EX-99.1 2 t1500095_ex99-1.htm EXHIBIT 99.1

Exhibit 99.1

For Immediate Release

For more information:

Rex S. Schuette

Chief Financial Officer

(706) 781-2266

Rex_Schuette@ucbi.com

UNITED COMMUNITY BANKS, INC. REPORTS

NET INCOME OF $18.2 MILLION FOR FOURTH QUARTER 2014,

UP 15 PERCENT FROM A YEAR AGO

Earnings per diluted share of 30 cents, up 36 percent from fourth quarter of 2013

Loans up $103 million, or 9 percent annualized

Net interest margin stabilizes at 3.31 percent

Operating efficiency improves to 57.5 percent on strong revenue growth

BLAIRSVILLE, GA – January 21, 2015 – United Community Banks, Inc. (NASDAQ: UCBI) (“United”) today reported net income of $18.2 million, or 30 cents per diluted share, for the fourth quarter of 2014. Earnings per share were up 36 percent from a year ago. The increases reflect strong loan growth, a stable net interest margin and growth in fee revenue.

For the full year of 2014, United reported net income of $67.6 million, or $1.11 per diluted share.

“Our fourth quarter results mark a strong ending to a very good year,” said Jimmy Tallent, president and chief executive officer. “Strong loan growth and a steady net interest margin increased net interest revenue by $1.37 million over the third quarter. Our return on assets rose to 96 basis points, one basis point above the third quarter and closing in on our goal of 1 percent. Also, our return on equity was 9.6 percent, up 19 basis points from the third quarter and 208 basis points from a year ago. We continue to improve operating efficiency, and achieved solid positive operating leverage in the fourth quarter.”

Tallent continued, “Fourth quarter net loan growth of $103 million was driven by solid production across all of our markets. Our specialized lending business, which includes health care, corporate, SBA, asset-based and commercial real estate lending, was the largest contributor to our growth this quarter with $74.6 million. We also saw solid growth in our Coastal Georgia market.”

Fourth quarter taxable equivalent net interest revenue totaled $58.3 million, up $1.37 million from the third quarter and up $2.45 million from the fourth quarter of 2013. The taxable equivalent net interest margin was 3.31 percent, down one basis point from the third quarter but up five basis points from a year ago.

“Preserving our net interest margin and growing net interest revenue, while minimizing exposure to changes in interest rates, have been top priorities for growing earnings,” said Tallent. “We’ve been able to hold the margin steady in the low 3.30 percent range following our second quarter balance sheet management activities, which included restructuring the securities portfolio, interest rate hedges and wholesale borrowings. We expect our margin to remain at the current level into 2015.”

The fourth quarter provision for credit losses was $1.8 million, down $200,000 from the third quarter and down $1.2 million from the fourth quarter of 2013. Fourth quarter net charge-offs were $2.51 million compared with $3.16 million in the third quarter and $4.45 million a year ago. Nonperforming assets at quarter-end were $19.6 million, down 10 percent from the third quarter and 37 percent from a year ago. Nonperforming assets at quarter-end represented .26 percent of total assets, compared to .29 percent last quarter and .42 percent a year ago.

Fourth quarter fee revenue totaled $14.8 million, up $411,000 from the third quarter and $1.30 million from the fourth quarter of 2013. The increase from a year ago resulted primarily from the growing SBA lending business and related gains on sales of SBA loans. Gains totaled $926,000 in the fourth quarter of 2014, and $945,000 in the third quarter. There were no gains from SBA loan sales in the fourth quarter of 2013.

Service charges and fees, and debit card interchange fees, were up from both the third quarter of 2014 and the fourth quarter of 2013, more than offsetting a decline in overdraft fees. Mortgage fees were down $67,000 from the third quarter, but up $398,000 from a year ago. The increase from the fourth quarter of 2013 reflects United’s commitment to growing the mortgage business. Closed mortgage loans totaled $77.4 million in the fourth quarter compared with $84.2 million in the third quarter and $55.5 million in the fourth quarter of 2013.

Operating expenses were $41.9 million in the fourth quarter compared to $41.4 million in the third quarter and $41.6 million a year ago. The increase was mostly due to higher salaries and employee benefit costs for the respective periods of $900,000 and $1.8 million, respectively, reflecting investments in new businesses and markets, as well as higher production and performance incentives and $350,000 in severance costs for the fourth quarter 2014.

Other expense was up $1.3 million from the third quarter and $1.2 million from a year ago. The increase reflects a $492,000 charge for the reimbursement of claimed interest related to the first period of the company’s loss sharing agreement with the FDIC, as well as higher support costs associated with the increase in lending activity. Professional fees were lower this quarter due to the resolution and release of a $1.2 million litigation reserve related to a previously disclosed legal matter and FDIC assessment costs declined due to further improvement in credit measures. There were several non-core items in the quarter that were mostly offsetting, including the litigation reserve release, FDIC reimbursement of prior period interest and severance costs.

“Our focus on growing revenue while controlling costs is driving the improvement in operating efficiency and positive operating leverage,” Tallent said. “Our operating efficiency ratio improved to 57.5 percent in the fourth quarter, compared to 58.0 percent in the third quarter.”

At December 31, 2014, capital ratios were as follows: Tier 1 Risk-Based of 12.1 percent; Total Risk-Based of 13.3 percent; Tier 1 Common Risk-Based of 11.1 percent; and, Tier 1 Leverage of 8.7 percent.

“In 2014 we invested significantly in revenue generation while controlling operating costs,” Tallent said. “I am excited about 2015 as these investments hit their stride to grow our businesses that will drive earnings and shareholder returns. As always, we will continue to look for opportunities to invest in people.”

Conference Call

United will hold a conference call today, Thursday, January 21, 2015, 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 61257382. The conference call also will be webcast and available for replay for 30 days by selecting “Events and Presentations” within the Investor Relations section of United’s website at www.ucbi.com.

