SEC Filing | United Community Banks, Inc.

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t74186_8k.htm

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 26, 2012

United Community Banks, Inc.

(Exact name of registrant as specified in its charter)

	Georgia		No. 001-35095		No. 58-180-7304
(State or other jurisdiction of		(Commission File Number)		(IRS Employer
incorporation)				Identification No.)

125 Highway 515 East, 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:

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 Operations and Financial Condition.

	On July 26, 2012, United Community Banks, Inc. (the “Registrant”) issued a news release announcing its financial results for the quarter ended June 30, 2012 (the “News Release”). The News Release, including financial schedules, is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference. In connection with issuing the News Release, on July 26, 2012 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 June 30, 2012 Investor Presentation (the “Investor Presentation”), which will be posted to the Registrant’s website at www.ucbi.com. The Investor Presentation is attached as Exhibit 99.2 to this Current Report on Form 8-K and incorporated herein by reference. The presentation of the Registrant’s financial results includes 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 core earnings measures because it believes they are useful for evaluating the Registrant’s operations and performance over periods of time, and uses core earnings measures in managing and evaluating the Registrant’s business and intends to refer to them in discussions about the Registrant’s operations and performance. Core earnings measures exclude credit related costs such as the provision for loan losses, certain expenses and charges related to the Registrant’s 2011 asset disposition plans in the first quarter of 2011 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. 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 are 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

99.1 Press Release, dated July 26, 2012

99.2 Investor Presentation, Second Quarter 2012

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.

	UNITED COMMUNITY BANKS, INC.

	By:	/s/ Rex S. Schuette
		Rex S. Schuette Executive Vice President and Chief Financial Officer

Date: July 26, 2012

ex99-1.htm

Exhibit 99.1

For Immediate Release

For more information:

Rex S. Schuette

Chief Financial Officer

(706) 781-2266

Rex_Schuette@ucbi.com

UNITED COMMUNITY BANKS, INC. REPORTS

EARNINGS OF $6.5 MILLION FOR SECOND QUARTER 2012

·	Net income of $6.5 million, or six cents per share

·	Balance sheet restructuring includes $6.5 million of securities gains, mostly offset by wholesale funding prepayment charges

·	Nonperforming assets decline $15.8 million, or 10 percent, from first quarter

·	Core transaction deposits up $163 million year-to-date, or 11 percent annualized

BLAIRSVILLE, GA – July 26, 2012 – United Community Banks, Inc. (NASDAQ: UCBI) today reported net income of $6.5 million, or six cents per share, for the second quarter of 2012; and $18.0 million, or 21 cents per share, year-to-date. The results for the second quarter and first six months of 2012 reflect strong core transaction deposit growth, increases in fee revenue and lower operating expenses compared with the same periods a year ago.

“Our lower operating expenses reflect ongoing efforts to meaningfully increase operating efficiency, while at the same time remaining focused on improving credit measures,” said Jimmy Tallent, president and chief executive officer. “Our credit measures continue their positive trend, with nonperforming assets down $15.8 million, or 10 percent, from the first quarter. The second quarter marks our fourth profitable quarter following our 2011 capital transaction and the execution of our problem asset disposition plan. Looking forward, we expect profitability to continue from improved efficiency, revenue enhancements and expense reductions while growing and improving our business mix of loans and deposits.”

Total loans were $4.12 billion at quarter-end, down slightly from the first quarter and down $44 million from a year earlier. “While loans declined slightly in the second quarter they remain up year-to-date. We expect some volatility in balances due to the ongoing sluggish economy. We are prudently growing the portfolio by focusing on full-service relationships with small-to-medium-sized businesses. During the second quarter we added $132 million in new loan commitments, of which $87 million were funded by quarter-end. The majority were commercial loans.”

“Growing quality loan and deposit relationships remains a key focus for 2012,” Tallent commented. “The highly competitive market for quality lending opportunities keeps pressure on loan pricing. At the same time our success attracting core transaction deposits has continued, with balances increasing $12 million in the second quarter and an especially strong $151 million in the first quarter. Annualized, the growth rate is 11 percent.”

The second quarter provision for loan losses was $18 million, up from $11 million a year ago and $15 million in the first quarter. Second quarter net charge-offs were $18.9 million, compared to $16.5 million in the second quarter of 2011 and $15.9 million in the first quarter of 2012.

“Nonperforming assets of $145.8 million were down $15.8 million from the first quarter,” Tallent said. “Nonperforming asset levels are impacted significantly by the inflow of new nonperforming loans and our ability to liquidate foreclosed properties. In the second quarter, the inflow of new nonperforming loans slowed to $29.4 million from $32.4 million in the first quarter. Also, loans past due 30 to 89 days declined from .86 percent of outstanding loans in the first quarter to .65 percent in the second quarter. We expect our overall credit trends to continue to improve during 2012, although not necessarily in a linear fashion.”

Taxable equivalent net interest revenue declined $2.0 million from the first quarter of 2012, and $2.1 million from the second quarter of 2011, to $56.8 million. Said Tallent, “The decrease from the first quarter was primarily due to the lower yield on the securities portfolio, which was significantly impacted by heavy prepayment activity in the mortgage market. This activity accelerated the amortization of bond purchase premiums, suppressing the securities portfolio yield. Further, the yields at which the proceeds were reinvested fell short of those of the bonds they replaced. Consequently, our net interest margin was down 10 basis points from the first quarter, to 3.43 percent. It was up two basis points, however, from the second quarter of 2011.”

Fee revenue was $12.9 million in the second quarter, compared to $15.4 million in the first quarter and $13.9 million a year ago. The decline in fee revenue from the first quarter of 2012 and second quarter of 2011 was primarily due to nonrecurring revenue items noted below. Service charges and fees were $7.8 million, similar to the first quarter and up $208,000 from the second quarter of 2011. The increase in service charges and fees from a year ago reflects new fees on deposit accounts that became effective in the first quarter of 2012, which more than offset lower overdraft fees.

Fee revenue for the quarter included $6.5 million of securities gains reflecting the sale of $175 million in fixed rate securities. As part of the balance sheet restructuring, $75 million of fixed rate wholesale funding was prepaid, resulting in prepayment charges of $6.2 million. “Overall, the deleveraging of our balance sheet should improve our margin and interest rate sensitivity, while maintaining the level of net interest revenue,” stated Tallent.

Mortgage fee revenue of $2.3 million reflected a $223,000 increase from the first quarter and $1.4 million from a year ago. Comparisons to prior periods are influenced significantly by the interest rate environment and refinancing activities. Closed mortgage loans totaled $79.8 million in the second quarter of 2012 compared with $81.7 million in the first quarter and $50.5 million in the second quarter of 2011. Other fee revenue was down $3 million from both the first quarter of 2012 and the fourth quarter of 2011, to $1.6 million. The first quarter of 2012 included $1.1 million in interest on a prior year’s federal tax refund, $728,000 in gains from the sale of low income housing tax credits, and $115,000 in hedge ineffectiveness gains. The second quarter of 2011 included $2.8 million in hedge ineffectiveness gains, in contrast with $180,000 in hedge ineffectiveness losses in the second quarter of 2012.

Excluding foreclosed property costs, second quarter 2012 operating expenses were $42.5 million compared to $43.1 million for the first quarter and $46.8 million a year ago. Lower staff levels and related costs were the primary drivers of the decrease from both periods, with 93 fewer staff positions compared to the first quarter and 153 fewer from a year ago. Most other expense categories were down as well, reflecting efforts to improve operating efficiency by lowering costs. The decrease in operating expenses from a year ago also reflects a $1.1 million decrease in the FDIC assessment due to a lower assessment rate.

Foreclosed property costs for the second quarter of 2012 were $1.9 million, compared to $3.8 million in the first quarter and $1.9 million a year ago. Second quarter 2012 costs included $1.1 million for maintenance and $739,000 in net losses and write-downs. For the first quarter, foreclosed property costs included $1.6 million in maintenance and $2.2 million in net losses and write-downs. Second quarter 2011 costs included $2.0 million in maintenance and $100,000 in net gains from sales.

As of June 30, 2012, capital ratios were as follows: Tier 1 Risk-Based of 14.2 percent; Tier 1 Leverage of 9.1 percent; and Total Risk-Based of 15.9 percent. The Tier 1 Common Risk-Based ratio was 8.7 percent and the tangible equity-to-assets ratio was 8.2 percent.

Conference Call

United will hold a conference call today, Thursday, July 26, 2012, 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 97692673. The conference call also will be webcast and can be accessed by selecting ‘Calendar of Events’ within the Investor Relations section of the United’s website at www.ucbi.com.

About United Community Banks, Inc.

Headquartered in Blairsville, United Community Banks, Inc. is the third-largest bank holding company in Georgia. United has assets of $6.7 billion and operates 27 community banks with 104 banking offices throughout north Georgia, the Atlanta region, coastal Georgia, western North Carolina and east Tennessee. United specializes in providing personalized community banking services to individuals and small to mid-size businesses and also offers the convenience of 24-hour access through a network of ATMs, telephone and on-line banking. United’s common stock is listed on the Nasdaq Global Select Market under the symbol UCBI. Additional information may be found at United’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 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 2011 Annual Report on Form 10-K under the section 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

																Second
	2012						2011									Quarter			For the Six						YTD
(in thousands, except per share	Second			First			Fourth			Third			Second			2012-2011			Months Ended						2012-2011
data; taxable equivalent)	Quarter			Quarter			Quarter			Quarter			Quarter			Change				2012			2011		Change
INCOME SUMMARY
Interest revenue	$	66,780		$	70,221		$	71,905		$	74,543		$	76,931					$	137,001		$	152,896
Interest expense		9,944			11,357			12,855			15,262			17,985						21,301			37,558
Net interest revenue		56,836			58,864			59,050			59,281			58,946			(4	) %		115,700			115,338			-	%
Provision for loan losses		18,000			15,000			14,000			36,000			11,000						33,000			201,000
Fee revenue		12,867			15,379			12,667			11,498			13,905			(7	)		28,246			25,743			10
Total revenue		51,703			59,243			57,717			34,779			61,851						110,946			(59,919	)
Operating expenses		44,310			46,955			51,080			46,520			48,728			(9	)		91,265			163,999			(44	)
Income (loss) before income taxes		7,393			12,288			6,637			(11,741	)		13,123						19,681			(223,918	)
Income tax expense (benefit)		894			760			(3,264	)		(402	)		1,095						1,654			1,390
Net income (loss)		6,499			11,528			9,901			(11,339	)		12,028			(46	)		18,027			(225,308	)
Preferred dividends and discount accretion		3,032			3,030			3,025			3,019			3,016						6,062			5,794
Net income (loss) available to common shareholders	$	3,467		$	8,498		$	6,876		$	(14,358	)	$	9,012			(62	)	$	11,965		$	(231,102	)

