EX-99.1 2 ex99-1.htm EXHIBIT 99.1 ex99-1.htm
Exhibit 99.1
GRAPHIC
 


For Immediate Release

For more information:
Rex S. Schuette
Chief Financial Officer
(706) 781-2266
Rex_Schuette@ucbi.com


UNITED COMMUNITY BANKS, INC. REPORTS
EARNINGS OF $11.8 MILLION FOR FIRST QUARTER 2013

·  
Net income of $11.8 million, or 15 cents per share
·  
Loans up $18.6 million from fourth quarter, or 2 percent annualized
·  
Core transaction deposits up $81.2 million in first quarter, or 10 percent annualized
·  
Solid improvement in key credit quality measures



BLAIRSVILLE, GA – April 25, 2013 – United Community Banks, Inc. (NASDAQ: UCBI) today reported net income of $11.8 million, or 15 cents per share, for the first quarter of 2013.  The first quarter results reflect modest loan growth, improved credit quality, strong core transaction deposit growth, and lower operating expenses compared with the same period a year ago.

“We are off to a good start to what we expect to be another productive year,” said Jimmy Tallent, president and chief executive officer.  “The first quarter continued our trend of meaningful improvement in every key measure of credit quality.  We made particularly strong progress slowing nonperforming loan inflows which, at $9.67 million, were less than half the fourth quarter level.  Nonperforming assets were $113 million and 1.65 percent of total assets at the end of the first quarter.  That is down $15 million, or 12 percent, from the end of the fourth quarter, and down $49 million, or 30 percent, from a year ago.  Additionally, core transaction deposits increased by $81 million, or 10 percent annualized.”
 
 
 
 
 
Tallent continued, “We grew our loan portfolio by $19 million from the fourth quarter, for an annualized rate of 2 percent.  Achieving quality loan growth remains a challenge in what continues to be a sluggish economy.  We achieved this growth by bringing on new commercial lenders and by offering new retail loan products that are tailored to meet our customers’ financing needs at competitive rates.”

The first quarter provision for loan losses was $11 million, down $4 million from a year ago and $3 million from the fourth quarter.  First quarter net charge-offs were $12.4 million compared to $14.5 million in the fourth quarter and $15.9 million a year ago.

“The inflow of nonperforming loans was the lowest quarterly total since the beginning of the economic cycle,” Tallent said.  “The benefit of this trend, which we expect to continue, was clearly evident in our lower net charge-offs and provisioning.”

Taxable equivalent net interest revenue totaled $54.7 million, down $1.37 million from the fourth quarter and down $4.21 million from the first quarter a year ago.  “The decrease primarily reflects lower yields on our loan and investment securities portfolios,” said Tallent.  “The lower loan portfolio yield reflects ongoing pricing pressure on new and renewed loans, and new retail product offerings with low introductory rates.  The lower investment securities yield is due to reinvestment of cash flows at record low rates.  We continue to look for reinvestment opportunities, with a focus on floating-rate securities, to alleviate market and duration risk.  Floating-rate securities account for 34 percent of the investment securities portfolio, and improve our interest sensitivity position by reducing exposure to rising interest rates.  We would like a higher yield but will not go out on the curve to chase one.”

The taxable equivalent net interest margin was down six basis points from the fourth quarter, and 15 basis points from a year ago, to 3.38 percent.  “Our net interest margin will remain under pressure as long as interest rates remain at this unprecedented low level,” stated Tallent.  “To offset the impact on net interest revenue, we remain sharply focused on growing our loan portfolio in the mid-single digit range by focusing on retail loans and by continuing to add commercial lenders in key markets.”
 
 
 
 
 
First quarter fee revenue was $12.8 million, compared to $14.8 million in the fourth quarter and $15.4 million a year ago.  The decrease from the preceding quarter was primarily due to a slow-down in mortgage refinancing activity, a lower overdraft fee total related to transaction and activity levels, and an incentive in the fourth quarter from our debit card network services provider.  Closed mortgage loans totaled $69.8 million in the first quarter compared with $100 million in the fourth quarter and $81.7 million in the first quarter of 2012.  The decrease in other fee revenue compared to a year earlier was primarily due to two non-core items in the first quarter of 2012: a federal tax refund of $1.1 million and $728,000 in gains from the sale of low income housing tax credits.

Operating expenses, excluding foreclosed property costs and a $4 million fourth quarter charge for settlement of litigation, were $41.4 million in the first quarter of 2013 compared to $42.1 million for the fourth quarter of 2012 and $43.1 million a year ago.  The decrease from both periods was due to management’s efforts to reduce costs and operate more efficiently, primarily through reduction in staff levels and related costs.

