385

Coastal Georgia                         11,145        11,901        23,046

East Tennessee                           5,106         2,116         7,222

                                  ------------  ------------  ------------

     Total NPAs                   $    179,094  $    142,208  $    321,302

                                  ============  ============  ============





NPA ACTIVITY

Beginning Balance                 $    217,766  $    129,964  $    347,730

Loans placed on non-accrual             81,023             -        81,023

Payments received                       (7,250)            -        (7,250)

Loan charge-offs                       (47,913)            -       (47,913)

Foreclosures                           (61,432)       61,432             -

Capitalized costs                            -           170           170

Note / property sales                   (3,100)      (33,509)      (36,609)

Loans held for sale                          -             -             -

Write downs                                  -        (8,031)       (8,031)

Net losses on sales                          -        (7,818)       (7,818)

                                  ------------  ------------  ------------

     Ending Balance               $    179,094  $    142,208  $    321,302

                                  ============  ============  ============



(1) Excludes non-performing loans and foreclosed properties covered by the

    loss-sharing agreement with the FDIC, related to the acquisition of

    Southern Community Bank.

(2) The NPA activity shown for the first quarter of 2011 is presented with

    all activity related to loans transferred to the loans held for sale

    classification on one line as if those loans were transferred to held

    for sale at the beginning of the period.

(3) Includes charge-offs on loans related to United's previously announced

    asset disposition plan.  Such charge-offs severely distorted charge off

    rates for the first quarter of 2011.  A separate schedule has been

    included in this earnings release presenting the components of net

    charge-offs by loan category and geographic market for the first

    quarter of 2011.

(4) North Carolina residential construction net charge-offs for the fourth

    quarter of 2010 exclude a $11.8 million partial recovery of a 2007

    fraud-related charge-off.

(5) Annualized.









UNITED COMMUNITY BANKS, INC.

Financial Highlights

Credit Quality (1)

                                             Third Quarter 2010

                                  ----------------------------------------

                                 Non-performing  Foreclosed       Total

(in thousands)                        Loans      Properties       NPAs

                                  ------------  ------------  ------------

NPAs BY CATEGORY

Commercial (sec. by RE)           $     53,646  $     14,838  $     68,484

Commercial construction                 17,279        15,125        32,404

Commercial & industrial                  7,670             -         7,670

                                  ------------  ------------  ------------

     Total commercial                   78,595        29,963       108,558

Residential construction                79,321        73,206       152,527

Residential mortgage                    58,107        26,795        84,902

Consumer / installment                   1,743             -         1,743

                                  ------------  ------------  ------------

     Total NPAs                   $    217,766  $    129,964  $    347,730

                                  ============  ============  ============

     Balance as a % of

      Unpaid Principal                    70.0%         65.9%         68.4%



NPAs BY MARKET

Atlanta MSA                       $     65,304  $     32,785  $     98,089

Gainesville MSA                         11,905         5,685        17,590

North Georgia                           92,295        67,439       159,734

Western North Carolina                  31,545        11,559        43,104

Coastal Georgia                         10,611        10,951        21,562

East Tennessee                           6,106         1,545         7,651

                                  ------------  ------------  ------------

     Total NPAs                   $    217,766  $    129,964  $    347,730

                                  ============  ============  ============





NPA ACTIVITY

Beginning Balance                 $    224,335  $    123,910  $    348,245

Loans placed on non-accrual            119,783             -       119,783

Payments received                      (11,469)            -       (11,469)

Loan charge-offs                       (52,647)            -       (52,647)

Foreclosures                           (59,844)       59,844             -

Capitalized costs                            -           601           601

Note / property sales                   (2,392)      (40,203)      (42,595)

Loans held for sale                          -             -             -

Write downs                                  -        (7,051)       (7,051)

Net losses on sales                          -        (7,137)       (7,137)

                                  ------------  ------------  ------------

     Ending Balance               $    217,766  $    129,964  $    347,730

                                  ============  ============  ============



(1) Excludes non-performing loans and foreclosed properties covered by the

    loss-sharing agreement with the FDIC, related to the acquisition of

    Southern Community Bank.

(2) The NPA activity shown for the first quarter of 2011 is presented with

    all activity related to loans transferred to the loans held for sale

    classification on one line as if those loans were transferred to held

    for sale at the beginning of the period.

(3) Includes charge-offs on loans related to United's previously announced

    asset disposition plan.  Such charge-offs severely distorted charge off

    rates for the first quarter of 2011.  A separate schedule has been

    included in this earnings release presenting the components of net

    charge-offs by loan category and geographic market for the first

    quarter of 2011.

