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: July 21, 2009

                 The South Financial Group, Inc.            

(Exact name of registrant as specified in its charter)

South Carolina   0-15083   57-0824914  

(State or other jurisdiction (Commission (IRS Employer

of incorporation) File Number) Identification Number)

102 South Main Street, Greenville, South Carolina 29601

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (864) 255-7900

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:

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

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

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

240.14d-2(b))

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

240.13e-4(c))

Item 2.02.   Results of Operations and Financial Condition.

On July 21, 2009, The South Financial Group, Inc. (“TSFG”) issued a press release (the “Press Release”) announcing its results of operations for the quarter ended June 30, 2009. A copy of the Press Release, Quarterly Financial Data Supplement and Investor Presentation are attached hereto as Exhibits 99.1, 99.2 and 99.3, respectively, and are incorporated herein by reference.

Item 8.01. Other Events.

On July 21, 2009, The South Financial Group, Inc. (the “Company”) completed the issuance and sale of 10,000,000 shares of the Company’s common stock, $1.00 par value (the “Common Stock”) at a public offering price of $1.00 per share, pursuant to the exercise in full of the underwriter’s over-allotment option set forth in the underwriting agreement (the “Underwriting Agreement”) dated June 19, 2009 with Morgan Stanley & Co. Incorporated, as underwriter (the “Underwriter”). The shares of Common Stock were sold pursuant to the prospectus supplement, filed with the Securities and Exchange Commission (the “Commission”) on June 19, 2009, to the accompanying prospectus dated April 22, 2009, constituting a part of the Company’s Registration Statement on Form S-3 (File No. 333-157706), filed on March 5, 2009 and amended on March 27, 2009 and April 17, 2009. The net proceeds of the sale of the 10,000,000 shares of Common Stock, after underwriting discounts and commissions were $9,450,000.

The Underwriting Agreement is attached as Exhibit 1.1 hereto.

Item 9.01.   Financial Statements and Exhibits .

	Exhibit No.		Description
1.1		Underwriting Agreement, between the Company and Morgan Stanley & Co. Incorporated, dated June 19, 2009 (incorporated by reference to Exhibit 1.1 of the Company’s Current Report on Form 8-K filed June 24, 2009)
99.1		Press Release dated July 21, 2009
99.2		Quarterly Financial Data Supplement, Second Quarter 2009
99.3		Investor Presentation, Second Quarter 2009

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

THE SOUTH FINANCIAL GROUP, INC.

July 21, 2009 By: /s/William P. Crawford, Jr.

William P. Crawford, Jr.

Executive Vice President and General Counsel

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EX-99

102 South Main Street

Greenville, SC 29601

864.421.1068

The South Financial Group Reports Second Quarter Results

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2Q09 Results Reflect Credit Environment and Execution of Strategic Priorities including Building a Strong Capital Position, Maintaining Higher Loan Loss Reserves, Reducing Non-Core Assets, and Expanding the Net Interest Margin

GREENVILLE, SC – July 21, 2009 – The South Financial Group, Inc. (NASDAQ: TSFG) today reported a second quarter 2009 net loss available to common shareholders of $111.5 million, or $(1.23) per diluted share. The net loss was primarily driven by credit provisions and related costs. Excluding non-operating items, the second quarter 2009 operating loss available to common shareholders totaled $101.9 million, or $(1.12) per diluted share. Reconciliations of GAAP-reported results to operating results and year-to-date results are provided in the attached financial highlights.

Second quarter operating results reflect the following items:

• Reductions in non-core loans and securities, resulting in a smaller, more focused balance sheet, down $697 million to $12.6 billion

• Continued core deposit growth with a 2.4% linked-quarter increase (period-end)

• The execution of the first phase of our capital plan announced in mid June, with a quarter-end Tier 1 capital ratio of 12.36% and a tangible common equity ratio of 6.07%, or 7.60% assuming conversion of the convertible preferred stock

• A net interest margin of 2.96%, up 13 basis points linked-quarter

• A 3.7% linked-quarter increase in operating noninterest income, driven primarily by increases in mortgage banking income

• A decrease in operating noninterest expenses, excluding the impact of credit-related expenses and FDIC insurance premiums, of $1.4 million, or 1.8% linked-quarter

• An increase of $24.6 million for credit-related expenses and FDIC insurance premiums (excluding the $5.7 million special assessment)

• An increase in the allowance for credit losses to 3.11% of loans held for investment at June 30, 2009, up from 2.84% at March 31, 2009

• An increase in second quarter 2009 net loan charge-offs to $120.6 million, or annualized 4.91% of average loans held for investment

• Preferred dividends of $7.6 million, plus an additional negative impact of $14.0 million from converted preferred stock (compared to $6.5 million from converted preferred stock in the first quarter)

• An increase in period-end common shares outstanding to 160.2 million (from 84.8 million at March 31, 2009) due to the issuance of 75 million common shares in June

“As we expected, higher credit costs led to a net loss for the second quarter,” said H. Lynn Harton, President and Chief Executive Officer of The South Financial Group. “However, we continue to be proactive and realistic in addressing problem assets. While credit will remain challenging, we have prepared for it by building our capital position and loan loss reserves. In particular, we fortified our common capital base by the successful execution of the first phase of our capital plan.”

Harton continued, “We are also carrying out our plan to build a stronger core banking franchise focused on relationship banking. In the quarter, operating revenues increased linked-quarter with increases in both net interest income and noninterest income. Our net interest margin improved, up 13 basis points, as a result of better pricing and mix improvements for loans and deposits. Noninterest income increased due to stronger mortgage banking income. We accelerated our efforts to have a smaller, more focused balance sheet by reducing non-core assets through sales of indirect loans and shared national credits. Additionally, we continued to decrease controllable operating noninterest expenses, although credit-related costs did move upward as we continue to aggressively recognize and address problem assets.”

Net Interest Income and Average Balance Sheet

Second quarter 2009 tax-equivalent net interest income increased $825,000 to $87.0 million from $86.2 million in first quarter 2009. This increase reflects a higher net interest margin and one additional day in the quarter, partially offset by a decline in average earning assets.

The tax-equivalent net interest margin for second quarter 2009 increased to 2.96%, up 13 basis points from 2.83% for first quarter 2009. The net interest margin increased as higher rate certificates of deposit, both customer and brokered, repriced downward upon renewal reflecting lower market rates and pricing discipline to drive overall funding costs down by 15 basis points linked-quarter.

Second quarter 2009 average loans decreased $313.1 million, or 3.1% linked-quarter, to $9.9 billion, and period-end loans held for investment decreased $680.7 million. For internal management purposes, TSFG segregates its loan portfolio into core ($7.4 billion at period end) and non-core ($1.9 billion at period end) loans, principally based on its ability to build a banking relationship. During second quarter 2009, core loans declined $145.9 million, or 1.9% linked-quarter, while non-core loans declined $534.8 million, or 21.8% linked-quarter ($765 million year-to-date). Going forward, TSFG plans to focus on growing core loans while decreasing its non-core loans. The decline in non-core loans was accelerated in the quarter due to the sale in June of approximately $230 million of indirect auto loans for a net gain of $501,000. Additionally, TSFG liquidated or moved to held for sale approximately $90 million of shared national credits for a loss of $4.4 million (including approximately $25 million associated with transactions that closed in July).

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Second quarter 2009 average securities declined $193.9 million, or 9.1% linked quarter, to $1.9 billion. TSFG sold U.S. government agency securities with a book value of approximately $120 million (and a 3.6% yield) for a gain of $5.4 million. In connection with this sale, TSFG also terminated $75 million (4.3% rate) in long-term repurchase agreements collateralized by those securities and recognized a loss on extinguishment of $5.4 million in second quarter 2009.

Based on period-end balances, second quarter 2009 core deposits (noninterest-bearing, interest checking, money market, and savings) increased $102.6 million, or 2.4%. Second quarter 2009 period-end customer funding (defined as total deposits less brokered deposits plus customer sweep accounts) decreased $108.0 million, principally due to declines of $154.2 million in certificates of deposits. Second quarter 2009 period-end wholesale borrowings, including brokered deposits and excluding customer sweep accounts, declined $534.9 million in connection with the sale of non-core loans and securities.

Noninterest Income

Second quarter 2009 operating noninterest income (which excludes the non-operating items mentioned below) totaled $27.7 million, up $997,000 or 3.7%, from the first quarter 2009. Linked-quarter, second quarter 2009 noninterest income benefited from recent mortgage leadership changes, which led to stronger mortgage banking income, up $845,000, from higher mortgage loan originations (up 68% linked-quarter). In addition, customer fee income, debit card income, and merchant processing income increased, while wealth management income seasonally declined.

Total noninterest income, including non-operating items, was $32.3 million for second quarter 2009, compared with $23.7 million for first quarter 2009. Non-operating noninterest income for second quarter 2009 included a $4.6 million net gain on securities, which includes $805,000 of other than temporary impairment on community bank related investments. This compares with a $3.0 million net loss on securities for first quarter 2009.

Noninterest Expenses

Operating noninterest expenses (which exclude the non-operating items mentioned below) totaled $112.8 million for second quarter 2009, a $23.1 million linked-quarter increase from $89.6 million for first quarter 2009, due to higher credit-related expenses. Credit-related noninterest expenses, which included loan collection and foreclosed asset expenses, losses on nonmortgage loans held for sale, and losses on other real estate owned, increased $22.7 million linked-quarter. This increase principally stemmed from higher losses on other real estate owned, up $12.7 million linked-quarter, from reappraisals and a policy change to write properties down to 70% of appraised value and higher losses on nonmortgage loans held for sale, up $7.6 million linked-quarter, largely from a $5.5 million loss on the write down and transfer of one loan to OREO. FDIC insurance premiums, excluding the $5.7 million special assessment, increased $1.8 million. Excluding the $24.6 million increase for these items, all other operating noninterest expenses declined $1.4 million, or 1.8%, linked-quarter.

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TSFG reduced non-credit/FDIC insurance-related operating noninterest expenses through staff reductions, elimination of merit pay raises for all employees, cost reductions associated with Project NOW (an efficiency improvement project), and other expense initiatives, which are expected to provide benefits throughout 2009. Full-time equivalent employees totaled 2,345 at June 30, 2009, down 3.5% from 2,430 at March 31, 2009. This represents the lowest FTE level since year-end 2004 and does not reflect an additional 72 FTEs eliminated effective by the end of third quarter (but notified by the end of June) and 23 FTEs associated with the sale of American Pensions, Inc. (“API”) completed on July 1, 2009. Since year-end 2008, TSFG has reduced FTEs by 6%, or 10% reflecting the positions expected to be eliminated in the third quarter.

TSFG took additional actions to reduce its cost base going forward with minimal, if any, impact on its core banking business. These include the sale of its retirement plan administration business (API) and the decisions to market the corporate campus for sale, close 3 branches and 2 other office locations, and sell the corporate airplane.

Total noninterest expenses, including non-operating items, were $136.2 million for second quarter 2009, compared with $90.2 million for first quarter 2009. Second quarter 2009 non-operating noninterest expenses included a special FDIC insurance assessment of $5.7 million, goodwill impairment related to non-banking subsidiaries of $2.5 million, severance charges of $829,000, a $3.0 million net gain on extinguishment of debt, and impairment charges for long-lived assets of $17.4 million. The impairment charges related to the corporate campus ($15.9 million), the closing of branch/office locations ($864,000), and the corporate airplane ($612,000). The net gain on extinguishment of debt included an $8.3 million nontaxable gain on the repurchase of $25 million of REIT preferred stock at 66% of par, partially offset by a $5.4 million loss on the early termination of $75 million of long-term repurchase agreements. First quarter 2009 non-operating noninterest expenses included a $676,000 charge to adjust approximately $6.9 million of various auction rate preferred securities repurchased from brokerage customers to fair value.

Credit Quality

At June 30, 2009, nonperforming loans held for investment totaled $464.6 million, a $41.6 million increase from $422.9 million at March 31, 2009. Commercial nonaccrual loans in Florida declined by approximately $50 million this quarter, while commercial nonaccrual loans in the Carolinas increased, as expected. In addition, lot loans and consumer nonperforming loans declined for the second quarter in a row. The nonperforming asset ratio increased to 5.94% at June 30, 2009 from 5.08% at March 31, 2009 due to a $47.8 million increase in nonperforming assets to $560.7 million and a decrease in total period-end loans.

The provision for credit losses for second quarter 2009 totaled $131.3 million, compared with $142.6 million for first quarter 2009. For second quarter 2009, the provision for credit losses exceeded net loan charge-offs by $10.7 million. This increased the allowance for credit losses to $289.7 million, or 3.11% of loans held for investment, up from $283.4 million, or 2.84% of loans held for investment, at March 31, 2009. The allowance coverage of nonperforming loans held for investment totaled 0.61 times and 0.66 times at June 30, 2009 and March 31, 2009, respectively.