PERFORMANCE MEASURES
Per common share:
Diluted income (loss)	$	.06		$	.15		$	.12		$	(.25	)	$	.16			(63	)	$	.21		$	(10.52	)
Book value		6.61			6.68			6.62			6.77			7.11			(7	)		6.61			7.11			(7	)
Tangible book value (2)		6.48			6.54			6.47			6.61			6.94			(7	)		6.48			6.94			(7	)

Key performance ratios:
Return on equity (1)(3)		3.51	%		8.78	%		7.40	%		(15.06	) %		42.60	%					6.12	%		(345.86	)%
Return on assets (3)		.37			.66			.56			(.64	)		.66						.52			(6.16	)
Net interest margin (3)		3.43			3.53			3.51			3.55			3.41						3.48			3.36
Efficiency ratio		63.84			63.31			71.23			65.73			66.88						63.56			116.28
Equity to assets		8.33			8.19			8.28			8.55			8.06						8.26			7.11
Tangible equity to assets (2)		8.24			8.08			8.16			8.42			7.93						8.16			7.00
Tangible common equity to assets (2)		5.45			5.33			5.38			5.65			1.37						5.39			2.05
Tangible common equity to risk- weighted assets (2)		8.37			8.21			8.25			8.52			8.69						8.37			8.69

ASSET QUALITY *
Non-performing loans	$	115,340		$	129,704		$	127,479		$	144,484		$	71,065					$	115,340		$	71,065
Foreclosed properties		30,421			31,887			32,859			44,263			47,584						30,421			47,584
Total non-performing assets (NPAs)		145,761			161,591			160,338			188,747			118,649						145,761			118,649
Allowance for loan losses		112,705			113,601			114,468			146,092			127,638						112,705			127,638
Net charge-offs		18,896			15,867			45,624			17,546			16,483						34,763			248,057
Allowance for loan losses to loans		2.74	%		2.75	%		2.79	%		3.55	%		3.07	%					2.74	%		3.07	%
Net charge-offs to average loans (3)		1.85			1.55			4.39			1.68			1.58						1.70			11.46
NPAs to loans and foreclosed properties		3.51			3.88			3.87			4.54			2.82						3.51			2.82
NPAs to total assets		2.16			2.25			2.30			2.74			1.66						2.16			1.66

AVERAGE BALANCES ($ in millions)
Loans	$	4,156		$	4,168		$	4,175		$	4,194		$	4,266			(3	)	$	4,162		$	4,432			(6	)
Investment securities		2,145			2,153			2,141			2,150			2,074			3			2,149			1,851			16
Earning assets		6,665			6,700			6,688			6,630			6,924			(4	)		6,682			6,913			(3	)
Total assets		6,993			7,045			7,019			7,000			7,363			(5	)		7,019			7,371			(5	)
Deposits		5,853			6,028			6,115			6,061			6,372			(8	)		5,940			6,465			(8	)
Shareholders’ equity		583			577			581			598			594			(2	)		580			524			11
Common shares - basic (thousands)		57,840			57,764			57,646			57,599			25,427						57,803			21,965
Common shares - diluted (thousands)		57,840			57,764			57,646			57,599			57,543						57,803			21,965

AT PERIOD END ($ in millions)
Loans *	$	4,119		$	4,128		$	4,110		$	4,110		$	4,163			(1	)	$	4,119		$	4,163			(1	)
Investment securities		1,984			2,202			2,120			2,123			2,188			(9	)		1,984			2,188			(9	)
Total assets		6,737			7,174			6,983			6,894			7,152			(6	)		6,737			7,152			(6	)
Deposits		5,822			6,001			6,098			6,005			6,183			(6	)		5,822			6,183			(6	)
Shareholders’ equity		576			580			575			583			603			(4	)		576			603			(4	)
Common shares outstanding (thousands)		57,641			57,603			57,561			57,510			57,469						57,641			57,469

(1) 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). (2) Excludes effect of acquisition related intangibles and associated amortization. (3) Annualized.

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

UNITED COMMUNITY BANKS, INC.
Non-GAAP Performance Measures Reconciliation
Selected Financial Information

	2012						2011									For the Six Months Ended
(in thousands, except per share	Second			First			Fourth			Third			Second			For the Six Months Ended
data; taxable equivalent)	Quarter			Quarter			Quarter			Quarter			Quarter			2012			2011

Interest revenue reconciliation
Interest revenue - taxable equivalent	$	66,780		$	70,221		$	71,905		$	74,543		$	76,931		$	137,001		$	152,896
Taxable equivalent adjustment		(444	)		(446	)		(423	)		(420	)		(429	)		(890	)		(864	)
Interest revenue (GAAP)	$	66,336		$	69,775		$	71,482		$	74,123		$	76,502		$	136,111		$	152,032

Net interest revenue reconciliation
Net interest revenue - taxable equivalent	$	56,836		$	58,864		$	59,050		$	59,281		$	58,946		$	115,700		$	115,338
Taxable equivalent adjustment		(444	)		(446	)		(423	)		(420	)		(429	)		(890	)		(864	)
Net interest revenue (GAAP)	$	56,392		$	58,418		$	58,627		$	58,861		$	58,517		$	114,810		$	114,474

Total revenue reconciliation
Total operating revenue	$	51,703		$	59,243		$	57,717		$	34,779		$	61,851		$	110,946		$	(59,919	)
Taxable equivalent adjustment		(444	)		(446	)		(423	)		(420	)		(429	)		(890	)		(864	)
Total revenue (GAAP)	$	51,259		$	58,797		$	57,294		$	34,359		$	61,422		$	110,056		$	(60,783	)

Income (loss) before taxes reconciliation
Income (loss) before taxes	$	7,393		$	12,288		$	6,637		$	(11,741	)	$	13,123		$	19,681		$	(223,918	)
Taxable equivalent adjustment		(444	)		(446	)		(423	)		(420	)		(429	)		(890	)		(864	)
Income (loss) before taxes (GAAP)	$	6,949		$	11,842		$	6,214		$	(12,161	)	$	12,694		$	18,791		$	(224,782	)

Income tax (benefit) expense reconciliation
Income tax (benefit) expense	$	894		$	760		$	(3,264	)	$	(402	)	$	1,095		$	1,654		$	1,390
Taxable equivalent adjustment		(444	)		(446	)		(423	)		(420	)		(429	)		(890	)		(864	)
Income tax (benefit) expense (GAAP)	$	450		$	314		$	(3,687	)	$	(822	)	$	666		$	764		$	526

Book value per common share reconciliation
Tangible book value per common share	$	6.48		$	6.54		$	6.47		$	6.61		$	6.94		$	6.48		$	6.94
Effect of goodwill and other intangibles		.13			.14			.15			.16			.17			.13			.17
Book value per common share (GAAP)	$	6.61		$	6.68		$	6.62		$	6.77		$	7.11		$	6.61		$	7.11

Average equity to assets reconciliation
Tangible common equity to assets		5.45	%		5.33	%		5.38	%		5.65	%		1.37	%		5.39	%		2.05	%
Effect of preferred equity		2.79			2.75			2.78			2.77			6.56			2.77			4.95
Tangible equity to assets		8.24			8.08			8.16			8.42			7.93			8.16			7.00
Effect of goodwill and other intangibles		.09			.11			.12			.13			.13			.10			.11
Equity to assets (GAAP)		8.33	%		8.19	%		8.28	%		8.55	%		8.06	%		8.26	%		7.11	%

Tangible common equity to risk-weighted assets reconciliation
Tangible common equity to risk-weighted assets		8.37	%		8.21	%		8.25	%		8.52	%		8.69	%		8.37	%		8.69	%
Effect of other comprehensive income		.28			.10			(.03	)		(.29	)		(.42	)		.28			(.42	)
Effect of trust preferred		1.19			1.15			1.18			1.19			1.15			1.19			1.15
Effect of preferred equity		4.35			4.23			4.29			4.33			4.20			4.35			4.20
Tier I capital ratio (Regulatory)		14.19	%		13.69	%		13.69	%		13.75	%		13.62	%		14.19	%		13.62	%

UNITED COMMUNITY BANKS, INC.

Financial Highlights

Loan Portfolio Composition at Period-End (1)


	2012				2011						Linked Quarter Change			Year over Year Change
	Second		First		Fourth		Third		Second
(in millions)	Quarter		Quarter		Quarter		Quarter		Quarter
LOANS BY CATEGORY
Commercial (sec.by RE)	$	1,837	$	1,843	$	1,822	$	1,771	$	1,742	$	(6	)	$	95
Commercial & industrial		450		440		428		429		428		10			22
Commercial construction		169		167		164		169		195		2			(26	)
Total commercial		2,456		2,450		2,414		2,369		2,365		6			91
Residential mortgage		1,128		1,131		1,135		1,150		1,177		(3	)		(49	)
Residential construction		409		436		448		474		502		(27	)		(93	)
Consumer installment		126		111		113		117		119		15			7
Total loans	$	4,119	$	4,128	$	4,110	$	4,110	$	4,163		(9	)		(44	)

LOANS BY MARKET
North Georgia	$	1,387	$	1,408	$	1,426	$	1,478	$	1,500		(21	)		(113	)
Atlanta MSA		1,252		1,239		1,220		1,192		1,188		13			64
North Carolina		576		588		597		607		626		(12	)		(50	)
Coastal Georgia		369		366		346		316		325		3			44
Gainesville MSA		259		262		265		272		275		(3	)		(16	)
East Tennessee		276		265		256		245		249		11			27
Total loans	$	4,119	$	4,128	$	4,110	$	4,110	$	4,163		(9	)		(44	)

RESIDENTIAL CONSTRUCTION
Dirt loans
Acquisition & development	$	78	$	86	$	88	$	97	$	105		(8	)		(27	)
Land loans		45		57		61		60		62		(12	)		(17	)
Lot loans		203		204		207		216		218		(1	)		(15	)
Total		326		347		356		373		385		(21	)		(59	)

House loans
Spec		49		57		59		64		74		(8	)		(25	)
Sold		34		32		33		37		43		2			(9	)
Total		83		89		92		101		117		(6	)		(34	)
Total residential construction	$	409	$	436	$	448	$	474	$	502		(27	)		(93	)

RESIDENTIAL CONSTRUCTION - ATLANTA MSA
Dirt loans
Acquisition & development	$	14	$	17	$	17	$	19	$	20		(3	)		(6	)
Land loans		9		13		14		15		16		(4	)		(7	)
Lot loans		22		22		22		22		22		-			-
Total		45		52		53		56		58		(7	)		(13	)

House loans
Spec		24		27		27		28		30		(3	)		(6	)
Sold		7		7		6		8		9		-			(2	)
Total		31		34		33		36		39		(3	)		(8	)
Total residential construction	$	76	$	86	$	86	$	92	$	97		(10	)		(21	)

(1) Excludes total loans of $41.5 million, $47.2 million, $54.5 million, $57.8 million and $70.8 million as of June 30, 2012, March 31, 2012, December 31, 2011, September 30, 2011 and June 30, 2011, respectively, that are covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.