(4) North Carolina residential construction net charge-offs for the fourth

    quarter of 2010 exclude a $11.8 million partial recovery of a 2007

    fraud-related charge-off.

(5) Annualized.









UNITED COMMUNITY BANKS, INC.

Financial Highlights

Credit Quality (1)





                        First Quarter    Fourth Quarter     Third Quarter

                          2011 (3)          2010 (4)            2010

                      ----------------- ----------------- -----------------

                                 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(5)   Offs   Loans(5)   Offs   Loans(5)

                      -------- -------  -------- -------  -------- -------

NET CHARGE-OFFS BY

 CATEGORY

Commercial (sec. by

 RE)                  $ 48,607   11.07% $  6,493    1.45% $ 14,212    3.16%

Commercial

 construction           49,715   76.95     3,924    5.12     1,972    2.40

Commercial &

 industrial              4,040    3.64     2,891    2.54     1,207    1.07

                      --------          --------          --------

   Total commercial    102,362   16.66    13,308    2.09    17,391    2.70

Residential

 construction           92,138   58.20    24,497   13.28    23,934   11.99

Residential mortgage    36,383   11.62     9,176    2.80     7,695    2.29

Consumer /

 installment               691    2.16       687    2.06       978    2.90

                      --------          --------          --------

   Total              $231,574   20.71  $ 47,668    4.03  $ 49,998    4.12

                      ========          ========          ========





NET CHARGE-OFFS BY

 MARKET

Atlanta MSA           $ 56,489   17.86% $ 15,222    4.48% $ 13,753    3.97%

Gainesville MSA          8,616   11.93     3,434    4.37     1,143    1.40

North Georgia          123,305   29.66    18,537    4.26    26,554    5.92

Western North

 Carolina               26,447   15.61     5,154    2.87     5,509    2.99

Coastal Georgia         12,003   14.80     3,670    4.27     2,702    3.05

East Tennessee           4,714    7.47     1,651    2.53       337     .52

                      --------          --------          --------

   Total              $231,574   20.71  $ 47,668    4.03  $ 49,998    4.12

                      ========          ========          ========



(1)  Excludes non-performing loans and foreclosed properties covered by the

loss-sharing agreement with the FDIC, related to the acquisition of

Southern Community Bank.

(2)  The NPA activity shown for the first quarter of 2011 is presented with

all activity related to loans transferred to the loans held for sale

classification on one line as if those loans were transferred to held for

sale at the beginning of the period.

(3)  Includes charge-offs on loans related to United's previously announced

asset disposition plan.  Such charge-offs severely distorted charge off

rates for the first quarter of 2011.  A separate schedule has been included

in this earnings release presenting the components of net charge-offs by

loan category and geographic market for the first quarter of 2011.

(4)  North Carolina residential construction net charge-offs for the fourth

quarter of 2010 exclude a $11.8 million partial recovery of a 2007

fraud-related charge-off.

(5)  Annualized.











UNITED COMMUNITY BANKS, INC.

Financial Highlights

Credit Quality - Net Charge-Offs First Quarter 2011 (1)



