8-K

8-K – page # of 3

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC  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)  February 17, 2005

    SEACOAST BANKING CORPORATION OF FLORIDA

(Exact Name of Registrant as Specified in Charter)

Florida	1-13660	59-2260678
(State or Other Jurisdiction of Incorporation)	(Commission File Number	(IRS Employer Identification No.)

815 Colorado Avenue, Stuart, FL	34994
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code     (772) 287-4000    

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.)

¨

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

¨

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

¨

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

¨

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

8-K – page # of 3

SEACOAST BANKING CORPORATION OF FLORIDA

Item 2.02

Results of Operations and Financial Condition

On February 14, 2005, the Registrant announced its financial results for the fourth quarter and year ended December 31, 2004.  A copy of the press release announcing the Registrant’s results for the fourth quarter and year ended December 31, 2004 is attached hereto as Exhibit 99.1 and incorporated herein by reference.

Item 7.01

Regulation FD Disclosure

On February 15, 2005, the Registrant held an investor conference call to discuss its financial results for the fourth quarter and year ended December 31, 2004.  A transcript of this conference call is attached hereto as Exhibit 99.2 and incorporated herein by reference.  Also attached as Exhibit 99.3 are charts (available on the Registrant’s website) referenced in the conference call and incorporated herein by reference.  All information included in the transcript and the charts is presented as of December 31, 2004, and the Registrant does not assume any obligation to correct or update said information in the future.

The information in the preceding paragraph, as well as Exhibits 99.2 and 99.3 referenced therein, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in filing under the Securities Act of 1933.

Item 9.01

Financial Statements and Exhibits

(c) The following exhibits are filed herewith:

Exhibit Number	Description
99.1	Press Release dated February 14, 2005 with respect to Seacoast Banking Corporation of Florida’s financial results for the fourth quarter and year ended December 31, 2004.
99.2	Transcript of Registrant’s investor conference call held on February 15, 2005 to discuss the Registrant’s financial results for the fourth quarter and year ended December 31, 2004.
99.3	Data of charts referenced in the conference call held on February 15, 2005 to discuss the Registrant’s financial results for the fourth quarter and year ended December 31, 2004.

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.

SEACOAST BANKING CORPORATION OF FLORIDA

(Registrant)

Dated:   

February 17, 2005

By:    /s/ William R. Hahl

Name:  William R. Hahl

Title:  EVP & CFO

EX-1

EXHIBIT 99.1

NEWS RELEASE

Dennis S. Hudson, III

President and Chief Executive Officer

Seacoast Banking Corporation of Florida

(772) 288-6086

William R. Hahl

Executive Vice President/

Chief Financial Officer

 (772) 221-2825

SEACOAST REPORTS 2004 EARNINGS

STUART, FL., February 14, 2005 – Seacoast Banking Corporation of Florida (NASDAQ-NMS:  SBCF), a bank holding company whose principal subsidiary is First National Bank and Trust Company of the Treasure Coast, today reported that net income for the year 2004 totaled $14.9 million, or $0.95 diluted earnings per share ("DEPS"), compared to $14.0 million or $0.89 DEPS earned in 2003, an increase of 6.7 percent.   Earnings for the fourth quarter of 2004 totaled $3,700,000 or $0.24 DEPS.

The Company also announced that an interest rate swap transaction entered into in January of 2003 should not be accounted for as a fair value hedge under the Financial Accounting Standards Board (“FASB”) Statement No. 133, “Accounting for Derivative Instruments and Hedging Activities”, but instead should be accounted for as an interest rate swap with the change in fair value of the swap recorded in current earnings.  The impact of this accounting change decreased earnings by $0.03 DEPS for the year 2004.  The change is not material to annual earnings results for the year 2003.  The Company expects to restate previously reported earnings information for certain prior quarters, as appropriate.  The restatement will not affect prior period operating earnings (earnings excluding the impact of the swap) or capital adequacy.  The sw ap transaction was executed to hedge the fair value of $54 million in fixed rate certificates of deposit issued prior to January of 2003 at market rates.  The transaction reduced the Company’s exposure to declines in interest rates that occurred in 2003, was effective in economic terms, and performed consistent with the Company’s expectations.  

As in the past, Seacoast and its management continue to strongly support integrity and transparency in its financial disclosures and reporting its earnings results.  The accounting for the interest rate swap as a hedge by the Company was based upon the then current interpretation of the relevant accounting pronouncements’ documentation requirements.  The change in method announced today is the result of an unintentional misinterpretation of the technical documentation required at the inception of the hedge. Operating earnings per share, which exclude the impact of the swap, for the year 2004 totaled $0.98 up 10.1 percent from 2003.  Operating earnings for the fourth quarter of 2004 were $0.25 per share which represented a 4.2 percent growth over operating earnings one year earlier.  

“We regret that it was necessary to effect this change in accounting method.  We are pleased however to have ended the year with over $1.6 billion in assets and double digit increases in total revenues throughout 2004.  Increases in net interest income combined with growth in key fee-based businesses, indicate continued progress to provide strong long-term quality growth," commented Dennis S. Hudson, III, Chief Executive Officer of Seacoast.  “We will be working with our current and prior auditors to complete the 2004 audit and any appropriate restatements of prior quarterly results to reflect any material effects of this change in accounting method.”  

The increase in earnings and the Company’s improving performance in 2004 results from the implementation of a strategy to improve net interest margins and decrease interest rate risk by growing the commercial and consumer loan portfolios while reducing the relative size of the residential portfolio. These changes began to occur in late 2003 and continued throughout 2004 with double-digit loan growth and margin expansion. Additionally, solid core deposit growth combined with continued favorable low-cost funding aided in the growth in net interest income.  Earnings for the fourth quarter were reduced by $350,000 ($0.02 DEPS) in additional direct costs associated with implementing the requirements of the Sarbanes-Oxley Act and higher accounting fees.  

