Unassociated Document

Commenting on third quarter results, Chief Executive Officer John M. Mendez stated, “Our recent results further confirm our earnings capacity and strength. Third quarter GAAP earnings of $6.55 million reflect increases of $1.42 million and $19.12 million over the second quarter of this year and the comparable quarter in 2009, respectively. Annualized return on average assets for the recently completed quarter reached 1.14%, the highest level in over two years. These results were achieved despite the lingering effects of the recession and the continued pressures of the real estate and construction market sectors.”

Mendez summarized, saying, “We continue to operate with very high levels of liquidity, which tend to constrain net interest margin; however, we are committed to preserving the strength of our balance sheet through the remainder of the business cycle. First Community’s combination of strength in earnings and capital, coupled with its excellent asset quality measures, set the stage for what we believe to be excellent prospects for the future and continued ability to capitalize on a range of opportunities.”

Third Quarter 2010 Highlights –

Tax-equivalent net interest margin for the third quarter of 2010 was 3.87% compared to 3.68% from the comparable quarter of 2009. Net interest income was $18.60 million for the third quarter of 2010, an increase of $1.06 million, or 6.05%, from the third quarter of 2009. Interest income was $25.84 million for the third quarter of 2010, a decrease of $1.29 million, or 4.75%, from the third quarter of 2009. The yield on loans decreased to 6.07% for the third quarter of 2010 from 6.14% in the same period of the prior year, while average loans increased $42.14 million between the comparable periods to $1.40 billion. The Company continued to maintain a high level of liquidity with average cash and cash equivalent balances of $82.52 million in the third quarter of 2010.

Third quarter 2010 interest expense was $7.24 million, a decrease of $2.35 million, or 24.50%, from the third quarter of 2009. Third quarter 2010 deposit costs decreased $2.13 million compared to the third quarter of 2009, which was primarily due to a decrease in the average rate paid on interest-bearing deposits of 58 basis points to 1.35% for the third quarter of 2010 compared to the same period in the prior year. Compared to the third quarter of 2009, interest costs on borrowings decreased $225 thousand to $2.37 million for the third quarter of 2010, while the average balance decreased $4.80 million for the comparable periods due to the redemption of various wholesale borrowings and decreasing rates of interest paid. The cost of interest-bearing liabilities decreased 51 basis points during the third quarter of 2010 compared to the third quarter of 2009. Average interest-bearing liabilities decreased $8.79 million, or 0.49% for the third quarter of 2010 compared with the third quarter of 2009, which included a decrease of $3.95 million in Federal Home Loan Bank (“FHLB”) borrowings and other long-term debt.

During the third quarter of 2010, wealth management revenues decreased $62 thousand, or 6.39%, to $909 thousand from the third quarter of 2009. The Wealth Management Division reported $836 million in assets under management at September 30, 2010. Service charges on deposit accounts were $3.46 million for the third quarter of 2010, a decrease of $202 thousand, or 5.52%, from the third quarter of 2009. Insurance commissions were $1.66 million for the third quarter of 2010, an increase of $96 thousand, or 6.13%, from the comparable quarter of 2009. During the third quarter of 2010, GreenPoint Insurance Group, Inc., the Company’s wholly-owned insurance subsidiary, acquired Murphy Insurance Agency, based in Princeton, West Virginia.

Noninterest expenses for the third quarter of 2010 decreased $339 thousand, or 1.91%, compared to the third quarter of 2009. The decrease was primarily due to merger-related expenses incurred in the third quarter of 2009 resulting from the TriStone merger. These reductions were offset by salary and employee benefit increases of $893 thousand, or 11.36%, reflecting the increase in the number of branches, general increases in other operational areas, and increasing health care costs. Federal Deposit Insurance Corporation (“FDIC”) deposit insurance premiums decreased $595 thousand, or 45.32% in the third quarter of 2010, compared to the third quarter of 2009, due to a prior year’s change in the way FDIC assessments are calculated and collected. The efficiency ratio for the third quarter of 2010 was 58.92% compared to 59.40% for the third quarter of 2009.

