8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) September 17, 2010

UWHARRIE CAPITAL CORP

(Exact name of Registrant as specified in its charter)

NORTH CAROLINA	000-22062	56-1814206
(State or other jurisdiction of incorporation)	(Commission File No.)	(IRS Employer Identification number)

132 NORTH FIRST STREET, ALBEMARLE, NORTH CAROLINA 28001

(Address of principal executive offices)

Registrant’s telephone number, including area code (704) 982-4415

N/A

(Former address of principal executive offices)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On September 17, 2010, Uwharrie Capital Corp (the “Registrant”) released a quarterly report to its shareholders that included a letter to the shareholders from President and CEO Roger L. Dick and unaudited financial information for the period ended June 30, 2010. A copy of this report is attached hereto as Exhibit 99.1 and incorporated by reference herein.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(c) Exhibits

Exhibit No.	Description of Exhibit
99.1	Quarterly report to shareholders for the period ended June 30, 2010.

This Current Report on Form 8-K (including information included or incorporated by reference herein) may contain, among other things, certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements regarding certain of Registrant’s goals and expectations with respect to 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 that include 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 Registrant’s management and are subject to significant risks and uncertainties that are subject to change based on various factors (many of which are beyond Registrant’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.

UWHARRIE CAPITAL CORP
By:	/s/ Robert O. Bratton
	Robert O. Bratton
	Principal Financial Officer

Dated: September 17, 2010

EXHIBIT INDEX

Exhibit Number	Description of Exhibit
99.1	Quarterly report to shareholders for the period ended June 30, 2010.

EX-99.1

Exhibit 99.1

September 17, 2010

Uwharrie Capital Corp and its subsidiary banks continued to deliver solid results during the first half of 2010. Though we are living through what are certainly difficult and historic times, your family of community banks has continued to endure the storm. Not since the Great Depression have the economy, financial markets and banking industry been so stressed. With prudent underwriting, staying close to our customers and giving our clients solid financial guidance, Uwharrie Capital Corp continues to make significant market share gains that will strengthen our foundation for the future.

We value the confidence that our customers place in us and we work hard to earn that trust every day. One of the great factors behind our consistent growth is the level of care we give to our customers. Total assets ended the quarter at $515.0 million, an increase of $51.2 million or 11.0% compared to assets of $463.8 million at June 30, 2009. Loans increased 8.0% to $367.2 million and total deposits increased 10.2% to $409.9 million.

As of June 30, 2010, year to date net interest income was $9.3 million, an increase of $866 thousand, or 10.2% over the first six months of 2009. Net interest margin was 4.25%, an improvement from 4.09% for the same period of 2009.

While the soft economy continues to be difficult, we remain committed to assisting our customers in working through the challenges they face. We have taken steps to not only recognize current problems but to stay ahead of the curve if recovery is slower still. This position has impacted earnings for the first half of 2010.

Net income was $870 thousand for the six-month period ended June 30, 2010, compared to $1.528 million for the same period last year. Net income available to shareholders was $547 thousand for the six-month period compared to $1.206 million for the six-month period ending June 30, 2009. For the three months ending June 30, 2010, net income was $331 thousand, a decrease from $623 thousand for the same period last year. Net income available to shareholders was $170 thousand compared to $463 thousand last year.

Across the state and nation, banks continue to report less than stellar earnings and while ours are not as strong as the prior year, we have identified two primary contributing factors which we are managing proactively.

As loan loss trends continue, we have prudently increased our provision in recognition of the potential effect a sustained economic slowdown would have on our loan portfolio. We are thankful we are not experiencing the level of asset deterioration some financial intermediaries are facing this year, but we are not without some exposure to these market forces.

Additionally, revenue in 2009 benefited from unprecedented home refinancing in early 2009 which positively impacted income as the Company produced 1.5 times the volume of a normal year. This year home refinancing volume was lower in the first six months of 2010 compared to 2009, but represents more normalized volume.

Our business is based on building relationships rather than individual transactions and we are constantly focusing on strengthening the long-term partnership with our customers. We are seeing an increase of new customers transferring their relationships to our banks and wealth management services due to referrals from satisfied customers, our valued shareholders and our board members. Somewhat offsetting this favorable development are the continued financial challenges many local businesses and individual customers are facing, and the deflation of historic real estate values due to a lack of liquidity and economic confidence.

Your Company remains ‘well capitalized’ by regulatory standards and we are confident in our ability to accomplish our Mission and Vision of a self-supporting local economy. Once again, please “shop local” and patronize our local businesses – now more than ever. Thank you for your loyalty and confidence.