Foreclosed property costs were $2.33 million in the first quarter of 2013, compared to $4.61 million in the fourth quarter of 2012 and $3.83 million a year ago.  First quarter 2013 costs included $1.19 million for maintenance and $1.15 million in net losses and write-downs.  For the fourth quarter of 2012, foreclosed property costs included $1.42 million in maintenance and $3.19 million in net losses and write-downs.  First quarter 2012 foreclosed property costs included $1.62 million in maintenance and $2.20 million in net losses and write-downs.

As of March 31, 2013, capital ratios were as follows: Tier 1 Risk-Based of 14.3 percent; Tier 1 Leverage of 9.7 percent; Total Risk-Based of 15.9 percent; Tier 1 Common Risk-Based of 8.9 percent; and, Tangible Equity-to-Assets of 8.5 percent.

“We know that challenges remain as the economy continues to struggle and interest rates are at record lows,” Tallent continued.  “Our focus is on growing net interest revenue by growing loans in a prudent and balanced manner, and pursuing opportunities to grow mortgage and advisory services market share.  The environment forces us to be more efficient and work smarter to achieve our goals, and this team is fully committed and up to the challenge.  We do expect continued improvement in credit measures that will translate into lower charge-off and provisioning levels.”

 
 
 
 
Tallent concluded, “We constantly look for ways to improve our financial performance by growing our business and improving operating efficiency, all while maintaining the best customer satisfaction scores in the industry.  We remain firmly committed to improving our financial results while delivering the best banking experience and growing shareholder value.”

Conference Call
United will hold a conference call today, Thursday, April 25, 2013, at 11 a.m. ET to discuss the contents of this news release and to share business highlights for the quarter.  To access the call, dial (877) 380-5665 and use the conference number 31826472.  The conference call also will be webcast and can be accessed by selecting ‘Calendar of Events’ within the Investor Relations section of United’s website at www.ucbi.com.

About United Community Banks, Inc.
Headquartered in Blairsville, United Community Banks, Inc. is the third-largest bank holding company in Georgia. United has assets of $6.8 billion and operates 103 banking offices throughout north Georgia, the Atlanta region, coastal Georgia, western North Carolina,  east Tennessee and northwest South Carolina.  United specializes in providing personalized community banking services to individuals and small to mid-size businesses and also offers the convenience of 24-hour access through a network of ATMs, telephone and on-line banking. United’s common stock is listed on the Nasdaq Global Select Market under the symbol UCBI.  Additional information may be found at United’s website at www.ucbi.com.

Safe Harbor
This news release contains forward-looking statements, as defined by federal securities laws, including statements about United’s financial outlook and business environment.  These statements are based on current expectations and are provided to assist in the understanding of future financial performance. Such performance involves risks and uncertainties that may cause actual results to differ materially from those expressed or implied in any such statements.  For a discussion of some of the risks and other factors that may cause such forward-looking statements to differ materially from actual results, please refer to United’s filings with the Securities and Exchange Commission including its 2012 Annual Report on Form 10-K under the sections entitled “Forward-Looking Statements” and “Risk Factors.” Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements.
 
# # #
 
 
 
 
 
UNITED COMMUNITY BANKS, INC.
                                
Financial Highlights
                                    
Selected Financial Information
                                
                                     
 
                                
First
  
   
2013
    
2012
    
Quarter
  
(in thousands, except per share
  
First
    
Fourth
    
Third
    
Second
    
First
     2013-2012  
data; taxable equivalent)
  
Quarter
    
Quarter
    
Quarter
    
Quarter
    
Quarter
    
Change
  
INCOME SUMMARY
                                      
Interest revenue
   $ 62,134     $ 64,450     $ 65,978     $ 66,780     $ 70,221          
Interest expense
     7,475       8,422       8,607       9,944       11,357          
    Net interest revenue
     54,659       56,028       57,371       56,836       58,864       (7 ) %
Provision for loan losses
     11,000       14,000       15,500       18,000       15,000          
Fee revenue
     12,826       14,761       13,764       12,867       15,379       (17 )
   Total revenue
     56,485       56,789       55,635       51,703       59,243          
Operating expenses
     43,770       50,726       44,783       44,310       46,955       (7 )
Income before income taxes
     12,715       6,063       10,852       7,393       12,288       3  
Income tax expense
     950       802       284       894       760          
Net income
     11,765       5,261       10,568       6,499       11,528       2  
Preferred dividends and discount accretion
     3,052       3,045       3,041       3,032       3,030          
Net income available to common shareholders
   $ 8,713     $ 2,216     $ 7,527     $ 3,467     $ 8,498       3  
                                                 
