8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

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

Date of Report (Date of Earliest Event Reported) July 29, 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 (see General Instructions A.2. below):

¨ 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 7.01. Regulation FD Disclosure.

On July 30, 2008, FNB United Corp. is to make a presentation at the Community Bank Investor Conference sponsored by Keefe, Bruyette & Woods in New York, New York. The presentation will include information about FNB United, its business, recent financial performance and core strategies. FNB United’s presentation materials are furnished as Exhibit 99.1 hereto and are incorporated by reference into this Item 7.01. FNB United assumes no obligation to update such presentation materials in the future.

The information contained in this Current Report on 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, as amended (the “Exchange Act”), nor shall it be deemed incorporated by reference in any filing made by FNB United under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1 Presentation materials

This Current Report on Form 8-K (including information included or incorporated by reference herein) may contain, among other things, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements regarding certain of FNB United’s goals and expectations regarding earnings, income per share, revenue, expenses and the growth rate in such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, and (ii) statements preceded by, followed by or including the words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “projects,” “outlook” or similar expressions. These statements are based upon the current belief and expectations of FNB United’s management and are subject to significant risks and uncertainties that are subject to change based on various factors, many of which are beyond FNB United’s control.

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: July 29, 2008	By	/s/ R. Larry Campbell
		R. Larry Campbell
		Executive Vice President

EXHIBIT INDEX

Exhibit Number	Description of Exhibit
99.1	Presentation materials

EX-99.1

1

FNB UNITED CORP.

Keefe, Bruyette

& Woods

Community Bank Investor Conference

New York City, NY

July 29-30, 2008

Yes You Can

®

Yes We Can

®

Exhibit 99.1

2

Forward-Looking Statements

FNB

United

Corp.

has

made

forward-looking

statements

in

the

accompanying

presentation

materials

that

are

subject

to

risks

and

uncertainties.

These

statements

are

based

on

the

beliefs

and

assumptions

of

the

management

of

FNB

United

Corp.,

and

on

the

information

available

to

management

at

the

time

the

presentation

materials

were

prepared.

These

forward-looking

statements

involve

certain

risks

and

uncertainties,

including

a

variety

of

factors

that

may

cause

FNB

United

Corp’s

actual

results

to

differ

materially

from

the

anticipated

results

or

other

expectations

expressed

in

such

forward-

looking

statements.

Readers

are

cautioned

not

to

place

undue

reliance

on

these

forward-looking

statements

and

are

advised

to

carefully

review

the

risk

factors

described

in

other

documents

that

FNB

United

Corp.

files

from

time

to

time

with

the

Securities

and

Exchange

Commission,

including

the

Quarterly

Reports

on

Form

10-Q,

the

Annual

Report

on

Form

10-K,

and

other

required

filings.

3

FNB

UNITED

–

Presentation

Contents

•

Why F    U

Who We Are

Value Metrics

•

Financial Highlights

•

Management & Culture

•

Business Strategy

•

Questions

NB

NITED

4

Why FNB UNITED

•

Solid Franchise

•

Historical Solid Operating

Performance

•

Committed to Improved Future

Performance

…

An Attractive Value

5

Why FNB UNITED -

Value

1907, as First National Bank of 

Asheboro

Founded:

115,000 +

43 Banking Offices

35 Communities in 17 N.C. Counties

Customers:

Locations:

$1.49 Billion

Deposits:

$1.56 Billion

Loans:

$2.06 Billion

Assets:

Top-10 Ranked Financial Service Company

HQ’d in North Carolina

6

Yes You Can

®

Yes We Can

®

The Yes!

Bank Franchise

7

FNB UNITED Acquisitions

28

$1,091 MM

TOTAL

OTHER

$25MM

Dover Mortgage Company

April 2003

Offices

Assets

BANKS

$680 MM

$151 MM

$134 MM

$126 MM

Integrity Financial Inc.

(Catawba Valley/First

Gaston/Northwestern Banks)

United Financial Inc.

(Alamance/Hillsborough Banks)

Rowan Bancorp.

