8-K

UNITED STATES

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): April 21, 2008

THE COLONIAL BANCGROUP, INC.

(Exact name of registrant as specified in its charter)

DELAWARE	1-13508	63-0661573
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)

100 Colonial Bank Blvd.

Montgomery, Alabama 36117

(Address of principal executive offices)

(334) 676-5000

(Registrant’s telephone number)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

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

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

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

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

Item 2.02 Results of Operations and Financial Condition.

Item 7.01 Regulation FD Disclosure

Information regarding the Registrant’s earnings results for the quarter ended March 31, 2008 is furnished herein pursuant to Item 2.02 of this Current Report and as Regulation FD Disclosure and is attached hereto as Exhibits 99.1 and 99.2 and is incorporated herein by reference.

As set forth in the press release announcing first quarter earnings, on April 21, 2008, The Colonial BancGroup, Inc. (BancGroup) also announced that it declared a quarterly dividend of $0.095 per share of common stock. The dividend will be payable on May 9, 2008 to shareholders of record as of the close of business on April 25, 2008. The press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

As set forth in a separate press release, on April 21, 2008, BancGroup also announced that it will issue 25 million shares of its common stock in an underwritten registered offering. The press release is attached hereto as Exhibit 99.3 and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

The following exhibits are furnished as Regulation FD Disclosure to this Current Report on Form 8-K:

Exhibit No.	Exhibit
99.1	Press release announcing first quarter earnings and the declaration of the quarterly common stock dividend.
99.2	Presentation materials to be used in connection with BancGroup’s conference call to be held on April 21, 2008.
99.3	Press release announcing BancGroup’s common stock offering.

This report includes “forward-looking statements” within the meaning of the federal securities laws. Words such as “believes,” “estimates,” “plans,” “expects,” “should,” “may,” “might,” “outlook,” “potential” and “anticipates,” the negative of these terms and similar expressions, as they relate to The Colonial BancGroup, Inc. (BancGroup) (including its subsidiaries or its management), are intended to identify forward-looking statements. The forward-looking statements in this report are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by such statements. In addition to factors mentioned elsewhere in this report or previously disclosed in BancGroup’s SEC reports (accessible on the SEC’s website at www.sec.gov or on BancGroup’s website at www.colonialbank.com), the following factors, among others, could cause actual results to differ materially from forward-looking statements, and future results could differ materially from historical performance. These factors are not exclusive:

• losses to our loan portfolio are greater than estimated or expected;

• an inability to raise additional capital on terms and conditions that are satisfactory;

• the impact of current economic conditions on our ability to borrow additional funds to meet our liquidity needs;

• economic conditions affecting real estate values and transactions in BancGroup’s market and/or general economic conditions, either nationally or regionally, that are less favorable then expected;

• changes in the interest rate environment which expand or reduce margins or adversely affect critical estimates as applied and projected returns on investments;

• deposit attrition, customer loss, or revenue loss in the ordinary course of business;

• increases in competitive pressure in the banking industry and from non-banks;

• costs or difficulties related to the integration of the businesses of BancGroup and institutions it acquires are greater than expected;

• the inability of BancGroup to realize elements of its strategic plans for 2008 and beyond;

• natural disasters in BancGroup’s primary market areas result in prolonged business disruption or materially impair the value of collateral securing loans;

• management’s assumptions and estimates underlying critical accounting policies prove to be inadequate or materially incorrect or are not borne out by subsequent events;

• the impact of recent and future federal and state regulatory changes;

• current and future litigation, regulatory investigations, proceedings or inquiries;

• strategies to manage interest rate risk may yield results other than those anticipated;

• changes which may occur in the regulatory environment;

• a significant rate of inflation (deflation);

• acts of terrorism or war; and

• changes in the securities markets.

Many of these factors are beyond BancGroup’s control. The reader is cautioned not to place undue reliance on any forward looking statements made by or on behalf of BancGroup. Any such statement speaks only as of the date the statement was made or as of such date that may be referenced within the statement. BancGroup does not undertake any obligation to update or revise any forward-looking statements.

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SIGNATURE

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.

THE COLONIAL BANCGROUP, INC
By	/s/    SARAH H. MOORE
	Sarah H. Moore
	Senior Executive Vice President and Chief Financial Officer

Date: April 21, 2008

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EX-99.1

Exhibit 99.1

PRESS RELEASE

For more information contact:	April 21, 2008
Lisa Free
(334) 676-5105

COLONIAL BANCGROUP REPORTS 1^st QUARTER EARNINGS

SUMMARY OF 1^st QUARTER 2008 RESULTS:

• Earnings per share of $0.16 for the 1^st quarter, an increase of $0.10 over the 4^th quarter 2007 and a decrease of $0.08 from the 1^st quarter 2007

• $34 million in net charge-offs or 0.84% annualized of average loans for the 1^st quarter, down from 0.88% of average loans in the 4^th quarter 2007

• Provision for loan loss was $35.5 million, down from $93 million in the 4^th quarter 2007; loan loss reserve was 1.50% of net loans at 12/31/07 and 3/31/08

• Nonperforming assets ratio was 1.65% at 3/31/08 compared to 0.86% at 12/31/07 and 0.22% at 3/31/07

• Net interest margin of 2.94% for the 1^st quarter was down 49 basis points from the 4^th quarter 2007 and down 52 basis points from the 1^st quarter 2007

• Average deposit growth of 17% over the 1^st quarter 2007 and 38% annualized over the 4^th quarter 2007

• Core noninterest income growth of 11% over the 1^st quarter 2007; decrease from the 4^th quarter 2007 by 10%

• Solid capital ratios at 3/31/08, Tier I at 8.05%, Total Capital at 12.01% and Leverage at 6.10%

• Issued $250 million of 8.875% subordinated debt

• Total assets of $27 billion at 3/31/08

• Declared quarterly common dividend of $0.095 per share

MONTGOMERY, Ala. - (NYSE: CNB) The Colonial BancGroup, Inc. Chairman, CEO and President, Robert E. Lowder, announced today that the Company’s earnings for the quarter ended March 31, 2008 were $0.16 per diluted share. “I am happy to report that we earned $0.16 per share in the first quarter despite the challenging operating environment for all financial institutions. Our continued profitability is evidence of our ability to deal with a difficult credit environment while continuing to focus on our core business. Over the years, Colonial has weathered many credit cycles. The experience we have gained as we navigated through market downturns has prepared us for the current issues that we face as a Company. As we have stated many times, while Colonial is not immune to the current economic conditions and we expect adverse conditions to continue through the remainder of 2008, we believe that we have identified the problems and those problems are centered in our residential real estate construction portfolio. We are pleased to report that, to date, we have not seen significant declining credit quality trends in the commercial real estate, consumer or C&I portfolios,” said Mr. Lowder.

Colonial also announced today that it will issue common equity in a public offering and will reduce its dividend in order to fortify its balance sheet in this unprecedented period of industry-wide credit losses. Though the Company would remain well-capitalized independent of the offering, the issuance is a proactive and prudent step to allow it to continue its aggressive loan work out efforts while maintaining healthy capital ratios. In addition, illiquid capital markets have resulted in temporary mark-to-market adjustments on Colonial’s highly-rated investment securities portfolio which do not reflect the portfolio’s underlying performance but negatively impact tangible common equity.

“A lesson learned from our prior experiences in times similar to these is the importance of being proactive in a challenging environment. During the first quarter, Colonial issued $250 million of subordinated debt which qualifies as regulatory capital. The common stock offering will provide more capital than would be required to remain well-capitalized even under very severe credit scenarios,” said Mr. Lowder. “Finally, the offering positions us well to create long-term shareholder value when the environment improves.”