Highlights for the quarter and year included the following:

•

Record total revenues (net interest income and noninterest income combined excluding profits or losses on the interest rate swap) of $72 million, up 12.7 percent for the year and 15.9 percent in the fourth quarter;

•

Net interest margin expanded by 32 basis points to 3.89 percent for 2004;

•

Asset quality remained solid with total nonperforming assets of $1.4 million or a ratio of nonperforming assets to loans and other real estate owned 0.16 percent, compared to 0.43 percent at year-end 2003, and net charge-offs of 0.07 percent for the year compared to 0.10 percent for 2003;

•

Net interest income gained 19.8 percent on an annualized basis over the third quarter and was up $2.3 million or 19.5 percent over prior year's fourth quarter;

•

Fees from investment management services grew $181,000 or 18.3 percent compared to the fourth quarter 2003;

•

Average interest bearing deposits increased $50.1 million or 21.4 percent annualized during the fourth quarter; and average noninterest bearing deposits grew by $57.9 million or 92.1 percent annualized.  This growth  reflects a combination of organic growth and the impacts of proceeds from insurance settlements and increased business activity as a result of recent hurricane damage in our markets;

•

Loan balances rose 18.8 percent on an annualized basis from third quarter 2004 and were up $190.7 million or 26.9 percent for the year;

The net interest margin on a fully taxable equivalent basis for the quarter was 3.88 percent, an increase from the 3.70 percent achieved in last year's fourth quarter but a nine basis point decline from the 3.97 percent in the third quarter of 2004. The improvement in the net interest margin from the prior year resulted from increased asset yields, an improved earning asset mix, as well as growth in the loans outstanding.  The Company experienced substantial deposit growth in the fourth quarter as a result of insurance proceeds and increased business activity resulting from hurricane damage which occurred in September 2004.  These funds were invested in short term assets with lower yields which compressed the net interest margin in the fourth quarter. The net interest margin had steadily improved since the third quarter 2003.

Net interest income (on a tax equivalent basis) increased to $52,907,000 an increase of $8,597,000 or 19.4 percent compared to 2003’s total of $44,310,000.  The increase in net interest income resulted from the growth in the balance sheet and the favorable overall change in earning asset mix as the intended transformation of the loan portfolio resulted in higher interest income.  Average earning assets for the fourth quarter reflected an increase of $179.5 million or 14.1 percent over the last twelve months, and average loans (net) were up $187.8 million or 27.2 percent.

The cost of interest bearing liabilities declined to 1.44 percent from 1.46 percent in the fourth quarter 2003, but was higher by 7 basis points from the 1.37 percent in the third quarter. Interest expense as a percent of earning assets for the three months ended December 31, 2004, increased only 3 basis points to 1.09 percent compared to the third quarter 2004 and was 6 basis points lower compared to the same quarter in 2003.

The expansion into Palm Beach County has contributed to overall loan growth over the past twelve months. Total loans outstanding in the new market grew to $134.7 million with a total of $79.4 million funded during the past year. The addition of two full-service branches in Palm Beach County in the first quarter of 2005 will further expand the Company's loan origination capabilities.  For the year 2004, loan officers in this market originated a total of $ 126.5 million in loans (including unfunded commitments) and ended the year with a pipeline of approximately $125.0 million in additional pending loans.  Deposit balances for the Company in Palm Beach County now total over $68 million, of which 31.4 percent are noninterest bearing.  In addition, the cost of interest bearing deposits in the new market is comparable to the total bank with an average cost of 1 .68 percent.

Noninterest income, excluding securities gains and losses (and profits and losses on the interest rate swap), increased 5.4 percent when compared to the fourth quarter of 2003, reflecting growing revenues from investment management services, deposit based debit card and other EFT transactions, offset by lower revenues from mortgage banking operations (due to much lower refinance activities compared to 2003), which were down 25.2 percent in the fourth quarter compared to prior year quarter.   Revenues from investment management services began improving in the fourth quarter 2003.  These fees were $786,000 or 20.1 percent higher for the year versus 2003 and increased $181,000 or 18.3 percent in the fourth quarter 2004 compared to fourth quarter 2003.  Core deposit growth continued to enhance EFT fees, which were up 13 percent for the year, by increasing the customer base and usage of check cards.  During the year ended 2004, a total of $1.8 million in interchange income was earned compared to $1.5 million in 2003.  

The Company has maintained strong and consistent credit quality and historically maintained low net charge-offs. At quarter-end, nonperforming assets were $1,447,000, a decline of $1.6 million from last year.  Nonperforming loans to total loans stood at 16 basis points at year end and net charge-offs for the year were $562,000 or seven basis points. Continued strong loan quality supported an allowance for loan losses of 0.73 percent of total loans at December 31, 2004, a level lower than that found in many other banks.   During the quarter and the year, the Company provided $450,000 and $1 million, respectively, for loan losses reflecting strong loan growth.

Noninterest expenses totaled $12.1 million, an increase of 19.7 percent from the prior year's fourth quarter and an 11.3 percent increase for all of 2004 over 2003.  A portion of the growth is a result of increased wages, benefits, occupancy, marketing and other overhead due to the addition of branches and personnel in the Palm Beach and Brevard County markets, and from higher commissions, stock awards and other incentive compensation related to the Company's improved performance.  Also impacting overhead for the year was higher professional fees associated with the Company’s external audit and for assistance with the requirements of the Sarbanes-Oxley Act.  This added approximately $500,000 in additional direct expenses to overhead in 2004.

Seacoast will host a conference call tomorrow, February 15th at 11:00 AM (Eastern Time) to discuss the earnings results and business trends.  Investors may call in by dialing 800-693-5698 (pass code: 651588; moderator: Dennis S. Hudson, III). A replay of the call will be available on February 16th by dialing 866-837-8032 (domestic), using the pass code 651588.

Seacoast Banking Corporation of Florida has approximately $1.6 billion in assets. It is one of the largest independent commercial banking organizations in Florida, headquartered on Florida's Treasure Coast, one of the wealthiest and fastest growing areas in the nation.

- continued -

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast Banking Corporation of Florida ("Seacoast" or the "Company") to be materially different from future results, performance or achievements expressed or implied by such forward- looking statements. You should not expect us to update any forward-looking statements.