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

	Second Quarter 2012									First Quarter 2012									Fourth Quarter 2011
(in thousands)	Non-performing Loans			Foreclosed Properties			Total NPAs			Non-performing Loans			Foreclosed Properties			Total NPAs			Non-performing Loans			Foreclosed Properties			Total NPAs
NPAs BY CATEGORY
Commercial (sec.by RE)	$	19,115		$	10,586		$	29,701		$	26,081		$	10,808		$	36,889		$	27,322		$	9,745		$	37,067
Commercial & industrial		34,982			-			34,982			36,314			-			36,314			34,613			-			34,613
Commercial construction		18,175			2,732			20,907			23,319			3,266			26,585			16,655			3,336			19,991
Total commercial		72,272			13,318			85,590			85,714			14,074			99,788			78,590			13,081			91,671
Residential mortgage		16,631			5,591			22,222			18,741			5,882			24,623			22,358			6,927			29,285
Residential construction		25,530			11,512			37,042			24,341			11,931			36,272			25,523			12,851			38,374
Consumer installment		907			-			907			908			-			908			1,008			-			1,008
Total NPAs	$	115,340		$	30,421		$	145,761		$	129,704		$	31,887		$	161,591		$	127,479		$	32,859		$	160,338
Balance as a % of
Unpaid Principal		68.8	%		39.3	%		59.4	%		70.6	%		36.1	%		59.4	%		71.3	%		35.9	%		59.3	%

NPAs BY MARKET
North Georgia	$	77,332		$	13,546		$	90,878		$	81,117		$	14,559		$	95,676		$	88,600		$	15,136		$	103,736
Atlanta MSA		17,593			8,651			26,244			22,321			7,647			29,968			14,480			6,169			20,649
North Carolina		10,657			3,287			13,944			15,765			4,650			20,415			15,100			5,365			20,465
Coastal Georgia		5,822			785			6,607			5,622			1,268			6,890			5,248			1,620			6,868
Gainesville MSA		991			2,998			3,989			2,210			3,387			5,597			2,069			3,760			5,829
East Tennessee		2,945			1,154			4,099			2,669			376			3,045			1,982			809			2,791
Total NPAs	$	115,340		$	30,421		$	145,761		$	129,704		$	31,887		$	161,591		$	127,479		$	32,859		$	160,338


NPA ACTIVITY
Beginning Balance	$	129,704		$	31,887		$	161,591		$	127,479		$	32,859		$	160,338		$	144,484		$	44,263		$	188,747
Loans placed on non-accrual		29,364			-			29,364			32,437			-			32,437			45,675			-			45,675
Payments received		(15,027	)		-			(15,027	)		(5,945	)		-			(5,945	)		(1,884	)		-			(1,884	)
Loan charge-offs		(19,382	)		-			(19,382	)		(14,733	)		-			(14,733	)		(44,757	)		-			(44,757	)
Foreclosures		(9,319	)		9,319			-			(9,534	)		9,534			-			(16,039	)		16,039			-
Capitalized costs		-			415			415			-			329			329			-			141			141
Note / property sales		-			(10,461	)		(10,461	)		-			(8,631	)		(8,631	)		-			(20,651	)		(20,651	)
Write downs		-			(1,008	)		(1,008	)		-			(2,111	)		(2,111	)		-			(3,893	)		(3,893	)
Net gains (losses) on sales		-			269			269			-			(93	)		(93	)		-			(3,040	)		(3,040	)
Ending Balance	$	115,340		$	30,421		$	145,761		$	129,704		$	31,887		$	161,591		$	127,479		$	32,859		$	160,338

	Second Quarter 2012						First Quarter 2012					Fourth Quarter 2011
				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)	$	4,349			.95	%	$	3,697		.81	%	$	4,962		1.09	%
Commercial & industrial		775			.70			669		.62			18,940		17.47
Commercial construction		88			.21			334		.81			3,318		7.88
Total commercial		5,212			.86			4,700		.78			27,220		4.51
Residential mortgage		3,862			1.38			5,375		1.91			5,887		2.04
Residential construction		9,563			9.14			5,314		4.84			12,090		10.36
Consumer installment		259			.88			478		1.72			427		1.47
Total	$	18,896			1.85		$	15,867		1.55		$	45,624		4.39


NET CHARGE-OFFS BY MARKET
North Georgia	$	12,474			3.58	%	$	9,022		2.56	%	$	34,970		9.46	%
Atlanta MSA		2,307			.75			2,729		.89			4,195		1.37
North Carolina		3,634			2.52			1,679		1.14			3,180		2.10
Coastal Georgia		211			.23			1,329		1.53			335		.41
Gainesville MSA		(187	)		(.29	)		883		1.35			2,572		3.84
East Tennessee		457			.68			225		.34			372		.59
Total	$	18,896			1.85		$	15,867		1.55		$	45,624		4.39

(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 Operations (Unaudited)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
(in thousands, except per share data)	2012			2011			2012			2011

Interest revenue:
Loans, including fees	$	54,178		$	60,958		$	109,937		$	122,065
Investment securities, including tax exempt of $262, $251, $512 and $510		11,062			14,792			24,066			28,396
Federal funds sold, reverse repurchase agreements, commercial paper and deposits in banks		1,096			752			2,108			1,571
Total interest revenue		66,336			76,502			136,111			152,032

Interest expense:
Deposits:
NOW		503			1,036			1,140			2,360
Money market		661			1,499			1,302			3,527
Savings		38			64			75			141
Time		5,073			10,995			11,232			22,727
Total deposit interest expense		6,275			13,594			13,749			28,755
Federal funds purchased, repurchase agreements and other short-term borrowings		904			1,074			1,949			2,116
Federal Home Loan Bank advances		390			570			856			1,160
Long-term debt		2,375			2,747			4,747			5,527
Total interest expense		9,944			17,985			21,301			37,558
Net interest revenue		56,392			58,517			114,810			114,474
Provision for loan losses		18,000			11,000			33,000			201,000
Net interest revenue after provision for loan losses		38,392			47,517			81,810			(86,526	)

Fee revenue:
Service charges and fees		7,816			7,608			15,599			14,328
Mortgage loan and other related fees		2,322			952			4,421			2,446
Brokerage fees		809			691			1,622			1,368
Securities gains, net		6,490			783			7,047			838
Loss from prepayment of debt		(6,199	)		(791	)		(6,681	)		(791	)
Other		1,629			4,662			6,238			7,554
Total fee revenue		12,867			13,905			28,246			25,743
Total revenue		51,259			61,422			110,056			(60,783	)

Operating expenses:
Salaries and employee benefits		24,297			26,436			49,522			51,360
Communications and equipment		3,211			3,378			6,366			6,722
Occupancy		3,539			3,805			7,310			7,879
Advertising and public relations		1,088			1,317			1,934			2,295
Postage, printing and supplies		916			1,085			1,895			2,203
Professional fees		1,952			2,350			3,927			5,680
Foreclosed property		1,851			1,891			5,676			66,790
FDIC assessments and other regulatory charges		2,545			3,644			5,055			9,057
Amortization of intangibles		730			760			1,462			1,522
Other		4,181			4,062			8,118			10,491
Total operating expenses		44,310			48,728			91,265			163,999
Net income (loss) before income taxes		6,949			12,694			18,791			(224,782	)
Income tax expense		450			666			764			526
Net income (loss)		6,499			12,028			18,027			(225,308	)
Preferred stock dividends and discount accretion		3,032			3,016			6,062			5,794
Net income (loss) available to common shareholders	$	3,467		$	9,012		$	11,965		$	(231,102	)

Earnings (loss) per common share - Basic	$	.06		$	.35		$	.21		$	(10.52	)
Earnings (loss) per common share - Diluted		.06			.16			.21			(10.52	)
Weighted average common shares outstanding - Basic		57,840			25,427			57,803			21,965
Weighted average common shares outstanding - Diluted		57,840			57,543			57,803			21,965

UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheet
	June 30,			December 31,			June 30,
(in thousands, except share and per share data)	2012			2011			2011
	(unaudited)			(audited)			(unaudited)
ASSETS
Cash and due from banks	$	50,596		$	53,807		$	163,331
Interest-bearing deposits in banks		133,857			139,609			41,863
Federal funds sold, reverse repurchase agreements, commercial paper and short-term investments		120,000			185,000			174,996
Cash and cash equivalents		304,453			378,416			380,190
Securities available for sale		1,701,583			1,790,047			1,816,613
Securities held to maturity (fair value $299,971, $343,531 and $379,231)		282,750			330,203			371,578
Mortgage loans held for sale		18,645			23,881			19,406
Loans, net of unearned income		4,119,235			4,109,614			4,163,447
Less allowance for loan losses		112,705			114,468			127,638
Loans, net		4,006,530			3,995,146			4,035,809
Assets covered by loss sharing agreements with the FDIC		65,914			78,145			95,726
Premises and equipment, net		172,200			175,088			178,208
Bank owned life insurance		81,265			80,599			80,134
Accrued interest receivable		20,151			20,693			21,291
Goodwill and other intangible assets		6,965			8,428			9,922
Foreclosed property		30,421			32,859			47,584
Other assets		46,229			69,915			95,834
Total assets	$	6,737,106		$	6,983,420		$	7,152,295
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Deposits:
Demand	$	1,150,444		$	992,109		$	899,017
NOW		1,196,507			1,509,896			1,306,109
Money market		1,117,139			1,038,778			989,600
Savings		219,077			199,007			197,927
Time:
Less than $100,000		1,164,451			1,332,394			1,508,444
Greater than $100,000		764,343			847,152			981,154
Brokered		210,506			178,647			300,964
Total deposits		5,822,467			6,097,983			6,183,215
Federal funds purchased, repurchase agreements, and other short-term borrowings		53,656			102,577			103,666
Federal Home Loan Bank advances		125,125			40,625			40,625
Long-term debt		120,265			120,225			150,186
Unsettled securities purchases		-			10,325			35,634
Accrued expenses and other liabilities		39,598			36,199			36,368
Total liabilities		6,161,111			6,407,934			6,549,694
Shareholders’ equity:
Preferred stock, $1 par value; 10,000,000 shares authorized;
Series A; $10 stated value; 21,700 shares issued and outstanding		217			217			217
Series B; $1,000 stated value; 180,000 shares issued and outstanding		177,814			177,092			176,392
Series D; $1,000 stated value; 16,613 shares issued and outstanding		16,613			16,613			16,613
Common stock, $1 par value; 100,000,000 shares authorized;
41,726,509, 41,647,100 and 41,554,874 shares issued and outstanding		41,727			41,647			41,555
Common stock, non-voting, $1 par value; 30,000,000 shares authorized;
15,914,209 shares issued and outstanding		15,914			15,914			15,914
Common stock issuable; 94,657, 93,681 and 83,575 shares		2,893			3,233			3,574
Capital surplus		1,056,819			1,054,940			1,052,482
Accumulated deficit		(718,896	)		(730,861	)		(723,378	)
Accumulated other comprehensive (loss) income		(17,106	)		(3,309	)		19,232
Total shareholders’ equity		575,995			575,486			602,601
Total liabilities and shareholders’ equity	$	6,737,106		$	6,983,420		$	7,152,295

UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended June 30,

	2012								2011
	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)	$	4,155,619		$	54,296		5.25	%	$	4,266,211		$	60,958		5.73	%
Taxable securities (3)		2,121,053			10,800		2.04			2,048,683			14,541		2.84
Tax-exempt securities (1)(3)		24,242			429		7.08			25,044			411		6.56
Federal funds sold and other interest-earning assets		364,099			1,255		1.38			583,832			1,021		.70
Total interest-earning assets		6,665,013			66,780		4.03			6,923,770			76,931		4.45
Non-interest-earning assets:
Allowance for loan losses		(115,955	)							(139,744	)
Cash and due from banks		51,907								119,801
Premises and equipment		173,792								178,949
Other assets (3)		218,347								280,204
Total assets	$	6,993,104							$	7,362,980

Liabilities and Shareholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW	$	1,279,686			503		.16		$	1,310,441			1,036		.32
Money market		1,132,548			661		.23			979,432			1,499		.61
Savings		216,175			38		.07			195,946			64		.13
Time less than $100,000		1,183,845			2,520		.86			1,541,909			4,990		1.30
Time greater than $100,000		778,477			2,063		1.07			988,810			3,873		1.57
Brokered time deposits		150,449			490		1.31			473,161			2,132		1.81
Total interest-bearing deposits		4,741,180			6,275		.53			5,489,699			13,594		.99

Federal funds purchased and other borrowings		97,134			904		3.74			103,156			1,074		4.18
Federal Home Loan Bank advances		278,971			390		.56			52,735			570		4.34
Long-term debt		120,256			2,375		7.94			150,178			2,747		7.34
Total borrowed funds		496,361			3,669		2.97			306,069			4,391		5.75

Total interest-bearing liabilities		5,237,541			9,944		.76			5,795,768			17,985		1.24
Non-interest-bearing liabilities:
Non-interest-bearing deposits		1,112,128								882,151
Other liabilities		60,726								91,353
Total liabilities		6,410,395								6,769,272
Shareholders’ equity		582,709								593,708
Total liabilities and shareholders' equity	$	6,993,104							$	7,362,980

Net interest revenue				$	56,836							$	58,946
Net interest-rate spread							3.27	%							3.21	%

Net interest margin (4)							3.43	%							3.41	%

(1)	Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 39%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2)	Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued and loans that are held for sale.
(3)	Securities available for sale are shown at amortized cost. Pretax unrealized gains of $25.7 million in 2012 and $32.2 million in 2011 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 Six Months Ended June 30,

	2012								2011
	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)	$	4,162,030		$	110,138		5.32	%	$	4,431,617		$	122,028		5.55	%
Taxable securities (3)		2,124,422			23,554		2.22			1,825,322			27,886		3.06
Tax-exempt securities (1)(3)		24,840			839		6.76			25,434			835		6.57
Federal funds sold and other interest-earning assets		371,044			2,470		1.33			630,384			2,147		.68
Total interest-earning assets		6,682,336			137,001		4.12			6,912,757			152,896		4.45
Non-interest-earning assets:
Allowance for loan losses		(116,879	)							(154,347	)
Cash and due from banks		53,286								127,031
Premises and equipment		174,321								179,150
Other assets (3)		226,013								306,495
Total assets	$	7,019,077							$	7,371,086

Liabilities and Shareholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW	$	1,368,900			1,140		.17		$	1,341,618			2,360		.35
Money market		1,101,103			1,302		.24			954,128			3,527		.75
Savings		210,789			75		.07			191,708			141		.15
Time less than $100,000		1,227,599			5,546		.91			1,541,130			10,441		1.37
Time greater than $100,000		799,821			4,478		1.13			989,840			8,024		1.63
Brokered time deposits		155,892			1,208		1.56			585,103			4,262		1.47
Total interest-bearing deposits		4,864,104			13,749		.57			5,603,527			28,755		1.03

Federal funds purchased and other borrowings		99,696			1,949		3.93			102,132			2,116		4.18
Federal Home Loan Bank advances		208,672			856		.82			53,923			1,160		4.34
Long-term debt		120,246			4,747		7.94			150,169			5,527		7.42
Total borrowed funds		428,614			7,552		3.54			306,224			8,803		5.80

Total interest-bearing liabilities		5,292,718			21,301		.81			5,909,751			37,558		1.28
Non-interest-bearing liabilities:
Non-interest-bearing deposits		1,076,358								861,864
Other liabilities		70,330								75,083
Total liabilities		6,439,406								6,846,698
Shareholders' equity		579,671								524,388
Total liabilities and shareholders’ equity	$	7,019,077							$	7,371,086

Net interest revenue				$	115,700							$	115,338
Net interest-rate spread							3.31	%							3.17	%

Net interest margin (4)							3.48	%							3.36	%

(1)	Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 39%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2)	Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued and loans that are held for sale.
(3)	Securities available for sale are shown at amortized cost. Pretax unrealized gains of $24.7 million in 2012 and $29.7 million in 2011 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.

ex99-2.htm

Exhibit 99.2

Jimmy C. Tallent

President & CEO

Rex S. Schuette

EVP & CFO rex_schuette@ucbi.com (706) 781-2266

David P. Shearrow

EVP & CRO United Community Banks, Inc.

Second Quarter 2012 Investor Presentation

July 26, 2012

Cautionary Statement

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 Community Banks, Inc.’s filings with the Securities and Exchange Commission including its 2011 Annual Report on Form 10‐K under the sections entitled “Forward‐Looking Statements”. Forward‐looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward‐looking statements.

Non-GAAP Measures

This presentation also contains 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 net interest margin, core net interest revenue, 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, net interest revenue, 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 for 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 to this presentation.

United at a Glance

Founded in 1950

Third‐largest bank holding company in Georgia

Headquartered in Blairsville, Georgia with 104 locations throughout north Georgia, metro Atlanta, coastal Georgia, western North Carolina and east Tennessee

1,651 employees

27 Banks and 104 Offices

Deposit Market Share(1)

Market Banks Offices Deposit Share Rank

North Georgia 11 22 33% 1

Atlanta MSA 10 38 4 7

Gainesville MSA 1 5 14 3

Coastal Georgia 2 8 6 7

Western North Carolina 1 20 13 3

East Tennessee 2 11 2 10

Key Statistics as of 6/30/12

(billions)

Total assets $6.74

Total deposits $5.82

Loans $4.12

¹ FDIC deposit market share and rank as of 6/11 for markets where United takes deposits. Source: SNL and FDIC.

Highlights Second Quarter

Improving Quarterly Results

Net Income of $6.5 million, or 6 cents per share

Fourth quarterly profit in past five quarters

Core earnings (pre-tax, pre-credit) of $28.3 million

Strong Core Transaction Deposit Growth

Year-to-date up 11% annualized

Building customer deposit base

Represents 55% of total customer deposits compared to 34% three years ago

Non Performing Assets Declining

LOAN PORTFOLIO & CREDIT QUALITY

Loan Portfolio (total $4.12 billion)

Commercial Loans (total $2.46 billion)

Commercial Real Estate (by loan type)

June 30, 2012

Owner Income

(in millions) Occupied Producing Total Percent

Office Buildings $ 299 $ 205 $ 504 28%

Retail 118 138 256 15

Small Warehouses/Storage 116 74 190 10

Multi-Residential/Other Properties 62 90 152 8

Churches 141 - 141 8

Convenience Stores 74 24 98 5

Hotels/Motels - 87 87 5

Franchise / Restaurants 38 34 72 4

Farmland 61 - 61 3

Manufacturing Facility 45 8 53 3

Auto Dealership/Service 45 8 53 3

Golf Course/Recreation 49 - 49 3

Leasehold Property 17 10 27 1

Daycare Facility 17 9 26 1

Carwash 17 1 18 1

Movie TheaterBowling/Recreation 16 - 16 1

Funeral Home 12 1 13 1

Marina 10 - 10 1

Mobile Home Parks - 8 8 1

Other Small Business 3 - 3 1

Total $ 1,140 $ 697 $ 1,837

Portfolio Characteristics

58.7% owner-occupied

Small business, doctors, dentists, attorneys, CPAs

$12 million project limit

Average Loan Size o $469 Composite CRE o $425 Owner Occupied o $606 Income Producing

Commercial Construction (by loan type)

June 30, 2012

(in millions) Amount Percent

Land Develop - Vacant (Improved) $ 64 38 %

Raw Land - Vacant (Unimproved) 59 35

Commercial Land Development 25 15

Office Buildings 5 3

Churches 5 3

Warehouse 2 1

Carwash 1 1

Restaurants/Fast Food/Other Franchise 1 1

Retail Building 1 1

Hotels/Motels 1 0

Mobile Home Parks 1 0

Miscellaneous Construction 4 2

Total Commercial Construction $ 169 100 %

Portfolio Characteristics

Average loan size: $455k

Residential Mortgage (total $1.13 billion)

Origination Characteristics No broker loans Policy Max LTV: 80-85% 55% of HE Primary Lien

Residential Construction (total $0.41 billion)

Average Loan Size (in thousands)

Spec $ 231k

Sold 119k

Develop 604k

Raw Land 111k

12% Raw $.05B

49% 20% Lot Developing $.20B $.08B

Residential Construction – Total Company

2Q12 vs.