About United Community Banks, Inc.

United Community Banks, Inc. (UCBI) is a bank holding company based in Blairsville, Georgia, with $7.6 billion in assets. The company's banking subsidiary, United Community Bank, is one of the Southeast's largest full-service banks, operating 103 offices in Georgia, North Carolina, South Carolina and Tennessee. The bank specializes in personalized community banking services for individuals, small businesses and corporations. A full range of consumer and commercial banking services includes mortgage, advisory, treasury management and other products. National survey organizations consistently recognize United Community Bank for outstanding customer service. Additional information about the company and the bank's full range of products and services can be found 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 2013 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

	2014												2013						For the Twelve Months Ended December 31,
*(in thousands, except per share data; taxable equivalent)*	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter			Fourth Quarter 2014-2013 Change			2014			2013			YTD 2014-2013 Change
INCOME SUMMARY
Interest revenue	$	64,353		$	63,338		$	61,783		$	60,495		$	61,695					$	249,969		$	247,323
Interest expense		6,021			6,371			6,833			6,326			5,816						25,551			27,682
Net interest revenue		58,332			56,967			54,950			54,169			55,879			4	%		224,418			219,641			2	%
Provision for credit losses		1,800			2,000			2,200			2,500			3,000						8,500			65,500
Fee revenue		14,823			14,412			14,143			12,176			13,519			10			55,554			56,598			(2	)
Total revenue		71,355			69,379			66,893			63,845			66,398						271,472			210,739
Operating expenses		41,919			41,364			40,532			39,050			41,614			1			162,865			174,304			(7	)
Income before income taxes		29,436			28,015			26,361			24,795			24,784			19			108,607			36,435
Income tax expense (benefit)		11,189			10,399			10,004			9,395			8,873						40,987			(236,705	)
Net income		18,247			17,616			16,357			15,400			15,911			15			67,620			273,140
Preferred dividends and discount accretion		-			-			-			439			2,912						439			12,078
Net income available to common shareholders	$	18,247		$	17,616		$	16,357		$	14,961		$	12,999			40		$	67,181		$	261,062

PERFORMANCE MEASURES
Per common share:
Diluted income	$	.30		$	.29		$	.27		$	.25		$	.22			36		$	1.11		$	4.44
Book value		12.20			12.15			11.94			11.66			11.30			8			12.20			11.30			8
Tangible book value⁽²⁾		12.15			12.10			11.91			11.63			11.26			8			12.15			11.26			8

Key performance ratios:
Return on common equity⁽¹⁾⁽³⁾		9.60	%		9.41	%		8.99	%		8.64	%		7.52	%					9.17	%		46.72	%
Return on assets⁽³⁾		.96			.95			.88			.85			.86						.91			3.86
Net interest margin⁽³⁾		3.31			3.32			3.21			3.21			3.26						3.26			3.30
Efficiency ratio		57.47			57.96			58.65			59.05			60.02						58.26			63.14
Average equity to average assets		9.76			9.85			9.61			9.52			11.62						9.69			10.35
Average tangible equity to average assets⁽²⁾		9.72			9.83			9.58			9.50			11.59						9.67			10.31
Average tangible common equity to average assets⁽²⁾		9.72			9.83			9.58			9.22			8.99						9.60			7.55
Tangible common equity to risk- weighted assets⁽²⁾		13.82			14.10			13.92			13.63			13.18						13.82			13.17

ASSET QUALITY *
Non-performing loans	$	17,881		$	18,745		$	20,724		$	25,250		$	26,819					$	17,881		$	26,819
Foreclosed properties		1,726			3,146			2,969			5,594			4,221						1,726			4,221
Total non-performing assets (NPAs)		19,607			21,891			23,693			30,844			31,040						19,607			31,040
Allowance for loan losses		71,619			71,928			73,248			75,223			76,762						71,619			76,762
Net charge-offs		2,509			3,155			4,175			4,039			4,445						13,878			93,710
Allowance for loan losses to loans		1.53	%		1.57	%		1.66	%		1.73	%		1.77	%					1.53	%		1.77	%
Net charge-offs to average loans⁽³⁾		.22			.28			.38			.38			.41						.31			2.22
NPAs to loans and foreclosed properties		.42			.48			.54			.71			.72						.42			.72
NPAs to total assets		.26			.29			.32			.42			.42						.26			.42

AVERAGE BALANCES ($ in millions)
Loans	$	4,621		$	4,446		$	4,376		$	4,356		$	4,315			7		$	4,450		$	4,254			5
Investment securities		2,222			2,231			2,326			2,320			2,280			(3	)		2,274			2,190			4
Earning assets		7,013			6,820			6,861			6,827			6,823			3			6,880			6,649			3
Total assets		7,565			7,374			7,418			7,384			7,370			3			7,436			7,074			5
Deposits		6,383			6,143			6,187			6,197			6,190			3			6,228			6,027			3
Shareholders’ equity		738			726			713			703			856			(14	)		720			732			(2	)
Common shares - basic (thousands)		60,830			60,776			60,712			60,059			59,923						60,588			58,787
Common shares - diluted (thousands)		60,833			60,779			60,714			60,061			59,925						60,590			58,845

AT PERIOD END ($ in millions)
Loans *	$	4,672		$	4,569		$	4,410		$	4,356		$	4,329			8		$	4,672		$	4,329			8
Investment securities		2,198			2,222			2,190			2,302			2,312			(5	)		2,198			2,312			(5	)
Total assets		7,567			7,526			7,352			7,398			7,425			2			7,567			7,425			2
Deposits		6,327			6,241			6,164			6,248			6,202			2			6,327			6,202			2
Shareholders’ equity		740			736			722			704			796			(7	)		740			796			(7	)
Common shares outstanding (thousands)		60,259			60,248			60,139			60,092			59,432						60,259			59,432

⁽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.

