e8vk

Exhibit No.

Description

Earnings Release dated October 16, 2007.

Supplemental financial information for the quarter ended September 30, 2007.

0000893220-07-003383.txt : 20071017 0000893220-07-003383.hdr.sgml : 20071017 20071017114616 ACCESSION NUMBER: 0000893220-07-003383 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20071016 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20071017 DATE AS OF CHANGE: 20071017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FULTON FINANCIAL CORP CENTRAL INDEX KEY: 0000700564 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 232195389 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-10587 FILM NUMBER: 071175760 BUSINESS ADDRESS: STREET 1: ONE PENN SQ STREET 2: PO BOX 4887 CITY: LANCASTER STATE: PA ZIP: 17604 BUSINESS PHONE: 7172912411 MAIL ADDRESS: STREET 1: ONE PENN SQ STREET 2: PO BOX 4887 CITY: LANCASTER STATE: PA ZIP: 17604 8-K 1 w41005e8vk.htm FORM 8-K FULTON FINANCIAL CORPORATION e8vk

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:		October 17, 2007

(Date of earliest event reported):		October 16, 2007

Commission File No. 0-10587

FULTON FINANCIAL CORPORATION

(Exact name of Registrant as specified in its Charter)


Pennsylvania (State or other jurisdiction of incorporation)		23-2195389 (IRS Employer Identification Number)


One Penn Square Lancaster, Pennsylvania (Address of principal executive offices)		17602 (Zip Code)

Registrant’s telephone number, including area code: 717-291-2411

Former name or former address, if changed since last Report: N/A

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

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

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

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

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

Item 2.02 — Results of Operations and Financial Condition

On October 16, 2007 Fulton Financial Corporation announced its results of operations for the third quarter ended September 30, 2007. A copy of the earnings release is attached as Exhibit 99.1 to this Form 8-K. Supplemental financial information included with the earnings release is attached as Exhibit 99.2 to this report.

Item 9.01 Financial Statements And Exhibits

(d)

Exhibits.

SIGNATURE

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.


Date: October 17, 2007	FULTON FINANCIAL CORPORATION
	By:	/s/ Charles J. Nugent
		Charles J. Nugent
		Senior Executive Vice President and Chief Financial Officer

EX-99.1 2 w41005exv99w1.htm EARNINGS RELEASE exv99w1

Exhibit 99.1


FOR IMMEDIATE RELEASE		Media Contact : Laura J. Wakeley
		717-291-2616

Fulton Financial reports third quarter earnings

(October 16) — Lancaster, PA — Fulton Financial Corporation (Nasdaq: FULT) earned $33.6 million for the third quarter ended September 30, 2007, a 30.6 percent decrease from the same period in 2006. Diluted net income per share for the quarter decreased to 19 cents, a 32.1 percent decrease from the 28 cents reported in 2006. Diluted net income per share for the quarter decreased 17.4 percent from the 23 cents reported in the second quarter of 2007.

Net income was $114.5 million for the nine months ended September 30, 2007, a 17.6 percent decrease from the same period in 2006. Diluted net income per share for the first nine months of 2007 decreased to 66 cents, a 17.5 percent decrease from the 80 cents reported in 2006. Total assets at September 30, 2007 were approximately $15.4 billion.

During the third quarter, the Corporation recorded a $16.0 million charge related to mortgage banking operations at Resource Bank. The Corporation also recorded a gain of approximately $2.1 million ($1.8 million, net of related expenses) related to the resolution of litigation with another bank and the sale of certain assets, each related to the mortgage banking operations of Resource Bank. The $16.0 million charge included $9.9 million related to two specific situations where potential misrepresentation of borrower information exists, $3.6 million related to revaluations of repurchased loans and foreclosed real estate and $2.2 million related to outstanding repurchase requests. The majority of the loss is attributable to Resource Mortgage wholesale branch offices that have been closed or sold. Fulton Mortgage Company now oversees the operations of Resource Mortgage.

“We continue to deal with the impact of a slow-down in the housing market along with the Resource Mortgage issues,” said R. Scott Smith Jr., Chairman, Chief Executive Officer and President. “Management’s attention is focused on resolving those issues and, based on our analysis, we believe the resulting reserves are adequate for these situations. Out of an

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Page 2 . . . Fulton Financial reports third quarter earnings

abundance of caution, we are conducting a review of the records related to mortgages originated by Resource Mortgage. Based on market factors and the results of the review, it is possible that additional reserves may be required in the future.”

