ASSETS ACQUIRED IN FDIC-ASSISTED ACQUISITIONS (Tables)

9 Months Ended

Sep. 30, 2012

Schedule of Acquisition Details

From October 2009 through July 2012, the Company participated in ten FDIC-assisted acquisitions whereby the Company purchased certain failed institutions out of the FDIC’s receivership. These institutions include:

Bank Acquired	Location:	Branches:	Date Acquired
American United Bank (“AUB”)	Lawrenceville, Ga.	1	October 23, 2009
United Security Bank (“USB”)	Sparta, Ga.	2	November 6, 2009
Satilla Community Bank (“SCB”)	St. Marys, Ga.	1	May 14, 2010
First Bank of Jacksonville (“FBJ”)	Jacksonville, Fl.	2	October 22, 2010
Tifton Banking Company (“TBC”)	Tifton, Ga.	1	November 12, 2010
Darby Bank & Trust (“DBT”)	Vidalia, Ga.	7	November 12, 2010
High Trust Bank (“HTB”)	Stockbridge, Ga.	2	July 15, 2011
One Georgia Bank (“OGB”)	Midtown Atlanta, Ga.	1	July 15, 2011
Central Bank of Georgia (“CBG”)	Ellaville, Ga.	5	February 24, 2012
Montgomery Bank & Trust (“MBT”)	Ailey, Ga.	2	July 6, 2012

Estimated Fair Values of Loans Acquired

The estimated fair values of loans acquired in the CBG acquisition are detailed below based on their initial estimate of credit quality (dollars in thousands):

	Loans with deterioration of credit quality		Loans without a deterioration of credit quality		Total loans, at fair value
Commercial, industrial, agricultural	$	1,256	$	6,288	$	7,544
Real estate – residential		22,389		22,213		44,602
Real estate – commercial & farmland		34,458		10,538		44,996
Construction & development		15,038		5,507		20,545
Consumer		273		6,822		7,095
	$	73,414	$	51,368	$	124,782

Pro Forma Information of Acquisitions

The results of operations of CBG and MBT subsequent to the acquisition date are included in the Company’s consolidated statements of operations. The following unaudited pro forma information reflects the Company’s estimated consolidated results of operations as if the acquisitions had occurred on December 31, 2011 and 2010, unadjusted for potential cost savings (in thousands).

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012			2011
Net interest income and noninterest income	$	38,069	$	65,844	$	134,799		$	138,697
Net income (loss)	$	1,903	$	8,596	$	(14,905	)	$	(3,957	)
Net income (loss) available to common stockholders	$	1,076	$	7,779	$	(17,364	)	$	(6,379	)
Income (loss) per common share available to common stockholders – basic	$	0.05	$	0.33	$	(0.73	)	$	(0.27	)
Income (loss) per common share available to common stockholders – diluted	$	0.04	$	0.33	$	(0.72	)	$	(0.27	)
Average number of shares outstanding, basic		23,819		23,438		23,800			23,439
Average number of shares outstanding, diluted		23,973		23,559		23,954			23,530

Components of Covered Assets

The following table summarizes components of all covered assets at September 30, 2012 and 2011 and at December 31, 2011 and their origin:

	Covered loans		Less: Credit risk adjustments		Less: Liquidity and rate adjustments		Total covered loans		OREO		Less: Fair value adjustments		Total covered OREO		Total covered assets		FDIC indemnification asset
	(Dollars in thousands)
As of September 30, 2012:
AUB	$	28,955	$	2,532	$	—	$	26,423	$	10,342	$	—	$	10,342	$	36,765	$	3,256
USB		33,145		5,036		—		28,109		7,641		99		7,542		35,651		8,408
SCB		44,340		3,892		—		40,448		10,464		646		9,818		50,266		6,130
FBJ		33,312		6,299		43		26,970		3,407		572		2,835		29,805		6,731
DBT		186,815		47,598		331		138,886		33,404		2,798		30,606		169,492		63,789
TBC		51,084		5,790		212		45,082		10,110		1,533		8,577		53,659		15,559
HTB		95,904		18,727		56		77,121		15,219		5,766		9,453		86,574		23,698
OGB		86,091		18,719		146		67,226		7,874		3,663		4,211		71,437		21,419
CBG		139,583		43,406		208		95,969		8,518		3,007		5,511		101,480		49,450
Total	$	699,229	$	151,999	$	996	$	546,234	$	106,979	$	18,084	$	88,895	$	635,129	$	198,440

