8-K

8-K – page # of 5

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)  January 25, 2007

    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 5

SEACOAST BANKING CORPORATION OF FLORIDA

Item 2.02

Results of Operations and Financial Condition

On January 25, 2007, the Registrant announced its financial results for the fourth quarter and year ended December 31, 2006.  

A copy of the press release announcing the Registrant’s results for the fourth quarter and year ended December 31, 2006 is attached hereto as Exhibit 99.1 and incorporated herein by reference.  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, including, without limitation, statements about future financial and operating results, cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls, as well as statements with respect to Seacoast’s objectives, expectations and intentions and other statements that are not historical facts.  Actual results may differ from those set forth in the forward-looking stateme nts.

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,” “support”, “indicate,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “further”, “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 and market conditions, including seasonality; 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 deman d, and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; 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 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; increased competitive pressures and solicitations of customers by competitors; as well as the difficulties and risks inherent with entering new markets.

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, 2005 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.

Item 7.01

Regulation FD Disclosure

On January 26, 2007, the Registrant held an investor conference call to discuss its financial results for the fourth quarter and year ended December 31, 2006.  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) containing information used in the conference call and incorporated herein by reference.  All information included in the transcript and the charts is presented as of December 31, 2006, 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 January 25, 2007 with respect to Seacoast Banking Corporation of Florida’s financial results for the fourth quarter and year ended December 31, 2006.
99.2	Transcript of Registrant’s investor conference call held on January 26, 2007 to discuss the Registrant’s financial results for the fourth quarter and year ended December 31, 2006.
99.3	Data on website containing information used in the conference call held on January 26, 2007 to discuss the Registrant’s financial results for the fourth quarter and year ended December 31, 2006.

8-K – page # of 5

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:   

January 30, 2007

By:

/s/ William R. Hahl

Name:

William R. Hahl

Title:  

Executive Vice President &

Chief Financial Officer

EX-99.1

EXHIBIT 99.1

To 8-K dated January 25, 2007

NEWS RELEASE

SEACOAST BANKING CORPORATION OF FLORIDA

Dennis S. Hudson, III

Chairman 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 EARNINGS OF $ 23.9 MILLION FOR 2006

STUART, FL., January 25, 2007 – Seacoast Banking Corporation of Florida (NASDAQ:  SBCF), a bank holding company whose principal subsidiary is Seacoast National Bank, reported net income totaling $23.9 million for 2006, compared to $20.8 million for the prior year.  Diluted earnings per share (“DEPS”) was $1.28 for 2006, compared to $1.24 DEPS for the prior year, an increase of 3.2 percent.  Cash operating earnings*, excluding the impacts of merger and other charges net interest rate swap (profits) losses, a non-recurring gain on the sale of a partnership interest, and amortization of core deposit premium, totaled $1.30 DEPS, up 2.4 percent from a year ago.  

While earnings for the entire year improved, results for the last two quarters were affected by a more challenging interest rate environment and deposit declines as a result of the slowdown in Florida housing activity [and intensified deposit competition] that emerged during the second half of 2006.  Fourth quarter earnings totaled $0.30 DEPS compared to $0.34 DEPS a year ago and $0.31 DEPS for the third quarter 2006.  Earnings for the quarter were impacted by a substantial increase in the provision for loan losses.  During the quarter, the Company undertook a comprehensive review of all large credits, primarily construction loans, where the primary source of repayment is related to the sale of residential real estate.  The review was undertaken to ensure that there was proper identification of risks associated with rec ent changes in market conditions impacting the Florida real estate market.  While no immediate losses or impaired loans were identified, the change in market condition was partially responsible for an increased provision in the fourth quarter totaling $2,250,000 or $0.08 DEPS, compared to $330,000 or $0.01 DEPS a year ago and $475,000 or $0.02 DEPS in the third quarter 2006.  The Company anticipates future provisioning to be more closely aligned with loan growth.

Revenues grew in the fourth quarter with fees from mortgage banking activities and marine finance fees improving, as expected, from third quarter results.  The Company also realized a gain related to the sale of an office building in which Seacoast National Bank was a 10% limited partner during the fourth quarter which totaled $1.1 million or $0.04 DEPS.

“Seacoast ends an eventful and challenging 2006 with a strong balance sheet and the people, processes, capital, and expanded markets to allow for stronger future performance,” commented Dennis S. Hudson, III, Chairman and Chief Executive Officer of Seacoast.    

Highlights for the year included the following:

•

Loan balances grew by 34.4 percent for the year and stood at $ 1.733 billion, including organic growth of 18.5 percent, and fourth quarter loan balances increased $77 million;

•

Net interest margin for the year increased by 18 basis points to 4.15 percent;

•

Earning assets increased $193 million to $2.18 billion for the year ended 2006;

•

Deposit mix remained favorable compared to peers with noninterest bearing deposits to total deposits at 20.7 percent at year-end;

•

Fees from wealth management services increased $725,000 or 14.1 percent;

•

Debit card and other electronic transaction fees increased $439,000, up 20.6 percent as a result of more customers and increased transactions;

•

As in the past, the Company has no significant wholesale borrowings;

•

The loan-to-deposit ratio at year-end was 92 percent, compared to 72 percent one year earlier;

•

Big Lake National Bank (acquired on April 1, 2006), and Century National Bank were successfully integrated and rebranded, along with our legacy bank charter, First National Bank & Trust Company of the Treasure Coast,  into Seacoast National Bank;

•

Tangible equity to assets increased to 6.49 percent at year-end, compared to 5.57 percent a year ago;

•

Additional opportunities arose to take advantage of potential market disruptions with the recent sale by two of the Company’s largest local Treasure Coast competitors to a large Ohio-based institution;

•

During the third quarter, the State of Florida and local governments concluded final negotiations that will locate three major California-based biotech research firms in the Company’s markets.  These firms will use state and local funding to “seed” infrastructure development needed to attract other research firms and ancillary businesses to the State over the next few years; and

•

During the second half of the year, CVS Pharmacies opened a major regional distribution center in Indian River County, which will employ 350 workers by the end of 2007.  

The net interest margin for the fourth quarter was 3.95 percent, representing a decline from the 4.04 percent achieved during the same period one year earlier and 4.22 percent in the third quarter of 2006.  The decline in the net interest margin resulted from a continued shift in deposit mix from lower cost deposits to higher cost time deposits resulting from an inverted yield curve, increased deposit competition, and from seasonal increases in public fund customer balances that result in spreads of less than 1.0%.

The cost for interest bearing deposits increased to 3.25 percent from 2.95 percent in the third quarter 2006 and 2.05 percent in the fourth quarter a year ago.  Average noninterest bearing demand deposits declined by $23.6 million and average lower cost savings, NOW and money market balances declined $34.6 million, compared to the third quarter 2006, while higher cost average time deposits increased $28.9 million.

Net interest income for the fourth quarter declined by $1.3 million or 5.6 percent from the third quarter, but was up $1.8 million or 8.9 percent when compared to fourth quarter 2005.  Operating revenue totaled $27.5 million a decline of $1.1 million from the third quarter, but increased year-over-year by $2.4 million or 9.4 percent.  The pressure on the net interest margin, and net interest income, are likely to carryover into 2007, although more modestly than in the second half of 2006, provided loan growth targets are achieved.  The Company is reviewing balance sheet strategies to lessen the margin impact of a continued inverted yield curve.

Average loans outstanding increased 35.9 percent compared to the same quarter one year earlier.  This growth resulted from strong organic growth in the Company’s markets as well as an acquisition completed in the second quarter of 2006.  The impact of a slower housing market is impacting the Company’s loan pipelines and it is believed that slower growth will result for 2007.  The Company’s expansion into Palm Beach and Brevard counties and its acquisitions over the past two years has allowed for greater loan opportunities and the Company expects loan growth to range in high single digits in 2007.  The recent acquisition of the Company’s two largest community bank competitors by a large Cleveland, Ohio based bank and the integration and rebranding planned for early 2007 could improve the Company’ s prospects for loan and deposit growth in 2007.

Noninterest income, excluding securities gains (losses) and the nonrecurring gain on the sale of a partnership interest of $1.1 million, increased 12.7 percent when compared to the prior year, reflecting increased revenues from debit card interchange fees, merchant income, and Trust and investment management services, as well as increased fees from service charges on deposit accounts as a result of the acquisition of Big Lake National Bank.  During the past two years, noninterest income related to mortgage loan production has declined due to lower volumes and more production being retained in the loan portfolio.  Total outstanding residential loan balances have increased 18 percent over the past year in a higher rate environment.   The Company expects that fee income from mortgage banking activities will continue to b e challenged due to a slower housing market.  For the total year 2006, commissions and fees from Trust and investment management services increased 14.1 percent compared to 2005.  Over the long term, the Company expects fees from wealth management services to grow at a rate of approximately 10 percent per year.