You can identify these forward-looking statements through our use of words such as "may", "will", "anticipate", "assume", "should", "indicate", "would", "believe", "contemplate", "expect", "estimate", "continue", "point to", "project", "could", "intend" or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic conditions; governmental monetary and fiscal policies, as well as legislative and regulatory changes; the risks of changes in interest rates on the level and composition of deposits, loan demand, and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks and sensitivities; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in the Company's market area and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; the failure of assumptions underlying the establishment of reserves for possible loan losses; the risks of mergers and acquisitions, including, without limitation, the related costs, including integrating operations as part of these transactions, and the failure to achieve the expected gains, revenue growth and/or expense savings from such transactions; changes in accounting interpretations; and the risks of possible further changes pending completion of the current audit and revi ew with the Company’s current and prior auditors of the prior periods during which the swap discussed herein was in effect.

All written or oral forward-looking statements attributable to the Company are expressly qualified in their entirety by this Cautionary Notice including, without limitation, those risks and uncertainties, described in the Company's annual report on Form 10-K for the year ended December 31, 2003 under "Special Cautionary Notice Regarding Forward-Looking Statements", and otherwise in the Company's SEC reports and filings. Such reports are available upon request from Seacoast, or from the Securities and Exchange Commission, including the SEC's website at http://www.sec.gov.

- ### -

EX-2

EXHIBIT 99.2

Seacoast Banking Corporation of Florida

Third Quarter Earnings Conference Call

November 19, 2004

11:00 a.m. ET

Moderator: Dennis S. Hudson, III

Operator:

Good day, ladies and gentlemen, and welcome to the Seacoast Banking Corporation of Florida 2004 Year-End Results conference call.  At this time, all participants are in a listen-only mode.  Later we will conduct a question and answer session, and instructions will follow at that time.  If you should require assistance during the conference, please press star, then zero, on your touch tone telephone.  As a reminder, this conference is being recorded.  

I would now like to introduce your host for today's conference, Mr. Dennis Hudson, President and Chief Executive Officer of Seacoast Banking.  Mr. Hudson, you may begin.

Dennis Hudson:

Thank you very much, and welcome to Seacoast's Fourth Quarter 2004 Earnings Conference Call.  Before I begin, I'd like to direct your attention to the statement at the end of our press release regarding forward statements.  During this call, we may be discussing certain issues that constitute forward-looking statements within the meaning of the Securities and Exchange Act, and accordingly are intended to be covered within the meaning of Section 27a of the Act.

With me today is Bill Hahl, our Chief Financial Officer, and Doug Gilbert, our Chief Operating Officer and President of our banking subsidiary.  We will all be available to answer any questions you might have following our prepared remarks.

We were pleased to announce strong results for the quarter and the year just ended.  The results for both the quarter and the year produced solid growth in just about every revenue item we report.  The quarter produced some of the strongest growth we've reported yet in our net interest income, which I believe reflects the continued progress we are marking towards improving our loan mix, as well as expanding into some exciting new markets.

In addition, in a minute, you will hear that our legacy markets have experienced significant growth this past quarter, which also contributed to our success.  Overall, our GAAP earnings for the year totaled 95 cents per share, diluted, and for the fourth quarter, 24 cents per share.  Both of these amounts were impacted by an accounting change, related to a swap transaction entered into early in 2003, which I will discuss in a minute.  But before I do, I'd like to point out that earnings before the impact of this accounting change were 98 cents for the year, up 10% from the prior year, and 25 cents per share for the quarter, up 4.2% from the year-ago quarter.  Furthermore, I would point out that earnings for the year and the quarter were also impacted by higher accounting and compliance costs, to the tune of two cents per share, primarily related to the Sarbanes-Oxley Act, and again, we'l l have some comments on that a little later.

As stated in our press release, we also announced that we are changing the accounting treatment related to an interest rate swap transaction entered into in early 2003.  This transaction was intended to effectively hedge the fair value of $54 million in fixed-rate certificates of deposits.  Doing so allowed the company to begin paying a variable rate of interest on the CDs, which reduced our exposure to the potential declining rate environment that we faced that year.  We carefully had modeled the expected effects of this swap, and consulted with advisers before entering into the transaction.  After undertaking this review, we determined, in early 2003, that this swap should be accounted for as a hedge under Financial Accounting Standard 133.  We considered this interest rate swap the simplest, most transparent way to reduce an identified interest rate risk, and indeed, the transact ion performed well.  It performed in accordance with its expected performance, and it met our economic objectives.

In connection with a more recent review of the transaction, we have concluded that our initial documentation of this swap as a hedge was insufficient to meet the precise current requirements and reviews of Financial Accounting Standard 133.  Accounting rules are extraordinarily complex in this area, and are subject to difficult judgments and interpretation.  We believed, based on all the information and advice available to us when we considered and entered into this transaction two years ago, that hedge accounting was appropriate.  At this time, however, we believe that changing our method of accounting for this transaction is the most conservative approach.  While this revised treatment is not expected to affect reported income for the entire year in 2003 or 2004, it may change reported GAAP income in certain prior quarters, requiring us to restate to reflect the marking of the swap to its market value at the end of each quarter.  We also believe that any restatements of prior quarterly results will not affect our previously reported cash flows or earnings on an operating basis, nor will it impact our capital adequacy.  We will be working with our outside auditors to complete the 2004 audit and any appropriate restatements of prior quarterly results to reflect this change in accounting method for the interest rate swap.

We will also continue to evaluate this transaction in the future, to determine whether it remains beneficial to the company under the revised accounting treatment and future interest rate conditions.  

We regret that we found it necessary to affect this change, but we are very pleased with our operating results this past quarter.  As I said earlier, earnings growth continue to be driven by growth in net interest income and continued solid performance in fee revenues, which Bill will speak to in a minute.  Net interest income has been up every quarter this year, with particularly strong performance this quarter.  Our net interest margin reached a high for the year last quarter and fell slightly this past quarter, but the decline in margin came on strong growth in net interest income and was due to typical seasonal deposit growth we experienced this quarter, as well as extraordinary deposit growth, resulting from the effects of the twin hurricanes earlier this year.  Insurance proceeds and federal assistance payments are now clearly flowing into the market.  Moreover, our strong com mercial penetration has allowed additional deposit growth, as our business customers have seen significant growth in business volumes, as they tackle the restoration work.  We ended the year with $1.37 billion in deposits, with 25% of those balances in non-interest bearing accounts, and we ended the year with $1.6 billion in assets.