“External factors impacting our earnings are the economy and the direction of interest rates,” continued Smith. “Commercial loan growth was good. However, funding this growth with lower cost deposits remains a challenge as was evident in the reduction of our net interest margin. As anticipated, we are seeing tangible results from our expense reduction initiatives.”

Loans, net of unearned income, increased $676.3 million, or 6.6 percent, to $11.0 billion at September 30, 2007, compared to $10.3 billion at September 30, 2006. The increase was primarily realized in commercial loans, which grew $382.8 million, or 13.0 percent, and commercial mortgages, which increased $233.1 million, or 7.3 percent. In comparison to the second quarter of 2007, loans, net of unearned income, increased $274.5 million, or 2.6 percent, which was mainly due to growth in commercial loans of $95.4 million, or 3.0 percent, an increase in commercial mortgages of $76.0 million, or 2.3 percent, and residential mortgages, which increased $77.2 million, or 10.5 percent.

Non-performing assets were $107.0 million, or 0.69 percent of total assets, at September 30, 2007, compared to $46.8 million, or 0.31 percent, at September 30, 2006 and $74.1 million, or 0.49 percent, at June 30, 2007. The $32.9 million, or 44.3 percent, increase in non-performing assets since June 30, 2007 was primarily due to the repurchase of residential mortgages from investors during the third quarter. As of September 30, 2007, the remaining outstanding balances of these repurchased loans classified as non-accrual loans and other real estate owned were approximately $21 million.

Annualized net charge-offs for the quarter ended September 30, 2007 were 0.08 percent of average total loans, compared to annualized net recoveries of 0.01 percent for the quarter ended September 30, 2006 and annualized net charge-offs of 0.14 percent for the quarter ended June 30, 2007. For the nine months ended September 30, 2007, annualized net charge-offs were 0.07 percent of average total loans, compared to 0.01 percent for the same period in 2006. The provision for loan losses increased $4.1 million for the third quarter of 2007, as compared to the same period in 2006.

Total deposits at September 30, 2007 of $10.3 billion were relatively unchanged from September 30, 2006. Time deposits increased $279.4 million, or 6.4 percent, offset by a $265.3 million, or 4.5 percent, decrease in demand and savings deposits. In comparison to the second quarter of 2007, total deposits decreased $27.1 million, or 0.3 percent, due to a $147.7 million, or

Page 3 . . . Fulton Financial reports third quarter earnings

2.6 percent, decrease in demand and savings deposits, offset by a $120.7 million, or 2.7 percent, increase in time deposits.

Net interest income for the third quarter decreased $3.5 million, or 2.8 percent, compared to the third quarter of 2006 and increased $1.5 million, or 1.2 percent, from the second quarter of 2007. Fulton Financial’s net interest margin was 3.62 percent for the third quarter of 2007, 3.85 percent for the third quarter of 2006 and 3.70 percent for second quarter of 2007. During the third quarter of 2006, $3.3 million of interest recoveries on loans added 10 basis points to net interest margin.

Other income, excluding investment securities losses and gains, increased $1.4 million, or 4.0 percent, in the third quarter of 2007 compared to the same period in 2006. The increase resulted primarily from a $1.8 million increase in other service charges and fees and the $2.1 million gain from the sale of certain mortgage-related assets and the settlement of related lawsuits during the third quarter of 2007. These increases were offset by a decline in gains on sales of mortgage loans. Compared to the second quarter of 2007, other income, excluding security gains and losses, increased $501,000, or 1.4 percent, primarily due to the previously mentioned gain and lawsuit settlement, offset by decreases in gains on sales of mortgage loans and in investment management and trust services.

Other expenses increased $15.6 million, or 16.8 percent, compared to the third quarter of 2006, to $108.0 million. The increase was due to the additional $16.0 million of contingent losses related to the Corporation’s mortgage banking activities at Resource Bank, offset by a $2.5 million reduction in salaries and employee benefits, due in part to corporate-wide workforce management and centralization initiatives which began during 2007. Compared to the second quarter of 2007, other expenses increased $9.9 million, or 10.1 percent.