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Net loan charge-offs in second quarter 2009 totaled $120.6 million, or 4.91% of average loans held for investment (and included $11.7 million for loan sales), versus $109.1 million, or 4.36%, for first quarter 2009. Approximately 68%, or $82.1 million, of the second quarter 2009 net charge-offs related to commercial real estate loans, including $52.5 million for residential construction loans.

Foreclosed property increased to $95.8 million at June 30, 2009, which includes OREO of $93.9 million and personal property repossessions of $1.8 million. Approximately 50% of the OREO is located in Florida, 30% is in North Carolina, and 18% is in South Carolina. Given the decline in land values, TSFG changed its OREO policy to write-down properties to 70% of the most recent appraised value and, as a result, recorded OREO loss write-downs of $10.2 million in second quarter 2009.

Capital

TSFG’s capital ratios remained strong and exceed “well-capitalized” standards for all regulatory capital ratios for TSFG and its banking subsidiary. Tangible equity to tangible assets at June 30, 2009 totaled 10.27%, up from 10.03% at March 31, 2009. The 24 basis point increase linked-quarter was attributable to the balance sheet contraction and $69.9 million in net proceeds from the new common equity raised in June, partially offset by the second quarter 2009 net loss.

Tangible common equity to tangible assets at June 30, 2009 totaled 6.07%, or 7.60% reflecting the convertible preferred stock (both the remaining $95.5 million of Series 2008 Preferred Stock and the $94.5 million of Series 2009 Preferred Stock). Since the conversion of the Series 2009 Preferred Stock is subject to shareholder approval, the $94.5 million of preferred stock remained in preferred equity as of June 30, 2009 and is not reflected in the quarter-end common capital ratios. Tangible common book value per common share totaled $4.67 at June 30, 2009, compared with $9.31 at March 31, 2009, a decline in part associated with the issuance of 75 million shares of new common stock in June.

Second quarter 2009 preferred dividends totaled $21.6 million, including $5.2 million for the U.S. Treasury Capital Purchase Program preferred stock quarterly dividend and accretion of discount, $2.4 million for the Series 2008 Preferred Stock quarterly dividend, and an additional $14.0 million related to the early conversion of $94.5 million of Series 2008 Preferred Stock, subject to shareholder approval.

In June, TSFG announced a capital plan to bolster its common equity to cover the losses associated with the “more adverse” credit scenario used by the U.S. government in its recently completed supervisory capital assessment program (SCAP) for the country's 19 largest bank holding companies. Under this capital plan, TSFG proposed to:

• Issue $75 million of common equity in a public offering (TSFG issued $75 million in June and an additional $10 million in July in connection with the exercise of the underwriters’ over-allotment.);

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• Convert $94.5 million of the Series 2008 Preferred Stock into a new series of preferred stock, Series 2009 Preferred Stock, that automatically converts into common stock upon shareholder approval (The preferred to preferred conversion was completed in June, and shareholder approval is expected to be obtained in third quarter 2009 to permit the preferred to common conversion.);

• Exchange common stock for the remaining $95.5 million of Series 2008 Preferred Stock (This action will require shareholder approval of an increase in our authorized common stock prior to completion.);

• Convert $20 million to $30 million of certain TRUP and REIT preferred securities into common (This action will require shareholder approval of an increase in our authorized common stock prior to completion.);

• Sell ancillary businesses, not core to its operations, to add $15 million to $20 million of common capital (TSFG sold API on July 1, 2009, which added $3.1 million to Tier 1 common capital, and other sales are in process.); and

• Reduce non-core loans or securities by approximately $500 million. (TSFG reduced non-core loans (primarily indirect auto loans and shared national credits) and securities by approximately $700 million in second quarter 2009.)

Conference Call / Webcast Information

The South Financial Group will host a conference call on Wednesday, July 22^nd at 10:00 a.m. (ET) to discuss second quarter 2009 financial results. Additional material information, including forward-looking statements such as trends and projections, may be discussed during the presentation. For supplemental financial information and financial review presentation slides, please refer to the Form 8-K filed by TSFG with the Securities and Exchange Commission on July 21^st or visit the Investor Relations section of its website under the Quarterly Earnings button. To participate in the conference call or webcast, please follow the instructions listed below.

Conference Call: Please call 1-888-405-5393 or 1-517-645-6236 using the access code “The South.” A 7-day rebroadcast of the call will be available via 1-866-422-8164 or 1-203-369-0833.

Webcast:To gain access to the webcast, which will be “listen-only,” please go to www.thesouthgroup.com under the Investor Relations tab and click on the link “Webcast/The South Financial Group 2^nd Quarter Earnings Conference Call.” For those unable to participate during the live webcast, it will be archived on The South Financial Group website until August 5, 2009.

General Information

The South Financial Group is a bank holding company focused on serving small businesses, middle market companies, and retail customers in the Carolinas and Florida. At June 30, 2009, it had approximately $12.6 billion in total assets and 177 branch offices. TSFG operates Carolina First Bank, which conducts banking operations in North Carolina and South Carolina (as Carolina First Bank), in Florida (as Mercantile Bank), and on the Internet (as Bank CaroLine). At June 30, 2009, approximately 46% of TSFG’s total customer deposits were in South Carolina, 42% were in Florida, and 12% were in North Carolina. Investor information is available at www.thesouthgroup.com.

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Explanation of TSFG’s Use of Certain Unaudited Non-GAAP Financial Measures and Forward-Looking Statements

This press release contains financial information determined by methods other than Generally Accepted Accounting Principles (“GAAP”). The attached financial highlights provide reconciliations between GAAP net income (loss) and operating earnings (loss), which exclude gains or losses on certain items deemed not to reflect core operations. TSFG uses these non-GAAP measures in its analysis of TSFG’s performance and believes presentations of “operating” financial measures provide useful supplemental information, a clearer understanding of TSFG’s performance, and better reflect TSFG’s core operating activities. Management utilizes non-GAAP measures in the calculation of certain of TSFG’s ratios, in particular, to analyze on a consistent basis over time the performance of what it considers to be its core operations. TSFG believes the non-GAAP measures enhance investors’ understanding of TSFG’s business and performance. These measures are also useful in understanding performance trends and facilitate comparisons with the performance of other financial institutions. The limitations associated with operating measures and cash basis information are the risk that persons might disagree as to the appropriateness of items comprising these measures and that different companies might calculate these measures differently. Management compensates for these limitations by providing detailed reconciliations between GAAP and operating measures. These disclosures should not be considered an alternative to GAAP.

This news release contains forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995) that are provided to assist in the understanding of anticipated future financial performance. These statements (as well as other forward-looking statements that may be made by management in the related conference call) include, but are not limited to, descriptions of management's plans, expectations, goals, projections, and statements, which are subject to numerous assumptions, risks, and uncertainties. They also include such items as return goals, loan growth, loan sales, customer funding growth, expense control, income tax rate, expected financial results for acquisitions, noninterest income, adequacy of capital and future capital levels, factors that will affect credit quality and the net interest margin, effectiveness of its hedging strategies, risks and effects of changes in interest rates, effects of future economic conditions, and market performance. However, such statements necessarily involve risks and uncertainties and there are a number of factors – many of which are beyond TSFG’s control -- that could cause the actual conditions, events, or results to differ materially from those in such statements. For a discussion of certain factors that may cause such forward-looking statements to differ materially from TSFG’s actual results, please refer to TSFG’s filings with the Securities and Exchange Commission. The South Financial Group undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this release.

CONTACT:

James R. Gordon, Senior EVP & Chief Financial Officer (864) 552-9050

Mary M. Gentry, EVP – Investor Relations (864) 421-1068

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PAGE 1, FINANCIAL HIGHLIGHTS THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES (dollars in thousands, except share data) (unaudited)
	Three Months Ended									% Change 6/30/09 vs.
	6/30/09			3/31/09			6/30/08			3/31/09			3/31/09 Annualized			6/30/08
EARNINGS SUMMARY
Net interest income (tax-equivalent)	$	87,046		$	86,221		$	101,540			1.0	%		3.8	%		(14.3	)%
Less: tax-equivalent adjustment		1,116			1,203			1,335			(7.2	)		(29.0	)		(16.4	)
Net interest income		85,930			85,018			100,205			1.1			4.3			(14.2	)
Provision for credit losses		131,337			142,627			63,763			(7.9	)		(31.7	)		106.0
Noninterest income:
Operating noninterest income (noninterest income, excluding non-operating items)		27,692			26,695			30,311			3.7			15.0			(8.6	)
Gain (loss) on securities		4,580			(2,954	)		1,876			n/m			n/m			n/m
Non-operating noninterest income (loss)		4,580			(2,954	)		1,876			n/m			n/m			n/m
Total noninterest income		32,272			23,741			32,187			35.9			144.1			0.3
Noninterest expenses:
Operating noninterest expenses (noninterest expenses, excluding non-operating items)		112,763			89,617			84,670			25.8			103.6			33.2
Goodwill impairment		2,511			—			—			n/m			n/m			n/m
Employment contracts and severance		829			—			2,299			n/m			n/m			n/m
Impairment of long lived assets		17,376			—			—			n/m			n/m			n/m
FDIC special assessment		5,700			—			—			n/m			n/m			n/m
Branch acquisition and conversion costs		—			—			731			n/m			n/m			n/m
Gain on early extinguishment of debt		(2,991	)		(52	)		(83	)		n/m			n/m			n/m
Loss on repurchase of auction rate securities		—			676			—			n/m			n/m			n/m
Non-operating noninterest expenses		23,425			624			2,947			n/m			n/m			n/m
Total noninterest expenses		136,188			90,241			87,617			50.9			204.2			55.4
Income (loss) before income taxes		(149,323	)		(124,109	)		(18,988	)		n/m			n/m			n/m
Income tax expense (benefit)		(59,647	)		(49,706	)		(8,056	)		n/m			n/m			n/m
Net income (loss)		(89,676	)		(74,403	)		(10,932	)		n/m			n/m			n/m
Preferred stock dividends and other (1)		(21,809	)		(16,408	)		(5,840	)		n/m			n/m			n/m
Net income (loss) available to common shareholders	$	(111,485	)	$	(90,811	)	$	(16,772	)		n/m	%		n/m	%		n/m	%
Earnings:
Operating earnings (loss)	$	(80,076	)	$	(72,167	)	$	(10,262	)		n/m	%		n/m	%		n/m	%
Operating earnings (loss) available to common shareholders		(101,885	)		(88,575	)		(16,102	)		n/m			n/m			n/m
Per common share data:
Basic earnings (loss)	$	(1.23	)	$	(1.10	)	$	(0.23	)		n/m	%		n/m	%		n/m	%
Diluted earnings (loss)		(1.23	)		(1.10	)		(0.23	)		n/m			n/m			n/m
Operating earnings (loss) available to common shareholders, diluted		(1.12	)		(1.08	)		(0.22	)		n/m			n/m			n/m
Cash dividends declared per common share		0.01			0.01			0.01			—			—			—
Average common shares outstanding:
Basic		90,986,862			82,223,190			72,611,024			10.7	%		42.8	%		25.3	%
Diluted		90,986,862			82,223,190			72,611,024			10.7			42.8			25.3
PERFORMANCE RATIOS:
Total revenue:
GAAP (2)	$	118,202		$	108,759		$	132,392			8.7	%		34.8	%		(10.7	)%
Operating (3)		114,738			112,916			131,851			1.6			6.5			(13.0	)
Return on average assets(4)		(2.75	)%		(2.23	)%		(0.32	)%
Return on average common equity (5)		(43.79	)		(34.47	)		(4.97	)
Return on average equity(4)		(23.36	)		(18.85	)		(2.94	)
Net interest margin (tax-equivalent)		2.96			2.83			3.24
Cash operating efficiency ratio (6)		77.69			76.49			63.01

(1)	For the quarters ended June 30, 2009 and March 31, 2009, includes $14.0 million and $6.5 million, respectively, for the value of common shares recorded as an inducement for early conversion of mandatorily convertible preferred stock.
(2)	The sum of net interest income and noninterest income.
(3)	The sum of tax-equivalent net interest income and operating noninterest income.
(4)	Return on average assets and return on average equity are calculated as net income (loss) divided by either average assets or average total equity.
(5)	Return on average common equity is calculated as net income (loss) available to common shareholders divided by average common equity.
(6)	The cash operating efficiency ratio is calculated as operating noninterest expenses before gain/loss on OREO, loss on nonmortgage loans held for sale, and amortization of intangibles divided by the sum of tax-equivalent net interest income and operating noninterest income.
A Quarterly Financial Data Supplement is available in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

PAGE 2, FINANCIAL HIGHLIGHTS
THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
(dollars in thousands, except share data) (unaudited)