(in millions) 2Q12 1Q12 4Q113Q112Q112Q11

Land Loans

Developing Land $ 78 $ 86 $ 88$97$105$(27)

Raw Land 45 57 616062(17)

Lot Loans 203 204 207216218(15)

Total 326 347 356373385(59)

Construction Loans

Spec 49 57 596474(25)

Sold 34 32 333743(9)

Total 83 89 92101117(34)

Total Res Construction $ 409 $ 436 $ 448$474$502$(93)

By Region

Atlanta $ 76 $ 86 $ 86$92$97$(21)

Gainesville MSA 19 20 202525(6)

North Georgia 193 206 214229249(56)

North Carolina 87 88 919295(8)

Coastal Georgia 22 23 242424(2)

Tennessee 12 13 131212-

Total Res Construction $ 409 $ 436 $ 448$474$502$(93)

New Loans Funded – Category and Market

(in millions)

CATEGORY 2Q12 1Q12

Commercial RE:

Owner Occupied $ 25.5 $ 55.0

Income Producing 7.1 15.3

Total Commercial RE 32.6 70.3

Commercial C & I 15.3 26.0

Commercial Constr. 4.6 2.9

Residential 25.1 24.7

Residential Constr. 7.9 6.4

Consumer 1.0 1.1

Total Categories $ 86.5 $ 131.4

MARKET 2Q12 1Q12

Atlanta $ 35.5 $ 54.2

Coastal Georgia 9.8 25.4

N. Georgia 21.9 25.1

Tennessee 9.9 14.1

North Carolina 5.7 7.9

Gainesville 3.7 4.7

Total Markets $ 86.5 $ 131.4

New Loan Commitments – Category and Market15

(in millions)

CATEGORY 2Q12 1Q12

Commercial RE:

Owner Occupied $ 28.0 $ 55.7

Income Producing 7.7 16.7

Total Commercial RE 35.7 72.4

Commercial C & I 23.7 39.0

Commercial Constr. 7.5 6.1

Residential 32.1 29.0

Residential Constr. 32.2 20.9

Consumer 1.2 1.2

Total Categories $ 132.4 $ 168.6

MARKET 2Q12 1Q12

Atlanta $ 54.7 $ 70.9

N. Georgia 35.0 36.3

Coastal Georgia 11.4 28.0

Tennessee 14.8 18.7

North Carolina 12.5 9.8

Gainesville 4.0 4.9

Total Markets $ 132.4 $ 168.6

Credit Quality16

(in millions)

2Q12 1Q124Q113Q112Q11

Operating Net Charge-offs(1) $ 18.9 $ 15.9$20.6$17.5$16.5

as % of Average Loans(1) 1.85 % 1.55 %1.99%1.68%1.58%

Allowance for Loan Losses $ 112.7 $ 113.6$114.5$146.1$127.6

as % of Total Loans 2.74 % 2.75 %2.79%3.55%3.07%

as % of NPLs 98 8890101180

Past Due Loans (30 89 Days) .65 % .86 %.75%.70%0.65%

Non-Performing Loans $ 115.4 $ 129.7$127.5$144.5$71.0

OREO 30.4 31.932.844.247.6

Total NPAs $ 145.8 $ 161.6$160.3$188.7$118.6

Accruing TDRs (see page 49) $ 141.6 $ 125.8$105.8$69.8$41.5

As % of Original Principal Balance

Non-Performing Loans 68.8 % 70.6 %71.3%77.8%64.5%

OREO 39.3 36.135.933.432.6

Total NPAs

as % of Total Assets 2.16 2.252.302.741.66

as % of Loans & OREO 3.51 3.883.874.542.82

(1) Excludes $25 million of charge-offs for largest loan relationship in 4Q11.

NPL Inflow Trends 17

Quarterly NPL Inflows Since 2009 ($mm)

84.8% $193.3 $200.0 $177.7 Decline $174.8 $174.9 $155.0 from Peak $139.0 $150.0 $119.8 $103.4 $100.0$81.0 $54.7 $45.7 $50.0$35.9 $32.4$29.4

$0.0

Q1 ‘09 Q2 ‘09 Q3 ‘09 Q4 ‘09 Q1 ‘10 Q2 ‘10 Q3 ‘10 Q4 ‘10Q1 ‘11Q2 ‘11Q3 ‘11Q4 ‘11Q1 ‘12Q2 ‘12

Resi Construction Com. Construction Resi. Mortgage Com. RE Commercial Consumer

($50,000)

Total NPLs ($mm)

304.4 $320.0 287.8 280.8 259.2 264.1

224.3 217.8 $240.0

179.1

144.5 $160.0 127.5 129.7

115.4 83.8 71.1 $80.0

Q1 ‘09 Q2 ‘09 Q3 ‘09 Q4 ‘09 Q1 ‘10 Q2 ‘10 Q3 ‘10 Q4 ‘10Q1 ‘11Q2 ‘11Q3 ‘11Q4 ‘11Q1 ‘12Q2 ‘12

Net Charge-offs by Loan Category18

(in thousands)

2Q12% of Average Loans (Annualized)

% of Avg

Total Loans1Q124Q12(1) 3Q11

Commercial (Sec. by RE):

Owner Occupied $ 1,305 .46 %.87%1.16%.34%

Income Producing 3,044 1.75.70.57.71

Total Comm (Sec. by RE) 4,349 .95.81.90.50

Commercial & Industrial 775 .70.621.083.54

Commercial Construction 88 .21.811.75.39

Total Commercial 5,212 .86.781.06.71

Residential Mortgage 3,862 1.381.912.042.09

Residential Construction 9,563 9.144.846.775.19

Consumer/ Installment 259 .881.721.472.75

Total Net Charge-offs $ 18,896 1.851.551.991.68

(1) Excludes charge-offs for largest loan relationship of Commerical Construction $2,863; Commercial & Industrial $17,046; CRE Income Producing $901; and, Residential Construction $4,190

Net Charge-offs by Market19

(in millions)

2Q12% of Average Loans (Annualized)

% of Avg

Total Loans1Q124Q11(1) 3Q11

North Georgia $ 12,474 3.58 %2.56%2.70%2.16%

Atlanta MSA 2,307 .75.891.37.94

North Carolina 3,634 2.521.142.102.31

Coastal Georgia 211 .231.53.41.88

Gainesville MSA (187) (.29)1.353.842.64

East Tennessee 457 .68.34.59.78

Total $ 18,896 1.851.551.991.68

(1) Excludes charge-offs for largest loan relationship of in North Georgia of $25,000

NPAs by Loan Category and Market20

(in thousands)

2Q12

NPLs OREO Total NPAs

LOAN CATEGORY

Commercial (sec. by RE):

Owner Occupied $ 9,399 $ 7,914 $ 17,313

Income Producing 9,716 2,672 12,388

Commercial & Industrial 34,982 - 34,982

Commercial Construction 18,175 2,732 20,907

Total Commercial 72,272 13,318 85,590

Residential Mortgage 16,631 5,591 22,222

Residential Construction 25,530 11,512 37,042

Consumer/ Installment 907 - 907

Total $ 115,340 $ 30,421 $ 145,761

2Q12

NPLs OREO Total NPAs

MARKETS

North Georgia $ 77,332 $ 13,546 $ 90,878

Atlanta MSA 17,593 8,651 26,244

North Carolina 10,657 3,287 13,944

Coastal Georgia 5,822 785 6,607

Gainesville MSA 991 2,998 3,989

East Tennessee 2,945 1,154 4,099

Total $ 115,340 $ 30,421 $ 145,761

FINANCIAL REVIEW

Core Earnings Summary22

(in thousands)

Variance - Incr / (Decr)

2Q121Q124Q111Q11

Net Interest Revenue $ 56,836$(2,028)$(2,214)$(2,110)

Fee Revenue 12,764(327)1,3221,668

Gross Revenue 69,600(2,355)(892)(442)

Operating Expense (Excl OREO) 41,312(1,358)(2,531)(4,368)

Pre-Tax, Pre-Credit (Core) $ 28,288$(997)$1,639$3,926

Net Interest Margin 3.43 %(.10) %(.08) %.02

Net Interest Margin23

3.79% 3.77% 3.76%

3.67% 3.62%

NIM

NIM – Core Credit(1)

(1) Excluding impact of nonaccrual loans, OREO and interest reversals

NIM Characteristics

Margin

-10 bps vs. 1Q12 +2 bps vs. 2Q11

Lowered Core and CD Deposit Pricing

Loan Pricing Pressure

2Q Excess Liquidity –Lowered Margin by 44 bps and 53 bps in Q1

Margin – Credit Costs 24

.26% .26% .24%

.23%

.19%

Credit Costs Impacting Margin

Historically 8 to 12 bps

Significant improvement after de-risking balance sheet 1Q11

Cost 2Q12 vs. Historical – 7 bps (annual earnings impact of $4.7 million)

1 bps = $667 thousand in NIR

Margin

Key Drivers of Net Interest Revenue / Margin 25

Offsetting Impacts on Margin

Loan pricing under pressure

Deposit rates continue to decline

4.74 4.76 4.79 4.79 4.72 Loan Spreads

Deposit Pricing, Excluding Brokered Deposits 26

Note – CD pricing reflects the quarter-ending new and renewed yield. MMDA / NOW pricing reflects the deposit yield for each quarter

Deposit Mix 27

(in millions)

2Q12

55%

$5.6B Public

Funds

2Q12 1Q12 2Q11 4Q08 12%

Demand &

Demand / NOW $ 1,735 $ 1,722 $ 1,620 $ 1,457 Time

NOW

>$100k

MMDA / Savings 1,330 1,331 1,174 630 31%

13%

Core Transaction 3,065 3,053 2,794 2,087

Time

<$100k

20% MMDA &

10% Growth - $271 Million Sav.