(Rowan Savings Bank)

Carolina Fincorp. Inc

(Richmond Savings Bank)

17

May 2006

3

November 2005

3

August 2002

5

April 2000

8

Value -

Investor Opportunity

Dividend Yield (%)

5.56

FNB United

Corp.*

3.48

SNL Banks

Peer Group**

Price / LTM EPS (X)

11.2

FNB United

Corp.*

13.2

SNL Banks

Peer Group**

2.20

NC Banks***

11.4

NC Banks***

*FNB United $7.20 as of 07/23/08

**SNL Data –

Banks between $1 -

$5 billion as of 07/18/08

***SNL Data –

NC State Public Bank Median as of 07/11/08

9

Price / Book (%)

Price / Tangible Book (%)

*FNB United $7.20 as of 07/23/08

**SNL Data –

Banks between $1 -

$5 billion as of 07/18/08

***SNL Data –

NC State Public Bank Median as of 07/11/08

38.0

FNB United

Corp.*

139.0

SNL Banks

Peer Group**

82.0

FNB United

Corp.*

186.0

SNL Banks

Peer Group**

94.0

NC Banks***

104.0

NC Banks***

Value -

Investor Opportunity

10

Financial Highlights

11

$1,307

$1,446

$1,556

$1,421

$1,441

$1,486

2006

2007

Q2-2008

2006

2007

Q2-2008

Loan and Deposit Growth

(In Millions)

Loan Growth

Deposit Growth

(unaudited)

(unaudited)

12

•

No Sub-Prime Mortgages

•

No Alt-A Mortgages

•

No Non-Agency MBS/CMOs

Yes You Can

®

Yes We Can

®

Yes You Can

®

Yes We Can

®

Asset Composition

13

Loan Portfolio Composition

June 30, 2008

9%

13%

25%

12%

9%

19%

3%

7%

3%

Commercial & Industrial

CRE - Income Property

Commercial Owner-Occupied

(including construction)

1-4 Owner-Occupied

(including construction)

1-4 Residential Rental

(including construction)

Development, Land, &

CRE Construction

Consumer & Ag. RE

HELOC

Other Consumer

Approximately 78% secured by real estate

Variable rate loans account for approximately 63% of the total portfolio

Loan Portfolio Mix

14

Portfolio Detail

See

Appendix

For Additional

Loan Portfolio Stratification

15

0.47%

1.12%*

0.68%

0.80%

2004

0.22%

1.25%*

0.64%

0.76%

2005

0.16%

1.22%

0.82%

0.85%

2006

0.27%

1.20%

1.13%

1.29%

2007

0.187%

Net Charge Offs

Average Loans (annualized)

1.20%

Loan Loss Reserve

Total Loans Held for

Investment

0.90 %

NPA’s/Total Assets

0.80 %

Nonperforming Loans

Total Loans Held for

Investment

Q2 2008

(unaudited)

Asset Quality

Asset Quality

*  Includes reserve for unfunded commitments

(See Appendix)

16

NPA's / Total Assets

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

2004

2005

2006

2007

Q1-2008

unaudtd

Q2-2008

unaudtd

Asset Quality

17

Reserves v. Loss Experience

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

2004

2005

2006

2007

Q1-2008

unaudtd

Q2-2008

unaudtd

Reserve for Loan Losses / Total Loans HFI

Net Charge Offs / Average Loans

Asset Quality

18

HELOC Quality Statistics

•

Outstanding Balances

-

$109,581,271

•

Committed Lines -

-

$234,297,700

•

% Portfolio –

8.8%

•

Secured by 1st Lien –

Lines             –

37.6%   

Outstandings

–

28.4%

•

Lines exceeding 90%

Combined LTV -

1.6%

•

Impaired and Non

Accrual -

.14%

•

Delinquent > 29 days

-

.39%

•

Trailing 4 quarters’

loss -

.124%

19

Funding Mix

FHLB/FFP

13%

CD / IRA

47%

NOW

10%

IMM/SAV/Repo

21%

DDA

9%

Funding Portfolio

June 30, 2008

20

Funding Highlights

•

CheckingONE

–

rolled out September 2007

Debit Card Activity Requirement

Online Banking

eStatement

$34 million as of 06/30/2008 (38% new money)

Profitable since inception

•

“Positive Power”

and “Money MarketONE”

Accounts

Above market rate through 09/30

$105,000,000 as of 06/30/2008  (61% new money)

•

Brokered Deposits –

only $12,000,000 as of

06/30/2008

21

Profitability

$12,187

$1,625

$12,361

$358

$2,463

$1,800

2006

2007

Q2-08 YTD

$1.25

$0.17

$1.09

$0.03

$0.21

$0.16

2006

2007

Q2-08 YTD

Operating Net Income

Operating Earnings Per Share

(In Thousands)

(unaudited)

(unaudited)

$13,812

$12,719

$4,263

$1.42

$1.12

$0.37

Reported Earnings

Goodwill Writedown

22

Profitability

4.20%

4.00%

3.54%

2006

2007

Q2-08 YTD

Net Interest Margin

Operating Return

On Average Assets

0.77%

0.11%

0.66%

0.02%

0.25%

0.18%

2006

2007

Q2-08 YTD

(unaudited)

(unaudited)