PERFORMANCE MEASURES
                                          
  Per common share:
                                                
    Diluted income
   $ .15     $ .04     $ .13     $ .06     $ .15       -  
    Book value
     6.85       6.67       6.75       6.61       6.68       3  
    Tangible book value (2)
     6.76       6.57       6.64       6.48       6.54       3  
                                                 
  Key performance ratios:
                                                
    Return on equity (1)(3)
     8.51 %     2.15 %     7.43 %     3.51 %     8.78   %      
    Return on assets (3)
     .70       .31       .63       .37       .66          
    Net interest margin (3)
     3.38       3.44       3.60       3.43       3.53          
    Efficiency ratio
     64.97       71.69       62.95       63.84       63.31          
    Equity to assets
     8.60       8.63       8.75       8.33       8.19          
    Tangible equity to assets (2)
     8.53       8.55       8.66       8.24       8.08          
    Tangible common equity to assets (2)
     5.66       5.67       5.73       5.45       5.33          
    Tangible common equity to risk-                                                
weighted assets (2)
     8.45       8.26       8.44       8.37       8.21          
                                                 
ASSET QUALITY *
                                                
  Non-performing loans
   $ 96,006     $ 109,894     $ 115,001     $ 115,340     $ 129,704          
  Foreclosed properties
     16,734       18,264       26,958       30,421       31,887          
    Total non-performing assets (NPAs)
     112,740       128,158       141,959       145,761       161,591          
  Allowance for loan losses
     105,753       107,137       107,642       112,705       113,601          
  Net charge-offs
     12,384       14,505       20,563       18,896       15,867          
  Allowance for loan losses to loans
     2.52 %     2.57 %     2.60 %     2.74 %     2.75   %      
  Net charge-offs to average loans (3)
     1.21       1.39       1.99       1.85       1.55          
  NPAs to loans and foreclosed                                                
  properties
     2.68       3.06       3.41       3.51       3.88          
  NPAs to total assets
     1.65       1.88       2.12       2.16       2.25          
 
                                                
AVERAGE BALANCES ($ in millions)
                                          
  Loans
   $ 4,197     $ 4,191     $ 4,147     $ 4,156     $ 4,168       1  
  Investment securities
     2,141       2,088       1,971       2,145       2,153       (1 )
  Earning assets
     6,547       6,482       6,346       6,665       6,700       (2 )
  Total assets
     6,834       6,778       6,648       6,993       7,045       (3 )
  Deposits
     5,946       5,873       5,789       5,853       6,028       (1 )
  Shareholders’ equity
     588       585       582       583       577       2  
  Common shares - basic (thousands)
     58,081       57,971       57,880       57,840       57,764          
  Common shares - diluted (thousands)
     58,081       57,971       57,880       57,840       57,764          
                                                 
AT PERIOD END ($ in millions)
                                          
  Loans *
   $ 4,194     $ 4,175     $ 4,138     $ 4,119     $ 4,128       2  
  Investment securities
     2,141       2,079       2,025       1,984       2,202       (3 )
  Total assets
     6,849       6,802       6,699       6,737       7,174       (5 )
  Deposits
     6,026       5,952       5,823       5,822       6,001       -  
  Shareholders’ equity
     592       581       585       576       580       2  
  Common shares outstanding (thousands)
     57,767       57,741       57,710       57,641       57,603          
                                                 
(1) Net income available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss). (2) Excludes effect of acquisition related intangibles and associated amortization. (3) Annualized.
 
* Excludes loans and foreclosed properties covered by loss sharing agreements with the FDIC.
 
 
 
 
UNITED COMMUNITY BANKS, INC.
                      