24%

+978

47% Growth

Customer

Time < $100,000 1,159 1,201 1,503 1,945

Public Deposits 623 782 605 755 4Q08

Total Core 4,847 5,036 4,902 4,787 $6.2B Public

Funds Demand & 34%

Time >$100,000 728 759 936 1,336 14% NOW

23%

Public Deposits 36 38 44 87

Total Customer 5,611 5,833 5,882 6,210

Time >$100k

22% MMDA & Sav.

Brokered Deposits 211 168 301 793 10%

Total Deposits $ 5,822 $ 6,001 $ 6,183 $ 7,003

Time <$100k

31%

Core Deposit Growth – Category and Market 28

(in millions, excluding public)

Growth

YTD

CATEGORY 2Q12 2Q12 Last 12 Mo

Demand $ 35.9 $ 143.7 $ 222.6

MM Accounts (6.2) 81.9 134.9

Savings 5.4 20.7 21.7

NOW (22.6) (82.8) (107.6)

Total Categories $ 12.5 $ 163.5 $ 271.6

Percent Growth (Annualized) 2 % 11 % 10 %

MARKET

Atlanta $ 2.9 $ 65.1 $ 130.2

North Carolina 12.8 43.3 55.3

Coastal Georgia 0.1 25.5 25.7

N. Georgia (3.5) 17.8 38.2

Tennessee (1.8) 7.5 12.7

Gainesville 2.0 4.3 9.5

Total Markets $ 12.5 $ 163.5 $ 271.6

Fee Revenue - Core 29

(in millions)

Variance - Incr / (Decr)

2Q12 1Q12 4Q11 2Q11

NSF & Overdraft Fees $ 3,232 $ (13) $ (305) $ (426)

Debit Card Fees 3,242 140 273 (37)

Other Service Charges 1,342 (94) 600 671

Total Service Charges and Fees 7,816 33 568 208

Mortgage Loan & Related Fees 2,322 223 497 1,370

Brokerage Fees 809 (4) 27 118

Other 1,817 (579) 230 (28)

Total $ 12,764 $ (327) $ 1,322 $ 1,668

Excludes net securities gains and charges on prepayment of FHLB advances, hedge ineffectiveness gains, gains from the sale of low income housing tax credits, interest on Federal income tax refund and mark to market adjustments on United’s deferred compensation plan assets.

Investment Conclusions

Operating Expenses - Core 30

(in thousands)

Variance - Incr / (Decr)

2Q12 1Q12 4Q11 2Q11

Salaries & Employee Benefits $ 23,150 $ (1,615) $ (2,388) $ (2,129)

Communications & Equipment 3,211 56 82 (167)

Occupancy 3,539 (232) (433) (266)

FDIC Assessment 2,545 35 144 (1,099)

Advertising & Public Relations 1,088 242 (101) (229)

Postage, Printing & Supplies 916 (63) (44) (169)

Professional Fees 1,952 (23) (54) (398)

Other Expense 4,911 242 263 89

$ 41,312 $ (1,358) $ (2,531) $ (4,368)

Excludes foreclosed property costs, adjustment to reclassify pension plan actuarial gains and losses and unamortized prior service costs to other comprehensive income, severance costs and mark to market adjustments on United’s deferred compensation plan liability.

Net Operating Income 31

(in thousands)

2Q12 1Q12 4Q11 2Q11

Pre-Tax, Pre-Credit (Core) $ 28,288 $ 29,285 $ 26,649 $ 24,362

Provision for Loan Loss (18,000) (15,000) (14,000) (11,000)

Foreclosed Property Costs:

Write-downs (1,008) (2,111) (3,892) (3,118)

Losses on Sales 269 (93) (3,041) 3,218

Maintenance, Taxes, Etc. (1,112) (1,621) (2,369) (1,991)

Total Foreclosed Property Costs (1,851) (3,825) (9,302) (1,891)

Hedge Ineffectiveness Gains (Losses) (180) 115 313 2,810

Securities Gains, Net 6,490 557 4 783

Losses from Prepayment of Borrowings (6,199) (482) - (791)

Gains from Sale of Low Income Housing Tax Credits - 728 728 -

Interest on Federal Income Tax Refund - 1,100 - -

Reclassification of Pension Acturial Gains and

Losses and Prior Service Costs to OCI - - 2,245 -

Severance (1,155) (190) - (1,150)

Income Tax Expense (894) (760) 3,264 (1,095)

Net Income $ 6,499 $ 11,528 $ 9,901 $ 12,028

Net Income Per Share $ .06 $ .15 $ .12 $ .16

Net Income 32

(in thousands)

2Q12 1Q12 4Q11 2Q11

Net Income $ 6,499 $ 11,528 $ 9,901 $ 12,028

Preferred Stock Dividends (3,032) (3,030) (3,025) (3,016)

Net Income Avail to Common Shareholders $ 3,467 $ 8,498 $ 6,876 $ 9,012

Net Income Per Share $ .06 $ .15 $ .12 $ .16

Tangible Book Value $ 6.48 $ 6.54 $ 6.47 $ 6.94

Shares Outstanding (millions) 57.8 57.8 57.6 57.5

Capital Ratios 33

Well- Minimum

Capitalized Guideline JUN ‘12 MAR ‘12 JUN ‘11

Bank

Tier 1 RBC 6 % 10 % 14.3 % 13.7 % 13.3 %

Total RBC 10 11 15.6 15.0 15.1

Leverage 5 8 9.2 9.0 8.3

Holding Company

Tier 1 RBC 6 10 14.2 13.7 13.6

Total RBC 10 11 15.9 15.4 16.2

Leverage 5 8 9.1 8.9 8.5

Tier I Common RBC 4.5 7 8.7 8.3 8.3

Tangible Equity to Assets 8.2 8.1 7.9

APPENDIX

Experienced Proven Leadership 35

Joined Years in

UCBI Banking

Jimmy Tallent President & CEO 1984 38

Rex Schuette Chief Financial Officer 2001 35

David Shearrow Chief Risk Officer 2007 31

Craig Metz Marketing & Retail Banking 2002 20

Regional Presidents:

Bill Gilbert North & Coastal Georgia 2000 36

Tim Schools North Carolina & Tennessee 2011 12

Glenn White Atlanta 2007 38

Business and Operating Model 36

Twenty-seven “community banks”

Local CEOs with deep roots in their communities

Resources of $6.7 billion bank

Service is point of differentiation

#1 in Customer Satisfaction according to Customer Service Profiles

J.D. Power Customer Service Champion

9 Recognized 40 companies in the U.S.

9 Only bank to be recognized

Golden rule of banking

9 “The Bank That SERVICE Built”

Ongoing customer surveys

9 95% 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”

Robust Demographics (fast growing markets)

Population Growth (%)

Population Actual Projected

Markets1(in thousands) 2000 - 2011 2011 - 2016

North Georgia 386 21 % 4 %

Atlanta MSA 5,321 25 5

Gainesville MSA 181 30 4

Coastal Georgia 385 15 5

Western North Carolina 441 15 5

East Tennessee 862 14 5

Total Markets

Georgia 9,775 19 5

North Carolina 9,659 20 7

Tennessee 6,402 13 4

United States 310,704 10 3

¹ Population data is for 2011 and includes those markets where United takes deposits.

Source: SNL

Market Share Opportunities 38

Excellent growth prospects

Market

Deposits United Deposit

Markets (in billions) (1) Deposits (2) Banks Offices Share(1) Rank(1)

North Georgia $ 6.8 $ 2.0 11 22 33 % 1

Atlanta MSA 48.2 2.0 10 38 4 7

Gainesville MSA 2.5 .3 1 5 14 3

Coastal Georgia 7.0 .3 2 8 6 7

Western North Carolina 7.3 .9 1 20 13 3

East Tennessee 15.9 .3 2 11 2 10

Total Markets $ 87.7 $ 5.8 27 104

¹ FDIC deposit market share and rank as of 6/11 for markets where United takes deposits. Source: SNL and FDIC.

2 Based on current quarter.

Leading Demographics 39

2011 ‐ 2016

Total Assets Population

Rank Ticker Company(1) State ($B) Growth(2)

1 CFR Cullen/Frost Bankers, Inc. TX 20.4 8.38

2 IBOC International Bancshares Corporation TX 11.8 6.99

3 HBHC Hancock Holding Company MS 19.3 6.38

4 PB Prosperity Bancshares, Inc. TX 10.9 6.23

5 FCNCA First Citizens BancShares, Inc. NC21.16.10

6 GBCI Glacier Bancorp, Inc. MT 7.2 5.63

7 FIBK First Interstate BancSystem, Inc. MT 7.4 5.43

8 TCBI Texas Capital Bancshares, Inc. TX 8.6 5.37

9 FCBN First Citizens Bancorporation, Inc. SC 8.3 4.87

10 UCBI United Community Banks, Inc. GA 6.7 4.85

11 BOKF BOK Financial Corporation OK 25.9 4.77

12 WAL Western Alliance Bancorporation AZ 6.9 4.56

13 IBKC IBERIABANK Corporation LA 11.8 4.42

14 STSA Sterling Financial Corporation WA 9.5 4.20

15 UMPQ Umpqua Holdings Corporation OR 11.5 3.98

NOTE: Financial information as of March 31, 2012

(1) Includes publicly traded companies with assets between $5.0 ‐ $50.0 billion as of March 31, 2012 (2) Population growth weighted by county (cumulative) Data Source: SNL Financial

Investment Conclusions

Proactively Addressing Credit Environment 40

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: o Weekly past due meetings o Weekly NPA/ORE meetings o Quarterly criticized watch loan review meetings o Quarterly pass commercial and CRE portfolio review meetings

Internal loan review of new credit relationships

Policy

Ongoing enhancements to credit policy

Periodic updates to portfolio limits

Lending – Credit Summary 41

(in millions)

Legal lending limit $158

House lending limit 20 Project lending limit 12

Top 25 relationships 404 Regional credit review – Standard underwriting

Performing Classified Loans 42

(in millions)

LOANS BY CATEGORY 2Q12 1Q12 4Q11 3Q11 2Q11

Commercial (Sec. by RE):

Owner Occupied $ 54 $ 78 $ 79 $ 69 $ 72

Income Producing 94 56 64 65 46

Total Comm (Sec. by RE) 148 134 143 134 118

Commercial & Industrial 16 17 16 25 17

Commercial Construction 38 23 18 26 31

Total Commercial 202 174 177 185 166

Residential Mortgage 73 76 76 77 70

Residential Construction 46 64 72 76 74

Consumer / Installment 3 3 3 3 3

Total Classified Loans $ 324 $ 317 $ 328 $ 341 $ 313

Business Mix Loans 43

(at quarter-end)

(in millions)

2Q12 vs.

