United Community Banks, Inc.
Jan 20, 2016

United Community Banks, Inc. Reports Net Operating Income of $23.8 Million for Fourth Quarter 2015, up 30 Percent From a Year Ago

BLAIRSVILLE, Ga., Jan. 20, 2016 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NASDAQ:UCBI) ("United") today continued its strong momentum as it moves forward as a regional community bank in the Southeast, reflecting strong loan, core deposit and fee revenue growth, and a lower provision for credit losses.  For the fourth quarter of 2015, net operating income of $23.8 million increased 30 percent from a year ago and operating earnings per diluted share of 33 cents was up 10 percent from a year ago.

Operating earnings and operating earnings per diluted share for the fourth quarter of 2015 exclude the effects of merger-related and other charges for impairment on properties acquired for future expansion.  Including those charges, net income was $18.2 million for the fourth quarter, or 25 cents per diluted share.  Also, operating earnings this quarter include three months of earnings from the acquisition of The Palmetto Bank ("Palmetto"), as compared to one month for the third quarter of 2015.

For the full year of 2015, United achieved net income of $71.6 million, or $1.09 per diluted share.  Excluding merger-related and other charges, net operating income was $83.2 million, or $1.27 per diluted share.

At December 31, 2015, preliminary regulatory capital ratios were as follows: Tier 1 Risk-Based of 11.5 percent; Total Risk-Based of 12.5 percent; Common Equity Tier 1 Risk-Based of 11.5 percent; and, Tier 1 Leverage of 8.3 percent.

"United continues to enhance its long term value potential.  This past year of 2015 demonstrated the strengths of our footprint and the momentum that characterizes our organization as we enter into 2016," said Jimmy Tallent, chairman and chief executive officer.  "In 2015, we struck the proper balance of investing for our future and delivering strong financial results.  The fourth quarter was a continuation of that solid performance.

"Total loan production continued strong in the fourth quarter, though not readily apparent in our year-end loan balances due to the sale of our $190 million of healthcare loans," Tallent continued.  "Year-to-date loan growth, excluding loans acquired in mergers and our sale of healthcare loans, was $444 million, or 10 percent, slightly above our 2015 target of mid-to-upper-single-digit loan growth.  Our loan growth was funded with solid core transaction deposit growth of $524 million, or 14 percent, excluding mergers.

"Fourth quarter net loan growth of $162 million, excluding the healthcare loan sale, was driven by loan production of $590 million across all of our markets," added Tallent.  "Our community banks originated $360 million in loan production, while our specialized lending area, which includes asset-based, commercial real estate, middle market, SBA and builder finance lending, produced $157 million."

Fourth quarter taxable-equivalent net interest revenue totaled $74.0 million, up $8.33 million from the third quarter of 2015 and up $15.7 million from the fourth quarter of 2014.  The increase in net interest revenue reflects strong loan and core deposit growth, net interest revenue from the Palmetto and First National Bank acquisitions, and an increase in net interest margin.

"The taxable-equivalent net interest margin of 3.34 percent is an increase of eight basis points from the third quarter and up three basis points from a year ago," said Tallent.  "The increase from third quarter reflects higher yields on our loan and securities portfolios as well as a two basis point decrease in the average rate on our interest-bearing liabilities.

"This quarter, our loan yield, net interest margin and net interest revenue benefited from the discount accretion from the acquired loan portfolios.  The sale of our lower-yielding healthcare loans also contributed to the higher loan yield and net interest margin," commented Tallent.  "Additionally, the securities yield benefited from the mix of floating rate securities, slower prepayments and restructuring of a corporate bond, while interest-bearing liabilities benefited from Palmetto's highly desirable deposit base that provided a very low cost source of funds."

The fourth quarter provision for credit losses was $300 thousand, down $400 thousand from the third quarter and down $1.50 million from the fourth quarter of 2014.  Fourth quarter net charge-offs were $1.30 million compared with $1.42 million in the third quarter and $2.51 million a year ago.  Strong recoveries of previously charged-off loans drove net charge-offs down in the third and fourth quarters of 2015 compared with fourth quarter 2014.  Nonperforming assets were .29 percent of total assets at year-end, compared with .29 percent in the third quarter and .26 percent a year ago.

Fourth quarter fee revenue totaled $21.3 million, up $2.99 million from the third quarter and $6.46 million from the fourth quarter of 2014.  The increase from the third quarter was primarily due to the full quarter impact of the Palmetto acquisition.  Total service charges and fees were $11.5 million, up $2.17 million from the third quarter and up $3.05 million from a year ago.  Mortgage fees of $3.29 million were down $550 thousand from the third quarter and up $1.18 million from a year ago.  The decrease from the third quarter reflects seasonality and lower refinancing activity.  Closed mortgage loans totaled $138 million in the fourth quarter of 2015, compared with $141 million in the third quarter and $77.4 million in the fourth quarter of 2014.  During the fourth quarter, sales of $25.1 million in SBA loans resulted in net gains of $2.00 million.  This compares with $17.8 million in loans sold and net gains of $1.65 million in the third quarter of 2015, and $15.8 million in loans sold and net gains of $926 thousand in the fourth quarter of 2014.

"We are committed to growing our revenue stream by focusing on fee-generating products and services," stated Tallent.  "The growing SBA lending business and commitment to expanding our mortgage origination business are key parts of this strategy."

Operating expenses, excluding merger-related and other charges of $9.08 million, were $56.4 million in the fourth quarter.  This compares with $48.5 million in the third quarter of 2015 and $41.9 million in the fourth quarter of 2014.  The increase from the third quarter reflects approximately $5.6 million of operating expenses related to the full-quarter impact of the Palmetto acquisition.  Palmetto's operating expenses are expected to decline following systems conversions late in the first quarter in 2016, as anticipated cost savings are realized.

"The increase in operating expenses from third quarter also reflects higher professional fees and consulting services for several, mostly one-time, regulatory-related compliance projects throughout the company," stated Tallent.  "With the heightened sensitivity to compliance, we made a decision to accelerate these projects into the current year."

Fourth quarter salaries and employee benefits expense totaled $32.9 million, up $3.60 million from the third quarter and $6.35 million from a year ago.  The linked-quarter increase was primarily due to the full-quarter impact of Palmetto's costs, our new Charleston loan production office, and higher incentive costs associated with the growth in earnings and lending businesses.  The increase from a year ago reflects the impact of mergers, investment in new lenders and support staff for the specialized lending area, as well as higher commissions and incentives associated with the overall improvement in earnings and growth in the SBA and mortgage lending businesses, commercial loans and core deposits.