Non-GAAP Performance Measures Reconciliation
                      
Selected Financial Information
    
           
   
2013
    
2012
(in thousands, except per share
  
First
    
Fourth
    
Third
    
Second
    
First
  
data; taxable equivalent)
  
Quarter
    
Quarter
    
Quarter
    
Quarter
    
Quarter
  
                               
Interest revenue reconciliation
                              
Interest revenue - taxable equivalent
   $ 62,134     $ 64,450     $ 65,978     $ 66,780     $ 70,221  
Taxable equivalent adjustment
     (365 )     (381 )     (419 )     (444 )     (446 )
    Interest revenue (GAAP)
   $ 61,769     $ 64,069     $ 65,559     $ 66,336     $ 69,775  
                                         
Net interest revenue reconciliation
                                        
Net interest revenue - taxable equivalent
   $ 54,659     $ 56,028     $ 57,371     $ 56,836     $ 58,864  
Taxable equivalent adjustment
     (365 )     (381 )     (419 )     (444 )     (446 )
    Net interest revenue (GAAP)
   $ 54,294     $ 55,647     $ 56,952     $ 56,392     $ 58,418  
                                         
Total revenue reconciliation
                                        
Total operating revenue
   $ 56,485     $ 56,789     $ 55,635     $ 51,703     $ 59,243  
Taxable equivalent adjustment
     (365 )     (381 )     (419 )     (444 )     (446 )
    Total revenue (GAAP)
   $ 56,120     $ 56,408     $ 55,216     $ 51,259     $ 58,797  
                                         
Income before taxes reconciliation
                                        
Income before taxes
   $ 12,715     $ 6,063     $ 10,852     $ 7,393     $ 12,288  
Taxable equivalent adjustment
     (365 )     (381 )     (419 )     (444 )     (446 )
    Income before taxes (GAAP)
   $ 12,350     $ 5,682     $ 10,433     $ 6,949     $ 11,842  
                                         
Income tax expense reconciliation
                                        
Income tax expense
   $ 950     $ 802     $ 284     $ 894     $ 760  
Taxable equivalent adjustment
     (365 )     (381 )     (419 )     (444 )     (446 )
    Income tax expense (GAAP)
   $ 585     $ 421     $ (135 )   $ 450     $ 314  
                                         
Book value per common share reconciliation
                                        
Tangible book value per common share
   $ 6.76     $ 6.57     $ 6.64     $ 6.48     $ 6.54  
Effect of goodwill and other intangibles
     .09       .10       .11       .13       .14  
   Book value per common share (GAAP)
   $ 6.85     $ 6.67     $ 6.75     $ 6.61     $ 6.68  
                                         
Average equity to assets reconciliation
                                        
Tangible common equity to assets
     5.66 %     5.67 %     5.73 %     5.45 %     5.33 %
Effect of preferred equity
     2.87       2.88       2.93       2.79       2.75  
    Tangible equity to assets
     8.53       8.55       8.66       8.24       8.08  
Effect of goodwill and other intangibles
     .07       .08       .09       .09       .11  
    Equity to assets (GAAP)
     8.60 %     8.63 %     8.75 %     8.33 %     8.19 %
                                         
Tangible common equity to risk-weighted assets reconciliation
                          
Tangible common equity to risk-weighted assets
     8.45 %     8.26 %     8.44 %     8.37 %     8.21 %
Effect of other comprehensive income
     .49       .51       .36       .28       .10  
Effect of trust preferred
     1.15       1.15       1.17       1.19       1.15  
Effect of preferred equity
     4.22       4.24       4.29       4.35       4.23  
    Tier I capital ratio (Regulatory)
     14.31 %     14.16 %     14.26 %     14.19 %     13.69 %
 
 
 
 
 
UNITED COMMUNITY BANKS, INC.
                                
Financial Highlights
                                          
Loan Portfolio Composition at Period-End (1)
                          
                                           
   
2013
    
2012
  
Linked
    
Year over 
 
   
First
    
Fourth
    
Third
    
Second
    
First
     Quarter     Year  
(in millions)
  
Quarter
    
Quarter
    
Quarter
    
Quarter
    
Quarter
     Change     Change  
LOANS BY CATEGORY
                                          
Owner occupied commercial RE
   $ 1,130     $ 1,131     $ 1,126     $ 1,140     $ 1,137     $ (1 )   $ (7 )
Income producing commercial RE
     674       682       693       697       706       (8 )     (32 )
Commercial & industrial
     454       458       460       450       440       (4 )     14  
Commercial construction
     152       155       161       169       167       (3 )     (15 )
     Total commercial
     2,410       2,426       2,440       2,456       2,450       (16 )     (40 )
Residential mortgage
     850       829       833       834       836       21       14  
Home equity lines of credit
     396       385       341       294       295       11       101  
Residential construction
     372       382       389       409       436       (10 )     (64 )
Consumer installment
     166       153       135       126       111       13       55  
     Total loans
   $ 4,194     $ 4,175     $ 4,138     $ 4,119     $ 4,128       19       66  
                                                         