0.88%

0.68%

0.43%

Reported Earnings

Goodwill Writedown

23

Return On Equity

11.25%

14.36%

7.00%

14.75%

5.81%

12.99%

2.28%

4.90%

2005

2006

2007

YTD Q2-08

Return on Ave. Equity

Return on Ave. Tangible Equity

(unaudited)

24

Capital

•

Well Capitalized

•

Raised $15 million sub debt in second quarter 2008

•

$10 million revolving credit facility in second

quarter 2008 -

undrawn

•

Reduced dividend in 2

nd

Quarter from $0.15 to

$0.10   (still greatly exceeds peer)

Impact on Capital –

$2,300,000/year

Target payout –

25-30% of earnings

25

FNB United Culture

26

Our Culture

•

Performance and Team Oriented

•

Participative and Positive

•

Service

•

Education / Training

•

Accountable

•

Hardest Part of Merger Integration

27

Participative and Positive

Yes you can.

®

CommunityONE

is the Yes Bank.  It is plainly stated in our

Yes you can

®

—

Yes we can

®

trademarks, and often repeated

in our customer service programs, company spirit campaigns

and marketing messages.  More than a motto, however, Yes

is

our promise to help you reach your financial goals and dreams. 

This is what we do.  This is who we are.  For the past 100 years. 

And for the next 100, too.  Because when you believe in the

power of Yes, anything is possible.

The power of positive banking.SM

28

Business Strategy –

Earnings and Growth

Opportunities

29

Core Strategies

•

Manage/Improve Asset Quality

•

Restore Historical Financial Performance

Stronger Pricing Models / Improve Mix

Grow Fee Income –

Wealth Management,

Mortgage Banking

Expense Control –

Staffing + Electronic

Transactions + New Project

•

Profitable Franchise Growth

Increase Penetration of Current Markets

Targeted DeNovo

Offices

30

Improving Financial Performance

Sales Initiatives –

Minimize Funding Gap

•

Core Deposit Focus

New CheckingONE

Deposit (NOW) Account

New Money Market Account

Enhance Corporate Cash Management

Increase Merchant Service Relationship

Promote Remote Capture

Continued Low Reliance on Brokered Deposits

31

Improving Financial Performance

Integration and Cost Savings Initiatives:

Improve profitability –

streamline operation

Objective -

$3.9 -5.5 MM of opportunities

To date staff reductions $960,000

annualized

In depth analysis in process

•

Staffing –

Corporate, Retail and Operations

•

Non-interest income

•

Vendor Management

•

Improved Management Reporting

32

Improving Financial Performance

New eStatement Users 2007-2008

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

33

Wealth Management

•

Full suite of products and services offered

through experienced personnel.  Average of 22

years experience

•

Technology used positively

Internet delivery of Investment Performance

Electronic Client Statements

24hr Account Access

24/7 Voice Response system for 401k participants as

well as on-line planning tools

•

High Touch -

Face to Face meetings

•

Client Retention rate of 95% for the last 3 years

34

Wealth Management Revenues

$0.00

$200,000.00

$400,000.00

$600,000.00

$800,000.00

$1,000,000.00

$1,200,000.00

$1,400,000.00

2004

2005

2006

2007

YTD 2008

35

Trust –

Assets Managed

$0

$50,000,000

$100,000,000

$150,000,000

$200,000,000

$250,000,000

2004

2005

2006

2007

YTD 2008

Discretionary

Non-Discretionary

Employee Benefits

Total

36

The “New”

Dover Mortgage 

Now sub of bank

New leadership

New system &

Operations

New Markets

Expanded

Wholesale

Reverse Mortgages

37

Company Growth Strategy

•

Increase Penetration of Current Markets

Attractive New Markets & Customer Base

•

De Novo Offices

Two Offices to open in 2008 (Greensboro-

Cornelius)

•

Promote Wealth Management/Mortgage -

Fee Businesses in CommunityONE

Bank

•

Increased Synergy With and Contribution From

Dover Mortgage

38

Summary

39

Summary –

Why FNB UNITED

•

Growing Company in Good Markets

•

Proven Integrator -

Fixer

•

Focused on Credit Quality and

Performance Improvement

…

equals …

Compelling Investment Opportunity

40

Questions?

41

Contact Information

Michael C. Miller

Chairman, President & CEO

Mike.Miller@MyYesBank.com

Mark A. Severson

Chief Financial Officer

Mark.Severson@MyYesBank.com

FNB United Corp.

CommunityONE

Bank, N.A.