Noninterest expenses declined $714,000 or 3.8 percent from the third quarter, as a result of lower incentive expense based on the decline in the rate of earnings growth and the Company’s overall performance compared to expectations.  Noninterest expenses for the quarter included added spending related to rebranding the subsidiary bank and costs associated with attracting customers of the acquired local competitors, totaling approximately $314,000 or $0.01 DEPS.  The Company is completing a review of its processes, operations and costs, and based on this review, the Company has targeted quarterly overhead to remain relatively flat in 2007 when compared to 2006, after adjusting for the acquisition completed in the second quarter of 2006.

The Company has maintained strong and consistent credit quality and low net charge-offs over the long term and consistently lower net charge-offs than its peers.  Remarkably, net loan recoveries of $106,000 were recorded for 2006, compared to net charge-offs of $134,000 for 2005.  Nonaccrual loans and loans past due 90 days to average loans totaled 0.72 percent at year-end 2006, up from 0.03 percent a year earlier.  Most of this increase was related to a loan placed on nonaccrual during the third quarter of 2006 which has a current balance of approximately $8.0 million.  This loan is secured with both new and used boat inventory which is in the process of being liquidated.  This relationship dates back a number of years and represents the only retail floor plan loan in the Company’s loan portfolio.  The m arket value of the collateral is believed to be sufficient to cover the loan balance, provided the liquidation occurs on a timely basis and in an orderly fashion.  The borrower recently filed for bankruptcy protection and the Company immediately increased the specific loan loss allowance established last quarter from $280,000 to $1.1 million.

Seacoast will host a conference call on Friday, January 26 at 9:00 a.m. (Eastern Time) to discuss the earnings results and business trends.  Investors may call in (toll-free) by dialing (866) 418-3599 (access code: 16765488; leader: Dennis S. Hudson).  Charts will be used during the conference call and may be accessed at Seacoast’s website at www.seacoastbanking.net by selecting Presentations under the heading Investor Services.  A replay of the call will be available beginning the afternoon of January 26 by dialing (877) 213-9653 (domestic), using the passcode 16765488.

Seacoast, with approximately $2.4 billion of assets, is one of the largest independent commercial banking organizations in Florida.  Seacoast has 43 offices in South and Central Florida and is headquartered on Florida’s Treasure Coast, which is one of the wealthiest and fastest growing areas in the nation.

*

The Company believes that cash operating earnings, excluding the impacts of noncash interest rate swap fair value changes, noncash amortization expense, the merger costs related to the Big Lake acquisition, gain on sale of a partnership interest, and costs associated with the name change for the Company’s primary banking subsidiary, is a better measurement of the Company’s trend in operating earnings growth.  Net cash payments and receipts from the interest rate swap have been immaterial for the periods presented.

Cautionary Notice Regarding Forward-Looking Statements

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, including, without limitation, statements about future financial and operating results, cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls and for integration of banks that we have acquired, as well as statements with respect to Seacoast’s 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,” “support”, “indicate,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “further”, “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 and market conditions, including seasonality; 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 de posits, loan demand, and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; 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 will not be integrated successfully or that such integration may be mor e 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; increased competitive pressures and solicitations of customers by competitors; as well as the difficulties and risks inherent with entering new markets.

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, 2005 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.

- continued -

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FINANCIAL  HIGHLIGHTS				(Unaudited)
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES
		Three Months Ended					Twelve Months Ended
(Dollars in thousands,		December 31,						December 31,
except per share data)		2006			2005				2006		2005
Summary of Earnings
Net income (GAAP)	$	5,685	$		5,833			$	23,854	$	20,759
Merger and other charges		--			--				576		--
Earnings, excluding merger and other
charges		5,685			5,833				24,430		20,759
Amortization of core deposit premium		205			77				696		346
Gain on sale of partnership interest		(746)			--				(746)		--
Net interest rate swap (profits) losses		--			--				--		173
Cash operating earnings*	$	5,145	$		5,910			$	24,380	$	21,278
Net interest income  (1)	$	21,846	$		20,062			$	89,294	$	72,297
Performance Ratios
Return on average assets  (2), (3)
Using GAAP earnings		0.95	%		1.10	%			1.03	%	1.07	%
Using cash operating earnings* on average tangible assets		0.88			1.13				1.08		1.11
Return on average
shareholders' equity  (2), (3)
Using GAAP earnings		10.57			14.96				12.06		14.95
Using cash operating earnings* on average tangible equity		12.99			19.48				16.64		18.45
Net interest margin  (1), (2)		3.95			4.04				4.15		3.97
Per Share Data
Net income diluted (GAAP)	$	0.30	$		0.34			$	1.28	$	1.24
Merger and other charges		--			--				0.03		--
Earnings, excluding merger and other
charges		0.30			0.34				1.31		1.24
Amortization of core deposit premium		0.01			--				0.03		0.02
Gain on sale of partnership interest		(0.04)			--				(0.04)		--
Net interest rate swap (profits) losses		--			--				--		0.01
Cash operating earnings* diluted	$	0.27	$		0.34			$	1.30	$	1.27
Net income basic (GAAP)	$	0.30	$		0.35			$	1.30	$	1.27
Cash dividends declared		0.16			0.15				0.61		0.58

(1)  Calculated on a fully taxable equivalent basis using amortized cost.

(2)  These ratios are stated on an annualized basis and are not necessarily indicative of future periods.

(3) The calculations of ROA and ROE do not include the mark-to-market unrealized gains (losses) because the unrealized gains (losses) are not included in net income.

*

The Company believes that cash operating earnings, excluding the impacts of noncash interest rate swap fair value changes, noncash amortization expense and the merger costs related to the Big Lake acquisition which was completed on April 3, 2006, and costs associated with the name change announced for the Company’s primary banking subsidiary, is a better measurement of the Company’s trend in operating earnings growth.  Net cash payments and receipts from the interest rate swap have been immaterial for the periods presented.

FINANCIAL  HIGHLIGHTS	(Unaudited)
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES
(Dollars in thousands, except per share data)			December 31,					Increase/
			2006		2005			(Decrease)
Credit Analysis
Net charge-offs (recoveries) year-to-date		$	(106)	$		134		(179.1)	%
Net charge-offs (recoveries) to
average loans			(0.01)	%		0.01	%	(200.0)
Loan loss provision year-to-date		$	3,285	$		1,317		149.4
Allowance to loans at end of period			0.86	%		0.70	%	22.9
Nonperforming assets		$	12,465	$		372		3,250.8
Nonperforming assets to loans and other
real estate owned at end of period			0.72	%		0.03	%	2,300.0
Selected Financial Data
Total assets		$	2,389,435	$		2,132,174		12.1
Securities – Held for sale (at fair value)			313,983			392,952		(20.1)
Securities – Held for investment (at amortized cost)			129,958			150,072		(13.4)
Net loans			1,718,196			1,280,989		34.1
Deposits			1,891,018			1,784,219		6.0
Shareholders’ equity			212,425			152,720		39.1
Book value per share			11.20			8.94		25.3
Tangible book value per share			8.18			6.95		17.7
Average shareholders' equity
to average assets			8.55	%		7.17	%	19.2
Average Balances (Year-to-Date)
Total assets		$	2,314,864	$		1,937,361		19.5
Less: Intangible assets			51,335			23,573		117.8
Total average tangible assets		$	2,263,529	$		1,913,788		18.3
Total equity		$	197,866	$		138,875		42.5
Less: Intangible assets			51,335			23,573		117.8
Total average tangible equity		$	146,531	$		115,302		27.1

CONDENSED CONSOLIDATED STATEMENTS OF INCOME  (Unaudited)

SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

			Three Months Ended					Twelve Months Ended
			December 31,					December 31,
(Dollars in thousands, except per share data)			2006			2005		2006		2005
Interest on securities:
Taxable	$		5.050		$	5,482	$	21,933	$	21,752
Nontaxable			92			15		298		66
Interest and fees on loans			31,671			21,564		114,388		72,958
Interest on federal funds sold and other investments			334			1,531		3,208		3,624
Total Interest Income			37,147			28,592		139,827		98,400
Interest on deposits			5,642			2,998		19,184		9,095
Interest on time certificates			6,700			3,863		21,886		12,225
Interest on borrowed money			3,024			1,694		9,717		4,895
Total Interest Expense			15,366			8,555		50,787		26,215
Net Interest Income			21,781			20,037		89,040		72,185
Provision for loan losses			2,250			330		3,285		1,317
Net Interest Income After Provision for Loan Losses				19,531		19,707		85,755		70,868
Noninterest income:
Service charges on deposit accounts			1,875			1,327		6,784		5,022
Trust income			654			605		2,858		2,573
Mortgage banking fees			337			290		1,131		1,810
Brokerage commissions and fees			598			627		3,002		2,562
Marine finance fees			570			806		2,709		3,068
Debit card income			565			416		2,149		1,714
Other deposit based EFT fees			114			94		421		417
Merchant income			624			530		2,545		2,230
Interest rate swap losses			--			--		--		(267)
Other income			382			394		1,514		1,388
			5,719			5,089		23,113		20,517
Gain on sale of partnership interest			1,147			--		1,147		--
Securities gains (losses), net			(73)			50		(157)		128
Total Noninterest Income			6,793			5,139		24,103		20,645
Noninterest expenses:
Salaries and wages			6,479			6,730		29,146		23,783
Employee benefits			1,699			1,575		7,322		6,313
Outsourced data processing costs			1,768			1,609		7,443		6,477
Occupancy expense			1,893			1,388		7,435		5,126
Furniture and equipment expense			689			525		2,523		2,121
Marketing expense			1,564			689		4,359		3,194
Legal and professional fees			863			765		2,792		2,595
FDIC assessments			121			56		325		225
Amortization of intangibles			315			119		1,070		533
Other expense			2,782			2,282		10,630		8,733
Total Noninterest Expenses			18,173			15,738		73,045		59,100
Income Before Income Taxes			8,151			9,108		36,813		32,413
Provision for income taxes			2,466			3,275		12,959		11,654
Net Income		$	5,685		$	5,833	$	23,854	$	20,759
Per share common stock:
Net income diluted		$	0.30		$	0.34	$	1.28	$	1.24
Net income basic			0.30			0.35		1.30		1.27
Cash dividends declared			0.16			0.15		0.61		0.58
Average diluted shares outstanding			19,129,452			17,287,715		18,671,752		16,749,386
Average basic shares outstanding			18,787,297			16,883,719		18,305,258		16,361,196

CONDENSED CONSOLIDATED BALANCE SHEETS  (Unaudited)

SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

			December 31,			December 31,
(Dollars in thousands)			2006			2005
Assets
Cash and due from banks		$	89,803		$		67,373
Federal funds sold and other investments			2,412				153,120
Total Cash and Cash Equivalents			92,215				220,493
Securities:
Held for sale (at fair value)			313,983				392,952
Held for investment (at amortized cost)			129,958				150,072
Total Securities			443,941				543,024
Loans available for sale			5,888				2,440
Loans, net of unearned income			1,733,111				1,289,995
Less: Allowance for loan losses			(14,915)				(9,006)
Net Loans			1,718,196				1,280,989
Bank premises and equipment			37,070				22,218
Other real estate owned			--				--
Goodwill and other intangible assets			57,299				33,901
Other assets			34,826				29,109
		$	2,389,435		$		2,132,174
Liabilities and Shareholders’ Equity
Liabilities
Deposits
Demand deposits (noninterest bearing)		$	391,805		$		472,996
Savings deposits			929,444				882,031
Other time deposits			325,251				256,484
Time certificates of $100,000 or more			244,518				172,708
Total Deposits			1,891,018				1,784,219
Federal funds purchased and securities sold under agreements to repurchase, maturing within 30 days				206,476			96,786
Borrowed funds			26,522				45,485
Subordinated debt			41,238				41,238
Other liabilities			11,756				11,726
			2,177,010				1,979,454
Shareholders' Equity
Preferred stock			--				--
Common stock			1,899				1,710
Additional paid in capital			91,561				46,347
Retained earnings			124,811				112,182
Restricted stock awards			(3,181)				(3,447)
Treasury stock			(310)				(218)
			214,780				156,574
Accumulated other comprehensive loss, net			(2,355)				(3,854)
Total Shareholders’ Equity			212,425				152,720
	$		2,389,435		$		2,132,174
Common Shares Outstanding			18,974,295				17,084,315

Note:  The balance sheet at December 31, 2005 has been derived from the audited financial statements at that date.

CONSOLIDATED QUARTERLY FINANCIAL DATA   (Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES
				Quarters
				2006														Last 12
(Dollars in thousands, except per share data)				Fourth					Third			Second		First				Months
Net income (GAAP)	$			5,685		$			5,869	$		6,434	$		5,866	$		23,854
Merger and other charges				--					--			576			--			576
Earnings, excluding merger and other
charges				5,685					5,869			7,010			5,866			24,430
Amortization of core deposit premium				205					205			209			77			696
Gain on sale of partnership interest				(746)					--			--			--			(746)
Cash operating earnings*	$			5,145		$			6,074	$		7,219	$		5,943	$		24,380
Operating Ratios
Return on average assets (GAAP) (2),(3)
Using GAAP earnings				0.95		%			0.99	%		1.07	%		1.13	%		1.03	%
Using cash operating earnings* on average tangible assets					0.88				1.05			1.23			1.16			1.08
Return on average shareholders' equity (GAAP) (2),(3)
Using GAAP earnings					10.57				11.03			12.43			14.98			12.06
Using cash operating earnings* on average tangible equity					12.99				15.64			19.39			19.25			16.64
Net interest margin (1),(2)				3.95					4.22			4.29			4.16			4.15
Average equity to average assets				8.99					8.98			8.58			7.52			8.55
Credit Analysis
Net charge-offs (recoveries)	$			27			$		23		$	(76)			(80)		$	(106)
Net charge-offs (recoveries) to average loans				0.01		%			0.01	%		(0.02)	%		(0.02)	%		(0.01)	%
Loan loss provision	$			2,250		$			475	$		280	$		280	$		3,285
Allowance to loans at end of period				0.86		%			0.77	%		0.76	%		0.70	%
Nonperforming assets	$			12,465		$			10,437	$		588	$		240
Nonperforming assets to loans and other real estate owned at end of period			0.72			%			0.63	%		0.04	%		0.02	%
Nonaccrual loans and accruing loans 90 days or more past due to loans outstanding at end of period			0.72						0.71			0.03			0.02
Per Share Common Stock
Net income diluted (GAAP)		$		0.30		$			0.31	$		0.34	$		0.34	$		1.28
Merger and other charges				--					--			0.03			--			0.03
Earnings, excluding merger and other
charges				0.30					0.31			0.37			0.34			1.31
Amortization of core deposit premium				0.01					0.01			0.01			--			0.03
Gain on sale of partnership interest				(0.04)					--			--			--			(0.04)
Cash operating earnings* diluted		$		0.27				$	0.32	$		0.38	$		0.34	$		1.30
Net income basic (GAAP)		$		0.30		$			0.31	$		0.34	$		0.35	$		1.30
Cash dividends declared				0.16					0.15			0.15			0.15			0.61
Book value per share				11.20					10.99			10.70			9.09
Average Balances
Total assets		$		2,372,784		$			2,350,862	$		2,419,683	$		2,112,876
Less: Intangible assets				56,230					56,945			58,252			33,604
Total average tangible assets		$		2,316,554		$			2,293,917	$		2,361,431	$		2,079,272
Total equity		$		213,354		$			211,024	$		207,555	$		158,787
Intangible assets				56,230					56,945			58,252			33,604
Total average tangible equity	$			157,124		$			154,079	$		149,303	$		125,183

 (1) Calculated on a fully taxable equivalent basis using amortized cost.

(2) These ratios are stated on an annualized basis and are not necessarily indicative of future periods.

(3) The calculations of ROA and ROE do not include the mark-to-market unrealized gains (losses), because the unrealized gains (losses) are not included in net income.

*

The Company believes that cash operating earnings, excluding the impacts of noncash interest rate swap fair value changes, noncash amortization expense and the merger costs related to the Big Lake acquisition which was completed on April 3, 2006, and costs associated with the name changes announced for the Company’s primary banking subsidiary, is a better measurement of the Company’s trend in operating earnings growth.  Net cash payments and receipts from the interest rate swap have been immaterial for the periods presented.

