10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

Amendment No. 1

(Mark One)

TQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended   June 30, 2009

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition period from __________________ to _______________________

Commission File Number 000-21329

TIB FINANCIAL CORP.

(Exact name of registrant as specified in its charter)

FLORIDA		65-0655973
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
599 9th STREET NORTH, SUITE 101, NAPLES, FLORIDA 34102-5624
(Address of principal executive offices) (Zip Code)
	(239) 263-3344
(Registrant’s telephone number, including area code)
	Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  TYes   £No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  £Yes   £No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “accelerated filer”, “ large accelerated filer” and  “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one):
£ Large accelerated filer	£ Accelerated filer
T Non-accelerated filer	£ Smaller reporting company
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  £Yes    TNo
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:
Common Stock, $0.10 Par Value		14,747,870
Class		Outstanding as of July 31, 2009

Explanatory Note

TIB Financial Corp. previously filed its June 30, 2009 Form 10-Q on August 10, 2009. This Amendment No. 1 to Form 10-Q is being filed because the tables on page 19 under the heading Assets and Liabilities Measured on a Non-Recurring Basis in Note 8 – Fair Value of the Notes to Unaudited Consolidated Financial Statements of Item 1 – Financial Statements, were inadvertently omitted in the original filing. Additionally, the tables on page 19 of the original filing were inadvertently included and have been deleted from this amendment. No other changes to the original filing have been made, however the entirety of Item 1 is included herein for the convenience of the reader. Pursuant to Securities and Exchange Commission rules, the Company is including currently dated certifications as Exhibits 31 and 32.

TIB FINANCIAL CORP.

FORM 10-Q

For the Quarter Ended June 30, 2009

INDEX

PART I.  FINANCIAL INFORMATION
	ITEM 1.	FINANCIAL STATEMENTS	3
PART II.  OTHER INFORMATION
	ITEM 6.	EXHIBITS	20

2

PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

TIB FINANCIAL CORP. CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except per share data)
	June 30, 2009			December 31, 2008
	(Unaudited)
Assets
Cash and due from banks	$	82,178		$	69,607
Federal funds sold and securities purchased under agreements to resell		14,684			4,127
Cash and cash equivalents		96,862			73,734
Investment securities available for sale		358,452			225,770
Loans, net of deferred loan costs and fees		1,239,711			1,224,975
Less: Allowance for loan losses		25,446			23,783
Loans, net		1,214,265			1,201,192
Premises and equipment, net		40,999			38,326
Goodwill		6,361			5,160
Intangible assets, net		7,445			3,010
Accrued interest receivable and other assets		72,697			62,922
Total Assets	$	1,797,081		$	1,610,114
Liabilities and Shareholders’ Equity
Liabilities
Deposits:
Noninterest-bearing demand	$	182,236		$	128,384
Interest-bearing		1,212,582			1,007,284
Total deposits		1,394,818			1,135,668
Federal Home Loan Bank (FHLB) advances		125,000			202,900
Short-term borrowings		84,114			71,423
Long-term borrowings		63,000			63,000
Accrued interest payable and other liabilities		18,181			16,009
Total liabilities		1,685,113			1,489,000
Shareholders’ equity
Preferred stock – $.10 par value: 5,000,000 shares authorized, 37,000 shares issued and outstanding, liquidation preference of $37,000		33,354			32,920
Common stock - $.10 par value: 40,000,000 shares authorized, 14,820,597 shares issued,  14,747,870 shares outstanding		1,482			1,482
Additional paid in capital		74,323			73,163
Retained earnings		4,259			14,737
Accumulated other comprehensive loss		(881	)		(619	)
Treasury stock, at cost, 72,727 shares		(569	)		(569	)
Total shareholders’ equity		111,968			121,114
Total Liabilities and Shareholders’ Equity	$	1,797,081		$	1,610,114
See accompanying notes to consolidated financial statements

3

TIB FINANCIAL CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(Dollars in thousands, except per share amounts)

	Three months ended June 30,						Six months ended June 30,
	2009			2008			2009			2008
Interest and dividend income
Loans, including fees	$	17,352		$	19,278		$	35,191		$	39,428
Investment securities:
Taxable		3,410			1,928			6,314			3,706
Tax-exempt		74			101			149			213
Interest-bearing deposits in other banks		20			33			40			44
Federal Home Loan Bank stock		-			125			(19	)		252
Federal funds sold and securities purchased under agreements to resell		2			312			5			1,056
Total interest and dividend income		20,858			21,777			41,680			44,699
Interest expense
Deposits		7,151			7,882			15,050			17,008
Federal Home Loan Bank advances		1,279			1,315			2,685			2,798
Short-term borrowings		26			352			50			904
Long-term borrowings		708			819			1,444			1,724
Total interest expense		9,164			10,368			19,229			22,434
Net interest income		11,694			11,409			22,451			22,265
Provision for loan losses		5,763			5,716			11,072			8,370
Net interest income after provision for loan losses		5,931			5,693			11,379			13,895
Non-interest income
Service charges on deposit accounts		1,202			719			2,168			1,441
Investment securities gains (losses), net		95			(1,912	)		691			(1,002	)
Fees on mortgage loans originated and sold		318			213			433			445
Investment advisory and trust fees		228			136			421			261
Other income		489			475			998			947
Total non-interest income		2,332			(369	)		4,711			2,092
Non-interest expense
Salaries and employee benefits		7,068			6,358			14,448			12,411
Net occupancy and equipment expense		2,438			2,186			4,590			4,200
Other expense		6,652			3,320			10,487			8,279
Total non-interest expense		16,158			11,864			29,525			24,890
Loss before income taxes		(7,895	)		(6,540	)		(13,435	)		(8,903	)
Income tax benefit		(3,008	)		(2,506	)		(5,090	)		(3,424	)
Net Loss	$	(4,887	)	$	(4,034	)	$	(8,345	)	$	(5,479	)
Income earned by preferred shareholders		650			-			1,358			-
Net loss allocated to common shareholders	$	(5,537	)	$	(4,034	)	$	(9,703	)	$	(5,479	)
Basic and diluted loss per common share	$	(0.38	)	$	(0.28	)	$	(0.66	)	$	(0.39	)

See accompanying notes to consolidated financial statements

4

TIB FINANCIAL CORP.