The reduction of Colonial’s dividend is part of Colonial’s capital management plan. The dividend reduction will preserve upwards of $60 million of capital annually. “Our decision to reduce our common dividend was not taken lightly. However, we concluded it was the right long-term decision for shareholders because the persistent uncertainties of the current environment demand that we proceed cautiously with respect to capital,” said Mr. Lowder.

Colonial’s net charge-offs were $33.6 million, or 0.84% annualized of average loans, for the first quarter of 2008, down from 0.88% annualized for the fourth quarter of 2007. The nonperforming assets ratio at March 31, 2008 was 1.65% of period-end loans compared to 0.86% at December 31, 2007, reflecting both the continued deterioration in the Company’s residential real estate construction portfolio and the Company’s decision to work out many of its nonperforming loans rather than sell them at a deep discount to their intrinsic value. Colonial’s loan loss provision of $35.5 million exceeded net charge-offs by $2 million, increasing the loan loss reserve to $241 million. The loan loss reserve at March 31, 2008 was 1.50% of period-end loans.

Total loans were $16.1 billion at March 31, 2008 compared to $15.9 billion at December 31, 2007. Construction loans declined by $117 million, or 7% annualized, which was offset by an increase in mortgage warehouse loans.

“We have taken steps to strengthen Colonial’s position. We have systematically identified and isolated problematic credits, created a bankwide loan monitoring process that ends with me, and dedicated highly experienced, skilled people to the task of resolving individual credit situations. We’ve further strengthened our underwriting criteria to include lower loan to value ratios on residential property types, tightened credit criteria for consumer loan products and implemented increased risk based pricing across all lending lines.”

“While we are concentrating on the things that deserve extra care and attention right now, we continue to find that, even in the discouraging times, there are opportunities. So, as demand for loans has diminished, we have focused our loan officers on growing low cost deposits by partnering with the retail branch employees to call on commercial customers. This campaign has been successful as indicated in our deposit growth statistics in the first quarter. Growth in deposits has helped to improve our already strong liquidity position,” said Mr. Lowder.

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Average deposits for the first quarter of 2008 increased 38% annualized from the fourth quarter of 2007 and 17% from the first quarter of 2007. Average retail deposit growth for the first quarter was 9% annualized over the fourth quarter, excluding brokered deposits and the impact of the acquisition of Citrus & Chemical Bancorporation.

Core noninterest income for the first quarter of 2008 increased 11% over the first quarter of 2007. “Another example of our opportunistic approach to the current market cycle occurred in late 2007 when Colonial took advantage of the disruption in the mortgage banking market and hired a team of experienced prime mortgage originators. As a result, mortgage banking fees increased $3.6 million, or 112%, over the first quarter of 2007,” said Mr. Lowder. Colonial’s financial planning services fee income, which increased $990,000, or 26%, over the first quarter of 2007, was also a contributor to noninterest income growth. Annuity sales, a key generator of financial planning services revenue, and fees from increased activity in the fixed income trading area, led to significant growth in financial planning services fee income. The strong fee increases were partially offset by a $6 million, or 86%, decrease in mortgage warehouse fees.

Core noninterest expense increased in the first quarter of 2008 by 12% over the fourth quarter of 2007 due to one full quarter of Citrus & Chemical expenses versus one month in the fourth quarter, seasonal increases in payroll taxes and benefits, increased sub-servicing expenses related to increased mortgage warehouse assets and the cost of FDIC insurance. Colonial’s core noninterest expense to average assets ratio was 2.28% for the first quarter of 2008 compared to 2.22% for the fourth quarter of 2007.

Net interest income declined by $13.6 million from the fourth quarter of 2007 as the Company’s net interest margin contracted by 49 basis points in the quarter. The rapid reductions in the prime and LIBOR rates in the first quarter repriced approximately half of the Company’s loan portfolio. Deposit costs did not decline in tandem with the decline in prime and LIBOR rates due to intense competition for deposit dollars from financial services companies as a result of the illiquid capital markets.

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“If there is a silver lining in this credit cycle, it is that Colonial is prepared to tackle the tough times because of the decisions we made in the good times. With the help of the market insight provided by our local management and boards of directors, we detected signs of overbuilding in certain parts of Florida in 2006. Earlier, we saw the signs of potential weakness in the Miami condominium market. In response, we pulled back on new residential development lending and implemented a moratorium on new high rise condominium development loans. These forward thinking strategies are what Colonial has relied upon and will continue to utilize in order to maintain our position of strength and stability in uncertain times,” concluded Mr. Lowder.

Colonial BancGroup operates 342 branches in Florida, Alabama, Georgia, Nevada and Texas with approximately $27 billion in assets. The Company’s common stock is traded on the New York Stock Exchange under the symbol CNB and is located online at www.colonialbank.com. In some newspapers, the stock is listed as ColBgp.

4

Colonial’s management will host a conference call on April 21, 2008 at 9:00 AM/ET to discuss the earnings results for the first quarter of 2008. Individuals are encouraged to listen to the live webcast of the presentation as well as view a slide presentation by visiting Colonial’s website at www.colonialbank.com. The webcast will be hosted under “Events and Presentations” located under the “Investor Relations” section of the website. To participate in the Q&A session of the conference call, dial (877)397-0300 or (719)325-4864 Toll International, (Leader: Lisa Free).

A replay of the conference call will be available beginning at 12:00 PM/ET on April 21, 2008 and ending at midnight on April 26, 2008 by dialing (888) 203-1112 (Domestic Toll-Free) or (719) 457-0820 (Toll International). The passcode for both numbers is 1764761.

This release includes “forward-looking statements” within the meaning of the federal securities laws. Words such as “believes,” “estimates,” “plans,” “expects,” “should,” “may,” “might,” “outlook,” “potential” and “anticipates,” the negative of these terms and similar expressions, as they relate to The Colonial BancGroup, Inc. (BancGroup) (including its subsidiaries or its management), are intended to identify forward-looking statements. The forward-looking statements in this release are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by such statements. In addition to factors mentioned elsewhere in this release or previously disclosed in BancGroup’s SEC reports (accessible on the SEC’s website at www.sec.gov or on BancGroup’s website at www.colonialbank.com), the following factors, among others, could cause actual results to differ materially from forward-looking statements and future results could differ materially from historical performance. These factors are not exclusive:

• losses to our loan portfolio are greater than estimated or expected;

• an inability to raise additional capital on terms and conditions that are satisfactory;

• the impact of current economic conditions on our ability to borrow additional funds to meet our liquidity needs;

• economic conditions affecting real estate values and transactions in BancGroup’s market and/or general economic conditions, either nationally or regionally, that are less favorable then expected;

• changes in the interest rate environment which expand or reduce margins or adversely affect critical estimates as applied and projected returns on investments;

• deposit attrition, customer loss, or revenue loss in the ordinary course of business;

• increases in competitive pressure in the banking industry and from non-banks;

• costs or difficulties related to the integration of the businesses of BancGroup and institutions it acquires are greater than expected;

• the inability of BancGroup to realize elements of its strategic plans for 2008 and beyond;

• natural disasters in BancGroup’s primary market areas which result in prolonged business disruption or materially impair the value of collateral securing loans;

• management’s assumptions and estimates underlying critical accounting policies prove to be inadequate or materially incorrect or are not borne out by subsequent events;

• the impact of recent and future federal and state regulatory changes;

• current and future litigation, regulatory investigations, proceedings or inquiries;

• strategies to manage interest rate risk may yield results other than those anticipated;

• changes which may occur in the regulatory environment;

• a significant rate of inflation (deflation);

• acts of terrorism or war; and

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• changes in the securities markets.

Many of these factors are beyond BancGroup’s control. The reader is cautioned not to place undue reliance on any forward looking statements made by or on behalf of BancGroup. Any such statement speaks only as of the date the statement was made or as of such date that may be referenced within the statement. BancGroup does not undertake any obligation to update or revise any forward-looking statements.

