Segment Information

9 Months Ended

Sep. 30, 2011

NOTE 6 — SEGMENT INFORMATION

The Successor’s Company has a single operating segment, its 34% ownership of Capital Bank, NA, which is accounted for using the equity method. Thus, segment information is not relevant for the Successor Company. Given the NAFH Investment and Bank Merger, and as segment information has been previously reported through June 30, 2011, management determined that segment information for the July 1, 2011 through September 7, 2011 Predecessor period would not be meaningful.

The Predecessor Company’s operating segments include banking, mortgage banking, consumer finance, automobile lending and title insurance. The reportable segments are determined by the products and services offered, and internal reporting. Loans, investments and deposits provide the revenues in the banking operation; loans and fees provide the revenues in consumer finance and mortgage banking and insurance commissions provide revenues for the title insurance company. Consumer finance, automobile lending and title insurance do not meet the quantitative threshold on an individual basis, and are therefore shown below in “Other Segments”. Mortgage banking operations are included in “Bank”. All operations are domestic.

Predecessor Company segment performance is evaluated using net interest income and non-interest income. Income taxes are allocated based on income before income taxes, and indirect expenses (includes management fees) are allocated based on time spent for each segment. Transactions among segments are made at fair value. Information reported internally for performance assessment follows.


				Other		Holding
Predecessor	Bank			Segments		Company			Eliminations			Totals
Three months ended Sept. 30, 2010
Net interest income (expense)	$	19,171		$	2,107	$	(531	)	$	—		$	20,747
Provision for loan losses		36,449			374		—			—			36,823
Noninterest income		8,793			448		15			(227	)		9,029
Noninterest expense		25,199			1,167		870			(227	)		27,009
Income tax expense (benefit)		926			397		(225	)		—			1,098

Segment profit (loss)	$	(34,610	)	$	617	$	(1,161	)	$	—		$	(35,154	)

Segment assets at Sept. 30, 2010	$	2,364,169		$	42,139	$	8,706		$	—		$	2,415,014

Predecessor


				Other		Holding
	Bank			Segments		Company			Eliminations			Totals
Nine months ended Sept. 30, 2010
Net interest income (expense)	$	59,098		$	6,273	$	(1,492	)	$	—		$	63,879
Provision for loan losses		44,244			1,217		—			—			45,461
Noninterest income		24,850			1,236		81			(681	)		25,486
Noninterest expense		64,616			3,423		1,471			(681	)		68,829
Income tax expense (benefit)		3,841			1,124		(743	)		—			4,222

Segment profit (loss)	$	(28,753	)	$	1,745	$	(2,139	)	$	—		$	(29,147	)

Predecessor


As of and for the period ended September 30, 2010	Bank			Other			Total

Nonperforming loans as a percentage of total loans, net of unearned income		6.75	%		1.50	%		6.73	%
Nonperforming assets as a percentage of total assets		8.13	%		1.54	%		8.16	%
Allowance for loan losses as a percentage of total loans, net of unearned income		2.58	%		7.80	%		2.74	%
Allowance for loan losses as a percentage of nonperforming loans		38.22	%		518.99	%		40.76	%
YTD net charge-offs to average total loans, net of unearned income		2.26	%		3.06	%		2.31	%

Predecessor


As of and for the period ended December 31, 2010	Bank			Other			Total

Nonperforming loans as a percentage of total loans, net of unearned income		8.40	%		1.30	%		8.35	%
Nonperforming assets as a percentage of total assets		8.52	%		1.34	%		8.56	%
Allowance for loan losses as a percentage of total loans, net of unearned income		3.68	%		7.33	%		3.83	%
Allowance for loan losses as a percentage of nonperforming loans		43.80	%		562.24	%		45.83	%
YTD net charge-offs to average total loans, net of unearned income		2.76	%		4.20	%		2.84	%

Predecessor


Net Charge-offs	Bank		Other		Total
For the period ended September 30, 2010	$	43,973	$	1,326	$	45,299
For the year ended December 31, 2010	$	52,615	$	1,823	$	54,438