Consolidated Statements of Changes in Shareholders’ Equity

(Unaudited)

(Dollars in thousands, except share and per share amounts)

	Preferred Shares		Preferred Stock		Common Shares		Common Stock		Additional Paid in Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Shareholders’ Equity
Balance, April 1, 2009		37,000	$	33,166		14,747,870	$	1,482	$	73,783	$	10,204		$	(214	)	$	(569	)	$	117,852
Comprehensive loss:
Net loss												(4,887	)								(4,887	)
Other comprehensive loss, net of tax
Net market valuation adjustment on securities available for sale															(608	)
Less: reclassification adjustment for gains, net of tax of $36															(59	)
Other comprehensive loss, net of tax benefit of $403:																					(667	)
Comprehensive loss																					(5,554	)
Preferred stock discount accretion				188								(188	)								-
Stock-based compensation and related tax effect										133											133
Common stock dividend declared										407		(407	)								-
Cash dividends declared, preferred stock												(463	)								(463	)
Balance, June 30, 2009		37,000	$	33,354		14,747,870	$	1,482	$	74,323	$	4,259		$	(881	)	$	(569	)	$	111,968

	Preferred Shares		Preferred Stock		Common Shares		Common Stock		Additional Paid in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Shareholders’ Equity
Balance, April 1, 2008		-	$	-		14,716,250	$	1,479	$	66,154		$	36,690		$	(311	)	$	(569	)	$	103,443
Comprehensive loss:
Net loss													(4,034	)								(4,034	)
Other comprehensive loss, net of tax
Net market valuation adjustment on securities available for sale																(1,595	)
Add: reclassification adjustment for losses, net of tax of $719																1,193
Other comprehensive loss, net of tax benefit of $248:																						(402	)
Comprehensive loss																						(4,436	)
Restricted stock grants, net of 1,133 cancellations						27,242		3		(3	)											-
Private placement of common shares										(11	)											(11	)
Stock-based compensation and related tax effect										153												153
Common stock dividend declared										834			(834	)								-
Balance, June 30, 2008		-	$	-		14,743,492	$	1,482	$	67,127		$	31,822		$	(713	)	$	(569	)	$	99,149

(Continued)

5

TIB FINANCIAL CORP.

Consolidated Statements of Changes in Shareholders’ Equity

(Unaudited)

(Dollars in thousands, except share and per share amounts)

	Preferred Shares		Preferred Stock		Common Shares		Common Stock		Additional Paid in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Shareholders’ Equity
Balance, January 1, 2009		37,000	$	32,920		14,747,870	$	1,482	$	73,163		$	14,737		$	(619	)	$	(569	)	$	121,114
Comprehensive loss:
Net loss													(8,345	)								(8,345	)
Other comprehensive loss, net of tax
Net market valuation adjustment on securities available for sale																169
Less: reclassification adjustment for gains, net of tax of $260																(431	)
Other comprehensive loss, net of tax benefit of $158:																						(262	)
Comprehensive loss																						(8,607	)
Issuance costs associated with preferred stock issued										(48	)											(48	)
Preferred stock discount accretion				434									(434	)								-
Stock-based compensation and related tax effect										332												332
Common stock dividends declared										876			(876	)								-
Cash dividends declared, preferred stock													(823	)								(823	)
Balance, June 30, 2009		37,000	$	33,354		14,747,870	$	1,482	$	74,323		$	4,259		$	(881	)	$	(569	)	$	111,968

	Preferred Shares		Preferred Stock		Common Shares		Common Stock		Additional Paid in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Shareholders’ Equity
Balance, January 1, 2008		-	$	-		13,434,240	$	1,351	$	56,067		$	39,151		$	240		$	(569	)	$	96,240
Cumulative-effect adjustment for split-dollar life insurance postretirement benefit													(141	)								(141	)
Comprehensive loss:
Net loss													(5,479	)								(5,479	)
Other comprehensive loss, net of tax
Net market valuation adjustment on securities available for sale																(1,578	)
Add: reclassification adjustment for losses, net of tax of $377																625
Other comprehensive loss, net of tax benefit of $597:																						(953	)
Comprehensive loss																						(6,432	)
Restricted stock grants, net of 1,461 cancellations						32,486		3		(3	)											-
Private placement of common shares						1,261,212		126		9,810												9,936
Exercise of stock options						15,554		2		96												98
Stock-based compensation and related tax effect										323												323
Common stock dividends declared										834			(834	)								-
Cash dividends declared, $.0595 per share													(875	)								(875	)
Balance, June 30, 2008		-	$	-		14,743,492	$	1,482	$	67,127		$	31,822		$	(713	)	$	(569	)	$	99,149

6

TIB FINANCIAL CORP. CONSOLIDATED STATEMENTS OF CASH FLOWS INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (Unaudited) (Dollars in thousands)
	Six Months Ended June 30,
	2009			2008
Cash flows from operating activities:
Net loss	$	(8,345	)	$	(5,479	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		2,216			1,982
Provision for loan losses		11,072			8,370
Deferred income tax benefit		(6,461	)		(2,870	)
Investment securities net realized gains		(1,454	)		(910	)
Net amortization of investment premium/discount		847			(36	)
Write-down of investment securities		763			1,912
Stock-based compensation		370			345
Loss on sales of OREO		178			-
Other		260			(147	)
Mortgage loans originated for sale		(23,297	)		(26,267	)
Proceeds from sales of mortgage loans		21,706			29,850
Fees on mortgage loans sold		(395	)		(441	)
Change in accrued interest receivable and other assets		1,452			(3,025	)
Change in accrued interest payable and other liabilities		1,772			3,216
Net cash provided by operating activities		684			6,500
Cash flows from investing activities:
Purchases of investment securities available for sale		(497,814	)		(70,451	)
Sales of investment securities available for sale		290,916			25,016
Repayments of principal and maturities of investment securities available for sale		105,489			25,405
Acquisition of Naples Capital Advisors business		-			(1,365	)
Net cash received in assumption of operations - Riverside Bank of the Gulf Coast		271,398			-
Net (purchase) sale of FHLB stock		1,277			(1,269	)
Loans originated or acquired, net of principal repayments		(22,490	)		(75,935	)
Purchases of premises and equipment		(1,252	)		(661	)
Proceeds from sale of OREO		2,038			-
Proceeds from disposal of premises, equipment and intangible assets		18			14
Net cash provided by (used in) investing activities		149,580			(99,246	)
Cash flows from financing activities:
Net increase in demand, money market and savings accounts		85,803			21,583
Net increase (decrease) in time deposits		(52,486	)		17,373
Net change in Brokered time deposits		(93,399	)		49,276
Net increase (decrease) in federal funds purchased and securities sold under agreements to repurchase		11,755			2,454
Increase in long term FHLB advances		-			57,900
Repayment of long term FHLB advances		(7,900	)		(75,000	)
Net change in short term FHLB advances		(70,000	)		45,000
Proceeds from exercise of stock options		-			98
Income tax effect related to stock-based compensation		(38	)		(22	)
Proceeds from private stock offering		-			9,936
Net issuance costs of preferred stock and common warrants		(48	)		-
Cash dividends paid to common shareholders		-			(1,674	)
Cash dividends paid to preferred shareholders		(823	)		-
Net cash provided by (used in) financing activities		(127,136	)		126,924
Net increase in cash and cash equivalents		23,128			34,178
Cash and cash equivalents at beginning of period		73,734			71,059
Cash and cash equivalents at end of period	$	96,862		$	105,237
Supplemental disclosures of cash paid:
Interest	$	18,857		$	22,176
Income taxes		-			125
Supplemental information:
Fair value of noncash assets acquired	$	49,193		$	-
Fair value of liabilities assumed		320,594			-
Transfer of loans to OREO		8,780			-
Transfer of OREO to Premises and Equipment		2,942			-
See accompanying notes to consolidated financial statements

7

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

Note 1 – Basis of Presentation & Accounting Policies

TIB Financial Corp. is a bank holding company headquartered in Naples, Florida, whose business is conducted primarily through our wholly-owned subsidiaries, TIB Bank, The Bank of Venice, and Naples Capital Advisors, Inc. Together with its subsidiaries, TIB Financial Corp. (collectively the “Company”) has a total of twenty-eight full service banking offices in Monroe, Miami-Dade, Collier, Lee, and Sarasota counties, Florida. On February 13, 2009, TIB Bank acquired the deposits (excluding brokered deposits), branch office operations and certain assets from the FDIC as receiver of the former Riverside Bank of the Gulf Coast (“Riverside”). Accordingly, subsequent to the acquisition, the operations of TIB Bank include the results of the operations of Riverside.