	Six Months Ended
	6/30/09			6/30/08			% Change
EARNINGS SUMMARY
Net interest income (tax-equivalent)	$	173,267		$	195,696			(11.5	)%
Less: tax-equivalent adjustment		2,319			2,785			(16.7	)
Net interest income		170,948			192,911			(11.4	)
Provision for credit losses		273,964			137,055			99.9
Noninterest income:
Operating noninterest income (noninterest income, excluding non-operating items)		54,387			59,114			(8.0	)
Gain (loss) on securities		1,626			2,272			n/m
Gain on Visa IPO share redemption		—			1,904			n/m
Non-operating noninterest income (loss)		1,626			4,176			n/m
Total noninterest income		56,013			63,290			(11.5	)
Noninterest expenses:
Operating noninterest expenses (noninterest expenses, excluding non-operating items)		202,380			164,921			22.7
Goodwill impairment		2,511			188,431			n/m
Employment contracts and severance		829			2,299			n/m
Impairment of long lived assets		17,376			—			n/m
FDIC special assessment		5,700			—			n/m
Branch acquisition and conversion costs		—			731			n/m
(Gain) loss on early extinguishment of debt		(3,043	)		464			n/m
Visa-related litigation		—			(863	)		n/m
Loss on repurchase of auction rate securities		676			—			n/m
Non-operating noninterest expenses		24,049			191,062			n/m
Total noninterest expenses		226,429			355,983			(36.4	)
Income (loss) before income taxes		(273,432	)		(236,837	)		n/m
Income tax expense (benefit)		(109,353	)		(24,613	)		n/m
Net income (loss)		(164,079	)		(212,224	)		n/m
Preferred stock dividends and other (1)		(38,217	)		(5,977	)		n/m
Net income (loss) available to common shareholders	$	(202,296	)	$	(218,201	)		n/m	%
Earnings:
Operating earnings (loss)	$	(152,243	)	$	(24,758	)		n/m	%
Operating earnings (loss) available to common shareholders		(190,460	)		(30,735	)		n/m
Per common share data:
Basic earnings (loss)	$	(2.34	)	$	(3.01	)		n/m	%
Diluted earnings (loss)		(2.34	)		(3.01	)		n/m
Operating earnings (loss) available to common shareholders, diluted		(2.20	)		(0.42	)		n/m
Cash dividends declared per common share		0.02			0.20			(90.0	)
Average common shares outstanding:
Basic		86,629,235			72,530,399			19.4	%
Diluted		86,629,235			72,530,399			19.4
PERFORMANCE RATIOS:
Total revenue:
GAAP (2)	$	226,961		$	256,201			(11.4	)%
Operating (3)		227,654			254,810			(10.7	)
Return on average assets(4)		(2.48	)%		(3.08	)%
Return on average common equity (5)		(39.05	)		(30.03	)
Return on average equity(4)		(21.07	)		(27.89	)
Net interest margin (tax-equivalent)		2.89			3.16
Cash operating efficiency ratio (6)		77.09			63.38

(1)	For the six months ended June 30, 2009, includes $20.5 million for the value of common shares recorded as an inducement for early conversion of mandatorily convertible preferred stock.
(2)	The sum of net interest income and noninterest income.
(3)	The sum of tax-equivalent net interest income and operating noninterest income.
(4)	Return on average assets and return on average equity are calculated as net income (loss) divided by either average assets or average total equity.
(5)	Return on average common equity is calculated as net income (loss) available to common shareholders divided by average common equity.
(6)	The cash operating efficiency ratio is calculated as operating noninterest expenses before gain/loss on OREO, loss on nonmortgage loans held for sale, and amortization of intangibles divided by the sum of tax-equivalent net interest income and operating noninterest income.
A Quarterly Financial Data Supplement is available in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

PAGE 3, FINANCIAL HIGHLIGHTS

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

(dollars in thousands, except share data) (unaudited)

										% Change 6/30/09 vs.
	6/30/09			3/31/09			6/30/08			3/31/09			3/31/09 Annualized			6/30/08
BALANCE SHEET DATA (Averages - Three Months Ended)
Total assets	$	13,085,556		$	13,556,128		$	13,868,149			(3.5	)%		(13.9	)%		(5.6	)%
Intangible assets		(244,040	)		(245,341	)		(487,440	)		(0.5	)		(2.1	)		(49.9	)
Tangible assets		12,841,516			13,310,787			13,380,709			(3.5	)		(14.1	)		(4.0	)
Loans		9,875,268			10,188,368			10,458,571			(3.1	)		(12.3	)		(5.6	)
Securities (1)		1,926,894			2,120,749			2,099,257			(9.1	)		(36.7	)		(8.2	)
Total earning assets		11,802,417			12,309,315			12,578,084			(4.1	)		(16.5	)		(6.2	)
Noninterest-bearing deposits		1,074,739			1,021,400			1,079,390			5.2			20.9			(0.4	)
Total deposits (2)		9,265,643			9,368,989			9,534,806			(1.1	)		(4.4	)		(2.8	)
Customer funding (3)		7,673,784			7,918,965			8,027,539			(3.1	)		(12.4	)		(4.4	)
Wholesale borrowings (4)		3,636,319			3,805,576			4,159,954			(4.4	)		(17.8	)		(12.6	)
Total funding		11,310,103			11,724,541			12,187,493			(3.5	)		(14.2	)		(7.2	)
Preferred stock		518,968			532,430			137,783			(2.5	)		(10.1	)		276.7
Common equity		1,021,053			1,068,416			1,357,598			(4.4	)		(17.8	)		(24.8	)
Shareholders’ equity		1,540,021			1,600,846			1,495,381			(3.8	)		(15.2	)		3.0
Intangible assets		(244,040	)		(245,341	)		(487,440	)		(0.5	)		(2.1	)		(49.9	)
Tangible equity		1,295,981			1,355,505			1,007,941			(4.4	)		(17.6	)		28.6
Loans/total earning assets		83.7	%		82.8	%		83.1	%
Securities/total assets		14.7			15.6			15.1
Customer funding/total funding		67.8			67.5			65.9
Wholesale borrowings/total assets		27.8			28.1			30.0
Loans/customer funding		128.7			128.7			130.3
BALANCE SHEET DATA (Averages - Year to Date)
Total assets	$	13,319,542		$	13,556,128		$	13,856,527			(1.7	)%		(7.0	)%		(3.9	)%
Intangible assets		(244,687	)		(245,341	)		(581,345	)		(0.3	)		(1.1	)		(57.9	)
Tangible assets		13,074,855			13,310,787			13,275,182			(1.8	)		(7.1	)		(1.5	)
Loans		10,030,953			10,188,368			10,347,045			(1.5	)		(6.2	)		(3.1	)
Securities (1)		2,023,286			2,120,749			2,087,498			(4.6	)		(18.4	)		(3.1	)
Total earning assets		12,054,466			12,309,315			12,449,029			(2.1	)		(8.3	)		(3.2	)
Noninterest-bearing deposits		1,048,217			1,021,400			1,081,447			2.6			10.5			(3.1	)
Total deposits (2)		9,317,030			9,368,989			9,506,183			(0.6	)		(2.2	)		(2.0	)
Customer funding (3)		7,795,697			7,918,965			8,127,465			(1.6	)		(6.2	)		(4.1	)
Wholesale borrowings (4)		3,720,480			3,805,576			4,008,918			(2.2	)		(9.0	)		(7.2	)
Total funding		11,516,177			11,724,541			12,136,383			(1.8	)		(7.1	)		(5.1	)
Preferred stock		525,662			532,430			68,892			(1.3	)		(5.1	)		663.0
Common equity		1,044,604			1,068,416			1,461,288			(2.2	)		(8.9	)		(28.5	)
Shareholders’ equity		1,570,266			1,600,846			1,530,180			(1.9	)		(7.7	)		2.6
Intangible assets		(244,687	)		(245,341	)		(581,345	)		(0.3	)		(1.1	)		(57.9	)
Tangible equity		1,325,579			1,355,505			948,835			(2.2	)		(8.9	)		39.7
Loans/total earning assets		83.2	%		82.8	%		83.1	%
Securities/total assets		15.2			15.6			15.1
Customer funding/total funding		67.7			67.5			67.0
Wholesale borrowings/total assets		27.9			28.1			28.9
Loans/customer funding		128.7			128.7			127.3

(1)	The average balances for investment securities exclude the unrealized gain/loss recorded for available for sale securities.
(2)	Total deposits include brokered deposits.
(3)	Customer funding includes total deposits less brokered deposits plus customer sweep accounts.
(4)	Wholesale borrowings include borrowings less customer sweep accounts plus brokered deposits.
A Quarterly Financial Data Supplement is available in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

PAGE 4, FINANCIAL HIGHLIGHTS

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

(dollars in thousands, except share data) (unaudited)

										% Change 6/30/09 vs.
	6/30/09			3/31/09			6/30/08			3/31/09			3/31/09 Annualized			6/30/08
BALANCE SHEET DATA (Period End)
Loans held for sale (1)	$	40,290		$	29,726		$	21,871			35.5	%		142.5	%		84.2	%
Loans held for investment		9,306,009			9,986,681			10,475,731			(6.8	)		(27.3	)		(11.2	)
Allowance for loan losses		(285,290	)		(280,156	)		(191,727	)		1.8			7.4			48.8
Allowance for credit losses		(289,680	)		(283,425	)		(193,825	)		2.2			8.9			49.5
Securities		1,949,927			2,124,320			2,013,909			(8.2	)		(32.9	)		(3.2	)
Intangible assets		240,932			244,729			487,886			(1.6	)		(6.2	)		(50.6	)
Total assets		12,588,231			13,285,247			13,976,870			(5.2	)		(21.0	)		(9.9	)
Noninterest-bearing deposits		1,099,743			1,067,953			1,107,115			3.0			11.9			(0.7	)
Total deposits (2)		9,388,652			9,227,078			9,886,369			1.8			7.0			(5.0	)
Customer funding (3)		7,663,645			7,771,607			8,032,661			(1.4	)		(5.6	)		(4.6	)
Wholesale borrowings (4)		3,194,596			3,729,536			4,208,266			(14.3	)		(57.5	)		(24.1	)
Total funding		10,858,241			11,501,143			12,240,927			(5.6	)		(22.4	)		(11.3	)
Mandatorily convertible preferred stock		190,026			190,026			250,000			—			—			(24.0	)
Perpetual preferred stock		329,380			328,523			—			0.3			1.0			n/m
Common equity		989,847			1,033,634			1,309,202			(4.2	)		(17.0	)		(24.4	)
Shareholders’ equity		1,509,253			1,552,183			1,559,202			(2.8	)		(11.1	)		(3.2	)
CAPITAL RATIOS
Tier 1 risk-based capital (preliminary)		12.36	%		12.10	%		11.05	%
Total risk-based capital (preliminary)		13.65			13.53			12.54
Leverage ratio (preliminary)		10.30			10.55			9.81
Tangible equity to tangible assets		10.27			10.03			7.94
Tangible common equity to tangible assets		6.07			6.05			6.09
-Assuming conversion of mandatorily convertible preferred (6)		7.60			7.51			7.94
SHARE DATA
Convertible preferred shares outstanding:
-Series 2008		95,526			190,026			250,000			(49.7	)%		(199.5	)%		(61.8	)%
-Series 2009		94,500			—			—			n/m			n/m			n/m
Common shares outstanding		160,248,170			84,781,160			72,795,797			89.0			357.0			120.1
-Assuming conversion of mandatorily convertible preferred (6)		198,932,903			114,015,929			111,257,335
Common book value per common share (5)	$	6.18		$	12.19		$	17.98			(49.3	)		(197.8	)		(65.6	)
Common tangible book value per common share (5)		4.67			9.31			11.28			(49.8	)		(199.9	)		(58.6	)
OPERATIONS DATA
Branch offices		177			180			180			(1.7	)%		(6.7	)%		(1.7	)%
ATMs		200			204			200			(2.0	)		(7.9	)		—
Employees (full-time equivalent)		2,345			2,430			2,572			(3.5	)		(14.0	)		(8.8	)

(1)	As of June 30, 2009 and March 31, 2009, loans held for sale include $376,000 and $12.8 million, respectively, of nonperforming loans held for sale.
(2)	Total deposits include brokered deposits.
(3)	Customer funding includes total deposits less brokered deposits plus customer sweep accounts.
(4)	Wholesale borrowings include borrowings less customer sweep accounts plus brokered deposits.
(5)	Common book value per common share is calculated as total shareholders’ equity less preferred stock divided by common shares outstanding. Common tangible book value per common share also excludes intangible assets.
(6)	As of June 30, 2009, March 31, 2009, and June 30, 2008, the shares of convertible preferred stock are mandatorily convertible into approximately 38.7 million, 29.2 million, and 38.5 million common shares, respectively.
A Quarterly Financial Data Supplement is available in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

