Exhibit 99.1

	- NEWS RELEASE -
Date:	April 17, 2006
Contact:	Michael G. Carlton
	President and CEO
	Bruce W. Elder
	Vice President
	(919) 460-7770

Crescent Financial Corporation

Announces 53% Increase in Comparative First Quarter Earnings and 27%

Increase in Earnings Per Share

CARY, N.C. – Crescent Financial Corporation (NasdaqNM: CRFN), parent company of Crescent State Bank today announced unaudited net income for the quarter ended March 31, 2006 of $982,000 reflecting a 53% increase over net income of $641,000 for the prior year quarter. Diluted earnings per share for the current three-month period was $.19 compared to diluted earnings per share of $.15 for the prior year period reflecting a 27% increase. The percent increase in earnings per share and the increase in earnings were not comparable due to the issuance of 848,000 shares during the fourth quarter of 2005.

The increase in earnings resulted from strong earning asset growth and an improved net interest margin due to rising interest rates. Net interest income increased by 34% from $3.0 million in the first quarter of 2005 to $4.1 million in the current quarter of 2006. Solid growth in service charges and other deposit service fees allowed non-interest income to increase by 9% from $544,000 to $596,000 despite decreases in mortgage loan origination and brokerage revenues. Non-interest expenses increased by 19% from $2.4 million to $2.9 million primarily in the areas of personnel, occupancy and data processing expenses as the Company continued to expand its franchise. During the past year, the Company opened one new full-service branch office, moved a branch office into a permanent building, opened a loan production office and took occupancy of a new Operations facility. The provision for loan losses was $270,000 during the current quarter compared with $204,000 for the prior year period.

Crescent Financial Corporation reported total assets on March 31, 2006 of $445 million reflecting a 26% increase over total assets of $354 million on March 31, 2005. Total net loans increased by 28% from $274 million a year ago to $351 million at March 31, 2006. Total deposits increased 23% from $285 million to $350 million and total borrowings increased by 26% from $40 million to $51 million. Total stockholders’ equity grew by 57% from $27 million to $42 million at March 31, 2006 due in large part to the equity offering in the fourth quarter of 2005.

Mike Carlton, President and CEO, stated, “We are very pleased to end the first quarter on such a positive note. Thus far, we have been able to enhance the franchise through branch expansion, while continuing to post solid earnings. The 53% net income growth over the prior year quarter further validates that our strategic actions to date have been successful. Today, we announced the opening of our first branch office in Raleigh, North Carolina. As the year progresses, we will continue to evaluate other expansion opportunities. We anticipate completing the recently announced merger with Port City Capital Bank of Wilmington, North Carolina in the third quarter of 2006. We are confident that these initiatives will position us well for continued growth and prosperity.”

Crescent State Bank is a state chartered bank operating ten banking offices in Cary (2), Apex, Clayton and Holly Springs, Southern Pines, Pinehurst, Sanford, Garner and Raleigh, North Carolina. Crescent Financial Corporation stock can be found on the NASDAQ National Market trading under the symbol CRFN. Investors can access additional corporate information, product descriptions and online services through the Bank’s website at www.crescentstatebank.com.

Information in this press release contains “forward-looking statements.” These statements involve risks and uncertainties that could cause actual results to differ materially, including without limitation, the effects of future economic conditions, governmental fiscal and monetary policies, legislative and regulatory changes, the risks of changes in interest rates and the effects of competition. Additional factors that could cause actual results to differ materially are discussed in Crescent Financial Corporation’s recent filings with the Securities Exchange Commission, including but not limited to its Annual Report on Form 10-K and its other periodic reports.

Crescent Financial Corporation

Consolidated Balance Sheet

(Amounts in thousands except share and per share data)

(Unaudited)