Occupancy expense of $4.67 million and communications and equipment expense of $4.74 million for the fourth quarter were up $653 thousand and $772 thousand, respectively, with the full-quarter of Palmetto's expenses accounting for most of the increase in both expense categories.

Other operating expenses for the fourth quarter totaled $7.01 million, up $1.46 million from the third quarter and up $3.08 million from the fourth quarter of 2014.  The linked-quarter increase is mostly due to the inclusion of Palmetto's operating expenses for the full-quarter versus one month in the third quarter.  The increase from last year is due to the acquisitions and higher transaction processing costs for interchange and internet banking services.

"Palmetto merged into United on September 1 and our team of bankers has been working diligently to bring these two great companies together," noted Tallent.  "System conversions are targeted for late February 2016 and, upon their completion, Palmetto branches will begin doing business under the United Community Bank brand."

Fourth quarter expenses included an after-tax merger charge of $1.94 million primarily related to severance and retention bonuses, system conversion costs, and advisory and professional services fees for the Palmetto acquisition.  United also incurred an after-tax non-operating impairment charge in the fourth quarter of $3.65 million to write-down properties acquired in prior years for future branch expansion.

"As part of our growth strategy, we are evaluating all of our delivery channels, including future branch sites," said Tallent.  "Some of these properties will be retained for future branch sites, others will be sold.  These decisions will be made over the next two years as we continue to execute on our growth strategies.  However, because we've held these properties for a long time, we evaluated them for impairment and wrote-down the properties accordingly."

"Our fourth quarter results mark the completion of another strong year," Tallent said. "We will remember 2015 as the year we successfully re-entered the mergers and acquisitions business.  I could not be more pleased with the partners we have chosen and our exceptional team of bankers who worked tirelessly to bring it all about.  I'm excited about the momentum and foundation we are building at United and the opportunities for growth and success they will bring."

Conference Call
United will hold a conference call today, Wednesday, January 20, 2016, at 11 a.m. ET to discuss the contents of this news release and to share business highlights for the quarter.  To access the call, dial (877) 380-5665 and use the conference number 19833202.  The conference call also will be webcast and available for replay for 30 days by selecting "Events & Presentations" within the Investor Relations section of United's website at www.ucbi.com.

About United Community Banks, Inc.
United Community Banks, Inc. (UCBI) is a bank holding company based in Blairsville, Georgia, with $9.6 billion in assets.  The company's banking subsidiary, United Community Bank, is one of the Southeast's largest full-service banks, operating 134 offices in Georgia, North Carolina, South Carolina and Tennessee.  The bank specializes in personalized community banking services for individuals, small businesses and corporations.  United Community Bank offers a full range of consumer and commercial banking services including mortgage, advisory, treasury management and other products.  In 2014 and 2015, United Community Bank was ranked first in customer satisfaction in the southeast by J.D. Power and again in 2016 was ranked among the top 100 on the Forbes list of America's Best Banks.  Additional information about the company and the bank's full range of products and services can be found at www.ucbi.com.

Safe Harbor
This news release contains forward-looking statements, as defined by federal securities laws, including statements about United's financial outlook and business environment.  These statements are based on current expectations and are provided to assist in the understanding of future financial performance.  Such performance involves risks and uncertainties that may cause actual results to differ materially from those expressed or implied in any such statements.  For a discussion of some of the risks and other factors that may cause such forward-looking statements to differ materially from actual results, please refer to United's filings with the Securities and Exchange Commission including its 2014 Annual Report on Form 10-K under the sections entitled "Forward-Looking Statements" and "Risk Factors."  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  
             
          Fourth 
  2015   2014 Quarter 
(in thousands, except per share Fourth   Third   Second   First   Fourth 2015-2014 
data; taxable equivalent)Quarter Quarter Quarter Quarter Quarter Change 
INCOME SUMMARY            
Interest revenue$  79,646  $  71,120  $  66,134  $  62,909  $  64,353    
Interest expense   5,598     5,402     4,817     5,292      6,021    
Net interest revenue   74,048     65,718     61,317     57,617     58,332    27 % 
Provision for credit losses   300     700     900     1,800     1,800    
Fee revenue   21,284     18,297     17,266     15,682     14,823    44   
Total revenue   95,032     83,315     77,683     71,499     71,355    33   
Expenses - operating  (1)   56,410     48,525     45,247     43,061     41,919    35   
Income before income tax expense - operating (1)   38,622     34,790     32,436     28,438     29,436    31   
Income tax expense - operating  (1)   14,822     13,064     12,447     10,768     11,189    32   
Net income - operating  (1)   23,800     21,726     19,989     17,670     18,247    30   
Preferred dividends and discount accretion   25     25     17      -      -     
Net income available to common
  shareholders - operating   (1)
   23,775     21,701     19,972     17,670     18,247    30   
Merger-related and other charges, net of income tax benefit   5,592     3,839     2,176      -      -     
Net income available to common
  shareholders - GAAP
$  18,183  $  17,862  $  17,796  $  17,670  $  18,247    -    
                         
PERFORMANCE MEASURES                        
  Per common share:                         
  Diluted income - operating  (1) $  .33    $.33  $.32  $.29  $.30    10   
  Diluted income - GAAP .25    .27   .28   .29   .30    (17)  
  Cash dividends declared .06   .06   .05   .05   .05    
  Book value   14.02     13.95     12.95     12.58     12.20    15   
  Tangible book value (3)   12.06     12.08     12.66     12.53     12.15    (1)  
                         
  Key performance ratios:                        
  Return on tangible common equity - operating (1)(2)(3)(4)   10.87 %   10.29 %   10.20 %   9.46 %   9.74 %   
  Return on common equity - operating (1)(2)(4)   9.18     9.54     9.90     9.34     9.60     
  Return on common equity - GAAP (2)(4)   7.02     7.85     8.83     9.34     9.60    
  Return on assets - operating (1)(4) .99     1.00     1.00   .94    .96    
  Return on assets - GAAP (4) .76   .82   .89   .94   .96    
  Dividend payout ratio - operating (1)   18.18     18.18     15.63     17.24     16.67    
  Dividend payout ratio - GAAP   24.00     22.22     17.86     17.24     16.67    
  Net interest margin (4)   3.34     3.26     3.30     3.31     3.31    
  Efficiency ratio - operating  (1)   59.41     57.81     57.59     59.15     57.47    
  Efficiency ratio - GAAP   68.97     64.65     61.63     59.15     57.47    
  Average equity to average assets 10.68   10.39   10.05   9.86   9.76    
  Average tangible equity to average assets (3) 9.40   9.88   9.91   9.82   9.72    
  Average tangible common equity to
  average assets (3)
 9.29    9.77   9.83   9.82   9.72    
  Tangible common equity to risk-weighted
  assets (3)(5)(6)
 12.82   13.08   13.24   13.53   13.82    
                          