PAGE 5, FINANCIAL HIGHLIGHTS THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES (dollars in thousands, except share data) (unaudited)
										% Change 6/30/09 vs.
	6/30/09			3/31/09			6/30/08			3/31/09			3/31/09 Annualized			6/30/08
CREDIT QUALITY
Loans held for investment	$	9,306,009		$	9,986,681		$	10,475,731			(6.8	)%		(27.3	)%		(11.2	)%
Allowance for loan losses		(285,290	)		(280,156	)		(191,727	)		1.8						48.8
Allowance for credit losses		(289,680	)		(283,425	)		(193,825	)		2.2						49.5
Nonperforming loans held for investment (1)	$	464,565		$	422,950		$	218,726			9.8	%					112.4	%
Nonperforming loans held for sale		376			12,766			—			(97.1	)					n/m
Foreclosed property (other real estate owned and personal property repossessions)		95,752			77,210			21,780			24.0						339.6
Nonperforming assets	$	560,693		$	512,926		$	240,506			9.3	%					133.1	%
Restructured loans not included in nonperforming assets (1)	$	17,291		$	11,073		$	1,425
Nonperforming loans held for investment as a % of loans held for investment		4.99	%		4.24	%		2.09	%
Nonperforming assets as a % of loans and foreclosed property		5.94			5.08			2.29
Allowance for loan losses as a % of loans HFI		3.07			2.81			1.83
Allowance for credit losses as a % of loans HFI		3.11			2.84			1.85
Allowance for loan losses to nonperforming loans HFI		0.61	x		0.66	x		0.88	x
Loans past due 90 days or more (interest accruing)	$	11,107		$	6,444		$	8,779									26.5	%
Average loans held for investment:
Three months ended		9,847,366			10,154,853			10,435,248
Year to date		10,000,260			10,154,853			10,328,336
Net loan charge-offs:
Three months ended		120,611			109,076			46,954			10.6	%					156.9	%
Year to date		229,687			109,076			71,925									219.3
Net loan charge-offs as a % of average loans held for investment (annualized):
Three months ended		4.91	%		4.36	%		1.81	%
Year to date		4.63			4.36			1.40

(1)	During first quarter 2009, TSFG began excluding restructured loans accruing interest from its nonperforming loans. Prior periods have been reclassified to conform to the current presentation.
A Quarterly Financial Data Supplement is available in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

PAGE 6, FINANCIAL HIGHLIGHTS

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

(dollars in thousands, except share data) (unaudited)

	Three Months Ended								% Change 6/30/09 vs.
	6/30/09		3/31/09			6/30/08			3/31/09			3/31/09 Annualized			6/30/08
NONINTEREST INCOME
Customer fee income	$	12,967	$	12,402		$	14,400			4.6	%		18.3	%		(10.0	)%
Wealth management income		5,477		6,574			7,099			(16.7	)		(66.9	)		(22.8	)
Mortgage banking income		2,050		1,205			1,858			70.1			281.3			10.3
Bank-owned life insurance		2,560		2,502			2,910			2.3			9.3			(12.0	)
Merchant processing income, net		817		610			809			33.9			136.1			1.0
Gain on certain derivative activities		1,085		1,135			236			(4.4	)		(17.7	)		359.7
Other		2,736		2,267			2,999			20.7			83.0			(8.8	)
Operating noninterest income (noninterest income, excluding non-operating items)		27,692		26,695			30,311			3.7			15.0			(8.6	)
Non-operating noninterest income (loss)		4,580		(2,954	)		1,876			n/m			n/m			n/m
Total noninterest income	$	32,272	$	23,741		$	32,187			35.9	%		144.1	%		0.3	%
NONINTEREST EXPENSES
Personnel expense	$	43,664	$	44,114		$	45,249			(1.0	)%		(4.1	)%		(3.5	)%
Occupancy		9,506		9,436			8,972			0.7			3.0			6.0
Furniture and equipment		6,801		6,945			6,733			(2.1	)		(8.3	)		1.0
Professional services		4,351		4,507			3,579			(3.5	)		(13.9	)		21.6
Project NOW expense		281		1,298			—			(78.4	)		(314.3	)		n/m
Advertising and business development		2,109		1,281			2,731			64.6			259.3			(22.8	)
Telecommunications		1,551		1,526			1,476			1.6			6.6			5.1
Amortization of intangibles		1,286		1,291			1,589			(0.4	)		(1.6	)		(19.1	)
Regulatory assessments		6,479		4,655			2,374			39.2			157.2			172.9
Loan collection and foreclosed asset expense		7,247		4,891			2,303			48.2			193.2			214.7
Loss on nonmortgage loans held for sale		9,461		1,838			—			n/m			n/m			n/m
(Gain) loss on OREO		12,873		124			(3	)		n/m			n/m			n/m
Other		7,154		7,711			9,667			(7.2	)		(29.0	)		(26.0	)
Operating noninterest expenses (noninterest expenses, excluding non-operating items)		112,763		89,617			84,670			25.8			103.6			33.2
Non-operating noninterest expenses		23,425		624			2,947			n/m			n/m			n/m
Total noninterest expenses	$	136,188	$	90,241		$	87,617			50.9	%		204.2	%		55.4	%
			Six Months Ended
			6/30/09			6/30/08			% Change
NONINTEREST INCOME
Customer fee income			$	25,369		$	28,036			(9.5	)%
Wealth management income				12,051			14,127			(14.7	)
Mortgage banking income				3,255			3,343			(2.6	)
Bank-owned life insurance				5,062			6,057			(16.4	)
Merchant processing income, net				1,427			1,666			(14.3	)
Gain on certain derivative activities				2,220			248			795.2
Other				5,003			5,637			(11.2	)
Operating noninterest income (noninterest income, excluding non-operating items)				54,387			59,114			(8.0	)
Non-operating noninterest income				1,626			4,176			n/m
Total noninterest income			$	56,013		$	63,290			(11.5	)%
NONINTEREST EXPENSES
Personnel expense			$	87,778		$	89,400			(1.8	)%
Occupancy				18,942			17,595			7.7
Furniture and equipment				13,746			13,116			4.8
Professional services				8,858			7,106			24.7
Project NOW expense				1,579			—			n/m
Advertising and business development				3,390			5,202			(34.8	)
Telecommunications				3,077			2,899			6.1
Amortization of intangibles				2,577			3,247			(20.6	)
Regulatory assessments				11,134			4,451			150.1
Loan collection and foreclosed asset expense				12,138			3,382			258.9
Loss on nonmortgage loans held for sale				11,299			—			n/m
Loss on OREO				12,997			184			n/m
Other				14,865			18,339			(18.9	)
Operating noninterest expenses (noninterest expenses, excluding non-operating items)				202,380			164,921			22.7
Non-operating noninterest expenses				24,049			191,062			n/m
Total noninterest expenses			$	226,429		$	355,983			(36.4	)%

A Quarterly Financial Data Supplement is available in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

PAGE 7, FINANCIAL HIGHLIGHTS

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

(dollars in thousands, except share data) (unaudited)

	Three Months Ended
	6/30/09			3/31/09			6/30/08
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
NET INCOME (LOSS), AS REPORTED (GAAP)	$	(89,676	)	$	(74,403	)	$	(10,932	)
Add: Income tax expense (benefit)		(59,647	)		(49,706	)		(8,056	)
Income (loss) before income taxes		(149,323	)		(124,109	)		(18,988	)
Non-operating items:
(Gain) loss on securities		(4,580	)		2,954			(1,876	)
Goodwill impairment		2,511			—			—
Employment contracts and severance		829			—			2,299
Impairment of long lived assets		17,376			—			—
FDIC special assessment		5,700			—			—
Branch acquisition and conversion costs		—			—			731
Gain on early extinguishment of debt		(2,991	)		(52	)		(83	)
Loss on repurchase of auction rate securities		—			676			—
PRE-TAX OPERATING EARNINGS (LOSS) (income (loss) before taxes, excluding non-operating items)		(130,478	)		(120,531	)		(17,917	)
Related income tax expense (benefit)		(50,402	)		(48,364	)		(7,655	)
OPERATING EARNINGS (LOSS) (net income (loss), excluding non-operating items)		(80,076	)		(72,167	)		(10,262	)
Preferred stock dividends and other		(21,809	)		(16,408	)		(5,840	)
OPERATING EARNINGS (LOSS) AVAILABLE TO COMMON SHAREHOLDERS (net income (loss) less preferred dividends and other, excluding non-operating items)	$	(101,885	)	$	(88,575	)	$	(16,102	)

	Six Months Ended
	6/30/09			6/30/08
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
NET INCOME (LOSS), AS REPORTED (GAAP)	$	(164,079	)	$	(212,224	)
Add: Income tax expense (benefit)		(109,353	)		(24,613	)
Income (loss) before income taxes		(273,432	)		(236,837	)
Non-operating items:
(Gain) loss on securities		(1,626	)		(2,272	)
Gain on Visa IPO share redemption		—			(1,904	)
Goodwill impairment		2,511			188,431
Employment contracts and severance		829			2,299
Impairment of long lived assets		17,376			—
FDIC special assessment		5,700			—
Branch acquisition and conversion costs		—			731
(Gain) loss on early extinguishment of debt		(3,043	)		464
Visa-related litigation		—			(863	)
Loss on repurchase of auction rate securities		676			—
PRE-TAX OPERATING EARNINGS (LOSS) (income (loss) before taxes, excluding non-operating items)		(251,009	)		(49,951	)
Related income tax expense (benefit)		(98,766	)		(25,193	)
OPERATING EARNINGS (LOSS) (net income (loss), excluding non-operating items)		(152,243	)		(24,758	)
Preferred stock dividends and other		(38,217	)		(5,977	)
OPERATING EARNINGS (LOSS) AVAILABLE TO COMMON SHAREHOLDERS (net income (loss) less preferred dividends and other, excluding non-operating items)	$	(190,460	)	$	(30,735	)

A Quarterly Financial Data Supplement is available in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

EX-99

Quarterly Financial Data Supplement (Unaudited)
Second Quarter 2009

	Page
Financial Summary	1
Consolidated Statements of Income (Loss)	2
Details for Noninterest Income and Noninterest Expenses	3
Consolidated Balance Sheets	4
Investment Securities Portfolio Analysis	5
Investment Securities Portfolio Credit Risk Profile	6
Loan Portfolio Composition Based on Loan Purpose and Loan Growth, Core vs. Non-Core	7
Summary of Credit Quality and Allowance for Credit Losses	8
Commercial Real Estate Loans	9
Types of Customer Funding and Customer Funding Growth	10
Wholesale Borrowings	11
Summary of Capital, Capital Ratios, Unrealized Gains (Losses) on Available for Sale Securities and Market Rates on Treasury Notes	12
Comparative Average Balance Sheets - Yields and Costs	13-14
GAAP to Non-GAAP Reconciliation: Earnings, ROA and ROE	15-17
GAAP to Non-GAAP Reconciliation: Noninterest income as a% of total revenue and efficiency ratios	18-20

See disclosure of explanation of TSFG’s use of certain Non-GAAP financial measures in the earnings release.

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
SECOND QUARTER 2009 FINANCIAL SUMMARY

Changes vs. prior quarter, unless indicated otherwise:
Quarterly EPS
•	Net loss available to common shareholders of $111.5 million; operating loss of $101.9 million
•	Net loss per diluted share of $1.23; operating loss per diluted share of $1.12
•	Preferred stock dividends totaled $21.8 million, up from $16.4 million for previous quarter due to deemed dividend on induced conversion of mandatorily convertible preferred stock
•	Average diluted shares of 91.0 million, up 10.7% versus prior quarter; up 25.3% versus prior year
•	Period-end common shares outstanding increased to 160.2 million from 84.8 million at March 31, 2009, due to the issuance of 75 million common shares in June
Revenue
•	Total revenue, defined as net interest income plus noninterest income, of $118.2 million
•	Operating revenues of $114.7 million, up $1.8 million
	— Non-operating items: $4.6 million net gain on securities
•	Tax-equivalent net interest income of $87.0 million, up $825,000
	— Net interest margin of 2.96%, up 13 basis points from 2.83%
	— Average earning assets of $11.8 billion, down from $12.3 billion
•	Operating noninterest income of $27.7 million, up $997,000 from prior quarter, primarily from increases in mortgage banking income; down $2.6 million from prior year
Average Balance Sheet
•	Period-end loans decreased $680.7 million or 6.8% compared to prior quarter
•	Period-end securities, down $174.4 million since prior quarter
•	Period-end customer funding, defined as total deposits less brokered deposits plus customer sweep accounts, down $108.0 million or 1.4% linked-quarter
•	Period-end wholesale borrowings, including brokered deposits and excluding customer sweep accounts, up $534.9 million or 14.3% linked-quarter
Noninterest Expenses and Operating Efficiency
•	Noninterest expenses of $136.2 million
	— Non-operating items: $3.0 million gain on early extinguishment of debt, $17.4 million impairment of long lived assets, $5.7 million FDIC special assessment, $2.5 million goodwill impairment, and $829,000 employment contracts and severance
•	Operating noninterest expenses of $112.8 million, up $23.1 million from prior quarter
	— Project NOW and other expense initiatives showing progress
	— FDIC insurance premiums (included in regulatory assessments) up $1.8 million from prior quarter; $4.1 million from prior year
	— Advertising and business development expenses up $828,000 or 64.6% from prior quarter
	— Loss on other real estate owned up $12.7 million
	— Excluding credit-related expenses and FDIC insurance premiums, down $1.4 million from prior quarter
Credit Quality
•	Nonperforming assets of $560.7 million or 5.94% of loans and foreclosed property
•	Nonperforming loans held for investment increased to $464.6 million from $422.9 million at March 31, 2009; nonperforming loans held for sale totaled $376,000
•	Net loan charge-offs of $120.6 million, or 4.91% annualized as a% of average loans held for investment
•	Provision for credit losses exceeded net loan charge-offs by $10.7 million and increased allowance
•	Allowance for credit losses of $289.7 million or 3.11% of loans held for investment, up from 2.84% prior quarter
•	Allowance coverage of nonperforming loans held for investment of 0.61 times, a decrease from 0.66 times at March 31, 2009
Capital
•	Tangible common equity to tangible asset ratio of 6.07%, or 7.60% assuming conversion of the mandatorily convertible preferred stock
•	Common tangible book value per share of $4.67, compared to $9.31 at March 31, 2009
•	After-tax unrealized gain on available for sale securities decreased $8.2 million from prior quarter
•	Tier 1 capital ratio of 12.36%, up from 12.10% at March 31, 2009; capital ratios exceed all “well capitalized” regulatory requirements