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THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES

FINANCIAL HIGHLIGHTS (Unaudited)

Statement of Condition Summary

(Dollars in millions)	Mar 31, 2008		Dec 31, 2007		%Change Dec ‘07 to Mar ‘08
Total assets	$	27,353	$	25,976	5	%
Loans, net of unearned income		16,094		15,923	1	%
Total securities		3,495		3,683	-5	%
Non-time deposits		9,578		9,772	-2	%
Total deposits		19,271		18,544	4	%
Shareholders’ equity		2,172		2,274	-4	%

Earnings Summary

	Three Months Ended								Three Months Ended
(In thousands, except per share amounts)	Mar 31, 2008			Dec 31, 2007			% Change Dec ‘07 to Mar ‘08		Mar 31, 2008			Mar 31, 2007			% Change Mar 31, ‘07 to ‘08
Net Income:
Net interest income	$	181,624		$	195,201		-7	%	$	181,624		$	179,945		1	%
Provision for loan losses		35,543			93,295		-62	%		35,543			2,250		1480	%
Core noninterest income (1)		51,672			57,316		-10	%		51,672			46,394		11	%
Securities and derivatives gains, net		6,075			1,950		212	%		6,075			981		519	%
Securities restructuring charges		—			—		—			—			(36,006	)	100	%
Gain on sale of mortgage loans		—			—		—			—			3,850		-100	%
Total noninterest income		57,747			59,266		-3	%		57,747			15,219		279	%
Core noninterest expense (1)		157,810			140,814		12	%		157,810			130,291		21	%
Severance expense		236			2,571		-91	%		236			3,025		-92	%
Merger related expenses		—			1,717		-100	%		—			429		-100	%
Net losses related to the early extinguishment of debt		5,932			—		100	%		5,932			4,396		35	%
Total noninterest expense		163,978			145,102		13	%		163,978			138,141		19	%
Minority interest expense/REIT preferred dividends		5,336			5,336		—			5,336			—		100	%
Income before tax		34,514			10,734		222	%		34,514			54,773		-37	%
Income tax		9,717			1,762		451	%		9,717			18,294		-47	%
Net Income	$	24,797		$	8,972		176	%	$	24,797		$	36,479		-32	%
EARNINGS PER SHARE - DILUTED	$	0.16		$	0.06		167	%	$	0.16		$	0.24		-33	%
Average diluted shares outstanding		157,528			154,532					157,528			153,450
KEY RATIOS:
Net interest margin		2.94	%		3.43	%	-14	%		2.94	%		3.46	%	-15	%
Book value per share	$	13.74		$	14.44		-5	%	$	13.74		$	13.71		—
Book value per share excluding unrealized gain(loss) on AFS securities	$	14.39		$	14.46		—		$	14.39		$	13.72		5	%
Dividends paid per share	$	0.19		$	0.1875		1	%	$	0.19		$	0.1875		1	%

(1) Represents non-GAAP measures.

THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

Earnings Summary

(Dollars in thousands)	1st Qtr. 2008		4th Qtr. 2007		3rd Qtr. 2007		2nd Qtr. 2007		1st Qtr. 2007
Net interest income	$	181,624	$	195,201	$	196,011	$	190,217	$	179,945
Provision for loan loss		35,543		93,295		4,800		6,105		2,250
Noninterest income:
Service charges on deposit accounts		19,228		19,717		19,376		18,694		17,679
Electronic banking		5,004		4,843		4,923		4,648		4,401
Other retail banking fees		2,548		2,614		2,794		3,255		3,612
Retail banking fees		26,780		27,174		27,093		26,597		25,692
Financial planning services		4,812		4,123		4,506		4,283		3,822
Mortgage banking origination and sales		6,760		4,840		3,236		3,660		3,187
Mortgage warehouse fees		995		3,017		5,936		6,332		6,955
Bank-owned life insurance		5,120		5,203		5,070		5,002		4,955
Other income		7,205		12,959		7,117		6,891		1,783
Core noninterest income		51,672		57,316		52,958		52,765		46,394
Securities and derivatives gains, net		6,075		1,950		—		1,116		981
Securities restructuring charges		—		—		—		—		(36,006	)
Gain on sale of mortgage loans		—		—		—		—		3,850
Gain on sale of merchant services		—		—		—		4,900		—
Total noninterest income		57,747		59,266		52,958		58,781		15,219
Noninterest expense:
Salaries and employee benefits		73,667		70,900		68,345		70,256		69,554
Occupancy expense of bank premises, net		23,055		21,848		19,634		18,722		18,505
Furniture and equipment expense		14,703		13,564		13,226		13,350		13,122
Professional services		5,638		5,092		4,967		4,628		4,100
FDIC insurance and other regulatory fees		4,562		2,129		1,727		1,232		1,213
Electronic banking and other retail banking expenses		4,157		4,175		5,766		5,507		4,212
Amortization of intangible assets		4,163		3,606		3,500		3,201		3,051
Communications		2,819		2,531		2,677		2,900		2,991
Loss on equity investments		2,747		1,434		660		670		255
Loan and other real estate related costs		2,649		1,376		1,170		898		338
Postage and courier		2,622		2,736		2,589		2,692		2,639
Advertising		2,603		2,597		1,570		3,683		2,215
Travel		1,439		1,670		1,586		1,950		1,739
Other expense		12,986		7,156		6,281		7,647		6,357
Core noninterest expense		157,810		140,814		133,698		137,336		130,291
Severance expense		236		2,571		500		520		3,025
Merger related expenses		—		1,717		753		1,116		429
Net losses related to the early extinguishment of debt		5,932		—		—		2,512		4,396
Total noninterest expense		163,978		145,102		134,951		141,484		138,141
Minority interest expense/REIT preferred dividends		5,336		5,336		5,336		2,312		—
Income before tax		34,514		10,734		103,882		99,097		54,773
Income tax		9,717		1,762		34,527		32,978		18,294
Net Income	$	24,797	$	8,972	$	69,355	$	66,119	$	36,479
Earnings per share - Diluted	$	0.16	$	0.06	$	0.45	$	0.43	$	0.24

THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CONDITION (Unaudited)

STATEMENTS OF CONDITION

(Dollars in thousands)	Mar 31, 2008			Dec 31, 2007			Sept 30, 2007			June 30, 2007			Mar 31, 2007
Assets:
Cash and due from banks	$	400,880		$	474,948		$	403,302		$	373,978		$	359,233
Interest bearing deposits in banks, federal funds sold		11,196			100,160			11,269			11,716			238,105
Securities purchased under agreements to resell		2,106,205			2,049,664			2,084,565			1,195,827			1,327,610
Total securities (AFS and HTM)		3,494,654			3,682,510			3,574,510			2,720,205			3,386,146
Loans held for sale		2,951,777			1,544,222			1,243,265			2,040,352			1,113,998
Loans, net of unearned income		16,094,478			15,923,178			15,206,452			15,457,047			14,921,476
Less: Allowance for loan losses		(240,795	)		(238,845	)		(172,678	)		(178,274	)		(172,602	)
Net loans		15,853,683			15,684,333			15,033,774			15,278,773			14,748,874
Premises and equipment, net		509,164			500,558			466,933			464,911			426,893
Intangible assets, net		1,064,485			1,071,605			912,131			915,379			671,282
Bank-owned life insurance		480,722			475,593			472,324			467,240			462,238
Accrued interest and other assets		479,981			392,396			341,993			354,581			337,523
Total Assets	$	27,352,747		$	25,975,989		$	24,544,066		$	23,822,962		$	23,071,902
Liabilities and Shareholders’ Equity:
Noninterest bearing transaction accounts	$	3,050,729		$	2,988,457		$	3,445,459		$	3,166,851		$	2,964,585
Interest bearing transaction accounts		6,526,822			6,783,116			6,331,223			6,505,883			6,444,194
Total non-time deposits		9,577,551			9,771,573			9,776,682			9,672,734			9,408,779
Time deposits		7,828,384			7,317,108			6,834,610			7,052,084			6,532,932
Brokered time deposits		1,865,393			1,455,586			323,349			359,245			441,012
Total deposits		19,271,328			18,544,267			16,934,641			17,084,063			16,382,723
Repurchase agreements		540,589			568,721			571,331			613,289			768,705
Federal funds purchased and other short-term borrowings		639,000			—			751,000			535,320			511,076
Long-term debt		4,169,939			4,023,836			3,604,927			2,919,387			3,051,628
Other liabilities		266,816			272,536			220,015			167,937			261,442
Total liabilities		24,887,672			23,409,360			22,081,914			21,319,996			20,975,574
Minority interest/REIT preferred securities		293,058			293,058			293,206			293,278			—
Total shareholders’ equity		2,172,017			2,273,571			2,168,946			2,209,688			2,096,328
Total Liabilities and Shareholders’ Equity	$	27,352,747		$	25,975,989		$	24,544,066		$	23,822,962		$	23,071,902
Common Shares Issued		168,063,887			167,407,169			163,172,315			163,102,683			156,662,992
Common Shares Outstanding		158,097,161			157,440,442			153,205,588			157,378,056			152,954,065

THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES

AVERAGE VOLUME AND RATES

(unaudited)

	Three Months Ended
	March 31, 2008							December 31, 2007							March 31, 2007
(Dollars in thousands)	Average Volume		Interest			Rate		Average Volume		Interest			Rate		Average Volume		Interest			Rate
Assets:
Loans, net of unearned income (2)	$	15,994,073	$	261,438		6.57	%	$	15,388,350	$	285,155		7.36	%	$	15,349,322	$	293,474		7.74	%
Loans held for sale (2)		3,160,736		40,397		5.14	%		1,642,694		27,125		6.55	%		1,287,027		21,981		6.93	%
Securities (2)		3,677,145		54,612		5.94	%		3,729,893		55,023		5.90	%		3,265,920		43,005		5.27	%
Securities purchased under agreements to resell		2,115,209		28,259		5.37	%		2,021,052		33,529		6.59	%		1,058,496		17,964		6.87	%
Other interest earning assets		120,231		992		3.32	%		135,136		1,512		4.45	%		97,005		1,171		4.90	%
Total interest earning assets		25,067,394	$	385,698		6.18	%		22,917,125	$	402,344		6.98	%		21,057,770	$	377,595		7.25	%
Nonearning assets (2)		2,582,448							2,414,450							1,996,179
Total assets	$	27,649,842						$	25,331,575						$	23,053,949
Liabilities and Shareholders’ Equity:
Interest bearing non-time deposits	$	6,609,657	$	32,634		1.99	%	$	6,363,370	$	43,564		2.72	%	$	6,313,784	$	48,481		3.11	%
Time deposits		9,080,876		104,872		4.64	%		7,791,880		96,899		4.93	%		6,872,764		84,603		4.99	%
Total interest bearing deposits		15,690,533		137,506		3.52	%		14,155,250		140,463		3.94	%		13,186,548		133,084		4.09	%
Repurchase agreements		544,218		3,705		2.74	%		566,305		5,065		3.55	%		763,461		8,555		4.54	%
Federal funds purchased and other short-term borrowings		1,379,961		11,592		3.38	%		937,034		10,985		4.65	%		1,164,191		15,277		5.32	%
Long-term debt (2)		4,084,015		49,110		4.83	%		3,907,985		48,484		4.93	%		2,925,030		40,018		5.53	%
Total interest bearing liabilities		21,698,727	$	201,913		3.74	%		19,566,574	$	204,997		4.16	%		18,039,230	$	196,934		4.42	%
Noninterest bearing demand deposits		3,067,214							2,982,015							2,780,374
Other liabilities (2)		309,546							236,435							166,607
Total liabilities		25,075,487							22,785,024							20,986,211
Minority interest/REIT preferred securities		293,058							293,098							—
Shareholders’ equity		2,281,297							2,253,453							2,067,738
Total liabilities and shareholders’ equity	$	27,649,842						$	25,331,575						$	23,053,949
Rate differential						2.44	%						2.82	%						2.83	%
Net yield on interest-earning assets on a tax equivalent basis			$	183,785		2.94	%			$	197,347		3.43	%			$	180,661		3.46	%
Taxable equivalent adjustments (1):
Loans				(195	)						(204	)						(146	)
Securities				(1,966	)						(1,942	)						(570	)
Total taxable equivalent adjustments				(2,161	)						(2,146	)						(716	)
Net interest income			$	181,624						$	195,201						$	179,945
TOTAL AVERAGE DEPOSITS
Total interest bearing deposits	$	15,690,533	$	137,506		3.52	%	$	14,155,250	$	140,463		3.94	%	$	13,186,548	$	133,084		4.09	%
Noninterest bearing demand deposits		3,067,214		—		—			2,982,015		—		—			2,780,374		—		—
Total average deposits	$	18,757,747	$	137,506		2.95	%	$	17,137,265	$	140,463		3.25	%	$	15,966,922	$	133,084		3.38	%

(1) Interest earned and average rates on securities and loans exempt from income taxes are reflected on a fully tax equivalent basis using a federal income tax rate of 35%, net of nondeductible interest expense.

(2) Unrealized gains(losses) on available for sale securities and the adjustments for mark to market valuations on hedged assets and liabilities have been classified in either nonearning assets or other liabilities.

THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES

SELECTED RATIOS AND ASSET QUALITY (unaudited)

SELECTED FINANCIAL RATIOS

	1st Qtr. 2008		4th Qtr. 2007		3rd Qtr. 2007		2nd Qtr. 2007		1st Qtr. 2007
Return on average assets*	0.36	%	0.14	%	1.15	%	1.15	%	0.64	%
Return on average equity*	4.37	%	1.58	%	12.65	%	12.24	%	7.15	%
Efficiency ratio(1)	67.02	%	55.29	%	53.29	%	56.20	%	57.38	%
Noninterest income(1)/ avg assets*	0.75	%	0.90	%	0.88	%	0.92	%	0.82	%
Noninterest expense(1)/ avg assets*	2.28	%	2.22	%	2.24	%	2.38	%	2.26	%
Net interest margin	2.94	%	3.43	%	3.65	%	3.66	%	3.46	%
Tangible common equity ratio:
Tangible common equity	4.21	%	4.83	%	5.32	%	5.65	%	6.36	%
Tangible common equity excluding unrealized gain(loss) on AFS securities	4.59	%	4.84	%	5.40	%	5.80	%	6.37	%
Tier I capital	8.05	%**	8.22	%	8.94	%	9.14	%	8.91	%
Total capital	12.01	%**	11.01	%	11.50	%	11.69	%	11.56	%
Leverage	6.10	%**	6.67	%	7.34	%	7.92	%	7.41	%

(1) These ratios utilize core noninterest income and core noninterest expense which represent non-GAAP measures.