Sincerely,

UWHARRIE CAPITAL CORP

/s/ Roger L. Dick

Roger L. Dick

President and Chief Executive Officer

Uwharrie Capital Corp and Subsidiaries

Consolidated Balance Sheets

(Amounts in thousands except share and per share data)	June 30, 2010			June 30, 2009
Assets
Cash and due from banks	$	11,277		$	10,557
Investment securities available for sale		94,994			74,650
Federal funds sold		—			—
Loans held for sale		1,991			2,922
Loans held for investment		372,821			344,721
Less: Allowance for loan losses		5,635			4,732
Net loans held for investment		367,186			339,989
Interest receivable		2,416			1,987
Premises and equipment, net		14,127			12,863
Federal Home Loan Bank stock		3,330			3,147
Bank-owned life insurance		5,835			5,608
Goodwill		987			987
Other real estate owned		3,281			2,497
Other assets		9,612			8,629
Total assets	$	515,036		$	463,836
Liabilities
Deposits:
Demand, noninterest-bearing	$	50,651		$	47,206
Interest checking and money market accounts		167,874			118,932
Savings accounts		36,586			32,128
Time deposits, $100,000 and over		64,283			70,837
Other time deposits		90,494			102,681
Total deposits		409,888			371,784
Interest payable		389			487
Short-term borrowed funds		22,515			14,642
Long-term debt		33,589			30,648
Other liabilities		2,424			3,051
Total liabilities		468,805			420,612
Shareholders’ Equity
Preferred Stock, no par value: 10,000,000 shares authorized;
10,000 shares of series A issued and outstanding		10,000			10,000
500 shares of series B issued and outstanding		500			500
Discount on preferred stock		(350	)		(450	)
Common stock, $1.25 par value: 20,000,000 shares authorized; issued and outstanding or in process of issuance 7,593,929 and 7,593,929 shares, respectively.
Book value per share $4.75 in 2010 and $4.37 in 2009.		9,492			9,492
Additional paid-in capital		14,032			14,028
Unearned ESOP compensation		(629	)		(701	)
Undivided profits		10,603			11,214
Accumulated other comprehensive income (loss)		2,583			(859	)
Total shareholders’ equity		46,231			43,224
Total liabilities and shareholders’ equity	$	515,036		$	463,836

Uwharrie Capital Corp and Subsidiaries

Consolidated Statements of Income

	Three Months Ended June 30,						Six Months Ended June 30,
(Amounts in thousands except share and per share data)	2010			2009			2010			2009
Interest Income
Interest and fees on loans	$	5,492		$	5,218		$	10,794		$	10,593
Interest on investment securities		756			945			1,500			1,915
Other interest income		10			19			18			43
Total interest income		6,258			6,182			12,312			12,551
Interest Expense
Interest paid on deposits		1,048			1,557			2,132			3,165
Interest on borrowed funds		438			439			846			918
Total interest expense		1,486			1,996			2,978			4,083
Net Interest Income		4,772			4,186			9,334			8,468
Provision for loan losses		830			196			1,043			568
Net interest income after provision for loan losses		3,942			3,990			8,291			7,900
Noninterest Income
Service charges on deposit accounts		563			567			1,129			1,135
Other service fees and commissions		768			575			1,429			1,032
Gain (loss) on sale of securities		62			20			(36	)		(20	)
Loss on nonmarketable securities		—			—			—			(172	)
Total other-than-temporary impairment loss		—			(1,855	)		—			(1,855	)
Portion of loss recognized in other comprehensive income		—			1,651			—			1,651
Net impairment recognized in earnings		—			(204	)		—			(204	)
Income from mortgage loan sales		390			1,131			736			2,567
Other income		40			84			168			164
Total noninterest income		1,823			2,173			3,426			4,502
Noninterest Expense
Salaries and employee benefits		2,886			2,886			5,714			5,759
Occupancy expense		272			242			538			487
Equipment expense		176			180			358			361
Data processing		209			198			411			389
Other operating expenses		1,672			1,775			3,366			3,164
Total noninterest expense		5,215			5,281			10,387			10,160
Income before income taxes		550			882			1,330			2,242
Provision for income taxes		219			259			460			714
Net Income	$	331		$	623		$	870		$	1,528
Net Income	$	331		$	623		$	870		$	1,528
Dividends - preferred stock		(161	)		(160	)		(323	)		(322	)
Net income available to common shareholders	$	170		$	463		$	547		$	1,206
Net Income Per Common Share (1)
Basic	$	0.02		$	0.06		$	0.07		$	0.16
Assuming dilution	$	0.02		$	0.06		$	0.07		$	0.16
Weighted Average Common Shares Outstanding (1)
Basic		7,488,781			7,472,003			7,486,695			7,469,905
Assuming dilution		7,488,781			7,472,003			7,486,695			7,469,905