	March 31, 2006			December 31, 2005 (a)			September 30, 2005			June 30, 2005			March 31, 2005
ASSETS
Cash and due from banks	$	10,577		$	9,403		$	12,176		$	8,652		$	7,563
Interest earning deposits with banks		571			69			593			616			329
Federal funds sold		—			—			—			14,753			482
Investment securities available for sale at fair value		59,262			55,550			53,155			52,251			51,711
Loans		355,806			328,322			322,192			301,111			278,279
Allowance for loan losses		(4,621	)		(4,351	)		(4,293	)		(4,066	)		(3,876	)
Net Loans		351,185			323,971			317,899			297,045			274,403
Accrued interest receivable		1,913			1,768			1,561			1,403			1,358
Federal Home Loan Bank stock		2,712			2,133			2,957			2,102			2,102
Bank premises and equipment		5,008			4,844			3,936			3,622			3,249
Investment in life insurance		5,533			5,483			5,434			5,384			5,333
Goodwill		3,600			3,600			3,600			3,600			3,600
Other assets		4,657			3,967			3,715			3,426			3,784
Total Assets	$	445,018		$	410,788		$	405,026		$	392,854		$	353,914
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES
Deposits
Demand	$	49,879		$	46,830		$	52,921		$	50,322		$	43,411
Savings		12,110			9,365			7,072			3,673			3,306
Money market and NOW		89,472			87,695			82,636			94,930			76,442
Time		198,103			178,191			170,120			173,945			161,964
Total Deposits		349,564			322,081			312,749			322,870			285,123
Short-term borrowings		10,775			14,964			31,314			2,213			221
Long-term debt		40,248			30,248			30,248			38,248			40,248
Accrued expenses and other liabilities		2,025			2,038			1,537			1,381			1,388
Total Liabilities		402,612			369,331			375,848			364,712			326,980
STOCKHOLDERS’ EQUITY
Common stock		5,035			5,026			4,170			4,120			3,573
Additional paid-in capital		29,513			29,406			18,574			18,219			18,708
Retained earnings		8,689			7,707			6,702			5,857			5,204
Accumulated other comprehensive loss		(831	)		(682	)		(268	)		(54	)		(551	)
Total Stockholders’ Equity		42,406			41,457			29,178			28,142			26,934
Total Liabilities and Stockholders’ Equity	$	445,018		$	410,788		$	405,026		$	392,854		$	353,914
Ending shares outstanding ( b )		5,034,710			5,026,394			4,170,494			4,120,391			4,108,937
Book value per share	$	8.42		$	8.25		$	7.00		$	6.83		$	6.55

Crescent Financial Corporation

Consolidated Income Statements

(Amounts in thousands except share and per share data)

(Unaudited)

	For the three-month period ended
	March 31, 2006			December 31, 2005			September 30, 2005			June 30, 2005			March 31, 2005
INTEREST INCOME
Loans	$	6,433		$	5,989		$	5,466		$	4,814		$	4,186
Investment securities available for sale		663			612			576			566			569
Fed funds sold and other interest		5			8			17			14			9
Total Interest Income		7,101			6,609			6,059			5,394			4,764
INTEREST EXPENSE
Deposits		2,391			2,077			1,841			1,619			1,347
Short-term borrowings		233			211			201			45			356
Long-term debt		403			383			369			405			17
Total Interest Expense		3,027			2,671			2,411			2,069			1,720
Net Interest Income		4,074			3,938			3,648			3,325			3,044
Provision for loan losses		270			60			240			303			204
Net interest income after provision for loan losses		3,804			3,878			3,408			3,022			2,840
Non-interest income
Mortgage loan origination income		145			186			237			159			172
Service charges and fees on deposit accounts		318			297			269			242			237
Realized gain/loss on sale of securities		—			—			(17	)		1			—
Other		133			192			125			181			135
Total non-interest income		596			675			614			583			544
Non-interest expense
Salaries and employee benefits		1,569			1,723			1,509			1,369			1,302
Occupancy and equipment		469			454			443			440			392
Data processing		183			170			162			162			154
Other		650			659			604			643			575
Total non-interest expense		2,871			3,006			2,718			2,614			2,423
Income before income taxes		1,529			1,547			1,304			991			961
Income taxes		547			542			459			338			320
Net income	$	982		$	1,005		$	845		$	653		$	641
NET INCOME PER COMMON SHARE ( b )
Basic	$	0.20		$	0.21		$	0.20		$	0.16		$	0.16
Diluted	$	0.19		$	0.20		$	0.19		$	0.15		$	0.15
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING ( b )
Basic		5,031,502			4,714,557			4,142,454			4,115,021			4,105,337
Diluted		5,226,799			4,918,451			4,384,392			4,369,012			4,339,019
Return on average assets		0.93	%		0.98	%		0.86	%		0.72	%		0.76	%
Return on average equity		9.38	%		10.63	%		11.62	%		9.42	%		9.50	%
Net interest margin		4.09	%		4.09	%		3.93	%		3.89	%		3.84	%
Allowance for loan losses to avg loans		1.30	%		1.33	%		1.33	%		1.35	%		1.39	%
Nonperforming loans to total loans		0.01	%		0.01	%		0.07	%		0.07	%		0.03	%
Nonperforming assets to total assets		0.01	%		0.01	%		0.05	%		0.05	%		0.02	%

(a) Derived from audited financials.

(b) Adjusted, where applicable, for the stock split effected as a 15% stock dividend paid on April 27, 2005 to stockholders of record on April 14, 2005.