ASSET QUALITY                         
  Nonperforming loans$  22,653  $  20,064  $  18,805  $  19,015  $  17,881    27   
  Foreclosed properties    4,883     7,669     2,356     1,158     1,726    183   
  Total nonperforming assets (NPAs)   27,536     27,733     21,161     20,173     19,607    40   
  Allowance for loan losses   68,448     69,062     70,129     70,007     71,619    (4)  
  Net charge-offs   1,302     1,417     978     2,562     2,509    (48)  
  Allowance for loan losses to loans 1.14 % 1.15 % 1.36 % 1.46 % 1.53   
  Allowance for loan losses to loans, excl. acquired loans 1.35    1.37   1.42   1.46   1.53    
  Net charge-offs to average loans (4) .09   .10   .08   .22   .22    
  NPAs to loans and foreclosed properties .46   .46   .41   .42   .42    
  NPAs to total assets .29   .29   .26   .26   .26    
                         
AVERAGE BALANCES ($ in millions)                        
  Loans$  5,975  $  5,457  $  5,017  $  4,725  $  4,621    29   
  Investment securities   2,607     2,396     2,261     2,203     2,222    17   
  Earning assets   8,792     8,009     7,444     7,070     7,013    25   
  Total assets   9,558     8,634     8,017     7,617     7,565    26   
  Deposits   8,028     7,135     6,669     6,369     6,383    26   
  Shareholders' equity   1,021     897     806     751     738    38   
  Common shares - basic (thousands)   72,135     66,294     62,549     60,905     60,830    19   
  Common shares - diluted (thousands)   72,140     66,300     62,553     60,909     60,833    19   
                         
AT PERIOD END ($ in millions)                         
  Loans$  5,995  $  6,024  $  5,174  $  4,788  $  4,672    28   
  Investment securities   2,656     2,457     2,322     2,201     2,198    21   
  Total assets   9,626     9,414     8,246     7,664     7,567    27   
  Deposits   7,881     7,905     6,808     6,438     6,327    25   
  Shareholders' equity   1,018     1,013     827     764     740    38   
  Common shares outstanding (thousands)   71,484     71,472     62,700     60,309     60,259    19   
             
(1)  Excludes merger-related charges and impairment losses on surplus bank property.  (2)  Net income available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss).  (3)  Excludes effect of acquisition related intangibles and associated amortization.  (4)  Annualized.  (5) December 31, September 30, June 30 and March 31, 2015 calculated under Basel III rules, which became effective January 1, 2015(6)  Fourth quarter 2015 ratio is preliminary. 
             

 

UNITED COMMUNITY BANKS, INC.  
Financial Highlights  
Selected Financial Information  
        
 For the Twelve   
 Months Ended YTD 
(in thousands, except per shareDecember 31, 2015-2014 
data; taxable equivalent)  2015   2014   Change 
INCOME SUMMARY       
Interest revenue$  279,809  $  249,969     
Interest expense   21,109     25,551     
Net interest revenue   258,700     224,418     15 % 
Provision for credit losses   3,700     8,500     
Fee revenue   72,529     55,554     31   
Total revenue   327,529     271,472     21   
Expenses - operating  (1)   193,243     162,865     19   
Income before income tax expense - operating (1)   134,286     108,607     24   
Income tax expense - operating  (1)   51,101     40,987     25   
Net income - operating  (1)   83,185     67,620     23   
Preferred dividends and discount accretion   67     439     
Net income available to common
  shareholders - operating  (1)
   83,118     67,181     24   
Merger-related and other charges, net of income tax benefit   11,607     -      
Net income available to common
  shareholders - GAAP
$  71,511  $  67,181     6   
              
PERFORMANCE MEASURES              
Per common share:             
Diluted income - operating  (1)$  1.27  $  1.11     14   
Diluted income - GAAP   1.09     1.11     (2)  
Cash dividends declared .22   .11       
Book value   14.02     12.20     15   
Tangible book value (3)   12.06      12.15     (1)  
        
Key performance ratios:       
Return on tangible common equity - operating (1)(2)(3)(4)   10.24 %   9.32 %     
Return on common equity - operating (1)(2)(4)   9.48     9.17     
Return on common equity - GAAP (2)(4)   8.15     9.17     
Return on assets - operating (1)(4) .98   .91       
Return on assets - GAAP (4) .85   .91       
Dividend payout ratio - operating (1)   17.32     9.91     
Dividend payout ratio - GAAP   20.18     9.91     
Net interest margin (4)   3.30     3.26     
Efficiency ratio - operating  (1)    58.51     58.26      
Efficiency ratio - GAAP   63.96     58.26     
Average equity to average assets 10.27   9.69     
Average tangible equity to average assets (3) 9.74   9.67     
Average tangible common equity to
  average assets (3)
 9.66   9.60     
Tangible common equity to risk-weighted
  assets (3)(5)(6)
   12.82    13.82     
              
ASSET QUALITY              
Nonperforming loans$  22,653  $  17,881     27   
Foreclosed properties   4,883     1,726     183   
Total nonperforming assets (NPAs)   27,536     19,607     40   
Allowance for loan losses   68,448     71,619     (4)  
Net charge-offs   6,259     13,878     (55)  
Allowance for loan losses to loans 1.14 % 1.53 %   
Allowance for loan losses to loans, excl. acquired loans 1.35   1.53     
Net charge-offs to average loans (4) .12   .31     
NPAs to loans and foreclosed properties .46   .42     
NPAs to total assets .29   .26     
              
AVERAGE BALANCES ($ in millions)             
Loans$  5,298  $  4,450     19   
Investment securities   2,368     2,274     4   
Earning assets   7,834     6,880     14   
Total assets   8,462     7,436     14   
Deposits   7,055     6,228      13   
Shareholders' equity   869      720     21   
Common shares - basic (thousands)   65,488     60,588     8   
Common shares - diluted (thousands)   65,492     60,590     8   
         
AT PERIOD END ($ in millions)       
Loans$  5,995  $  4,672     28   
Investment securities   2,656     2,198     21   
Total assets   9,626     7,567     27   
Deposits   7,881     6,327     25   
Shareholders' equity   1,018     740     38   
Common shares outstanding (thousands)   71,484     60,259     19   
        
(1)  Excludes merger-related charges and impairment losses on surplus bank property.  (2)  Net income available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss).  (3)  Excludes effect of acquisition related intangibles and associated amortization.  (4)  Annualized.  (5) December 31, September 30, June 30 and March 31, 2015 calculated under Basel III rules, which became effective January 1, 2015(6)  Fourth quarter 2015 ratio is preliminary. 
        

