SEC Filing | United Community Banks, Inc.

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8-K

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): January 29, 2010

United Community Banks, Inc.

(Exact name of registrant as specified in its charter)


Georgia	No. 0-21656	No. 58-180-7304

(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)


63 Highway 515, P.O. Box 398 Blairsville, Georgia		30512

(Address of principal executive offices)		(Zip Code)

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:

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operation and Financial Condition

On January 29, 2010, United Community Banks, Inc. (the “Registrant”) issued a news release announcing its financial results for the quarter and year ended December 31, 2009 (the “News Release”). The News Release, including financial schedules, is attached as Exhibit 99.1 to this report. In connection with issuing the News Release, on January 29, 2010 at 11:00 a.m. EST, the Registrant intends to hold a conference call/webcast to discuss the News Release. In addition to the News Release, during the conference call the Registrant intends to discuss certain financial information contained in the Fourth Quarter 2009 Investor Presentation (the “Investor Presentation”) which will be posted to the Registrant’s website. The Investor Presentation is attached as Exhibit 99.2 to this report.

The presentation of the Registrant’s financial results included operating performance measures and core earnings measures, which are measures of performance determined by methods other than in accordance with generally accepted accounting principles, or GAAP. Management included non-GAAP operating performance and core earnings measures because it believes it is useful for evaluating the Registrant’s operations and performance over periods of time, and uses operating performance and core earnings measures in managing and evaluating the Registrant’s business and intends to use it in discussions about the Registrant’s operations and performance. Operating performance measures for 2009 exclude the effects of $25 million and $70 million, non-cash goodwill impairment charges in the third and first quarters, respectively, (bringing the total goodwill impairment charge for the year to $95 million), $2.9 million in non-recurring severance charges related to a reduction in workforce recorded in the first quarter and an $11.4 million gain in the second quarter from the acquisition of Southern Community Bank that resulted from a bargain purchase. These items have been excluded from operating performance measures because management feels that the two expense items and the bargain purchase gain are non-recurring in nature and do not reflect overall trends in the Registrant’s earnings. Additionally, core earnings measures exclude credit related costs such as the provision for loan losses and foreclosed property expense, securities gains and losses, income taxes and other items of a non-recurring nature. Core earnings are useful in evaluating the underlying earnings performance trends of the Registrant. Management believes these non-GAAP performance measures may provide users of the Registrant’s financial information with a meaningful measure for assessing the Registrant’s financial results and comparing those financial results to prior periods.

Operating performance and core earnings measures should be viewed in addition to, and not as an alternative or substitute for, the Registrant’s performance measures determined in accordance with GAAP, and is not necessarily comparable to non-GAAP performance measures that may be presented by other companies.

Item 9.01 Financial Statements and Exhibits

	(a)		Financial statements: None

	(b)		Pro forma financial information: None

	(c)		Exhibits:

	99.1		Press Release, dated January 29, 2010

	99.2		Investor Presentation, Fourth Quarter 2009

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.



	*/s/ Rex S. Schuette*
	Rex S. Schuette
January 29, 2010	Executive Vice President and Chief Financial Officer

EX-99.1

Exhibit 99.1

(LOGO)

For Immediate Release

For more information:
Rex S. Schuette
Chief Financial Officer
(706) 781-2266
Rex_Schuette@ucbi.com

UNITED COMMUNITY BANKS, INC. REPORTS
NET OPERATING LOSS FOR FOURTH QUARTER 2009

•

Non-performing assets down $30 million to $385 million from last quarter

•

Provision for loan losses of $90 million exceeded charge-offs by $5.4 million

•

Allowance-to-loans ratio of 3.02 percent, up from 2.80 percent last quarter

•

Margin continues to improve to 3.40%, up 70 basis points from a year ago

•

Capital ratios remain strong

BLAIRSVILLE, GA – January 29, 2010 – United Community Banks, Inc. (NASDAQ: UCBI) today reported a net operating loss of $39.8 million, or 45 cents per diluted share, for the fourth quarter of 2009.

Net operating loss for the year 2009 was $138.6 million, or $2.47 per diluted share, and did not reflect $95 million of non-cash charges for goodwill impairment in the first and third quarters. Also not included were $2.9 million in severance costs in the first quarter and the $11.4 million gain on the Southern Community Bank acquisition in the second quarter, all of which are considered non-operating items and are therefore excluded from operating earnings. Including these non-operating items, the net loss for 2009 was $228.3 million, or $3.95 per diluted share.

“Credit continues to be our major challenge,” stated Jimmy Tallent, president and chief executive officer. “We were able to sell non-performing loans and foreclosed properties totaling $81 million, up from $55 million in the third quarter. In addition, we made significant progress in 2009 in terms of implementing offensive strategies that allowed us to almost double our quarter’s core earnings from a year ago.”

Total loans were $5.151 billion at year-end, down $212 million from the third quarter and $554 million from year-end 2008, reflecting ongoing reductions due to weakness in the residential construction market and the overall weak business environment. “The decline in loans was primarily in residential construction and acquisition and development loans,” stated Tallent. As of December 31, 2009, residential construction loans were $1.050 billion, or 20 percent of total loans, a decrease of $429 million from a year ago and $135 million from the third quarter of 2009. Our new loan business continues to offset some of this decline and totaled $273 million, or five percent for the year. The growth was consistent for all quarters, with the majority of the growth in commercial loans within the Atlanta market.

Taxable equivalent net interest revenue of $63.9 million reflected an increase of $925 thousand from last quarter. “The taxable equivalent net interest margin was 3.40 percent, up slightly from 3.39 percent last quarter,” stated Tallent. “The margin improvement would have been greater, but we made a decision to build liquidity due to uncertainties in the market. This lowered our margin by approximately 20 basis points this quarter compared to two basis points last quarter. We expect most of the excess liquidity to run off in the first half of 2010. During the quarter we continued to maintain our loan pricing while significantly reducing deposit costs, which drove the expansion of our net interest margin.”

“Though core customer transaction deposits were up only slightly from the third quarter, they grew $205 million for the year, or 10 percent, excluding the acquisition in the second quarter,” Tallent said. “This growth reflects the continued success of adding to our customer base through customer referral and cross-selling programs. For the full year of 2009, we opened 9,904 net new core deposit accounts and added 60,318 new services.”

The fourth quarter provision for loan losses was $90.0 million compared to $95.0 million for the third quarter of 2009. Net charge-offs for the fourth quarter were $84.6 million compared to $90.5 million for the third quarter of 2009. At quarter-end, non-performing assets totaled $385 million compared to $415 million at September 30, 2009. The ratio of non-performing assets to total assets at the end of the fourth and third quarters was 4.81 percent and 4.91 percent, respectively. The allowance for loan losses to total loans was 3.02 percent and 2.80 percent, respectively.

“We are pleased to report a decline in non-performing assets in the fourth quarter,” stated Tallent. “Also, on the positive side, we did see a decline this quarter in our classified and watch list loans. Our past due loans over 30 days declined from 2.02 percent to 1.44 percent. Residential construction loans continue to be at the center of our challenges. In terms of non-performing assets, we are hopeful our declining trend will continue given the portfolio run-off in Atlanta, and the decline in past dues and classified loans. However, we could face more difficulty liquidating properties in our non-Atlanta markets. We expect charge-offs to decline from current levels, but remain elevated in 2010.”

Operating fee revenue of $17.2 million for the fourth quarter of 2009 increased $1.6 million from last quarter and $6.5 million from last year primarily due to non-core revenue items. These non-core items included securities gains of $2.0 million, $1.1 million and $838 thousand for the fourth quarter 2009, third quarter 2009 and fourth quarter 2008, respectively. Also, the fourth quarter 2008 included $2.7 million in prepayment charges to restructure borrowings. Excluding these items, core fee revenue was $15.2 million for the fourth quarter of 2009, compared to $14.5 million for last quarter and $12.6 million a year ago. Service charges and fees of $8.3 million for the fourth quarter of 2009 were up $515 thousand from a year ago, primarily due to higher ATM and debit card fees relating to an increase in transactions and new customer accounts. Consulting fees of $2.8 million were up $492 thousand from last quarter and $1.5 million from a year ago due in large part to increasing demand for regulatory compliance assistance. Consulting fees were down in the fourth quarter of 2008 due to an internal project for United to improve profitability that did not result in the recognition of revenue.

Operating expenses for the fourth quarter of 2009 were $62.5 million, an increase of $10.1 million from fourth quarter 2008, driven by the $9.2 million increase in foreclosed property costs and $1.7 million increase in FDIC insurance premiums. Foreclosed property costs for the fourth quarter were $14.4 million as compared to $5.2 million last year and $7.9 million last quarter. Foreclosed property costs this quarter included $9.6 million for write-downs and losses on sales and $4.8 million for maintenance, property taxes, and other related costs. This quarter included $7.4 million of losses on sales due to the higher volume of property sold during the quarter. Also, $2.2 million of additional write downs were taken on existing foreclosed properties to help expedite future sales. Salary and benefit costs for the fourth quarter totaled $26.2 million, up from $24.4 million last year due primarily to a $3.0 million bonus accrual reduction and a deferred compensation credit adjustment of $736 thousand recorded last year. Excluding these items, salary and benefit costs were down $2.0 million compared to last year, reflective of the reduction in work force of 183 staff positions during 2009, that was offset partially by the acquisition of Southern Community Bank in June 2009. Communications costs for the quarter remained flat, while advertising and printing costs were down $325 thousand and $448 thousand, respectively, from last year. Other expenses of $4.5 million decreased $2.5 million from the fourth quarter of 2008, due primarily to $2.0 million of bank owned life insurance expenses accrued last year that were later recovered in the second quarter of 2009 with the decision to cancel the surrender of our bank owned life insurance policies.