* Annualized

** Estimated

SELECTED CREDIT QUALITY RATIOS

	March 31, 2008		Dec 31, 2007		Sept 30, 2007		June 30, 2007		March 31, 2007
Period end:
Allowance as a percent of net loans	1.50	%	1.50	%	1.14	%	1.15	%	1.16	%
Allowance as a percent of net loans excluding mortgage warehouse loans	1.54	%	1.52	%	1.14	%	1.16	%	1.16	%
Total nonperforming assets as a percent of net loans, other real estate and repossessions	1.65	%	0.86	%	0.46	%	0.29	%	0.22	%
Allowance as a percent of nonperforming assets	90	%	174	%	246	%	391	%	525	%
Allowance as a percent of nonperforming loans	98	%	196	%	280	%	460	%	601	%
Net charge-offs as a percent of average net loans:
Quarter to date (annualized)	0.84	%	0.88	%	0.27	%	0.20	%	0.06	%
Year to date (annualized)	0.84	%	0.35	%	0.18	%	0.13	%	0.06	%

NONPERFORMING ASSETS

(Dollars in thousands)	March 31, 2008			Dec 31, 2007			Sept 30, 2007			June 30, 2007			March 31, 2007
Nonaccrual loans	$	246,482		$	121,886		$	61,599		$	38,719		$	28,721
Restructured loans		—			—			—			—			—
Total nonperforming loans		246,482			121,886			61,599			38,719			28,721
Other real estate owned and repossessions		19,831			15,760			8,554			6,833			4,134
Total nonperforming assets	$	266,313		$	137,646		$	70,153		$	45,552		$	32,855
Aggregate loans contractually past due 90 days for which interest is being accrued	$	70,638		$	23,837		$	20,617		$	19,468		$	6,247
Total charge-offs	$	35,090		$	34,818		$	13,744		$	9,234		$	3,542
Total recoveries		(1,497	)		(923	)		(3,348	)		(1,654	)		(1,347	)
Net charge-offs:
Quarter to date	$	33,593		$	33,895		$	10,396		$	7,580		$	2,195
Year to date	$	33,593		$	54,066		$	20,171		$	9,775		$	2,195

EX-99.2

1

st

Quarter 2008 Earnings Overview

Exhibit 99.2

2

Forward Looking Statements

This

presentation

includes

“forward-looking statements”

within

the

meaning

of

the

federal

securities

laws.

Words

such

as

“believes,”

“estimates,”

“plans,”

“expects,”

“should,”

“may,”

“might,”

“outlook,”

“potential

”

and

“anticipates,”

the

negative

of

these

terms

and

similar expressions,

as they relate to The Colonial BancGroup, Inc. (BancGroup) (including its subsidiaries or its management), are intended to identify

forward-

looking

statements.

The

forward-looking

statements

in

this

presentation

are

subject

to

risks

and

uncertainties

that

could cause actual results to differ

materially from those expressed in or implied by such statements. In addition to factors mentioned

elsewhere

in

this

presentation

or

previously

disclosed

in

BancGroup’s

SEC

reports

(accessible

on

the

SEC’s

website

at

www.sec.gov

or

on

BancGroup’s

website

at

www.colonialbank.com),

the

following

factors,

among

others,

could

cause

actual

results

to

differ

materially from forward-

looking statements and future results could differ materially from historical performance. These factors are not exclusive:

losses to our loan portfolio are greater than estimated or expected;

an inability to raise additional capital on terms and conditions that are satisfactory;

the impact of current economic conditions on our ability to borrow additional funds to meet our liquidity needs;

economic conditions affecting real estate values and transactions in BancGroup’s market and/or general economic     

conditions, either nationally or regionally, that are less favorable then expected;

changes in the interest rate environment which expand or reduce margins or adversely affect critical estimates as applied

and projected returns on investments;

deposit attrition, customer loss, or revenue loss in the ordinary course of business;

increases in competitive pressure in the banking industry and from non-banks;

costs or difficulties related to the integration of the businesses of BancGroup and institutions it acquires are greater than

expected;

the inability of BancGroup to realize elements of its strategic plans for 2008 and beyond;

natural disasters in BancGroup’s primary market areas which result in prolonged business disruption or materially impair

the value of collateral securing loans;

management’s assumptions and estimates underlying critical accounting policies prove to be inadequate or materially

incorrect or are not borne out by subsequent events;

the impact of recent and future federal and state regulatory changes;

current or future litigation, regulatory investigations, proceedings or inquiries;

strategies to manage interest rate risk may yield results other than those anticipated;

changes which may occur in the regulatory environment;

a significant rate of inflation (deflation);

acts of terrorism or war; and

changes in the securities markets.

Many of these factors are beyond BancGroup’s control. The reader is cautioned not to place undue reliance on any forward looking

statements

made

by

or

on

behalf

of

BancGroup.

Any

such

statement

speaks

only

as

of

the

date

the

statement

was

made

or

as

of

such

date

that

may

be

referenced

within

the

statement.

BancGroup

does

not

undertake

any

obligation

to

update

or

revise

any

forward-looking statements.

3

$27 billion in assets with 342 branches at 3/31/2008

Top

25*

U.S.

commercial

bank

(non-foreign

owned)

Proven community banking philosophy with regional bank management and local boards of

directors

Top 6* market share in 87% of retail deposit franchise

•

Attractive banking franchise

•

Strong and growing retail banking business

Long history of superior asset quality across portfolios and credit cycles

•

Conservative loan loss reserve level

•

No subprime residential mortgage products

Solid capital levels

Strong liquidity position

Consistent core profitability

Stable, experienced management team

Overview

*Source:  SNL Financial

4

Credit Quality –

1

st

Quarter 2008 Update

Credit quality is sound and within expectations

No subprime, no stated income and no exotic loan or investment products

Maintained loan loss reserve at 1.50% of loans at 3/31/08

1 

quarter net charge-offs were $34 million or 0.84% annualized of average loans down from

0.88% annualized from the 4

quarter

of 2007

Nonperforming

assets

were

$266

million

or

1.65%

of

net

loans

and

ORE

at

3/31/08

compared

to 0.86% at 12/31/07

st

th

5

Loan Portfolio

At 3/31/08 (excluding unearned income)

49.5%

$7,968.3

Commercial Real Estate

2.6%

$434.0

Consumer & Other

20.3%

$3,265.1

Residential Construction

100%

$16,113.5

Total

3.7%

$598.0

Mortgage Warehouse Lending

7.4%

$1,194.3

Commercial & Industrial

16.5%

$2,653.8

Residential Real Estate

Percentage of Total

Portfolio

Dollars Outstanding

(millions)

Business Line

6

Residential Construction

By Location and Property Type at 3/31/08

20% of total loan portfolio

-

$3.265 billion

($ in millions)

National Builders, $53

Land, $440

Residential Spec, $582

Consumer-Owned

Lots, $136

Builder Lot Inventory,

$180

Residential Presold,

$211

A&D,  $1,273

Condo,  $390

Total

Outstanding

A&D

Builder

Lots

Consumer

Lots

Res.

Presold

Res.

Spec

Land

Condo

National

Builders

Florida

1,608

$            

568

$  

72

$   

99

$         

113

$    

214

$

224

$

298

$    

20

$     

Texas

540

279

41

5

17

74

75

16

33

Georgia

410

188

32

2

30

115

20

23

-

Alabama

393

126

32

27

26

151

24

7

-

Nevada

204

80

1

2

22

25

49

25

-

Other

110

32

2

1

3

3

48

21

-

Total

3,265

$            

1,273

$

180

$ 

136

$       

211

$    

582

$

440

$

390

$    

53

$     

7

Florida

$107.8

40.4%

Georgia

$29.6

11.1%

Texas

$7.6

2.9%

Other

$2.2

0.8%

Nevada

$33.1

12.5%

Alabama

$5.8

2.2%

Residential

Development

$43.0

16.1%

Consumer Lots

$8.4

3.2%

Condo

Construction

$62.2

23.4%

Residential Land

$17.4

6.5%

Homes under

Construction

$43.6

16.4%

Builder Lot

Inventory

$11.5

4.3%

Residential Construction NPAs

At 3/31/08 –

Total $186.1 million (or 69.9% of total non-performing assets)

($ in millions)

Property Type

Location

(note: percentages in above charts represent proportion to total

NPAs)

8

Residential Construction Net Charge-Offs

At 3/31/08 –

Total $26.2 million (or 77.9% of total net charge-offs)

($ in millions)