CONSOLIDATED QUARTERLY FINANCIAL DATA   (Unaudited) (continued)

SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

(Dollars in thousands)

SECURITIES		December 31, 2006			December 31, 2005
U.S. Treasury and U.S. Government Agencies	$		94,676	$		71,189
Mortgage-backed			214,661			319,906
Obligations of states and political subdivisions			2,049			--
Other securities			2,597			1,857
Securities Held for Sale			313,983			392,952
U.S. Treasury and U. S. Government Agencies			--			5,000
Mortgage-backed			123,587			143,877
Obligations of states and political subdivisions			6,371			1,195
Securities Held for Investment			129,958			150,072
Total Securities	$		443,941	$		543,024
LOANS		December 31, 2006			December 31, 2005
Construction and land development	$		571,133	$		427,216
Real estate mortgage			949,824			680,877
Installment loans to individuals			83,428			82,942
Commercial and financial			128,101			98,653
Other loans			625			307
Total Loans	$		1,733,111	$		1,289,995

AVERAGE BALANCES, YIELDS AND RATES (1) (Unaudited)

SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

		2006								2005
		Fourth Quarter		Third Quarter						Fourth Quarter
		Average	Yield/			Average	Yield/			Average		Yield/
(Dollars in thousands)		Balance	Rate			Balance	Rate			Balance	Rate
Assets
Earning assets:
Securities:
Taxable	$	462,628	4.37	%	$	493,810	4.35	%	$	567,382	3.86		%
Nontaxable		8,409	6.47			8,654	6.61			1,196	7.69
Total Securities		471,037	4.40			502,464	4.39			568,578	3.87
Federal funds sold and other
investments		24,872	5.33			38,832	5.32			154,144	3.94
Loans, net		1,698,552	7.40			1,634,263	7.47			1,249,461	6.85
Total Earning Assets		2,194,461	6.73			2,175,559	6.71			1,972,183	5.76
Allowance for loan losses		(12,842)				(12,363)				(8,800)
Cash and due from banks		76,523				74,680				70,150
Premises and equipment		36,731				37,162				21,674
Other assets		77,911				75,824				48,771
	$	2,372,784		$		2,350,862		$		2,103,978
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
NOW	$	198,610	2.10	%	$	208,948	1.72	%	$	137,457	0.89		%
Savings deposits		136,410	0.71			149,323	0.69			152,807	0.51
Money market accounts		591,740	2.92			603,133	2.76			589,275	1.68
Time deposits		581,520	4.57			552,589	4.23			449,657	3.41
Federal funds purchased and other short term borrowings		154,065	4.68			107,401	4.42			94,719	3.25
Other borrowings		67,798	7.06			67,572	7.14			72,504	5.02
Total Interest-Bearing Liabilities		1,730,143	3.52			1,688,966	3.21			1,496,419	2.27
Demand deposits (noninterest-bearing)		415,791				439,379				442,534
Other liabilities		13,496				11,493				10,344
Total Liabilities		2,159,430				2,139,838				1,949,297
Shareholders' equity		213,354				211,024				154,681
	$	2,372,784		$		2,350,862		$		2,103,978
Interest expense as a % of earning assets			2.78	%			2.49	%			1.72		%
Net interest income as a % of earning assets			3.95				4.22				4.04

(1)

 On a fully taxable equivalent basis.  All yields and rates have been computed on an annualized basis using amortized cost.  Fees on loans have been included in interest on loans.  Nonaccrual loans are included in loan balances.

EX-99.2

EXHIBIT 99.2

To 8-K dated January 25, 2007

Seacoast Banking Corporation of Florida

Fourth Quarter Earnings Release Conference Call

January 26, 2007

9:00 a.m. Eastern Time

Operator:

Good morning ladies and gentlemen and welcome to the Fourth Quarter Earnings Release Conference Call.  At this time all participants are in a listen-only mode.  Later we will conduct a question and answer session.  Please note that this conference is being recorded.  I will now turn the call over to Mr. Dennis Hudson.  Mr. Hudson, you may begin.

Dennis Hudson:

Thank you very much and welcome to our Seacoast’s Fourth Quarter 2006 Earnings Conference Call.  Before we begin, I’d like to direct your attention once again to the statement contained at the end of our press release regarding forward statements.  During the call we’re going to be discussing certain issues that constitute forward-looking statements within the meaning of the Securities and Exchange Act, and accordingly our comments are intended to be covered within the meaning of Section 27A of the Act.  We have also posted a few slides on our website that we are all going to be referring to in our comments.  Feel free to visit www.seacoastbanking.net and click on Presentations at the bottom of the Investor Relations listing to view these slides as we continue with our comm ents.  With me today is Bill Hahl, our Chief Financial Officer; as well as Doug Gilbert, our Vice Chairman and Chief Credit Officer; and Jean Strickland, our Chief Operating Officer.  All of us will be available to answer questions following our prepared remarks.

Seacoast reported earnings of $23.9 million or $1.28 diluted earnings per share for 2006.  This represents a modest 3% growth in earnings over the record 30% growth posted in the prior year. For the quarter, earnings totaled $5.7 million or $0.30 per share. Earnings for the quarter after adjusting for a significant increase in the provision for loan losses this quarter and a gain associated with the sale of one of our branch properties was $0.33, up over the $0.30 earned in the prior quarter.  

During the quarter, we completed a review of all large credits with any exposure to the slowing housing market. This review was undertaken as part of our credit monitoring process in response to what we believe is a change in market conditions. Timely monitoring of credit exposure in response to changing market conditions is an important element of our credit processes.  While we did not identify any specific loss exposure, we did increase our provision for loan losses this quarter in response to the change in market condition.  During the quarter, we also increased an impairment reserve related to the non-performing loan added in the previous quarter. Each of these factors, the provision related to market conditions and the provision related to the non-performing loan, contributed approximately half of the total provision of $ 2.2 million for the quarter. Going forward we expect our provisioning to be more closely aligned with loan growth.  

While earnings growth was quite strong through the first half of 2006, a persistently inverted yield curve, together with deposit balance declines resulting from the slowing residential real estate market and from an intensely competitive marketplace, took its toll in the second half of the year. These factors will likely continue to persist, although at a slowing rate into early 2007.  

Loan growth remained strong throughout 2006 with loan balances up 18.6% annualized for the fourth quarter on a sequential basis.  This growth rate mirrored our organic growth rate for the year.  Loan growth actually helped improve our net interest margin for the full year, which increased 18 basis points to 4.14%.  We expect loan growth rates to moderate as we move into 2007 due to an expected higher level of loan pay-offs.  We will continue to target strong production, particularly in non-residential commercial lending during the year; and we believe this will result in loan growth going forward in the high single digits.  

During the quarter, the sale of two of our largest local Treasure Coast competitors was completed. This will mark the initial entry into Florida by the buyer, National City Corporation headquartered in Cleveland, Ohio.  Re-branding and systems conversions will be accomplished late in the first quarter for one of the companies and earlier in the second quarter for the other.  Announcements regarding personnel issues have already begun to occur and we’ve had a few early successes in our efforts to attract lending personnel.  We have created both an external marketing campaign and an internal sales campaign that is designed to help us take advantage of any potential customer disruption.

I’d like you now to turn to slide number 3 in our presentation and that can be found on our website, seacoastbanking.net.  In slide 3, which is entitled “Capitalizing On Market Disruption”, you can see that here in our core Treasure Coast market, over $1.5 billion in deposits that were held by two local community banks will now be transferred to National City. This represents a major change here in the Treasure Coast region where we have the most offices of any region that we operate in.  We think the opportunities for us are outstanding and will begin to materialize probably late in the first quarter and into the second quarter and throughout the year.

If you turn to slide 4, page 4, you can see the complete list of remaining community banks located here in this Treasure Coast market area; and there can be no doubt that Seacoast, at the top of the list, represents the most competitive offering in terms of remaining community banks on the Treasure Coast, both in number of offices and the scale of our size throughout the market in terms of our deposits.  So we are excited about the prospects for continued solid loan growth and the National City opportunity that is now upon us.  As you know, other factors, however, are testing the growth of our net interest margin and these factors are likely to continue to be a challenge for us.  Our projection suggests a continuation of these factors will make it difficult to accomplish meaningful improvements and overall earnings growth until later in the year.

Now I’d like to turn the call over to Bill, who is going to add a few other comments about the quarter.  Bill…

William Hahl:

Thanks Denny. There are some areas where I believe we can provide a bit more detail about the quarter and where we are headed in 2007.  The areas I’m going to cover are:  the margin, non-interest income, non-interest expense and the tax provision.

The net interest margin compression for the quarter totaled 27 basis points as a result of a difficult environment and a continuing deposit competition; as well as, we had some change in funding as a result of deposit declines, which were partially offset by deposits and repurchase agreements from public fund customers.  Because of the projected pay downs that we have for our real estate projects which we forecast in the first quarter of 2007, we elected to borrow funds overnight rather than paying up for time deposits this quarter; therefore, we allowed the sequential net deposit declines to occur.  The seasonal deposits and repurchase balances from public fund customers accounted for approximately five basis points of the fourth quarter’s margin decline due to very narrow spreads earned on those funds.  Deposit pric ing increases accounted for another 13 basis points of margin compression.  Overnight borrowing, which replaced declines in non-interest bearing and savings deposits accounted for 11 basis points of the reduced margin.  