Fulton Financial Corporation is a Lancaster, Pennsylvania-based financial holding company which operates more than 260 banking offices in Pennsylvania, Maryland, Delaware, New Jersey and Virginia through the following affiliates: Fulton Bank, Lancaster, PA; Swineford National Bank, Middleburg, PA; Lafayette Ambassador Bank, Easton, PA; FNB Bank, N.A., Danville, PA; Hagerstown Trust, Hagerstown, MD; Delaware National Bank, Georgetown, DE; The Bank, Woodbury, NJ; The Peoples Bank of Elkton, Elkton, MD; Skylands Community Bank, Hackettstown, NJ; Resource Bank, Virginia Beach, VA and The Columbia Bank, Columbia, MD.

The Corporation’s financial services affiliates include Fulton Financial Advisors, N.A., Lancaster, PA; Fulton Insurance Services Group, Inc., Lancaster, PA; and Dearden, Maguire, Weaver and Barrett, LLC, West Conshohocken, PA.

Residential mortgage lending is offered by all banks through Fulton Mortgage Company or Resource Mortgage.

Page 4 . . . Fulton Financial reports third quarter earnings

Additional information on Fulton Financial Corporation is available on the Internet at www.fult.com.

Safe Harbor Statement:

This news release may contain forward-looking statements with respect to our financial condition, results of operations and business. Forward-looking statements are encouraged by the Private Securities Litigation Reform Act of 1995. When words such as “believes”, “expects”, “anticipates” or similar expressions are used in this release, the Corporation is making forward-looking statements.

Such forward-looking statements reflect the Corporation’s current views and expectations based largely on information currently available to its management, and on its current expectations, assumptions, plan, estimates, judgments, and projections about its business and its industry, and they involve inherent risks, contingencies, uncertainties and other factors. Although the Corporation believes that these forward-looking statements are based on reasonable estimates and assumptions, the Corporation is unable to provide any assurance that its expectations will, in fact, occur or that its estimates or assumptions will be correct and actual results could differ materially from those expressed or implied by such forward-looking statements and such statements are not guarantees of future performance. The Corporation undertakes no obligation to update or revise any forward-looking statements. Accordingly, investors and others are cautioned not to place undue reliance on such forward-looking statements.

Many factors could affect future financial results including, without limitation, acquisition and growth strategies, market risk, the effect of competition and interest rates on net interest margin and net interest income, investment strategy and income growth, investment securities gains, other-than-temporary impairment of investment securities, deposit and loan growth, asset quality, balances of risk-sensitive assets to risk-sensitive liabilities, employee benefits and other expenses, amortization of intangible assets, goodwill impairment, capital and liquidity strategies and other financial and business matters for future periods.

For a more complete discussion of certain risks and uncertainties affecting the Corporation, please see the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Forward-Looking Statements” set forth in the Corporation’s filings with the Securities and Exchange Commission.

Page 5 . . . Fulton Financial reports third quarter earnings

# # #

2007

EX-99.2 3 w41005exv99w2.htm SUPPLEMENTAL FINANCIAL INFORMATION FOR THE QUARTER ENDED SEPTEMBER 30, 2007 exv99w2

Exhibit 99.2

FULTON FINANCIAL CORPORATION
FINANCIAL HIGHLIGHTS (UNAUDITED)
dollars in thousands, except per-share data


	September 30
BALANCE SHEET DATA	2007		2006		% Change
Total assets	$	15,438,177	$	14,910,652		3.5	%
Loans, net of unearned income		10,988,307		10,312,057		6.6	%
Investment securities		2,948,262		2,950,671		(0.1	%)
Deposits		10,291,186		10,277,028		0.1	%
Shareholders’ equity		1,554,120		1,497,693		3.8	%


										Nine Months Ended
	Quarter Ended September 30									September 30
INCOME SUMMARY	2007			2006			% Change			2007			2006			% Change
Interest income	$	238,740		$	229,101			4.2	%	$	699,508		$	634,959			10.2	%
Interest expense		(116,330	)		(103,177	)		12.7	%		(334,415	)		(271,141	)		23.3	%

Net interest income		122,410			125,924			(2.8	%)		365,093			363,818			0.4	%
Provision for loan losses		(4,606	)		(555	)		729.9	%		(8,263	)		(2,430	)		240.0	%
Investment securities (losses) gains		(134	)		1,450			(109.2	%)		2,277			5,524			(58.8	%)
Other income		36,877			35,462			4.0	%		110,536			103,997			6.3	%
Other expenses		(107,996	)		(92,425	)		16.8	%		(307,008	)		(271,234	)		13.2	%