 

UNITED COMMUNITY BANKS, INC.  
Selected Financial Information  
For the Years Ended December 31 ,  
            
(in thousands, except per share data;           
taxable equivalent)  2015   2014   2013   2012   2011  
 INCOME SUMMARY           
Net interest revenue $  258,700  $  224,418  $  219,641  $  229,758  $  238,670  
Provision for credit losses    3,700     8,500     65,500     62,500     251,000  
Fee revenue    72,529     55,554     56,598      56,112     44,907  
  Total revenue    327,529     271,472     210,739     223,370     32,577  
Expenses - operating (1)    193,243     162,865     174,304     186,774     261,599  
  Income (loss) before income tax expense (benefit) - operating (1)    134,286     108,607     36,435     36,596     (229,022) 
Income tax expense (benefit) - operating (1)    51,101     40,987     (236,705)    2,740     (2,276) 
  Net income (loss) - operating (1)    83,185     67,620     273,140     33,856     (226,746) 
Preferred dividends and discount accretion    67     439     12,078     12,148     11,838  
  Net income (loss) available to common shareholders - operating (1)    83,118     67,181     261,062     21,708     (238,584) 
Merger-related and other charges, net of income tax benefit    (11,607)    -      -      -      -   
  Net income (loss) available to common shareholders - GAAP $  71,511  $  67,181  $  261,062  $  21,708  $  (238,584) 
                      
PERFORMANCE MEASURES                     
  Per common share:                      
  Diluted income (loss) - operating (1) $  1.27  $  1.11  $  4.44   $.38  $  (5.97) 
  Diluted income (loss) - GAAP    1.09     1.11     4.44   .38     (5.97) 
  Cash dividends declared  .22   .11     -       -      -   
  Book value    14.02     12.20     11.30     6.67     6.62  
  Tangible book value (3)    12.06     12.15     11.26     6.57     6.47  
                      
  Key performance ratios:                     
  Return on tangible common equity - operating (1)(2)(3)    10.24 %   9.32 %   47.35 %   6.27 %   (96.20)%
  Return on common equity - operating (1)(2)    9.48     9.17     46.72     5.43     (93.57) 
  Return on common equity - GAAP (2)    8.15     9.17     46.72     5.43     (93.57) 
  Return on assets - operating (1)  .98   .91     3.86   .49     (3.15) 
  Return on assets - GAAP  .85   .91     3.86   .49     (3.15)  
  Dividend payout ratio - operating (1)    17.32     9.91     -      -      -   
  Dividend payout ratio - GAAP    20.18     9.91     -      -      -   
  Net interest margin    3.30      3.26     3.30     3.51     3.52  
  Efficiency ratio - operating (1)    58.51     58.26     63.14     65.43     92.27  
  Efficiency ratio - GAAP    63.96     58.26     63.14     65.43     92.27  
  Average equity to average assets    10.27     9.69     10.35     8.47     7.75  
  Average tangible equity to average assets (3)    9.74     9.67     10.31     8.38     7.62  
  Average tangible common equity to average assets (3)    9.66     9.60     7.55     5.54     3.74  
  Tangible common equity to risk-weighted assets (3)(4)(5)    12.82     13.82     13.17     8.26     8.25  
            
ASSET QUALITY           
  Non-performing loans $  22,653  $  17,881  $  26,819  $  109,894  $  127,479  
  Foreclosed properties    4,883     1,726     4,221     18,264     32,859  
  Total non-performing assets (NPAs)    27,536     19,607     31,040     128,158     160,338  
  Allowance for loan losses    68,448     71,619      76,762     107,137     114,468   
  Net charge-offs    6,259     13,879     93,710     69,831     311,227  
  Allowance for loan losses to loans    1.14 %   1.53 %   1.77 %   2.57 %   2.79 %
  Allowance for loan losses to loans, excluding acquired loans    1.35     1.53     1.77     2.57     2.79  
  Net charge-offs to average loans  .12   .31     2.22     1.69     7.33  
  NPAs to loans and foreclosed properties  .46   .42   .72     3.06     3.87  
  NPAs to total assets  .29   .26   .42     1.88     2.30  
                       
AVERAGE BALANCES ($ in millions)                     
  Loans $  5,298  $  4,450  $  4,254  $  4,166  $  4,307  
  Investment securities    2,368      2,274     2,190     2,089     1,999  
  Earning assets    7,834     6,880     6,649     6,547     6,785  
  Total assets    8,462     7,436     7,074     6,865     7,189  
  Deposits    7,055     6,228     6,027     5,885     6,275  
  Shareholders' equity    869     720     732     582     557  
  Common shares - Basic (thousands)    65,488     60,588     58,787     57,857     39,943  
  Common shares - Diluted (thousands)    65,492     60,590     58,845     57,857     39,943  
                       
AT YEAR END ($ in millions)                     
  Loans $  5,995  $  4,672  $  4,329  $  4,175  $  4,110  
  Investment securities    2,656     2,198     2,312     2,079     2,120  
  Total assets    9,626     7,567     7,425     6,802     6,983  
  Deposits    7,881     6,327     6,202     5,952     6,098  
  Shareholders' equity    1,018     740     796     581     575  
  Common shares outstanding (thousands)    71,484     60,259     59,432     57,741     57,561  
             
(1)  Excludes merger-related charges and impairment losses on surplus bank property.  (2)  Net income (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).  (3)  Excludes effect of acquisition related intangibles and associated amortization.  (4) December 31, 2015 calculated under Basel III rules, which became effective January 1, 2015(5) 2015 ratio is preliminary.
            