Property Type

Location

Condo

Construction

$11.7

34.8%

Residential Land

$0.1

0.2%

Homes under

Construction

$4.9

14.7%

Residential

Development

$6.5

19.3%

Consumer Lots

$0.6

1.8%

Builder Lot

Inventory

$2.4

7.1%

Other

$1.5

4.5%

Texas

$0.7

2.1%

Georgia

$5.6

16.6%

Florida

$17.7

52.6%

Alabama

$0.7

2.1%

(note: percentages in above charts represent proportion to total

net charge-offs)

9

Commercial Real Estate

(Excluding Residential and Condominium Construction)

By location and property type at 3/31/08

50% of total loan portfolio

-

$7.968 billion

($ in millions)

Commercial Dev.

and Lots

$608.3

7.6%

Commercial

Land

$1,010.6

12.7%

Industrial

$1,021.2

12.8%

Lodging

$371.1

4.7%

Multifamily

$680.7

8.5%

Office

$1,368.5

17.2%

Other

$885.6

11.1%

Retail

$1,524.4

19.1%

Healthcare

$497.9

6.3%

Alabama

$845.3

10.6%

Florida

$4,602.6

57.8%

Georgia

$550.8

6.9%

Texas

$770.4

9.7%

Nevada

$513.4

6.4%

Other

$685.8

8.6%

Property Type

Location

10

Florida,

$45.3,

17.0%

Georgia,

$1.7,

0.6%

Nevada,

$1.3,

0.5%

Other,

$3.4,

1.3%

Alabama,

$5.1,

1.9%

Commercial

Land,

$37.9,

14.2%

Office,

$6.7,

2.5%

Other,

$3.6,

1.4%

Retail,

$1.6,

0.6%

Warehouse,

$1.8,

0.7%

Commercial

Dev. and Lots,

$1.2,

0.4%

Multifamily,

$2.6,

1.0%

Industrial,

$1.4,

0.5%

Commercial Real Estate NPAs

(Excluding Residential and Condominium Construction)

At 3/31/08–

Total $56.8 million (or 21.3% of total non-performing assets)

($ in millions)

Location

Property Type

(note: percentages in above charts represent proportion to total

NPAs)

11

Commercial Real Estate Net Charge-Offs

(Excluding Residential and Condominium Construction)

At 3/31/08–

Total $2.5 million (or 7.4% of total net charge-offs)

($ in millions)

Church or

School

$0.3

0.8%

Commercial

Land

$1.8

5.4%

Other

$0.1

0.4%

Industrial

$0.3

0.8%

Florida

$2.1

6.2%

Alabama

$0.1

0.4%

Georgia

$0.3

0.8%

Location

Property Type

(note: percentages in above charts represent proportion to total

net charge-offs)

12

Other Loan Types

At

3/31/08

–

30%

of

total

portfolio

-

$4.880

billion

($ in millions)

Residential RE

$2,653.8

54.4%

Commercial &

Industrial

$1,194.3

24.5%

Consumer & Other

$434.0

8.9%

Mortgage

Warehouse

Lending

$598.0

12.2%

13

Consumer &

Other

$1.2

3.5%

Residential RE

$1.2

3.7%

Commercial &

Industrial

$2.5

7.5%

Commercial &

Industrial

$2.1

0.8%

Consumer &

Other

$1.0

0.4%

Residential RE

$20.3

7.6%

Other Loan Types -

NPAs

and Net Charge-Offs

At 3/31/08–

NPAs

totaled $23.4 million, NCOs totaled $4.9 million

($ in millions)

NCOs

NPAs

(note: percentages in above charts represent proportion to total

NPAs

and NCOs)

14

Commercial

Construction

$40.8

15.3%

Condominium

Construction

$62.2

23.4%

Non-RE

$3.1

1.2%

Permanent

CRE

$16.0

6.0%

Permanent

Residential

$20.3

7.6%

Residential

Construction

$123.9

46.5%

Property Type

Location

Nonperforming Assets by Type and Location

At 3/31/08 –

Total $266.3 million

($ in millions)

Florida

$169.3

63.6%

Georgia

$32.6

12.2%

Alabama

$15.6

5.9%

Nevada,

$34.8,

13.0%

Texas

$7.7

2.9%

Other

$6.3

2.4%

15

Net Charge Offs by Type and Location

First Quarter 2008 –

Total $33.6 million

($ in millions)

Property Type

Location

Residential

Construction

$14.5

43.2%

Condo

Construction

$11.7

34.8%

C & I

$2.5

7.5%

Consumer &

Other

$1.2

3.5%

CRE

$0.6

1.7%

Residential RE

$1.2

3.7%

Commercial

Construction

$1.9

5.6%

Florida

$24.3

72.3%

Georgia

$5.7

17.1%

Other

$1.7

5.0%

Texas

$0.7

2.1%

Alabama

$1.2

3.5%

16

1

st

Quarter 2008 Summary of Results

Earnings per share of $0.16 for the 1Q08; an increase of $0.10 over the 4Q07

Net interest income decreased 7% from the 4Q07

•

Net

interest

margin

was

2.94%

for

the

1Q08 compared

to

3.43%

for

the

4Q07

Strong average deposit growth of 17% over 1Q07

Loan loss reserve was 1.50% of net loans; provisions exceeded net charge-offs

Core noninterest income growth of 11% over 1Q07

Core noninterest expense increased 12% over the 4Q07

Issued $250 million of subordinated debt at 8.875%, qualifies for Tier 2 capital

Strong liquidity and solid capital position

17

$1.37 ¹

$1.72

$1.52

$1.31

$1.16

$1.26

$1.06

2001

2002

2003

2004

2005

2006

2007

1Q07

4Q07

1Q08

(diluted)

Earnings Per Share

19%

(8)%

13%

16%

13%

$1.17

1

Excluding one-time gains, restructuring and other charges

$0.24

$0.06

$0.16

18

$422

$455

$495

$567

$709

$755

$761

$180

$195

$182

2001

2002

2003

2004

2005

2006

2007

1Q07

4Q07

1Q08

Net Interest Income

($ in millions)

8%

9%

15%

25%

80%

6%

3.57%    3.55%    3.38%    3.52%    3.75%    3.71%   3.55%

3.46%    3.43%   2.94%

Net Interest

Margin

1%

5 Year CAGR = 11%

2002 -

2007

19

Net Interest Income and Margin

($ in millions)

Tax Equivalent

NII

NIM

4Q07

$197.3

3.43%

Citrus & Chemical Bank

3.6

-0.01

Deposit mix change and inelastic deposit pricing

(7.9)

-0.13

Increase in Mortgage Warehouse assets

5.8

-0.12

Asset sensitivity

(14.3)

-0.24

New sub debt issuance

(0.5)

-0.01

Other

(0.2)

0.02

1Q08

$183.8

2.94%

20

$8,433

$8,734

$9,419

$10,862

$13,988

$15,788

$17,137

$18,758

$16,566

$15,967

2001

2002

2003

2004

2005

2006

2007

1Q07

4Q07

1Q08

Average Deposits

4%

8%

15%

1

Excluding acquisitions

($ in millions)

29%

5 Year CAGR = 14%

2002 -

2007

96%

13%

5%

1% ¹

17%

7% ¹

NOTE:

Growth percent is 1Q07 to 1Q08

21

2.30%

2.37%

2.42%

2.42%

2.33%

2.27%

2.26%

2.22%

2.28%

2002

2003

2004

2005

2006

2007

1Q07

4Q07

1Q08

$107

$141

$146

$176

$182

$209

$46

$52

2002

2003

2004

2005

2006

2007

1Q07

1Q08

Strong Growth in Noninterest Income

and Controlled Expenses

Core Noninterest Income

Growth

Core Noninterest Expense

to Average Assets

1

Excluded from noninterest income are securities and derivatives gains (losses), securities restructuring charges, changes in fair value of swap

derivatives and gain on sale of Goldleaf, merchant services, branches and mortgage loans