The effective tax rate for the fourth quarter of 2009 was 45 percent, compared to 28 percent last quarter and 38 percent last year. The fourth quarter 2009 tax benefit includes the favorable settlement of a several-year state tax audit dispute that was fully reserved due to the uncertainty of the tax position. The third quarter 2008 effective rate was lower due to a goodwill impairment charge which was not a taxable event and therefore did not result in the recognition of a tax benefit. The effective tax rate for 2010 is expected to be 40 percent, slightly higher than the effective tax rate for 2008.

On December 31, 2009, the company’s regulatory capital ratios were as follows: Tier I Risk-Based Capital of 12.4 percent; Leverage of 8.5 percent; and Total Risk-Based of 15.1 percent. Also, the quarterly average tangible equity-to-assets ratio was 9.5 percent and tangible common equity-to-assets ratio was 7.4 percent.

“Our ultimate goal is to return to profitability as soon as possible, and our attention is relentlessly focused toward that goal,” concluded Tallent.

Conference Call
United Community Banks will hold a conference call today, Friday, January 29, 2010, at 11 a.m. ET to discuss the contents of this news release and to share business highlights for the quarter. To access the call, dial (888) 806-6208 and use the password ‘8006436.’ 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 web site at ir.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 107 banking offices throughout north Georgia, the Atlanta region, coastal Georgia, western North Carolina and east Tennessee. The company specializes in providing personalized community banking services to individuals and small to mid-size businesses. United Community Banks also offers the convenience of 24-hour access through a network of ATMs, telephone and on-line banking. United Community Banks common stock is listed on the Nasdaq Global Select Market under the symbol UCBI. Additional information may be found at the company’s web site at www.ucbi.com.

Safe Harbor
This news release contains forward-looking statements, as defined by Federal Securities Laws, including statements about financial outlook and business environment. These statements are provided to assist in the understanding of future financial performance and such performance involves risks and uncertainties that may cause actual results to differ materially from those in such statements. Any such statements are based on current expectations and involve a number of risks and uncertainties. For a discussion of some factors that may cause such forward-looking statements to differ materially from actual results, please refer to the section entitled “Forward-Looking Statements” on page 3 of United Community Banks, Inc.’s annual report filed on Form 10-K with the Securities and Exchange Commission.

# # #

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information


																Fourth
	2009												2008			Quarter			For the Twelve						YTD
(in thousands, except per share	Fourth			Third			Second			First			Fourth			2009-2008			Months Ended						2009-2008
data; taxable equivalent)	Quarter			Quarter			Quarter			Quarter			Quarter			Change			2009			2008			Change
INCOME SUMMARY
Interest revenue	$	97,481		$	101,181		$	102,737		$	103,562		$	108,434					$	404,961		$	466,969
Interest expense		33,552			38,177			41,855			46,150			56,561						159,734			228,265

Net interest revenue		63,929			63,004			60,882			57,412			51,873			23	%		245,227			238,704			3	%
Provision for loan losses		90,000			95,000			60,000			65,000			85,000						310,000			184,000
Operating fee revenue⁽¹⁾		17,221			15,671			13,050			12,846			10,718			61			58,788			53,141			11

Total operating revenue ⁽¹⁾		(8,850	)		(16,325	)		13,932			5,258			(22,409	)		61			(5,985	)		107,845			(106	)
Operating expenses⁽²⁾		62,532			53,606			55,348			52,569			52,439			19			224,055			206,699			8

Operating loss before taxes		(71,382	)		(69,931	)		(41,416	)		(47,311	)		(74,848	)		5			(230,040	)		(98,854	)		(133	)
Operating income tax benefit		(31,547	)		(26,213	)		(18,353	)		(15,335	)		(28,101	)					(91,448	)		(35,404	)

Net operating loss⁽¹⁾⁽²⁾		(39,835	)		(43,718	)		(23,063	)		(31,976	)		(46,747	)		15			(138,592	)		(63,450	)		(118	)
Gain from acquisition, net of tax expense		—			—			7,062			—			—						7,062			—
Noncash goodwill impairment charge		—			(25,000	)		—			(70,000	)		—						(95,000	)		—
Severance costs, net of tax benefit		—			—			—			(1,797	)		—						(1,797	)		—

Net loss		(39,835	)		(68,718	)		(16,001	)		(103,773	)		(46,747	)		15			(228,327	)		(63,450	)		(260	)
Preferred dividends and discount accretion		2,567			2,562			2,559			2,554			712						10,242			724

Net loss available to common shareholders	$	(42,402	)	$	(71,280	)	$	(18,560	)	$	(106,327	)	$	(47,459	)				$	(238,569	)	$	(64,174	)

PERFORMANCE MEASURES
Per common share:
Diluted operating loss⁽¹⁾⁽²⁾	$	(.45	)	$	(.93	)	$	(.53	)	$	(.71	)	$	(.99	)		55		$	(2.47	)	$	(1.35	)		(83	)
Diluted loss		(.45	)		(1.43	)		(.38	)		(2.20	)		(.99	)		55			(3.95	)		(1.35	)		(193	)
Cash dividends declared		—			—			—			—			—						—			.18
Stock dividends declared⁽⁶⁾		—		1 for 130			1 for 130			1 for 130			1 for 130						3 for 130			2 for 130
Book value		8.36			8.85			13.87			14.70			16.95			(51	)		8.36			16.95			(51	)
Tangible book value⁽⁴⁾		6.02			6.50			8.85			9.65			10.39			(42	)		6.02			10.39			(42	)
Key performance ratios:
Return on equity⁽³⁾⁽⁵⁾		(22.08	)%		(45.52	)%		(11.42	)%		(58.28	)%		(23.83	)%					(34.40	)%		(7.82	)%
Return on assets⁽⁵⁾		(1.91	)		(3.32	)		(.78	)		(5.03	)		(2.19	)					(2.76	)		(.76	)
Net interest margin⁽⁵⁾		3.40			3.39			3.28			3.08			2.70						3.29			3.18
Operating efficiency ratio⁽¹⁾⁽²⁾		79.02			69.15			74.15			75.15			81.34						74.37			70.49
Equity to assets		11.94			10.27			10.71			11.56			10.04						11.12			10.22
Tangible equity to assets⁽⁴⁾		9.53			7.55			7.96			8.24			6.56						8.33			6.67
Tangible common equity to assets⁽⁴⁾		7.37			5.36			5.77			6.09			6.21						6.15			6.57
Tangible common equity to risk-weighted assets⁽⁴⁾		10.39			10.67			7.49			8.03			8.34						10.39			8.34
ASSET QUALITY *
Non-performing loans (NPLs)	$	264,092		$	304,381		$	287,848		$	259,155		$	190,723					$	264,092		$	190,723
Foreclosed properties		120,770			110,610			104,754			75,383			59,768						120,770			59,768

Total non-performing assets (NPAs)		384,862			414,991			392,602			334,538			250,491						384,862			250,491
Allowance for loan losses		155,602			150,187			145,678			143,990			122,271						155,602			122,271
Net charge-offs		84,585			90,491			58,312			43,281			74,028						276,669			151,152
Allowance for loan losses to loans		3.02	%		2.80	%		2.64	%		2.56	%		2.14	%					3.02	%		2.14	%
Net charge-offs to average loans⁽⁵⁾		6.37			6.57			4.18			3.09			5.09						5.03			2.57
NPAs to loans and foreclosed properties		7.30			7.58			6.99			5.86			4.35						7.30			4.35
NPAs to total assets		4.81			4.91			4.63			4.09			2.92						4.81			2.92
AVERAGE BALANCES
Loans	$	5,357,150		$	5,565,498		$	5,597,259		$	5,675,054		$	5,784,139			(7	)	$	5,547,915		$	5,890,889			(6	)
Investment securities		1,528,805			1,615,499			1,771,482			1,712,654			1,508,808			1			1,656,492			1,489,036			11
Earning assets		7,486,790			7,400,539			7,442,178			7,530,230			7,662,536			(2	)		7,464,639			7,504,186			(1	)
Total assets		8,286,544			8,208,199			8,212,140			8,372,281			8,487,017			(2	)		8,269,387			8,319,201			(1	)
Deposits		6,835,052			6,689,948			6,544,537			6,780,531			6,982,229			(2	)		6,712,605			6,524,457			3
Shareholders’ equity		989,279			843,130			879,210			967,505			851,956			16			919,631			850,426			8
Common shares — basic		94,219			49,771			48,794			48,324			47,844						60,374			47,369
Common shares — diluted		94,219			49,771			48,794			48,324			47,844						60,374			47,369
AT PERIOD END
Loans	$	5,151,476		$	5,362,689		$	5,513,087		$	5,632,705		$	5,704,861			(10	)	$	5,151,476		$	5,704,861			(10	)
Investment securities		1,530,047			1,532,514			1,816,787			1,719,033			1,617,187			(5	)		1,530,047			1,617,187			(5	)
Total assets		7,999,914			8,443,617			8,477,355			8,171,663			8,591,933			(7	)		7,999,914			8,591,933			(7	)
Deposits		6,627,834			6,821,306			6,848,760			6,616,488			7,003,624			(5	)		6,627,834			7,003,624			(5	)
Shareholders’ equity		962,321			1,006,638			855,272			888,853			989,382			(3	)		962,321			989,382			(3	)
Common shares outstanding		94,046			93,901			48,933			48,487			48,009						94,046			48,009


⁽¹⁾		Excludes the gain from acquisition of $11.4 million, net of income tax expense of $4.3 million in the second quarter of 2009.

⁽²⁾		Excludes the goodwill impairment charges of $25 million and $70 million in the third and first quarters of 2009, respectively, and severance costs of $2.9 million, net of income tax benefit of $1.1 million in the first quarter of 2009.

⁽³⁾		Net loss available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss).

⁽⁴⁾		Excludes effect of acquisition related intangibles and associated amortization.

⁽⁵⁾		Annualized.

⁽⁶⁾		Number of new shares issued for shares currently held.

^{NM —}		Not meaningful.