On a positive side, earning assets yield improved two basis points during the quarter and we expect further improvement in 2007 in those yields as a result of very good loan growth with average loans as a percent of earning assets increasing to 77% from 75% in the third quarter.  Loan growth totaled 4.6% link quarter un-annualized.  

As discussed in last quarter’s conference call, we expected this margin compression as a result of the inverted yield curve and from maturing CDs pricing to higher rates due to a very competitive deposit environment. It appears we can again expect the pressure on the margin going into 2007 through the first quarter, however we believe that it will be about half that which we experienced here in the fourth quarter.  We believe modest improvement in the margin will begin as early as the second quarter, assuming loan goals are achieved and there is s no significant change in interest rates or the current economic environment.  We believe loan growth, as Denny mentioned, will slow from our 2006 organic growth rate of 19% for 2006 to an 8% to 10% range for 2007.  

Now a few comments on non-interest income:  We expected, and talked about at last quarter, non-interest items improving in the fourth quarter, and indeed marine fees and mortgage banking fees did increase from the third quarter.  On a year-over-year basis, fees from Wealth Management line of business improved by 14%, and we expect similar increases consistent with our long-term goals for a solid 10% growth in this line of business in the future.  Overall we expect further improvement in fee generation will occur in 2007 as a result of our acquisitions in the last two years and as we are in successful in acquiring customers from the National City opportunity.  But as Denny mentioned, probably that growth won’t emerge until later in the year.

Turning to non-interest expenses, the current quarter and the last six months have been a challenge for our company and the industry as a whole.  Our earnings results have not met our expectations and therefore in the fourth quarter we adjusted our salary incentives and profit-sharing contributions for the year 2006, all occurring in the fourth quarter.  These adjustments resulted in lowering non-interest expenses in the fourth quarter by $1,341,000 or said a different way; they added $0.03 per share to fourth quarter results.  

We indicated last quarter we were assessing our overall cost structure and would have guidance on expected overhead for 2007.  We will begin implementing identified cost savings starting in the first quarter and throughout the remainder of the year, with the goal of achieving no meaningful overhead growth for the full year 2007 compared to 2006 after adjusting for the added expenses of a full year impact of the Big Lake acquisition.  I believe the reference point for the quarterly run rate with Big Lake for expenses in 2007 is the third quarter results of 2006.  This overhead was after the impact of the integration and the elimination of duplicate backroom costs.  Our goal is to achieve quarterly expense results in 2007, similar to that of third quarter 2006 with increases each quarter for cost adds resulting from the addition of three branches and a loan production office, which will occur as the year progresses. This will achieve an overhead rate that will range in the mid 60s for the first half of 2007 to the low 60s in the last half, provided revenue growth occurs as expected in the last half of 2007.  

Finally I’ll mention that the tax provision for the quarter was at a lower rate, as a result of tax benefits from cashless stock options exercises which occurred in the quarter and some normal annual true-up of our tax accruals at year-end.  

Dennis Hudson:

Thank you Bill.  We will now open the call for questions.  

Operator:

Thank you.  We will now begin the question and answer session.  If you do have a question, please press star then one on your touchtone phone. If you wish to be removed from the queue, please press the pound sign or the hash key. If you are using a speakerphone, you may need to pickup your handset first before pressing the numbers. Once again, if there are any questions, please press star then one on your touchtone phone.

Our first question comes from Barry McCarver from Stephens Inc.; please state your question.

Barry McCarver:

Hi. Good morning guys.  

Dennis Hudson:

Good morning.

William Hahl:

Morning Barry.  

Barry McCarver:

I’m curious; I guess a little more color on the margin.  In your assumptions about this later in the year, is that primarily a function of what’s happening on the funding side or are you expecting any changes in terms of pricing on the loan side?

William Hahl:

I think it’s partly on the funding side.  We believe, with the Fed being on hold and the CDs being relatively short, Barry, that we will see less and less impact coming from CD re-pricing opportunities there; and then with loan growth, the pick up in the margin there kind of begins to offset. It’s somewhat of an optimistic forecast for earnings or margin expansion of any major amount, but we do see once we get through the first quarter that there is that opportunity for more of a flat to slightly improving margin.

Barry McCarver:

Okay.

Dennis Hudson:

Said another way, we pretty well work through all of our adjustments in the first quarter.

Barry McCarver:

Okay.  And then secondly, in regards to the opportunities from the recent mergers of a couple of your competitors, have you kind of baked into these expense numbers the potential for possibly picking up some good people? Is that, should we consider that baked into your comments regarding expenses in ’07?

Dennis Hudson:

And I guess the answer is, some of that is there, and depends on how successful we are in picking up some of the people.  I would say that also though that any people we pick up would be with the intention of having it help improve our revenue growth, so they’re going to largely pay for themselves; and if we couldn’t see that, I’m not sure that we’d want to move in that direction.  We’ve done a fair amount of work on the cost side and that’ll become effective and work its way in as those opportunities present themselves.  So we have baked a certain amount of that in, yeah.

Barry McCarver:

Okay.  And then just lastly, Denny, we’ve seen a lot, seems like this earnings period, we’ve heard from a lot of Florida banks about asset quality, particularly on the residential construction side.  I’m just wondering if you could give us a little color on what you might be seeing out there and if there’s anything that you’re seeing from your competitors that might be worth talking about?

Dennis Hudson:

I’m sure Doug will want to comment on that. I mean, just generally, to clarify and reiterate, this quarter, in our own portfolio, we undertook a very rigorous review of all large loans that were in anyway related to that market.  We got through that and feel pretty comfortable with our current position.  The results of that review did not reveal, as I said earlier, any areas of significant concern.  But we were able to…it helped allow us to really focus on credits that might in the future begin to experience some concerns; and so now is the time to be talking about that with borrowers and make sure that they’re taking the appropriate action in their own businesses to respond to what is very clearly a slowing of residential transactions.  

Doug, any further comments on an overall view?

A. Douglas Gilbert:

Well, I don’t think there’s any question about the fact that market conditions have changed rather significantly over a fairly short period of time; and we are, of course, not totally insulated from that, although our markets tend to be the last affected because of the growth rates in our markets.  But, as Denny said, we have gone over every single significant loan in the portfolio and have not identified any true problems.  We have identified projects that may be a little slower in getting out of the ground and selling out, but as far as identifying any real problems, we haven’t done that.  And this quickly, the commercial side, commercial real estate side seems to be still, amazingly, relatively strong; and at this juncture, it hasn’t had the effect that it has had on the residential markets to date.  

Dennis Hudson:

And you also asked, Barry, about what we see at our competitors.  We read the same things you do, I guess, and there have been kind of spotty results in terms of unusual problems here and there.  But again, I just want to characterize what we did this quarter is something that is just part of our normal ongoing credit monitoring and that it is a very important part of our whole credit process:  that is to stay on top of these and understand exactly where the borrowers are at any given point and time.  And I think it is absolutely an appropriate thing to do given what we see in the marketplace, that is a significant slowing in transaction volumes that will probably be with us for quite some time.  

Berry McCarver:

Very good guys.  I know it’s a very difficult environment right now in market and I appreciate the additional transparency and hard work. Thanks a lot.

Dennis Hudson:

Thank you.

Operator:

Our next question comes from David Bishop with Stifel Nicolaus; please state your question.

David Bishop:

Thank you. Hey, good morning gentlemen.

Dennis Hudson:

Morning David.

William Hahl:

Morning.

David Bishop:

Question for you:  I think in your preamble you talked about the breakdown in terms of the distribution of the loan loss provision.  You said half was due to, I guess, the new exposure on the boat loans. How about the other half there in terms of what that was related to?

Dennis Hudson:

Half was related to an increase, as you said earlier, in an impairment reserve on the amount of the accrual loan that we put on non-accrual last quarter--roughly half of the $2.2 million. The other half, what I was attempting to say, was related to just a change in market conditions that is effecting parts of the portfolio related to residential construction.  And again, just to be clear, we did not identify any losses or other impairments in that portfolio.  We just think it was a prudent time to increase the size of the reserve due to what we saw as a change in market condition.  

David Bishop:

How about in terms of just internal risk ratings on loans--any sort of degradation there, or material sub or watch list trends that aren’t showing up in the NPAs, or early watch list delinquencies?