Income before income taxes		46,551			69,856			(33.4	%)		162,635			199,675			(18.6	%)
Income taxes		(12,985	)		(21,514	)		(39.6	%)		(48,096	)		(60,753	)		(20.8	%)

Net income	$	33,566		$	48,342			(30.6	%)	$	114,539		$	138,922			(17.6	%)


PER-SHARE DATA:

Net income:
Basic	$	0.19		$	0.28			(32.1	%)	$	0.66		$	0.80			(17.5	%)
Diluted		0.19			0.28			(32.1	%)		0.66			0.80			(17.5	%)
Cash dividends		0.1500			0.1475			1.7	%		0.448			0.433			3.5	%

Shareholders’ equity		8.96			8.63			3.8	%
Shareholders’ equity (tangible)		5.17			4.82			7.3	%

SELECTED FINANCIAL RATIOS:

Return on average assets		0.88	%		1.31	%					1.03	%		1.32	%
Return on average shareholders’ equity		8.67	%		13.26	%					10.07	%		13.04	%
Return on average shareholders’ equity (tangible)		15.76	%		25.14	%					18.42	%		24.34	%
Net interest margin		3.62	%		3.85	%					3.69	%		3.88	%
Efficiency ratio		65.17	%		55.04	%					61.97	%		55.72	%
Non-performing assets to total assets		0.69	%		0.31	%

FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED ENDING BALANCE SHEETS (UNAUDITED)
dollars in thousands


										% Change from
	September 30			September 30			June 30			September 30			June 30
	2007			2006			2007			2006			2007
ASSETS
Cash and due from banks	$	337,306		$	338,598		$	381,714			(0.4	%)		(11.6	%)
Loans held for sale		116,451			236,787			185,471			(50.8	%)		(37.2	%)
Other interest-earning assets		19,673			35,884			14,367			(45.2	%)		36.9	%
Investment securities		2,948,262			2,950,671			2,750,394			(0.1	%)		7.2	%
Loans, net of unearned		10,988,307			10,312,057			10,713,819			6.6	%		2.6	%
Allowance for loan losses		(109,435	)		(107,422	)		(106,892	)		1.9	%		2.4	%

Net Loans		10,878,872			10,204,635			10,606,927			6.6	%		2.6	%
Premises and equipment		190,092			188,403			188,893			0.9	%		0.6	%
Accrued interest receivable		73,927			70,901			71,785			4.3	%		3.0	%
Goodwill and intangible assets		658,274			661,594			659,739			(0.5	%)		(0.2	%)
Other assets		215,320			223,179			219,125			(3.5	%)		(1.7	%)

Total Assets	$	15,438,177		$	14,910,652		$	15,078,415			3.5	%		2.4	%


LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits	$	10,291,186		$	10,277,028		$	10,318,239			0.1	%		(0.3	%)
Short-term borrowings		1,773,083			1,833,644			1,496,407			(3.3	%)		18.5	%
Long-term debt		1,632,980			1,109,220			1,555,351			47.2	%		5.0	%
Other liabilities		186,808			193,067			176,758			(3.2	%)		5.7	%

Total Liabilities		13,884,057			13,412,959			13,546,755			3.5	%		2.5	%
Shareholders’ equity		1,554,120			1,497,693			1,531,660			3.8	%		1.5	%

Total Liabilities and Shareholders’ Equity	$	15,438,177		$	14,910,652		$	15,078,415			3.5	%		2.4	%


LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:
Loans, by type:
Commercial — industrial and financial	$	2,954,204		$	2,600,807		$	2,864,939			13.6	%		3.1	%
Commercial — agricultural		374,759			345,332			368,591			8.5	%		1.7	%
Real estate — commercial mortgage		3,407,715			3,174,623			3,331,676			7.3	%		2.3	%
Real estate — residential mortgage		809,148			677,994			731,966			19.3	%		10.5	%
Real estate — home equity		1,472,376			1,465,373			1,447,058			0.5	%		1.7	%
Real estate — construction		1,389,164			1,431,535			1,379,449			(3.0	%)		0.7	%
Consumer		500,021			529,741			505,365			(5.6	%)		(1.1	%)
Leasing and other		80,920			86,652			84,775			(6.6	%)		(4.5	%)

Total Loans, net of unearned income	$	10,988,307		$	10,312,057		$	10,713,819			6.6	%		2.6	%