We have also been sustaining growth in overhead over this past year, as we have expanded our footprint into Palm Beach County, to the south, and Melbourne, to the north.  In fact, during the quarter, we opened our third location in Palm Beach County, and began to add staff for our fourth location, which will open this quarter.  We also saw additional direct expenses associated with the hurricanes, as well as a slowing of fees related to residential closings, in part due to the lag of the hurricanes.  This quarter we also saw additional direct expenses associated with the final implementation of the Sarbanes-Oxley Act, and in particular Section 404.  We have spent over a half a million dollars in out of pocket costs on implementation and accounting fees related to Section 404 of the Act, with $300,000 of that amount expensed in the fourth quarter.

So overall, I feel the results for the quarter, and the year, considering the unusual impact of hurricanes earlier in the year, and increased costs of compliance, to be very solid.

Looking ahead to 2005, we expect to see continued progress in margin growth, as we carry out our goal to improve asset mix and maintain our low-cost deposit funding, the results of our strong relationship-based super community banking concept.  Our loan pipelines are as strong today as they were during 2004, and the local economy in our markets will likely continue to be supported with strong population growth.  We fully expect our overhead growth to begin to moderate, as we complete our current new branch build out in Palm Beach County and our growth and compensation expense will also slow some, given that some of the growth in compensation expense this past year resulted from full funding of various incentive plans, in response to improved growth rates.  We're also expecting the unusual costs associated with the hurricanes and compliance to be lower in the coming year.

During the quarter, we were also extremely pleased to announce our acquisition of Century National Bank in Orlando.  Century's local and experienced management team has produced a very strong company, with attributes that we find very attractive.  They have positioned themselves to focus on deep local relationships with small businesses and professional firms in the Orlando market.  They operate with a low-cost deposit mix that is even better than ours, and have a solid loan portfolio that has never seen a loss and rarely sees a past due account.  Combining our companies together will improve upon these factors that are currently driving our improvements in profitability and will allow Century to deliver larger commitments in the fast-growth, high-wealth markets of Orange and Seminole Counties in Orlando.  We expect to close the transaction early in the second quarter.  We expe ct little or no dilution out of the box, and the level of accretion going forward will depend entirely on how fast we can begin to produce higher levels of loan growth in the Orlando market.  

We said this year, 2004, would be a year of solid loan growth, and it was. We ended the year with almost $900 million in loans outstanding, and made great progress in transforming our loan mix.  We're now seeing the results of the adjustments we made to our business model two years ago.  These changes improved our growth in commercial business and continued to support our consumer business.  While we have long enjoyed our dominant position in the wealthy, high-growth Treasure Coast markets, we now have expanded into the larger markets of Palm Beach County and Melbourne, and soon, Orlando, where we are starting to become recognized as the local community bank best able to provide services needed by South Florida businesses.

So our expansion continues to build momentum, and we expect that this will continue over the next few years.  I'd now like to turn the call over to Bill Hahl, our Chief Financial Officer, who will further report on our results for the quarter.  Following Bill's comments, we'd be glad to take a few questions.  Bill?

Bill Hahl:

All right, thank you, Denny.  This year we reported much improved loan growth while maintaining our low-cost deposit funding.  In addition, much of our loan growth has occurred in commercial real estate construction loans, tied to prime, and will adjust, should interest rates continue to rise.  Commercial lending originations totaled $92 million in the fourth quarter.  The majority of this production will fund in 2005.  The growth in loan balances over the year of $190 million or 27%, exceeded our original projections and has improved our earning asset mix.  Average loan balances for the fourth quarter increased 6% over the third quarter and average deposits increased 9%.  Both results benefited the growth in net interest income, which was up 5% in the fourth quarter over third quarter results.  

The result of this loan and deposit growth in 2004 has allowed the company's net interest margin to expand by 32 basis points over the last 12 months.  We have included a chart on our website for this call that shows the growth in net interest margin and net interest income over the last 12 months.  Net interest income for the fourth quarter of 2004 increased $2.3 million, or 19.5%, over the prior year's fourth quarter.  While a portion of the better deposit growth in the fourth quarter is attributable to customer deposits of insurance proceeds from the damage caused by the two hurricanes directly hitting our markets, the deposit growth is also the result of de novo branch expansion in Palm Beach County and the continued population growth in our markets overall.  This, coupled with our relationship banking strategy, resulted in better deposit growth, particularly low-cost savings and non-interest bearing demand deposits.

Non-interest demand and low-cost savings deposit growth year over year totaled 48%, and 27%, respectively.  Total deposits increased $190 million in the fourth quarter, and repurchase agreements were up $25 million.  The significant influx of funds from deposits and the seasonal increase in repurchase agreement balances in the fourth quarter were invested in lower-yielding assets, with approximately $130 million in floating interest rates with average starting interest yields of 2% to 2.3%.  This resulted in a decline in the net interest margin in the fourth quarter compared to the third quarter of nine basis points.  The lower margin earned on the floating rate assets was approximately 1.38%, and negatively impacted the total margin by approximately 12 basis points.  The net interest margin should continue to expand in 2005 as the company increases its loan portfolio and improves i ts earning asset mix, as well as the expected rate increases that should occur in 2005.

Non-interest income results for the year were below the prior year, mostly due to mortgage banking fees, which were down $2.6 million, primarily as a result of higher refinance activities experienced throughout 2003.  However, residential mortgage originations were negatively impacted in the fourth quarter as a result of the hurricanes in late September.  Revenues from mortgage banking declined by $176,000 from the third quarter and originations in the fourth quarter remained lower than that experienced in the first nine months of the year.  Revenues from marine finance business in Florida were also negatively impacted by the hurricanes, with many yachts experiencing damage.  The marine finance business does experience seasonal patterns, and the fourth quarter is normally one of the stronger quarters.  Together, the estimated negative impact on non-interest income as a result of the hurricanes on these businesses in the fourth quarter was approximately $240,000.  