 

UNITED COMMUNITY BANKS, INC. 
Non-GAAP Performance Measures Reconciliation 
Selected Financial Information 
          
          
  2015   2014  
(in thousands, except per share Fourth   Third   Second   First   Fourth 
data; taxable equivalent)Quarter Quarter Quarter Quarter Quarter
          
Interest revenue reconciliation         
Interest revenue - taxable equivalent$  79,646  $  71,120  $  66,134  $  62,909  $  64,353  
Taxable equivalent adjustment   (284)    (292)    (326)    (375)    (398) 
  Interest revenue (GAAP)$  79,362  $  70,828  $  65,808  $  62,534  $  63,955  
                     
Net interest revenue reconciliation                     
Net interest revenue - taxable equivalent$  74,048  $  65,718  $  61,317  $  57,617  $  58,332  
Taxable equivalent adjustment   (284)    (292)    (326)    (375)    (398) 
  Net interest revenue (GAAP)$  73,764  $  65,426  $  60,991  $  57,242  $  57,934  
                     
Total revenue reconciliation                    
Total operating revenue$  95,032  $  83,315   $  77,683  $  71,499  $  71,355  
Taxable equivalent adjustment   (284)    (292)    (326)    (375)    (398) 
  Total revenue (GAAP)$  94,748  $  83,023  $  77,357  $  71,124  $  70,957  
                     
Expense reconciliation                    
Expenses - operating$  56,410  $  48,525  $  45,247  $  43,061  $  41,919  
Merger-related and other charges   9,078     5,744     3,173     -      -   
  Expenses (GAAP)$  65,488  $  54,269  $  48,420  $  43,061  $  41,919  
                     
Income before taxes reconciliation                     
Income before taxes - operating$  38,622  $  34,790  $  32,436  $  28,438  $  29,436  
Taxable equivalent adjustment   (284)    (292)    (326)    (375)    (398) 
Merger-related and other charges   (9,078)    (5,744)    (3,173)    -      -   
  Income before taxes (GAAP)$  29,260  $  28,754  $  28,937  $  28,063  $  29,038  
                     
Income tax expense reconciliation                    
Income tax expense - operating$  14,822  $  13,064  $  12,447  $  10,768  $  11,189  
Taxable equivalent adjustment   (284)    (292)    (326)    (375)    (398) 
Merger-related and other charges, tax benefit   (3,486)    (1,905)    (997)    -       -   
  Income tax expense (GAAP)$  11,052  $  10,867  $  11,124  $  10,393  $  10,791  
                      
Net income reconciliation                    
Net income - operating$  23,800  $  21,726  $  19,989  $  17,670  $  18,247  
Merger-related and other charges, net of income tax benefit   (5,592)    (3,839)    (2,176)    -      -   
  Net income (GAAP)$  18,208  $  17,887  $  17,813  $  17,670  $  18,247  
                     
Net income available to common shareholders reconciliation                     
Net income available to common shareholders - operating$  23,775  $  21,701  $  19,972  $  17,670  $  18,247  
Merger-related and other charges, net of income tax benefit   (5,592)    (3,839)     (2,176)    -      -   
  Net income available to common shareholders (GAAP)$  18,183  $  17,862  $  17,796  $  17,670  $  18,247  
                     
Diluted income per common share reconciliation                    
Diluted income per common share - operating$.33  $.33  $.32  $.29  $.30  
Merger-related and other charges (.08  (.06  (.04    -      -   
  Diluted income per common share (GAAP)$.25  $.27  $.28  $.29  $.30  
                     
Book value per common share reconciliation                     
Tangible book value per common share$  12.06  $  12.08  $  12.66  $  12.53  $  12.15  
Effect of goodwill and other intangibles   1.96     1.87   .29    .05   .05  
  Book value per common share (GAAP)$  14.02  $  13.95  $  12.95  $  12.58  $  12.20  
                     
Return on tangible common equity reconciliation                     
Return on tangible common equity - operating   10.87 %   10.29 %   10.20 %   9.46 %   9.74 %
Effect of goodwill and other intangibles   (1.69)  (.75  (.30)  (.12  (.14) 
Return on common equity - operating   9.18     9.54     9.90     9.34     9.60  
Merger-related and other charges   (2.16)    (1.69)    (1.07)    -      -   
  Return on common equity (GAAP)   7.02 %   7.85 %   8.83 %   9.34 %   9.60 %
                     
Return on assets reconciliation                    
Return on assets - operating .99 %   1.00 %   1.00 % .94 % .96 %
Merger-related and other charges (.23  (.18  (.11    -      -   
  Return on assets (GAAP) .76 % .82 % .89 % .94 % .96 %
                     
Allowance for loan losses to loans reconciliation                    
Allowance for loan losses to loans, excl. acquired loans   1.35 %   1.37 %   1.42 %   1.46 %   1.53 %
Effect of removing acquired loans from ratio (.21  (.22  (.06     -      -   
  Allowance for loan losses to loans (GAAP)   1.14 %   1.15 %   1.36 %   1.46 %   1.53 %
                     
Dividend payout ratio reconciliation                    
Dividend payout ratio - operating   18.18  %   18.18 %   15.63 %   17.24 %   16.67 %
Merger-related and other charges   5.82     4.04     2.23     -      -   
  Dividend payout ratio (GAAP)   24.00 %   22.22 %   17.86 %   17.24 %   16.67 %
                     
Efficiency ratio reconciliation                    
Efficiency ratio - operating   59.41  %   57.81 %   57.59 %   59.15 %   57.47 %
Merger-related and other charges   9.56     6.84     4.04     -      -   
  Efficiency ratio (GAAP)   68.97 %   64.65 %   61.63 %   59.15 %   57.47 %
                     
Average equity to assets reconciliation                    
Tangible common equity to assets 9.29 % 9.77 % 9.83 % 9.82 % 9.72 %
Effect of preferred equity .11   .11   .08     -      -   
  Tangible equity to assets   9.40     9.88      9.91     9.82     9.72  
Effect of goodwill and other intangibles   1.28   .51   .14   .04   .04  
  Equity to assets (GAAP)   10.68 %   10.39 %   10.05 %   9.86 %   9.76 %
                     
Tangible common equity to risk-weighted assets reconciliation (1)                    
Tangible common equity to risk-weighted assets   12.82 %   13.08 %   13.24 %   13.53 %   13.82 %
Effect of other comprehensive income .38   .23   .28   .19   .35  
Effect of deferred tax limitation   (2.05)    (2.24)    (2.49)    (2.86)    (3.11) 
Effect of trust preferred .08   .08   .63   .67     1.00  
Effect of preferred equity .15   .15   .17     -      -   
Basel III intangibles transition adjustment .10   .13   .06   .04     -   
Basel III disallowed investments (.03  (.03  (.03  (.04    -   
 Tier I capital ratio (Regulatory) 11.45 % 11.40 % 11.86 % 11.53 %   12.06 %
                     
(1)  December 31, September 30, June 30 and March 31, 2015 calculated under Basel III rules, which became effective January 1, 2015.  Fourth quarter 2015 ratios are preliminary.
 