*		Excludes loans and foreclosed properties covered by loss sharing agreements with the FDIC.

UNITED COMMUNITY BANKS, INC.
Selected Financial Information
For the Years Ended December 31,


(in thousands, except per share data;
taxable equivalent)	2009			2008			2007			2006			2005
INCOME SUMMARY
Net interest revenue	$	245,227		$	238,704		$	274,483		$	237,880		$	196,799
Provision for loan losses ⁽¹⁾		310,000			184,000			37,600			14,600			12,100
Operating fee revenue ⁽²⁾		58,788			53,141			62,651			49,095			46,148

Total operating revenue ⁽¹⁾⁽²⁾		(5,985	)		107,845			299,534			272,375			230,847
Operating expenses ⁽³⁾		224,055			206,699			190,061			162,070			140,808

Operating (loss) income before taxes		(230,040	)		(98,854	)		109,473			110,305			90,039
Operating income taxes		(91,448	)		(35,404	)		40,482			41,490			33,297

Net operating (loss) income		(138,592	)		(63,450	)		68,991			68,815			56,742
Gain from acquisition, net of tax		7,062			—			—			—			—
Noncash goodwill impairment charge		(95,000	)		—			—			—			—
Severance cost, net of tax benefit		(1,797	)		—			—			—			—
Fraud loss provision, net of tax benefit		—			—			(10,998	)		—			—

Net (loss) income		(228,327	)		(63,450	)		57,993			68,815			56,742
Preferred dividends and discount accretion		10,242			724			18			19			23

Net (loss) income available to common shareholders	$	(238,569	)	$	(64,174	)	$	57,975		$	68,796		$	56,719


PERFORMANCE MEASURES
Per common share:
Diluted operating (loss) earnings ^(1)(2)(3)	$	(2.47	)	$	(1.35	)	$	1.48		$	1.66		$	1.43
Diluted (loss) earnings		(3.95	)		(1.35	)		1.24			1.66			1.43
Cash dividends declared (rounded)		—			.18			.36			.32			.28
Stock dividends declared⁽⁶⁾	3 for 130			2 for 130				—			—			—
Book value		8.36			16.95			17.73			14.37			11.80
Tangible book value⁽⁵⁾		6.02			10.39			10.94			10.57			8.94
Key performance ratios:
Return on equity ⁽⁴⁾		(34.40	)%		(7.82	)%		7.79	%		13.28	%		13.46	%
Return on assets		(2.76	)		(.76	)		.75			1.09			1.04
Net interest margin		3.29			3.18			3.88			4.05			3.85
Operating efficiency ratio ⁽²⁾⁽³⁾		74.37			70.49			56.53			56.35			57.77
Equity to assets		11.12			10.22			9.61			8.06			7.63
Tangible equity to assets ⁽⁵⁾		8.33			6.67			6.63			6.32			5.64
Tangible common equity to assets ⁽⁵⁾		6.15			6.57			6.63			6.32			5.64
Tangible common equity to risk-weighted assets⁽⁵⁾		10.39			8.34			8.21			8.09			7.75

ASSET QUALITY *
Non-performing loans (NPLs)	$	264,092		$	190,723		$	28,219		$	12,458		$	11,997
Foreclosed properties		120,770			59,768			18,039			1,196			998

Total non-performing assets (NPAs)		384,862			250,491			46,258			13,654			12,995
Allowance for loan losses		155,602			122,271			89,423			66,566			53,595
Operating net charge-offs⁽¹⁾		276,669			151,152			21,834			5,524			5,701
Allowance for loan losses to loans		3.02	%		2.14	%		1.51	%		1.24	%		1.22	%
Operating net charge-offs to average loans⁽¹⁾		5.03			2.57			.38			.12			.14
NPAs to loans and foreclosed properties		7.30			4.35			.78			.25			.30
NPAs to total assets		4.81			2.92			.56			.19			.22

AVERAGE BALANCES
Loans	$	5,547,915		$	5,890,889		$	5,734,608		$	4,800,981		$	4,061,091
Investment securities		1,656,492			1,489,036			1,277,935			1,041,897			989,201
Earning assets		7,464,639			7,504,186			7,070,900			5,877,483			5,109,053
Total assets		8,269,387			8,319,201			7,730,530			6,287,148			5,472,200
Deposits		6,712,605			6,524,457			6,028,625			5,017,435			4,003,084
Shareholders’ equity		919,631			850,426			742,771			506,946			417,309
Common shares — Basic		60,374			47,369			45,948			40,413			38,477
Common shares — Diluted		60,374			47,369			46,593			41,575			39,721

AT YEAR END
Loans	$	5,151,476		$	5,704,861		$	5,929,263		$	5,376,538		$	4,398,286
Investment securities		1,530,047			1,617,187			1,356,846			1,107,153			990,687
Total assets		7,999,914			8,591,933			8,207,302			7,101,249			5,865,756
Deposits		6,627,834			7,003,624			6,075,951			5,772,886			4,477,600
Shareholders’ equity		962,321			989,382			831,902			616,767			472,686
Common shares outstanding		94,046			48,009			46,903			42,891			40,020


⁽¹⁾		Excludes pre-tax provision for fraud-related loan losses and related charge-offs of $18 million, net of income tax benefit of $7 million in 2007.

⁽²⁾		Excludes the gain from acquisition of $11.4 million, net of income tax expense of $4.3 million in 2009.

⁽³⁾		Excludes the goodwill impairment charge of $95 million and severance costs of $2.9 million, net of income tax benefit of $1.1 million in 2009.

⁽⁴⁾		Net (loss) 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).

⁽⁵⁾		Excludes effect of acquisition related intangibles and associated amortization.

⁽⁶⁾		Number of new shares issued for shares currently held.

NM —		Not meaningful.

*		Excludes loans and foreclosed properties covered by loss sharing agreements with the FDIC.

UNITED COMMUNITY BANKS, INC.
Operating Earnings to GAAP Earnings Reconciliation
Selected Financial Information


	2009												2008			For the Twelve
(in thousands, except per share	Fourth			Third			Second			First			Fourth			Months Ended
data; taxable equivalent)	Quarter			Quarter			Quarter			Quarter			Quarter			2009			2008			2007			2006			2005

Interest revenue reconciliation
Interest revenue — taxable equivalent	$	97,481		$	101,181		$	102,737		$	103,562		$	108,434		$	404,961		$	466,969		$	550,917		$	446,695		$	324,225
Taxable equivalent adjustment		(601	)		(580	)		(463	)		(488	)		(553	)		(2,132	)		(2,261	)		(1,881	)		(1,868	)		(1,636	)

Interest revenue (GAAP)	$	96,880		$	100,601		$	102,274		$	103,074		$	107,881		$	402,829		$	464,708		$	549,036		$	444,827		$	322,589


Net interest revenue reconciliation
Net interest revenue — taxable equivalent	$	63,929		$	63,004		$	60,882		$	57,412		$	51,873		$	245,227		$	238,704		$	274,483		$	237,880		$	196,799
Taxable equivalent adjustment		(601	)		(580	)		(463	)		(488	)		(553	)		(2,132	)		(2,261	)		(1,881	)		(1,868	)		(1,636	)

Net interest revenue (GAAP)	$	63,328		$	62,424		$	60,419		$	56,924		$	51,320		$	243,095		$	236,443		$	272,602		$	236,012		$	195,163


Provision for loan losses reconciliation
Operating provision for loan losses	$	90,000		$	95,000		$	60,000		$	65,000		$	85,000		$	310,000		$	184,000		$	37,600		$	14,600		$	12,100
Special fraud-related provision for loan losses		—			—			—			—			—			—			—			18,000			—			—

Provision for loan losses (GAAP)	$	90,000		$	95,000		$	60,000		$	65,000		$	85,000		$	310,000		$	184,000		$	55,600		$	14,600		$	12,100


Fee revenue reconciliation
Operating fee revenue	$	17,221		$	15,671		$	13,050		$	12,846		$	10,718		$	58,788		$	53,141		$	62,651		$	49,095		$	46,148
Gain from acquisition		—			—			11,390			—			—			11,390			—			—			—			—

Fee revenue (GAAP)	$	17,221		$	15,671		$	24,440		$	12,846		$	10,718		$	70,178		$	53,141		$	62,651		$	49,095		$	46,148


Total revenue reconciliation
Total operating revenue	$	(8,850	)	$	(16,325	)	$	13,932		$	5,258		$	(22,409	)	$	(5,985	)	$	107,845		$	299,534		$	272,375		$	230,847
Taxable equivalent adjustment		(601	)		(580	)		(463	)		(488	)		(553	)		(2,132	)		(2,261	)		(1,881	)		(1,868	)		(1,636	)
Gain from acquisition		—			—			11,390			—			—			11,390			—			—			—			—
Special fraud-related provision for loan losses		—			—			—			—			—			—			—			(18,000	)		—			—

Total revenue (GAAP)	$	(9,451	)	$	(16,905	)	$	24,859		$	4,770		$	(22,962	)	$	3,273		$	105,584		$	279,653		$	270,507		$	229,211


Expense reconciliation
Operating expense	$	62,532		$	53,606		$	55,348		$	52,569		$	52,439		$	224,055		$	206,699		$	190,061		$	162,070		$	140,808
Noncash goodwill impairment charge		—			25,000			—			70,000			—			95,000			—			—			—			—
Severance costs		—			—			—			2,898			—			2,898			—			—			—			—

Operating expense (GAAP)	$	62,532		$	78,606		$	55,348		$	125,467		$	52,439		$	321,953		$	206,699		$	190,061		$	162,070		$	140,808