Selected Financial Information

For the Years Ended December 31,


(in thousands, except per share data; taxable equivalent)	2014			2013			2012			2011			2010
INCOME SUMMARY
Net interest revenue	$	224,418		$	219,641		$	229,758		$	238,670		$	244,637
Operating provision for credit losses ⁽¹⁾		8,500			65,500			62,500			251,000			234,750
Operating fee revenue		55,554			56,598			56,112			44,907			46,963
Total operating revenue ⁽¹⁾		271,472			210,739			223,370			32,577			56,850
Operating expenses ⁽²⁾		162,865			174,304			186,774			261,599			242,952
Loss on sale of nonperforming assets		-			-			-			-			45,349
Operating income (loss) from continuing operations before taxes		108,607			36,435			36,596			(229,022	)		(231,451	)
Operating income taxes		40,987			(236,705	)		2,740			(2,276	)		73,218
Net operating income (loss) from continuing operations		67,620			273,140			33,856			(226,746	)		(304,669	)
Noncash goodwill impairment charges		-			-			-			-			(210,590	)
Fraud loss provision and subsequent recovery, net of tax benefit		-			-			-			-			11,750
Net income (loss) from discontinued operations		-			-			-			-			(101	)
Gain from sale of subsidiary, net of income taxes and selling costs		-			-			-			-			1,266
Net income (loss)		67,620			273,140			33,856			(226,746	)		(502,344	)
Preferred dividends and discount accretion		439			12,078			12,148			11,838			10,316
Net income (loss) available to common shareholders	$	67,181		$	261,062		$	21,708		$	(238,584	)	$	(512,660	)

PERFORMANCE MEASURES
Per common share:
Diluted operating earnings (loss) from continuing operations ⁽¹⁾⁽²⁾	$	1.11		$	4.44		$	.38		$	(5.97	)	$	(16.64	)
Diluted earnings (loss) from continuing operations		1.11			4.44			.38			(5.97	)		(27.15	)
Diluted earnings (loss)		1.11			4.44			.38			(5.97	)		(27.09	)
Cash dividends declared		.11			-			-			-			-
Book value		12.20			11.30			6.67			6.62			15.40
Tangible book value⁽⁴⁾		12.15			11.26			6.57			6.47			14.80

Key performance ratios:
Return on common equity ⁽³⁾		9.17	%		46.72	%		5.43	%		(93.57	)%		(85.08	)%
Return on assets		.91			3.86			.49			(3.15	)		(6.61	)
Net interest margin		3.26			3.30			3.51			3.52			3.59
Operating efficiency ratio from continuing operations ⁽²⁾		58.26			63.14			65.43			92.27			98.98
Average equity to average assets		9.69			10.35			8.47			7.75			10.77
Average tangible equity to average assets ⁽⁴⁾		9.67			10.31			8.38			7.62			8.88
Average tangible common equity to average assets ⁽⁴⁾		9.60			7.55			5.54			3.74			6.52
Tangible common equity to risk-weighted assets⁽⁴⁾		13.82			13.17			8.26			8.25			5.64

ASSET QUALITY *
Non-performing loans	$	17,881		$	26,819		$	109,894		$	127,479		$	179,094
Foreclosed properties		1,726			4,221			18,264			32,859			142,208
Total non-performing assets (NPAs)		19,607			31,040			128,158			160,338			321,302
Allowance for loan losses		71,619			76,762			107,137			114,468			174,695
Operating net charge-offs⁽¹⁾		13,879			93,710			69,831			311,227			215,657
Allowance for loan losses to loans		1.53	%		1.77	%		2.57	%		2.79	%		3.79	%
Operating net charge-offs to average loans⁽¹⁾		.31			2.22			1.69			7.33			4.42
NPAs to loans and foreclosed properties		.42			.72			3.06			3.87			6.77
NPAs to total assets		.26			.42			1.88			2.30			4.42

AVERAGE BALANCES ($ in millions)
Loans	$	4,450		$	4,254		$	4,166		$	4,307		$	4,961
Investment securities		2,274			2,190			2,089			1,999			1,453
Earning assets		6,880			6,649			6,547			6,785			6,822
Total assets		7,436			7,074			6,865			7,189			7,605
Deposits		6,228			6,027			5,885			6,275			6,373
Shareholders’ equity		720			732			582			557			819
Common shares - Basic (thousands)		60,588			58,787			57,857			39,943			18,925
Common shares - Diluted (thousands)		60,590			58,845			57,857			39,943			18,925

AT YEAR END ($ in millions)
Loans *	$	4,672		$	4,329		$	4,175		$	4,110		$	4,604
Investment securities		2,198			2,312			2,079			2,120			1,490
Total assets		7,567			7,425			6,802			6,983			7,276
Deposits		6,327			6,202			5,952			6,098			6,469
Shareholders’ equity		740			796			581			575			469
Common shares outstanding (thousands)		60,259			59,432			57,741			57,561			18,937

⁽¹⁾ Excludes the subsequent recovery of $11.8 million in previously recognized fraud related loan losses in 2010. ⁽²⁾ Excludes goodwill impairment charge of $211 million in 2010. ⁽³⁾ Net income (loss) available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss). ⁽⁴⁾ Excludes effect of acquisition related intangibles and associated amortization.