The Company’s loan quality measures at September 30, 2010 continue to compare favorably to the industry. Total loan delinquencies of 30 days or more, including non-accrual loans, as a percent of total loans were 1.76% at September 30, 2010, 1.70% at June 30, 2010, and 2.35% at March 31, 2010. That compares favorably to the most recent reporting by the Company’s Federal Reserve peer group of bank holding companies with total assets between $1 and $3 billion, which reported total loan delinquencies of 4.65%. The ratio of allowance for loan losses as a percent of loans held for investment was 1.89% at September 30, 2010, compared to 1.79% at June 30, 2010, and 1.76% at March 31, 2010.

Total non-performing assets, which include other real estate owned, were 1.31% of total assets at September 30, 2010, and non-performing loans as a percentage of loans held for investment were 1.76%. The Federal Reserve peer group last reported total non-performing assets to total assets of 3.42% and non-performing loans to total loans of 3.67%. Included in non-performing assets are $7.90 million of unseasoned troubled debt restructurings at September 30, 2010. The Company was more active this quarter in restructuring loan terms for creditworthy customers. Approximately $578 thousand of the third quarter provision for loan losses was related to lowering the interest rate for borrowers under restructured terms.

The Company will host an investor and media teleconference and webcast on Friday, October 22, 2010, at 11:00 a.m. To access the teleconference, the toll-free number is (877) 407-8033. Alternatively, individuals may listen to the live or archived webcast of the conference call. To listen to the webcast, visit www.fcbinc.com and follow the link under the Investor Relations section. The Company’s press release and financial summary will be available in this section, as well. Copies of the Company’s third quarter 2010 earnings press release and financial summary will also be made available upon request via fax, email or postal service mail. To request a copy, contact David D. Brown, Chief Financial Officer, at (276) 326-9000.

First Community Bancshares, Inc., headquartered in Bluefield, Virginia, is a $2.30 billion financial holding company and is the parent company of First Community Bank, N. A. First Community Bank, N. A. operates through fifty-six locations in the five states of Virginia, West Virginia, North Carolina, South Carolina, and Tennessee. First Community Bank, N. A. offers wealth management services through its Trust & Financial Services Division and Investment Planning Consultants, Inc., a registered investment advisory firm which offers wealth management and investment advice. The Company’s Wealth Management Division managed assets with a market value of $836 million at September 30, 2010. The Company is also the parent company of GreenPoint Insurance Group, Inc., a full-service insurance agency headquartered in High Point, North Carolina, that operates ten offices. The Company’s common stock is traded on the NASDAQ Global Select Market under the symbol, “FCBC”. Additional investor information can be found on the Internet at www.fcbinc.com.

This news release may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include: changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed from time to time in the Company’s Securities and Exchange Commission reports, including but not limited to the Annual Report on Form 10-K for the most recent year ended. Pursuant to the Private Securities Litigation Reform Act of 1995, the Company does not undertake to update forward-looking statements contained within this news release.