           

 

UNITED COMMUNITY BANKS, INC. 
Non-GAAP Performance Measures Reconciliation 
Selected Financial Information 
          
 For the Twelve Months Ended
  December 31,
  
(in thousands, except per share                    
data; taxable equivalent) 2015   2014   2013   2012   2011  
          
Interest revenue reconciliation          
Interest revenue - taxable equivalent$  279,809  $  249,969   $  247,323  $  267,667  $  304,308  
Taxable equivalent adjustment   (1,277)    (1,537)    (1,483)    (1,690)    (1,707) 
  Interest revenue (GAAP)$  278,532  $  248,432  $  245,840  $  265,977  $  302,601  
                     
Net interest revenue reconciliation                    
Net interest revenue - taxable equivalent$  258,700  $  224,418  $  219,641  $  229,758  $  238,670  
Taxable equivalent adjustment   (1,277)    (1,537)    (1,483)    (1,690)    (1,707) 
  Net interest revenue (GAAP)$  257,423  $  222,881  $  218,158  $  228,068  $  236,963  
                     
Total revenue reconciliation                    
Total operating revenue$  327,529  $  271,472  $  210,739  $  223,370  $  32,577  
Taxable equivalent adjustment   (1,277)    (1,537)    (1,483)    (1,690)    (1,707) 
  Total revenue (GAAP)$  326,252  $  269,935  $  209,256  $  221,680  $  30,870  
                     
Expense reconciliation                    
Expenses - operating$  193,243  $  162,865  $  174,304  $  186,774  $  261,599  
Merger-related and other charges   17,995     -      -       -      -   
  Expenses (GAAP)$  211,238  $  162,865  $  174,304  $  186,774  $  261,599  
                     
Income before taxes reconciliation                    
Income before taxes - operating$  134,286  $  108,607  $  36,435  $   36,596  $  (229,022) 
Taxable equivalent adjustment   (1,277)    (1,537)    (1,483)    (1,690)    (1,707) 
Merger-related and other charges   (17,995)    -      -      -      -   
  Income before taxes (GAAP)$  115,014  $  107,070  $  34,952  $  34,906  $  (230,729) 
                     
Income tax expense reconciliation                    
Income tax expense - operating$  51,101  $  40,987  $  (236,705) $  2,740  $  (2,276) 
Taxable equivalent adjustment   (1,277)    (1,537)    (1,483)    (1,690)    (1,707) 
Merger-related and other charges, tax benefit   (6,388)    -      -      -      -   
  Income tax expense (GAAP)$  43,436  $  39,450  $  (238,188) $  1,050  $  (3,983) 
                     
Net income reconciliation                    
Net income - operating$  83,185  $  67,620  $  273,140  $  33,856  $  (226,746) 
Merger-related charges, net of income tax benefit   (11,607)    -      -      -      -   
  Net income (GAAP)$  71,578  $  67,620  $  273,140  $  33,856  $  (226,746) 
                     
Net income available to common shareholders reconciliation                     
Net income available to common shareholders - operating$  83,118  $  67,181  $  261,062  $  21,708  $  (238,584) 
Merger-related charges, net of income tax benefit   (11,607)    -      -      -      -   
  Net income available to common shareholders (GAAP)$  71,511  $  67,181  $  261,062  $  21,708  $  (238,584) 
                     
Diluted income per common share reconciliation                    
Diluted income per common share - operating$  1.27  $  1.11  $  4.44  $.38  $  (5.97) 
Merger-related and other charges (.18)    -      -      -      -   
  Diluted income per common share (GAAP)$  1.09  $  1.11  $  4.44  $.38  $  (5.97) 
                     
Book value per common share reconciliation                    
Tangible book value per common share$  12.06  $  12.15  $  11.26  $  6.57  $  6.47  
Effect of goodwill and other intangibles   1.96   .05   .04   .10   .15  
 Book value per common share (GAAP)$14.02   $12.20  $11.30  $  6.67  $  6.62  
                     
Return on tangible common equity reconciliation         
Return on tangible common equity - operating   10.24 %   9.32 %   47.35 %   6.27 %   (96.20)%
Effect of goodwill and other intangibles (.76)   (.15)  (.63)  (.84)    2.63  
Return on common equity - operating   9.48     9.17     46.72     5.43     (93.57) 
Merger-related and other charges   (1.33)     -      -      -      -   
  Return on common equity (GAAP)   8.15 %   9.17 %   46.72 %   5.43 %   (93.57)%
                     
Return on assets reconciliation                    
Return on assets - operating .98 % .91 %   3.86 % .49 %   (3.15)%
Merger-related charges (.13)    -      -      -       -   
  Return on assets (GAAP) .85 % .91 %   3.86 % .49 %   (3.15)%
                      
Allowance for loan losses to loans reconciliation                    
Allowance for loan losses to loans , excl. acquired loans   1.35 %   1.53 %   1.77 %   2.57 %   2.79 %
Effect of removing acquired loans from ratio (.21 )    -      -      -      -   
  Allowance for loan losses to loans (GAAP)   1.14 %   1.53 %   1.77 %   2.57 %   2.79 
                     
Dividend payout ratio reconciliation                     
Dividend payout ratio - operating   17.32 %   9.91 %   -  %   -  %   -  %
Merger-related charges   2.86     -      -      -      -   
 Dividend payout ratio (GAAP) 20.18 % 9.91 % - % - %    - %
                     
Efficiency ratio reconciliation         
Efficiency ratio - operating   58.51 %   58.26 %   63.14 %   65.43 %   92.27 %
Merger-related charges   5.45     -      -      -       -   
 Efficiency ratio (GAAP)   63.96 %   58.26 %   63.14 % 65.43 % 92.27 %
                     
Average equity to assets reconciliation         
Tangible common equity to assets 9.66 % 9.60 % 7.55 % 5.54 % 3.74 
Effect of preferred equity .08   .07     2.76     2.84     3.88  
  Tangible equity to assets   9.74     9.67     10.31     8.38     7.62  
Effect of goodwill and other intangibles .53   .02   .04   .09   .13  
 Equity to assets (GAAP) 10.27 %   9.69 %  10.35 %   8.47 % 7.75 %
                     