(Loss) income before taxes reconciliation
Operating (loss) income before taxes	$	(71,382	)	$	(69,931	)	$	(41,416	)	$	(47,311	)	$	(74,848	)	$	(230,040	)	$	(98,854	)	$	109,473		$	110,305		$	90,039
Taxable equivalent adjustment		(601	)		(580	)		(463	)		(488	)		(553	)		(2,132	)		(2,261	)		(1,881	)		(1,868	)		(1,636	)
Gain from acquisition		—			—			11,390			—			—			11,390			—			—			—			—
Noncash goodwill impairment charge		—			(25,000	)		—			(70,000	)		—			(95,000	)		—			—			—			—
Severance costs		—			—			—			(2,898	)		—			(2,898	)		—			—			—			—
Special fraud-related provision for loan losses		—			—			—			—			—			—			—			(18,000	)		—			—

(Loss) income before taxes (GAAP)	$	(71,983	)	$	(95,511	)	$	(30,489	)	$	(120,697	)	$	(75,401	)	$	(318,680	)	$	(101,115	)	$	89,592		$	108,437		$	88,403


Income tax (benefit) expense reconciliation
Operating income tax (benefit) expense	$	(31,547	)	$	(26,213	)	$	(18,353	)	$	(15,335	)	$	(28,101	)	$	(91,448	)	$	(35,404	)	$	40,482		$	41,490		$	33,297
Taxable equivalent adjustment		(601	)		(580	)		(463	)		(488	)		(553	)		(2,132	)		(2,261	)		(1,881	)		(1,868	)		(1,636	)
Gain from acquisition, tax expense		—			—			4,328			—			—			4,328			—			—			—			—
Severance costs, tax benefit		—			—			—			(1,101	)		—			(1,101	)		—			—			—			—
Special fraud-related provision for loan losses		—			—			—			—			—			—			—			(7,002	)		—			—

Income tax (benefit) expense (GAAP)	$	(32,148	)	$	(26,793	)	$	(14,488	)	$	(16,924	)	$	(28,654	)	$	(90,353	)	$	(37,665	)	$	31,599		$	39,622		$	31,661


(Loss) earnings per common share reconciliation
Operating (loss) earnings per common share	$	(.45	)	$	(.93	)	$	(.53	)	$	(.71	)	$	(.99	)	$	(2.47	)	$	(1.35	)	$	1.48		$	1.66		$	1.43
Gain from acquisition		—			—			.15			—			—			.12			—			—			—			—
Noncash goodwill impairment charge		—			(.50	)		—			(1.45	)		—			(1.57	)		—			—			—			—
Severance costs		—			—			—			(.04	)		—			(.03	)		—			—			—			—
Special fraud-related provision for loan losses		—			—			—			—			—			—			—			(.24	)		—			—

(Loss) earnings per common share (GAAP)	$	(.45	)	$	(1.43	)	$	(.38	)	$	(2.20	)	$	(.99	)	$	(3.95	)	$	(1.35	)	$	1.24		$	1.66		$	1.43


Book value reconciliation
Tangible book value	$	6.02		$	6.50		$	8.85		$	9.65		$	10.39		$	6.02		$	10.39		$	10.94		$	10.57		$	8.94
Effect of goodwill and other intangibles		2.34			2.35			5.02			5.05			6.56			2.34			6.56			6.79			3.80			2.86

Book value (GAAP)	$	8.36		$	8.85		$	13.87		$	14.70		$	16.95		$	8.36		$	16.95		$	17.73		$	14.37		$	11.80


Efficiency ratio reconciliation
Operating efficiency ratio		79.02	%		69.15	%		74.15	%		75.15	%		81.34	%		74.37	%		70.49	%		56.53	%		56.35	%		57.77	%
Gain from acquisition		—			—			(9.82	)		—			—			(2.71	)		—			—			—			—
Noncash goodwill impairment charge		—			32.24			—			100.06			—			30.39			—			—			—			—
Severance costs		—			—			—			4.14			—			.93			—			—			—			—

Efficiency ratio (GAAP)		79.02	%		101.39	%		64.33	%		179.35	%		81.34	%		102.98	%		70.49	%		56.53	%		56.35	%		57.77	%


Average equity to assets reconciliation
Tangible common equity to assets		7.37	%		5.36	%		5.77	%		6.09	%		6.21	%		6.15	%		6.57	%		6.63	%		6.32	%		5.64	%
Effect of preferred equity		2.16			2.19			2.19			2.15			.35			2.18			.10			—			—			—

Tangible equity to assets		9.53			7.55			7.96			8.24			6.56			8.33			6.67			6.63			6.32			5.64
Effect of goodwill and other intangibles		2.41			2.72			2.75			3.32			3.48			2.79			3.55			2.98			1.74			1.99

Equity to assets (GAAP)		11.94	%		10.27	%		10.71	%		11.56	%		10.04	%		11.12	%		10.22	%		9.61	%		8.06	%		7.63	%


Actual tangible common equity to risk-weighted assets reconciliation
Tangible common equity to risk-weighted assets		10.39	%		10.67	%		7.49	%		8.03	%		8.34	%		10.39	%		8.34	%		8.21	%		8.09	%		7.75	%
Effect of other comprehensive income		(.87	)		(.90	)		(.72	)		(1.00	)		(.91	)		(.87	)		(.91	)		(.23	)		.07			.23
Effect of deferred tax limitation		(1.27	)		(.58	)		(.22	)		—			—			(1.27	)		—			—			—			—
Effect of trust preferred		.97			.92			.90			.89			.88			.97			.88			.65			.81			.89
Effect of preferred equity		3.19			3.04			2.99			2.96			2.90			3.19			2.90			—			.01			.01

Tier I capital ratio (Regulatory)		12.41	%		13.15	%		10.44	%		10.88	%		11.21	%		12.41	%		11.21	%		8.63	%		8.98	%		8.88	%


Net charge-offs reconciliation
Operating net charge-offs	$	84,585		$	90,491		$	58,312		$	43,281		$	74,028		$	276,669		$	151,152		$	21,834		$	5,524		$	5,701
Fraud related charge-offs		—			—			—			—			—			—			—			18,000			—			—

Net charge-offs (GAAP)	$	84,585		$	90,491		$	58,312		$	43,281		$	74,028		$	276,669		$	151,152		$	39,834		$	5,524		$	5,701


Net charge-offs to average loans reconciliation
Operating net charge-offs to average loans		6.37	%		6.57	%		4.18	%		3.09	%		5.09	%		5.03	%		2.57	%		.38	%		.12	%		.14	%
Effect of fraud related charge offs		—			—			—			—			—			—			—			.31			—			—

Net charge-offs to average loans (GAAP)		6.37	%		6.57	%		4.18	%		3.09	%		5.09	%		5.03	%		2.57	%		.69	%		.12	%		.14	%

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End


											Linked			Year over
	2009								2008		Quarter			Year
	Fourth		Third		Second		First		Fourth		Change⁽²⁾			Change
(in millions)	Quarter⁽¹⁾		Quarter⁽¹⁾		Quarter⁽¹⁾		Quarter		Quarter		Actual			Actual
LOANS BY CATEGORY
Commercial (sec. by RE)	$	1,779	$	1,787	$	1,797	$	1,779	$	1,627		(2	)%		9	%
Commercial construction		363		380		379		377		500		(18	)		(27	)
Commercial & industrial		390		403		399		387		410		(13	)		(5	)

Total commercial		2,532		2,570		2,575		2,543		2,537		(6	)		—
Residential construction		1,050		1,185		1,315		1,430		1,479		(46	)		(29	)
Residential mortgage		1,427		1,461		1,470		1,504		1,526		(9	)		(6	)
Consumer / installment		142		147		153		156		163		(14	)		(13	)

Total loans	$	5,151	$	5,363	$	5,513	$	5,633	$	5,705		(16	)		(10	)


LOANS BY MARKET
Atlanta MSA	$	1,435	$	1,526	$	1,605	$	1,660	$	1,706		(24	)%		(16	)%
Gainesville MSA		390		402		413		422		420		(12	)		(7	)
North Georgia		1,884		1,942		1,978		2,014		2,040		(12	)		(8	)
Western North Carolina		772		786		794		808		810		(7	)		(5	)
Coastal Georgia		405		440		455		460		464		(32	)		(13	)
East Tennessee		265		267		268		269		265		(3	)		—

Total loans	$	5,151	$	5,363	$	5,513	$	5,633	$	5,705		(16	)		(10	)


RESIDENTIAL CONSTRUCTION
Dirt loans
Acquisition & development	$	332	$	380	$	413	$	445	$	484		(51	)%		(31	)%
Land loans		127		159		159		155		153		(81	)		(17	)
Lot loans		336		336		369		390		358		—			(6	)

Total		795		875		941		990		995		(37	)		(20	)


House loans
Spec		178		218		268		317		347		(73	)%		(49	)%
Sold		77		92		106		123		137		(65	)		(44	)

Total		255		310		374		440		484		(71	)		(47	)

Total residential construction	$	1,050	$	1,185	$	1,315	$	1,430	$	1,479		(46	)		(29	)


RESIDENTIAL CONSTRUCTION — ATLANTA MSA
Dirt loans
Acquisition & development	$	76	$	100	$	124	$	148	$	167		(96	)%		(54	)%
Land loans		43		61		63		52		56		(118	)		(23	)
Lot loans		52		54		81		98		86		(15	)		(40	)

Total		171		215		268		298		309		(82	)		(45	)


House loans
Spec		68		91		127		164		189		(101	)%		(64	)%
Sold		16		22		29		33		40		(109	)		(60	)

Total		84		113		156		197		229		(103	)		(63	)

Total residential construction	$	255	$	328	$	424	$	495	$	538		(89	)		(53	)


(1)		Excludes total loans of $85.1 million, $104.0 million and $109.9 million as of December 31, 2009, September 30, 2009 and June 30, 2009, respectively, that are covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.

(2)		Annualized.