Deposits, by type:
Noninterest-bearing demand	$	1,696,871		$	1,886,514		$	1,818,862			(10.1	%)		(6.7	%)
Interest-bearing demand		1,738,605			1,658,545			1,667,455			4.8	%		4.3	%
Savings deposits		2,195,363			2,351,041			2,292,257			(6.6	%)		(4.2	%)
Time deposits		4,660,347			4,380,928			4,539,665			6.4	%		2.7	%

Total Deposits	$	10,291,186		$	10,277,028		$	10,318,239			0.1	%		(0.3	%)


Short-term borrowings, by type:
Customer repurchase agreements	$	248,915		$	363,561		$	261,568			(31.5	%)		(4.8	%)
Federal funds purchased		842,476			1,183,447			830,327			(28.8	%)		1.5	%
Short-term promissory notes		476,249			236,701			399,317			101.2	%		19.3	%
Other		205,443			49,935			5,195			311.4	%		N/M

Total Short-term borrowings	$	1,773,083		$	1,833,644		$	1,496,407			(3.3	%)		18.5	%

N/M — Not Meaningful

FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED INCOME STATEMENTS (UNAUDITED)
dollars in thousands, except per-share data


	Quarter Ended									% Change from						Nine Months Ended
	September 30			September 30			June 30			September 30			June 30			September 30
	2007			2006			2007			2006			2007			2007			2006			% Change
Interest Income:
Interest Income	$	238,740		$	229,101		$	230,112			4.2	%		3.7	%	$	699,508		$	634,959			10.2	%
Interest Expense		116,330			103,177			109,204			12.7	%		6.5	%		334,415			271,141			23.3	%

Net Interest Income		122,410			125,924			120,908			(2.8	%)		1.2	%		365,093			363,818			0.4	%
Provision for Loan Losses		4,606			555			2,700			729.9	%		70.6	%		8,263			2,430			240.0	%

Net Interest Income after Provision		117,804			125,369			118,208			(6.0	%)		(0.3	%)		356,830			361,388			(1.3	%)

Other Income:
Investment management and trust services		9,291			8,887			10,273			4.5	%		(9.6	%)		29,374			27,975			5.0	%
Service charges on deposit accounts		11,293			11,345			11,225			(0.5	%)		0.6	%		33,145			32,484			2.0	%
Other service charges and fees		8,530			6,693			7,841			27.4	%		8.8	%		23,746			19,923			19.2	%
Gains on sale of mortgage loans		2,532			5,480			4,188			(53.8	%)		(39.5	%)		12,113			15,439			(21.5	%)
Investment securities (losses) gains		(134	)		1,450			629			(109.2	%)		(121.3	%)		2,277			5,524			(58.8	%)
Other		5,231			3,057			2,849			71.1	%		83.6	%		12,158			8,176			48.7	%

Total Other Income		36,743			36,912			37,005			(0.5	%)		(0.7	%)		112,813			109,521			3.0	%

Other Expenses:
Salaries and employee benefits		52,505			55,048			55,555			(4.6	%)		(5.5	%)		164,353			158,367			3.8	%
Net occupancy expense		9,813			9,260			9,954			6.0	%		(1.4	%)		29,963			26,856			11.6	%
Equipment expense		3,438			3,703			3,436			(7.2	%)		0.1	%		10,589			10,791			(1.9	%)
Data processing		3,131			3,057			3,217			2.4	%		(2.7	%)		9,550			9,131			4.6	%
Advertising		2,470			2,934			2,990			(15.8	%)		(17.4	%)		7,869			8,214			(4.2	%)
Intangible amortization		1,995			2,025			2,198			(1.5	%)		(9.2	%)		6,176			5,883			5.0	%
Other		34,644			16,398			20,757			111.3	%		66.9	%		78,508			51,992			51.0	%

Total Other Expenses		107,996			92,425			98,107			16.8	%		10.1	%		307,008			271,234			13.2	%

Income Before Income Taxes		46,551			69,856			57,106			(33.4	%)		(18.5	%)		162,635			199,675			(18.6	%)
Income Taxes		12,985			21,514			17,261			(39.6	%)		(24.8	%)		48,096			60,753			(20.8	%)

Net Income	$	33,566		$	48,342		$	39,845			(30.6	%)		(15.8	%)	$	114,539		$	138,922			(17.6	%)