Dennis Hudson:

Well, that’s not something that we publish, but suffice it to say that we looked very carefully as we completed that review and made sure that we felt comfortable with the risk ratings on all of the credits in the portfolio as part of our overall ongoing monitoring of credit through time.  We certainly took, I think, what all of us would agree is a conservative, very conservative, review of the portfolio given the conditions that currently exist.  But again, that’s not something we’ve typically publish.

David Bishop:

A question from sort of an ALCO perspective.  I did note the increase, I guess, in rate sensitive assets there.  Is that a function of that short-term liquidity coming on the books?  I seem to recall you guys were extending durations, I thought, on the asset side there to maybe better position the bank if the Fed does go neutral.  Any sort of shift in terms of your interest rate sensitivity on a significant basis quarter-to-quarter?

William Hahl:

No David, no real change.  

David Bishop:

And then finally I guess, quick question…I lost my train of thought here.  I’ll jump back on with another question.

Dennis Hudson:

Thank you David.

Operator:

Our next question comes from Jennifer Thompson from Oppenheimer; please state your question.

Jennifer Thompson:

Hi. Good morning everyone.  

Male Speaker:

Good Morning.

Male Speaker:

Morning Jen.

Jennifer Thompson:

A couple of questions on your guidance as well.  You mentioned you are expecting loan growth to run 8% to 10%. Is there anything we should be adjusting in our earning asset outlook regarding securities or would you expect earning asset growth to approximate loan growth?

William Hahl:

Well I guess, Jen, it should be a continuation on the securities portfolio of the run off that we’ve been seeing, so I wouldn’t think that our earning asset growth rate would be as high as the loan growth (inaudible)…

(Cross talk)

Dennis Hudson:

I think the answer is there will be some earning asset growth with that kind of loan growth.  When you look at our liquidity levels right now, that is clearly something that you’ll see is earning asset growth, but it’s not necessarily to be at the same rate as loan growth.

Jennifer Thompson:

Okay.  I’m sorry again for…

Dennis Hudson:

And I would say that’s a change from this past quarter where you did not see earning asset growth.

Jennifer Thompson:

Right.  Okay. So that’s helpful.  I apologize for asking this again, I sort of missed the question earlier regarding the provision outlook.  Now the $2.3 million, the outlook going forward you said you would expect to see that provision grow in line with loan growth with sort of a core number being what the net charge-off ratio was this quarter, or would you say it’s half of what your provision was in the fourth quarter?

Dennis Hudson:

No, our provisioning going forward, what we were trying to say, will be more of a function of growth in the loan portfolio, and so we would anticipate the provisioning going forward to be substantially less than it was this quarter and more in line with perhaps what we have seen prior to this quarter in terms of overall provisioning. That very simply said:  the drivers to the provision going forward are more likely to be loan growth, not other factors.  So if we saw…I think that’s pretty clear.

Jennifer Thompson:

Great. Thanks very much.

Dennis Hudson:

Sure.

Operator:

We have Christopher Marinac from Fig Partners; please state your question.  

Dennis Hudson:

Morning Chris.

Christopher Marinac:

Hey Denny. Sorry, I had my mute button on.  Can you talk to us about the change in real estate values, I guess, across various portions of the commercial and residential real estate market, both in recent quarters as well as kind of what you expect might be a downside risk during the course of this year?

Dennis Hudson:

Yeah, that’s a good question and first of all, as Doug said earlier, on the non-residential side, on the commercial side of the real estate market, I don’t know, Doug, that we’ve seen anywhere where there has been weakness.

A. Douglas Gilbert:

…Little if any weakness in the commercial side.  And I would say to you that on the residential side, the decline that we’ve seen in value depends on what part of our market you’re really looking at, there are parts of our market where there has been no decline.  But if you look at from an overall standpoint, you would say a 5% to 10% basic decline in values.  It’s our feeling and our thought that that is probably as far as it’s going to go.  Considering the limited supply and the number of people moving into the area, we don’t think it will go much farther than what we’ve seen to date.  

Dennis Hudson:

But it’s going to probably be spotty, and I think that’s what Doug was trying to say:  there could be certain areas or projects that would experience more difficultly than others.  Interestingly, if you just look at transactions generally throughout the market and compare it with the past year or so you’re really haven’t seen much in the way of decline.  I mean there’s certainly evidence, as Doug just said, of some modest decline in values, but we have not seen, except in spotty unusual sort of situations, any substantial decline in value at this point--and I’m talking residential product.  

Christopher Marinac:

Would the same hold true for straight raw land as with an A&D loan?

Dennis Hudson:

That’s going to be far more difficult to project. There is no doubt about it that you would expect that raw land values would decline at a greater rate.  But there haven’t been a lot of transactions yet.  You are just starting to read about some of that and, again, if we have proper underwriting on the front end of that stuff, we are not likely to see any substantial problems.

Christopher Marinac:

Great.  And then the follow-up was just any color short-term that may be on your big new green competitor in town?

Dennis Hudson:

Well, it’s kind of interesting, it’s beginning to happen just now.  As you know, both transactions closed; one late last year and one very early this year.  They have now established very firm conversion dates. For one of our competitors here that will be mid March and the other one will occur three weeks later, we think.  We have confirmed that on those dates they will simultaneously re-flag the place, lay-off several hundred folks and change all of the systems, so it’s going to be a very significant change internally to those organizations. They have already begun making very clear decisions on personnel and that caused us to talk with a number of folks, which has been positive.  So the signs are encouraging thus far.  

Christopher Marinac:

Great. Thank you very much guys.

Dennis Hudson:

Thanks.

Operator:

We have John Pandtle from Raymond James; please state your question.

John Pandtle:

Thank you and good morning.

Dennis Hudson:

Morning.

John Pandtle:

I wanted to go back to the securities portfolio issue, which really seems to have been a meaningful hindrance on net interest income growth over the past year.  As I look at your securities portfolio, it’s about 22.5% of average earning assets in the fourth quarter, roughly 30% in the second quarter and 37% a year ago.  Bill, I’m just kind of wondering, where do you see that number stabilizing as a percent of earning assets as you look into ’07?

William Hahl:

Well I think it’s probably there.  We are going to be comfortable at a level of around 20% or so of earning assets.  We do have quite a bit of run-off occurring this year.  It’s going be higher.  We have some bullet agencies that come off this year, fairly large sized, about split between each half of the year; so we’ll be assessing, as the interest rate environment unfolds throughout the year, what we’ll be doing with the investments in the investment portfolio.  Whether we will be adding duration would be the key question.  So at this point we haven’t wanted…didn’t want to go out any further on the curve because it wasn’t beneficial.  So I think, to answer your question though, over the long-term, we are looking at around probably 20%.  But this year it cou ld be different than that, just because of the fact that we may want to stay short, may want to stay in overnight funds as these other additional funds become available, if there are excess above what is needed for loan growth.

John Pandtle:

So different means lower than 20%?

William Hahl:

I don’t think it will go lower than 20%.

Dennis Hudson:

I think we’re about there, but…  It really depends on how successful we are on the deposit side.

John Pandtle:

Yeah, I mean that seems to the lynch pin of this whole equation.

Dennis Hudson:

No doubt about it, and it has been the negative factor that’s worked its way in the second half.  Another factor that is affecting us, I think more than one might have expected, has being the slowing transactions in real estate. Those drove some of the deposit growth we had over the past year probably, and a lot of that has already unwound.  That is why we say some of those factors are going to moderate now, because we think we are pretty well through that when we looked in our studies at the account level and saw what has really happened to us.  So that’s been a big drag for us, and yet the marketplace has been competitive and the yield curve has been inverted, and so it has been very difficult for us to make any sense out of going back into the market and boosting that growth rate back at ever smaller margins.  So, we have just kind of hung tight as that has occurred. The other factor that has affected us in the last two quarters has been some deposit decline related to the Big Lake acquisition that occurred, I think, in April of this year.  We are now kind of through what was a fairly modest decline in deposits--some of it driven by competition for public funds.  They had a fairly high exposure of public funds in many of the markets that they’re operating in, which we understood from the beginning, and the environment turned very negative and became kind of nonsensical for us to compete at the levels that we saw out there.  So we intentionally saw some deposit outflow occur out of that, and that kind of hit us at the same time these factors materialized.  So the question is:  Are we kind of pretty well through that?  We think we are, although we think there’ll be some more, some additional effect in the first quarter, and that’s why I said at the outset, we’r e going to be challenged to show any kind of meaningful earnings growth until later in the year.  We’ve got to get through those factors that are affecting us.