The accompanying unaudited consolidated financial statements for the Company have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statement presentation.  For further information and an additional description of the Company’s accounting policies, refer to the Company’s annual report on Form 10-K for the year ended December 31, 2008.

The consolidated statements include the accounts of TIB Financial Corp. and its wholly-owned subsidiaries, TIB Bank, The Bank of Venice, and Naples Capital Advisors, Inc.  All significant inter-company accounts and transactions have been eliminated in consolidation.  Management has evaluated subsequent events for reporting and disclosure in these financial statements through August 7, 2009. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.  Certain amounts previously reported have been reclassified to conform to the current period presentation. The share and per share amounts discussed throughout this document have been adjusted to account for the effects of five one percent stock dividends distributed July 17, 2008, October 10, 2008, January 10, 2009, April 10, 2009 and July 10, 2009 to shareholders of record on July 7, 2008, September 30, 2008, December 31, 2008, March 31, 2009 and June 30, 2009, respectively.

As used in this document, the terms “we,” “us,” “our,” “TIB Financial,” and “Company” mean TIB Financial Corp. and its subsidiaries (unless the context indicates another meaning) and the term “Banks” means TIB Bank and The Bank of Venice.

Critical Accounting Policies

The accounting and reporting policies of the Company are in accordance with accounting principles generally accepted within the United States of America and conform to general practices within the banking industry.

Allowance for Loan Losses

The allowance for loan losses is a valuation allowance for probable incurred credit losses, which is increased by the provision for loan losses and decreased by charge-offs less recoveries.  Loan losses are charged against the allowance when management believes the uncollectiblity of a loan balance is confirmed.  Subsequent recoveries, if any, are credited to the allowance.  Management estimates the allowance balance required based on factors including past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations and estimated collateral values, economic conditions, and other factors.  Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management’s judgment, should be charged off.

The allowance consists of specific and general components.  The specific component relates to loans that are impaired and are individually classified as special mention, substandard or doubtful.  The general component covers non-classified loans and is based on historical loss experience adjusted for current factors.

A loan is considered impaired when it is probable that not all principal and interest amounts will be collected according to the loan contract.  Individual commercial, commercial real estate and residential loans exceeding certain size thresholds established by management are individually evaluated for impairment.  If a loan is considered to be impaired, a portion of the allowance is allocated so that the loan is reported net, at the present value of estimated future cash flows using the loan’s existing rate or at the fair value of collateral if repayment is expected solely from the collateral.  Generally, large groups of smaller balance homogeneous loans, such as consumer, indirect, and residential real estate loans (other than those evaluated individually), are collectively evaluated for impairment, and accordingly, they are not separately identified for impairment disclosures.

Investment Securities and Other Than Temporary Impairment

Investment securities which management has the ability and intent to hold to maturity are reported at amortized cost.  Debt securities which may be sold prior to maturity are classified as available for sale and are carried at fair value, with unrealized holding gains and losses reported in other comprehensive income. Other securities such as Federal Home Loan Bank stock are carried at cost and are included in other assets on the balance sheets.

Interest income includes amortization of purchase premium or discount.  Premiums and discounts on securities are amortized on the level-yield method without anticipating prepayments, except for mortgage backed securities where prepayments are anticipated. Gains and losses on sales are recorded on the trade date and determined using the specific identification method based on the amortized cost of the security sold.

8

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

Management regularly reviews each investment security for impairment based on criteria that include the extent to which cost exceeds fair value, the duration of that market decline, the financial health of and specific prospects for the issuer(s) and our ability and intention with regard to holding the security to maturity. Future declines in the fair value of these or other securities may result in additional impairment charges which may be material to the financial condition and results of operations of the Company.

Management evaluates securities for other-than-temporary impairment (“OTTI”) at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. The investment securities portfolio is evaluated for OTTI by segregating the portfolio into two general segments and applying the appropriate OTTI model. Investment securities classified as available for sale or held-to-maturity are generally evaluated for OTTI under Statement of Financial Accounting Standards (“SFAS”) No. 115, Accounting for Certain Investments in Debt and Equity Securities. However, certain purchased beneficial interests, including non-agency mortgage-backed securities, asset-backed securities, and collateralized debt obligations, that had credit ratings at the time of purchase of below AAA are evaluated using the model outlined in EITF Issue No. 99-20, Recognition of Interest Income and Impairment on Purchased Beneficial Interests and Beneficial Interests that Continue to be Held by a Transfer in Securitized Financial Assets.

In determining OTTI under the SFAS No. 115 model, management considers many factors, including: (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) whether the market decline was affected by macroeconomic conditions, and (4) whether the entity has the intent to sell the debt security or more likely than not will be required to sell the debt security before its anticipated recovery. The assessment of whether an other-than-temporary decline exists involves a high degree of subjectivity and judgment and is based on the information available to management at a point in time.

The second segment of the portfolio uses the OTTI guidance provided by EITF 99-20 that is specific to purchased beneficial interests that, on the purchase date, were rated “AA” or “A”. Under the EITF 99-20 model, the Company compares the present value of the remaining cash flows as estimated at the preceding evaluation date to the current expected remaining cash flows. An OTTI is deemed to have occurred if there has been an adverse change in the remaining expected future cash flows.

When OTTI occurs under either model, the amount of the impairment recognized in earnings depends on whether we intend to sell the security or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis, less any current-period credit loss. If we intend to sell or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis, less any current-period credit loss, the impairment is required to be recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. If we do not intend to sell the security and it is not more likely than not that we will be required to sell the security before recovery of its amortized cost basis less any current-period loss, the impairment shall be separated into the amount representing the credit loss and the amount related to all other factors. The amount of impairment related to the credit loss is determined based on the present value of cash flows expected to be collected and is recognized in earnings. The amount of the impairment related to other factors is recognized in other comprehensive income, net of applicable taxes. The previous amortized cost basis less the OTTI recognized in earnings becomes the new amortized cost basis of the investment.

Earnings Per Common Share

Basic earnings (loss) per share is net income (loss) allocated to common shareholders divided by the weighted average number of common shares and vested restricted shares outstanding during the period. Diluted earnings per share includes the dilutive effect of additional potential common shares issuable under stock options,  warrants and restricted shares computed using the treasury stock method.

Additional information with regard to the Company’s methodology and reporting of the allowance for loan losses and earnings per common share is included in the 2008 Annual Report on Form 10-K.

Acquisitions

The Company accounts for its business combinations based on the acquisition method of accounting. The acquisition method of accounting requires the Company to determine the fair value of the tangible net assets and identifiable intangible assets acquired. The fair values are based on available information and current economic conditions at the date of acquisition. The fair values may be obtained from independent appraisers, discounted cash flow present value techniques, management valuation models, quoted prices on national markets or quoted market prices from brokers. These fair value estimates will affect future earnings through the disposition or amortization of the underlying assets and liabilities. While management believes the sources utilized to arrive at the fair value estimates are reliable, different sources or methods could have yielded different fair value estimates. Such different fair value estimates could affect future earnings through different values being utilized for the disposition or amortization of the underlying assets and liabilities acquired.