LOANS BY MARKET
                                                        
North Georgia
   $ 1,363     $ 1,364     $ 1,383     $ 1,387     $ 1,408       (1 )     (45 )
Atlanta MSA
     1,317       1,288       1,257       1,252       1,239       29       78  
North Carolina
     575       579       579       576       588       (4 )     (13 )
Coastal Georgia
     398       400       380       369       366       (2 )     32  
Gainesville MSA
     259       261       256       259       262       (2 )     (3 )
East Tennessee
     282       283       283       276       265       (1 )     17  
     Total loans
   $ 4,194     $ 4,175     $ 4,138     $ 4,119     $ 4,128       19       66  
                                                         
RESIDENTIAL CONSTRUCTION
                                                  
Dirt loans
                                                        
   Acquisition & development
   $ 57     $ 62     $ 71     $ 78     $ 86       (5 )     (29 )
   Land loans
     42       46       41       45       57       (4 )     (15 )
   Lot loans
     188       193       196       203       204       (5 )     (16 )
      Total
     287       301       308       326       347       (14 )     (60 )
                                                         
House loans
                                                        
   Spec
     40       41       44       49       57       (1 )     (17 )
   Sold
     45       40       37       34       32       5       13  
      Total
     85       81       81       83       89       4       (4 )
Total residential construction
   $ 372     $ 382     $ 389     $ 409     $ 436       (10 )     (64 )
                                                         
(1) Excludes total loans of $28.3 million, $33.4 million, $37.0 million, $41.5 million and $47.2 million as of March 31, 2013, December 31, 2012, September 30, 2012, June 30, 2012 and March 31, 2012, respectively, that are covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.
 
 
 
 
 
UNITED COMMUNITY BANKS, INC.
                                
Financial Highlights
                                        
Credit Quality (1)
                                            
 
   
First Quarter 2013
    
Fourth Quarter 2012
    
Third Quarter 2012
  
    Non-performing     Foreclosed    
Total
     Non-performing     Foreclosed     Total     Non-performing     Foreclosed    
Total
  
(in thousands)
  
Loans
     Properties    
NPAs
    
Loans
     Properties    
NPAs
    
Loans
     Properties    
NPAs
  
NPAs BY CATEGORY
                                                  
Owner occupied CRE
   $ 8,142     $ 4,750     $ 12,892     $ 12,599     $ 4,989     $ 17,588     $ 14,140     $ 7,170     $ 21,310  
Income producing CRE
     9,162       834       9,996       9,549       490       10,039       11,756       1,597       13,353  
Commercial & industrial
     29,545       -       29,545       31,817       -       31,817       32,678       -       32,678  
Commercial construction
     22,359       3,027       25,386       23,843       2,204       26,047       18,590       3,121       21,711  
     Total commercial
     69,208       8,611       77,819       77,808       7,683       85,491       77,164       11,888       89,052  
Residential mortgage
     10,901       3,463       14,364       11,151       4,753       15,904       12,629       6,031       18,660  
Home equity lines of credit
     916       -       916       1,438       -       1,438       1,367       -       1,367  
Residential construction
     14,592       4,660       19,252       18,702       5,828       24,530       22,935       9,039       31,974  
Consumer installment
     389       -       389       795       -       795       906       -       906  
     Total NPAs
   $ 96,006     $ 16,734     $ 112,740     $ 109,894     $ 18,264     $ 128,158     $ 115,001     $ 26,958     $ 141,959  
Balance as a % of
                                                                  
          Unpaid Principal
     66.3 %     45.0 %     62.0 %     69.5 %     39.7 %     62.8 %     68.8 %     36.4 %     58.8 %
                                                                         
NPAs BY MARKET
                                                                  
North Georgia
   $ 63,210     $ 6,616     $ 69,826     $ 69,950     $ 8,219     $ 78,169     $ 72,211     $ 14,582     $ 86,793  
Atlanta MSA
     17,380       3,524       20,904       18,556       3,442       21,998       21,349       5,926       27,275  
North Carolina
     8,519       2,533       11,052       11,014       2,579       13,593       9,622       2,771       12,393  
Coastal Georgia
     3,523       1,449       4,972       3,810       1,609       5,419       6,822       864       7,686  
Gainesville MSA
     911       370       1,281       903       556       1,459       840       1,328       2,168  
East Tennessee
     2,463       2,242       4,705       5,661       1,859       7,520       4,157       1,487       5,644  
     Total NPAs
   $ 96,006     $ 16,734     $ 112,740     $ 109,894     $ 18,264     $ 128,158     $ 115,001     $ 26,958     $ 141,959  
                                                                         