* 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

	2014												2013			For the Twelve Months Ended December 31,
(in thousands, except per share data; taxable equivalent)	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Fourth Quarter			2014			2013			2012			2011			2010

Interest revenue reconciliation
Interest revenue - taxable equivalent	$	64,353		$	63,338		$	61,783		$	60,495		$	61,695		$	249,969		$	247,323		$	267,667		$	304,308		$	344,493
Taxable equivalent adjustment		(398	)		(405	)		(377	)		(357	)		(380	)		(1,537	)		(1,483	)		(1,690	)		(1,707	)		(2,001	)
Interest revenue (GAAP)	$	63,955		$	62,933		$	61,406		$	60,138		$	61,315		$	248,432		$	245,840		$	265,977		$	302,601		$	342,492

Net interest revenue reconciliation
Net interest revenue - taxable equivalent	$	58,332		$	56,967		$	54,950		$	54,169		$	55,879		$	224,418		$	219,641		$	229,758		$	238,670		$	244,637
Taxable equivalent adjustment		(398	)		(405	)		(377	)		(357	)		(380	)		(1,537	)		(1,483	)		(1,690	)		(1,707	)		(2,001	)
Net interest revenue (GAAP)	$	57,934		$	56,562		$	54,573		$	53,812		$	55,499		$	222,881		$	218,158		$	228,068		$	236,963		$	242,636

Provision for credit losses reconciliation
Operating provision for credit losses	$	1,800		$	2,000		$	2,200		$	2,500		$	3,000		$	8,500		$	65,500		$	62,500		$	251,000		$	234,750
Partial recovery of special fraud-related loan loss		-			-			-			-			-			-			-			-			-			(11,750	)
Provision for credit losses (GAAP)	$	1,800		$	2,000		$	2,200		$	2,500		$	3,000		$	8,500		$	65,500		$	62,500		$	251,000		$	223,000

Total revenue reconciliation
Total operating revenue	$	71,355		$	69,379		$	66,893		$	63,845		$	66,398		$	271,472		$	210,739		$	223,370		$	32,577		$	56,850
Taxable equivalent adjustment		(398	)		(405	)		(377	)		(357	)		(380	)		(1,537	)		(1,483	)		(1,690	)		(1,707	)		(2,001	)
Partial recovery of special fraud-related loan loss		-			-			-			-			-			-			-			-			-			11,750
Total revenue (GAAP)	$	70,957		$	68,974		$	66,516		$	63,488		$	66,018		$	269,935		$	209,256		$	221,680		$	30,870		$	66,599

Expense reconciliation
Operating expense	$	41,919		$	41,364		$	40,532		$	39,050		$	41,614		$	162,865		$	174,304		$	186,774		$	261,599		$	288,301
Noncash goodwill impairment charge		-			-			-			-			-			-			-			-			-			210,590
Operating expense (GAAP)	$	41,919		$	41,364		$	40,532		$	39,050		$	41,614		$	162,865		$	174,304		$	186,774		$	261,599		$	498,891

Income before taxes reconciliation
Income before taxes	$	29,436		$	28,015		$	26,361		$	24,795		$	24,784		$	108,607		$	36,435		$	36,596		$	(229,022	)	$	(231,451	)
Taxable equivalent adjustment		(398	)		(405	)		(377	)		(357	)		(380	)		(1,537	)		(1,483	)		(1,690	)		(1,707	)		(2,001	)
Noncash goodwill impairment charge		-			-			-			-			-			-			-			-			-			(210,590	)
Partial recovery of special fraud-related loan loss		-			-			-			-			-			-			-			-			-			11,750
Income before taxes (GAAP)	$	29,038		$	27,610		$	25,984		$	24,438		$	24,404		$	107,070		$	34,952		$	34,906		$	(230,729	)	$	(432,292	)

Income tax expense (benefit) reconciliation
Income tax expense (benefit)	$	11,189		$	10,399		$	10,004		$	9,395		$	8,873		$	40,987		$	(236,705	)	$	2,740		$	(2,276	)	$	73,218
Taxable equivalent adjustment		(398	)		(405	)		(377	)		(357	)		(380	)		(1,537	)		(1,483	)		(1,690	)		(1,707	)		(2,001	)
Income tax expense (benefit) (GAAP)	$	10,791		$	9,994		$	9,627		$	9,038		$	8,493		$	39,450		$	(238,188	)	$	1,050		$	(3,983	)	$	71,217

Diluted earnings (loss) from continuing operations per common share reconciliation
Diluted operating earnings (loss) from continuing operations per common share	$	.30		$	.29		$	.27		$	.25		$	.22		$	1.11		$	4.44		$	.38		$	(5.97	)	$	(16.64	)
Noncash goodwill impairment charge		-			-			-			-			-			-			-			-			-			(11.13	)
Partial recovery of special fraud-related loan loss		-			-			-			-			-			-			-			-			-			.62
Diluted earnings (loss) from continuing operations per common share (GAAP)	$	.30		$	.29		$	.27		$	.25		$	.22		$	1.11		$	4.44		$	.38		$	(5.97	)	$	(27.15	)

Book value per common share reconciliation
Tangible book value per common share	$	12.15		$	12.10		$	11.91		$	11.63		$	11.26		$	12.15		$	11.26		$	6.57		$	6.47		$	14.80
Effect of goodwill and other intangibles		.05			.05			.03			.03			.04			.05			.04			.10			.15			.60
Book value per common share (GAAP)	$	12.20		$	12.15		$	11.94		$	11.66		$	11.30		$	12.20		$	11.30		$	6.67		$	6.62		$	15.40

Efficiency ratio from continuing operations reconciliation
Operating efficiency ratio from continuing operations		57.47	%		57.96	%		58.65	%		59.05	%		60.02	%		58.26	%		63.14	%		65.43	%		92.27	%		98.98	%
Noncash goodwill impairment charge		-			-			-			-			-			-			-			-			-			72.29
Efficiency ratio from continuing operations (GAAP)		57.47	%		57.96	%		58.65	%		59.05	%		60.02	%		58.26	%		63.14	%		65.43	%		92.27	%		171.27	%