2

Excluded from noninterest expense are net losses related to the early extinguishment of debt, severance expense and merger related expenses

11%

($ in millions)

1

2

22

Solid capital position

•

Proactively managing capital for economic uncertainty and the challenging operating environment

•

Planned offering is expected to fortify the balance sheet

•

Lower dividend preserves capital of approximately $60 million annually, or 30 basis points of Tier 1

•

Expected decreases in loans and warehouse assets will strengthen

capital ratios

•

Key ratios at 3/31/08:

Strong Liquidity

•

Ample sources of liquidity -

unused wholesale funding sources are in excess of $5 billion

•

Strong average organic deposit growth from the retail banking franchise, 9.4% annualized from December 31,

2007 to March 31, 2008; deposits fund 70% of assets

Strong, high quality investment portfolio

•

95.3% of portfolio is AAA-rated or government-backed, ex. Federal reserve stock and FHLB stock

•

No subprime or CDO exposure

(1)

Includes REIT preferred stock

(2)

Pro forma for $250 million common stock offering

*Estimated

Strong Liquidity and Capital Position

3/31/08

3/31/08

Actual

Pro Forma

(2)

Tangible common equity ratio

4.21%

5.16%

excluding unrealized loss on AFS

4.59%

5.54%

Tangible capital ratio

(1)

5.33%

6.28%

Tier I leverage ratio

6.10%

*

7.04%

Tier I capital ratio

8.05%

*

9.30%

Total risk based capital ratio  

12.01%

*

13.26%

23

We expect the remainder of 2008 to be a challenging operating environment for all banks

including Colonial

We believe that we have a realistic view of the operating environment

Liquidity is strong

Solid capital position; common stock offering will ensure that we have significant financial

flexibility to weather the tough times ahead

We have isolated the problem credits to the residential real estate construction sector of

the loan portfolio

No off-balance sheet items

2008 Outlook

24

Supplemental Information

25

Selected Average Balances

($ in millions)

% Change From

1Q08

4Q07

1Q07

4Q07

1Q07

Earning Assets

25,067

$    

22,917

$    

21,058

$    

9%

19%

Loans, Net of Unearned Income

15,994

15,388

15,349

4%

4%

Loans Held for Sale

3,161

1,643

1,287

92%

146%

Securities 

3,677

3,730

3,266

-1%

13%

Resell Agreements and

Other Interest Earning Assets

2,235

2,156

1,156

4%

93%

Total Assets

27,650

25,332

23,054

9%

20%

Total Deposits

18,758

17,137

15,967

9%

17%

Noninterest Bearing Deposits

3,067

2,982

2,780

3%

10%

Interest Bearing Transaction Accounts

6,610

6,363

6,314

4%

5%

Time Deposits

9,081

7,792

6,873

17%

32%

Repurchase Agreements

544

566

763

-4%

-29%

S/T Borrowings and Fed Funds

1,380

937

1,164

47%

19%

L/T Debt

4,084

3,908

2,925

5%

40%

Shareholders' Equity

2,281

2,253

2,068

1%

10%

26

Noninterest Income

($ in millions)

1

Core noninterest income was used in the calculation

% Change

1Q08

4Q07

1Q07

4Q07

1Q07

Service Charges on Deposit Accounts

19.2

$    

19.7

$    

17.7

$    

-3%

8%

Electronic Banking

5.0

4.9

4.4

2%

14%

Other Retail Banking Fees

2.6

2.6

3.6

0%

-28%

Retail Banking Fees

26.8

27.2

25.7

-1%

4%

Financial Planning Services

4.8

4.1

3.8

17%

26%

Mortgage Banking Origination and Sales

6.8

4.8

3.2

42%

113%

Mortgage Warehouse Fees

1.0

3.0

6.9

-67%

-86%

Bank-Owned Life Insurance

5.1

5.2

4.9

-2%

4%

Other Income

7.1

13.0

1.8

-45%

294%

Core Noninterest Income

51.6

57.3

46.3

-10%

11%

Securities and Derivatives Gains, Net

6.1

2.0

1.0

212%

519%

Securities Restructuring Charges

-

-

(36.0)

-

100%

Gain on Sale of Mortgage Loans

-

-

3.9

-

-100%

Total Noninterest Income

57.7

$    

59.3

$    

15.2

$    

-3%

279%

Annualized Noninterest Income to Average Assets

1

0.75%

0.90%

0.82%

Noninterest Income to Total Revenue

1

22.1%

22.7%

20.5%

27

Noninterest Expense

($ in millions)

1

Core

noninterest

income

and

core

noninterest

expense

are

used

in

the

calculation

% Change

1Q08

4Q07

1Q07

4Q07

1Q07

Salaries and Employee Benefits

73.7

$  

70.9

$   

69.6

$  

4%

6%

Occupancy Expense of Bank Premises, Net

23.1

21.8

18.5

6%

25%

Furniture and Equipment Expense

14.7

13.6

13.1

8%

12%

Professional Services

5.6

5.1

4.1

10%

37%

FDIC Insurance and Other Regulatory Fees

4.6

2.1

1.2

119%

283%

Electronic Banking and Other Retail Banking Expenses

4.2

4.2

4.2

0%

0%

Amortization of Intangible Assets

4.2

3.6

3.1

17%

35%

Communications

2.8

2.5

3.0

12%

-7%

Loss on Equity Investments

2.7

1.4

0.3

93%

800%

Loan and Other Real Estate Related Costs

2.7

1.4

0.3

93%

800%

Postage and Courier

2.6

2.7

2.6

-4%

0%

Advertising

2.6

2.6

2.2

0%

18%

Travel

1.4

1.7

1.7

-18%

-18%

Other Expense

13.0

7.2

6.4

81%

103%

Core Noninterest Expense

157.9

140.8

130.3

12%

21%

Severance Expense

0.2

2.6

3.0

-91%

-92%

Merger Related Expenses

-

1.7

0.4

-100%

-100%

Net Losses Related to the Early Extinguishment of Debt

5.9

-

4.4

100%

35%

Total noninterest expense

164.0

$

145.1

$

138.1

$

13%

19%

Efficiency Ratio

67.02%

55.29%

57.38%

Annualized Noninterest Expense to Average Assets

2.28%

2.22%

2.26%

1

1

28

Diversified CRE/Construction Loan Portfolio

As of 12/31/07

Property Type

Total Exposure

Central FL

West Coast  FL

South FL

Panhandle FL

Northern FL

Alabama

Georgia

Texas

Nevada

Other

Retail

13.96%

1.30%

2.51%

2.74%

0.14%

0.31%

1.43%

0.81%

2.07%

0.93%

1.71%

Retail -

other than gas stations

11.60%

1.11%

1.61%

2.36%

0.14%

0.11%

1.01%

0.68%

2.05%

0.86%

1.69%

Gas Station/Convenience Store

2.36%

0.19%

0.90%

0.39%

0.00%

0.21%

0.42%

0.14%

0.02%

0.07%

0.03%

Residential Development

13.80%

2.82%

1.60%

0.46%

0.78%

0.13%

1.37%

2.05%

3.45%

0.71%

0.43%

Builder Lot Inventory

1.96%

0.11%

0.27%

0.25%

0.19%

0.01%

0.24%

0.37%

0.48%

0.01%

0.03%

Commercial Development

5.01%

1.21%

0.73%

0.64%

0.00%

0.10%

0.09%

0.12%

0.60%

1.27%

0.26%

Commercial Lot Inventory

1.17%

0.12%

0.26%

0.23%

0.01%

0.00%

0.04%

0.33%

0.12%

0.00%

0.05%

Residential Homes (under construction)

