8-K

UNITED STATESSECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


FORM 8-K
CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): April 24, 2008

FNB United Corp.

(Exact Name of Registrant as Specified in its Charter)

North Carolina	0-13823	56-1456589
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

150 South Fayetteville Street,          Asheboro, North Carolina	27203
(Address of Principal Executive Offices)	(Zip Code)

Registrant's Telephone Number, Including Area Code (336) 626-8300

N/A

(Former Name or Former Address, if Changed Since Last Report)

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:

⃞ 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))

Item 2.02     Results of Operations and Financial Condition

On April 24, 2008, FNB United Corp. issued a news release announcing the results of operations for the quarter ended March 31, 2008. A copy of the FNB United news release is attached hereto as Exhibit 99.1.

The information in this Form 8-K and Exhibit 99.1 attached hereto 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 any filing made by FNB United under the Securities Act of 1933, whether made before or after the date hereof, except as shall be expressly set forth by specific reference in such filing.

Item 9.01     Financial Statements and Exhibits

Exhibits:
99.1	News release dated April 24, 2008

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.

		FNB UNITED CORP.
Date:	April 24, 2008	By:	/s/ Mark A. Severson
			Mark A. Severson
			Executive Vice President
			(Principal Financial and
			Accounting Officer)

INDEX TO EXHIBITS

Exhibit No.	Description
99.1	News Release dated April 24, 2008.

EX-99.1

Exhibit 99.1

FNB United Corp. Earns $2.0 Million in First Quarter Fueled by Strong Loan and Core Deposit Growth

ASHEBORO, N.C.--(BUSINESS WIRE)--FNB United Corp. (NASDAQ:FNBN), the holding company for CommunityONE Bank, N.A. and its wholly owned subsidiary, Dover Mortgage Company, today reported first quarter profits for the period ended March 31, 2008. After a $1.5 million provision for loan losses, of which $1.1 million was directly related to first quarter 2008 loan production, FNB United earned $2.0 million, or $0.18 per diluted share, in the first quarter of 2008, compared to $3.8 million, or $0.33 per diluted share, in the first quarter a year ago.

“Over the past several months we have adapted to interest rate margin compression and an overall tougher business environment by implementing strategies to protect the margin, improve asset quality, and grow noninterest-bearing demand deposits,” stated Michael Miller, President and CEO. “Our initiatives are proving favorable as we have increased loans 17% and core deposits 3%. Profits were hampered by our increased provision for loan losses compared to the year ago quarter, primarily due to strong loan production in the first quarter of 2008.”

First Quarter 2008 Highlights

• Net income was $2.0 million, or $0.18 per diluted share.
• Net interest margin was 3.68%, compared to 4.15% for the 1^st quarter of 2007.
• Loans held for investment increased 17% over the year ago quarter, to $1.54 billion.
• Noninterest-bearing deposits were $167.5 million at March 31, 2008, compared to $161.9 million a year ago.
• Cash management retail repurchase agreements up 32% over a year ago.
• Total assets increased to $2.03 billion at March 31, 2008, a 9% increase over a year ago.
• Net chargeoffs totaled $680,000.

Credit Quality

FNB United continues to focus on credit quality and as a result nonperforming assets (NPAs) have decreased compared to the previous quarter. At March 31, 2008, total nonperforming assets were $18.6 million, or 0.92% of total assets, a decrease from $21.6 million, or 1.13% of total assets, three months earlier. Nonperforming assets were $14.7 million, or 0.78%, of total assets at March 31, 2007. Other real estate owned (OREO) increased during the quarter to $4.1 million, from $2.9 million at the end of the fourth quarter of 2007. Net charge offs were 0.18% of average loans outstanding for the quarter ended March 31, 2008, compared to 0.21% in the year ago period.

“We are encouraged with the stability we have seen in the western and central North Carolina real estate markets. Real estate values have held up well when compared to other regions of the country,” said Miller. “We are closely monitoring production levels to ensure strong lending standards are being followed, as well as managing spreads based on increased funding costs.”