Average equity to assets reconciliation
Tangible common equity to assets		9.72	%		9.83	%		9.58	%		9.22	%		8.99	%		9.60	%		7.55	%		5.54	%		3.74	%		6.52	%
Effect of preferred equity		-			-			-			.28			2.60			.07			2.76			2.84			3.88			2.36
Tangible equity to assets		9.72			9.83			9.58			9.50			11.59			9.67			10.31			8.38			7.62			8.88
Effect of goodwill and other intangibles		.04			.02			.03			.02			.03			.02			.04			.09			.13			1.89
Equity to assets (GAAP)		9.76	%		9.85	%		9.61	%		9.52	%		11.62	%		9.69	%		10.35	%		8.47	%		7.75	%		10.77	%

Tangible common equity to risk-weighted assets reconciliation
Tangible common equity to risk-weighted assets		13.82	%		14.10	%		13.92	%		13.63	%		13.18	%		13.82	%		13.18	%		8.26	%		8.25	%		5.64	%
Effect of other comprehensive income		.35			.34			.53			.36			.39			.35			.39			.51			(.03	)		(.42	)
Effect of deferred tax limitation		(3.11	)		(3.39	)		(3.74	)		(3.92	)		(4.26	)		(3.11	)		(4.26	)		-			-			-
Effect of trust preferred		1.00			1.02			1.04			1.03			1.04			1.00			1.04			1.15			1.18			1.06
Effect of preferred equity		-			-			-			-			2.39			-			2.39			4.24			4.29			3.53
Tier I capital ratio (Regulatory)		12.06	%		12.07	%		11.75	%		11.10	%		12.74	%		12.06	%		12.74	%		14.16	%		13.69	%		9.81	%

Net charge-offs reconciliation
Operating net charge-offs	$	2,509		$	3,155		$	4,175		$	4,039		$	4,445		$	13,878		$	93,710		$	69,831		$	311,227		$	215,657
Subsequent partial recovery of fraud-related charge-off		-			-			-			-			-			-			-			-			-			(11,750	)
Net charge-offs (GAAP)	$	2,509		$	3,155		$	4,175		$	4,039		$	4,445		$	13,878		$	93,710		$	69,831		$	311,227		$	203,907

Net charge-offs to average loans reconciliation
Operating net charge-offs to average loans		.22	%		.28	%		.38	%		.38	%		.41	%		.31	%		2.22	%		1.69	%		7.33	%		4.42	%
Subsequent partial recovery of fraud-related charge-off		-			-			-			-			-			-			-			-			-			(.25	)
Net charge-offs to average loans (GAAP)		.22	%		.28	%		.38	%		.38	%		.41	%		.31	%		2.22	%		1.69	%		7.33	%		4.17	%

UNITED COMMUNITY BANKS, INC.

Financial Highlights

Loan Portfolio Composition at Period-End ⁽¹⁾

	2014								2013		Linked			Year over
	Fourth		Third		Second		First		Fourth		Quarter			Year
(in millions)	Quarter		Quarter		Quarter		Quarter		Quarter		Change			Change
LOANS BY CATEGORY
Owner occupied commercial RE	$	1,163	$	1,153	$	1,163	$	1,142	$	1,134	$	10		$	29
Income producing commercial RE		599		605		598		624		623		(6	)		(24	)
Commercial & industrial		710		650		554		495		472		60			238
Commercial construction		196		181		160		148		149		15			47
Total commercial		2,668		2,589		2,475		2,409		2,378		79			290
Residential mortgage		866		866		861		866		875		-			(9	)
Home equity lines of credit		466		459		451		447		441		7			25
Residential construction		299		307		302		318		328		(8	)		(29	)
Consumer installment		373		348		321		316		307		25			66
Total loans	$	4,672	$	4,569	$	4,410	$	4,356	$	4,329		103			343

LOANS BY MARKET
North Georgia	$	1,163	$	1,168	$	1,175	$	1,205	$	1,240		(5	)		(77	)
Atlanta MSA		1,282		1,289		1,305		1,290		1,275		(7	)		7
North Carolina		553		553		555		563		572		-			(19	)
Coastal Georgia		456		444		426		425		423		12			33
Gainesville MSA		257		254		257		262		255		3			2
East Tennessee		280		281		270		272		280		(1	)		-
South Carolina / Corporate		412		337		206		131		88		75			324
Other ⁽²⁾		269		243		216		208		196		26			73
Total loans	$	4,672	$	4,569	$	4,410	$	4,356	$	4,329		103			343

⁽¹⁾ Excludes total loans of $2.8 million, $2.8 million, $3.1 million, $19.3 million and $20.3 million as of December 31, 2014, September 30, 2014, June 30, 2014, March 31, 2014 and December 31, 2013, respectively, that are covered by the loss-sharing agreement with the FDIC, related to the acquisition of Southern Community Bank. ⁽²⁾ Includes purchased indirect auto loans that are not assigned to a geographic region.

UNITED COMMUNITY BANKS, INC.