                                                                         
NPA ACTIVITY
                                                                        
Beginning Balance
   $ 109,894     $ 18,264     $ 128,158     $ 115,001     $ 26,958     $ 141,959     $ 115,340     $ 30,421     $ 145,761  
Loans placed on non-accrual
     9,665       -       9,665       20,211       -       20,211       30,535       -       30,535  
Payments received
     (6,809 )     -       (6,809 )     (6,458 )     -       (6,458 )     (3,646 )     -       (3,646 )
Loan charge-offs
     (10,456 )     -       (10,456 )     (11,722 )     -       (11,722 )     (19,227 )     -       (19,227 )
Foreclosures
     (6,288 )     6,288       -       (7,138 )     7,138       -       (8,001 )     8,001       -  
Capitalized costs
     -       54       54       -       201       201       -       102       102  
Note / property sales
     -       (6,726 )     (6,726 )     -       (12,845 )     (12,845 )     -       (8,822 )     (8,822 )
Write downs
     -       (1,041 )     (1,041 )     -       (1,438 )     (1,438 )     -       (2,394 )     (2,394 )
Net losses on sales
     -       (105 )     (105 )     -       (1,750 )     (1,750 )     -       (350 )     (350 )
     Ending Balance
   $ 96,006     $ 16,734     $ 112,740     $ 109,894     $ 18,264     $ 128,158     $ 115,001     $ 26,958     $ 141,959  
                                                                         
 
   
First Quarter 2013
  
Fourth Quarter 2012
  
Third Quarter 2012
                        
            Net Charge-       Net Charge-       Net Charge-                    
           
Offs to
          
Offs to
          
Offs to
                        
   
Net
    
Average
  
Net
    
Average
  
Net
    
Average
                        
(in thousands)
  
Charge-Offs
  
Loans (2)
  
Charge-Offs
    
Loans (2)
  
Charge-Offs
  
Loans (2)
                        
NET CHARGE-OFFS BY CATEGORY
                                                        
Owner occupied CRE
   $ 1,922       .69 %   $ 4,997       1.76 %   $ 6,192       3.56 %                        
Income producing CRE
     3,321       1.99       1,153       .67       1,982       .70                          
Commercial & industrial
     1,501       1.34       135       .12       (259 )     (.23 )                        
Commercial construction
     (4 )     (.01 )     1,688       4.25       3,190       7.74                          
     Total commercial
     6,740       1.14       7,973       1.30       11,105       1.81                          
Residential mortgage
     1,635       .79       3,254       1.55       2,846       1.40                          
Home equity lines of credit
     512       .53       445       .49       681       .80                          
Residential construction
     2,973       3.22       2,435       2.52       5,676       5.69                          
Consumer installment
     524       1.35       398       1.10       255       .78                          
     Total
   $ 12,384       1.21     $ 14,505       1.39     $ 20,563       1.99                          
                                                                         
                                                                         
NET CHARGE-OFFS BY MARKET
                                                          
North Georgia
   $ 4,910       1.42 %   $ 4,474       1.26 %   $ 6,451       1.84 %                        
Atlanta MSA
     3,295       1.07       3,977       1.27       9,344       3.02                          
North Carolina
     2,249       1.59       2,032       1.39       1,674       1.15                          
Coastal Georgia
     821       .85       574       .60       2,486       2.67                          
Gainesville MSA
     430       .67       1,331       2.04       294       .45                          
East Tennessee
     679       .98       2,117       2.98       314       .45                          
     Total
   $ 12,384       1.21     $ 14,505       1.39     $ 20,563       1.99                          
                                                                         
(1) Excludes non-performing loans and foreclosed properties covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank.
 
 
 
 
 
UNITED COMMUNITY BANKS, INC.
            
Consolidated Statement of Operations (Unaudited)
            
             
   
Three Months Ended
  
   
March 31,
  
(in thousands, except per share data)
  
2013
    
2012
  
             
Interest revenue:
            
Loans, including fees
   $ 50,934     $ 55,759  
Investment securities, including tax exempt of $212 and $250
     9,965       13,004  
Deposits in banks and short-term investments
     870       1,012  
Total interest revenue
     61,769       69,775  
                 
Interest expense:
                
Deposits:
                
NOW
     454       637  
Money market
     562       641  
Savings
     36       37  
Time
     3,226       6,159  
Total deposit interest expense
     4,278       7,474  
Short-term borrowings
     516       1,045  
Federal Home Loan Bank advances
     19       466  
Long-term debt
     2,662       2,372  
Total interest expense
     7,475       11,357  
Net interest revenue
     54,294       58,418  
Provision for loan losses
     11,000       15,000  
Net interest revenue after provision for loan losses
     43,294       43,418  
                 