FNB United recorded a $1.5 million provision to its allowance for loan losses in the first quarter of 2008. This compared to $3.0 million for the previous quarter, and $524,000 in the first quarter a year ago. The allowance for loan losses was $18.2 million, or 1.18% of loans held for investment at March 31, 2008, compared to $17.4 million, or 1.20%, at the end of the preceding quarter and $15.8 million or 1.20%, at the end of March 2007.

Balance Sheet

Assets increased 9%, to a record $2.03 billion at March 31, 2008, compared to $1.87 billion a year earlier. Loans held for investment increased 17%, to $1.54 billion at March 31, 2008, compared to $1.31 billion a year earlier.

FNB United has not originated any subprime real estate loans and has no subprime MBS or CDO exposure in its investment portfolio.

“We continue to shift our deposit emphasis from certificates of deposits to transaction accounts,” said Miller. “In September 2007 we initiated a new transaction deposit product that pays a premium interest rate, provides for increased fee income by promoting debit card usage, and also provides operating efficiencies through electronic statement delivery and lower transaction costs. We have seen improvements in our transaction account balances in the first quarter, and I expect we will see continued improvements as this product matures.” Total deposits were $1.49 billion at the end of March 2008, compared to $1.47 billion a year earlier. Noninterest-bearing deposits and certificates of deposit each increased 3%, compared to year ago levels.

Shareholders’ equity increased 3%, to $217.2 million, compared to $210.4 million a year earlier. Book value per share improved to $19.07 at March 31, 2008, from $18.54 a year earlier, and tangible book value per share was $8.84 at quarter- end, compared to $8.13 a year earlier.

Operating Results

First quarter 2008 net interest income before the provision for loan losses was $15.4 million, compared to $15.8 million for the first quarter a year ago. Noninterest income was $4.4 million, compared to $4.9 million in the first quarter a year ago, largely due to a $150,000 writedown of mortgage servicing rights and a decrease in mortgage loan sales income from Dover Mortgage associated with the slowing housing market and certain office closings. Total revenues (net interest income before the provision for loan losses plus noninterest income) were $19.8 million, compared to $20.8 million in the first quarter a year ago.

“The Federal Reserve reduced the federal funds rate 75 basis points on January 22nd and 50 basis points on January 30^th, which directly affected our net interest margin during the first quarter,” said Miller. “We expect the most recent reduction in the federal funds rate of 75 basis points on March 18th to further compress our margins in the second quarter of 2008, since our deposit costs reprice at a slower pace than our interest earning assets. Demand for liquidity and funding, driven particularly by the large financial institutions, has contributed to the increase in funding costs.” First quarter net interest margin was 3.68%, compared to 4.06% in the fourth quarter of 2007 and 4.15% in the first quarter a year ago. The yield on earning assets for the first quarter of 2008 dropped 88 basis points compared to the year ago quarter while the cost of interest-bearing liabilities declined only 44 basis points.

For the first quarter, noninterest expense was $15.4 million, compared to $15.7 million in the preceding quarter and $14.6 million in the first quarter a year ago. The increase in expenses compared to the year ago quarter was due in large part to an increase in personnel expense of $279,000, or 3.3%, and an increase in the reserve for unfunded commitments of $232,000.

About the Company

FNB United Corp. is the central North Carolina-based bank holding company for CommunityONE Bank, N.A., and the bank’s subsidiary, Dover Mortgage Company. Opened in 1907, CommunityONE (MyYesBank.com) operates 43 offices in 35 communities throughout central, southern and western North Carolina. Opened in 1986, Dover (DoverMortgage.com), based in Charlotte, NC, joined FNB United in 2003 and has a retail origination network in key growth markets across the state in addition to wholesale operations. Through these companies, FNB United offers a complete line of consumer, mortgage and business banking services, including loan, deposit, cash management, wealth management and internet banking services.