Goodwill

The Company has approximately $6,361 of goodwill arising primarily from the 2007 acquisition of The Bank of Venice and, to a lesser extent, the acquisitions of Riverside and Naples Capital Advisors. Goodwill is subject to an assessment for impairment annually or more frequently if indicators of impairment are present during an interim reporting period. The Company performed its annual review of goodwill for potential impairment as of December 31, 2008 and an interim assessment as of June 30, 2009.  Based on these reviews, it was determined that no impairment existed as of June 30, 2009 or December 31, 2008.

9

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

Income Taxes

Income tax expense (or benefit) is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method.  Under this method, the net deferred tax asset or liability is determined based on the tax effects of the temporary differences between the book and tax basis of the various balance sheet assets and liabilities and gives current recognition to changes in tax rates and laws.

A valuation allowance related to deferred tax assets is required when it is considered more likely than not that all or part of the benefit related to such assets will not be realized. Based on the Company’s earnings history and projected future taxable income, management has determined that no valuation allowance was required at June 30, 2009 or December 31, 2008.Management regularly analyzes the need for valuation allowances against deferred tax assets. If our future operating results vary significantly from our currently projected future taxable income, future analyses may result in the need for or subsequent increases in such valuation allowances which may be material to the financial condition and results of operations of the Company.

Recent Accounting Pronouncements

In December 2007, the FASB issued Statement of Financial Accounting Standards No. 141 (revised 2007), “Business Combinations” (“FAS 141(R)”), which revises Statement 141. FAS 141(R) requires the acquiring entity in a business combination to recognize all (and only) the assets acquired and liabilities assumed in the transaction; establishes the acquisition-date fair value as the measurement objective for all assets acquired and liabilities assumed; and requires the acquirer to disclose to investors and other users all of the information needed to evaluate and understand the nature and financial effect of the business combination. FAS 141(R) is effective for fiscal years beginning after December 15, 2008. Adoption on January 1, 2009, as required, did not have a material effect on the Company’s financial condition, results of operations or liquidity. FAS 141(R) was applied in accounting for the Riverside acquisition and will impact future acquisitions.

In December 2007, the FASB issued Statement of Financial Accounting Standards No. 160, “Noncontrolling Interests in Consolidated Financial Statements” (“FAS 160”), which requires all entities to report noncontrolling (minority) interests in subsidiaries as equity in the consolidated financial statements. Additionally, FAS 160 requires that transactions between an entity and noncontrolling interests be treated as equity transactions. FAS 160 is effective for fiscal years beginning after December 15, 2008. Adoption on January 1, 2009, as required, did not have a material effect on the Company’s financial condition, results of operations or liquidity.

In March 2008, the FASB issued Statement No. 161 “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133”. SFAS No. 161 requires enhanced disclosures about how and why an entity uses derivative instruments, how derivative instruments and related items are accounted for under Statement 133 and how derivative instruments and related hedged items affect an entity’s financial position, financial performance and cash flows. The new standard is effective for the Company on January 1, 2009 and adoption, as required, did not have a material effect on the Company’s financial condition, results of operations or liquidity.

In April 2009, the FASB issued Staff Position (FSP) No. 115-2 and No. 124-2, “Recognition and Presentation of Other-Than-Temporary Impairments,” which amends existing guidance for determining whether impairment is other-than-temporary (“OTTI”) for debt securities.  The FSP requires an entity to assess whether it intends to sell, or it is more likely than not that it will be required to sell a security in an unrealized loss position before recovery of its amortized cost basis.  If either of these criteria is met, the entire difference between amortized cost and fair value is recognized in earnings.  For securities that do not meet the aforementioned criteria, the amount of impairment recognized in earnings is limited to the amount related to credit losses, while impairment related to other factors is recognized in other comprehensive income.    Additionally, the FSP expands and increases the frequency of existing disclosures about other-than-temporary impairments for debt and equity securities.  This FSP is effective for interim and annual reporting periods ending after June 15, 2009, with early adoption permitted for periods ending after March 15, 2009.  The adoption of the FSP on April 1, 2009 did not have a material impact on the results of operations or financial position of the Company. During the three months ended June 30, 2009, the Company recognized $740 of OTTI charges in income. Had the standard not been issued, there would not have been a material difference in the amount of OTTI that would have been recognized.

In April 2009, the FASB issued Staff Position (FSP) No. 157-4, “Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly.”  This FSP emphasizes that even if there has been a significant decrease in the volume and level of activity, the objective of a fair value measurement remains the same.  Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction (that is, not a forced liquidation or distressed sale) between market participants.  The FSP provides a number of factors to consider when evaluating whether there has been a significant decrease in the volume and level of activity for an asset or liability in relation to normal market activity.   In addition, when transactions or quoted prices are not considered orderly, adjustments to those prices based on the weight of available information may be needed to determine the appropriate fair value.  The FSP also requires increased disclosures.  This FSP is effective for interim and annual reporting periods ending after June 15, 2009, and is required to be applied prospectively.  The adoption of this FSP at June 30, 2009 did not have a material impact on the results of operations or financial position of the Company.

In April 2009, the FASB issued FSP No. 107-1 and APB 28-1, “Interim Disclosures about Fair Value of Financial Instruments.” This FSP amends FASB Statement No. 107, “Disclosures about Fair Value of Financial Instruments”, to require disclosures about fair value of financial instruments for interim reporting periods of publicly traded companies that were previously only required in annual financial statements. This FSP is effective for interim reporting periods ending after June 15, 2009.  The adoption of this FSP at June 30, 2009 did not have a material impact on the results of operations or financial position as it only required disclosures which are included in Note 8.

In April 2009, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 111 (“SAB 111”). SAB 111 amends Topic 5.M. in the Staff Accounting Bulletin series entitled “Other Than Temporary Impairment of Certain Investments Debt and Equity Securities.” On April 9, 2009, the FASB issued FASB Staff Position No. FAS 115-2 and FAS 124-2, “Recognition and Presentation of Other-Than-Temporary Impairments,” To provide guidance for assessing whether an impairment of a debt security is other than temporary. SAB 111 maintains the previous views related to equity securities and amends Topic 5.M. to exclude debt securities from its scope. SAB 111 is effective for the Company beginning April 1, 2009. The adoption of this SAB on April 1, 2009 did not have a material impact on the results of operations or financial position of the Company.

10

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

In May 2009, the FASB issued Statement No. 165, “Subsequent Events” which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. In particular, this Statement sets forth the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements, and the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. In accordance with this Statement, an entity should apply the requirements to interim or annual financial periods ending after June 15, 2009. The impact of adoption did not have a material impact on the results of operations or financial position of the Company.

In June 2009, the FASB issued Statement No. 166, “Accounting for Transfers of Financial Assets—an amendment of FASB Statement No. 140.” This statement removes the concept of a qualifying special-purpose entity from Statement 140 and removes the exception from applying FASB Interpretation No. 46 (revised December 2003), “Consolidation of Variable Interest Entities”, to qualifying special-purpose entities. The objective in issuing this Statement is to improve the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial statements about a transfer of financial assets; the effects of a transfer on its financial position, financial performance, and cash flows; and a transferor’s continuing involvement, if any, in transferred financial assets. This Statement must be applied as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period and for interim and annual reporting periods thereafter. Management is currently evaluating this standard but does not expect the impact of adoption to be material to the results of operations or financial position of the Company.