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Year-End


(in millions)	2009		2008		2007		2006		2005		2004
LOANS BY CATEGORY
Commercial (sec. by RE)	$	1,779	$	1,627	$	1,476	$	1,230	$	1,055	$	967
Commercial construction		363		500		527		469		359		249
Commercial & industrial		390		410		418		296		237		212

Total commercial		2,532		2,537		2,421		1,995		1,651		1,428
Residential construction		1,050		1,479		1,829		1,864		1,380		1,055
Residential mortgage		1,427		1,526		1,502		1,338		1,206		1,102
Consumer / installment		142		163		177		180		161		150

Total loans	$	5,151	$	5,705	$	5,929	$	5,377	$	4,398	$	3,735


LOANS BY MARKET
Atlanta MSA	$	1,435	$	1,706	$	2,002	$	1,651	$	1,207	$	1,061
Gainesville MSA		390		420		399		354		249		—
North Georgia		1,884		2,040		2,060		2,034		1,790		1,627
Western North Carolina		772		810		806		773		668		633
Coastal Georgia		405		464		416		358		306		274
East Tennessee		265		265		246		207		178		140

Total loans	$	5,151	$	5,705	$	5,929	$	5,377	$	4,398	$	3,735

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality ⁽¹⁾


	Fourth Quarter 2009									Third Quarter 2009									Second Quarter 2009
	Non-performing			Foreclosed			Total			Non-performing			Foreclosed			Total			Non-performing			Foreclosed			Total
(in thousands)	Loans			Properties			NPAs			Loans			Properties			NPAs			Loans			Properties			NPAs
NPAs BY CATEGORY
Commercial (sec. by RE)	$	37,040		$	15,842		$	52,882		$	38,379		$	12,566		$	50,945		$	37,755		$	5,395		$	43,150
Commercial construction		19,976			9,761			29,737			38,505			5,543			44,048			15,717			5,847			21,564
Commercial & industrial		3,946			—			3,946			3,794			—			3,794			11,378			—			11,378

Total commercial		60,962			25,603			86,565			80,678			18,109			98,787			64,850			11,242			76,092
Residential construction		142,332			76,519			218,851			171,027			79,045			250,072			176,400			81,648			258,048
Residential mortgage		58,767			18,648			77,415			50,626			13,456			64,082			44,256			11,864			56,120
Consumer / installment		2,031			—			2,031			2,050			—			2,050			2,342			—			2,342

Total NPAs	$	264,092		$	120,770		$	384,862		$	304,381		$	110,610		$	414,991		$	287,848		$	104,754		$	392,602


NPAs BY MARKET
Atlanta MSA	$	106,536		$	41,125		$	147,661		$	120,599		$	54,670		$	175,269		$	148,155		$	50,450		$	198,605
Gainesville MSA		5,074			2,614			7,688			12,916			8,429			21,345			9,745			3,511			13,256
North Georgia		87,598			53,072			140,670			96,373			36,718			133,091			72,174			37,454			109,628
Western North Carolina		29,610			5,096			34,706			25,775			5,918			31,693			21,814			7,245			29,059
Coastal Georgia		26,871			17,150			44,021			38,414			3,045			41,459			30,311			3,904			34,215
East Tennessee		8,403			1,713			10,116			10,304			1,830			12,134			5,649			2,190			7,839

Total NPAs	$	264,092		$	120,770		$	384,862		$	304,381		$	110,610		$	414,991		$	287,848		$	104,754		$	392,602


NPA ACTIVITY
Beginning Balance	$	304,381		$	110,610		$	414,991		$	287,848		$	104,754		$	392,602		$	259,155		$	75,383		$	334,538
Loans placed on non-accrual		174,898			—			174,898			190,164			—			190,164			169,351			—			169,351
Payments received		(26,935	)		—			(26,935	)		(16,597	)		—			(16,597	)		(15,597	)		—			(15,597	)
Loan charge-offs		(88,427	)		—			(88,427	)		(92,359	)		—			(92,359	)		(60,644	)		—			(60,644	)
Foreclosures		(79,983	)		79,983			—			(56,624	)		56,624			—			(64,417	)		64,417			—
Capitalized costs		—			981			981			—			579			579			—			1,324			1,324
Note / property sales		(19,842	)		(61,228	)		(81,070	)		(8,051	)		(47,240	)		(55,291	)		—			(33,752	)		(33,752	)
Write downs		—			(2,209	)		(2,209	)		—			(1,906	)		(1,906	)		—			(2,738	)		(2,738	)
Net gains (losses) on sales		—			(7,367	)		(7,367	)		—			(2,201	)		(2,201	)		—			120			120

Ending Balance	$	264,092		$	120,770		$	384,862		$	304,381		$	110,610		$	414,991		$	287,848		$	104,754		$	392,602


	Fourth Quarter 2009					Third Quarter 2009					Second Quarter 2009
			Net Charge-					Net Charge-					Net Charge-
			Offs to					Offs to					Offs to
	Net		Average			Net		Average			Net		Average
(in thousands)	Charge-Offs		Loans⁽²⁾			Charge-Offs		Loans⁽²⁾			Charge-Offs		Loans⁽²⁾
NET CHARGE-OFFS BY CATEGORY
Commercial (sec. by RE)	$	3,896		.86	%	$	10,568		2.33	%	$	5,986		1.34	%
Commercial construction		4,717		5.03			4,369		4.55			756		.80
Commercial & industrial		153		.15			1,792		1.76			3,107		3.16

Total commercial		8,766		1.36			16,729		2.57			9,849		1.54
Residential construction		67,393		23.87			67,520		21.31			44,240		12.90
Residential mortgage		7,026		1.93			5,051		1.36			3,526		.95
Consumer / installment		1,400		3.83			1,191		3.13			697		1.80

Total	$	84,585		6.37		$	90,491		6.57		$	58,312		4.18


NET CHARGE-OFFS BY MARKET
Atlanta MSA	$	43,595		12.07	%	$	50,129		12.61	%	$	37,473		8.89	%
Gainesville MSA		2,273		2.49			1,473		1.60			4,125		4.38
North Georgia		18,057		3.57			24,017		4.74			12,571		2.52
Western North Carolina		10,091		5.11			3,949		1.98			1,015		.51
Coastal Georgia		8,109		7.72			10,051		8.78			969		.85
East Tennessee		2,460		3.67			872		1.30			2,159		3.21

Total	$	84,585		6.37		$	90,491		6.57		$	58,312		4.18


(1)		Excludes non-performing loans and foreclosed properties covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank. (2) Annualized.

UNITED COMMUNITY BANKS, INC.
Consolidated Statement of Income (Unaudited)


	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
(in thousands, except per share data)	2009			2008			2009			2008


Interest revenue:
Loans, including fees	$	78,064		$	86,409		$	322,509		$	385,959
Investment securities, including tax exempt of $366, $324, $1,322 and $1,464		17,313			18,964			77,370			75,869
Federal funds sold, commercial paper, deposits in banks and other		1,503			2,508			2,950			2,880

Total interest revenue		96,880			107,881			402,829			464,708

Interest expense:
Deposits:
NOW		2,315			6,045			11,023			28,626
Money market		2,328			3,124			9,545			10,643
Savings		105			204			483			764
Time		24,026			41,512			120,326			158,268

Total deposit interest expense		28,774			50,885			141,377			198,301
Federal funds purchased, repurchase agreements and other short-term borrowings		1,081			445			2,842			7,699
Federal Home Loan Bank advances		1,045			2,358			4,622			13,026
Long-term debt		2,652			2,873			10,893			9,239

Total interest expense		33,552			56,561			159,734			228,265

Net interest revenue		63,328			51,320			243,095			236,443
Provision for loan losses		90,000			85,000			310,000			184,000

Net interest revenue after provision for loan losses		(26,672	)		(33,680	)		(66,905	)		52,443

Fee revenue:
Service charges and fees		8,257			7,742			30,986			31,683
Mortgage loan and other related fees		1,651			1,528			8,959			7,103
Consulting fees		2,774			1,260			7,822			7,046
Brokerage fees		443			645			2,085			3,457
Securities gains, net		2,015			838			2,756			1,315
Gain from acquisition		—			—			11,390			—
Losses on prepayment of borrowings		—			(2,714	)		—			(2,714	)
Other		2,081			1,419			6,180			5,251

Total fee revenue		17,221			10,718			70,178			53,141

Total revenue		(9,451	)		(22,962	)		3,273			105,584

Operating expenses:
Salaries and employee benefits		26,189			24,441			108,967			110,574
Communications and equipment		3,932			3,897			15,038			15,490
Occupancy		4,038			3,663			15,796			14,988
Advertising and public relations		1,033			1,358			4,220			6,117
Postage, printing and supplies		1,315			1,763			5,068			6,296
Professional fees		2,571			2,313			9,925			7,509
Foreclosed property		14,391			5,238			32,365			19,110
FDIC assessments and other regulatory charges		3,711			1,980			16,004			6,020
Amortization of intangibles		813			745			3,104			3,009
Other		4,539			7,041			13,568			17,586
Goodwill impairment		—			—			95,000			—
Severance costs		—			—			2,898			—

Total operating expenses		62,532			52,439			321,953			206,699

Loss before income taxes		(71,983	)		(75,401	)		(318,680	)		(101,115	)
Income tax benefit		(32,148	)		(28,654	)		(90,353	)		(37,665	)

Net loss		(39,835	)		(46,747	)		(228,327	)		(63,450	)
Preferred stock dividends, including discount accretion		2,567			712			10,242			724

Net loss available to common shareholders	$	(42,402	)	$	(47,459	)	$	(238,569	)	$	(64,174	)

Basic loss per common share	$	(.45	)	$	(.99	)	$	(3.95	)	$	(1.35	)
Diluted loss per common share		(.45	)		(.99	)		(3.95	)		(1.35	)
Weighted average common shares outstanding — Basic		94,219			47,844			60,374			47,369
Weighted average common shares outstanding — Diluted		94,219			47,844			60,374			47,369

UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheet


	December 31,		December 31,
(in thousands, except share and per share data)	2009		2008