(Unaudited)	Three Months Ended						Nine Months Ended
(In Thousands, Except Share and Per Share Data)	September 30,						September 30,
	2010			2009			2010			2009
Interest Income
Interest and fees on loans held for investment	$	21,440		$	21,064		$	63,791		$	60,619
Interest on securities – taxable		2,895			4,562			10,411			14,903
Interest on securities – nontaxable		1,451			1,449			4,271			4,527
Interest on federal funds sold and deposits		54			55			134			133
Total interest income		25,840			27,130			78,607			80,182
Interest Expense
Interest on deposits		4,872			6,998			15,480			21,641
Interest on borrowings		2,371			2,596			7,369			8,251
Total interest expense		7,243			9,594			22,849			29,892
Net interest income		18,597			17,536			55,758			50,290
Provision for loan losses		3,810			3,819			11,071			8,519
Net interest income after provision for loan losses		14,787			13,717			44,687			41,771
Noninterest Income
Wealth management income		909			971			2,806			3,088
Service charges on deposit accounts		3,457			3,659			9,796			10,307
Other service charges and fees		1,244			1,156			3,775			3,467
Insurance commissions		1,663			1,567			5,253			5,523
Net impairment losses recognized in earnings		-			(30,811	)		(185	)		(34,796	)
Security gains		2,574			866			4,025			2,930
Acquisition gain		-			4,493			-			4,493
Other operating income		1,091			815			2,950			1,648
Total noninterest income (loss)		10,938			(17,284	)		28,420			(3,340	)
Noninterest Expense
Salaries and employee benefits		8,753			7,860			25,209			23,131
Occupancy expense of bank premises		1,573			1,266			4,852			4,202
Furniture and equipment expense		926			928			2,748			2,758
Amortization of intangible assets		260			262			769			751
FHLB debt prepayment fees		-			-			-			88
FDIC premiums and assessments		718			1,313			2,129			2,788
Merger-related expenses		-			1,505			-			1,580
Other operating expense		5,199			4,634			14,392			13,705
Total noninterest expense		17,429			17,768			50,099			49,003
Income (loss) before income taxes		8,296			(21,335	)		23,008			(10,572	)
Income tax expense (benefit)		1,743			(9,783	)		6,046			(6,617	)
Net income (loss)		6,553			(11,552	)		16,962			(3,955	)
Dividends on preferred stock		-			1,011			-			2,160
Net income (loss) available to common shareholders	$	6,553		$	(12,563	)	$	16,962		$	(6,115	)
Per Share
Basic earnings (loss) per common share	$	0.37		$	(0.72	)	$	0.95		$	(0.44	)
Diluted earnings (loss) per common share	$	0.37		$	(0.72	)	$	0.95		$	(0.44	)
Weighted average shares outstanding:
Basic		17,808,348			17,427,434			17,787,233			13,918,599
Diluted		17,832,882			17,427,434			17,812,895			13,918,599
For the period:
Return on average assets		1.14	%		-2.20	%		1.00	%		-0.37	%
Return on average common equity		9.49	%		-19.25	%		8.49	%		-3.46	%
Cash dividends per common share	$	0.10		$	0.10		$	0.30		$	0.30

(Unaudited)	As of and for the Quarter Ended
(In Thousands, Except Share and Per Share Data)	September 30,		June 30,			March 31,		December 31,			September 30,
	2010		2010			2010		2009			2009
Interest Income
Interest and fees on loans held for investment	$	21,440	$	20,997		$	21,354	$	22,085		$	21,064
Interest on securities – taxable		2,895		3,730			3,786		4,190			4,562
Interest on securities – nontaxable		1,451		1,394			1,426		1,445			1,449
Interest on federal funds sold and deposits		54		34			46		32			55
Total interest income		25,840		26,155			26,612		27,752			27,130
Interest Expense
Interest on deposits		4,872		5,106			5,502		6,155			6,998
Interest on borrowings		2,371		2,507			2,491		2,635			2,596
Total interest expense		7,243		7,613			7,993		8,790			9,594
Net interest income		18,597		18,542			18,619		18,962			17,536
Provision for loan losses		3,810		3,596			3,665		7,282			3,819
Net interest income after provision
for loan losses		14,787		14,946			14,954		11,680			13,717
Noninterest Income
Wealth management income		909		1,012			885		1,059			971
Service charges on deposit accounts		3,457		3,347			2,992		3,585			3,659
Other service charges and fees		1,244		1,250			1,281		1,248			1,156
Insurance commissions		1,663		1,389			2,201		1,465			1,567
Net impairment losses recognized in earnings		-		(185	)		-		(44,067	)		(30,811	)
Securities gains (losses)		2,574		1,201			250		(14,603	)		866
Acquisition gain		-		-			-		-			4,493
Other operating income		1,091		890			969		983			815
Total noninterest income (loss)		10,938		8,904			8,578		(50,330	)		(17,284	)
Noninterest Expense
Salaries and employee benefits		8,753		8,487			7,969		8,254			7,860
Occupancy expense of bank premises		1,573		1,570			1,709		1,687			1,266
Furniture and equipment expense		926		918			904		988			928
Amortization of intangible assets		260		253			256		277			262
FDIC premiums and assessments		718		710			701		1,474			1,313
Merger-related expenses		-		-			-		146			1,505
Other operating expense		5,199		4,660			4,533		4,802			4,634
Total noninterest expense		17,429		16,598			16,072		17,628			17,768
Income (loss) before income taxes		8,296		7,252			7,460		(56,278	)		(21,335	)
Income tax expense (benefit)		1,743		2,121			2,182		(21,537	)		(9,783	)
Net income (loss)		6,553		5,131			5,278		(34,741	)		(11,552	)
Dividends on preferred stock		-		-			-		-			1,011
Net income (loss) available to
common shareholders	$	6,553	$	5,131		$	5,278	$	(34,741	)	$	(12,563	)
Per Share
Basic earnings (loss) per common share	$	0.37	$	0.29		$	0.30	$	(1.96	)	$	(0.72	)
Diluted earnings (loss) per common share	$	0.37	$	0.29		$	0.30	$	(1.96	)	$	(0.72	)
Cash dividends per common share	$	0.10	$	0.10		$	0.10	$	-		$	0.10
Weighted average shares outstanding:
Basic		17,808,348		17,787,325			17,765,556		17,687,413			17,427,434
Diluted		17,832,882		17,805,393			17,784,449		17,687,413			17,427,434