Financial Highlights

Loan Portfolio Composition at Year-End ⁽¹⁾

(in millions)	2014		2013		2012		2011		2010
LOANS BY CATEGORY
Owner occupied commercial RE	$	1,163	$	1,134	$	1,131	$	1,112	$	980
Income producing commercial RE		599		623		682		710		781
Commercial & industrial		710		472		458		428		441
Commercial construction		196		149		155		164		297
Total commercial		2,668		2,378		2,426		2,414		2,499
Residential mortgage		866		875		829		835		944
Home equity lines of credit		466		441		385		300		335
Residential construction		299		328		382		448		695
Consumer / installment		373		307		153		113		131
Total loans	$	4,672	$	4,329	$	4,175	$	4,110	$	4,604


LOANS BY MARKET
North Georgia	$	1,163	$	1,240	$	1,364	$	1,426	$	1,689
Atlanta MSA		1,282		1,275		1,250		1,220		1,310
North Carolina		553		572		579		597		702
Coastal Georgia		456		423		400		346		335
Gainesville MSA		257		255		261		265		312
East Tennessee		280		280		283		256		256
South Carolina / Corporate		412		88		-		-		-
Other ⁽²⁾		269		196		38		-		-
Total loans	$	4,672	$	4,329	$	4,175	$	4,110	$	4,604

⁽¹⁾ Excludes total loans of $2.8 million, $20.3 million, $33.4 million, $54.5 million and $68.2 million as of December 31, 2014, 2013, 2012, 2011 and 2010, respectively, that are covered by loss-sharing agreements with the FDIC, related to the acquisition of Southern Community Bank. ⁽²⁾ Includes purchased indirect auto loans that are not assigned to a geographic region.

UNITED COMMUNITY BANKS, INC.

Financial Highlights

Credit Quality ⁽¹⁾

	Fourth Quarter 2014									Third Quarter 2014									Second Quarter 2014
	Non-performing			Foreclosed			Total			Non-performing			Foreclosed			Total			Non-performing			Foreclosed			Total
*(in thousands)*	Loans			Properties			NPAs			Loans			Properties			NPAs			Loans			Properties			NPAs
NONPERFORMING ASSETS BY CATEGORY
Owner occupied CRE	$	4,133		$	355		$	4,488		$	2,156		$	1,024		$	3,180		$	2,975		$	653		$	3,628
Income producing CRE		717			-			717			1,742			42			1,784			1,032			242			1,274
Commercial & industrial		1,571			-			1,571			1,593			-			1,593			1,102			-			1,102
Commercial construction		83			15			98			148			-			148			95			-			95
Total commercial		6,504			370			6,874			5,639			1,066			6,705			5,204			895			6,099
Residential mortgage		8,196			1,183			9,379			8,350			1,769			10,119			10,201			1,426			11,627
Home equity lines of credit		695			40			735			720			90			810			510			128			638
Residential construction		2,006			133			2,139			3,543			221			3,764			4,248			520			4,768
Consumer installment		480			-			480			493			-			493			561			-			561
Total NPAs	$	17,881		$	1,726		$	19,607		$	18,745		$	3,146		$	21,891		$	20,724		$	2,969		$	23,693
Balance as a % of
Unpaid Principal		69.9	%		54.1	%		68.1	%		68.6	%		54.5	%		66.1	%		66.5	%		50.4	%		63.9	%

NONPERFORMING ASSETS BY MARKET
North Georgia	$	5,669		$	711		$	6,380		$	7,392		$	1,717		$	9,109		$	8,216		$	1,392		$	9,608
Atlanta MSA		1,837			372			2,209			1,724			364			2,088			3,883			510			4,393
North Carolina		5,221			234			5,455			4,919			398			5,317			5,314			615			5,929
Coastal Georgia		799			105			904			781			160			941			782			80			862
Gainesville MSA		1,310			81			1,391			1,403			85			1,488			921			49			970
East Tennessee		1,414			201			1,615			1,227			245			1,472			1,218			323			1,541
South Carolina / Corporate		1,285			22			1,307			945			177			1,122			-			-			-
Other ⁽³⁾		346			-			346			354			-			354			390			-			390
Total NPAs	$	17,881		$	1,726		$	19,607		$	18,745		$	3,146		$	21,891		$	20,724		$	2,969		$	23,693

NONPERFORMING ASSETS ACTIVITY
Beginning Balance	$	18,745		$	3,146		$	21,891		$	20,724		$	2,969		$	23,693		$	25,250		$	5,594		$	30,844
Loans placed on non-accrual		7,140			-			7,140			7,665			-			7,665			9,529			-			9,529
Payments received		(5,286	)		-			(5,286	)		(3,129	)		-			(3,129	)		(4,027	)		-			(4,027	)
Loan charge-offs		(1,841	)		-			(1,841	)		(4,353	)		-			(4,353	)		(8,341	)		-			(8,341	)
Foreclosures		(877	)		877			-			(2,162	)		2,162			-			(1,687	)		1,687			-
Capitalized costs		-			-			-			-			209			209			-			-			-
Property sales		-			(2,483	)		(2,483	)		-			(2,350	)		(2,350	)		-			(4,430	)		(4,430	)
Write downs		-			(1	)		(1	)		-			(108	)		(108	)		-			(305	)		(305	)
Net gains (losses) on sales		-			187			187			-			264			264			-			423			423
Ending Balance	$	17,881		$	1,726		$	19,607		$	18,745		$	3,146		$	21,891		$	20,724		$	2,969		$	23,693

	Fourth Quarter 2014						Third Quarter 2014						Second Quarter 2014
				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	$	891			.31	%	$	746			.26	%	$	(1,836	)		(.64	)%
Income producing CRE		143			.09			104			.07			435			.29
Commercial & industrial		(295	)		(.17	)		(341	)		(.23	)		662			.52
Commercial construction		(6	)		(.01	)		103			.24			131			.34
Total commercial		733			.11			612			.10			(608	)		(.10	)
Residential mortgage		1,226			.56			1,116			.52			2,509			1.17
Home equity lines of credit		238			.20			356			.31			466			.42
Residential construction		(44	)		(.06	)		712			.94			1,671			2.13
Consumer installment		356			.39			359			.43			137			.18
Total	$	2,509			.22		$	3,155			.28		$	4,175			.38

NET CHARGE-OFFS BY MARKET
North Georgia	$	791			.27	%	$	1,861			.63	%	$	(741	)		(.25	)%
Atlanta MSA		147			.05			(250	)		(.08	)		1,481			.46
North Carolina		1,103			.79			656			.47			2,161			1.55
Coastal Georgia		30			.03			228			.21			116			.11
Gainesville MSA		94			.15			259			.40			797			1.23
East Tennessee		54			.08			230			.33			288			.42
South Carolina / Corporate		110			.11			5			.01			-			-
Other ⁽³⁾		180			.29			166			.31			73			.14
Total	$	2,509			.22		$	3,155			.28		$	4,175			.38

⁽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.