LOANS BY CATEGORY 2Q12 1Q12 4Q11 3Q11 2Q11 2Q11

Commercial (Sec. by RE):

Owner Occupied $ 1,140 $ 1,137 $ 1,111 $ 1,037 $ 1,014 $ 126

Income Producing 697 706 711 734 728 (31)

Total Comm (Sec. by RE) 1,837 1,843 1,822 1,771 1,742 95

Commercial & Industrial 450 440 428 429 428 22

Commercial Construction 169 167 164 169 195 (26)

Total Commercial 2,456 2,450 2,414 2,369 2,365 91

Residential Mortgage 1,128 1,131 1,135 1,150 1,177 (49)

Residential Construction 409 436 448 474 502 (93)

Consumer / Installment 126 111 113 117 119 7

Total Loans $ 4,119 $ 4,128 $ 4,110 $ 4,110 $ 4,163 $ (44)

Loans – Markets Served (at quarter-end)

(in millions)

2Q12 vs.

LOANS BY MARKET 2Q12 1Q12 4Q11 3Q11 2Q11 2Q11

North Georgia $ 1,387 $ 1,408 $ 1,426 $ 1,478 $ 1,500 $ (113)

Atlanta MSA 1,252 1,239 1,220 1,192 1,188 64

North Carolina 576 588 597 607 626 (50)

Coastal Georgia 369 366 346 316 325 44

Gainesville MSA 259 262 265 272 275 (16)

East Tennessee 276 265 256 245 249 27

Total Loans $ 4,119 $ 4,128 $ 4,110 $ 4,110 $ 4,163 $ (44)

Residential Construction – North Georgia 45

(in millions)

2Q12 vs.

2Q12 1Q12 4Q11 3Q11 2Q11 2Q11

Land Loans

Developing Land $ 39 $ 44 $ 44 $ 51 $ 58 $ (19)

Raw Land 18 26 26 25 25 (7)

Lot Loans 113 113 118 124 129 (16)

Total 170 183 188 200 212 (42)

Construction Loans

Spec 9 12 12 15 18 (9)

Sold 14 11 14 14 19 (5)

Total 23 23 26 29 37 (14)

Total Res Construction $ 193 $ 206 $ 214 $ 229 $ 249 $ (56)

Residential Construction – Atlanta MSA 46

(in millions)

2Q12 vs.

2Q12 1Q12 4Q11 3Q11 2Q11 2Q11

Land Loans

Developing Land $ 14 $ 17 $ 17 $ 19 $ 20 $ (6)

Raw Land 9 13 14 15 16 (7)

Lot Loans 22 22 22 22 22 -

Total 45 52 53 56 58 (13)

Construction Loans

Spec 24 27 27 28 30 (6)

Sold 7 7 6 8 9 (2)

Total 31 34 33 36 39 (8)

Total Res Construction $ 76 $ 86 $ 86 $ 92 $ 97 $ (21)

Business Mix Loans (at year-end)

(in millions)

2011 2010 2009 2008 2007

LOANS BY CATEGORY

Commercial (Sec. by RE) $ 1,822 $ 1,761 $ 1,779 $ 1,627 $ 1,476

Commercial & Industrial 428 441 390 410 418

Commercial Construction 164 297 363 500 527

Total Commercial 2,414 2,499 2,532 2,537 2,421

Residential Mortgage 1,135 1,279 1,427 1,526 1,502

Residential Construction 448 695 1,050 1,479 1,829

Consumer / Installment 113 131 142 163 177

Total Loans $ 4,110 $ 4,604 $ 5,151 $ 5,705 $ 5,929

Markets Served 48

Loans – (at year-end)

(in millions)

LOANS BY MARKET 2011 2010 2009 2008 2007

North Georgia $ 1,426 $ 1,689 $ 1,884 $ 2,040 $ 2,060

Atlanta MSA 1,220 1,310 1,435 1,706 2,002

North Carolina 597 702 772 810 806

Coastal Georgia 346 335 405 464 416

Gainesville MSA 265 312 390 420 399

East Tennessee 256 256 265 265 246

Total Loans $ 4,110 $ 4,604 $ 5,151 $ 5,705 $ 5,929

TDRs by Loan Type

(in millions)

LOAN TYPE Accruing(1) Non-Accruing Total TDRs

As of June 30, 2012

Commercial (Sec by RE) $ 75,901 $ 6,424 $ 82,325

Commercial & Industrial 3,713 259 3,972

Commercial Construction 30,727 10,950 41,677

Total Commercial 110,341 17,633 127,974

Residential Mortgage 14,485 2,465 16,950

Residential Construction 16,450 5,728 22,178

Consumer Installment 366 145 511

Total $ 141,642 $ 25,971 $ 167,613

(1) 78 percent of accruing TDR loans have an interest rate of 4 percent of greater.

As of March 31, 2012

Commercial (Sec by RE) $ 70,293 $ 9,551 $ 79,844

Commercial & Industrial 3,288 199 3,487

Commercial Construction 17,891 16,175 34,066

Total Commercial 91,472 25,925 117,397

Residential Mortgage 12,479 2,353 14,832

Residential Construction 21,652 4,296 25,948

Consumer Installment 193 137 330

Total $ 125,796 $ 32,711 $ 158,507

NPAs by Loan Category, Market, and Activity 50

Credit Quality (1)

Second Quarter 2012 First Quarter 2012Fourth Quarter 2011

Non-performing Foreclosed Total Non-performing Foreclosed TotalNon-performingForeclosedTotal

(in thousands) Loans Properties NPAs Loans Properties NPAsLoansPropertiesNPAs

NPAs BY CATEGORY

Commercial (sec.by RE) $ 19,115 $ 10,586 $ 29,701 $ 26,081 $ 10,808 $ 36,889$27,322$9,745$37,067

Commercial & industrial 34,982 - 34,982 36,314 - 36,314 34,613-34,613

Commercial construction 18,175 2,732 20,907 23,319 3,266 26,585 16,6553,33619,991

Total commercial 72,272 13,318 85,590 85,714 14,074 99,788 78,59013,08191,671

Residential mortgage 16,631 5,591 22,222 18,741 5,882 24,623 22,3586,92729,285

Residential construction 25,530 11,512 37,042 24,341 11,931 36,272 25,52312,85138,374

Consumer installment 907 - 907 908 - 908 1,008 - 1,008

Total NPAs $ 115,340 $ 30,421 $ 145,761 $ 129,704 $ 31,887 $ 161,591 $ 127,479$32,859$160,338

Balance as a % of

Unpaid Principal 68.8% 39.3% 59.4% 70.6% 36.1% 59.4% 71.3%35.9%59.3%

NPAs BY MARKET

North Georgia $ 77,332 $ 13,546 $ 90,878 $ 81,117 $ 14,559 $ 95,676 $ 88,600$15,136$103,736

Atlanta MSA 17,593 8,651 26,244 22,321 7,647 29,968 14,4806,16920,649

North Carolina 10,657 3,287 13,944 15,765 4,650 20,415 15,1005,36520,465

Coastal Georgia 5,822 785 6,607 5,622 1,268 6,890 5,248 1,6206,868

Gainesville MSA 991 2,998 3,989 2,210 3,387 5,597 2,069 3,7605,829

East Tennessee 2,945 1,154 4,099 2,669 376 3,045 1,982 809 2,791

Total NPAs $ 115,340 $ 30,421 $ 145,761 $ 129,704 $ 31,887 $ 161,591 $ 127,479$32,859$160,338

NPA ACTIVITY

Beginning Balance $ 129,704 $ 31,887 $ 161,591 $ 127,479 $ 32,859 $ 160,338 $ 144,484$44,263$188,747

Loans placed on non-accrual 29,364 - 29,364 32,437 - 32,43745,675-45,675

Payments received (15,027) - (15,027) (5,945) - (5,945) (1,884)-(1,884)

Loan charge-offs (19,382) - (19,382) (14,733) - (14,733) (44,757)-(44,757)

Foreclosures (9,319) 9,319 - (9,534) 9,534 - (16,039)16,039-

Capitalized costs - 415 415 - 329 329 - 141 141

Note / property sales - (10,461) (10,461) - (8,631) (8,631) -(20,651)(20,651)

Write downs - (1,008) (1,008) - (2,111) (2,111) - (3,893)(3,893)

Net gains (losses) on sales - 269 269 - (93) (93) - (3,040)(3,040)

Ending Balance $ 115,340 $ 30,421 $ 145,761 $ 129,704 $ 31,887 $ 161,591 $ 127,479$32,859$160,338

(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.26

Net Charge-offs by Category and Market 51

Credit Quality (1)

Second Quarter 2012 First Quarter 2012 Fourth Quarter 2011

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-OffsLoans(2)

NET CHARGE-OFFS BY CATEGORY

Commercial (sec.by RE) $ 4,349 .95 % $ 3,697 .81 % $ 4,962 1.09 %

Commercial & industrial 775 .70 669 .62 18,940 17.47

Commercial construction 88 .21 334 .81 3,318 7.88

Total commercial 5,212 .86 4,700 .78 27,220 4.51

Residential mortgage 3,862 1.38 5,375 1.91 5,887 2.04

Residential construction 9,563 9.14 5,314 4.84 12,090 10.36

Consumer installment 259 .88 478 1.72 427 1.47

Total $ 18,896 1.85 $ 15,867 1.55 $ 45,624 4.39

NET CHARGE-OFFS BY MARKET

North Georgia $ 12,474 3.58 % $ 9,022 2.56 % $ 34,970 9.46 %

Atlanta MSA 2,307 .75 2,729 .89 4,195 1.37

North Carolina 3,634 2.52 1,679 1.14 3,180 2.10

Coastal Georgia 211 .23 1,329 1.53 335 .41

Gainesville MSA (187) (.29) 883 1.35 2,572 3.84

East Tennessee 457 .68 225 .34 372 .59

Total $ 18,896 1.85 $ 15,867 1.55 $ 45,624 4.39

(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.