	Three Months Ended						Nine Months Ended
(Unaudited)	September 30,						September 30,
(In Thousands, Except Per Share Data)	2010			2009			2010			2009

Net income (loss), GAAP	$	6,553		$	(11,552	)	$	16,962		$	(3,955	)
Non-GAAP adjustments:
Security gains		(2,574	)		(866	)		(4,025	)		(2,930	)
Acquisition gain		-			(4,493	)		-			(4,493	)
Merger-related expenses		-			1,505			-			1,580
FHLB debt prepayment fees		-			-			-			88
Other-than-temporary security impairments		-			30,811			185			34,796
FDIC special assessments		-			-			-			988
Other non-core items		1,061			525			2,734			1,558
Total adjustments to core earnings		(1,513	)		27,482			(1,106	)		31,587
Tax effect		(567	)		10,188			(415	)		11,717
Core earnings, non-GAAP	$	5,607		$	5,742		$	16,271		$	15,915

Core return on average assets		0.98	%		1.00	%		0.96	%		0.96	%
Core return on average equity		8.12	%		8.80	%		8.15	%		8.99	%
Core diluted earnings per share	$	0.31		$	0.33		$	0.91		$	1.14

	Three Months Ended						Nine Months Ended
(Unaudited)	September 30,						September 30,
(In Thousands)	2010			2009			2010			2009

Noninterest expense, GAAP	$	17,429		$	17,768		$	50,099		$	49,003
Non-GAAP adjustments:
Merger-related expenses		-			(1,505	)		-			(1,580	)
FHLB debt prepayment fees		-			-			-			(88	)
Other non-core items		(1,061	)		(524	)		(2,734	)		(2,546	)
Adjusted noninterest expense		16,368			15,739			47,365			44,789

Net interest income, GAAP		18,597			17,536			55,758			50,290
Noninterest income (loss), GAAP		10,938			(17,284	)		28,420			(3,340	)
Non-GAAP adjustments:
Tax-equivalency adjustment		819			793			2,422			2,482
Security gains		(2,574	)		(866	)		(4,025	)		(2,930	)
Other-than-temporary security impairments		-			30,811			185			34,796
Acquisition gain		-			(4,493	)		-			(4,493	)
Adjusted net interest and noninterest income		27,780			26,497			82,760			76,805

Efficiency Ratio		58.92	%		59.40	%		57.23	%		58.32	%

	For the Quarter Ended
(Unaudited)	September 30,			June 30,			March 31,			December 31,			September 30,
(Dollars In Thousands)	2010			2010			2010			2009			2009