                            Asset Disposition Plan

                      -----------------------------------

                      Bulk Loan Sale (2)                            First

                      -----------------  Other   Fore-     Other   Quarter

                      Perform-   Non-    Bulk     closure   Net    2011 Net

                       ing    performing Loan    Charge-   Charge-  Charge-

(in thousands)         Loans    Loans    Sales(3) Offs(4)   Offs     Offs

                      -------- -------- -------- -------- -------- --------

NET CHARGE-OFFS BY

 CATEGORY

Commercial (sec. by

 RE)                  $ 29,451 $ 11,091 $  3,318 $  1,905 $  2,842 $ 48,607

Commercial

 construction           32,530   15,328      292      419    1,146   49,715

Commercial &

 industrial                365    2,303      859        -      513    4,040

                      -------- -------- -------- -------- -------- --------

   Total commercial     62,346   28,722    4,469    2,324    4,501  102,362

Residential

 construction           43,018   23,459    3,325   11,693   10,643   92,138

Residential mortgage    13,917   14,263    1,676    1,538    4,989   36,383

Consumer /

 installment                86      168       30       24      383      691

                      -------- -------- -------- -------- -------- --------

   Total              $119,367 $ 66,612 $  9,500 $ 15,579 $ 20,516 $231,574

                      ======== ======== ======== ======== ======== ========



NET CHARGE-OFFS BY

 MARKET

Atlanta MSA           $ 37,186 $  8,545 $  1,428 $  6,034 $  3,296 $ 56,489

Gainesville MSA          3,563    2,442      957      700      954    8,616

North Georgia           57,969   47,699    2,508    6,585    8,544  123,305

Western North

 Carolina               11,138    4,743    2,415    1,402    6,749   26,447

Coastal Georgia          6,835    2,180    2,013      634      341   12,003

East Tennessee           2,676    1,003      179      224      632    4,714

                      -------- -------- -------- -------- -------- --------

   Total              $119,367 $ 66,612 $  9,500 $ 15,579 $ 20,516 $231,574

                      ======== ======== ======== ======== ======== ========



(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)  Charge-offs totaling $186 million were recognized on the bulk loan

sale in the first quarter of 2011.  The loans were transferred to the loans

held for sale category in anticipation of the second quarter bulk loan sale

that was completed on April 18, 2011.

(3)  Losses on smaller bulk sale transactions completed during the first

quarter of 2011.

(4)  Loan charge-offs recognized in the first quarter of 2011 related to

loans transferred to foreclosed properties.  Such charge-offs were elevated

in the first quarter as a result of the asset disposition plan, which

called for aggressive write downs to expedite sales in the second and third

quarters of 2011.











UNITED COMMUNITY BANKS, INC.

Financial Highlights

Credit Quality - Bulk Loan Sale Summary (1)





                                                 Performing Loans

                                       ------------------------------------

                                        Carrying   Charge-Offs  Loans Held

(in thousands)                         Amount (2)      (3)      for Sale(4)

                                       ----------- ------------ -----------

BY CATEGORY

Commercial (sec. by RE)                $    40,902 $     29,451 $    11,451

Commercial construction                     45,490       32,530      12,960

Commercial & industrial                        504          365         139

                                       ----------- ------------ -----------

     Total commercial                       86,896       62,346      24,550

Residential construction                    59,747       43,018      16,729

Residential mortgage                        19,342       13,917       5,425

Consumer / installment                         120           86          34

                                       ----------- ------------ -----------

     Total                             $   166,105 $    119,367 $    46,738

                                       =========== ============ ===========

BY MARKET

Atlanta MSA                            $    51,647 $     37,186 $    14,461

Gainesville MSA                              4,949        3,563       1,386

North Georgia                               80,831       57,969      22,862

Western North Carolina                      15,468       11,138       4,330

Coastal Georgia                              9,493        6,835       2,658

East Tennessee                               3,717        2,676       1,041

                                       ----------- ------------ -----------

     Total                             $   166,105 $    119,367 $    46,738

                                       =========== ============ ===========



(1)  This schedule presents a summary of classified loans included in the

bulk loan sale transaction that closed on April 18, 2011.

(2)  This column represents the book value, or carrying amount, of the

loans prior to charge offs to mark loans to expected proceeds from sale.

(3)  This column represents the charge-offs required to adjust the loan

balances to the expected proceeds from the sale based on indicative bids

received from prospective buyers, including principal payments received or

committed advances made after the cutoff date through March 31, 2011 that

are part of the settlement.

(4)  This column represents the expected proceeds from the bulk sale based

on indicative bids received from prospective buyers and equals the balance

shown on the consolidated balance sheet as loans held for sale.











UNITED COMMUNITY BANKS, INC.

Financial Highlights

Credit Quality - Bulk Loan Sale Summary (1)



                                              Nonperforming Loans

                                      -------------------------------------

                                       Carrying   Charge-Offs   Loans Held

(in thousands)                        Amount (2)      (3)       for Sale(4)

                                      ----------- ------------- -----------

BY CATEGORY

Commercial (sec. by RE)               $    17,202 $      11,091 $     6,111

Commercial construction                    22,440        15,328       7,112

Commercial & industrial                     3,398         2,303       1,095

                                      ----------- ------------- -----------

     Total commercial                      43,040        28,722      14,318

Residential construction                   35,509        23,459      12,050

Residential mortgage                       21,717        14,263       7,454

Consumer / installment                        237           168          69

                                      ----------- ------------- -----------

     Total                            $   100,503 $      66,612 $    33,891

                                      =========== ============= ===========

BY MARKET

Atlanta MSA                           $    13,755 $       8,545 $     5,210

Gainesville MSA                             3,695         2,442       1,253

North Georgia                              70,901        47,699      23,202

Western North Carolina                      7,228         4,743       2,485

Coastal Georgia                             3,528         2,180       1,348

East Tennessee                              1,396         1,003         393

                                      ----------- ------------- -----------

     Total                            $   100,503 $      66,612 $    33,891

                                      =========== ============= ===========



(1)  This schedule presents a summary of classified loans included in the

bulk loan sale transaction that closed on April 18, 2011.