	(unaudited)		(audited)

ASSETS

Cash and due from banks	$	126,265	$	116,395
Interest-bearing deposits in banks		120,382		8,417
Federal funds sold, commercial paper and short-term investments		129,720		368,609

Cash and cash equivalents		376,367		493,421

Securities available for sale		1,530,047		1,617,187
Mortgage loans held for sale		30,226		20,334
Loans, net of unearned income		5,151,476		5,704,861
Less allowance for loan losses		155,602		122,271

Loans, net		4,995,874		5,582,590

Acquired assets covered by loss sharing agreements with the FDIC		185,938		—
Premises and equipment, net		182,038		179,160
Accrued interest receivable		33,867		46,088
Goodwill and other intangible assets		225,196		321,798
Other assets		440,361		331,355

Total assets	$	7,999,914	$	8,591,933

LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Deposits:
Demand	$	707,826	$	654,036
NOW		1,335,790		1,543,385
Money market		713,901		466,750
Savings		177,427		170,275
Time:
Less than $100,000		1,746,511		1,953,235
Greater than $100,000		1,187,499		1,422,974
Brokered		758,880		792,969

Total deposits		6,627,834		7,003,624

Federal funds purchased, repurchase agreements, and other short-term borrowings		101,389		108,411
Federal Home Loan Bank advances		114,501		235,321
Long-term debt		150,066		150,986
Accrued expenses and other liabilities		43,803		104,209

Total liabilities		7,037,593		7,602,551


Shareholders’ equity:
Preferred stock, $1 par value; 10,000,000 shares authorized;
Series A; $10 stated value; 21,700 and 25,800 shares issued and outstanding		217		258
Series B; $1,000 stated value; 180,000 shares issued and outstanding		174,408		173,180
Common stock, $1 par value; 100,000,000 shares authorized; 94,045,603 and 48,809,301 shares issued		94,046		48,809
Common stock issuable; 221,906 and 129,304 shares		3,597		2,908
Capital surplus		622,034		460,708
Retained earnings		20,384		265,405
Treasury stock; 799,892 shares, at cost		—		(16,465	)
Accumulated other comprehensive income		47,635		54,579

Total shareholders’ equity		962,321		989,382

Total liabilities and shareholders’ equity	$	7,999,914	$	8,591,933

UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended December 31,


	2009								2008
	Average					Avg.			Average					Avg.
(dollars in thousands, taxable equivalent)	Balance			Interest		Rate			Balance			Interest		Rate
Assets:
Interest-earning assets:
Loans, net of unearned income⁽¹⁾⁽²⁾	$	5,357,150		$	78,088		5.78	%	$	5,784,139		$	86,530		5.95	%
Taxable securities⁽³⁾		1,496,251			16,947		4.53			1,478,427			18,640		5.04
Tax-exempt securities⁽¹⁾⁽³⁾		32,554			599		7.36			30,381			530		6.98
Federal funds sold and other interest-earning assets		600,835			1,847		1.23			369,589			2,734		2.96

Total interest-earning assets		7,486,790			97,481		5.17			7,662,536			108,434		5.64

Non-interest-earning assets:
Allowance for loan losses		(162,203	)							(109,956	)
Cash and due from banks		107,153								116,463
Premises and equipment		182,790								179,807
Other assets⁽³⁾		672,014								638,167

Total assets	$	8,286,544							$	8,487,017


Liabilities and Shareholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW	$	1,334,578		$	2,315		.69		$	1,534,370		$	6,045		1.57
Money market		726,680			2,328		1.27			424,940			3,124		2.92
Savings		178,191			105		.23			174,186			204		.47
Time less than $100,000		1,812,823			10,952		2.40			1,916,811			18,524		3.84
Time greater than $100,000		1,215,579			8,074		2.64			1,448,818			14,558		4.00
Brokered		844,462			5,000		2.35			818,100			8,430		4.10

Total interest-bearing deposits		6,112,313			28,774		1.87			6,317,225			50,885		3.20

Federal funds purchased and other borrowings		105,130			1,081		4.08			109,712			445		1.61
Federal Home Loan Bank advances		156,979			1,045		2.64			284,860			2,358		3.29
Long-term debt		150,060			2,652		7.01			146,746			2,873		7.79

Total borrowed funds		412,169			4,778		4.60			541,318			5,676		4.17

Total interest-bearing liabilities		6,524,482			33,552		2.04			6,858,543			56,561		3.28

Non-interest-bearing liabilities:
Non-interest-bearing deposits		722,739								665,004
Other liabilities		50,044								111,514

Total liabilities		7,297,265								7,635,061
Shareholders’ equity		989,279								851,956

Total liabilities and shareholders’ equity	$	8,286,544							$	8,487,017

Net interest revenue				$	63,929							$	51,873

Net interest-rate spread							3.13	%							2.36	%

Net interest margin⁽⁴⁾							3.40	%							2.70	%


(1)		Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 39%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.

(2)		Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued.

(3)		Securities available for sale are shown at amortized cost. Pretax unrealized gains of $22.1 million in 2009 and pretax unrealized losses of $3.6 million in 2008 are included in other assets for purposes of this presentation.

(4)		Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.

UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Twelve Months Ended December 31,


	2009								2008
	Average					Avg.			Average					Avg.
(dollars in thousands, taxable equivalent)	Balance			Interest		Rate			Balance			Interest		Rate
Assets:
Interest-earning assets:
Loans, net of unearned income⁽¹⁾⁽²⁾	$	5,547,915		$	322,284		5.81	%	$	5,890,889		$	386,132		6.55	%
Taxable securities⁽³⁾		1,626,032			76,048		4.68			1,455,206			74,405		5.11
Tax-exempt securities⁽¹⁾⁽³⁾		30,460			2,164		7.10			33,830			2,406		7.11
Federal funds sold and other interest-earning assets		260,232			4,465		1.72			124,261			4,026		3.24

Total interest-earning assets		7,464,639			404,961		5.43			7,504,186			466,969		6.22

Non-interest-earning assets:
Allowance for loan losses		(146,535	)							(97,385	)
Cash and due from banks		105,127								131,778
Premises and equipment		180,381								180,857
Other assets⁽³⁾		665,775								599,765

Total assets	$	8,269,387							$	8,319,201


Liabilities and Shareholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW	$	1,297,139		$	11,023		.85		$	1,491,419		$	28,626		1.92
Money market		589,389			9,545		1.62			426,988			10,643		2.49
Savings		177,410			483		.27			182,067			764		.42
Time less than $100,000		1,891,774			56,811		3.00			1,724,036			71,844		4.17
Time greater than $100,000		1,306,302			42,518		3.25			1,457,397			62,888		4.32
Brokered		756,122			20,997		2.78			565,111			23,536		4.16

Total interest-bearing deposits		6,018,136			141,377		2.35			5,847,018			198,301		3.39

Federal funds purchased and other borrowings		177,589			2,842		1.60			324,634			7,699		2.37
Federal Home Loan Bank advances		220,468			4,622		2.10			410,605			13,026		3.17
Long-term debt		150,604			10,893		7.23			120,442			9,239		7.67

Total borrowed funds		548,661			18,357		3.35			855,681			29,964		3.50

Total interest-bearing liabilities		6,566,797			159,734		2.43			6,702,699			228,265		3.41

Non-interest-bearing liabilities:
Non-interest-bearing deposits		694,469								677,439
Other liabilities		88,490								88,637

Total liabilities		7,349,756								7,468,775
Shareholders’ equity		919,631								850,426

Total liabilities and shareholders’ equity	$	8,269,387							$	8,319,201

Net interest revenue				$	245,227							$	238,704

Net interest-rate spread							3.00	%							2.81	%

Net interest margin⁽⁴⁾							3.29	%							3.18	%


(1)		Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 39%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.

(2)		Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued.

(3)		Securities available for sale are shown at amortized cost. Pretax unrealized gains of $15.3 million in 2009 and $3.3 million in 2008 are included in other assets for purposes of this presentation.

(4)		Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.

EX-99.2

Exhibit 99.2

Investor Presentation Fourth Quarter 2009 David P. Shearrow Executive Vice President & CRO Rex S. Schuette Executive Vice President & CFO rex_schuette@ucbi.com (706) 781-2266 Jimmy C. Tallent President & CEO United Community Banks, Inc.

This presentation 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. 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 United Community Banks, Inc. Annual Report filed on Form 10-K with the Securities and Exchange Commission. This presentation also contains non-GAAP financial measures, as defined by the Federal Securities Laws. For a presentation of the most directly comparable financial measures calculated and presented in accordance with GAAP and a reconciliation of the differences between those measures and the non-GAAP financial measures, please refer to "Selected Financial Data" in the United Community Banks, Inc. Annual Report filed on Form 10-K and Quarterly Reports filed on Form 10- Q with the Securities Exchange Commission, which may be found on the company's Web site, www.ucbi.com. Cautionary statement 2

Non-GAAP measures This presentation also contains non-GAAP financial measures determined by methods other than in accordance with generally accepted accounting principles ("GAAP"). Such non-GAAP financial measures include the following: net interest margin - pre credit, core fee revenue, core operating expense, core earnings, net operating (loss) income and net operating (loss) earnings per share, tangible common equity to tangible assets, tangible equity to tangible assets and tangible common equity to risk-weighted assets. The most comparable GAAP measures to these measures are: net interest margin, fee revenue, operating expense, net (loss) income, diluted (loss) earnings per share and equity to assets. Management uses these non-GAAP financial measures because we believe it is useful for evaluating our operations and performance over periods of time, as well as in managing and evaluating our business and in discussions about our operations and performance. Management believes these non-GAAP financial measures provide users of our financial information with a meaningful measure for assessing our financial results and credit trends, as well as comparison to financial results for prior periods. These non-GAAP financial measures should not be considered as a substitute for financial measures determined in accordance with GAAP and may not be comparable to other similarly titled financial measures used by other companies. For a reconciliation of the differences between our non-GAAP financial measures and the most comparable GAAP measures, please refer to the 'Non-GAAP Reconcilement Tables' at the end of the Appendix of this presentation. We have not reconciled tangible common equity to tangible assets and core earnings to the extent such numbers are presented on a forward-looking basis based on management's internal stress test or SCAP methodology. Estimates that would be required for such reconciliations cannot reliably be produced without unreasonable effort. 3