A component of non-interest income, which has rebounded, as expected, as a result of the improvements in the equity markets and the economy as a whole, are fees from investment management services.  On a year-over-year basis, the fourth quarter, revenues from investment management services increased 18%.  Revenues from this line of business, over the long term for our company, have increased at a compounded rate of approximately 10%, and we anticipate similar growth rates going forward.

Turning to non-interest expenses, which totaled $12 million for the quarter, and were impacted by the expenses, as Denny mentioned, for Sarbanes-Oxley, the hurricanes, professional fees for Sarbanes-Oxley implementation, additional staff for market expansion, incentive compensation tied to the improved earnings performance.  The combined impact on the fourth quarter on non-interest expenses related to the hurricanes and the one-time fees for Sarbanes-Oxley was approximately $350,000.  The overhead ratio for 2004 has been in the company's expected range during this period of de novo expansion.  We expected that the company's overhead ratio would average in the range of 65 to 67%, and we expect that to continue over the next 12 to 18 months, as we continue to add new branch locations; and then we expect it to decline into the low 60s, as we had during periods without this de novo expansion.

We continue to believe that our earnings per share will grow over this period of expansion with an 8 to 10% compounded annual growth rate, while we're adding more locations in Palm Beach County, and as Denny mentioned, Brevard County, in Melbourne, and also integrating our recent acquisition of Century National Bank.  Once the expansion is complete, earnings for the years 2006 to 2009 can grow at higher rates, and we believe will produce 15% to 18% compounded annual growth rates over the five-year period, beginning 2004 through 2009.

Dennis Hudson:

Thank you very much, Bill.  We appreciate your patience, and would now pause for any questions that anyone has, if the moderator could please announce.

Operator:  

Thank you.  Ladies and gentlemen, if you do have a question at this time, please press the one key on your touch tone telephone.  If your question has been answered or you wish to remove yourself from the queue, please press the pound key.  Once again, if you have a question, please press the one key.  Our first question comes from, David Honold of KBW.  

David Honold:

Good morning.

Dennis Hudson:

Good morning.

David Honold:

My first question is for Bill.  Do you mind repeating -- I didn’t catch the dollar amount of hurricane-related deposits and the spread that you invested those at.

Bill Hahl:

David I’m not… I didn’t really mention the exact amount of hurricane deposits.  We have estimated them in the range of about $150 million through the end of the year, and what I did mention was that $130 million of those funds, those excess funds (we believe), were invested in floating-rate assets.

David Honold:

And the rate on those?

Bill Hahl:

The rate was… the starting rates were 2 to 2.3%.

David Honold:

Okay, great so that’s roughly the margin that they were invested at?

Bill Hahl:

Right.

David Honold:

Okay, thanks.  

Operator:

Thank you.  Once again, if you have a question please press the one key on your touchtone telephone.  Our next question comes from Christopher Marinac of FIG Partners.

Bret Velome:

Hello fellows.

Bill Hahl:

Morning Chris.

Bret Velome:

This is not actually Chris.  This is Bret Velome (ph).  Chris couldn’t be on the call.  He wanted to ask you though about specifically was the Sarbanes-Oxley cost, and also the extra overhead, basically about $0.5 million, do you expect that to continue going forward in 2005?  And at what level if so?

Bill Hahl:

I think… well there’s going to be some level of costs that are going to remain.  There were implementation costs that I believe are one-time costs that probably ranged in the $150,000 to $200,000 range for Sarbanes-Oxley.

Bret Velome:

Okay.  

Dennis Hudson:

That’s somewhat speculative though, because we’re just going to that level of determining what the ongoing expenses will be.  Clearly they’re not going to be a significant as it was in ’04 however.

Bret Velome:

Right, and just to clarify, you said that your expansion period you estimated was going to 12 to 18 months.  Is that correct?

Dennis Hudson:

Yes.

Bret Velome:

Okay, and then I just had one last question.  I notice that your provision expense increased significantly in the fourth quarter.  What was the reasoning behind that, and do you expect that to continue?

Dennis Hudson:

It was driven by both continued strong loan growth as well as a higher level of losses taken in the fourth quarter.  Still a very nominal number, but an increase over the third quarter and the second quarter.  And in terms of our expectations going forward, I think we’re going to have continued -- and I think if you looked at the results for the year in ’04-- we’ll have similar kinds of results in ’05 at this point.

Bret Velome:

Okay, thank you very much gentlemen.

Operator:

Thank you.  Our next question comes from Barry McCarver, Stephens Inc.

Matt Olney:

 Good morning guys.

Dennis Hudson:

Good morning Barry.

Bill Hahl:

Good morning Barry.

Barry McCarver:

This actually isn’t Barry, it is Matt Olney.  Barry couldn’t be here this morning.

Dennis Hudson:

Okay.

Matt Olney:

But anyway, all the attention that management has given to the Sarbanes-Oxley compliance issue and the recent accounting issues, do you think it’s possible that de novo branching is going to slow down in ’05, or perhaps even the closing date of the Century National acquisition is going to be pushed back at all as a result of this?

Dennis Hudson:

We don’t think so.  We’re going to strive not to have it impact that.  I think most of those issues have already been felt in terms of their impact on management and the like.  I think we just need to complete our work with our audit firm at this point, and we intend to do that in the next couple of weeks.

Matt Olney:

All right, thanks.

Operator:

Thank you.  Our next question comes from Peyton Green of FTN Midwest.

Peyton Green:

Good morning.

Dennis Hudson:

Good morning.

Peyton Green:

I was wondering if y’all could comment a little bit, I mean the loan growth outlook still remains very, very bullish.  What is your best guess in terms of the deposit flows and when you might see some movement out of those funds?  How should we think about that?

