8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  January 29, 2008

Independence Bancshares, Inc.

(Exact name of registrant

as specified in its charter)

South Carolina	333-121485	20-1734180
(State or other	(Commission	(I.R.S. Employer
jurisdiction of	File Number)	Identification No.)
incorporation)

500 East Washington Street, Greenville, South Carolina 29601

(Address of principal executive offices)              (Zip Code)

Registrant’s telephone number, including area code:  (864) 672-1776

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 (see General Instruction A.2. below):

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 January 29, 2008, Independence Bancshares, Inc., the bank holding company for Independence National Bank, issued a letter to its shareholders announcing its financial results for the year ended December 31, 2007.

Certain statements in the attached document contain “forward-looking statements,” such as statements relating to future plans and expectations.  Such forward-looking statements are subject to risks and uncertainties, such as a downturn in the economy, greater than expected non-interest expenses or excessive loan losses, which could cause actual results to differ materially from future plans and expectations expressed or implied by such forward-looking statements. For a more detailed description of factors that could cause such differences, please see our filings with the SEC.

Although we believe that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove to be inaccurate.  Therefore, we can give no assurance that the results contemplated in the forward-looking statements will be realized.  The inclusion of this forward-looking information should not be construed as a representation by our company or any person that future events, plans, or expectations contemplated by our company will be achieved.  We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

A copy of the communication to shareholders is attached hereto as Exhibit 99.1.

ITEM 9.01	FINANCIAL STATEMENTS AND EXHIBITS
(d)	Exhibits.

The following exhibit is filed as part of this report:

Exhibit
Number	Description
99.1	Communication to Shareholders for year ended December 31, 2007.

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SIGNATURES

                Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

INDEPENDENCE BANCSHARES, INC.
By:	/s/ Lawrence R. Miller
Name:	Lawrence R. Miller
Title:	Chief Executive Officer

Dated: January 29, 2008

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EXHIBIT INDEX

Exhibit
Number	Description
99.1	Communication to Shareholders for year ended December 31, 2007.

4

EX-99.1

Exhibit 99.1

January 29, 2008

Dear Shareholder:

We are pleased to report the results of our fourth quarter ended December 31, 2007 and our second full year of operations.  We have experienced solid growth during 2007 and are excited about a strong start to 2008.

At December 31, 2007, total assets were $110.5 million, increasing $2.4 million, or 2%, from September 30, 2007, and $34.8 million, or 46%, from December 31, 2006.  Total gross loans outstanding were $98.9 million, increasing $4.5 million, or 5%, from September 30, 2007, and $35.9 million, or 57%, from December 31, 2006.  The allowance for loan losses as a percentage of total gross loans outstanding was 1.30% at both December 31, 2007 and September 30, 2007. Total deposits as of December 31, 2007 were $82.1 million, decreasing $1.0 million, or 1%, from September 30, 2007, and increasing $25.2 million, or 44%, from December 31, 2006.  At December 31, 2007, brokered deposits, included in total deposits, were $35.2 million compared to $34.9 million at September 30, 2007.  Growth in brokered deposits was used to fund loan growth during the quarter.

For the quarter ended December 31, 2007, operations resulted in net income of $204,942.  For the year ended December 31, 2007, net income was $322,193.  We recognized $987,306 in net interest income for the quarter ended December 31, 2007, compared to $962,216 for the quarter ended September 30, 2007, an increase of $25,090, or 3%.  Net income for the quarter and year ended December 31, 2007 includes a tax benefit of $154,800 and $216,500, respectively.  This is a result of the reduction in a valuation allowance on deferred tax assets after an analysis of the evidence supporting the future usage of net operating loss carry-forwards through projected  taxable income.  We expect our tax rate to be normalized in 2008.  We continue to focus on quality growth in loans and deposits, which we believe will drive growth in net interest income and profitability in future quarters.

Last quarter we announced the opening of our new full-service branch on Wade Hampton Boulevard in Taylors, SC, which is off to a great start.  We are now in the process of building our third location in Simpsonville, SC at the intersection of Highways 14 and 417.  We believe this third location will further enable us to serve our clients in a more efficient and convenient manner and will increase our recognition in upstate South Carolina.

Independence National Bank is a full service commercial bank, providing traditional loan and deposit services, as well as online banking, commercial cash management, remote deposit capture, and other essential services for our clients.  We strive to maintain a personal focus and are dedicated to meeting the needs of our clients.  We value your support as a shareholder.  Please do not hesitate to contact us with any questions.

Best Regards,

Lawrence R. Miller	Charles D. Walters
President & CEO	Chairman of the Board

Financial Highlights

(unaudited)

Balance Sheet	As of
Data	12/31/2007		09/30/2007		12/31/2006
Total assets	$	110,511,245	$	108,159,443	$	75,730,333
Loans, gross	98,891,370		94,351,555		62,953,196
Allowance for loan losses	1,283,491		1,222,991		1,198,152
Deposits	82,133,117		83,179,745		56,906,716
Shareholders’ equity	18,989,433		18,706,893		18,473,469

Income Statement Data	For the Year Ended 12/31/2007		For the Quarter Ended 12/31/2007		For the Quarter Ended 09/30/2007
Net interest income	$	3,670,148	$	987,306	$	962,216
Provision for loan losses	483,000		60,500		109,500
Non-interest income	62,491		25,333		10,367
Non-interest expense	3,143,946		901,997		843,650
Net income, net of tax	322,193		204,942		43,233
Net income, per diluted share	0.15		0.10		0.02

Quarterly Net Interest Income ($ in thousands)

Quarter End Gross Loans Outstanding ($ in millions)

Quarter End Deposits Outstanding ($ in millions)

Quarter End Total Assets ($ in millions)

Certain statements in this document contain “forward-looking statements,” such as statements relating to future plans and expectations.  Such forward-looking statements are subject to risks and uncertainties, such as a downturn in the economy, greater than expected non-interest expenses, regulatory changes and excessive loan losses, which could cause actual results to differ materially from future plans and expectations expressed or implied by such forward-looking statements.  For a more detailed description of factors that could cause such differences, please see our filings with the SEC.

STOCK TRANSFER AGENT

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Investor Relations Department

10 Commerce Drive

Cranford, NJ  07016-3572

(800) 368-5948

Registrar & Transfer Company makes it possible for you to update shareholder information online.  If you have had a change in address or other shareholder information, visit www.rtco.com, click on investor relations, and make your changes now!

FINANCIAL INFORMATION

Shareholders, analysts, and others seeking financial information should contact:

Ms. Katie N. Tuttle

Chief Financial Officer

Independence Bancshares, Inc.

P. O. Box 1776

Greenville, SC  29602

500 E. Washington Street

Greenville, SC  29601

(864) 672-1776

24 Hour Account Access

(800) 657-7670

www.IndependenceNB.com