This news release may contain forward-looking statements regarding future events. Forward-looking statements often address our expected future business and financial performance, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” or “will.” These statements are only predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include risks of managing our growth, changes in financial markets, changes in real estate markets, regulatory changes, changes in interest rates, changes in economic conditions being less favorable than anticipated, and loss of deposits and loan demand to other financial institutions. Additional information concerning factors that could cause actual results to be materially different from those in the forward-looking statements is contained in FNB United’s filings with the Securities and Exchange Commission. FNB United does not assume any obligation to update these forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.

RESULTS OF OPERATIONS			Quarter to Date				Percent
(In thousands except share and per share data)			March 31, 2008		March 31, 2007		Change
INTEREST INCOME:
	Interest and fees on loans		$	27,537	$	27,870	-1	%
	Interest and dividends on investments securities:
		Taxable income		2,134		1,656	29	%
		Non-taxable income		527		553	-5	%
	Other interest income			12		818	-99	%
		Total interest income		30,210		30,897	-2	%
INTEREST EXPENSE:
	Deposits			11,806		12,798	-8	%
	Borrowed funds			2,974		2,274	31	%
		Total interest expense		14,780		15,072	-2	%
	Net interest income before provision for loan losses			15,430		15,825	-2	%
PROVISION FOR LOAN LOSSES				1,514		524	189	%
	Net interest income after provision for loan losses			13,916		15,301	-9	%
NONINTEREST INCOME:
	Service charges on deposit accounts			2,084		2,050	2	%
	Mortgage loan sales			923		1,138	-19	%
	Cardholder and merchant services income			480		507	-5	%
	Trust and investment services			463		371	25	%
	Other service charges, commissions and fees			113		336	-66	%
	Bank owned life insurance			249		236	6	%
	Other income			45		304	-85	%
		Total noninterest income		4,357		4,942	-12	%
NONINTEREST EXPENSE:
	Salaries and employee benefits			8,699		8,420	3	%
	Net occupancy expense			1,299		1,178	10	%
	Furniture and equipment expense			1,136		1,113	2	%
	Data processing services			457		532	-14	%
	Other expense			3,777		3,338	13	%
		Total noninterest expense		15,368		14,581	5	%
	Income before provision for income taxes			2,905		5,662	-49	%
PROVISION FOR INCOME TAXES				885		1,910	-54	%
NET INCOME			$	2,020	$	3,752	-46	%
Earnings per common share:
		Basic	$	0.18	$	0.33	-47	%
		Diluted	$	0.18	$	0.33	-47	%
Cash dividends declared per common share			$	0.15	$	0.15	0	%
Weighted average shares outstanding:
		Basic		11,386,767		11,263,325
		Diluted		11,386,767		11,295,221

FINANCIAL CONDITION			As of / For the Quarters Ended						Percent
(In thousands except share and per share data)			March 31, 2008			March 31, 2007			Change
ASSETS
Cash and due from banks			$	38,333		$	38,905		-1	%
Interest-bearing bank balances				220			10,757		-98	%
Federal funds sold				532			50,130		-99	%
Securities available for sale				203,598			182,552		12	%
Securities held to maturity				28,030			42,318		-34	%
Loans held for sale				15,121			26,497		-43	%
Loans held for investment				1,541,119			1,313,168		17	%
		Allowance for loan losses		(18,215	)		(15,757	)	16	%
		Net loans held for investment		1,522,904			1,297,411		17	%
Property and equipment, net				48,059			45,780		5	%
Goodwill				110,195			110,961		-1	%
Core deposit premiums				6,362			7,173		-11	%
Other assets				61,626			61,920		0	%
			$	2,034,980		$	1,874,404		9	%
LIABILITIES
Deposits:
		Noninterest-bearing	$	167,511		$	161,908		3	%
		Interest-bearing deposits:
		Demand, savings, and money market deposits		471,733			480,003		-2	%
		Time deposits		846,405			823,800		3	%
				1,485,649			1,465,711		1	%
Retail repurchase agreements				35,815			27,225		32	%
Federal Home Loan Bank advances				192,413			65,866		192	%
Other borrowed funds				84,673			83,439		1	%
Other liabilities				19,234			21,739		-12	%
				1,817,784			1,663,980		9	%
SHAREHOLDERS' EQUITY
Common stock				28,563			28,371		1	%
Surplus				114,293			112,873		1	%
Retained earnings				74,506			70,716		5	%
Accumulated other comprehensive income (loss)				(166	)		(1,536	)	-89	%
				217,196			210,424		3	%
			$	2,034,980		$	1,874,404		9	%
Shares Issued:
Shares outstanding at end of period				11,386,836			11,348,201		0	%
Book value per share (1)			$	19.07		$	18.54		3	%
Tangible book value per share (1)			$	8.84		$	8.13		9	%
(1	)	- Calculation is based on number of shares outstanding at the end of the period.