United at a glance Assets $8.0 Billion Deposits $6.6 Billion Banks 27 Offices 107 4

Strengthened capital position 5

Deposit mix (total $6.6 billion) As of December 31, 2009 Demand & NOW MMDA & Sav. Time <$100k Time >$100k Public Funds Brokered East 1465 879 1740 1138 646 759 6

Core transaction deposits $ in millions 4Q 08 4Q 09 Geographic Diversity 7 Core transaction deposits Atlanta MSA North Georgia Western North Carolina Gainesville MSA Coastal Georgia Eastern Tennessee 4Q09 874 634 435 148 128 125 4Q08 747 599 395 126 120 99 Atlanta MSA North Georgia Western North Carolina Gainesville MSA Coastal Georgia Eastern Tennessee

Net interest margin 4Q 08 1Q 09 2Q 09 3Q09 4Q09 Net Interest Margin 0.027 0.0308 0.0328 0.0339 0.034 0.0043 0.0045 0.0052 0.0058 0.0064 Net Interest Margin Margin improvement 1 bps QTD 70 bps YTD Improved loan and deposit pricing Replaced higher priced CDs and money market Q4 Excess liquidity costs 18 bps vs. Q3 2009 NIM Characteristics 3.53% 3.80% 3.97% 4.04% NIM NIM - Pre Credit (1) (1) Excluding impact of nonaccrual loans, OREO and interest reversals 3.13% 8

LOAN PORTFOLIO AND CREDIT QUALITY 9

Proactively addressing credit environment Structure Centralized underwriting and approval process Segregated work-out teams Highly skilled ORE disposition group Seasoned regional credit professionals Process Continuous external loan review Intensive executive management involvement: Weekly past due meetings Weekly NPA/ORE meetings Quarterly criticized watch loan review meetings Quarterly pass commercial and CRE portfolio review meetings Internal loan review of new credit relationships Ongoing stress testing... commenced in 2007 Policy Ongoing enhancements to credit policy Periodic updates to portfolio limits 10

North Georgia Atlanta MSA Western North Carolina Coastal Georgia Gainesville MSA Eastern Tennessee East 0.36 0.28 0.15 0.08 0.08 0.05 Loan portfolio (total $5.2 billion) Geographic Diversity 11

Atlanta MSA North Georgia Western North Carolina Coastal Georgia Gainesville MSA Eastern Tennessee East 0.35 0.31 0.1 0.09 0.09 0.06 Commercial Construction Owner-Occupied Income Producing C & I East 14 38 32 15 Commercial loans (total $2.5 billion) Geographic Diversity Average Loan Size CRE: $443k C&I: $72k Comm. Constr. $672k 12

Commercial real estate (by loan type) 54% owner-occupied 46% income producing(1) Typical owner-occupied: small business, doctors, dentists, attorneys, CPAs $12 million project limit 63% LTV (1) $443k average loan size Portfolio Characteristics (1) Loan balance as of Dec 31, 2009 / most recent appraisal 13 (in millions) Dec 31, 2009 % of Loan Type Amount Total Office Buildings $ 401 23 % Small Businesses 395 21 Single-Unit Retail/Strip Centers 223 13 Small Warehouses/Storage 169 9 Churches 116 7 Hotels/Motels 120 7 Convenience Stores 86 5 Franchise / Restaurants 78 4 Multi-Residential Properties 66 4 Farmland 47 3 Multi-Unit Retail 42 2 Miscellaneous 36 2 Total Commercial Real Estate $ 1,779

Commercial construction (by loan type) Note: Dollars in millions $672k Average loan size Average LTVs (1) Raw Land: 47% Land Dev.: 47% Total: 50% Portfolio Characteristics (1) Loan balance as of December 31, 2009 / most recent appraisal 14 (in millions) Dec 31, 2009 % of Loan Type Amount Total Land Development - Vacant (Improved) 112 31 % Raw Land - Vacant (Unimproved) $ 107 29 Office Buildings 32 9 Retail Buildings 12 3 Churches 3 1 Miscellaneous 97 27 Total Commercial Construction $ 363

North Georgia Western North Carolina Atlanta MSA Coastal Georgia Gainesville MSA Eastern Tennessee East 0.39 0.26 0.14 0.08 0.07 0.06 Mortgage Home Equity East 74 26 Residential mortgage (total $1.4 billion) Geographic Diversity Avg loan size: $48k Avg loan size: $98k 15 Origination Characteristics No broker loans No sub-prime / Alt-A 78% of HE > 680 FICO Policy Max LTV: 80-85%

North Georgia Atlanta MSA Western North Carolina Coastal Georgia Gainesville MSA Eastern Tennessee East 0.48 0.24 0.15 0.06 0.05 0.02 Residential construction (total $1.0 billion) Geographic Diversity Developing Spec: $241k Sold: $152k Develop.: $825k Raw: $325k Lot: $142k Average Loan Size 16 Lot Spec Sold Developing Raw East 0.32 0.17 0.07 0.32 0.12 Construction Land

Atlanta MSA (residential construction) 17

Credit quality (in millions) 4Q 09 3Q 09 2Q 09 1Q 09 4Q 08 Net Charge-offs $ 84.6 $ 90.5 $ 58.3 $ 43.3 $ 74.0 as % of Average Loans 6.37 % 6.57 % 4.18 % 3.09 % 5.09 % Allowance for LL $ 155.6 $ 150.2 $ 145.7 $ 144.0 $ 122.3 as % of Total Loans 3.02 % 2.80 % 2.64 % 2.56 % 2.14 % as % of NPLs 59 49 51 56 64 as % of NPLs - Adjusted (1) 190 149 82 117 125 Past Due Loans (30 - 89 Days) 1.44 % 2.02 % 1.61 % 1.67 % 2.33 % Non-Performing Loans $ 264.1 $ 304.4 $ 287.8 $ 259.1 $ 190.7 OREO 120.8 110.6 104.8 75.4 59.8 Total NPAs $ 384.9 $ 415.0 $ 392.6 $ 334.5 $ 250.5 as % of Total Assets 4.81 % 4.91 % 4.63 % 4.09 % 2.92 % as % of Loans & OREO 7.30 7.58 6.99 5.86 4.35 (1) Excluding loans with no allocated reserve 18

Net charge-offs by loan category (1) Based on simple average of the four quarters 19

Net charge-offs by market Note: Dollars in thousands (1) Based on simple average of the four quarters 20

NPAs by loan category and market 21

Key trends - loan portfolio and credit quality Majority of credit challenges in 2009 centered in residential construction, primarily in Atlanta; this portfolio continues to decline rapidly which should lead to a reduction in credit losses going forward While some deterioration has occurred, the commercial portfolio continues to perform much better than residential construction; the commercial portfolio is highly diversified with low average balances and large percentage of owner-occupied Residential mortgage and HELOCs have been affected by unemployment. However, overall performance remains satisfactory given the economic environment The pace of ORE sales continued to accelerate in the 4th quarter and demand improved. ORE land sales in rural markets have been more challenging. 22

Imputed Stress Test - Estimated Credit Losses Through December 2010 (1) Represents the SCAP - Selected Banks Scenario modified to reflect the characteristics of United Community Banks existing loan portfolio. (2) Based on average projected losses per loan category (More Adverse Scenario) for BB&T Corporation, Fifth Third Bancorp, Regions Financial Corporation and SunTrust Banks, Inc. as per the Board of Governors of the Federal Reserve System (2009) "The Supervisory Capital Assessment Program: Overview of Results" (3) Represents the mid-point of the indicative loss rates by loan category as per the Board of Governors of the Federal Reserve System (2009) "The Supervisory Capital Assessment Program: Overview of Results" Credit quality - SCAP analysis 23

Imputed Stress Test - Projected Capital Ratios Credit quality - SCAP analysis 24

FINANCIAL RESULTS 25

Core earnings summary - Fourth Quarter 2009 (1) Excludes gain on sale of low income housing tax credits, FHLB prepayment charge, securities (losses) / gains, and gain on SCB acquisition (2) Excludes BOLI expense recovery, special FDIC assessment, foreclosed property costs, severance costs and goodwill impairment charges (3) Excluding impact of interest reversals, lost interest and carry costs of nonaccrual loans, OREO and interest reversals 26

Net operating loss - Fourth Quarter 2009 27

Net loss - Fourth Quarter 2009 28

Capital ratios (as percentages) Well- Capitalized 4Q 09 3Q 09 4Q 08 Regulatory Capital Tier 1 Risk-Based 6 % 12.4% 13.2% 11.2 % Total Risk-Based 10 15.1 15.8 13.9 Leverage 5 8.5 9.5 8.3 Tangible Equity to Risk-Weighted Assets 13.6 13.7 11.2 Tangible Common Equity to Risk-Weighted Assets 10.4 10.7 8.3 Tangible Equity to Assets 9.5 9.6* 6.6 Tangible Common Equity to Assets 7.4 7.4* 6.2 *Ratio as of quarter-end 29

APPENDIX 30

Joined UCBI Years in Banking Jimmy Tallent President and CEO 1984 36 Guy Freeman Chief Operating Officer 1994 49 Rex Schuette Chief Financial Officer 2001 32 David Shearrow Chief Risk Officer 2007 28 Glenn White President, Atlanta Region 2007 35 Craig Metz Marketing 2002 17 Bill Gilbert Retail Banking 2000 33 Experienced proven leadership 31