SHARE AND PER-SHARE INFORMATION:
Net income:
Basic	$	0.19		$	0.28		$	0.23			(32.1	%)		(17.4	%)	$	0.66		$	0.80			(17.5	%)
Diluted		0.19			0.28			0.23			(32.1	%)		(17.4	%)		0.66			0.80			(17.5	%)

Cash dividends	$	0.1500		$	0.1475		$	0.1500			1.7	%		—		$	0.448		$	0.433			3.5	%
Shareholders’ equity		8.96			8.63			8.84			3.8	%		1.4	%
Shareholders’ equity (tangible)		5.17			4.82			5.03			7.3	%		2.8	%

Weighted average shares (basic)		173,304			173,439			173,184			(0.1	%)		0.1	%		173,254			172,595			0.4	%
Weighted average shares (diluted)		174,370			175,390			174,417			(0.6	%)		—			174,493			174,689			(0.1	%)
Shares outstanding, end of period		173,394			173,493			173,270			(0.1	%)		0.1	%

SELECTED FINANCIAL RATIOS:
Return on average assets		0.88	%		1.31	%		1.08	%								1.03	%		1.32	%
Return on average shareholders’ equity		8.67	%		13.26	%		10.52	%								10.07	%		13.04	%
Return on average shareholders’ equity (tangible)		15.76	%		25.14	%		19.30	%								18.42	%		24.34	%
Net interest margin		3.62	%		3.85	%		3.70	%								3.69	%		3.88	%
Efficiency ratio		65.17	%		55.04	%		59.72	%								61.97	%		55.72	%

FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands


	Quarter Ended
	September 30, 2007									September 30, 2006									June 30, 2007
	Balance			Interest (1)			Rate (1)			Balance			Interest (1)			Rate (1)			Balance			Interest (1)			Rate (1)
ASSETS
Interest-earning assets:
Loans and leases	$	10,857,636		$	205,747			7.52	%	$	10,167,362		$	194,379			7.59	%	$	10,582,300		$	199,085			7.54	%
Taxable investment securities		2,116,123			24,583			4.65	%		2,309,644			25,323			4.39	%		1,973,214			21,999			4.46	%
Tax-exempt investment securities		499,389			6,377			5.11	%		449,181			5,496			4.89	%		500,341			6,405			5.12	%
Equity securities		188,490			2,269			4.80	%		155,894			1,833			4.69	%		188,558			2,230			4.74	%

Total Investment Securities		2,804,002			33,229			4.74	%		2,914,719			32,652			4.48	%		2,662,113			30,634			4.60	%
Loans held for sale		159,492			2,694			6.76	%		227,038			4,224			7.44	%		197,852			3,393			6.86	%
Other interest-earning assets		34,536			432			4.91	%		54,424			695			5.03	%		25,311			311			4.90	%

Total Interest-earning Assets		13,855,666			242,102			6.95	%		13,363,543			231,950			6.90	%		13,467,576			233,423			6.95	%

Noninterest-earning assets:
Cash and due from banks		338,862									329,482									340,752
Premises and equipment		190,175									187,876									189,975
Other assets		890,901									859,800									899,160
Less: allowance for loan losses		(108,628	)								(107,090	)								(108,952	)

Total Assets	$	15,166,976								$	14,633,611								$	14,788,511


LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing liabilities:
Demand deposits	$	1,729,357		$	7,630			1.75	%	$	1,689,386		$	6,529			1.53	%	$	1,676,528		$	7,198			1.72	%
Savings deposits		2,259,231			13,680			2.40	%		2,370,275			14,258			2.37	%		2,298,910			13,776			2.40	%
Time deposits		4,626,160			55,093			4.72	%		4,294,731			46,254			4.27	%		4,526,107			52,825			4.68	%

Total Interest-bearing Deposits		8,614,748			76,403			3.52	%		8,354,392			67,041			3.18	%		8,501,545			73,799			3.48	%

Short-term borrowings		1,477,288			17,786			4.74	%		1,730,970			21,697			4.92	%		1,243,370			14,894			4.77	%
Long-term debt		1,655,599			22,141			5.32	%		1,093,815			14,439			5.24	%		1,585,125			20,511			5.19	%

Total Interest-bearing Liabilities		11,747,635			116,330			3.93	%		11,179,177			103,177			3.65	%		11,330,040			109,204			3.86	%

Noninterest-bearing liabilities:
Demand deposits		1,703,137									1,826,800									1,756,271
Other		179,391									181,322									183,449