John Pandtle:

Denny, and if I could, on a follow-up on a separate topic, when you went through your review of the credits that are related to residential construction, when you calculated the provision or reserve build you would need, what were some of the factors that you consider?  Do issues such as new home sales, home prices, absorption rates…how does that all factor in?  What are the key metrics that you look at when you come up with that kind of reserve, and specifically what is your outlook on some of those metrics?

Dennis Hudson:

Well that’s a great question, and it would take about an hour to answer it and at the end of the hour we’d probably still wouldn’t understand it.  I guess the only thing I would say is that there are a number of subjective factors that need to be considered in making that decision.  What we do is go out and read the marketplace and come up with rationale for either increasing or decreasing those subjective factors.  We were able to develop what we felt was pretty solid support, objective support in the marketplace for increasing some of the more subjective factors behind the allowance, and that’s what we did.  And some of the objective data we looked at was declining numbers of transaction occurring.  We looked at inventory build throughout the markets, which has been evident in the past coupl e of quarters, and other such things, and came to the conclusion that it was appropriate for us to book a higher provision.

John Pandtle:

Thanks for your thoughts.

Dennis Hudson:

Sure.  

Operator:

Our next question comes from Gary Tenner from Sun Trust Robinson.

Gary Tenner:

Good morning.

Dennis Hudson:

Morning.  

Gary Tenner:

Just a question for you with ’07 laying out as probably a pretty modest balance sheet growth year, in your build-up in your capital ratio and your stock where it is, how are you viewing the use of capital in terms of a buy-back potentially over the next year?

Dennis Hudson:

First of all, I just want to kind of make clear that we’re not…we kind of agree with you in terms of modest earning asset growth and modest balance sheet growth. I think we have been pretty clear in where we see loan growth. We have been clear some of the challenges on the deposit side, which would cause you to make the statement that you just made.  But also I want to say that we have not baked into our assumptions and our guidance much in the way of any upside related to market disruption here locally in the markets here, and that could be something that could be helpful for us later in the year.  But we have tried not to bake that assumption into anything we have told you and talked about.  We have tried to be very realistic about where we see us heading.  And we are going to work really hard to take adva ntage of what could be a short-term opportunity for us here over the next year or two with the potential for market disruption. There can be no doubt that the pressure on capital has lessened beginning in the middle of this past year, and that will probably continue to be that situation short-term here over the next 12 months.  So we certainly have the opportunity from a capital standpoint to consider redeploying that with buybacks. It is not something we’re talking about. It is not something we are announcing or anything, but it’s something we will certainly keep our eye on, particularly over the next few months.  

Gary Tenner:

So it sounds like your preference is to keep that excess capital as dry powder for some maybe better than expected balance sheet growth?

Dennis Hudson:

Yes, but I think we’re also mindful of other opportunities out there and one of those could be a buyback.  We are not saying one way or the other, Gary.  It is on the table, and it’s something for us to look at, but nothing to say at this point.  

Gary Tenner:

All right, thank you.

Operator:

Our next question comes from David Johnston from Hovde Financial; please state your question.

David Johnston:

Hey good morning guys.  Just a couple quick questions on the asset side of your balance sheet. First of all, I think you said high single digits for loan growth in 2007.  Is that correct?

Dennis Hudson:

Yes.

David Johnston:

Would you expect that to come sort of be distributed evenly over your different loan categories or do you expect one to sort of be the driver of that growth or a drag on it?

Dennis Hudson:

I think…  Well, Doug, do you want to answer that?

A. Douglas Gilbert:

Because the market is real estate, real estate, and most of it will come from the commercial side, that’s what we see today.

David Johnston:

That’s fair.

Dennis Hudson:

Commercial and probably very little from the residential.  

David Johnston:

Sounds fair.  Just one more quick question regarding the construction bucket in your loan portfolio, have you seen any kind of movement in the ratio of loans outstanding, i.e. money you’ve already distributed to commitments, or does that just sort of remain stable over the last quarter or so?

Dennis Hudson:

What we actually had was some surprising growth, I guess, in that area a little bit this last quarter.  But, again, as we said at the outset, we see substantial payoffs beginning to materialize throughout this year, and it should be no surprise to anybody that those payoffs are going to come largely in that construction portfolio.  So we expect that the mix to come down pretty substantially throughout the year on the construction side.  Again, the press is on for us to make sure that we focus our growth going forward on the commercial end and we’ll do that, so we will see some growth, some add-on volume on the commercial end of construction, but we’re going to see substantial payoffs offset that with residential related construction.  

David Johnston:

Thanks very much.

Operator:

Once again, if there are any questions, please press star then one on your touchtone phone.

Our next question comes from Al Savastano.

Dennis Hudson:

Savastano.

Operator:

I’m sorry, from Janney Montgomery Scott; please state your question.

Al Savastano:

Thank you Denny.  How you guys doing?  

Dennis Hudson:

Great.

Al Savastano:

Just two questions.

Dennis Hudson:

Well, we have been better.

Al Savastano:

Yeah, I think we all have.  Little clarity on your tax rate going forward:  Do you still expect it to return to 36% or will it drop?

William Hahl:

I would say a lower level of earnings than we have.  Our REIT is sheltering a bit more on the state tax, so it’s going to be between 35% and 36%.  It’s going to be at a little bit lower than it has been.  

Al Savastano:

Great. And then, Denny, I was wondering if you can go over how the board assesses whether to remain independent or not?

Dennis Hudson:

We are constantly looking at our forward momentum and our forward prospects.  We operate in some of the highest growth markets in the United States.  We have a significant franchise within those markets.  The long-term prospects are unchanged. They’re extremely positive. We are currently in a challenging environment. I view that environment to be short-term. It would be easy for us to sit here and dumbly straight-line what we have produced over the last couple of quarters and conclude something very negative, but we see very positive prospects for us out into the future. The key for the board to consider is our ability to execute, which is a function of people and having the right folks able to execute.  We have a very optimistic outlook with regard to that and we will continue to look at that.  But to the e xtent that we’re unable to execute properly, that’s always on the table, and we must earn our right to stay independent as every day goes by, so it’s something we’re constantly looking at.  But, again, I think it would be a mistake for us all to view two quarters or so of disappointment as something other than a very difficult environment that we now find ourselves in, and I think it would be… So I guess that probably answers the question.  

Al Savastano:

Thank you very much.  Appreciate it.

Dennis Hudson:

Sure.

Operator:

We have David Bishop from Stifel Nicolaus; please state your question.

David Bishop:

Hey Denny, a couple of follow-ups here.  In terms of the inflow of that public fund money, I think you stated that it was about a five basis point drag to the margin.  What is the timing of the disbursement of those funds as it’s distributed out over the first half of the year, first quarter?

William Hahl:

Generally, David, they hang around through March and then we begin to see those disbursed out.  

David Bishop:

Secondly, I don’t think I saw this disclosed…I don’t know if there’s any commentary on the commercial loan pipeline, besides that I think you entered or exited third quarter at about $370 million. I don’t know if you have that number, if that’s something you disclose for fourth quarter?

William Hahl:

No, we don’t have… I’m not aware of the pipeline numbers for the fourth quarter.

Dennis Hudson:

In general, the pipeline remains strong. It hasn’t improved. It has not improved over the numbers that we talked about in the third quarter, so it’s generally unchanged.  We have had strong pipelines and continue to see things kind of unchanged.  Obviously greater pieces of it are coming from more on the commercial side.  And as Doug said earlier, we have had a remarkably strong steady environment on the commercial side and that continues to be with us today.

David Bishop:

But from the Big Lake point of view, I think you talked about some of the deposit…

Dennis Hudson:

Can you speak up?

David Bishop:

Yeah, in terms of the loan side of Big Lake, what are you seeing from that geographic region, that side of the business?

Dennis Hudson:

Loan growth in Big Lake…

A. Douglas Gilbert:

We’re seeing basically the same thing that they’ve had for the last two or three quarters, not a big pipeline, but a steady pipeline.  

Dennis Hudson:

Kind of at expectation and, again, we feel comfortable with, as Bill said earlier, high single-digit overall loan growth this year.

David Bishop:

Great. Thank you.

Dennis Hudson:

Yep.

Operator:

Our next question comes from Edward Barr from E S Barr & Company; please state your question.

Edward Barr:

Good morning. I had two questions.  Since the National City acquisition has been known for quite some time, have you had any tangible success in the interim or is this still all projected?  And then the second question deals with credit quality, which was described as spotty by market since you have significantly different dollars in each market. Could you give us a sense of the asset quality or the declines by market?