(2)  This column represents the book value, or carrying amount, of the

loans prior to charge offs to mark loans to expected proceeds from sale.

(3)  This column represents the charge-offs required to adjust the loan

balances to the expected proceeds from the sale based on indicative bids

received from prospective buyers, including principal payments received or

committed advances made after the cutoff date through March 31, 2011 that

are part of the settlement.

(4)  This column represents the expected proceeds from the bulk sale based

on indicative bids received from prospective buyers and equals the balance

shown on the consolidated balance sheet as loans held for sale.











UNITED COMMUNITY BANKS, INC.

Financial Highlights

Credit Quality - Bulk Loan Sale Summary (1)



                                                  Total Loans

                                      -------------------------------------

                                       Carrying    Charge-Offs  Loans Held

(in thousands)                        Amount (2)       (3)      for Sale(4)

                                      ----------- ------------- -----------

BY CATEGORY

Commercial (sec. by RE)               $    58,104 $      40,542 $    17,562

Commercial construction                    67,930        47,858      20,072

Commercial & industrial                     3,902         2,668       1,234

                                      ----------- ------------- -----------

     Total commercial                     129,936        91,068      38,868

Residential construction                   95,256        66,477      28,779

Residential mortgage                       41,059        28,180      12,879

Consumer / installment                        357           254         103

                                      ----------- ------------- -----------

     Total                            $   266,608 $     185,979 $    80,629

                                      =========== ============= ===========

BY MARKET

Atlanta MSA                           $    65,402 $      45,731 $    19,671

Gainesville MSA                             8,644         6,005       2,639

North Georgia                             151,732       105,668      46,064

Western North Carolina                     22,696        15,881       6,815

Coastal Georgia                            13,021         9,015       4,006

East Tennessee                              5,113         3,679       1,434

                                      ----------- ------------- -----------

     Total                            $   266,608 $     185,979 $    80,629

                                      =========== ============= ===========



(1)  This schedule presents a summary of classified loans included in the

bulk loan sale transaction that closed on April 18, 2011.

(2)  This column represents the book value, or carrying amount, of the

loans prior to charge offs to mark loans to expected proceeds from sale.

(3)  This column represents the charge-offs required to adjust the loan

balances to the expected proceeds from the sale based on indicative bids

received from prospective buyers, including principal payments received or

committed advances made after the cutoff date through March 31, 2011 that

are part of the settlement.

(4)  This column represents the expected proceeds from the bulk sale based

on indicative bids received from prospective buyers and equals the balance

shown on the consolidated balance sheet as loans held for sale.











UNITED COMMUNITY BANKS, INC.

Consolidated Statement of Income (Unaudited)



                                                       Three Months Ended

                                                            March 31,

                                                      --------------------

(in thousands, except per share data)                   2011       2010

                                                      ---------  ---------

Interest revenue:

 Loans, including fees                                $  61,107  $  72,215

 Investment securities, including tax exempt of $259

  and $311                                               13,604     16,203

 Federal funds sold, commercial paper and deposits in

  banks                                                     819        938

                                                      ---------  ---------

   Total interest revenue                                75,530     89,356

                                                      ---------  ---------

Interest expense:

 Deposits:

  NOW                                                     1,324      1,854

  Money market                                            2,028      1,757

  Savings                                                    77         84

  Time                                                   11,732     20,198

                                                      ---------  ---------

   Total deposit interest expense                        15,161     23,893

 Federal funds purchased, repurchase agreements and

  other short-term borrowings                             1,042      1,038

 Federal Home Loan Bank advances                            590        977

 Long-term debt                                           2,780      2,662

                                                      ---------  ---------

  Total interest expense                                 19,573     28,570

                                                      ---------  ---------

  Net interest revenue                                   55,957     60,786

 Provision for loan losses                              190,000     75,000

                                                      ---------  ---------

  Net interest revenue after provision for loan losses (134,043)   (14,214)

                                                      ---------  ---------

Fee revenue:

 Service charges and fees                                 6,720      7,447

 Mortgage loan and other related fees                     1,494      1,479

 Brokerage fees                                             677        567

 Securities gains, net                                       55         61

 Other                                                    2,892      2,112

                                                      ---------  ---------

  Total fee revenue                                      11,838     11,666

                                                      ---------  ---------

  Total revenue                                        (122,205)    (2,548)