Tangible common equity to risk-weighted assets reconciliation (1)           
Tangible common equity to risk-weighted assets   12.82 %   13.82 %   13.18 %   8.26 %   8.25 %
Effect of other comprehensive income .38   .35   .39   .51   (.03) 
Effect of deferred tax limitation   (2.05)    (3.11)    (4.26)    -      -   
Effect of trust preferred .08     1.00     1.04     1.15     1.18  
Effect of preferred equity .15     -      2.39     4.24     4.29  
Basel III intangibles transition adjustment .10     -      -      -       -   
Basel III disallowed investments (.03)    -      -      -      -   
 Tier I capital ratio (Regulatory) 11.45 %   12.06 % 12.74 % 14.16 % 13.69 %
                     
 (1)  December 31, September 30, June 30 and March 31, 2015 calculated under Basel III rules, which became effective January 1, 2015.  Fourth quarter 2015 ratios are preliminary.
 

 

UNITED COMMUNITY BANKS, INC. 
Financial Highlights 
Loan Portfolio Composition at Period-End 
           
           
   2015   2014 
    Fourth   Third   Second   First   Fourth 
(in millions) Quarter Quarter Quarter Quarter Quarter
LOANS BY CATEGORY          
Owner occupied commercial RE $  1,494  $  1,479  $  1,266  $  1,167  $  1,163 
Income producing commercial RE    824     818      689     636     599 
Commercial & industrial    785     890     793     716      710 
Commercial construction    342     319     238     230     196 
  Total commercial    3,445      3,506     2,986     2,749     2,668 
Residential mortgage    1,029     1,062     935      864     866 
Home equity lines of credit    598     585     491      465     466 
Residential construction    352     334     299      291     299 
Consumer installment    571     537     463      419     373 
  Total loans $  5,995  $  6,024  $  5,174  $  4,788  $  4,672 
           
LOANS BY MARKET          
North Georgia $  1,125  $  1,130  $  1,155  $  1,150  $  1,163 
Atlanta MSA    1,259     1,266     1,275     1,254     1,243 
North Carolina    549     546     533     539     553 
Coastal Georgia    537     506     499     476     456 
Gainesville MSA    254     252     257     255     257 
East Tennessee    504     511     525     281     280 
South Carolina    819     783     35     30      30 
Specialized Lending    492     609     538     487      421 
Indirect auto    456     421     357     316     269 
  Total loans $  5,995   $  6,024  $  5,174  $  4,788  $  4,672 
           

 

UNITED COMMUNITY BANKS, INC. 
Financial Highlights 
Loan Portfolio Composition at Period-End 
              
              
 2015 2014   Linked   Year over 
  Fourth   Third   Fourth   Quarter   Year 
(in millions)Quarter Quarter Quarter  Change   Change 
LOANS BY CATEGORY         
Owner occupied commercial RE$  1,494  $  1,479  $  1,163  $   15   $   331   
Income producing commercial RE   824     818     599      6       225  
Commercial & industrial   785     890     710       (105      75  
Commercial construction   342      319     196      23       146  
  Total commercial   3,445     3,506     2,668      (61      777  
Residential mortgage   1,029     1,062     866      (33)      163  
Home equity lines of credit   598     585     466      13       132  
Residential construction   352     334     299       18       53  
Consumer installment   571     537     373      34       198  
  Total loans$  5,995  $  6,024  $  4,672      (29      1,323  
          
LOANS BY MARKET         
North Georgia$  1,125  $  1,130  $  1,163   $  (5   $  (38 
Atlanta MSA   1,259     1,266     1,243       (7)      16  
North Carolina   549     546     553      3       (4 
Coastal Georgia   537     506     456      31       81  
Gainesville MSA   254     252     257      2        (3 
East Tennessee   504     511      280      (7)      224  
South Carolina   819     783     30      36        789  
Specialized Lending   492     609     421      (117)      71  
Indirect auto   456     421     269      35       187  
  Total loans$  5,995  $  6,024   $  4,672       (29)      1,323  
          

 

UNITED COMMUNITY BANKS, INC. 
Financial Highlights 
Loan Portfolio Composition at Year-End 
            
           
(in millions)  2015   2014   2013   2012   2011 
LOANS BY CATEGORY          
Owner occupied commercial RE $  1,494  $  1,163  $  1,134  $  1,131  $  1,112 
Income producing commercial RE    824     599     623     682      710 
Commercial & industrial    785     710     472     458      428 
Commercial construction    342     196     149     155     164 
  Total commercial    3,445     2,668     2,378     2,426     2,414 
Residential mortgage     1,029     866     875     829     835 
Home equity lines of credit     598     466     441     385     300 
Residential construction     352     299     328     382     448 
Consumer installment    571     373     307     153     113 
  Total loans $  5,995  $  4,672  $  4,329  $  4,175  $  4,110 
           
           
LOANS BY MARKET          
North Georgia $  1,125  $  1,163   $  1,240  $  1,364  $  1,426 
Atlanta MSA    1,259     1,243      1,235     1,204     1,144 
North Carolina    549     553     572     579     597 
Coastal Georgia    537     456     423     400     346 
Gainesville MSA    254     257     255     261     265 
East Tennessee    504     280     280     283      256 
South Carolina    819     30     4     -      -  
Specialized Lending    492     421     124     46     76 
Indirect auto    456     269     196     38     -  
  Total loans $  5,995  $  4,672  $  4,329  $  4,175  $  4,110 
           

 

UNITED COMMUNITY BANKS, INC. 
Financial Highlights 
Credit Quality 
          
          
  Fourth Quarter 2015
    Nonperforming   Foreclosed   Total 
(in thousands) Loans Properties NPAs
NONPERFORMING ASSETS BY CATEGORY      
Owner occupied CRE $  7,036  $  2,652  $  9,688 
Income producing CRE    2,595     -      2,595 
Commercial & industrial    892     -      892 
Commercial construction    328     437     765 
  Total commercial    10,851     3,089     13,940 
Residential mortgage    8,555     1,242     9,797 
Home equity lines of credit    851     80     931 
Residential construction    1,398     472     1,870 
Consumer installment    998     -      998 
  Total NPAs $  22,653  $  4,883  $  27,536 
  Balance as a % of          
  Unpaid Principal   71.4%  34.2%  59.8%
          