In June 2009, the FASB issued Statement No. 168, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles—a replacement of FASB Statement No. 162.” This statement establishes the FASB Accounting Standards Codification as the source of authoritative U.S. generally accepted accounting principles (GAAP) recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of this Statement, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other nongrandfathered non-SEC accounting literature not included in the Codification will become nonauthoritative. This Statement is effective for financial statements issued for interim and annual periods ending after September 15, 2009. Management is currently evaluating this standard but does not expect the impact of adoption to be material to the results of operations or financial position of the Company.

Note 2 – Investment Securities

The amortized cost, estimated fair value and the related gross unrealized gains and losses recognized in accumulated other comprehensive income of investment securities available for sale at June 30, 2009 and December 31, 2008 are presented below:

	June 30, 2009
	Amortized Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value
U.S. Government agencies and corporations	$	61,016	$	96	$	79	$	61,033
States and political subdivisions—tax exempt		7,753		168		1		7,920
States and political subdivisions—taxable		2,360		-		91		2,269
Marketable equity securities		12		7		-		19
Mortgage-backed securities -  residential		275,266		3,418		474		278,210
Money market mutual funds		5,582		-		-		5,582
Corporate bonds		2,874		-		1,559		1,315
Collateralized debt obligations		5,000		-		2,896		2,104
	$	359,863	$	3,689	$	5,100	$	358,452

	December 31, 2008
	Amortized Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value
U.S. Government agencies and corporations	$	50,892	$	776	$	-	$	51,668
States and political subdivisions—tax exempt		7,751		59		21		7,789
States and political subdivisions—taxable		2,407		-		70		2,337
Marketable equity securities		12		-		-		12
Mortgage-backed securities -  residential		157,066		1,332		421		157,977
Corporate bonds		2,870		-		1,158		1,712
Collateralized debt obligations		5,763		-		1,488		4,275
	$	226,761	$	2,167	$	3,158	$	225,770

Proceeds from sales and calls of securities available for sale were $130.2 million and $357.8 million for the three and six months ended June 30, 2009, respectively. Gross gains of approximately $624 and $836 and gross losses of approximately $6 and $0 were realized on these sales during the three and six months ended June 30, 2009, respectively.

11

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

The estimated fair value of investment securities available for sale at June 30, 2009 and December 31, 2008, by contractual maturity, are shown as follows. Expected maturities may differ from contractual maturities because borrowers may have the right to call or repay obligations without call or prepayment penalties.  Securities not due at a single maturity date, primarily mortgage-backed securities, are shown separately.

	June 30, 2009
		Fair Value		Amortized Cost
Due in one year or less		$	5,729	$	5,727
Due after one year through five years			64,786		64,655
Due after five years through ten years			4,066		4,014
Due after ten years			5,643		10,189
Marketable equity securities			18		12
Mortgage-backed securities - residential			278,210		275,266
		$	358,452		359,863

Securities with unrealized losses not recognized in income are as follows:

	Less than 12 Months				12 Months or Longer				Total
June 30, 2009	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
U.S. Government agencies and corporations	$	6,931	$	79	$	-	$	-	$	6,931	$	79
States and political subdivisions—tax exempt		-		-		274		1		274		1
States and political subdivisions—taxable		2,224		91		-		-		2,224		91
Mortgage-backed securities - residential		41,109		223		13,645		251		54,754		474
Corporate bonds		-		-		1,315		1,559		1,315		1,559
Collateralized debt obligation		-		-		2,104		2,896		2,104		2,896
Total temporarily impaired	$	50,264	$	393	$	17,338	$	4,707	$	67,602	$	5,100

	Less than 12 Months				12 Months or Longer				Total
December 31, 2008	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
U.S. Government agencies and corporations	$	-	$	-	$	-	$	-	$	-	$	-
States and political subdivisions—tax exempt		2,413		20		274		1		2,687		21
States and political subdivisions-taxable		2,247		70		-		-		2,247		70
Mortgage-backed securities - residential		14,045		83		17,015		338		31,060		421
Corporate bonds		-		-		1,712		1,158		1,712		1,158
Collateralized debt obligations		-		-		3,512		1,488		3,512		1,488
Total temporarily impaired	$	18,705	$	173	$	22,513	$	2,985	$	41,218	$	3,158

Other-Than-Temporary-Impairment

The Company views the unrealized losses in the above table to be temporary in nature for the following reasons.  First, the declines in fair values are mostly due to an increase in spreads due to risk and volatility in financial markets.  Excluding the corporate bonds and collateralized debt obligations, these securities are primarily AAA rated securities and have experienced no significant deterioration in value due to credit quality concerns and the magnitude of the unrealized losses of approximately 3% or less of the amortized cost of those securities with losses is consistent with normal fluctuations of value due to the volatility of market interest rates.  We own a corporate bond of a large financial institution and a collateralized debt obligation secured by debt obligations of banks and insurance companies which are each currently rated “B”, whose fair values have declined more than 10% below their original cost.  We believe these declines in fair value relate to a significant widening of interest rate spreads associated with these  securities. While these securities have experienced deterioration in credit quality, we have evaluated these securities and have determined that these securities have not experienced a credit loss. As we have the intent and ability to hold these securities until their fair market value recovers, they are not other than temporarily impaired as of June 30, 2009.

12

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

As of June 30, 2009, the Company owned three collateralized debt obligation investment securities (backed primarily by corporate debt obligations of homebuilders, REITs, real estate companies and commercial mortgage backed securities) with an aggregate original cost of $9,996.  In determining the estimated fair value of these securities, management utilizes a discounted cash flow modeling valuation approach which is discussed in greater detail in Note 8 - Fair Value. These securities are floating rate securities which were rated "A" or better by an independent and nationally recognized rating agency at the time of purchase. In late December 2007, these securities were downgraded below investment grade by a nationally recognized rating agency. Due to the ratings downgrade, increased defaults by the underlying issuers and the significant decline in estimated fair value, management concluded that the loss of value was other than temporary under generally accepted accounting principles and the Company wrote these investment securities down to their estimated fair value. This resulted in the recognition of other than temporary impairment loss of $3,885 in 2007.  During 2008, management concluded that the further declines in values were other than temporary under generally accepted accounting principles due to increased defaults by the underlying issuers. Accordingly, the Company wrote-down these investment securities by an additional $5,348 to their estimated fair value of $763 as of December 31, 2008 due to further defaults by the underlying issuers.  In 2009, the Company wrote-down these investment securities by $763 to a remaining balance of zero due to further defaults by the underlying issuers.

Management regularly reviews each investment security for impairment based on criteria that include the extent to which cost exceeds market price, the duration of that market decline, the financial health of and specific prospects for the issuer(s) and our ability and intention with regard to holding the security to maturity. Future declines in the fair value of these or other securities may result in additional impairment charges which may be material to the financial condition and results of operations of the Company.