9.95%

2.11%

1.12%

0.69%

0.21%

0.04%

1.78%

2.03%

1.02%

0.81%

0.15%

Multi-family

7.20%

0.66%

1.80%

1.10%

0.11%

0.09%

0.83%

0.14%

1.34%

0.21%

0.92%

Land Only

14.62%

3.02%

2.83%

1.38%

1.45%

0.14%

1.16%

0.45%

1.58%

1.26%

1.34%

Commercial Land

10.06%

1.92%

2.26%

1.22%

0.91%

0.13%

0.99%

0.24%

0.89%

0.61%

0.88%

Residential Land

4.56%

1.10%

0.57%

0.16%

0.54%

0.01%

0.17%

0.21%

0.69%

0.65%

0.46%

Office

8.09%

1.10%

2.00%

2.31%

0.09%

0.08%

0.60%

0.49%

0.78%

0.31%

0.32%

Office -

non-medical

7.31%

0.87%

1.84%

2.27%

0.09%

0.08%

0.55%

0.43%

0.68%

0.28%

0.23%

Office -

Medical

0.77%

0.24%

0.17%

0.04%

0.00%

0.00%

0.06%

0.06%

0.10%

0.03%

0.09%

Condominium Bldgs

-

Construction

4.74%

1.34%

1.39%

0.54%

0.30%

0.01%

0.10%

0.37%

0.18%

0.22%

0.29%

Warehouse

5.41%

0.96%

1.16%

1.60%

0.02%

0.03%

0.41%

0.24%

0.13%

0.78%

0.07%

Warehouse with Office

3.23%

0.63%

0.88%

0.88%

0.02%

0.03%

0.18%

0.15%

0.07%

0.40%

0.00%

Warehouse

1.31%

0.22%

0.16%

0.69%

0.00%

0.00%

0.11%

0.06%

0.05%

0.00%

0.03%

Mini-Warehouse

0.87%

0.12%

0.13%

0.03%

0.00%

0.01%

0.13%

0.03%

0.01%

0.38%

0.04%

Healthcare -

Living Facility

3.26%

0.12%

0.20%

0.02%

0.10%

0.05%

0.79%

0.62%

0.36%

0.00%

0.99%

Skilled Nursing Facility

1.22%

0.00%

0.13%

0.00%

0.05%

0.05%

0.50%

0.14%

0.00%

0.00%

0.35%

Assisted Living Facility

1.48%

0.00%

0.07%

0.02%

0.05%

0.00%

0.29%

0.05%

0.36%

0.00%

0.64%

Congregate Care Facility

0.55%

0.12%

0.00%

0.00%

0.00%

0.00%

0.00%

0.43%

0.00%

0.00%

0.00%

Healthcare

1.47%

0.02%

0.08%

0.01%

0.00%

0.01%

0.04%

0.00%

1.22%

0.01%

0.07%

Lodging

4.14%

0.57%

0.66%

0.24%

0.00%

0.05%

0.51%

0.64%

0.44%

0.11%

0.91%

Recreation

0.15%

0.04%

0.07%

0.00%

0.00%

0.01%

0.04%

0.00%

0.00%

0.00%

0.00%

Industrial

1.08%

0.08%

0.17%

0.04%

0.00%

0.00%

0.06%

0.03%

0.47%

0.04%

0.19%

Farm

0.94%

0.28%

0.11%

0.27%

0.05%

0.02%

0.09%

0.00%

0.06%

0.00%

0.06%

All Other Types

3.04%

0.80%

0.77%

0.62%

0.14%

0.17%

0.21%

0.16%

0.13%

0.01%

0.03%

Total

100.00%

16.66%

17.74%

13.15%

3.58%

1.27%

9.78%

8.88%

14.43%

6.69%

7.82%

Notes:

1) Includes outstanding exposures (balances plus commitments).

2) Does not include owner occuppied

properties (except for owner occupied Healthcare -

Living Facilities and Gas Stations).

Commercial Real Estate Exposures by Geographic Location

Expressed as a Percentage of Commercial Real Estate Portfolio

Includes Commercial Real Estate and Construction Loan Exposures

(Principal Balances and Amounts Available To Be Drawn)

EX-99.3

Exhibit 99.3

PRESS RELEASE

For more information contact:	April 21, 2008
Lisa Free
(334) 676-5105

COLONIAL BANCGROUP ANNOUNCES

COMMON STOCK OFFERING

MONTGOMERY, Ala. - (NYSE: CNB) The Colonial BancGroup, Inc. today announced that it will issue 25 million shares of its common stock in an underwritten registered offering. Colonial has granted the underwriters a 30-day option to purchase up to an additional 3,750,000 shares of common stock to cover over-allotments. Net proceeds of the offering will be used for general corporate purposes, including investments in subsidiaries. Lehman Brothers Inc. is acting as the sole book-running manager of this offering. Credit Suisse Securities (USA) LLC, SunTrust Robinson Humphrey and Morgan Keegan & Company, Inc. are the co-managers for the offering.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any offer or sale of the shares of common stock in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any jurisdiction. Any offer, solicitation or sale will be made only by means of the prospectus supplement and the accompanying base prospectus.

The shares issued are registered pursuant to The Colonial BancGroup, Inc.’s automatic shelf registration statement which was filed with the Securities and Exchange Commission on April 18, 2008. A prospectus supplement and the accompanying base prospectus when

available may be obtained from: Lehman Brothers Inc., c/o Broadridge, Integrated Distribution Services, 1144 Long Island Avenue, Edgewood, NY 11717; fax: 631-254-7140, or email: qiana.smith@broadridge.com.

This release includes “forward-looking statements” within the meaning of the federal securities laws. Words such as “believes,” “estimates,” “plans,” “expects,” “should,” “may,” “might,” “outlook,” “potential” and “anticipates,” the negative of these terms and similar expressions, as they relate to The Colonial BancGroup, Inc. (BancGroup) (including its subsidiaries or its management), are intended to identify forward-looking statements. The forward-looking statements in this release are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by such statements. In addition to factors mentioned elsewhere in this release or previously disclosed in BancGroup’s SEC reports (accessible on the SEC’s website at www.sec.gov or on BancGroup’s website at www.colonialbank.com), the following factors, among others, could cause actual results to differ materially from forward-looking statements and future results could differ materially from historical performance. These factors are not exclusive:

• losses to our loan portfolio are greater than estimated or expected;

• an inability to raise additional capital on terms and conditions that are satisfactory;

• the impact of current economic conditions on our ability to borrow additional funds to meet our liquidity needs;

• economic conditions affecting real estate values and transactions in BancGroup’s market and/or general economic conditions, either nationally or regionally, that are less favorable then expected;

• changes in the interest rate environment which expand or reduce margins or adversely affect critical estimates as applied and projected returns on investments;

• deposit attrition, customer loss, or revenue loss in the ordinary course of business;

• increases in competitive pressure in the banking industry and from non-banks;

• costs or difficulties related to the integration of the businesses of BancGroup and institutions it acquires are greater than expected;

• the inability of BancGroup to realize elements of its strategic plans for 2008 and beyond;

• natural disasters in BancGroup’s primary market areas which result in prolonged business disruption or materially impair the value of collateral securing loans;

• management’s assumptions and estimates underlying critical accounting policies prove to be inadequate or materially incorrect or are not borne out by subsequent events;

• the impact of recent and future federal and state regulatory changes;

• current and future litigation, regulatory investigations, proceedings or inquiries;

• strategies to manage interest rate risk may yield results other than those anticipated;

• changes which may occur in the regulatory environment;

• a significant rate of inflation (deflation);

• acts of terrorism or war; and

• changes in the securities markets.

Many of these factors are beyond BancGroup’s control. The reader is cautioned not to place undue reliance on any forward looking statements made by or on behalf of BancGroup. Any such statement speaks only as of the date the statement was made or as of such date that may be referenced within the statement. BancGroup does not undertake any obligation to update or revise any forward-looking statements.

2