                                                      ---------  ---------

Operating expenses:

 Salaries and employee benefits                          24,924     24,360

 Communications and equipment                             3,344      3,273

 Occupancy                                                4,074      3,814

 Advertising and public relations                           978      1,043

 Postage, printing and supplies                           1,118      1,225

 Professional fees                                        3,330      1,943

 Foreclosed property                                     64,899     10,813

 FDIC assessments and other regulatory charges            5,413      3,626

 Amortization of intangibles                                762        802

 Other                                                    6,429      3,921

                                                      ---------  ---------

  Total operating expenses                              115,271     54,820

                                                      ---------  ---------

 Loss from continuing operations before income taxes   (237,476)   (57,368)

 Income tax benefit                                     (94,990)   (22,910)

                                                      ---------  ---------

  Net loss from continuing operations                  (142,486)   (34,458)

 (Loss) income from discontinued operations, net

  of income taxes                                             -       (101)

 Gain from sale of subsidiary, net of income taxes

  and selling costs                                           -      1,266

                                                      ---------  ---------

  Net loss                                             (142,486)   (33,293)

 Preferred stock dividends and discount accretion         2,778      2,572

                                                      ---------  ---------

  Net loss available to common shareholders           $(145,264) $ (35,865)

                                                      =========  =========

Loss from continuing operations per common share -

 Basic / Diluted                                      $   (1.57) $    (.39)

Loss per common share - Basic / Diluted                   (1.57)      (.38)

Weighted average common shares outstanding - Basic /

 Diluted                                                 92,330     94,390











UNITED COMMUNITY BANKS, INC.

Consolidated Balance Sheet



(in thousands, except share and per

share data)

                                      March 31,   December 31,  March 31,

                                         2011         2010        2010

                                     -----------  -----------  -----------

                                     (unaudited)   (audited)   (unaudited)

 ASSETS

   Cash and due from banks           $   153,891  $    95,994  $   105,613

   Interest-bearing deposits in

    banks                                465,656      111,901       99,893

   Federal funds sold, commercial

    paper and short-term investments     470,087      441,562      183,049

                                     -----------  -----------  -----------

       Cash and cash equivalents       1,089,634      649,457      388,555

   Securities available for sale       1,638,494    1,224,417    1,526,589

   Securities held to maturity (fair

    value $248,361 and $267,988)         245,430      265,807            -

   Loans held for sale                    80,629            -            -

   Mortgage loans held for sale           25,364       35,908       21,998

   Loans, net of unearned income       4,194,372    4,604,126    4,992,045

        Less allowance for loan

         losses                          133,121      174,695      173,934

                                     -----------  -----------  -----------

               Loans, net              4,061,251    4,429,431    4,818,111

   Assets covered by loss sharing

    agreements with the FDIC             125,789      131,887      169,287

   Premises and equipment, net           179,143      178,239      181,217

   Accrued interest receivable            21,687       24,299       30,492

   Goodwill and other intangible

    assets                                10,684       11,446      224,394

   Foreclosed property                    54,378      142,208      136,275

   Net deferred tax asset                266,367      166,937       92,986

   Other assets                          174,742      183,160      247,114

                                     -----------  -----------  -----------

       Total assets                  $ 7,973,592  $ 7,443,196  $ 7,837,018

                                     ===========  ===========  ===========

 LIABILITIES AND SHAREHOLDERS'

  EQUITY

 Liabilities:

   Deposits:

        Demand                       $   864,708  $   793,414  $   740,727

        NOW                            1,320,136    1,424,781    1,344,973

        Money market                     967,938      891,252      729,283

        Savings                          193,591      183,894      186,699

        Time:

             Less than $100,000        1,576,505    1,496,700    1,643,059

             Greater than $100,000       990,289    1,002,359    1,132,034

             Brokered                    684,581      676,772      710,813

                                     -----------  -----------  -----------

                      Total deposits   6,597,748    6,469,172    6,487,588

    Federal funds purchased,

     repurchase agreements, and

     other short-term borrowings         102,107      101,067      102,480

    Federal Home Loan Bank advances       55,125       55,125      114,303

    Long-term debt                       150,166      150,146      150,086

    Unsettled securities purchases       177,532            -       17,588

    Accrued expenses and other

     liabilities                          40,766       32,171       39,078

                                     -----------  -----------  -----------

         Total liabilities             7,123,444    6,807,681    6,911,123

                                     -----------  -----------  -----------

 Shareholders' equity:

     Preferred stock, $1 par value;

      10,000,000 shares authorized;

          Series A; $10 stated

           value; 21,700 shares

           issued and outstanding            217          217          217

          Series B; $1,000 stated

           value; 180,000 shares

           issued and outstanding        176,049      175,711      174,727

          Series D; $1,000 stated

           value; 16,613 shares

           issued and outstanding         16,613            -            -

          Series F; $1,000 stated

           value; 195,872 shares

           issued and outstanding        195,872            -            -

          Series G; $1,000 stated

           value; 151,185 shares

           issued and outstanding        151,185            -            -

     Common stock, $1 par value;

      200,000,000 shares authorized;

      104,515,553, 94,685,003 and

      94,175,857 shares issued

      and outstanding                    104,516       94,685       94,176

     Common stock issuable; 397,138,

      336,437 and 262,002 shares           3,681        3,894        4,127

     Capital surplus                     655,350      665,496      622,803

     Accumulated deficit                (480,831)    (335,567)     (15,481)

     Accumulated other comprehensive

      income                              27,496       31,079       45,326

                                     -----------  -----------  -----------

         Total shareholders' equity      850,148      635,515      925,895

                                     -----------  -----------  -----------

         Total liabilities and

          shareholders' equity       $ 7,973,592  $ 7,443,196  $ 7,837,018

                                     ===========  ===========  ===========









UNITED COMMUNITY BANKS, INC.

Average Consolidated Balance Sheets and Net Interest Analysis

For the Three Months Ended March 31,



                                                             2011

                                                 -------------------------

                                                   Average            Avg.

(dollars in thousands, taxable equivalent)         Balance   Interest Rate

                                                 ----------  -------- ----

Assets:

Interest-earning assets:

  Loans, net of unearned income (1)(2)           $4,598,860  $ 61,070 5.39%

  Taxable securities (3)                          1,599,481    13,345 3.34

  Tax-exempt securities (1)(3)                       25,827       424 6.57

  Federal funds sold and other interest-earning

   assets                                           677,453     1,126  .66

                                                 ----------  --------

     Total interest-earning assets                6,901,621    75,965 4.45

                                                 ----------  --------

Non-interest-earning assets:

  Allowance for loan losses                        (169,113)

  Cash and due from banks                           134,341

  Premises and equipment                            179,353

  Other assets (3)                                  548,348

                                                 ----------

     Total assets                                $7,594,550

                                                 ==========

Liabilities and Shareholders' Equity:

Interest-bearing liabilities:

  Interest-bearing deposits:

    NOW                                         $1,373,142  $  1,324  .39

    Money market                                   928,542     2,028  .89

    Savings                                        187,423        77  .17

    Time less than $100,000                      1,540,342     5,451 1.44

    Time greater than $100,000                     990,881     4,151 1.70

    Brokered                                       698,288     2,130 1.24

                                                 ----------  --------

       Total interest-bearing deposits            5,718,618    15,161 1.08

                                                 ----------  --------

 Federal funds purchased and other borrowings       101,097     1,042 4.18

 Federal Home Loan Bank advances                     55,125       590 4.34

 Long-term debt                                     150,157     2,780 7.51

                                                 ----------  --------

      Total borrowed funds                          306,379     4,412 5.84

                                                 ----------  --------

      Total interest-bearing liabilities          6,024,997    19,573 1.32

                                                             --------

Non-interest-bearing liabilities:

  Non-interest-bearing deposits                     841,351

  Other liabilities                                  58,634

                                                 ----------

     Total liabilities                            6,924,982

Shareholders' equity                                669,568

                                                 ----------

     Total liabilities and shareholders' equity  $7,594,550

                                                 ==========

Net interest revenue                                         $ 56,392

                                                             ========

Net interest-rate spread                                              3.13%

                                                                      ====

Net interest margin (4)                                               3.30%

                                                                      ====



(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 and loans that are held

    for sale.

(3) Securities available for sale are shown at amortized cost.  Pretax

    unrealized gains of $27.2 million in 2011 and $43.2 million in 2010 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,



                                                              2010

                                                 -------------------------

                                                   Average            Avg.

(dollars in thousands, taxable 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 and loans that are held

    for sale.

(3) Securities available for sale are shown at amortized cost.  Pretax

    unrealized gains of $27.2 million in 2011 and $43.2 million in 2010 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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