Cash and due from banks	$	130,401		$	50,922		$	74,962		$	97,641		$	51,905
Interest-bearing deposits with banks		1,363			25,609			12,744			3,700			3,352
Securities available-for-sale		480,587			502,866			524,297			486,057			575,800
Securities held-to-maturity		5,931			6,468			7,155			7,454			7,452
Loans held for sale		3,386			2,141			1,494			11,576			4,376
Loans held for investment, net of unearned income		1,398,251			1,399,885			1,390,874			1,393,931			1,396,617
Less allowance for loan losses		26,420			25,011			24,508			24,277			19,710
Net loans		1,375,217			1,377,015			1,367,860			1,381,230			1,381,283
Premises and equipment		56,042			56,407			56,772			56,946			57,695
Other real estate owned		5,501			7,108			4,740			4,578			3,955
Interest receivable		7,899			7,859			8,630			8,610			9,046
Intangible assets		91,165			90,757			90,805			91,061			90,134
Other assets		143,319			121,835			130,974			136,006			116,303
Total Assets	$	2,297,425		$	2,246,846		$	2,278,939		$	2,273,283		$	2,296,925
Deposits:
Demand	$	216,167		$	205,731		$	205,810		$	208,244		$	198,107
Interest-bearing demand		270,927			244,889			246,513			231,907			216,184
Savings		425,661			404,820			427,883			381,381			351,450
Time		744,468			757,979			775,405			824,428			896,716
Total Deposits		1,657,223			1,613,419			1,655,611			1,645,960			1,662,457
Interest, taxes and other liabilities		21,377			21,865			21,912			22,498			24,374
Securities sold under agreements to repurchase		153,413			147,772			144,381			153,634			147,042
FHLB and other indebtedness		191,209			195,865			195,873			198,924			198,932
Total Liabilities		2,023,222			1,978,921			2,017,777			2,021,016			2,032,805

Common stock		18,083			18,083			18,083			18,083			18,083
Additional paid-in capital		189,811			190,259			190,650			190,967			192,799
Retained earnings		78,385			73,613			70,262			66,760			101,504
Treasury stock, at cost		(7,729	)		(8,583	)		(9,342	)		(9,891	)		(12,768	)
Accumulated other comprehensive loss		(4,347	)		(5,447	)		(8,491	)		(13,652	)		(35,498	)
Total Stockholders' Equity		274,203			267,925			261,162			252,267			264,120
Total Liabilities and
Stockholders' Equity	$	2,297,425		$	2,246,846		$	2,278,939		$	2,273,283		$	2,296,925

Actual shares outstanding at period end		17,834,601			17,807,155			17,782,791			17,765,164			17,680,328
Book value per common share at period end	$	15.37		$	15.05		$	14.69		$	14.20		$	14.94
Tangible book value per common share
at period end (1)	$	10.26		$	9.95		$	9.58		$	9.07		$	9.84

(Unaudited)	As of and for the Quarter Ended
(Dollars in Thousands)	September 30,			June 30,			March 31,			December 31,			September 30,
	2010			2010			2010			2009			2009
Summary of Loan Loss Experience
Allowance for loan losses:
Beginning balance	$	25,011		$	24,508		$	24,277		$	19,710		$	18,543
Provision for loan losses		3,810			3,596			3,665			7,282			3,819
Charge-offs		(2,651	)		(3,373	)		(3,732	)		(2,954	)		(2,990	)
Recoveries		250			280			298			239			338
Net charge-offs		(2,401	)		(3,093	)		(3,434	)		(2,715	)		(2,652	)
Ending balance	$	26,420		$	25,011		$	24,508		$	24,277		$	19,710

Summary of Asset Quality
Non-accrual loans	$	16,645		$	17,668		$	17,477		$	17,527		$	12,278
Troubled debt restructurings		7,904			1,206			1,041			1,390			2,319
Loans 90 days or more past due and still accruing		-			-			-			-			-
Total non-performing loans		24,549			18,874			18,518			18,917			14,597