Net Charge-offs by Category and Market 52

Asset Disposition Plan as of March 31, 2011

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

Asset Disposition Plan

Bulk Loan Sale (2) First Quarter

Performing Nonperforming Other Bulk LoanForeclosureOther Net2011 Net Charge-

(in thousands) Loans Loans Sales (3) Charge-Offs (4) Charge-OffsOffs

NET CHARGE-OFFS BY CATEGORY

Commercial (sec. by RE) $ 29,451 $ 11,091 $ 3,318 $ 1,905 $ 2,842$48,607

Commercial construction 32,530 15,328 292 419 1,14649,715

Commercial & industrial 365 2,303 859 - 5134,040

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

Residential construction 43,018 23,459 3,325 11,693 10,64392,138

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

Consumer / installment 86 168 30 24 383 691

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

NET CHARGE-OFFS BY MARKET

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

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

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

Western North Carolina 11,138 4,743 2,415 1,402 6,74926,447

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

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

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

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

(2) Charge-offs totaling $186 million were recognized on the bulk loan sale in the first quarter of 2011. The loans were transferred to the loans held for sale category in anticipation of the second quarter bulk loan sale that was completed on April 18, 2011.

(3) Losses on smaller bulk sale transactions completed during the first quarter of 2011.

(4) Loan charge-offs recognized in the first quarter of 2011 related to loans transferred to foreclosed properties. Such charge-offs were elevated in the first quarter as a result of the asset disposition plan, which called for aggressive write downs to expedite sales in the second and third quarters of 2011.

Credit Quality – Bulk Loan Sale Summary as of March 31, 2011

Credit Quality - Bulk Loan Sale Summary (1)

Performing Loans Nonperforming LoansTotal Loans

Carrying Charge- Loans Held Carrying Charge- Loans HeldCarryingCharge-Loans Held

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

BY CATEGORY

Commercial (sec. by RE) $ 40,902 $ 29,451 $ 11,451 $ 17,202 $ 11,090 $6,112$58,104$40,541$17,563

Commercial construction 45,490 32,530 12,960 22,440 15,3287,11267,93047,85820,072

Commercial & industrial 504 365 139 3,397 2,302 1,095 3,901 2,6671,234

Total commercial 86,896 62,346 24,550 43,039 28,720 14,319129,93591,06638,869

Residential construction 59,747 43,018 16,729 35,508 23,45912,04995,25566,47728,778

Residential mortgage 19,342 13,917 5,425 21,716 14,262 7,45441,05828,17912,879

Consumer / installment 120 86 34 238 169 69 358 255103

Total $ 166,105 $ 119,367 $ 46,738 $ 100,501 $ 66,610 $ 33,891$266,606$185,977$80,629

BY MARKET

Atlanta MSA $ 51,647 $ 37,186 $ 14,461 $ 13,755 $ 8,545 $ 5,210 $ 65,402$45,731$19,671

Gainesville MSA 4,949 3,563 1,386 3,695 2,442 1,253 8,644 6,0052,639

North Georgia 80,831 57,969 22,862 70,900 47,698 23,202151,731105,66746,064

Western North Carolina 15,468 11,138 4,330 7,228 4,743 2,485 22,69615,8816,815

Coastal Georgia 9,493 6,835 2,658 3,527 2,179 1,348 13,0209,0144,006

East Tennessee 3,717 2,676 1,041 1,396 1,003 393 5,113 3,6791,434

Total $ 166,105 $ 119,367 $ 46,738 $ 100,501 $ 66,610 $ 33,891$266,606$185,977$80,629

(1) This schedule presents a summary of classified loans included in the bulk loan sale transaction that closed on April 18, 2011.

(2) This column represents the book value, or carrying amount, of the loans prior to charge offs to mark loans to expected proceeds from sale.

(3) This column represents the charge-offs required to adjust the loan balances to the expected proceeds from the sale based on indicative bids received from prospective buyers, including principal payments received or committed advances made after the cutoff date through March 31, 2011 that are part of the settlement.

(4) This column represents the expected proceeds from the bulk sale based on indicative bids received from prospective buyers and equals the balance shown on the consolidated balance sheet as loans held for sale.

Loans / Deposits - Liquidity 54

(in millions)

Variance

2Q12 1Q12 2Q11 vs 1Q12 vs 2Q11

Loans $ 4,119 $ 4,128 $ 4,163 $ (9) $ (44)

Core (DDA, MMDA, Savings) $ 3,065 $ 3,053 $ 2,794 $ 12 $ 271

Public Funds 659 820 649 (161) 10

CD’s 1,887 1,960 2,439 (73) (552)

Total Deposits (excl Brokered) $ 5,611 $ 5,833 $ 5,882 $ (222) $ (271)

Loan to Deposit Ratio 73% 71% 71%

Investment Securities:

Available for Sale $ 1,259 $ 1,359 $ 1,194 $ (100) $ 65

Held to Maturity 283 304 371 (21) (88)

Total Investment Securities 1,542 1,663 1,565 (121) (23)

Floating Rate CMD, Bonds 442 540 623 (98) (181)

Total Securities Portfolio 1,984 2,203 2,188 (219) (204)

Percent of Assets (Excludes Floating) 19% 23% 22%

Commercial Paper & Reverse Repo $ 120 $ 235 $ 175 $ (115) $ (55)

Floating Rate Securities 442 540 623 (98) (181)

Excess Reserves 94 103 42 (9) 52

Total Excess Liquidity $ 656 $ 878 $ 840 $ (222) $ (184)

Wholesale Borrowings - Liquidity 55

(in millions)

Unused Variance

Capacity 2Q12 1Q12 2Q11 vs 1Q12 vs 2Q11

Wholesale Borrowings

(1)

Brokered Deposits $ 1,474 $ 211 $ 168 $ 301 $ 43 $ (90)

FHLB 629 125 215 41 (90) 84

Fed Funds 125 - - - - -

Other Wholesale 478 54 102 104 (48) (50)

Total $ 2,706 $ 390 $ 485 $ 446 $ (95) $ (56)

Long-Term Debt

Sub-Debt $ 65 $ 65 $ 95 $ - $ (30)

Trust Preferred Securities 55 55 55 - -

Total Long-Term Debt $ 120 $ 120 $ 150 $ - $ (30)

(1) Estimated Brokered Deposit Total Capacity at 25% of Assets

Deposits 56

Business Mix – at quarter-end

(in millions)

2Q12 vs.

DEPOSITS BY CATEGORY 2Q12 1Q12 4Q11 3Q11 2Q11 2Q11

Demand & Now $ 1,735 $ 1,722 $ 1,674 $ 1,686 $ 1,620 $ 115

MMDA & Savings 1,330 1,331 1,228 1,220 1,174 156

Core Transaction Deposits 3,065 3,053 2,902 2,906 2,794 271

Time < $100,000 1,159 1,201 1,326 1,387 1,503 (344)

Public Deposits 623 782 844 597 605 18

Total Core Deposits 4,847 5,036 5,072 4,890 4,902 (55)

Time > $100,000 728 759 807 867 936 (208)

Public Deposits 36 38 40 38 44 (8)

Total Customer Deposits 5,611 5,833 5,919 5,795 5,882 (271)

Brokered Deposits 211 168 179 210 301 (90)

Total Deposits $ 5,822 $ 6,001 $ 6,098 $ 6,005 $ 6,183 $ (361)

Core Transaction Deposits 57

Geographic Diversity

Core Transactions / Total Deposits (%)

2Q12 2Q11

2Q 11 2Q 12

$ in millions Coastal GA 64.0 % 42.4 %

Eastern Tennessee

Gainesville MSA 59.4 53.1

North Carolina 57.9 50.3

Gainesville MSA

Atlanta MSA 57.0 50.4

East TN 56.5 48.5

Coastal Georgia

North Georgia 51.2 51.1

North Carolina Total 54.3 % 47.5 %

North Georgia

Atlanta MSA

Non GAAP Reconciliation Tables 58

(in thousands except EPS)

Operating Earnings to GAAP Earnings Reconciliation

2Q12 1Q12 2Q11

Core net interest revenue reconciliation

Core net interest revenue $ 56,836 $ 58,864 $ 58,946

Taxable equivalent adjustment (444) (446) (429)

Net interest revenue (GAAP) $ 56,392 $ 58,418 $ 58,517

Core fee revenue reconciliation

Core fee revenue $ 12,764 $ 13,091 $ 11,096

Securities gains, net 6,490 557 783

Loss on prepayment of borrowings (6,199) (482) (791)

Gains from sales of low income housing tax credits - 728 -

Hedge ineffectiveness (losses) gains (180) 115 2,810

Interest on Federal tax refund - 1,100 -

Mark to market on deferred compensation plan assets (8) 270 7

Fee revenue (GAAP) $ 12,867 $ 15,379 $ 13,905

Core operating expense reconciliation

Core operating expense $ 41,312 $ 42,670 $ 45,680

Foreclosed property expense 1,851 3,825 1,891

Severance 1,155 190 1,150

Mark to market on deferred compensation plan liability (8) 270 7

Operating expense (GAAP) $ 44,310 $ 46,955 $ 48,728

Non GAAP Reconciliation Tables 59

Operating Earnings to GAAP Earnings Reconciliation

2Q12 1Q12 2Q11

Net interest margin - pre credit reconciliation

Net interest margin - pre credit 3.62 % 3.76 % 3.67 %

Effect of interest reversals, lost interest, and carry costs of NPAs (.19) (.23) (.26)

Net interest margin 3.43 3.53 3.41

Tangible common equity and tangible equity to tangible assets reconciliation

Tangible common equity to tangible assets 5.45 % 5.33 % 1.37 %

Effect of preferred equity 2.79 2.75 6.56

Tangible equity to tangible assets 8.24 8.08 7.93

Effect of goodwill and other intangibles .09 .11 .13

Equity to assets (GAAP) 8.33 % 8.19 % 8.06 %

Tangible common equity to risk-weighted assets reconciliation

Tangible common equity to risk-weighted assets 8.38 % 8.21 % 8.69 %

Effect of preferred equity 4.36 4.23 4.20

Tangible equity to risk weighted assets 12.74 12.44 12.89

Effect of other comprehensive income .28 .10 (.42)

Effect of trust preferred 1.19 1.15 1.15

Tier I capital ratio (Regulatory) 14.21 % 13.69 % 13.62 %

Analyst Coverage

United Community Banks, Inc.

Investor Presentation

Second Quarter 2012