1

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(dollars in thousands, except share data) (unaudited)

	Three Months Ended
	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Interest Income
Interest and fees on loans	$	121,823		$	124,119		$	145,289		$	155,433		$	158,016
Interest and dividends on securities:
Taxable		18,140			20,548			20,575			20,186			20,591
Exempt from federal income taxes		2,072			2,234			2,351			2,422			2,479
Total interest and dividends on securities		20,212			22,782			22,926			22,608			23,070
Interest on short-term investments		—			1			10			197			106
Total interest income		142,035			146,902			168,225			178,238			181,192
Interest Expense
Interest on deposits		49,541			54,843			65,646			69,071			63,180
Interest on borrowed funds		6,564			7,041			10,946			13,548			17,807
Total interest expense		56,105			61,884			76,592			82,619			80,987
Net Interest Income		85,930			85,018			91,633			95,619			100,205
Provision for Credit Losses		131,337			142,627			122,926			84,608			63,763
Net interest income after provision for credit losses		(45,407	)		(57,609	)		(31,293	)		11,011			36,442
Noninterest Income		32,272			23,741			30,012			28,665			32,187
Noninterest Expenses		136,188			90,241			342,093			94,157			87,617
Income (loss) before income taxes		(149,323	)		(124,109	)		(343,374	)		(54,481	)		(18,988	)
Income tax expense (benefit)		(59,647	)		(49,706	)		(33,435	)		(29,526	)		(8,056	)
Net Income (Loss)		(89,676	)		(74,403	)		(309,939	)		(24,955	)		(10,932	)
Preferred stock dividends and other (1)		(21,809	)		(16,408	)		(9,424	)		(6,257	)		(5,840	)
Net Income (Loss) Available to Common Shareholders	$	(111,485	)	$	(90,811	)	$	(319,363	)	$	(31,212	)	$	(16,772	)
Average common shares outstanding, basic		90,986,862			82,223,190			74,505,656			72,755,480			72,611,024
Average common shares outstanding, diluted (2)		90,986,862			82,223,190			74,505,656			72,755,480			72,611,024
Earnings (loss) per common share, basic	$	(1.23	)	$	(1.10	)	$	(4.29	)	$	(0.43	)	$	(0.23	)
Earnings (loss) per common share, diluted		(1.23	)		(1.10	)		(4.29	)		(0.43	)		(0.23	)
Cash dividends declared per common share		0.01			0.01			0.01			0.01			0.01

(1)	For the quarters ended June 30, 2009 and March 31, 2009, includes $14.0 million and $6.5 million, respectively, for the value of common shares recorded as an inducement for early conversion of mandatorily convertible preferred stock.
(2)	Average diluted shares exclude convertible preferred stock, warrants, and outstanding equity awards since either their effect would be antidilutive or the exercise price was greater than the average market price of the common shares.

2

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
DETAILS FOR NONINTEREST INCOME AND NONINTEREST EXPENSES
(dollars in thousands) (unaudited)

	Three Months Ended
	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Noninterest Income
Service charges on deposit accounts	$	9,535		$	9,268		$	10,149		$	11,376		$	10,986
Debit card income, net		2,168			1,925			1,867			2,006			2,056
Customer service fee income		1,264			1,209			1,221			1,425			1,358
Total customer fee income		12,967			12,402			13,237			14,807			14,400
Retail investment services, net		1,646			2,010			1,751			2,294			2,120
Insurance income		1,765			2,457			2,266			2,368			2,388
Trust and investment management income		1,495			1,465			1,437			1,728			1,857
Benefits administration fees		571			642			833			813			734
Total wealth management income		5,477			6,574			6,287			7,203			7,099
Mortgage banking income		2,050			1,205			1,038			879			1,858
Bank-owned life insurance		2,560			2,502			3,939			2,881			2,910
Merchant processing income, net		817			610			697			916			809
Gain (loss) on certain derivative activities		1,085			1,135			(256	)		(199	)		236
Other		2,736			2,267			3,509			2,903			2,999
Operating noninterest income (noninterest income, excluding non-operating items)		27,692			26,695			28,451			29,390			30,311
Gain (loss) on securities		4,580			(2,954	)		1,561			(725	)		1,876
Non-operating noninterest income (loss)		4,580			(2,954	)		1,561			(725	)		1,876
Total noninterest income	$	32,272		$	23,741		$	30,012		$	28,665		$	32,187
Noninterest Expenses
Salaries and wages	$	34,739		$	35,191		$	35,348		$	37,700		$	36,136
Employee benefits		8,925			8,923			10,537			9,252			9,113
Occupancy		9,506			9,436			9,946			9,770			8,972
Furniture and equipment		6,801			6,945			7,454			6,991			6,733
Professional services		4,351			4,507			4,533			4,573			3,579
Project NOW expense		281			1,298			271			—			—
Advertising and business development		2,109			1,281			2,611			2,114			2,731
Telecommunications		1,551			1,526			1,613			1,628			1,476
Amortization of intangibles		1,286			1,291			1,417			1,474			1,589
Regulatory assessments		6,479			4,655			3,452			3,020			2,374
Loan collection and foreclosed asset expense		7,247			4,891			4,558			4,491			2,303
Loss on nonmortgage loans held for sale		9,461			1,838			283			—			—
(Gain) loss on OREO		12,873			124			(316	)		765			(3	)
Other		7,154			7,711			10,361			7,883			9,667
Operating noninterest expenses (noninterest expenses, excluding non-operating items)		112,763			89,617			92,068			89,661			84,670
Goodwill impairment		2,511			—			237,618			—			—
Employment contracts and severance		829			—			9,599			4,621			2,299
Impairment of long lived assets		17,376			—			—			—			—
FDIC special assessment		5,700			—			—			—			—
Branch acquisition and conversion costs		—			—			—			—			731
(Gain) loss on early extinguishment of debt		(2,991	)		(52	)		1,747			(125	)		(83	)
Loss on derivative collateral		—			—			1,061			—			—
Loss on repurchase of auction rate securities		—			676			—			—			—
Non-operating noninterest expenses		23,425			624			250,025			4,496			2,947
Total noninterest expenses	$	136,188		$	90,241		$	342,093		$	94,157		$	87,617

3

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in thousands) (unaudited)

	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Assets
Cash and due from banks	$	303,456		$	152,725		$	292,219		$	176,293		$	224,991
Interest-bearing bank balances		3			1			166			35			55,713
Federal funds sold and securities purchased to resell		—			—			—			—			50,000
Securities
Available for sale		1,803,458			2,106,281			2,107,194			1,995,681			1,987,232
Held to maturity		146,469			18,039			22,709			24,518			26,677
Total securities		1,949,927			2,124,320			2,129,903			2,020,199			2,013,909
Loans held for sale		40,290			29,726			30,963			37,575			21,871
Loans held for investment		9,306,009			9,986,681			10,192,072			10,299,640			10,475,731
Less: Allowance for loan losses		(285,290	)		(280,156	)		(247,086	)		(200,748	)		(191,727	)
Net loans held for investment		9,020,719			9,706,525			9,944,986			10,098,892			10,284,004
Premises and equipment, net		273,365			285,580			282,472			274,258			265,853
Accrued interest receivable		40,517			42,927			50,388			51,207			56,118
Goodwill		221,650			224,161			224,161			461,458			463,300
Other intangible assets, net		19,282			20,568			21,859			23,112			24,586
Other assets		719,022			698,714			625,209			552,149			516,525
	$	12,588,231		$	13,285,247		$	13,602,326		$	13,695,178		$	13,976,870
Liabilities and Shareholders’ Equity
Liabilities
Deposits
Noninterest-bearing	$	1,099,743		$	1,067,953		$	1,041,140		$	1,022,632		$	1,107,115
Interest-bearing customer deposits		6,233,137			6,316,548			6,455,810			6,412,343			6,388,904
Interest-bearing brokered deposits		2,055,772			1,842,577			1,908,767			2,573,833			2,390,350
Total deposits		9,388,652			9,227,078			9,405,717			10,008,808			9,886,369
Short-term borrowings		343,154			1,342,088			1,626,374			1,188,929			1,581,601
Long-term debt		1,126,435			931,977			707,769			773,109			772,957
Accrued interest payable		72,699			74,032			71,465			61,463			55,880
Other liabilities		148,038			157,889			170,470			129,255			120,861
Total liabilities		11,078,978			11,733,064			11,981,795			12,161,564			12,417,668
Shareholders’ equity
Mandatorily convertible preferred stock		190,026			190,026			238,700			249,000			250,000
Perpetual preferred stock		329,380			328,523			327,679			—			—
Common stock		160,248			84,781			74,644			73,006			72,796
Surplus		1,191,170			1,182,423			1,135,920			1,104,697			1,101,524
Retained earnings (deficit)		(403,296	)		(291,199	)		(199,540	)		120,578			152,567
Accumulated other comprehensive income (loss), net of income tax		41,115			57,018			42,558			(13,667	)		(17,685	)
Other, net		610			611			570			—			—
Total shareholders’ equity		1,509,253			1,552,183			1,620,531			1,533,614			1,559,202
	$	12,588,231		$	13,285,247		$	13,602,326		$	13,695,178		$	13,976,870

4

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
INVESTMENT SECURITIES PORTFOLIO ANALYSIS
(dollars in thousands) (unaudited)

	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Investment Securities Portfolio
Available for sale (at fair value):
U.S. Treasury	$	4,051		$	2,042		$	2,069		$	28,084		$	27,703
U.S. Government agencies		44,220			313,159			313,729			327,933			335,593
Agency mortgage-backed securities		1,449,961			1,489,583			1,468,639			1,312,116			1,276,145
Private label mortgage-backed securities		11,600			12,462			12,771			15,152			15,544
State and municipal		232,916			241,478			262,248			260,532			270,521
Other investments (1)		60,710			47,557			47,738			51,864			61,726
Total available for sale securities		1,803,458			2,106,281			2,107,194			1,995,681			1,987,232
Held to maturity (at amortized cost)		146,469			18,039			22,709			24,518			26,677
Total securities	$	1,949,927		$	2,124,320		$	2,129,903		$	2,020,199		$	2,013,909
Total securities as a percentage of total assets		15.5	%		16.0	%		15.7	%		14.8	%		14.4	%

	June 30, 2009
	Amortized Cost		Percentage of Total			Duration			Book Yield
Debt Securities
U.S. Treasury	$	4,080		0.2	%		1.9			3.62	%
U.S. Government agencies		43,418		2.5			2.4			2.78
Mortgage-backed securities:
Collateralized mortgage obligations		729,550		42.6			3.5			4.54
Adjustable rate mortgages		217,275		12.7			2.2			4.41
Pass-through		491,374		28.7			4.3			4.76
State and municipal		226,572		13.3			2.4			5.08
Total available for sale debt securities	$	1,712,269		100.0	%		3.4	(2)		4.61	%
Fixed interest rate:
Mortgage-backed securities	$	1,215,505		71.0	%		3.8			4.63	%
Other		274,070		16.0			2.4			4.69
Variable interest rate:
Mortgage-backed securities		222,694		13.0			2.2			4.41
Total available for sale debt securities	$	1,712,269		100.0	%		3.4	(2)		4.61	%

Projected Interest Rate Shock for Debt Securities

Interest Rate Scenario	Estimated Impact on Fair Value			Duration
Up 2.00%		(6.5	) %		5.0
Up 1.00%		(2.9	)		4.3
Flat		—			3.4

The estimated decrease in fair value for a five year U.S. Treasury Note when interest rates increase 100 basis points is 4.55%.
(1)	Other investments in available for sale securities include FHLB stock, community bank stocks, and other equity securities. Also, excludes certain other investments recorded in other assets totaling $20.7 million.
(2)	Compared to 1.9 years duration at March 31, 2009 due to overall higher interest rates.