Other real estate owned		5,501			7,108			4,740			4,578			3,955
Total non-performing assets	$	30,050		$	25,982		$	23,258		$	23,495		$	18,552

Restructured loans performing in accordance with terms	$	849		$	1,557		$	2,050		$	2,062		$	570

Asset Quality Ratios
Non-performing loans as a percentage of loans held for investment		1.76	%		1.35	%		1.33	%		1.36	%		1.05	%
Non-performing assets as a percentage of total assets		1.31	%		1.16	%		1.02	%		1.03	%		0.81	%
Annualized net charge-offs as a percentage of average loans held for investment		0.68	%		0.89	%		1.00	%		0.77	%		0.77	%
Allowance for loan losses as a percentage of loans held for investment		1.89	%		1.79	%		1.76	%		1.74	%		1.41	%
Ratio of allowance for loan losses to non-performing loans		1.08			1.33			1.32			1.28			1.35

	As of September 30, 2010
(Unaudited)					Non-accrual
(Dollars in Thousands)	Loans		Non-accrual		Loans to Loans
	Outstanding		Loans		Outstanding
Commercial
Commercial & industrial	$	110,573	$	524		0.47	%
Agriculture		1,391		-		0.00	%
Total commercial		111,964		524		0.47	%

Commercial real estate
Construction, land development & vacant land		115,029		1,821		1.58	%
Non-owner occupied		204,184		2,223		1.09	%
Owner occupied		150,368		3,033		2.02	%
Farmland		37,997		-		0.00	%
Total commercial real estate		507,578		7,077		1.39	%

Consumer		63,186		100		0.16	%

Residential real estate
Residential		533,976		5,544		1.04	%
Multi-family		67,638		1,978		2.92	%
Home equity lines		113,909		1,422		1.25	%
Total residential		715,523		8,944		1.25	%

Total loans	$	1,398,251	$	16,645		1.19	%

(Unaudited)	As of and for the Quarter Ended
(Dollars in Thousands)	September 30,			June 30,			March 31,			December 31,			September 30,
	2010			2010			2010			2009			2009
Ratios
Return on average assets		1.14	%		0.91	%		0.95	%		-6.02	%		-2.20	%
Return on average common equity		9.49	%		7.73	%		8.32	%		-51.69	%		-19.25	%
Net interest margin		3.87	%		3.92	%		4.02	%		3.92	%		3.68	%
Efficiency ratio for the quarter (non-GAAP)		58.92	%		58.26	%		54.53	%		61.29	%		59.40	%
Efficiency ratio year-to-date (non-GAAP)		57.23	%		56.38	%		54.53	%		59.10	%		58.32	%
Equity as a percent of total assets at end of period		11.94	%		11.92	%		11.46	%		11.10	%		11.50	%
Average earning assets as a percentage of
average total assets		87.67	%		87.53	%		87.38	%		87.46	%		87.19	%
Average loans as a percentage of average deposits		85.59	%		85.19	%		85.08	%		85.13	%		83.25	%

Average Balances
Investments	$	503,686		$	505,808		$	488,255		$	549,386		$	544,060
Loans		1,404,746			1,397,528			1,395,669			1,406,497			1,362,603
Earning assets		1,990,953			1,976,118			1,960,511			2,001,576			1,978,626
Total assets		2,270,984			2,257,591			2,243,786			2,288,530			2,269,427
Deposits		1,641,339			1,640,432			1,640,424			1,652,082			1,636,744
Interest bearing deposits		1,433,770			1,433,039			1,441,359			1,452,369			1,437,763
Borrowings		342,497			340,001			340,720			346,990			347,292
Interest bearing liabilities		1,776,267			1,773,041			1,782,079			1,799,359			1,785,055
Equity		274,001			266,218			257,419			266,658			258,961
Tax equivalent net interest income		19,416			19,333			19,432			19,778			18,329