Fee revenue:
                
Service charges and fees
     7,403       7,783  
Mortgage loan and other related fees
     2,655       2,099  
Brokerage fees
     767       813  
Securities gains, net
     116       557  
Loss from prepayment of debt
     -       (482 )
Other
     1,885       4,609  
Total fee revenue
     12,826       15,379  
Total revenue
     56,120       58,797  
                 
Operating expenses:
                
Salaries and employee benefits
     23,592       25,225  
Communications and equipment
     3,046       3,155  
Occupancy
     3,367       3,771  
Advertising and public relations
     938       846  
Postage, printing and supplies
     863       979  
Professional fees
     2,366       1,975  
Foreclosed property
     2,333       3,825  
FDIC assessments and other regulatory charges
     2,505       2,510  
Amortization of intangibles
     705       732  
Other
     4,055       3,937  
Total operating expenses
     43,770       46,955  
    Net income before income taxes
     12,350       11,842  
Income tax expense
     585       314  
Net income
     11,765       11,528  
Preferred stock dividends and discount accretion
     3,052       3,030  
Net income available to common shareholders
   $ 8,713     $ 8,498  
Earnings per common share - basic / diluted
   $ .15     $ .15  
Weighted average common shares outstanding - basic / diluted
     58,081       57,764  
 
 
 
 
 
 UNITED COMMUNITY BANKS, INC.
                  
 Consolidated Balance Sheet
                  
                   
   
March 31,
    
December 31,
    
March 31,
  
 (in thousands, except share and per share data)
  
2013
    
2012
    
2012
  
   
(unaudited)
    
(audited)
    
(audited)
  
 ASSETS
                  
   Cash and due from banks
   $ 57,638     $ 66,536     $ 53,147  
   Interest-bearing deposits in banks
     107,390       124,613       139,439  
   Short-term investments
     82,000       60,000       235,000  
       Cash and cash equivalents
     247,028       251,149       427,586  
   Securities available for sale
     1,909,426       1,834,593       1,898,815  
   Securities held to maturity (fair value $247,087, $261,131 and $318,490)
     231,087       244,184       303,636  
   Mortgage loans held for sale
     18,290       28,821       24,809  
   Loans, net of unearned income
     4,193,560       4,175,008       4,127,566  
        Less allowance for loan losses
     (105,753 )     (107,137 )     (113,601 )
               Loans, net
     4,087,807       4,067,871       4,013,965  
   Assets covered by loss sharing agreements with the FDIC
     42,096       47,467       72,854  
   Premises and equipment, net
     168,036       168,920       174,419  
   Bank owned life insurance
     82,114       81,867       80,956  
   Accrued interest receivable
     18,302       18,659       20,292  
   Goodwill and other intangible assets
     4,805       5,510       7,695  
   Foreclosed property
     16,734       18,264       31,887  
   Unsettled securities sales
     -       5,763       43,527  
   Other assets
     23,643       29,191       73,252  
       Total assets
   $ 6,849,368     $ 6,802,259     $ 7,173,693  
 LIABILITIES AND SHAREHOLDERS' EQUITY
                        
 Liabilities:
                        
   Deposits:
                        
        Demand
   $ 1,298,425     $ 1,252,605     $ 1,101,757  
        NOW
     1,281,454       1,316,453       1,389,016  
        Money market
     1,165,836       1,149,912       1,123,734  
        Savings
     243,347       227,308       214,150  
        Time:
                        
             Less than $100,000
     1,019,396       1,055,271       1,207,479  
             Greater than $100,000
     685,174       705,558       796,882  
        Brokered
     332,220       245,033       167,521  
                      Total deposits
     6,025,852       5,952,140       6,000,539  
    Short-term borrowings
     51,999       52,574       101,925  
    Federal Home Loan Bank advances
     125       40,125       215,125  
    Long-term debt
     124,825       124,805       120,245  
    Unsettled securities purchases
     -       -       119,565  
    Accrued expenses and other liabilities
     54,349       51,210       36,755  
         Total liabilities
     6,257,150       6,220,854       6,594,154  
 Shareholders' equity:
                        
     Preferred stock, $1 par value; 10,000,000 shares authorized;
                        
          Series A; $10 stated value; 21,700 shares issued and outstanding
     217       217       217  
          Series B; $1,000 stated value; 180,000 shares issued and outstanding
     178,937       178,557       177,451  
          Series D; $1,000 stated value; 16,613 shares issued and outstanding
     16,613       16,613       16,613  
     Common stock, $1 par value; 100,000,000 shares authorized;
                        