5

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
INVESTMENT SECURITIES PORTFOLIO CREDIT RISK PROFILE
(dollars in thousands) (unaudited)

	June 30, 2009					December 31, 2008
	Balance		% of Total			Balance		% of Total
Government and agency
U.S. Treasury	$	4,051		0.2	%	$	2,069		0.1	%
U.S. Government agencies (1)		44,220		2.3			313,729		14.7
Agency mortgage-backed securities (MBS) (1)(2)		1,579,495		81.0			1,468,639		68.9
Federal Home Loan Bank Stock		58,825		3.0			35,536		1.7
Total government and agency		1,686,591		86.5			1,819,973		85.4
State and municipal (3)(4)(5)
Pre-funded with collateral or AAA-rated backed by Texas Permanent School Fund		172,767		8.9			188,598		8.9
Underlying issuer or collateral rated A or better (including South Carolina State Aid)		66,511		3.4			81,238		3.8
Underlying issuer or collateral rated BBB		3,881		0.2			7,344		0.3
Non-rated		6,592		0.3			7,677		0.4
Total state and municipal		249,751		12.8			284,857		13.4
Corporate bonds AA or A-rated		—		—			9,963		0.5
Private label mortgage-backed securities AAA-rated (2)		11,600		0.6			12,771		0.6
Community bank stocks and other		1,985		0.1			2,339		0.1
Total securities	$	1,949,927		100.0	%	$	2,129,903		100.0	%
Percent of total securities:
Rated A or higher				99.4	%				99.2	%
Investment grade				99.6	%				99.5	%

(1)	At June 30, 2009, these numbers include, in the aggregate, $29.1 million and $1.6 billion related to senior debt and MBS, respectively, issued by FNMA and FHLMC.
(2)	Current policies restrict MBS/CMO purchases to agency-backed and a small percent of private-label securities and prohibit securities collateralized by sub-prime assets.
(3)	At June 30, 2009, agency mortgage-backed securities include $129.5 million of securities held to maturity at amortized cost. At June 30, 2009 and December 31, 2008, state and municipal securities include $16.8 million and $22.6 million, respectively, of securities held to maturity at amortized cost.
(4)	Ratings shown above do not reflect the benefit of guarantees by bond insurers. At June 30, 2009, $38.3 million of municipal bonds are guaranteed by bond insurers. At December 31, 2008, $39.1 million of municipal bonds are guaranteed by bond insurers.
(5)	At June 30, 2009, the breakdown by current bond rating is as follows: $172.8 million pre-funded with collateral or AAA-rated backed Texas Permanent School Fund, $3.6 million AAA-rated, $68.1 million AA or A-rated, $2.4 million BBB-rated, and $2.9 million non-rated.
Note: Within each category, securities are ordered based on risk assessment from lowest to highest. TSFG holds no collateralized debt obligations.

6

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
LOAN PORTFOLIO COMPOSITION BASED ON LOAN PURPOSE AND LOAN GROWTH, CORE VS. NON-CORE
(dollars in thousands) (unaudited)

	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Commercial Loans
Commercial and industrial	$	2,428,511		$	2,645,871		$	2,722,611		$	2,824,117		$	2,891,007
Owner - occupied real estate		1,315,442			1,285,530			1,270,746			1,206,597			1,183,618
Commercial real estate		3,873,199			4,042,871			4,074,331			4,094,164			4,162,248
		7,617,152			7,974,272			8,067,688			8,124,878			8,236,873
Consumer Loans
Indirect - sales finance		285,658			573,653			635,637			680,413			728,433
Consumer lot loans		178,212			198,032			225,486			249,062			266,242
Direct retail		87,326			90,999			95,397			100,257			99,951
Home equity		811,057			813,015			813,201			784,357			781,120
		1,362,253			1,675,699			1,769,721			1,814,089			1,875,746
Mortgage Loans		326,604			336,710			354,663			360,673			363,112
Total loans held for investment	$	9,306,009		$	9,986,681		$	10,192,072		$	10,299,640		$	10,475,731
Percentage of Loans Held for Investment
Commercial and industrial		26.1	%		26.4	%		26.7	%		27.4	%		27.6	%
Owner - occupied real estate		14.2			12.9			12.5			11.7			11.3
Commercial real estate		41.6			40.5			40.0			39.8			39.7
Consumer		14.6			16.8			17.3			17.6			17.9
Mortgage		3.5			3.4			3.5			3.5			3.5
Total		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%
	For The Period Ended
	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Growth in Loans Held for Investment (1)
Growth vs. prior quarter, annualized		(27.3	)%		(8.2	)%		(4.2	)%		(6.7	)%		7.8	%
Growth year-to-date, annualized		(17.5	)		(8.2	)		(0.2	)		1.1			5.2

LOAN PORTFOLIO COMPOSITION – CORE AND NON-CORE LOANS
(BASED ON ABILITY TO BUILD/EXPAND BANKING RELATIONSHIP)

	6/30/09		3/31/09		12/31/08
Core Relationship Loans
Commercial	$	6,210,451	$	6,353,401	$	6,305,111
Consumer and mortgage		1,175,883		1,178,809		1,202,258
Total Core		7,386,334		7,532,210		7,507,369
Non-Core Loans
Commercial		1,406,701		1,620,871		1,762,577
Indirect - sales finance		276,179		569,124		635,637
Consumer lot loans		171,725		192,903		222,416
Other consumer and mortgage		65,070		71,573		64,073
Total Non-Core		1,919,675		2,454,471		2,684,703
Total loans held for investment	$	9,306,009	$	9,986,681	$	10,192,072

⁽¹⁾ At March 31, 2008 and December 31, 2007, loans held for investment totaled $10,275,653 and $10,213,420, respectively.

7

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
SUMMARY OF CREDIT QUALITY AND ALLOWANCE FOR CREDIT LOSSES
(dollars in thousands) (unaudited)

	At and for the Three Months Ended
	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Credit Quality
Loans held for investment	$	9,306,009		$	9,986,681		$	10,192,072		$	10,299,640		$	10,475,731
Allowance for loan losses		285,290			280,156			247,086			200,748			191,727
Allowance for credit losses		289,680			283,425			249,874			203,000			193,825
Nonperforming loans held for investment		464,565			422,950			349,382			237,812			218,726
Nonperforming loans held for sale		376			12,766			16,282			22,576			—
Foreclosed property (other real estate owned and personal property repossessions)		95,752			77,210			48,993			30,503			21,780
Nonperforming assets	$	560,693		$	512,926		$	414,657		$	290,891		$	240,506
Restructured loans not included in nonperforming assets	$	17,291		$	11,073		$	6,249		$	2,279		$	1,425
Nonperforming loans as a % of loans held for investment		4.99	%		4.24	%		3.43	%		2.31	%		2.09	%
Nonperforming assets as a % of loans and foreclosed property		5.94			5.08			4.04			2.81			2.29
Allowance for loan losses as a % of loans held for investment		3.07			2.81			2.42			1.95			1.83
Allowance for credit losses as a % of loans held for investment		3.11			2.84			2.45			1.97			1.85
Allowance for loan losses to nonperforming loans held for investment		0.61	x		0.66	x		0.71	x		0.84	x		0.88	x
Impaired loans	$	432,366		$	369,339		$	287,497		$	198,018		$	195,774
Specific allowance for impaired loans		70,006			66,988			44,418			29,911			39,238
Loans past due 90 days or more (interest accruing)		11,107			6,444			47,481			12,899			8,779
Net loan charge-offs		120,611			109,076			76,052			75,433			46,954
Average loans held for investment		9,847,366			10,154,853			10,308,823			10,441,580			10,435,248
Net loan charge-offs as a % of average loans held for investment (annualized)		4.91	%		4.36	%		2.93	%		2.87	%		1.81	%
Allowance for Loan Losses
Balance at beginning of period	$	280,156		$	247,086		$	200,748		$	191,727		$	174,420
Allowance adjustment for loans sold		(4,471	)		—			—			—			—
Provision for loan losses		130,216			142,146			122,390			84,454			64,261
Loans charged-off		(124,122	)		(110,443	)		(78,297	)		(76,558	)		(48,523	)
Recoveries of loans previously charged-off		3,511			1,367			2,245			1,125			1,569
Balance at end of period	$	285,290		$	280,156		$	247,086		$	200,748		$	191,727
Reserve for Unfunded Lending Commitments
Balance at beginning of period	$	3,269		$	2,788		$	2,252		$	2,098		$	2,596
Provision for unfunded lending commitments		1,121			481			536			154			(498	)
Balance at end of period	$	4,390		$	3,269		$	2,788		$	2,252		$	2,098
Allowance for Credit Losses
Balance at beginning of period	$	283,425		$	249,874		$	203,000		$	193,825		$	177,016
Allowance adjustment for loans sold		(4,471	)		—			—			—			—
Provision for credit losses		131,337			142,627			122,926			84,608			63,763
Loans charged-off		(124,122	)		(110,443	)		(78,297	)		(76,558	)		(48,523	)
Recoveries of loans previously charged-off		3,511			1,367			2,245			1,125			1,569
Balance at end of period	$	289,680		$	283,425		$	249,874		$	203,000		$	193,825

8

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
COMMERCIAL REAL ESTATE LOANS
(dollars in millions) (unaudited)

	6/30/09 Commercial Real Estate (“CRE”) Loans by Geography (1)
	SC, Excl Coastal			Coastal SC			Western NC			Central FL			North FL			South FL			Tampa Bay			Total CRE Loans			% of Loans HFI
CRE Loans by Product Type:
Completed income property	$	536		$	342		$	395		$	202		$	359		$	147		$	154		$	2,135			23	%
Residential A&D		95			62			153			32			64			16			41			463			5
Commercial A&D		43			22			34			35			6			14			33			187			2
Commercial construction		208			46			25			47			16			31			25			398			4
Residential construction		36			40			23			13			24			2			5			143			2
Residential condo		20			67			11			8			31			23			16			176			2
Undeveloped land		53			64			57			63			63			15			56			371			4
Total CRE Loans	$	991		$	643		$	698		$	400		$	563		$	248		$	330		$	3,873			42	%
% of Total Loans HFI		11	%		7	%		8	%		4	%		6	%		3	%		4	%		42	%
	6/30/09 CRE Nonaccrual Loans HFI (“NAL”) by Geography
	SC, Excl Coastal			Coastal SC			Western NC			Central FL			North FL			South FL			Tampa Bay			Total CRE NAL			% of NAL (1)
CRE Nonaccrual Loans by Product Type:
Completed income property	$	7.8		$	12.8		$	17.0		$	9.5		$	3.6		$	10.0		$	17.1		$	77.8			17	%
Residential A&D		20.2			9.4			13.5			4.3			3.0			2.0			5.7			58.1			12
Commercial A&D		0.1			0.7			1.0			—			—			—			19.9			21.7			5
Commercial construction		0.8			—			4.5			—			—			—			13.6			18.9			4
Residential construction		2.6			5.9			3.7			9.5			0.7			—			3.5			25.9			6
Residential condo		8.4			33.8			0.2			4.3			—			8.6			4.8			60.1			13
Undeveloped land		1.5			0.4			1.1			13.3			0.8			8.4			21.3			46.8			10
Total CRE Nonaccrual Loans	$	41.4		$	63.0		$	41.0		$	40.9		$	8.1		$	29.0		$	85.9		$	309.3			67	%
CRE Nonaccrual Loans as % of Total Nonaccrual Loans (1)		9	%		14	%		9	%		9	%		2	%		6	%		18	%		67	%
	Three Months Ended 6/30/09 CRE Net Charge-offs (“NCO”) by Geography
	SC, Excl Coastal			Coastal SC			Western NC			Central FL			North FL			South FL			Tampa Bay			Total CRE NCO			% of NCO
CRE Net Charge-offs by Product Type:
Completed income property	$	1.6		$	4.3		$	2.2		$	3.0		$	0.4		$	1.0		$	2.7		$	15.2			13	%
Residential A&D		2.4			1.8			2.0			0.8			0.9			1.6			6.1			15.6			13
Commercial A&D		—			0.5			0.2			0.1			—			—			13.4			14.2			12
Commercial construction		—			0.2			—			—			—			—			—			0.2			—
Residential construction		0.5			0.5			1.1			3.9			0.1			—			0.3			6.4			5
Residential condo		(0.5	)		4.9			—			—			—			—			4.1			8.5			7
Undeveloped land		—			—			0.6			4.2			1.2			4.6			11.4			22.0			18
Total CRE Net Charge-offs	$	4.0		$	12.2		$	6.1		$	12.0		$	2.6		$	7.2		$	38.0		$	82.1			68	%
CRE Net Charge-offs as % of Total Net Charge-offs		3	%		10	%		5	%		10	%		2	%		6	%		32	%		68	%

⁽¹⁾ Calculated as a percent of nonaccrual loans held for investment, which totaled $464.6 million at June 30, 2009. Excludes nonaccrual loans held for sale, which totaled $376,000 at June 30, 2009.