Total Liabilities		13,630,163									13,187,299									13,269,760

Shareholders’ equity		1,536,813									1,446,312									1,518,751

Total Liabilities and Shareholders’ Equity	$	15,166,976								$	14,633,611								$	14,788,511


Net interest income/net interest margin (fully taxable equivalent)					125,772			3.62	%					128,773			3.85	%					124,219			3.70	%

Tax equivalent adjustment					(3,362	)								(2,849	)								(3,311	)

Net interest income				$	122,410								$	125,924								$	120,908


(1)		Presented on a tax-equivalent basis using a 35% Federal tax rate and statutory interest expense disallowances.

AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:


	Quarter Ended						% Change from
	September 30		September 30		June 30		September 30			June 30
	2007		2006		2007		2006			2007
Loans, by type:
Commercial — industrial and financial	$	2,908,049	$	2,587,869	$	2,805,554		12.4	%		3.7	%
Commercial — agricultural		373,293		337,660		366,679		10.6	%		1.8	%
Real estate — commercial mortgage		3,383,487		3,113,086		3,287,308		8.7	%		2.9	%
Real estate — residential mortgage		769,381		658,537		710,433		16.8	%		8.3	%
Real estate — home equity		1,454,947		1,450,255		1,435,467		0.3	%		1.4	%
Real estate — construction		1,382,951		1,412,678		1,381,552		(2.1	%)		0.1	%
Consumer		502,482		527,915		506,965		(4.8	%)		(0.9	%)
Leasing and other		83,046		79,362		88,342		4.6	%		(6.0	%)


Total Loans, net of unearned income	$	10,857,636	$	10,167,362	$	10,582,300		6.8	%		2.6	%


Deposits, by type:
Noninterest-bearing demand	$	1,703,137	$	1,826,800	$	1,756,271		(6.8	%)		(3.0	%)
Interest-bearing demand		1,729,357		1,689,386		1,676,528		2.4	%		3.2	%
Savings deposits		2,259,231		2,370,275		2,298,910		(4.7	%)		(1.7	%)
Time deposits		4,626,160		4,294,731		4,526,107		7.7	%		2.2	%


Total Deposits	$	10,317,885	$	10,181,192	$	10,257,816		1.3	%		0.6	%


Short-term borrowings, by type:
Customer repurchase agreements	$	242,375	$	334,759	$	255,685		(27.6	%)		(5.2	%)
Federal funds purchased		756,360		1,143,445		586,007		(33.9	%)		29.1	%
Short-term promissory notes		446,182		201,282		376,149		121.7	%		18.6	%
Other		32,371		51,484		25,529		(37.1	%)		26.8	%


Total Short-term borrowings	$	1,477,288	$	1,730,970	$	1,243,370		(14.7	%)		18.8	%

FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands


	Nine Months Ended September 30
	2007									2006
	Balance			Interest (1)			Rate (1)			Balance			Interest (1)			Rate (1)
ASSETS
Interest-earning assets:
Loans and leases	$	10,619,834		$	601,390			7.57	%	$	9,750,452		$	537,281			7.37	%
Taxable investment securities		2,092,916			71,201			4.54	%		2,246,672			71,426			4.24	%
Tax-exempt investment securities		497,504			19,010			5.09	%		438,510			15,881			4.83	%
Equity securities		185,215			6,628			4.78	%		151,078			5,132			4.53	%

Total Investment Securities		2,775,635			96,839			4.65	%		2,836,260			92,439			4.35	%

Loans held for sale		188,223			9,771			6.92	%		216,295			11,688			7.21	%
Other interest-earning assets		36,008			1,339			4.93	%		56,045			1,950			4.63	%

Total Interest-earning Assets		13,619,700			709,339			6.96	%		12,859,052			643,358			6.69	%

Noninterest-earning assets:
Cash and due from banks		331,945									340,885
Premises and equipment		190,711									183,112
Other assets		896,604									836,754
Less: allowance for loan losses		(108,425	)								(105,291	)

Total Assets	$	14,930,535								$	14,114,512


LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing liabilities:
Demand deposits	$	1,688,129		$	21,733			1.72	%	$	1,676,087		$	18,112			1.44	%
Savings deposits		2,284,521			41,266			2.41	%		2,340,708			37,181			2.12	%
Time deposits		4,537,160			158,411			4.67	%		4,042,569			120,934			4.00	%