Bill Hahl:

That’s a pretty hard question to answer.  I don’t know that we have an answer for it Peyton.  It’s kind of a new experience I think for the whole State to some degree.  I know that it’s very complicated because a lot of our deposit growth this last year has been impacted by our success in the lending area.  And our ability to pick up new relationships on the deposit side, particularly in the commercial area as we have brought increased focus in that area.  

So it’s, we know for a fact that a significant amount of the -- and a lot of that growth, by the way, has come out of Palm Beach County.  In fact, we’ve disclosed numbers to you I think this past year, well I think at the end of the year, we disclosed around $70 million in deposits in Palm Beach County with a very significant amount of that DDA.  Clearly that was all from new relationships that didn’t exist a year earlier, and clearly as a result of a lot of commercial activity throughout that market.

So we have that factor to factor in, but I think it’s clear to us that a certain amount of the deposit growth certainly is related to the hurricane work.  Living here, as we all do, and looking at the progress on that work, the progress is beginning to get made.  But I think it’s going to stretch out probably for a longer period of time than any of us anticipated initially.  So I don’t think it will involve a drop out you know in the next quarter, Peyton.  I think it’s going to be a slow bleed-off probably out -- I don’t know Doug, what are your thoughts?  Through the end of the year?

Doug Gilbert:

Probably through the end of the year, but I think we can offset that pretty significantly by the growth down in Palm Beach County and our own organic growth within the three counties.

Bill Hahl:

Yeah, I think it’s going to be less severe than we might have anticipated at the beginning because of all the other factors that are impacting our overall deposit performance here.

Peyton Green:

Okay, then can you give any color on how Century looks towards the end of the year?

Bill Hahl:

We’re on track, they’re on track with their projections, and we continue to move that forward.

Peyton Green:

Okay.

Bill Hahl:

We think there possibly will be a small delay in closing, but on the order of weeks as opposed to anything significant.  The press is on to just complete our work, and I think we are prepared to get that done in the next couple of weeks.

Peyton Green:

Okay, so again to characterize, the deposits may stick around for three or four quarters instead of what people feared was a one to two quarter in-and-out type movement-- because I mean anecdotally I’ve heard a lot just in terms of getting people to do the work.

Dennis Hudson:

Right, exactly right.

Peyton Green:

It’s not quite as easy as it looks on paper.  Okay, and in terms of credit, was there anything in particular that happened that caused -- I mean I know that y’all dance on the top of a pin, but what actually happened in the quarter in terms of the $2 million in flow?

Dennis Hudson:

With regard to what?

Peyton Green:

With the credit, it seemed like y’all had about $350,000 in charge-offs and about $1.5 million in NAs.

Dennis Hudson:

Yeah, and we probably won’t comment on the exact details of the charge-off, but Doug could probably give us some color on the nature of that.

Doug Gilbert:

Well, it was a case where we discovered a fraud by one of our customers, and we’re still trying to work on that.  But rather than carry it as an asset when we discover a problem, normally we’re pretty fast about charging it off and then working it as a charge-off.  

Dennis Hudson:

So this was a single customer, it involved fraud, and the fraud you know, caused us to charge the entire credit off.

Peyton Green:

Oh okay.

Dennis Hudson:

And so we have currently no further exposure to the company that was involved in the fraud, and are actively pursuing action against that company and the individuals.  And I would say, Doug, we don’t anticipate any recovery at this point?

Doug Gilbert:

We don’t anticipate any major recovery.

Dennis Hudson:

Yeah.

Peyton Green:

Was that all the charge-off activity in the quarter, or was there charge-off activity related to other stuff too?

Doug Gilbert:

No, that was it, other than a few installment loans.  

Dennis Hudson:

But that was all but a few thousand dollars worth, and we may have even had some recoveries as I recall offsetting that in some small fashion as well.

Peyton Green:

Okay, then the movement I guess was about $1 million into NAs.  Was there anything in particular there or is that just something moved.

Doug Gilbert:

That was a movement down where we had, I think, in the third quarter of last year, where we had ORE property that we were successful in disposing of with no loss, in fact with a small gain.

Dennis Hudson:

No substantial or notable issues with regard to the movement in that number.

Doug Gilbert:

If you look at our net charge-off ratio, it still came in at a .07.

Peyton Green:

No, I just wanted to make sure though.  I mean all of the fourth quarter activities related to one action.

Doug Gilbert:

Correct.

Dennis Hudson:

Correct.

Peyton Green:

Great, thank you very much.

Dennis Hudson:

Thank you Peyton.

Operator:

Thank you.  Our next question comes from Wadad Cortas of Sidoti and Company.

Wadad Cortas:

Hi, how are you?  I had two questions for you guys.  First, I notice that they added two Palm Beach branches in the first quarter, there is also the Bank Atlantic branch that you bought, could you just remind me how many additional branches you expect to add during the year?

Dennis Hudson:

The year coming up?

Wadad Cortas:

Yes, in 2005.

Dennis Hudson:

Just the one, we have one for sure that is opening and we have two that we are negotiating that may or may not hit this year.  And if it did hit it would be late this year.  

Wadad Cortas:

Okay.

Dennis Hudson:

So I would say honestly, or accurately, that we for sure will have one, and that will happen in the next couple of weeks actually.

Wadad Cortas:

Okay.

Dennis Hudson:

And that will pretty much be it, although we may have a couple that we will add at the end of the year.  Very little impact on this year, though, other than the one.  But kind of the worst is over in a sense.

Wadad Cortas:

Okay, and then just curious, did you book any security gains in the quarter?

Bill Hahl:

No.

Wadad Cortas:

No, okay great, that’s all I had.  Thank you.

Bill Hahl:

Thank you.

Operator:

Thank you.  Our next question is from Gary Tenner of SunTrust Robinson-Humphrey.

Gary Tenner:

Thanks, good morning.

Bill Hahl:

Good morning Gary.

Gary Tenner:

My questions have largely been answered.  Just wonder if you would comment on deposit pricing pressures that you may have seen during the quarter versus prior quarters.