Management evaluates securities for other-than-temporary impairment (“OTTI”) at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. The investment securities portfolio is evaluated for OTTI by segregating the portfolio into two general segments and applying the appropriate OTTI model. Investment securities classified as available for sale or held-to-maturity are generally evaluated for OTTI under Statement of Financial Accounting Standards (“SFAS”) No. 115, Accounting for Certain Investments in Debt and Equity Securities. However, certain purchased beneficial interests, including non-agency mortgage-backed securities, asset-backed securities, and collateralized debt obligations, that had credit ratings at the time of purchase of below AA are evaluated using the model outlined in EITF Issue No. 99-20, Recognition of Interest Income and Impairment on Purchased Beneficial Interests and Beneficial Interests that Continue to be Held by a Transfer in Securitized Financial Assets.

In determining OTTI under the SFAS No. 115 model, management considers many factors, including: (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) whether the market decline was affected by macroeconomic conditions, and (4) whether the entity has the intent to sell the debt security or more likely than not will be required to sell the debt security before its anticipated recovery. The assessment of whether an other-than-temporary decline exists involves a high degree of subjectivity and judgment and is based on the information available to management at a point in time.

The second segment of the portfolio uses the OTTI guidance provided by EITF 99-20 that is specific to purchased beneficial interests that, on the purchase date, were rated “AA” or “A”. Under the EITF 99-20 model, the Company compares the present value of the remaining cash flows as estimated at the preceding evaluation date to the current expected remaining cash flows. An OTTI is deemed to have occurred if there has been an adverse change in the remaining expected future cash flows.

When OTTI occurs under either model, the amount of the impairment recognized in earnings depends on whether we intend to sell the security or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis, less any current-period credit loss. If we intend to sell or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis, less any current-period credit loss, the impairment is required to be recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. If we do not intend to sell the security and it is not more likely than not that we will be required to sell the security before recovery of its amortized cost basis less any current-period loss, the impairment shall be separated into the amount representing the credit loss and the amount related to all other factors. The amount of impairment related to the credit loss is determined based on the present value of cash flows expected to be collected and is recognized in earnings. The amount of the impairment related to other factors is recognized in other comprehensive income, net of applicable taxes. The previous amortized cost basis less the OTTI recognized in earnings becomes the new amortized cost basis of the investment.

As of June 30, 2009, the Company’s security portfolio consisted of 93 securities positions, 13 of which were in an unrealized loss position. The majority of unrealized losses are related to the Company’s collateralized debt obligation, corporate bonds and mortgage-backed and other securities, as discussed below:

Mortgage-backed securities

At June 30, 2009, the Company owned residential mortgage backed securities guaranteed by U.S. Government agencies and corporations. The fair values of certain of these securities have declined since we acquired them due to wider spreads required by the market.

Corporate bonds

At June 30, 2009, the Company owned corporate bonds issued by one of the largest banking and financial institutions in the United States. The bond has been downgraded to “B” due to increased credit concerns. The institution has received significant capital investment from the United States Treasury under the Capital Purchase Program/TARP and its financial performance is beginning to improve. As the Company does not have the intent to sell this security and it is likely that it will not be required to sell the security before its anticipated recovery, the Company does not consider this security to be other-than-temporarily impaired at June 30, 2009.

13

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

Collateralized debt obligation

The Company owns a collateralized debt security collateralized by trust preferred securities issued primarily by banks and several insurance companies. Our analysis of this investment falls within the scope of EITF 99-20. This security was rated high quality “AA” at the time of purchase, but at June 30, 2009 nationally recognized rating agencies rated this security as “B.” The Company compares the present value of expected cash flows to the previous estimate to ensure there are no adverse changes in cash flows during the quarter. The Company utilizes a discounted cash flow valuation model which considers the structure and term of the CDO and the financial condition of the underlying issuers. Specifically, the model details interest rates, principal balances of note classes and underlying issuers, the timing and amount of interest and principal payments of the underlying issuers, and the allocation of the payments to the note classes. The current estimate of expected cash flows is based on the most recent trustee reports and any other relevant market information including announcements of interest payment deferrals or defaults by issuers of the underlying trust preferred securities. Assumptions used in the model include expected future default rates and prepayments. We treat all interest payment deferrals as defaults even though they may not actually result in defaults. Upon completion of analysis, our model indicated that the security was not other-than-temporarily impaired as of June 30, 2009 because a credit loss had not been incurred. Additionally, we use the model to evaluate alternative scenarios with higher than expected default assumptions to evaluate the sensitivity of our default assumptions and the level of additional defaults required before a credit loss would be incurred.  This security remained classified as available for sale at June 30, 2009, and accounted for the $2,896 of unrealized loss in the collateralized debt obligation category at June 30, 2009.

The table below presents a rollforward of the credit losses recognized in earnings for the three month period ended June 30, 2009:

	Three Months Ended June 30, 2009
Beginning balance, April 1, 2009	$	9,256
Additions/Subtractions
Credit losses recognized during the quarter		740
Ending balance, June 30, 2009	$	9,996

Note 3 – Loans

Major classifications of loans are as follows:

	June 30,  2009		December 31, 2008
Real estate mortgage loans:
Commercial	$	683,763	$	658,516
Residential		222,260		205,062
Farmland		13,497		13,441
Construction and vacant land		139,425		147,309
Commercial and agricultural loans		67,214		71,352
Indirect auto loans		63,243		82,028
Home equity loans		38,100		34,062
Other consumer loans		10,854		11,549
Total loans		1,238,356		1,223,319
Net deferred loan costs		1,355		1,656
Loans, net of deferred loan costs	$	1,239,711	$	1,224,975

Note 4 – Allowance for Loan Losses

Activity in the allowance for loan losses for the six months ended June 30, 2009 and 2008 follows:

	Six Months Ended June 30,
	2009			2008
Balance, January 1	$	23,783		$	14,973
Provision for loan losses charged to expense		11,072			8,370
Loans charged off		(9,533	)		(6,751	)
Recoveries of loans previously charged off		124			35
Balance, June 30	$	25,446		$	16,627

14

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

Nonaccrual loans were as follows:

	As of June 30, 2009				As of March 31, 2009				As of December 31, 2008
Loan Type	Number of Loans		Outstanding Balance		Number of Loans		Outstanding Balance		Number of Loans		Outstanding Balance
Residential 1-4 family		24	$	5,138		15	$	3,815		18	$	4,014
Commercial 1-4 family investment		9		8,705		10		7,892		9		7,943
Commercial and agricultural		6		596		8		659		2		64
Commercial real estate		21		11,322		20		13,719		18		13,133
Land development		11		34,583		6		17,707		4		12,584
Government guaranteed loans		3		145		3		143		3		143
Indirect auto, auto and consumer loans		121		1,320		162		1,712		155		1,895
			$	61,809			$	45,647			$	39,776

Impaired loans were as follows:

	June 30, 2009			March 31, 2009		December 31, 2008
Loans with no allocated allowance for loan losses		$	37,112	$	27,289	$	8,344
Loans with allocated allowance for loan losses			66,493		60,783		53,765
Total		$	103,605	$	88,072	$	62,109
Amount of the allowance for loan losses allocated		$	8,484	$	7,947	$	6,116

Note 5 – Earnings Per Share and Common Stock

Earnings per share have been computed based on the following weighted average number of common shares outstanding for the three and six months ended June 30, 2009 and 2008:

	Three Months Ended June 30,				Six Months Ended June 30,
	2009		2008		2009		2008
Basic		14,669,107		14,631,184		14,661,879		14,157,535
Dilutive effect of options outstanding		-		-		-		-
Dilutive effect of unvested restricted stock awards		-		-		-		-
Dilutive effect of warrants		-		-		-		-
Diluted		14,669,107		14,631,184		14,661,879		14,157,535

The dilutive effect of stock options and warrants and the dilutive effect of unvested restricted shares are the only common stock equivalents for purposes of calculating diluted earnings per common share.