	Three Months Ended September 30,
	2010							2009
(Unaudited)					Yield/							Yield/
(Dollars in Thousands)	Average		Interest		Rate			Average		Interest		Rate
	Balance		(1)		(1)			Balance		(1)		(1)
Earning assets
Loans held for investment (2)	$	1,404,746	$	21,478		6.07	%	$	1,362,603	$	21,078		6.14	%
Securities available-for-sale		497,602		4,999		3.99	%		536,485		6,636		4.91	%
Securities held-to-maturity		6,084		128		8.35	%		7,575		154		8.07	%
Interest-bearing deposits with banks		82,521		54		0.26	%		71,963		55		0.30	%
Total earning assets		1,990,953		26,659		5.31	%		1,978,626		27,923		5.60	%
Other assets		280,031							290,801
Total	$	2,270,984						$	2,269,427
Interest-bearing liabilities
Interest-bearing demand deposits	$	257,560	$	274		0.42	%	$	209,569	$	110		0.21	%
Savings deposits		423,827		672		0.63	%		339,601		639		0.75	%
Time deposits		752,383		3,926		2.07	%		888,593		6,249		2.79	%
Retail repurchase agreements		100,217		245		0.97	%		101,065		333		1.31	%
Wholesale repurchase agreements		50,000		471		3.74	%		50,000		474		3.76	%
FHLB borrowings & other long-term debt		192,280		1,655		3.41	%		196,227		1,789		3.62	%
Total interest-bearing liabilities		1,776,267		7,243		1.62	%		1,785,055		9,594		2.13	%
Noninterest-bearing demand deposits		207,569							198,981
Other liabilities		13,147							26,430
Stockholders' equity		274,001							258,961
Total	$	2,270,984						$	2,269,427
Net interest income, tax-equivalent			$	19,416						$	18,329
Net interest rate spread (3)						3.69	%						3.47	%
Net interest margin (4)						3.87	%						3.68	%

	Nine Months Ended September 30,
	2010							2009
(Unaudited)					Yield/							Yield/
(Dollars in Thousands)	Average		Interest		Rate			Average		Interest		Rate
	Balance		(1)		(1)			Balance		(1)		(1)
Earning assets
Loans held for investment (2)	$	1,399,347	$	63,913		6.11	%	$	1,308,380	$	60,663		6.20	%
Securities available-for-sale		492,603		16,561		4.49	%		535,710		21,378		5.34	%
Securities held-to-maturity		6,713		421		8.38	%		7,954		490		8.24	%
Interest-bearing deposits with banks		77,319		134		0.23	%		67,819		133		0.26	%
Total earning assets		1,975,982		81,029		5.48	%		1,919,863		82,664		5.76	%
Other assets		282,628							289,013
Total	$	2,258,610						$	2,208,876
Interest-bearing liabilities
Interest-bearing demand deposits	$	247,596	$	724		0.39	%	$	199,235	$	270		0.18	%
Savings deposits		419,550		2,284		0.73	%		323,387		1,836		0.76	%
Time deposits		768,882		12,472		2.17	%		864,503		19,535		3.02	%
Retail repurchase agreements		95,494		773		1.08	%		103,000		1,057		1.37	%
Wholesale repurchase agreements		50,000		1,402		3.75	%		50,000		1,449		3.87	%
FHLB borrowings & other long-term debt		195,586		5,194		3.55	%		206,643		5,745		3.72	%
Total interest-bearing liabilities		1,777,108		22,849		1.72	%		1,746,768		29,892		2.29	%
Noninterest-bearing demand deposits		204,706							199,986
Other liabilities		9,799							25,517
Stockholders' equity		266,997							236,605
Total	$	2,258,610						$	2,208,876
Net interest income, tax-equivalent			$	58,180						$	52,772
Net interest rate spread (3)						3.76	%						3.47	%
Net interest margin (4)						3.94	%						3.68	%

FOR IMMEDIATE RELEASE:	FOR MORE INFORMATION,
October 21, 2010	CONTACT:	David D. Brown
		(276) 326-9000