Bill Hahl:

None too bad really.  There’s a lot of pressure on the short-term CD rates.  We’ve got all kinds of competitors in the markets.  A lot of them paying -- well at …the end of the quarter in December a couple of them started paying 3% for six-month CDs.

In terms of just plain basic core deposit-type products, there hasn’t been very much pressure at all.  There’s been different promotions, maybe a savings account with a high rate for six months guaranteed, and then it floats back to whatever their normal rate is, that type of thing.  So you saw that in the quarter, we had maybe a couple of basis point increase in our overall cost of funds.  So very well controlled so far.

Gary Tenner:

Okay, and where would you characterize your pricing relative to the market right now?

Bill Hahl:

Well, typically over overall cost of funds have always been in the lowest quartile.  And when we’ve looked at the local competitors we tend to average probably 20 to 40 basis points, depending on where we are in the cycle, lower in overall costs.  We compare ourselves weekly and we try to be sort of in the middle of the pack, not at the way low end or all the way at the top.

Gary Tenner:

Okay, so no real changes; okay, thank you guys.

Bill Hahl:

All right, thank you.

Operator:

Thank you.  Our next question is a follow up from David Honold of KBW.

David Honold:

Hey, thanks.  A question relating to the loan pipeline, I realize it’s particularly strong in Palm Beach, but how does the $125 million pipeline there compare to sort of your overall loan pipeline at this point?

Dennis Hudson:

It’s roughly the same.  Doug indicated it’s roughly the same kind of number for the rest of our pipeline on our markets where we’ve operated for a longer period of time.  And I would say that Doug, that would represent what we believe to be a pretty strong healthy number historically.

Doug Gilbert:

Correct, it absolutely is.  

Dennis Hudson:

So suffice it to say that we’ve had some tremendous success in Palm Beach County that is making an incremental difference, a positive difference, but we’re also seeing what we believe is a very robust and healthy pipeline, potential new business, throughout our markets.  

David Honold:

Right, so it’s roughly a $250 million total pipeline?

Dennis Hudson:

Roughly.

David Honold:

And then could you just give us an update on your thoughts on the outlook for the reserve, given that the growth is so strong and that it is concentrated in more commercial and less consumer, residential-type products?

Dennis Hudson:

You know, I guess the only thing we can say is that our asset quality measures do not appear to be driving any significant change in our provisioning behavior.  What will drive it as we continue to go forward will be the kind of growth that we sustain.

I’d also point out to you that the commercial growth that we are seeing, although it is a shift in mix, which needs to be taken into account, and we are, is primarily concentrated, almost exclusively, in secured loans, secured with real estate and the like.  And so the loss characteristics on that portfolio, given its secured nature from a risk standpoint, has not produced any evidence to suggest that, we’re going to see incrementally higher levels of provisioning related to any credit quality issues.  So the only factor really driving it will continue to be growth.  And so the provisioning going forward is going to be based on what our analysis suggests.  And we’re not here to speculate on that other than to say at the moment the only driver we see is growth, and I think we’ve been able to demonstrate that as we have done over the last couple of years.

David Honold:

Thanks.

Operator:

Thank you.  Our next question is a follow up from Peyton Green of FTN Midwest.

Peyton Green:

Yes, I was just wondering with respect to the marine origination business, is there any catch-up that you expect to get in the first quarter, or do you think …. there is a pent-up demand that’s still there that will ultimately fund, or is it something that may take a little longer or disappear?

Doug Gilbert:

Well Peyton, this is Doug Gilbert.  The Miami Boat Show in fact starts this week, and that’s one of our big drivers for volume.  We pick up some business during the show, but we pick up a tremendous amount of leads that we follow for one or two quarters after the boat show.  So our volumes normally pick up in and around the major boat shows:  the Fort Lauderdale, the Miami, the West Palm Beach shows.  So we have the Miami Show coming up this week, and then in March or April, I believe it is, we have the Palm Beach Boat Show.  

And I would say there is some pent-up demand out there, because there were a large number of vessels totally destroyed and people are just now really starting to get their settlements on the ones destroyed, and I’m sure the majority of them will be back in the market looking for boats.  So I think it should pick up in this quarter and the second quarter.

Peyton Green:

Okay, so if the first and second quarters are like they were in ’03 and in ’04, they should be pretty darn strong in ’05?

Doug Gilbert:

They should be; we’ve got our fingers crossed.

Peyton Green:

Okay great, thank you very much.

Operator:

Thank you.  Gentlemen I’m showing no further questions at this time.

Dennis Hudson:

Okay, well we sincerely appreciate your attendance this morning, and we’re pleased to report what we think is our continued progress and look forward to continuing to have calls with you beginning after the first quarter.  Thank you.

Operator:

Ladies and gentlemen, thank you for participating in today’s conference.  This concludes the program.  You may now disconnect.  Thank you and have a great day.

EX-3

EXHIBIT 99.3

Seacoast Banking Corporation of Florida

Fourth Quarter 2004 Financial Highlights

Cautionary Notice Regarding Forward-Looking Statements

This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about the benefits of the merger between Seacoast and Century, including future financial and operating results, cost savings, enhanced revenues, and accretion to reported earnings that may be realized from the merger, as well as statements with respect to Seacoast’s and Century’s plans, objectives, expectations and intentions and other statements that are not historical facts.  Actual results may differ from those set forth in the forward-looking statements.

Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements.  

You can identify these forward-looking statements through our use of words such as “may,” “will,” “anticipate,” “assume,” “should,” “indicate,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “point to,” “project,” “could,” “intend” or other similar words and expressions of the future.  These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic conditions; governmental monetary and fiscal policies, as well as legislative and regulatory changes; the risks of changes in interest rates on the level and composition of deposits, loan demand, and the values of loan collateral, securities, and interest sensitive assets and liabilities ; interest rate risks and sensitivities; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses.  The risks of mergers and acquisitions, include, without limitation: unexpected transaction costs, including the costs of integrating operations; the risks that the businesses of Seacoast and Century will not be integrated successfully or that such integration may be more difficult, time-consuming or costly than expected; the potential failure to fully or timely realize expected revenues and revenue synergies, including as the result of revenues following the merger being lower than expected; the risk of deposit and customer attrition; any changes in deposit mix; unexpected operating and other costs, which may differ or change from expectations; the risks of customer and employee loss and business disruption, including, without limitation, as the result of difficulties in maintaining relationships with employees; the risk of obtaining necessary governmental approvals of the merger on the proposed terms and schedule; the potential failure of Century’s shareholders to approve the merger; increased competitive pressures and solicitations of Century’s customers by competitors; as well as the difficulties and risks inherent in seeking to increase the volume of loans in the highly competitive Orlando market.