Total Interest-bearing Deposits		8,509,810			221,410			3.48	%		8,059,364			176,227			2.92	%
Short-term borrowings		1,424,109			51,734			4.82	%		1,607,946			55,430			4.56	%
Long-term debt		1,564,333			61,271			5.23	%		1,033,706			39,484			5.11	%

Total Interest-bearing Liabilities		11,498,252			334,415			3.88	%		10,701,016			271,141			3.38	%

Noninterest-bearing liabilities:
Demand deposits		1,726,782									1,817,547
Other		184,010									171,391

Total Liabilities		13,409,044									12,689,954

Shareholders’ equity		1,521,491									1,424,558

Total Liabilities and Shareholders’ Equity	$	14,930,535								$	14,114,512


Net interest income/net interest margin (fully taxable equivalent)					374,924			3.69	%					372,217			3.88	%

Tax equivalent adjustment					(9,831	)								(8,399	)

Net interest income				$	365,093								$	363,818


(1)		Presented on a tax-equivalent basis using a 35% Federal tax rate and statutory interest expense disallowances.

AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:


	Nine Months Ended
	September 30
	2007		2006		% Change
Loans, by type:
Commercial — industrial and financial	$	2,795,619	$	2,445,367		14.3	%
Commercial — agricultural		366,905		330,368		11.1	%
Real estate — commercial mortgage		3,303,854		3,033,010		8.9	%
Real estate — residential mortgage		727,491		624,546		16.5	%
Real estate — home equity		1,444,100		1,401,875		3.0	%
Real estate — construction		1,386,960		1,317,274		5.3	%
Consumer		508,544		522,381		(2.6	%)
Leasing and other		86,361		75,631		14.2	%


Total Loans, net of unearned income	$	10,619,834	$	9,750,452		8.9	%

Deposits, by type:
Noninterest-bearing demand	$	1,726,782	$	1,817,547		(5.0	%)
Interest-bearing demand		1,688,129		1,676,087		0.7	%
Savings deposits		2,284,521		2,340,708		(2.4	%)
Time deposits		4,537,160		4,042,569		12.2	%


Total Deposits	$	10,236,592	$	9,876,911		3.6	%

Short-term borrowings, by type:
Customer repurchase agreements	$	251,520	$	358,079		(29.8	%)
Federal funds purchased		751,954		1,084,901		(30.7	%)
Short-term promissory notes		379,761		126,917		199.2	%
Other		40,874		38,049		7.4	%


Total Short-term borrowings	$	1,424,109	$	1,607,946		(11.4	%)

FULTON FINANCIAL CORPORATION
ASSET QUALITY INFORMATION (UNAUDITED)
dollars in thousands


										Nine Months Ended
	Quarter Ended									September 30
	September 30			September 30			June 30
	2007			2006			2007			2007			2006
ALLOWANCE FOR LOAN LOSSES:
Balance at beginning of period	$	106,892		$	106,544		$	107,899		$	106,884		$	92,847

Loans charged off		(2,805	)		(1,068	)		(4,506	)		(8,671	)		(4,247	)
Recoveries of loans previously charged off		742			1,391			799			2,959			3,401

Net loans (charged off) recovered		(2,063	)		323			(3,707	)		(5,712	)		(846	)
Provision for loan losses		4,606			555			2,700			8,263			2,430
Allowance purchased		—			—			—			—			12,991

Balance at end of period	$	109,435		$	107,422		$	106,892		$	109,435		$	107,422


Net charge-offs (recoveries) to average loans (annualized)		0.08	%		(0.01	%)		0.14	%		0.07	%		0.01	%


NON-PERFORMING ASSETS:
Non-accrual loans	$	71,056		$	26,591		$	46,683
Accruing loans 90+ days overdue		23,406			16,704			21,559
Other real estate owned		12,536			3,489			5,899

Total non-performing assets	$	106,998		$	46,784		$	74,141


ASSET QUALITY RATIOS:
Non-accrual loans to total loans		0.65	%		0.26	%		0.44	%
Non-performing assets to total loans and OREO		0.97	%		0.45	%		0.69	%
Non-performing assets to total assets		0.69	%		0.31	%		0.49	%
Allowance for loan losses to loans outstanding		1.00	%		1.04	%		1.00	%
Allowance/non-performing loans		116	%		248	%		157	%

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