⁽²⁾

Annualized.

⁽³⁾

Includes purchased indirect auto loans that are not assigned to a geographic region.

UNITED COMMUNITY BANKS, INC.

Consolidated Statement of Income (Unaudited)

	Three Months Ended				Twelve Months Ended
	December 31,				December 31,
(in thousands, except per share data)	2014		2013		2014			2013

Interest revenue:
Loans, including fees	$	50,677	$	49,066	$	196,279		$	200,893
Investment securities, including tax exempt of $180, $203, $738 and $827		12,375		11,253		48,493			41,158
Deposits in banks and short-term investments		903		996		3,660			3,789
Total interest revenue		63,955		61,315		248,432			245,840

Interest expense:
Deposits:
NOW		435		473		1,651			1,759
Money market		868		569		3,060			2,210
Savings		20		24		81			133
Time		1,623		1,593		7,133			10,464
Total deposit interest expense		2,946		2,659		11,925			14,566
Short-term borrowings		96		508		2,160			2,071
Federal Home Loan Bank advances		339		3		912			68
Long-term debt		2,640		2,646		10,554			10,977
Total interest expense		6,021		5,816		25,551			27,682
Net interest revenue		57,934		55,499		222,881			218,158
Provision for credit losses		1,800		3,000		8,500			65,500
Net interest revenue after provision for credit losses		56,134		52,499		214,381			152,658

Fee revenue:
Service charges and fees		8,446		8,166		33,073			31,997
Mortgage loan and other related fees		2,111		1,713		7,520			9,925
Brokerage fees		1,176		1,361		4,807			4,465
Securities gains, net		208		70		4,871			186
Loss from prepayment of debt		-		-		(4,446	)		-
Other		2,882		2,209		9,729			10,025
Total fee revenue		14,823		13,519		55,554			56,598
Total revenue		70,957		66,018		269,935			209,256

Operating expenses:
Salaries and employee benefits		26,592		24,817		100,941			96,233
Communications and equipment		3,153		3,414		12,523			13,233
Occupancy		3,448		3,735		13,513			13,930
Advertising and public relations		802		781		3,461			3,718
Postage, printing and supplies		1,086		882		3,542			3,283
Professional fees		834		2,102		6,707			9,617
Foreclosed property		131		191		634			7,869
FDIC assessments and other regulatory charges		883		1,804		4,792			9,219
Amortization of intangibles		287		408		1,348			2,031
Other		4,703		3,480		15,404			15,171
Total operating expenses		41,919		41,614		162,865			174,304
Net income before income taxes		29,038		24,404		107,070			34,952
Income tax expense (benefit)		10,791		8,493		39,450			(238,188	)
Net income		18,247		15,911		67,620			273,140
Preferred stock dividends and discount accretion		-		2,912		439			12,078
Net income available to common shareholders	$	18,247	$	12,999	$	67,181		$	261,062

Earnings per common share:
Basic	$	.30	$	.22	$	1.11		$	4.44
Diluted		.30		.22		1.11			4.44
Weighted average common shares outstanding:
Basic		60,830		59,923		60,588			58,787
Diluted		60,833		59,925		60,590			58,845

UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheet (Unaudited)

	December 31,			December 31,
(in thousands, except share and per share data)	2014			2013

ASSETS
Cash and due from banks	$	77,180		$	71,230
Interest-bearing deposits in banks		89,074			119,669
Short-term investments		26,401			37,999
Cash and cash equivalents		192,655			228,898
Securities available for sale		1,782,734			1,832,217
Securities held to maturity (fair value $425,233 and $485,585)		415,267			479,742
Mortgage loans held for sale		13,737			10,319
Loans, net of unearned income		4,672,119			4,329,266
Less allowance for loan losses		(71,619	)		(76,762	)
Loans, net		4,600,500			4,252,504
Assets covered by loss sharing agreements with the FDIC		3,315			22,882
Premises and equipment, net		159,390			163,589
Bank owned life insurance		81,294			80,670
Accrued interest receivable		20,103			19,598
Goodwill and other intangible assets		3,641			3,480
Foreclosed property		1,726			4,221
Net deferred tax asset		215,503			258,518
Derivative financial instruments		20,599			23,833
Other assets		56,522			44,948
Total assets	$	7,566,986		$	7,425,419
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Demand	$	1,574,317		$	1,388,512
NOW		1,504,887			1,427,939
Money market		1,273,283			1,227,575
Savings		292,308			251,125
Time:
Less than $100,000		748,478			892,961
Greater than $100,000		508,228			588,689
Brokered		425,011			424,704
Total deposits		6,326,512			6,201,505
Repurchase agreements		6,000			53,241
Federal Home Loan Bank advances		270,125			120,125
Long-term debt		129,865			129,865
Derivative financial instruments		31,997			46,232
Unsettled securities purchases		5,425			29,562
Accrued expenses and other liabilities		57,485			49,174
Total liabilities		6,827,409			6,629,704
Shareholders' equity:
Preferred stock, $1 par value; 10,000,000 shares authorized;
Series B; $1,000 stated value; 0, 105,000 and 180,000 shares issued and outstanding		-			105,000
Series D; $1,000 stated value; 0, 16,613 and 16,613 shares issued and outstanding		-			16,613
Common stock, $1 par value; 100,000,000 shares authorized;
50,178,605 and 46,243,345 shares issued and outstanding		50,178			46,243
Common stock, non-voting, $1 par value; 26,000,000 shares authorized;
10,080,787 and 13,188,206 shares issued and outstanding		10,081			13,188
Common stock issuable; 357,983 and 241,832 shares		5,168			3,930
Capital surplus		1,080,508			1,078,676
Accumulated deficit		(387,568	)		(448,091	)
Accumulated other comprehensive loss		(18,790	)		(19,844	)
Total shareholders' equity		739,577			795,715
Total liabilities and shareholders' equity	$	7,566,986		$	7,425,419

UNITED COMMUNITY BANKS, INC.