9

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
TYPES OF CUSTOMER FUNDING AND CUSTOMER FUNDING GROWTH
(dollars in thousands) (unaudited)

	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Noninterest-bearing	$	1,099,743		$	1,067,953		$	1,041,140		$	1,022,632		$	1,107,115
Interest-bearing checking		1,061,400			1,098,585			1,078,921			1,090,874			1,127,497
Money market accounts		1,978,114			1,889,041			1,834,115			1,806,143			2,162,599
Savings accounts		222,044			203,106			190,519			150,150			150,696
Core deposits		4,361,301			4,258,685			4,144,695			4,069,799			4,547,907
Time deposits under $100,000		1,710,870			1,742,177			1,863,520			1,840,363			1,468,372
Time deposits of $100,000 or more		1,260,709			1,383,639			1,488,735			1,524,813			1,479,740
Customer deposits (1)		7,332,880			7,384,501			7,496,950			7,434,975			7,496,019
Brokered deposits		2,055,772			1,842,577			1,908,767			2,573,833			2,390,350
Total deposits		9,388,652			9,227,078			9,405,717			10,008,808			9,886,369
Less: Brokered deposits		(2,055,772	)		(1,842,577	)		(1,908,767	)		(2,573,833	)		(2,390,350	)
Add: Customer sweep accounts		330,765			387,106			493,012			551,559			536,642
Customer funding (2)	$	7,663,645		$	7,771,607		$	7,989,962		$	7,986,534		$	8,032,661
Percentage of Deposits
Noninterest-bearing		11.7	%		11.6	%		11.1	%		10.2	%		11.2	%
Interest-bearing checking		11.3			11.9			11.5			10.9			11.4
Money market accounts		21.1			20.4			19.5			18.1			21.9
Savings accounts		2.4			2.2			2.0			1.5			1.5
Core deposits		46.5			46.1			44.1			40.7			46.0
Time deposits under $100,000		18.2			18.9			19.8			18.4			14.8
Time deposits of $100,000 or more		13.4			15.0			15.8			15.2			15.0
Customer deposits (1)		78.1			80.0			79.7			74.3			75.8
Brokered deposits		21.9			20.0			20.3			25.7			24.2
Total deposits		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%
	For The Period Ended
	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Growth vs. Prior Quarter, Annualized (3)
Noninterest-bearing		11.9	%		10.4	%		7.2	%		(30.4	)%		(0.5	)%
Total deposits		7.0			(7.7	)		(24.0	)		4.9			18.5
Customer funding (2)		(5.6	)		(11.1	)		0.2			(2.3	)		(8.5	)
Growth Year-To-Date, Annualized (4)
Noninterest-bearing		11.4	%		10.4	%		(7.7	)%		(12.4	)%		(3.7	)%
Total deposits		(0.4	)		(7.7	)		(3.9	)		3.0			2.0
Customer funding (2)		(8.2	)		(11.1	)		(2.3	)		(3.1	)		(3.6	)

(1)	Total deposits less brokered deposits.
(2)	Total deposits less brokered deposits plus customer sweep accounts.
(3)	At March 31, 2008, noninterest-bearing totaled $1,108,623, total deposits totaled $9,451,532, and customer funding totaled $8,206,777.
(4)	At December 31, 2007, noninterest-bearing totaled $1,127,657, total deposits totaled $9,788,568, and customer funding totaled $8,178,471.

10

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
WHOLESALE BORROWINGS
(dollars in thousands) (unaudited)

	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Types of wholesale borrowings
Short-term borrowings
Federal funds purchased and repurchase agreements	$	25		$	197,309		$	67,309		$	137,927		$	169,074
Customer sweep accounts		330,765			387,106			493,012			551,559			536,642
Federal Reserve borrowings		—			750,000			1,050,000			30,000			500,000
Commercial paper		—			—			12,537			19,068			25,155
Treasury, tax and loan note		12,364			7,673			3,516			450,375			350,730
Total short-term borrowings		343,154			1,342,088			1,626,374			1,188,929			1,581,601
Long-term borrowings
Repurchase agreements		125,000			200,000			200,000			200,000			200,000
FHLB advances		762,188			467,717			233,497			298,119			297,873
Subordinated notes		206,704			206,704			216,704			216,704			216,704
Mandatorily redeemable preferred stock of subsidiary		31,800			56,800			56,800			56,800			56,800
Note payable		743			756			768			779			791
Purchase accounting premiums, net of amortization		—			—			—			707			789
Total long-term borrowings		1,126,435			931,977			707,769			773,109			772,957
Total borrowings		1,469,589			2,274,065			2,334,143			1,962,038			2,354,558
Less: Customer sweep accounts		(330,765	)		(387,106	)		(493,012	)		(551,559	)		(536,642	)
Add: Brokered deposits		2,055,772			1,842,577			1,908,767			2,573,833			2,390,350
Total wholesale borrowings	$	3,194,596		$	3,729,536		$	3,749,898		$	3,984,312		$	4,208,266
Wholesale borrowings as a percentage of total assets		25.4	%		28.1	%		27.6	%		29.1	%		30.1	%

11

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
SUMMARY OF CAPITAL, CAPITAL RATIOS, UNREALIZED GAINS (LOSSES) ON
AVAILABLE FOR SALE SECURITIES, AND MARKET RATES FOR U.S. TREASURY NOTES
(dollars in thousands, except per share data) (unaudited)

	6/30/09			3/31/09			12/31/08			9/30/08			6/30/08
Regulatory Capital
Tier 1 capital	$	1,308,678		$	1,395,469		$	1,513,452		$	1,295,008		$	1,311,908
Tier 2 capital		136,453			164,973			174,625			173,820			177,271
Total risk-based capital		1,445,131			1,560,442			1,688,077			1,468,828			1,489,179
Total risk-weighted assets		10,584,755			11,532,895			11,764,518			11,584,136			11,872,790
Tangible Equity
Mandatorily convertible preferred stock	$	190,026		$	190,026		$	238,700		$	249,000		$	250,000
Perpetual preferred stock		329,380			328,523			327,679			—			—
Common equity		989,847			1,033,634			1,054,152			1,284,614			1,309,202
Shareholders’ equity		1,509,253			1,552,183			1,620,531			1,533,614			1,559,202
Intangible assets		(240,932	)		(244,729	)		(246,020	)		(484,570	)		(487,886	)
Tangible equity		1,268,321			1,307,454			1,374,511			1,049,044			1,071,316
Capital Ratios
Tier 1 risk-based capital (preliminary)		12.36	%		12.10	%		12.86	%		11.18	%		11.05	%
Total risk-based capital (preliminary)		13.65			13.53			14.35			12.68			12.54
Leverage ratio (preliminary)		10.30			10.55			11.22			9.70			9.81
Tangible equity to tangible assets ratio		10.27			10.03			10.29			7.94			7.94
Impact of unrealized (gain) loss on securities		(0.14	)		(0.19	)		(0.05	)		0.21			0.24
Tangible equity to tangible assets ratio, excluding unrealized gain or loss		10.13			9.84			10.24			8.15			8.18
Tangible common equity to tangible assets ratio		6.07			6.05			6.05			6.06			6.09
-Assuming conversion of mandatorily convertible preferred (1)		7.60			7.51			7.84			7.94			7.94
Unrealized Gains (Losses) on AFS Securities
Gross (included in AFS securities)	$	30,189		$	43,255		$	10,949		$	(48,147	)	$	(54,391	)
Net of income tax (included in equity)		19,013			27,233			6,890			(30,334	)		(34,287	)
Per Share Data
Mandatorily convertible preferred shares outstanding:
- Series 2008		95,526			190,026			238,700			249,000			250,000
- Series 2009		94,500			—			—			—			—
Total		190,026			190,026			238,700			249,000			250,000
Common shares outstanding		160,248,170			84,781,160			74,643,649			73,005,766			72,795,797
Conversion of preferred stock into common (1)		38,684,733			29,234,769			36,723,077			38,307,692			38,461,538
Common shares outstanding, assuming conversion		198,932,903			114,015,929			111,366,726			111,313,458			111,257,335
Common book value per common share	$	6.18		$	12.19		$	14.12		$	17.60		$	17.98
Common tangible book value per common share		4.67			9.31			10.83			10.96			11.28
Book value per common share, assuming conversion (1)		7.59			13.61			14.55			13.78			14.01
Market Rates for U.S. Treasury Notes
Three year		1.64	%		1.15	%		1.00	%		2.28	%		2.91	%
Five year		2.54			1.67			1.55			2.98			3.34

⁽¹⁾ Using a $6.50 conversion price for Series 2008 and a $3.9394 conversion price for Series 2009.

12

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
COMPARATIVE AVERAGE BALANCES - YIELDS AND COSTS
(dollars in thousands) (unaudited)

	Three Months Ended
	6/30/09						3/31/09						12/31/08
	Average Balance		Income/ Expense		Yield/ Rate		Average Balance		Income/ Expense		Yield/ Rate		Average Balance		Income/ Expense		Yield/ Rate
Assets
Earning assets
Commercial loans	$	7,900,570	$	83,970	4.26	%	$	8,086,559	$	83,794	4.20	%	$	8,172,311	$	106,243	5.17	%
Consumer loans		1,443,823		17,282	4.80			1,494,261		17,566	4.77			1,514,602		19,941	5.24
Indirect loans		530,875		9,544	7.21			607,548		10,845	7.24			657,329		11,862	7.18
Risk management derivatives tied to loans		—		11,027				—		11,914				—		7,243
Total loans (1)		9,875,268		121,823	4.95			10,188,368		124,119	4.94			10,344,242		145,289	5.59
Investment securities (taxable) (2)		1,680,893		18,140	4.32			1,854,149		20,548	4.43			1,835,248		20,575	4.48
Investment securities (nontaxable) (3)		246,001		3,188	5.18			266,600		3,437	5.16			281,839		3,616	5.13
Total investment securities		1,926,894		21,328	4.43			2,120,749		23,985	4.52			2,117,087		24,191	4.57
Federal funds sold, interest-bearing bank balances, and other temp investments		255		—	—			198		1	2.05			1,128		10	3.53
Total earning assets		11,802,417		143,151	4.86			12,309,315		148,105	4.87			12,462,457		169,490	5.41
Non-earning assets		1,283,139						1,246,813						1,322,477
Total assets	$	13,085,556					$	13,556,128					$	13,784,934
Liabilities and Shareholders’ Equity
Liabilities
Interest-bearing liabilities
Interest-bearing deposits
Interest checking	$	1,036,339	$	724	0.28		$	1,131,456	$	865	0.31		$	1,010,878	$	1,310	0.52
Savings		208,856		472	0.91			196,974		529	1.09			173,927		518	1.18
Money market		1,924,037		6,726	1.40			1,913,927		7,779	1.65			1,814,901		9,808	2.15
Time deposits, excluding brokered deposits		3,067,471		26,581	3.48			3,199,427		28,867	3.66			3,401,800		32,130	3.76
Brokered deposits		1,954,201		15,038	3.09			1,905,805		16,803	3.58			2,227,055		21,880	3.91
Total interest-bearing deposits		8,190,904		49,541	2.43			8,347,589		54,843	2.66			8,628,561		65,646	3.03
Customer sweep accounts		362,342		245	0.27			455,781		298	0.27			529,344		1,174	0.88
Other borrowings (4)		1,682,118		6,319	1.51			1,899,771		6,743	1.44			1,805,655		9,772	2.15
Total interest-bearing liabilities		10,235,364		56,105	2.20			10,703,141		61,884	2.34			10,963,560		76,592	2.78
Noninterest-bearing liabilities
Noninterest-bearing deposits		1,074,739						1,021,400						1,001,516
Other noninterest liabilities		235,432						230,741						201,107
Total liabilities		11,545,535						11,955,282						12,166,183
Shareholders’ equity		1,540,021						1,600,846						1,618,751
Total liabilities and shareholders’ equity	$	13,085,556					$	13,556,128					$	13,784,934
Net interest margin (tax-equivalent)			$	87,046	2.96	%			$	86,221	2.83	%			$	92,898	2.97	%
Less: tax-equivalent adjustment (3)				1,116						1,203						1,265
Net interest income			$	85,930					$	85,018					$	91,633
Supplemental data:
Customer funding (5)	$	7,673,784	$	34,748	1.82	%	$	7,918,965	$	38,338	1.96	%	$	7,932,366	$	44,940	2.25	%
Wholesale borrowings (6)		3,636,319		21,357	2.36			3,805,576		23,546	2.51			4,032,710		31,652	3.12
Total funding (7)	$	11,310,103	$	56,105	1.99	%	$	11,724,541	$	61,884	2.14	%	$	11,965,076	$	76,592	2.55	%

(1)	Nonaccrual loans are included in average balances for yield computations.
(2)	The average balances for investment securities exclude the unrealized gain or loss recorded for available for sale securities.
(3)	The tax-equivalent adjustment to net interest income adjusts the yield for assets earning tax-exempt income to a comparable yield on a taxable basis.
(4)	During the three months ended June 30, 2009, March 31, 2009, and December 31, 2008, TSFG capitalized $288,000, $450,000, and $478,000, respectively, of interest in conjunction with the construction of its expanded corporate facilities.
(5)	Customer funding includes total deposits less brokered deposits plus customer sweep accounts.
(6)	TSFG defines wholesale borrowings as borrowings less customer sweep accounts plus brokered deposits. For purposes of this table, wholesale borrowings equal the sum of other borrowings and brokered deposits, as customer sweep accounts are presented separately.
(7)	Total funding includes customer funding and wholesale borrowings.
Note: Average balances are derived from daily balances.