	Covered loans		Less: Credit risk adjustments		Less: Liquidity and rate adjustments		Total covered loans		OREO		Less: Fair value adjustments		Total covered OREO		Total covered assets		FDIC indemnification asset
	(Dollars in thousands)
As of December 31, 2011:
AUB	$	34,242	$	3,236	$	—	$	31,006	$	11,100	$	—	$	11,100	$	42,106	$	7,271
USB		51,409		5,259		50		46,100		7,445		50		7,395		53,495		10,648
SCB		56,780		5,779		155		50,846		10,635		500		10,135		60,981		6,527
FBJ		40,106		7,473		92		32,541		2,370		641		1,729		34,270		8,551
DBT		260,883		68,757		703		191,423		28,947		2,763		26,184		217,607		105,528
TBC		79,586		14,358		331		64,897		8,441		1,274		7,167		72,064		18,628
HTB		110,899		28,024		73		82,802		20,132		10,171		9,961		92,763		48,289
OGB		105,285		33,221		190		71,874		12,615		7,669		4,946		76,820		36,952
Total	$	739,190	$	166,107	$	1,594	$	571,489	$	101,685	$	23,068	$	78,617	$	650,106	$	242,394

	Covered loans		Less: Credit risk adjustments		Less: Liquidity and rate adjustments		Total covered loans		OREO		Less: Fair value adjustments		Total covered OREO		Total covered assets		FDIC indemnification asset
	(Dollars in thousands)
As of September 30, 2011:
AUB	$	39,217	$	3,594	$	64	$	35,559	$	13,415	$	37	$	13,378	$	48,937	$	3,215
USB		58,121		5,913		199		52,009		7,489		51		7,438		59,447		7,431
SCB		58,748		6,029		258		52,461		10,957		500		10,457		62,918		5,365
FBJ		42,499		8,239		108		34,152		3,037		1,559		1,478		35,630		8,863
DBT		313,029		112,480		827		199,722		35,672		8,774		26,898		226,620		104,739
TBC		90,044		18,995		371		70,678		6,955		1,274		5,681		76,359		19,046
HTB		129,269		47,738		73		81,458		21,953		12,618		9,335		90,793		47,604
OGB		110,188		40,609		190		69,389		19,242		12,000		7,242		76,631		43,456
Total	$	841,115	$	243,597	$	2,090	$	595,428	$	118,720	$	36,813	$	81,907	$	677,335	$	239,719

Loan-by-Loan Basis Performance of Fair Value Adjustments

The adjustments to fair value are performed on a loan-by-loan basis and have resulted in the following:

Total Amounts	September 30, 2012		December 31, 2011		September 30, 2011
	(Dollars in thousands)
Adjustments needed where the Company’s initial estimate of cash flows were underestimated: (recorded with a reclassification from non-accretable difference to accretable discount)	$	16,210	$	22,031	$	15,846
Adjustments needed where the Company’s initial estimate of cash flows were overstated: (recorded through a provision for loan losses)		11,435		11,940		8,055
Amounts reflected in the Company’s Statement of Operations	September 30, 2012		December 31, 2011		September 30, 2011
	(Dollars in thousands)
Adjustments needed where the Company’s initial estimate of cash flows were underestimated: (recorded with a reclassification from non-accretable difference to accretable discount)	$	3,242	$	4,406	$	3,169
Adjustments needed where the Company’s initial estimate of cash flows were overstated: (recorded through a provision for loan losses)		2,287		2,388		1,611

Rollforward of Acquired Loans Deterioration of Credit Quality

A rollforward of acquired loans with deterioration of credit quality for the nine months ended September 30, 2012, the year ended December 31, 2011 and the nine months ended September 30, 2011 is shown below:

(Dollars in Thousands)	September 30, 2012			December 31, 2011			September 30, 2011
Balance, January 1	$	307,790		$	252,535		$	252,535
Change in estimate of cash flows, net of charge-offs or recoveries		(7,119	)		(25,787	)		(18,815	)
Additions due to acquisitions		73,414			124,136			124,136
Other (loan payments, transfers, etc.)		(70,402	)		(43,094	)		(36,899	)
Ending balance	$	303,683		$	307,790		$	320,957

Changes In FDIC Loss Share Receivable

Changes in the FDIC shared-loss receivable for the nine months ended September 30, 2012, for the year ended December 31, 2011 and for the nine months ended September 30, 2011 are as follows:

(Dollars in Thousands)	September 30, 2012			December 31, 2011			September 30, 2011
Balance, January 1	$	242,394		$	177,187		$	177,187
Indemnification asset recorded in acquisitions		52,654			94,973			94,973
Payments received from FDIC		(97,399	)		(36,813	)		(22,107	)
Effect of change in expected cash flows on covered assets		791			7,047			(10,334	)
Ending balance	$	198,440		$	242,394		$	239,719

Loans with Deterioration of Credit Quality

Rollforward of Acquired Loans Deterioration of Credit Quality

A rollforward of acquired loans without deterioration of credit quality for the nine months ended September 30, 2012, the year ended December 31, 2011 and the nine months ended September 30, 2011 is shown below:

(Dollars in Thousands)	September 30, 2012			December 31, 2011			September 30, 2011
Balance, January 1	$	266,966		$	302,456		$	302,456
Change in estimate of cash flows, net of charge-offs or recoveries		3,861			(11,604	)		(16,886	)
Additions due to acquisitions		51,367			35,439			35,439
Other (loan payments, transfers, etc.)		(72,755	)		(59,325	)		(46,538	)
Ending balance	$	249,439		$	266,966		$	274,471

Loans without Deterioration of Credit Quality

Schedule of Changes in Accretable Discount Related Acquired Loan

The following is a summary of changes in the accretable discounts of acquired loans during the nine months ended September 30, 2012, the year ended December 31, 2011 and the nine months ended September 30, 2011.

(Dollars in Thousands)	September 30, 2012			December 31, 2011			September 30, 2011
Balance, January 1	$	29,537		$	37,383		$	37,383
Additions due to acquisitions		9,863			24,094			24,094
Accretion		(36,241	)		(36,519	)		(18,765	)
Other activity, net		16,210			4,579			(1,606	)
Ending balance	$	19,369		$	29,537		$	41,106

Montgomery Bank & Trust

Estimated Fair Value of Assets and Liabilities Assumed

The estimated fair value of the assets acquired and the liabilities assumed are shown below:

(Dollars in Thousands)	Montgomery Bank & Trust
Assets acquired:
Cash and due from banks	$	16,726
Loans		1,218
Other assets		183
Assets acquired		18,127
Cash received (paid) to settle the acquisition		138,740
Fair value of assets acquired	$	156,867
Liabilities assumed:
Deposits	$	156,699
Other liabilities		168
Fair value of liabilities assumed	$	156,867
Net assets acquired / gain from acquisition	$	—

Central Bank of Georgia (CBG)

Estimated Fair Value of Assets and Liabilities Assumed

The estimated fair value of the assets acquired and the liabilities assumed are shown below:

(Dollars in Thousands)	Central Bank of Georgia
Assets acquired:
Cash and due from banks	$	33,150
Securities available for sale		39,920
Loans		124,782
Foreclosed property		6,177
Estimated FDIC indemnification asset		52,654
Other assets		4,606
Assets acquired		261,289
Cash received (paid) to settle the acquisition		31,900
Fair value of assets acquired	$	293,189
Liabilities assumed:
Deposits	$	261,036
Other borrowings		10,334
Other liabilities		1,782
Fair value of liabilities assumed	$	273,152
Net assets acquired / gain from acquisition	$	20,037