Weighted average anti-dilutive stock options and warrants and unvested restricted shares excluded from the computation of diluted earnings per share are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2009		2008		2009		2008
Anti-dilutive stock options		675,155		619,152		684,044		579,771
Anti-dilutive unvested restricted stock awards		76,066		84,584		85,893		80,263
Anti-dilutive warrants		2,356,647		1,261,212		2,356,647		796,920

Note 6 – Capital Adequacy

The Company (on a consolidated basis) and the Banks are subject to various regulatory capital requirements administered by federal and state banking agencies. Failure to meet minimum capital requirements result in certain discretionary actions by regulators that could have an effect on the Company’s operations. The regulations require the Company and the Banks to meet specific capital adequacy guidelines that involve quantitative measures of assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The Company’s capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. On July 2, 2009, TIB Bank entered into a Memorandum of Understanding, which is an informal agreement, with Bank regulatory agencies that it will move in good faith to increase its Tier 1 leverage capital ratio to not less than 8% and its total risk-based capital ratio to not less than 12% by December 31, 2009 and maintain these higher ratios for as long as this agreement is in effect. On April 27, 2009, The Bank of Venice entered into a Memorandum of Understanding with Bank regulatory agencies which provides for the attainment of these higher ratios by September 30, 2009.

15

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

To be considered well capitalized and adequately capitalized (as defined) under the regulatory framework for prompt corrective action, the Banks must maintain minimum Tier 1 leverage, Tier 1 risk-based, and total risk-based capital ratios. These minimum ratios along with the actual ratios for the Company and the Banks at June 30, 2009 and December 31, 2008, are presented in the following table.

	Well Capitalized Requirement			Adequately Capitalized Requirement			June 30, 2009 Actual			December 31, 2008 Actual
Tier 1 Capital (to Average Assets)
Consolidated		N/A			≥ 4.0	%		6.4	%		8.9	%
TIB Bank		≥ 5.0	%		≥ 4.0	%		6.5	%		7.3	%
The Bank of Venice		≥ 5.0	%		≥ 4.0	%		6.5	%		8.1	%
Tier 1 Capital (to Risk Weighted Assets)
Consolidated		N/A			≥ 4.0	%		8.9	%		11.3	%
TIB Bank		≥ 6.0	%		≥ 4.0	%		8.8	%		9.3	%
The Bank of Venice		≥ 6.0	%		≥ 4.0	%		10.5	%		11.2	%
Total Capital (to Risk Weighted Assets)
Consolidated		N/A			≥ 8.0	%		10.1	%		12.6	%
TIB Bank		≥ 10.0	%		≥ 8.0	%		10.0	%		10.5	%
The Bank of Venice		≥ 10.0	%		≥ 8.0	%		11.7	%		12.4	%

Note 7 – Acquisition

On February 13, 2009, the Company purchased the deposits of Riverside Bank of the Gulf Coast (“Riverside”), a failed bank based in Cape Coral, Florida, from the Federal Deposit Insurance Corporation for a deposit premium of $4,126, representing 1.3% of deposits.  Under the acquisition method of accounting, the acquired assets and assumed liabilities of Riverside were recorded at their respective estimated fair values and are included in the accompanying balance sheet as of June 30, 2009. Acquisition accounting adjustments will be amortized or accreted into income over the estimated lives of the related assets and liabilities.  At the time of the acquisition, the Company had an option for 30 days to purchase loans.  In the second quarter, the Company purchased an additional $9,733 of loans from the FDIC.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed in connection with the acquisition:

Cash and cash equivalents	$	271,398
Securities available for sale		31,850
Loans		10,737
Intangible assets		5,087
Goodwill		1,201
Other		321
Total assets acquired	$	320,594
Deposits (including deposit premium on certificates of deposit)		319,232
Other liabilities		1,362
Total liabilities assumed	$	320,594

Riverside operated from nine branch banking offices of which eight were owned and one was leased. Subsequent to the acquisition, the Company had an option to assume the lease for the leased office and to purchase the eight owned offices for fair value which was determined by appraisal. Currently, the Company has elected to assume the lease and purchase six offices. Of the two offices the Company did not acquire, one was closed and the other is expected to be moved to a nearby location.  As a result of this acquisition, the Company has expanded its customer base and market presence in Southwest Florida.

Note 8 – Fair Value

FASB Statement 157 establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

16

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

The fair values of securities available for sale are determined by 1) obtaining quoted prices on nationally recognized securities exchanges when available (Level 1 inputs), 2) matrix pricing, which is a mathematical technique widely used in the financial markets to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs) and 3) for collateralized debt obligations, custom discounted cash flow modeling (Level 3 inputs).

Valuation of collateralized debt securities

As of June 30, 2009, the Company owned three collateralized debt obligations where the underlying collateral is comprised primarily of corporate debt obligations of homebuilders, REITs, real estate companies and commercial mortgage backed securities. The company also owned a collateralized debt security where the underlying collateral is comprised primarily of trust preferred securities of banks and insurance companies. The inputs used in determining the estimated fair value of these securities are Level 3 inputs. In determining their estimated fair value, management utilizes a discounted cash flow modeling valuation approach. Discount rates utilized in the modeling of these securities are estimated based upon a variety of factors including the market yields of publicly traded trust preferred securities of larger financial institutions and other non-investment grade corporate debt. Cash flows utilized in the modeling of these securities were based upon actual default history of the underlying issuers and varying assumptions of estimated future defaults of issuers. The valuation approach for the collateralized debt obligations did not change during 2009.

Valuation of Impaired loans

The fair value of impaired loans with specific allocations of the allowance for loan losses is generally based on recent real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value.

Assets and Liabilities Measured on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis are summarized below:

	Fair Value Measurements at June 30, 2009 Using
	June 30, 2009		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
U.S. Government agencies and corporations	$	61,033	$	-	$	61,033	$	-
States and political subdivisions—tax exempt		7,920		-		7,920		-
States and political subdivisions—taxable		2,269		-		2,269		-
Marketable equity securities		19		-		19		-
Mortgage-backed securities - residential		278,210		-		278,210		-
Money Market Mutual Funds		5,582		5,582		-		-
Corporate bonds		1,315		-		1,315		-
Collateralized debt obligations		2,104		-		-	$	2,104
Available for sale securities	$	358,452	$	5,582	$	350,766	$	2,104

17

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

	Fair Value Measurements at December 31, 2008 Using
	December 31, 2008		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs  (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
U.S. Government agencies and corporations	$	51,668	$	-	$	51,668	$	-
States and political subdivisions—tax exempt		7,789		-		7,789		-
States and political subdivisions—taxable		2,337		-		2,337		-
Marketable equity securities		12		-		12		-
Mortgage-backed securities - residential		157,977		-		157,977		-
Corporate bonds		1,712		-		1,712		-
Collateralized debt obligations		4,275		-		-		4,275
Available for sale securities	$	225,770	$	-	$	221,495	$	4,275

The table below presents a reconciliation and income statement classification of gains and losses for all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the quarters ended June 30, 2009 and 2008 and still held at June 30, 2009 and 2008, respectively.