Dennis Hudson:

With regard to the first question, yes, we’ve had some tangible results just in the last month or so as a result of intensified calling efforts by our folks to the customer-base and we’ve had some early successes.  But it is far too soon to say that it’s a trend, and they are a great organization and I’m sure they’re going to do a great, best job they can.  We are just trying to indicate that we think it’s an opportunity for us going forward.  But, again, we have not baked that into any of our overall guidance that we’ve talked about.  It’s just a fact.  But, yes, we’ve had some good success on an individual customer basis, and then some on the personnel side of things.  

Your second question on credit quality: I don’t think we said that it was spotty by market.  I don’t know that what we said was intended to suggest that we have markets where we have particular concern.  I think it’s more spotty by project, down at kind of granular level.  Doug, I couldn’t say there has been any significant difference around markets….just kind of a general slowing.

A. Douglas Gilbert:

Correct.  The comment about the spottiness had to do with the depreciation and that question, as opposed to the asset quality.  I had said that there were spots within our market where there’s been no depreciation.  It had nothing to do with the asset quality.  Denny answered that correctly:  that you can’t identify one market where there is any significant downturn in quality.

Edward Barr:

Thank you.

Dennis Hudson:

Right.  Just in general, the residential real estate market is a very diverse market, and as you can well image, it is supported by thousands and thousands of decisions every day, as opposed to the commercial side of things that can be very different between industrial and retail, for example, that could have a more dramatic effect.  So the overall effect of a slowing in transactions hits all aspects of the residential market more evenly than one might think.  There are some differences in price points, where you have better demand at different price points and the like.  But generally speaking, it has been fairly consistent throughout the markets and throughout the products.  

Operator:

At this time, I am showing no further questions.

Dennis Hudson:

Great.  Well thank you very much for your attendance today and we look forward to our next call.  Hopefully we’ll have some better, clearer information to share with you. Thank you

Operator:

Thank you ladies and gentlemen. This concludes today’s conference. Thank you for participating. You may now disconnect.  

EX-99.3

EXHIBIT 99.3

To 8-K dated January 25, 2007

Seacoast Banking Corporation of Florida

Fourth Quarter 2006 Financial Highlights

Cautionary Notice Regarding Forward-Looking Statements

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, including, without limitation, statements about the benefits of the integration and consolidation of Seacoast with Big Lake and Century, including future financial and operating results, cost savings, enhanced revenues, and accretion to reported earnings that may be realized from the mergers, as well as statements with respect to Seacoast, Big Lake 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,” “support”, “indicate,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “further”, “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 value s 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, Big Lake 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; increased competitive pressures and solicitations of Big Lake and Century’s customers by competitors; as well as the difficulties and risks inherent with entering the Central Florida 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, 2005 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.

Capitalizing on Market Disruption

Treasue Coast Market

	Martin		St. Lucie		Indian River		Total Offices
	Deposits	Offices	Deposits	Offices	Deposits	Offices
Seacoast	755,626	11	285,461	8	230,440	8	27
National City	383,569	8	883,844	11	37,513	6	25
Wachovia	533,193	10	500,517	7	1,383,533	10	27
Bank of America	558,301	10	432,575	8	364,071	6	24
SunTrust	139,616	3	295,704	5	251,832	6	14
Riverside	151,346	3	998,661	8	169,781	4	15
Alabama National	--		--		403,496	5	5

Over $1.5 billion in local community bank deposits will transfer to Cleveland

Source:  SNL Financial June 2006

Capitalizing on Market Disruption

Local Community Banks in Treasure Coast Market
	Deposits	Offices
Seacoast	1,271,527	27
Riverside	1,319,788	15
Gulfstream	268,166	2
Peoples Bank	134,523	3
First Bank of Indiantown	68,545	2
Marine Bank	89,754	2

Source:  SNL Financial June 2006

Total Revenues Increase

(Dollars in thousands)	QTR4 06	QTR4 05	Growth	% Growth
Net Interest Income	$ 21,846	$ 20,062	$ 1,784	8.9	%
Noninterest Income	5,719	5,089	630	12.4
Total Revenues	$ 27,565	$ 25,151	$ 2,414	9.6	%

•

Dollars in Thousands; Excludes Provision for Loan Losses, Interest Rate Swap Profits (Losses), Gains on Sale of Partnership Interest and Securities Gains (Losses)

•

Calculated on a Fully Taxable Equivalent Basis

Overhead Ratio

	Q4-04
Overhead Ratio	65.0%
	Q1-05	Q2-05	Q3-05	Q4-05
Overhead Ratio	65.4%	62.1%	62.5%	62.1%
	Q1-06	Q2-06	Q3-06	Q4-06
Overhead Ratio	62.5%	61.1%	64.7%	64.8%

•

Noninterest Income Excludes Security Gains (Losses), Gain on Sale of Partnership Interest and Interest Rate Swap Profits (Losses)

•

Noninterest Expense Excludes Merger/Nonrecurring Charges and Non-cash Core Deposit Intangible Amortization

•

Net Interest Income is included on a Tax Equivalent Basis

Loan Growth

Loan Growth Remains Strong at a 19% Growth Rate Year over Year, Excluding Big Lake Loans of $197 Million

(Dollars in thousands)	Q4-2005	Q1-2006	Q2-2006	Q3-2006	Q4-2006
Loans, net of unearned income	$1,289,995	$1,339,070	$1,614,646	$1,656,061	1,733,111

Commercial Lending Originations

(Dollars in thousands)	Q4-2005	Q1-2006	Q2-2006	Q3-2006	Q4-2006
Commercial Originations*	$112,000	$117,000	$106,000	$80,000	$140,000

*  Includes Commercial Real Estate

Deposit Performance

Deposits Decline 8.4% Over Last Twelve Months, Excluding Big Lake Deposits of $256 Million

(Dollars in millions)	Q4-04
Core Deposits	907
Time Deposits > $100,000	120
DDA	345
(Dollars in millions)	Q1-05	Q2-05	Q3-05	Q4-05
Core Deposits	976	1,120	1,170	1,138
Time Deposits > $100,000	133	142	167	173
DDA	367	482	442	473
(Dollars in millions)	Q1-06	Q2-06	Q3-06	Q4-06 (1)
Core Deposits *	1,170	1,313	1,279	1,255
Time Deposits >$100,000	193	227	254	244
DDA	441	489	425	392

*Includes Time Deposits < $100,000

(1) DDA Mix 21%

Deposit Mix

	QTR2 06		QTR3 06		QTR4 06
Demand	24	%	22	%	21	%
Core *	65		65		66
Time Deposits > $100,000	11		13		13
Total	100	%	100	%	100	%

*Includes Time Deposits < $100,000

Cost of Deposits

	Q1-05	Q2-05	Q3-05	Q4-05
Fed Funds Rate	2.75%	3.25%	3.75%	4.25%
Cost of Deposits	1.09%	1.18%	1.32%	1.54%
	Q1-06	Q2-06	Q3-06	Q4-06
Fed Funds Rate	4.75%	5.25%	5.25%	5.25%
Cost of Deposits	1.71%	1.99%	2.29%	2.54%

Average Earning Asset Growth

(Dollars in billions)	Q1-05	Q2-05	Q3-05	Q4-05
Average Earning Assets	$1.59	$1.83	$1.89	$1.97

(Dollars in billions)	Q1-06	Q2-06	Q3-06	Q4-06
Average Earning Assets	$1.98	$2.25	$2.18	$2.19

Average loans represent 77% of earning assets at December 31, 2006, compared to 63% at December 31, 2005 and 60% at December 31, 2004

Prime Based Loans

(Dollars in thousands)	Q4-05	Q1-06	Q2-06	Q3-06	Q4-06
Prime Based Loans	$416,000	$426,000	$496,000	$507,000	$528,000

Total Floating Rate Assets

Floating Rate Assets (Loans, Investments, and Overnight Funds)

(Dollars in thousands)	Q4-05	Q1-06	Q2-06	Q3-06	Q4-06
Ending Floating Rate Assets	$677,000	$632,000	$644,000	$568,000	$593,000
Prime Rate	7.25%	7.75%	8.25%	8.25%	8.25%

Net Interest Margin and Net Interest Income

(Dollars in thousands)	Q4-05	Q1-06	Q2-06	Q3-06	Q4-06
Net Interest Margin	4.04%	4.16%	4.29%	4.22%	3.95%
Net Interest Income	$20,062	$20,274	$24,030	$23,144	$21,846

Excludes Provision for Loan Losses; Calculated on a Fully Taxable Equivalent Basis using Amortized Cost

Service Area

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Seminole County

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Orange County

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Brevard County

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Indian River County

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Okeechobee County

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St. Lucie County

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Martin County

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Palm Beach County

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Hardee County

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Highlands County

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Desoto County

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Glades County

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Hendry County