Business and operating model Twenty-seven "community banks" Local CEOs with deep roots in their communities Resources of $8.0 billion bank Service is point of differentiation Golden rule of banking "The Bank That SERVICE Built" Ongoing customer surveys +90% satisfaction rate Strategic footprint with substantial banking opportunities Operates in a number of the more demographically attractive markets in the U.S. Disciplined growth strategy Organic supported by de novos and selective acquisitions Community bank service, large bank resources 32

Population Growth (%) Population Growth (%) Markets1 Population (in thousands) Actual 2000 - 2009 Projected 2009 - 2014 North Georgia 396 24 10 Atlanta MSA 5,544 31 13 Gainesville MSA 187 34 15 Coastal Georgia 370 10 5 Western North Carolina 425 11 5 East Tennessee 850 13 6 Total Markets Georgia 9,933 21 9 North Carolina 9,370 16 8 Tennessee 6,297 11 5 United States 309,732 10 5 1 Population data is for 2009 and includes those markets where United takes deposits. Source: SNL Robust demographics (fast growing markets) 33

1 FDIC deposit market share and rank as of 6/09 for markets where United takes deposits. Source: SNL and FDIC Market share opportunities (excellent growth prospects) 34

Leading demographics 35

Small business market growth 2000 2006 Small Business Growth Population Growth 2000-2009 North Georgia 6,453 7,693 19% 24% Atlanta MSA 70,893 126,200 78% 31% Gainesville MSA 3,158 3,824 21% 34% Coastal Georgia 9,441 10,210 8% 10% Western North Carolina 10,274 11,544 12% 11% East Tennessee 16,273 17,839 10% 13% 1 Population data is for 2009, SNL; Business demographics, U.S. Census Statistics of U.S. Businesses, 2000 & 2006; County Business Patterns 2000-2006 The Atlanta MSA is seeing small business growth at nearly double its already significantly increasing population growth. Markets1 (# of business with 1 - 49 employees) 36

(in millions) 4Q 09 3Q 09 2Q 09 1Q 09 4Q 08 Year over Year % Change LOANS BY CATEGORY Commercial (sec. by RE) $1,779 $1,787 $1,797 $1,779 $1,627 9 Commercial construction 363 380 379 377 500 (27) Commercial & Industrial 390 403 399 387 410 (5) Total commercial 2,532 2,570 2,575 2,543 2,537 0 Residential construction 1,050 1,185 1,315 1,430 1,479 (29) Residential mortgage 1,427 1,461 1,470 1,504 1,526 (6) Consumer/installment 142 147 153 156 163 (13) TOTAL LOANS $5,151 $5,363 $5,513 $5,633 $5,705 (10) Business mix - loans (at quarter-end) 37

(in millions) 2009 2008 2007 2006 2005 LOANS BY CATEGORY Commercial (sec. by RE) $1,779 $1,627 $1,476 $1,230 $1,055 Commercial construction 363 500 527 469 359 Commercial & Industrial 390 410 418 296 237 Total commercial 2,532 2,537 2,421 1,995 1,651 Residential construction 1,050 1,479 1,829 1,864 1,380 Residential mortgage 1,427 1,526 1,502 1,338 1,206 Consumer/installment 142 163 177 180 161 TOTAL LOANS $5,151 $5,705 $5,929 $5,377 $4,398 Business mix - loans (at year-end) 38

(in millions) 4Q 09 3Q 09 2Q 09 1Q 09 4Q 08 Land Loans Developing Land $ 332 $ 380 $ 413 $ 445 $ 484 Raw Land 127 159 159 155 153 Lot Loans 336 336 369 390 358 Total 795 875 941 990 995 Construction Loans Spec 178 218 268 317 347 Sold 77 92 106 123 137 Total 255 310 374 440 484 Total Res Construction $1,050 $1,185 $1,315 $1,430 $1,479 Residential construction - total company 39

(in millions) 4Q 09 3Q 09 2Q 09 1Q 09 4Q 08 Land Loans Developing Land $ 76 $ 100 $ 124 $ 148 $ 167 Raw Land 43 61 63 52 56 Lot Loans 52 54 81 98 86 Total 171 215 268 298 309 Construction Loans Spec 68 91 127 164 189 Sold 16 22 29 33 40 Total 84 113 156 197 229 Total Res Construction $ 255 $ 328 $ 424 $ 495 $ 538 Residential construction - Atlanta MSA 40

(in millions) 4Q 09 3Q 09 2Q 09 1Q 09 4Q 08 LOANS BY MARKET Atlanta MSA $1,435 $1,526 $1,605 $1,660 $1,706 Gainesville MSA 390 402 413 422 420 North Georgia 1,884 1,942 1,978 2,014 2,040 Western North Carolina 772 786 794 808 810 Coastal Georgia 405 440 455 460 464 East Tennessee 265 267 268 269 265 Total loans $5,151 $5,363 $5,513 $5,633 $5,705 Loans - markets served (at quarter-end) 41

(in millions) 2009 2008 2007 2006 2005 LOANS BY MARKET Atlanta MSA $ 1,435 $ 1,706 $ 2,002 $ 1,651 $ 1,207 Gainesville MSA 390 420 400 354 249 North Georgia 1,884 2,040 2,060 2,034 1,790 Western North Carolina 772 810 806 773 668 Coastal Georgia 405 464 415 358 306 East Tennessee 265 265 246 207 178 Total loans $ 5,151 $ 5,705 $ 5,929 $ 5,377 $ 4,398 Loans - markets served (at year-end) 42

Legal lending limit $208 House lending limit 20 Top 25 relationships 7.9% of total loans 408 Regional credit review Standard underwriting Lending - credit summary (as of December 31, 2009) 43 (in millions)

NPAs by loan category, market, and activity 44

Net charge-offs by category and market 45

Liquidity - loans / deposits (in millions) Variance 4Q 09 3Q 09 4Q 08 vs 3Q 09 vs 4Q 08 Loans $ 5,151 $ 5,363 $ 5,705 $ (212 ) $ (554 ) Core (DDA, MMDA, Savings) $ 2,344 $ 2,340 $ 2,087 $ 4 $ 257 Public Funds 646 607 843 39 (197 ) CD's 2,879 3,035 3,281 (156 ) (402 ) Total Deposits (excl Brokered) $ 5,869 $ 5,982 $ 6,211 $ (113 ) $ (342 ) Loan to Deposit Ratio 88 % 90 % 92 % Investment Securities $ 1,530 $ 1,533 $ 1,617 $ (3 ) $ (87 ) Percent of Assets 19 % 18 % 19 % Commercial & Short-Term Paper $ 184 $ 397 $ 369 $ (213 ) $ (185 ) 46

Liquidity - wholesale borrowings (in millions) Unused Variance Capacity 4Q 09 3Q 09 4Q 08 vs 3Q 09 vs 4Q 08 Brokered Deposits $ 1,241 $ 759 $ 839 $ 793 $ (80 ) $ (34 ) FHLB 798 115 315 235 (200 ) (120 ) Fed Funds 100 - - 8 - (8 ) Other Wholesale 330 101 102 100 (1 ) 1 Total Wholesale $ 2,469 $ 975 $ 1,256 $ 1,136 $ (281 ) $ (161 ) Sub-Debt $ 96 $ 96 $ 97 $ - $ (1 ) Trust Preferred Securities 54 54 54 - - Total Long-Term Debt $ 150 $ 150 $ 151 $ - $ (1 ) 47

Business mix - deposits (at quarter-end) (in millions) DEPOSITS BY CATEGORY 4Q 09 3Q 09 2Q 09 1Q 09 4Q 08 Demand & NOW $ 1,465 $ 1,481 $ 1,523 $ 1,485 $ 1,457 MMDA & Savings 879 858 744 665 630 Core Transaction Deposits 2,344 2,339 2,267 2,150 2,087 Time < $100,000 1,740 1,848 1,985 1,904 1,945 Public Deposits 597 557 482 485 756 Total Core Deposits 4,681 4,744 4,734 4,539 4,788 Time > $100,000 1,138 1,187 1,293 1,275 1,336 Public Deposits 49 50 59 75 87 Total Customer Deposits 5,868 5,981 6,086 5,889 6,211 Brokered Deposits 759 ___840 763 727 793 Total Deposits 6,627 6,821 6,849 6,616 7,004 48

Analyst coverage 49 FBR Capital (Market Perform - Nov 20, 2009) Sandler O'Neill & Partners (Hold - Jan 5, 2010) FIG Partners (Outperform - Nov 9, 2009) Soleil (Tenner Investment Research) (Hold - Oct 23, 2009) Keefe, Bruyette & Woods (Market Perform - Oct 26, 2009) Stephens, Inc. (Equal-Weight - Oct 26, 2009) Macquarie Capital (USA)* (In Line - Sept 25, 2009) Sterne Agee & Leach, Inc. (Neutral - Oct 23, 2009) Raymond James & Associates (Outperform - Oct 26, 2009) SunTrust Robinson Humphrey (Buy - Oct 11, 2009) *Macquarie Capital (USA), Inc. acquired Fox-Pitt Kelton Cochran Caronia Waller LLC on 11/30/09.

Southern Community Bank Purchased - June 19, 2009 ($ in millions) Nine years old - Enhances presence in southside metro Atlanta markets Four banking offices in southside metro Atlanta MSA - Fayetteville, Coweta and Henry counties 54 employees $208 in customer deposits, including $53 core deposits FDIC assisted transaction: 80% guarantee on $109 loss threshold, 95% above Fully discounted bid with no credit exposure Accounted for credit related items (at FMV) as "covered assets" on balance sheet Q409 Q209 Loans $ 85 $ 110 OREO 34 25 FDIC receivable 67 95 Total Covered Assets $186 $ 230 Pre-tax gain on acquisition of $11.4 Accretive to earnings per share in 2009 50

Non-GAAP reconciliation tables 51

Non-GAAP reconciliation tables 52