UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date
of
Report (Date of earliest event reported):
July
9,
2007
United
Community Banks, Inc.
(Exact
name of registrant as specified in its charter)
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Georgia
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No.
0-21656
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No.
58-180-7304
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(State
or other jurisdiction of
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(Commission
File Number)
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(IRS
Employer
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incorporation)
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Identification
No.)
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63
Highway 515, P.O. Box 398
Blairsville,
Georgia 30512
(Address
of principal executive offices)
Registrant's
telephone number, including area code:
(706)
781-2265
Not
applicable
(Former
name or former address, if changed since last report)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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q
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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q
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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q
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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q
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240-13e-4(c))
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ITEM
7.01 Regulation
FD Disclosure
On
July
9, 2007, United Community Banks, Inc. (“United”) issued a press release, a copy
of which is furnished as Exhibit 99.1 hereto and incorporated by reference
herein.
ITEM
9.01 FINANCIAL
STATEMENTS AND EXHIBITS
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Exhibit
No.
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Description
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99.1
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Press
Release dated July 9, 2007
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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/s/
Rex S. Schuette
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|||
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Rex
S. Schuette
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|||
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Executive
Vice President and
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|||
| July 9, 2007 | Chief Financial Officer |
Exhibit
99.1
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For
Immediate Release
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July
9, 2007
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For
more information:
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Rex
S. Schuette
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David
P. Shearrow
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Chief
Financial Officer
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Chief
Risk Officer
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(706)
781-2266
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(706)
781-2296
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Rex_Schuette@ucbi.com
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David_Shearrow@ucbi.com
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UNITED
COMMUNITY BANKS ANNOUNCES SPECIAL PROVISION
FOR
FRAUD RELATED LOAN LOSSES IN NORTH CAROLINA
HIGHLIGHTS:
| · |
No
Other Lot Loan Concentrations -- Isolated Issue and Fraud
Related
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| · |
Reaffirms
Second Quarter operating EPS, excluding Special Provision
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BLAIRSVILLE,
GA, July 9, 2007 - United Community Banks, Inc. (Nasdaq: UCBI), Georgia’s third
largest bank holding company,
announced that it will record a special $15 million provision for fraud related
loan losses pertaining to the developments of The Village of Penland and
Winery
Heights located near Spruce Pine, North Carolina. United’s management has been
carefully monitoring the developments and the company has conducted a more
thorough investigation into this matter since its June 12 announcement.
“We
have
completed an extensive review of our controls, underwriting practices, and
risk
management processes related to this matter,” stated Jimmy Tallent, United’s
president and chief executive officer. “We have reviewed our lot loans to
individuals across the company as well as any concentrations by development
and
there are no other large concentrations in a single development when measured
by
number of loans or dollar amount. During our investigation, we discovered
additional information relating to the borrowers and collateral values and
determined that expected losses were greater than originally estimated,
requiring this special provision to the allowance for loan
losses.”
“We
believe that providing for these probable losses is the right thing to do
at
this time and the best way to move forward,” said Tallent. “Unfortunate events
such as this can divert attention from day to day banking activities, so
it is
important that we deal with them decisively and directly. We have classified
the
entire $23.6 million of individual lot loans within the Spruce Pine developments
as non-performing loans as of quarter-end. We have not taken any charge-offs,
but anticipate most of the charge-offs will occur over the next two quarters
if,
and when, the borrowers default on their loans. Even though we may charge-off
a
portion of these loans we will also aggressively pursue collection of the
debt
from the borrowers. We found through discussions with several borrowers that
many, if not most, were active participants in the scheme and were compensated
by the developer with upfront cash payments or interest reserves.”
“Solid
credit quality has always been and remains a top priority for United Community
Banks,” said Tallent. “After a careful review of our entire loan portfolio, we
concluded that this loss was an isolated occurrence. Although it is impossible
to completely eliminate losses due to fraud, we have strengthened our lending
and risk monitoring processes to reduce our risk of future losses.”
“We
look
forward to putting this behind us so we can focus on those things that have
made
United Community Banks so successful - outstanding customer service, solid
credit quality and double-digit growth in operating earnings per share,” stated
Tallent. “Excluding the impact of this $15 million provision, or $.20 per
diluted share, we expect to report operating earnings of $.46 per diluted
share
for the second quarter, which is slightly above consensus and 12 percent
above
the second quarter of 2006. We will comment further on earnings for the second
quarter during our scheduled conference call on July 24.”
Conference
Call
United
Community Banks will hold a conference call on Tuesday, July 10, 2007, at
11
a.m. ET to discuss the contents of this news release. The telephone number
for
the conference call is (866) 356-3093 and the pass code is "UCBI." The
conference call will also be available by web cast within the Investor Relations
section of the company's web site 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 approximately $8.0 billion
and
operates 27 community banks with 109 banking offices located throughout north
Georgia, metro Atlanta, coastal Georgia, western North Carolina and east
Tennessee. The company specializes in providing personalized community banking
services to individuals and small to mid-size businesses. United Community
Banks
also offers the convenience of 24-hour access through a network of ATMs,
telephone and on-line banking. United Community Banks common stock is listed
on
the Nasdaq Global Select Market under the symbol UCBI. Additional information
may be found at the company's web site at www.ucbi.com.
Safe
Harbor
This
news
release contains forward-looking statements, as defined by Federal Securities
Laws, including statements about financial outlook and business environment.
These statements are provided to assist in the understanding of future financial
performance and such performance involves risks and uncertainties that may
cause
actual results to differ materially from those in such statements. Any such
statements are based on current expectations and involve a number of risks
and
uncertainties. For a discussion of factors that may cause such forward-looking
statements to differ materially from actual results, please refer to the
section
entitled “Forward-Looking Statements” on page 4 of United Community Banks,
Inc.’s annual report filed on Form 10-K with the Securities and Exchange
Commission.
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