Average Consolidated Balance Sheets and Net Interest Analysis

For the Three Months Ended December 31,

	2014								2013
	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⁾	$	4,620,517		$	50,883		4.37	%	$	4,315,370		$	49,205			4.52	%
Taxable securities ⁽³⁾		2,202,986			12,195		2.21			2,258,938			11,050			1.96
Tax-exempt securities ⁽¹⁾⁽³⁾		18,579			295		6.35			20,681			332			6.42
Federal funds sold and other interest-earning assets		170,703			980		2.30			227,622			1,108			1.95
Total interest-earning assets		7,012,785			64,353		3.65			6,822,611			61,695			3.59
Non-interest-earning assets:
Allowance for loan losses		(72,534	)							(81,335	)
Cash and due from banks		73,973								61,083
Premises and equipment		160,049								165,286
Other assets ⁽³⁾		391,097								402,328
Total assets	$	7,565,370							$	7,369,973
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW	$	1,481,414			435		.12		$	1,372,367			473			.14
Money market		1,433,680			868		.24			1,367,589			569			.17
Savings		291,163			20		.03			250,418			24			.04
Time less than $100,000		761,850			814		.42			907,042			1,164			.51
Time greater than $100,000		520,937			763		.58			604,490			1,029			.68
Brokered time deposits		273,706			46		.07			271,490			(600	)		(.88	)
Total interest-bearing deposits		4,762,750			2,946		.25			4,773,396			2,659			.22
Federal funds purchased and other borrowings		24,750			96		1.54			54,839			508			3.68
Federal Home Loan Bank advances		193,549			339		.69			6,647			3			.18
Long-term debt		129,865			2,640		8.07			129,865			2,646			8.08
Total borrowed funds		348,164			3,075		3.50			191,351			3,157			6.55
Total interest-bearing liabilities		5,110,914			6,021		.47			4,964,747			5,816			.46
Non-interest-bearing liabilities:
Non-interest-bearing deposits		1,620,635								1,416,483
Other liabilities		95,679								132,557
Total liabilities		6,827,228								6,513,787
Shareholders' equity		738,142								856,186
Total liabilities and shareholders' equity	$	7,565,370							$	7,369,973
Net interest revenue				$	58,332							$	55,879
Net interest-rate spread							3.18	%								3.13	%
Net interest margin ⁽⁴⁾							3.31	%								3.26	%

⁽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.

⁽³⁾

Securities available for sale are shown at amortized cost. Pretax unrealized gains of $8.59 million in 2014 and pretax unrealized losses of $6.33 million in 2013 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.

UNITED COMMUNITY BANKS, INC.

Average Consolidated Balance Sheets and Net Interest Analysis

For the Twelve Months Ended December 31,

	2014								2013
	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⁾	$	4,450,268		$	197,039		4.43	%	$	4,254,159		$	201,278			4.73	%
Taxable securities ⁽³⁾		2,255,084			47,755		2.12			2,169,024			40,331			1.86
Tax-exempt securities ⁽¹⁾⁽³⁾		19,279			1,209		6.27			21,228			1,354			6.38
Federal funds sold and other interest-earning assets		155,803			3,966		2.55			204,303			4,360			2.13
Total interest-earning assets		6,880,434			249,969		3.63			6,648,714			247,323			3.72
Non-interest-earning assets:
Allowance for loan losses		(75,237	)							(95,411	)
Cash and due from banks		67,818								63,174
Premises and equipment		161,391								167,424
Other assets ⁽³⁾		401,240								290,098
Total assets	$	7,435,646							$	7,073,999
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW	$	1,396,373			1,651		.12		$	1,285,842			1,759			.14
Money market		1,389,837			3,060		.22			1,315,385			2,210			.17
Savings		277,351			81		.03			244,725			133			.05
Time less than $100,000		811,846			3,636		.45			974,470			5,850			.60
Time greater than $100,000		551,027			3,373		.61			654,102			5,115			.78
Brokered time deposits		293,657			124		.04			219,215			(501	)		(.23	)
Total interest-bearing deposits		4,720,091			11,925		.25			4,693,739			14,566			.31
Federal funds purchased and other borrowings		74,541			2,160		2.90			66,561			2,071			3.11
Federal Home Loan Bank advances		175,481			912		.52			32,604			68			.21
Long-term debt		129,865			10,554		8.13			131,081			10,977			8.37
Total borrowed funds		379,887			13,626		3.59			230,246			13,116			5.70
Total interest-bearing liabilities		5,099,978			25,551		.50			4,923,985			27,682			.56
Non-interest-bearing liabilities:
Non-interest-bearing deposits		1,507,944								1,333,199
Other liabilities		107,523								84,506
Total liabilities		6,715,445								6,341,690
Shareholders' equity		720,201								732,309
Total liabilities and shareholders' equity	$	7,435,646							$	7,073,999
Net interest revenue				$	224,418							$	219,641
Net interest-rate spread							3.13	%								3.16	%
Net interest margin ⁽⁴⁾							3.26	%								3.30	%

⁽¹⁾

⁽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.

⁽³⁾

Securities available for sale are shown at amortized cost. Pretax unrealized gains of $3.36 million in 2014 and pretax unrealized gains of $4.36 million in 2013 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.