ADDITIONAL FINANCIAL INFORMATION
(Dollars in thousands)			As of / For the Quarters Ended
NONPERFORMING ASSETS:			March 31, 2008			March 31, 2007
Loans on nonaccrual status			$	13,924		$	8,282
Loans more than 90 days delinquent, still accruing				594			2,852
Total nonperforming loans				14,518			11,134
Other real estate owned (OREO) / Repossessed assets				4,119			3,557
		Total nonperforming assets	$	18,637		$	14,691
Total nonperforming assets / Total assets				0.92	%		0.78	%
CHANGE IN THE
ALLOWANCE FOR LOAN LOSSES:			March 31, 2008			March 31, 2007
Balance, beginning of period			$	17,381		$	15,943
Provision				1,514			524
Recoveries of loans previously charged off				366			488
Loans charged-off				(1,046	)		(1,198	)
Balance, end of period			$	18,215		$	15,757
Net chargeoffs (annualized) / Average loans outstanding				0.18	%		0.21	%
Allowance for loan losses / Loans held for investment				1.18	%		1.20	%
DEPOSITS			March 31, 2008			March 31, 2007
Noninterest-bearing			$	168,194		$	161,908
Interest-bearing transaction deposits:
	Checking			173,137			173,426
	Money Market			256,349			255,639
	Savings			42,247			50,938
		Total interest-bearing transaction deposits		471,733			480,003
Interest-bearing time deposits				846,405			823,800
		Total deposits	$	1,486,332		$	1,465,711

ADDITIONAL FINANCIAL INFORMATION
(Dollars in thousands)
(Rates / Ratios Annualized)
		For the Quarters Ended
OPERATING PERFORMANCE:		March 31, 2008			March 31, 2007
Average loans		$	1,506,582		$	1,330,199
Average investments			213,852			190,569
Avg other earning assets			1,530			62,050
Average noninterest-earning assets			238,301			244,777
	Total average assets	$	1,960,265		$	1,827,595
Average interest-bearing deposits		$	1,294,588		$	1,270,649
Average noninterest bearing deposits			157,436			155,991
Average borrowings			271,323			170,629
Average noninterest-bearing liabilities			19,202			21,148
	Total average liabilities		1,742,549			1,618,417
Total average shareholders' equity			217,716			209,178
		`
	Total average liabilities and shareholders' equity	$	1,960,265		$	1,827,595
Interest rate yield on loans			7.37	%		8.51	%
Interest rate yield on securities			5.51	%		5.26	%
Interest rate yield on other earning assets			3.14	%		5.28	%
	Interest rate yield on interest-earning assets		7.13	%		8.01	%
Interest rate expense on deposits			3.65	%		4.08	%
Interest rate expense on borrowings			4.38	%		5.40	%
	Interest rate expense on interest-bearing liabilities		3.80	%		4.24	%
Interest rate spread			3.34	%		3.77	%
Net interest margin			3.68	%		4.15	%
Noninterest income / Average assets			0.89	%		1.10	%
Noninterest expense / Average assets			3.14	%		3.24	%
Efficiency ratio ( noninterest expense / revenue )			77.67	%		70.21	%
Return on average assets			0.41	%		0.83	%
Return on average tangible assets			0.44	%		0.89	%
Return on average equity			3.72	%		7.26	%
Return on average tangible equity			8.02	%		16.64	%
Average equity / Average assets			11.11	%		11.45	%

CONTACT:
FNB United Corp.
Mark Severson, CFO, 336-626-8351