         43,063,761, 42,423,870 and 41,688,647 shares issued and outstanding
     43,064       42,424       41,689  
     Common stock, non-voting, $1 par value; 30,000,000 shares authorized;
                        
         14,703,636, 15,316,794 and 15,914,209 shares issued and outstanding
     14,704       15,317       15,914  
     Common stock issuable; 133,469, 133,238 and 90,126 shares
     2,726       3,119       2,948  
     Capital surplus
     1,059,222       1,057,951       1,056,135  
     Accumulated deficit
     (700,440 )     (709,153 )     (722,363 )
     Accumulated other comprehensive loss
     (22,825 )     (23,640 )     (9,065 )
         Total shareholders' equity
     592,218       581,405       579,539  
         Total liabilities and shareholders' equity
   $ 6,849,368     $ 6,802,259     $ 7,173,693  
 
 
 
 
 
UNITED COMMUNITY BANKS, INC.
                                    
Average Consolidated Balance Sheets and Net Interest Analysis
                          
For the Three Months Ended March 31,
                                    
                                     
    2013     2012  
   
Average
          
Avg.
    
Average
          
Avg.
  
(dollars in thousands, taxable equivalent)
  
Balance
    
Interest
    
Rate
    
Balance
    
Interest
    
Rate
  
Assets:
                                    
Interest-earning assets:
                                    
  Loans, net of unearned income (1)(2)
   $ 4,196,757     $ 50,999       4.93 %   $ 4,168,440     $ 55,842       5.39 %
  Taxable securities (3)
     2,119,085       9,753       1.84       2,127,794       12,754       2.40  
  Tax-exempt securities (1)(3)
     21,733       347       6.39       25,438       410       6.45  
  Federal funds sold and other interest-earning assets
     209,674       1,035       1.97       377,988       1,215       1.29  
                                                 
     Total interest-earning assets
     6,547,249       62,134       3.84       6,699,660       70,221       4.21  
Non-interest-earning assets:
                                                
  Allowance for loan losses
     (110,941 )                     (117,803 )                
  Cash and due from banks
     64,294                       54,664                  
  Premises and equipment
     169,280                       174,849                  
  Other assets (3)
     164,250                       233,676                  
     Total assets
   $ 6,834,132                     $ 7,045,046                  
                                                 
Liabilities and Shareholders' Equity:
                                                
Interest-bearing liabilities:
                                                
  Interest-bearing deposits:
                                                
NOW
   $ 1,303,308       454       .14     $ 1,458,112       637       .18  
Money market
     1,257,409       562       .18       1,069,658       641       .24  
Savings
     234,110       36       .06       205,402       37       .07  
Time less than $100,000
     1,039,707       1,749       .68       1,271,351       3,026       .96  
Time greater than $100,000
     694,553       1,477       .86       821,164       2,415       1.18  
Brokered time deposits
     175,128       -       .00       161,335       718       1.79  
       Total interest-bearing deposits
     4,704,215       4,278       .37       4,987,022       7,474       .60  
                                                 
Federal funds purchased and other borrowings
     72,157       516       2.90       102,258       1,045       4.11  
Federal Home Loan Bank advances
     33,069       19       .23       138,372       466       1.35  
Long-term debt
     124,816       2,662       8.65       120,237       2,372       7.93  
      Total borrowed funds
     230,042       3,197       5.64       360,867       3,883       4.33  
                                                 
      Total interest-bearing liabilities
     4,934,257       7,475       .61       5,347,889       11,357       .85  
Non-interest-bearing liabilities:
                                                
  Non-interest-bearing deposits
     1,241,527                       1,040,587                  
  Other liabilities
     70,839                       79,612                  
     Total liabilities
     6,246,623                       6,468,088                  
Shareholders' equity
     587,509                       576,958                  
     Total liabilities and shareholders' equity
   $ 6,834,132                     $ 7,045,046                  
                                                 
Net interest revenue
           $ 54,659                     $ 58,864          
Net interest-rate spread
                     3.23 %                     3.36 %
                                                 
Net interest margin (4)
                     3.38 %                     3.53 %
                                                   
(1) Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 39%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2) Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued and loans that are held for sale.
 Securities available for sale are shown at amortized cost. Pretax unrealized gains of $17.1 million in 2013 and $23.6 million in 2012 are included in other assets for purposes of this presentation.
(4) Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.