150 S. Fayetteville Street

PO Box 1328

Asheboro, NC  27204

336.626.8300

Yes You Can

®

Yes We Can

®

Appendix I

Historical Asset Quality Measurements

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

2003

2004

2005

2006

2007

Q1-2008

unaudtd

Q2-2008

unaudtd

% of Capital

(Bars)

0.00%

20.00%

40.00%

60.00%

80.00%

100.00%

120.00%

140.00%

160.00%

180.00%

% of Porfolio

(Lines)

Nonperforming Loans / Total Loans HFI

Reserve for Loan Losses / Total Loans HFI

Net Charge Offs / Average Loans

OREO & Repossessed Assets / Total Assets

Reserve for Loan Losses / NPL's

Portfolio Composition

June 30, 2008

9%

13%

22%

3%

10%

2%

6%

3%

3%

11%

5%

3%

7%

3%

C&I

CRE - N/O

CRE O/O

Construction, Commercial, O/O

1-4 Residential 1st Mortgage, O/O

Construction, 1-4, O/O

1-4 Residential 1st Mortgage, N/O

Construction, 1-4, N/O

Construction, Commmercial, N/O

RE Development

Commercial, Land Only

Other RE, Consumer & Ag

HELOC

Other, non RE

Appendix II

Real Estate Portfolio Segment

Strata

Balances

(000's)

Strata / Portfolio

Composition

Industry Segment

Segment

Balance

(000's)

Strata

Composition

Segment /

Portfolio

Composition

Commercial, Owner Occupied

270,732

19.4%

Hotels

26,143

9.7%

1.9%

Commercial Construction

14,442

5.3%

1.0%

Other Real Estate Activities

14,007

5.2%

1.0%

Residential Construction

13,286

4.9%

1.0%

Mini-warehouses & Self Storage

12,603

4.7%

0.9%

Management Companies

10,798

4.0%

0.8%

All Others

179,453

66.3%

12.9%

Commercial Income Properties, Non-Owner Occupied

239,472

17.2%

Commercial Lessors

107,046

44.7%

7.7%

Residential Lessors

32,363

13.5%

2.3%

Residential Construction

29,535

12.3%

2.1%

Commercial Construction

10,277

4.3%

0.7%

Nursing Care Facilities

6,583

2.7%

0.5%

Land Subdivision

6,540

2.7%

0.5%

RE Property Managers

5,759

2.4%

0.4%

Other Real Estate Activities

3,860

1.6%

0.3%

Mini-warehouses & Self Storage

2,314

1.0%

0.2%

All Others

35,195

14.7%

2.5%

1-4 Residential, Owner-Occupied

160,664

11.5%

1-4 Residential, Non-Owner Occupied

92,597

6.6%

Construction, 1-4 Residential, Non-Owner Occupied

98,412

7.1%

Construction, 1-4 Residential, Owner-Occupied

35,061

2.5%

Commercial Construction, Non-Owner Occupied

39,784

2.9%

Commercial Lessors

10,208

25.7%

0.7%

Limited-Service Restaurants

9,137

23.0%

0.7%

Residential Construction

8,362

21.0%

0.6%

Commercial Construction

7,443

18.7%

0.5%

Residential Lessors

2,976

7.5%

0.2%

Multifamily

892

2.2%

0.1%

RE Property Managers

766

1.9%

0.1%

Appendix III

Real Estate Portfolio Segment

Strata

Balances

(000's)

Strata / Portfolio

Composition

Industry Segment

Segment

Balance

(000's)

Strata

Composition

Segment /

Portfolio

Composition

Commercial Construction, Owner Occupied

13,934

1.0%

Mini-warehouses & Self Storage

5,772

41.4%

0.4%

Industrial Building Construction

3,332

23.9%

0.2%

Hotels

2,692

19.3%

0.2%

All Others

2,138

15.3%

0.2%

Land Development

165,252

11.8%

Residential Subdivision

135,720

82.1%

9.7%

Commercial Land Development

13,416

8.1%

1.0%

All Others

16,116

9.8%

1.2%

Land Only, Commercial

83,419

6.0%

Residential Developers

13,514

16.2%

1.0%

Commercial Lessors

11,531

13.8%

0.8%

Residential Builders

11,430

13.7%

0.8%

Commercial Builders

7,133

8.6%

0.5%

Residential Lessors

4,644

5.6%

0.3%

All Others

35,167

42.2%

2.5%

HELOC

107,205

7.7%

Consumer (not HELOC)

18,835

1.3%

Other Commercial

40,568

2.9%

Fire Protection

5,579

13.8%

0.4%

Churches

25,253

62.2%

1.8%

All Others

9,736

24.0%

0.7%

Farmland

29,885

2.1%

Total Real Estate-Secured Loan Portfolio

1,395,820

Appendix III