NONPERFORMING ASSETS BY MARKET       
North Georgia $  5,167  $  1,612  $  6,779 
Atlanta MSA    3,023     625     3,648 
North Carolina    5,289     183     5,472 
Coastal Georgia    2,079     -      2,079 
Gainesville MSA    307     -      307 
East Tennessee    3,448     157     3,605 
South Carolina    323     2,306     2,629 
Specialized Lending    2,231     -      2,231 
Indirect auto    786     -      786 
  Total NPAs $  22,653  $  4,883  $  27,536 
          
          
NONPERFORMING ASSETS ACTIVITY       
Beginning Balance $  20,064  $  7,669  $  27,733 
Acquisitions    -      (1,585)    (1,585)
Loans placed on non-accrual     10,768     -      10,768 
Payments received    (4,893)    -      (4,893)
Loan charge-offs    (1,813)    -      (1,813)
Foreclosures    (1,473)    1,497     24 
Capitalized costs    -      -      -  
Property sales    -      (2,968)    (2,968)
Write downs    -      11     11 
Net gains (losses) on sales    -      259     259 
  Ending Balance $  22,653  $  4,883  $  27,536 
          

 

UNITED COMMUNITY BANKS, INC. 
Financial Highlights 
Credit Quality 
          
          
  Third Quarter 2015
   Nonperforming   Foreclosed   Total 
(in thousands) Loans Properties NPAs
NONPERFORMING ASSETS BY CATEGORY      
Owner occupied CRE $  5,918  $  882  $  6,800 
Income producing CRE    1,238     4,084     5,322 
Commercial & industrial    1,068     -      1,068 
Commercial construction     256     657     913 
  Total commercial    8,480     5,623     14,103 
Residential mortgage    8,847     1,454     10,301 
Home equity lines of credit    890     87     977 
Residential construction    929      505     1,434 
Consumer installment    918     -      918 
  Total NPAs $  20,064  $  7,669  $  27,733 
  Balance as a % of          
  Unpaid Principal  70.3%   45.8%  61.2%
          
NONPERFORMING ASSETS BY MARKET       
North Georgia $  6,403  $  1,263   $  7,666 
Atlanta MSA    1,750     1,122     2,872 
North Carolina    4,564     9     4,573 
Coastal Georgia    338     66     404 
Gainesville MSA    325     3     328 
East Tennessee    2,886     231     3,117 
South Carolina    267     4,975     5,242 
Specialized Lending    2,809     -      2,809 
Indirect auto    722     -      722 
  Total NPAs $  20,064  $  7,669  $  27,733 
          
          
NONPERFORMING ASSETS ACTIVITY       
Beginning Balance $  18,805  $  2,356  $  21,161 
Acquisitions    -      4,848     4,848 
Loans placed on non-accrual    8,923     -      8,923 
Payments received    (4,233)    -      (4,233)
Loan charge-offs    (1,531)    -      (1,531)
Foreclosures    (1,900)    1,900     -  
Capitalized costs    -      256     256 
Property sales    -      (1,916)    (1,916)
Write downs    -      (79)     (79)
Net gains (losses) on sales    -      304     304 
  Ending Balance $  20,064  $  7,669   $  27,733 
           

 

UNITED COMMUNITY BANKS, INC. 
Financial Highlights 
Credit Quality 
           
          
  Second Quarter 2015
   Nonperforming   Foreclosed    Total 
(in thousands) Loans Properties NPAs
NONPERFORMING ASSETS BY CATEGORY      
Owner occupied CRE $  4,878  $  360  $  5,238 
Income producing CRE    883     -      883 
Commercial & industrial    1,389     -      1,389 
Commercial construction    59     382     441 
  Total commercial    7,209     742     7,951 
Residential mortgage    8,599     1,373     9,972 
Home equity lines of credit    940     54     994 
Residential construction    1,358     187     1,545 
Consumer installment    699     -      699 
  Total NPAs $  18,805  $  2,356  $  21,161 
  Balance as a % of          
  Unpaid Principal  64.9%  46.6%  62.2%
          
NONPERFORMING ASSETS BY MARKET       
North Georgia $  6,157  $  657  $  6,814 
Atlanta MSA    2,361     135     2,496 
North Carolina    4,746      690     5,436 
Coastal Georgia    659     -      659 
Gainesville MSA    864     22     886 
East Tennessee    1,885     852     2,737 
South Carolina    -      -      -  
Specialized Lending    1,565     -     1,565 
Indirect auto    568     -      568 
  Total NPAs $  18,805  $  2,356  $  21,161 
          
          
NONPERFORMING ASSETS ACTIVITY       
Beginning Balance $  19,015  $  1,158  $  20,173 
Acquisitions    -      962     962 
Loans placed on non-accrual    6,552     -      6,552 
Payments received    (3,839)    -      (3,839)
Loan charge-offs    (1,854)    -      (1,854)
Foreclosures    (1,069)    1,069     -  
Capitalized costs    -      -      -  
Property sales    -      (895)    (895)
Write downs    -      (9)    (9)
Net gains (losses) on sales    -      71     71 
  Ending Balance $  18,805  $  2,356  $  21,161 
           

 

UNITED COMMUNITY BANKS, INC.   
Financial Highlights   
Credit Quality   
                      
                     
  Fourth Quarter 2015 Third Quarter 2015 Second Quarter 2015  
    Net Charge-    Net Charge-    Net Charge-   
     Offs to      Offs to     Offs to   
   Net   Average   Net   Average    Net   Average   
(in thousands) Charge-Offs Loans (1) Charge-Offs Loans (1) Charge-Offs Loans (1)  
NET CHARGE-OFFS BY CATEGORY                   
Owner occupied CRE $  861    .23% $  236    .07% $  285    .09%  
Income producing CRE    (35 )   (.02)     (106)   (.06)     (276)   (.17)   
Commercial & industrial    (719)   (.34)     190    .09     (627)   (.33)   
Commercial construction    253    .31     59    .09     96    .16   
  Total commercial    360    .04     379    .05     (522)   (.07)   
Residential mortgage     (120)   (.05)     433    .18     787    .35   
Home equity lines of credit    194    .13     293    .22     322    .27   
Residential construction     415    .48     (124)   (.16)     107    .14   
Consumer installment    453    .33     436    .35     284    .26   
  Total $  1,302    .09  $  1,417    .10  $  978    .08   
                     
                     
NET CHARGE-OFFS BY MARKET                  
North Georgia $  1,011    .36% $  1,352    .47 $  911    .32%  
Atlanta MSA    496    .16     74    .02     138