All written or oral forward looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2003 under “Special Cautionary Notice Regarding Forward-Looking Statements,” and otherwise in our SEC reports and filings.  Such reports are available upon request from Seacoast, or from the Securities and Exchange Commission, including through the SEC’s Internet website at http://www.sec.gov.

Other Important Information About this Presentation

Century’s shareholders are urged to read the proxy statement/prospectus regarding the proposed transaction when it becomes available, because it will contain important information about Seacoast, Century and the proposed transaction.  Century’s shareholders will be able to obtain a free copy of the proxy statement/prospectus, as well as other filings containing information about Seacoast and Century, without charge, at the SEC’s Internet website at http://www.sec.gov.  Copies of the proxy statement/prospectus and the filings with the SEC that will be incorporated by reference into, or otherwise referred to in, the proxy statement/prospectus can also be obtained, without charge, by directing a written request to Seacoast Banking Corporation of Florida, 815 Colorado Avenue, Stuart, Florida 34994, Attention: Office of the Secretary, or to Century National Bank, 65 North Orange Avenue, Orlando, Florida 32801, Attention:  Officer of the Secretary.

The respective directors and executive officers of Seacoast and Century and other persons may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction.  Information regarding Seacoast’s directors and executive officers is available in its proxy statement filed with the SEC by Seacoast on March 5, 2004, and information regarding Century’s directors and executive officers can be obtained upon written request to Century as provided above.  Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained the proxy statement/prospectus and other relevant materials to be filed with the SEC when they become available.

This presentation does not constitute an offer to sell, or a solicitation of an offer to buy, shares of Seacoast’s common stock, or the solicitation of any proxies from Century’s shareholders.

Total Revenues Increase

•

Revenues up 12.6 percent

	2004 YR	2003 YR	Variance
Net Interest Income	$ 52,907	$ 44,310	$ 8,597
Noninterest Income	19,207	19,725	(518)
Total Revenues	$ 72,114	$ 64,035	$ 8,079

*

Dollars in thousands; excludes provision for loan losses and interest rate swap profits and losses; calculated on a fully taxable equivalent basis using amortized cost

Net Interest Margin and Net Interest Income

	4Q 2003	1Q 2004	2Q 2004	3Q2004	4Q2004
Net Interest Margin	3.70%	3.84%	3.84%	3.97%	3.88%
Net Interest Income	$11,858	$12,467	$12,784	$13,498	$14,158

*

Dollars in thousands; excludes provision for loan losses; calculated on a fully taxable equivalent basis using amortized cost

Investment Management Services Income

(Dollars in thousands)

●

Financial Services Income Up 20%

	1Q 2004	2Q 2004	3Q 2004	4Q 2004
Trust Income	$    538	$    517	$    556	$    639
Brokerage Income	715	671	523	533
Total Financial Services Income	$ 1,253	$ 1,188	$ 1,079	$ 1,172

	2004		2003		Variance
Trust Income	$ 2,250	$ 2,043		$  207
Brokerage Income	2,442	1,863		579
Total Financial Services Income	$ 4,692	$ 3,906		$ 786

Loan Growth Remains Strong at a 26.9% Growth Rate Year-over-Year

(Dollars in thousands)

	4Q 2003	1Q 2004	2Q 2004	3Q2004	4Q2004
Loan Outstandings	$ 708,792	$ 739,803	$ 789,344	$ 859,173	$ 899,547

Commercial Loan Originations Remain Strong, Down from Third Quarter

(Dollars in thousands)

	1Q 2004	2Q 2004	3Q 2004	4Q 2004
Commercial Originations*	$ 61,603	$ 85,664	$ 133,160	$  91,643

*  Includes commerical real estate

Consumer Lending Up 6.1% Over Last Twelve Months

(Dollars in thousands)

	4Q 2004	4Q 2003
Consumer Outstanding Balances*	$ 146,481	$ 138,037

*  Includes second mortgages and booked marine loans

	1Q 2004	2Q 2004	3Q 2004	4Q 2004
Booked Marine Production	$ 554	$ 1,901	$9,708	$3,590

Seacoast Marine Income

(Dollars in thousands)

	1Q 2004	2Q 2004	3Q 2004	4Q 2004
Florida Marine Production	$ 14,533	$ 21,245	$ 18,608	$ 14,704
California Marine Production	$ 26,121	$ 31,393	$ 23,001	$ 21,349
Marine Fees	$     763	$     994	$     640	$     600

Mortgage Originations

(Dollars in thousands)

	4Q 2004	4Q 2003
Residential Originations	$ 222,277	$ 192,354

	1Q 2004	2Q 2004	3Q 2004	4Q 2004
Mortgage Banking Fees	$     482	$     472	$   523	$   347

Deposits Up 21.4% Over Last Twelve Months

(Dollars in thousands)

	4Q 2004	4Q 2003
Total Deposits	$ 1,371,902	$ 1,129,642

Deposit Mix

	Dec. 31, 2003	Dec. 31, 2004
Savings	46.69%	48.77%
Demand	20.63%	25.16%
Time Deposits	32.68%	26.07%
Total	100.00%	100.00%

Overhead Ratio

	1Q 2003	2Q 2003	3Q 2003	4Q 2003	1Q 2004	2Q 2004	3Q 2004	4Q 2004
Overhead Ratio*	63.9%	65.9%	67.9%	62.9%	66.7%	65.1%	65.6%	65.0%

*  Excludes security gains and losses and interest rate swap profits and losses