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Collateralized Debt Obligations
	2009			2008
Beginning balance, April 1,	$	3,958		$	5,657
Included in earnings – other than temporary impairment		(740	)		(956	)
Included in other comprehensive income		(1,114	)		454
Transfer in to Level 3		-			4,718
Ending balance June 30,	$	2,104		$	9,873

The table below presents a reconciliation and income statement classification of gains and losses for all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the six months ended June 30, 2009 and 2008 and still held at June 30, 2009 and 2008, respectively.

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Collateralized Debt Obligations
	2009			2008
Beginning balance, January 1,	$	4,275		$	6,111
Included in earnings – other than temporary impairment		(763	)		(956	)
Included in other comprehensive income		(1,408	)		-
Transfer in to Level 3		-			4,718
Ending balance June 30,	$	2,104		$	9,873

18

TIB Financial Corp.

Unaudited Notes to Consolidated Financial Statements

(Dollars in thousands except for share and per share amounts)

Assets and Liabilities Measured on a Non-Recurring Basis

Assets and liabilities measured at fair value on a non-recurring basis are summarized below:

	Fair Value Measurements at June 30, 2009 Using
	June 30, 2009		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Impaired loans with specific allocations of the allowance for loan losses	$	58,009	$	-	$	-	$	58,009
Other real estate owned		7,142		-		-		7,142
Other repossessed assets		431		-		431		-

	Fair Value Measurements at December 31, 2008 Using
	December 31, 2008		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Impaired loans with specific allocations of the allowance for loan losses	$	47,649	$	-	$	-	$	47,649

Impaired loans, which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a carrying amount of $66,493, with a valuation allowance of $8,484 as of June 30, 2009. As a result, $3,907 and $6,000 of the allowance for loan losses was specifically allocated to these loans during the quarter and six months ended June 30, 2009, respectively. The amounts of the specific allocations for impairment are considered in the overall determination of the reserve and provision for loan losses. As of December 31, 2008, impaired loans had a carrying amount of $53,765, with a valuation allowance of $6,116. Other real estate owned which is measured at the lesser of fair value less costs to sell or our recorded investment in the foreclosed loan had a carrying amount of $8,258, less a valuation allowance of $1,115 as of June 30, 2009. As a result of sales of foreclosed properties, receipt of updated appraisals, reduced listing prices or entering into contracts to sell these properties, write downs of fair value of $871 and $983 were recognized in our statements of operations during the three and six months ended June 30, 2009, respectively. Other repossessed assets are primarily comprised of repossessed automobiles and are measured at fair value as of the date of repossession. As a result of the disposition of repossessed vehicles, gains of $36 and $105 were recognized in our statements of operations during the three and six months ended June 30, 2009, respectively.

The carrying amounts and estimated fair values of financial instruments, at June 30, 2009 are as follows:

	June 30, 2009
	Carrying Value		Estimated Fair Value
Financial assets:
Cash and cash equivalents	$	96,862	$	96,862
Investment securities available for sale		358,452		358,452
Loans, net		1,214,265		1,088,245
Federal Home Loan Bank and Independent Bankers’ Bank stock		10,735	NM
Accrued interest receivable		6,668		6,668
Financial liabilities:
Non-contractual deposits		708,224		708,224
Contractual deposits		686,594		693,157
Federal Home Loan Bank Advances		125,000		132,527
Short-term borrowings		84,114		84,108
Long-term repurchase agreements		30,000		30,887
Subordinated debentures		33,000		14,138
Accrued interest payable		8,383		8,383

The methods and assumptions used to estimate fair value are described as follows:

Carrying amount is the estimated fair value for cash and cash equivalents, interest bearing deposits, accrued interest receivable and payable, demand deposits or deposits that reprice frequently and fully.  The methods for determining the fair values for securities and impaired loans were described previously.  For loans, fixed rate deposits and for deposits with infrequent repricing or repricing limits, fair value is based on discounted cash flows using current market rates. For loans, these market rates reflect significantly wider current credit spreads applied to the estimated life.  Fair value of debt is based on current rates for similar financing.  It was not practicable to determine the fair value of FHLB stock due to restrictions placed on its transferability.  The fair value of off balance sheet items is not considered material.

19

PART II.  OTHER INFORMATION

Item 6.  Exhibits

 (a) Exhibits

Exhibit 31.1	-	Chief Executive Officer’s certification required under Section 302 of Sarbanes-Oxley Act of 2002
Exhibit 31.2	-	Chief Financial Officer’s certification required under Section 302 of Sarbanes-Oxley Act of 2002
Exhibit 32.1	-	Chief Executive Officer’s certification required under Section 906 of Sarbanes-Oxley Act of 2002
Exhibit 32.2	-	Chief Financial Officer’s certification required under Section 906 of Sarbanes-Oxley Act of 2002

20

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 thereunto duly authorized.

	TIB FINANCIAL CORP.
Date:  August 18, 2009	/s/ Thomas J. Longe
	Thomas J. Longe Chief Executive Officer and President
Date:  August 18, 2009	/s/ Stephen J. Gilhooly
	Stephen J. Gilhooly Executive Vice President, Chief Financial Officer and Treasurer

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Thomas J. Longe, Chief Executive Officer and President, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of TIB Financial Corp.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-(e)), and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5.   The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:           August 18, 2009	/s/ Thomas J. Longe
	Thomas J. Longe Chief Executive Officer and President

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Stephen J. Gilhooly, Executive Vice President and CFO, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of TIB Financial Corp.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-(e)), and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5.   The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:         August 18, 2009	/s/ Stephen J. Gilhooly
	Stephen J. Gilhooly Executive Vice President, Chief Financial Officer and Treasurer

EX-32.1

Exhibit 32.1

Chief Executive Officer’s Certification required under Section 906 of Sarbanes-Oxley Act of 2002

In connection with the quarterly report of TIB Financial Corp. (the “Company”) on Form 10-Q for the period ended June 30, 2009, as filed with the Securities and Exchange Commission (the “Report”), I, Thomas J. Longe, Chief Executive Officer and President of the Company, certify pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that this Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that, to my knowledge, the information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

Date:          August 18, 2009	/s/ Thomas J. Longe
	Thomas J. Longe Chief Executive Officer and President

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to TIB Financial Corp. and will be retained by TIB Financial Corp. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

Chief Financial Officer’s Certification required under Section 906 of Sarbanes-Oxley Act of 2002

In connection with the quarterly report of TIB Financial Corp. (the “Company”) on Form 10-Q for the period ended June 30, 2009, as filed with the Securities and Exchange Commission (the “Report”), I, Stephen J. Gilhooly, Executive Vice President and Chief Financial Officer of the Company, certify pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that this Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that, to my knowledge, the information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

Date:          August 18, 2009	/s/ Stephen J. Gilhooly
	Stephen J. Gilhooly Executive Vice President, Chief Financial Officer and Treasurer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to TIB Financial Corp. and will be retained by TIB Financial Corp. and furnished to the Securities and Exchange Commission or its staff upon request.