13

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
COMPARATIVE AVERAGE BALANCES - YIELDS AND COSTS - CONTINUED
(dollars in thousands) (unaudited)

	Three Months Ended
	9/30/08							6/30/08
	Average Balance		Income/ Expense		Yield/ Rate			Average Balance		Income/ Expense		Yield/ Rate
Assets
Earning assets
Commercial loans	$	8,233,343	$	113,281		5.47	%	$	8,193,599	$	114,935		5.64	%
Consumer loans		1,518,642		22,577		5.91			1,530,817		23,272		6.11
Indirect loans		706,780		12,621		7.10			734,155		13,152		7.21
Risk management derivatives tied to loans		—		6,954					—		6,657
Total loans (1)		10,458,765		155,433		5.91			10,458,571		158,016		6.08
Investment securities (taxable) (2)		1,768,461		20,186		4.57			1,799,907		20,591		4.58
Investment securities (nontaxable) (3)		290,431		3,726		5.13			299,350		3,814		5.10
Total investment securities		2,058,892		23,912		4.65			2,099,257		24,405		4.65
Federal funds sold, interest-bearing bank balances, and other temp investments		37,149		197		2.11			20,256		106		2.10
Total earning assets		12,554,806		179,542		5.69			12,578,084		182,527		5.83
Non-earning assets		1,281,130							1,290,065
Total assets	$	13,835,936						$	13,868,149
Liabilities and Shareholders’ Equity
Liabilities
Interest-bearing liabilities
Interest-bearing deposits
Interest checking	$	1,130,079	$	2,481		0.87		$	1,120,716	$	2,683		0.96
Savings		143,014		255		0.71			152,023		304		0.80
Money market		1,949,001		11,293		2.31			2,104,322		11,822		2.26
Time deposits, excluding brokered deposits		3,259,783		30,522		3.72			2,997,131		29,172		3.91
Brokered deposits		2,574,430		24,520		3.79			2,081,224		19,199		3.71
Total interest-bearing deposits		9,056,307		69,071		3.03			8,455,416		63,180		3.01
Customer sweep accounts		536,526		2,251		1.67			573,957		2,621		1.84
Other borrowings (4)		1,453,196		11,297		3.09			2,078,730		15,186		2.94
Total interest-bearing liabilities		11,046,029		82,619		2.98			11,108,103		80,987		2.93
Noninterest-bearing liabilities
Noninterest-bearing deposits		1,059,565							1,079,390
Other noninterest liabilities		177,735							185,275
Total liabilities		12,283,329							12,372,768
Shareholders’ equity		1,552,607							1,495,381
Total liabilities and shareholders’ equity	$	13,835,936						$	13,868,149
Net interest margin (tax-equivalent)			$	96,923		3.08	%			$	101,540		3.24	%
Less: tax-equivalent adjustment (3)				1,304							1,335
Net interest income			$	95,619						$	100,205
Supplemental data:
Customer funding (5)	$	8,077,968	$	46,802		2.30	%	$	8,027,539	$	46,602		2.33	%
Wholesale borrowings (6)		4,027,626		35,817		3.54			4,159,954		34,385		3.32
Total funding (7)	$	12,105,594	$	82,619		2.72	%	$	12,187,493	$	80,987		2.67	%

(1)	Nonaccrual loans are included in average balances for yield computations.
(2)	The average balances for investment securities exclude the unrealized gain or loss recorded for available for sale securities.
(3)	The tax-equivalent adjustment to net interest income adjusts the yield for assets earning tax-exempt income to a comparable yield on a taxable basis.
(4)	During the three months ended September 30, 2008 and June 30, 2008, TSFG capitalized $424,000 and $332,000, respectively, of interest in conjunction with the construction of its expanded corporate facilities.
(5)	Customer funding includes total deposits less brokered deposits plus customer sweep accounts.
(6)	TSFG defines wholesale borrowings as borrowings less customer sweep accounts plus brokered deposits. For purposes of this table, wholesale borrowings equal the sum of other borrowings and brokered deposits, as customer sweep accounts are presented separately.
(7)	Total funding includes customer funding and wholesale borrowings

Note: Average balances are derived from daily balances.

14

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands, except share data) (unaudited)

	Three Months Ended
	6/30/09						3/31/09
				Diluted EPS						Diluted EPS
Net Loss, as Reported (GAAP)	$	(89,676	)				$	(74,403	)
Preferred stock dividends and other (1)		(21,809	)					(16,408	)
Net Loss Available to Common Shareholders	$	(111,485	)	$	(1.23	)	$	(90,811	)	$	(1.10	)
Net Loss, as Reported (GAAP)		(89,676	)					(74,403	)
Add: Income tax expense (benefit)		(59,647	)					(49,706	)
Loss Before Income Taxes		(149,323	)					(124,109	)
Non-Operating Items
(Gain) loss on securities		(4,580	)					2,954
Goodwill impairment		2,511						—
Employment contracts and severance		829						—
Impairment of long lived assets		17,376						—
FDIC special assessment		5,700						—
Gain on early extinguishment of debt		(2,991	)					(52	)
Loss on repurchase of auction rate securities		—						676
Pre-tax Operating Loss (loss before taxes, excluding non-operating items)		(130,478	)					(120,531	)
Related income taxes		(50,402	)					(48,364	)
Operating Loss (net loss, excluding non-operating items)		(80,076	)					(72,167	)
Preferred stock dividends and other (1)		(21,809	)					(16,408	)
Operating Loss Available to Common Shareholders (net loss available to common shareholders, excluding non-operating items)	$	(101,885	)	$	(1.12	)	$	(88,575	)	$	(1.08	)
Average Common Shares Outstanding, Diluted		90,986,862						82,223,190
Select Balance Sheet (Averages)
Total assets	$	13,085,556					$	13,556,128
Intangible assets		(244,040	)					(245,341	)
Tangible assets		12,841,516						13,310,787
Preferred stock		518,968						532,430
Common equity		1,021,053						1,068,416
Shareholders’ equity		1,540,021						1,600,846
Intangible assets		(244,040	)					(245,341	)
Tangible equity		1,295,981						1,355,505
Return on Average Assets (2)
GAAP loss		(2.75	)%					(2.23	)%
Return on Average Equity (2)
GAAP loss		(23.36	)					(18.85	)
Return on Average Common Equity (3)
GAAP loss available to common shareholders		(43.79	)					(34.47	)

(1)	For the quarters ended June 30, 2009 and March 31, 2009, includes $14.0 million and $6.5 million, respectively, for the value of common shares recorded as an inducement for early conversion of mandatorily convertible preferred stock.
(2)	Return on average assets and return on average equity are calculated as net income divided by average assets or average total equity.
(3)	Return on average common equity is calculated as net income available to common shareholders divided by average common equity.

15

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands, except share data) (unaudited)

	Three Months Ended
	12/31/08						9/30/08						6/30/08						3/31/08
				Diluted EPS						Diluted EPS						Diluted EPS						Diluted EPS
Net Loss, as Reported (GAAP)	$	(309,939	)				$	(24,955	)				$	(10,932	)				$	(201,292	)
Preferred stock dividends and other		(9,424	)					(6,257	)					(5,840	)					(137	)
Net Loss Available to Common Shareholders	$	(319,363	)	$	(4.29	)	$	(31,212	)	$	(0.43	)	$	(16,772	)	$	(0.23	)	$	(201,429	)	$	(2.78	)
Net Loss, as Reported (GAAP)	$	(309,939	)				$	(24,955	)				$	(10,932	)				$	(201,292	)
Add: Income tax expense (benefit)		(33,435	)					(29,526	)					(8,056	)					(16,557	)
Loss Before Income Taxes		(343,374	)					(54,481	)					(18,988	)					(217,849	)
Non-Operating Items
(Gain) loss on securities		(1,561	)					725						(1,876	)					(396	)
Gain on Visa IPO share redemption		—						—						—						(1,904	)
Goodwill impairment		237,618						—						—						188,431
Employment contracts and severance		9,599						4,621						2,299						—
Branch acquisition and conversion costs		—						—						731						—
(Gain) loss on early extinguishment of debt		1,747						(125	)					(83	)					547
Visa-related litigation		—						—						—						(863	)
Loss on derivative collateral		1,061						—						—						—
Pre-tax Operating Loss (loss before taxes, excluding non-operating items)		(94,910	)					(49,260	)					(17,917	)					(32,034	)
Related income taxes		(29,368	)					(26,696	)					(7,655	)					(17,538	)
Operating Loss (net loss, excluding non-operating items)		(65,542	)					(22,564	)					(10,262	)					(14,496	)
Preferred stock dividends and other		(9,424	)					(6,257	)					(5,840	)					(137	)
Operating Loss Available to Common Shareholders (net loss available to common shareholders, excluding non-operating items)	$	(74,966	)	$	(1.01	)	$	(28,821	)	$	(0.40	)	$	(16,102	)	$	(0.22	)	$	(14,633	)	$	(0.20	)
Average Common Shares Outstanding, Diluted		74,505,656						72,755,480						72,611,024						72,449,437
Select Balance Sheet (Averages)
Total assets	$	13,784,934					$	13,835,936					$	13,868,149					$	13,844,905
Intangible assets		(481,380	)					(487,061	)					(487,440	)					(675,250	)
Tangible assets		13,303,554						13,348,875						13,380,709						13,169,655
Preferred stock		337,439						249,717						137,783						—
Common equity		1,281,312						1,302,890						1,357,598						1,564,978
Shareholders’ equity		1,618,751						1,552,607						1,495,381						1,564,978
Intangible assets		(481,380	)					(487,061	)					(487,440	)					(675,250	)
Tangible equity		1,137,371						1,065,546						1,007,941						889,728
Return on Average Assets (1)
GAAP loss		(8.94	)%					(0.72	)%					(0.32	)%					(5.85	)%
Return on Average Equity (1)
GAAP loss		(76.17	)					(6.39	)					(2.94	)					(51.73	)
Return on Average Common Equity (2)
GAAP loss available to common shareholders		(99.16	)					(9.53	)					(4.97	)					(51.73	)

(1)	Return on average assets and return on average equity are calculated as net income divided by average assets or average total equity.
(2)	Return on average common equity is calculated as net income available to common shareholders divided by average common equity.

16

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands, except share data) (unaudited)

	Years Ended December 31,
	2008						2007
				Diluted EPS						Diluted EPS
Net Income (Loss), as Reported (GAAP)	$	(547,118	)				$	73,276
Preferred stock dividends and other		(21,658	)					(665	)
Net Income (Loss) Available to Common Shareholders	$	(568,776	)	$	(7.78	)	$	72,611		$	0.98
Net Income (Loss), as Reported (GAAP)	$	(547,118	)				$	73,276
Add: Income tax expense (benefit)		(87,574	)					33,400
Income (Loss) Before Income Taxes		(634,692	)					106,676
Non-Operating Items
(Gain) loss on securities		(3,108	)					4,623
Gain on Visa IPO share redemption		(1,904	)					—
Goodwill impairment		426,049						—
Employment contracts and severance		16,519						2,306
Branch acquisition and conversion costs		731						—
Loss on early extinguishment of debt		2,086						2,029
Visa-related litigation		(863	)					881
Loss on derivative collateral		1,061						—
Pre-tax Operating Income (Loss) (income (loss) before taxes, excluding non-operating items)		(194,121	)					116,515
Related income taxes		(81,257	)					36,587
Operating Income (Loss) (net income (loss), excluding non-operating items)		(112,864	)					79,928
Preferred stock dividends and other		(21,658	)					(665	)
Operating Income (Loss) Available to Common Shareholders (net income (loss) available to common shareholders, excluding non-operating items)	$	(134,522	)	$	(1.84	)	$	79,263		$	1.07
Average Common Shares Outstanding, Diluted		73,136,936						74,006,978
Select Balance Sheet (Averages)
Total assets	$	13,833,355					$	14,044,565
Intangible assets		(532,517	)					(681,628	)
Tangible assets		13,300,838						13,362,937
Preferred stock		181,849						—
Common equity		1,376,232						1,543,552
Shareholders’ equity		1,558,081						1,543,552
Intangible assets		(532,517	)					(681,628	)
Tangible equity		1,025,564						861,924
Return on Average Assets (1)
GAAP earnings (loss)		(3.96	)%					0.52	%
Return on Average Equity (1)
GAAP earnings (loss)		(35.11	)					4.75
Return on Average Common Equity (2)
GAAP earnings (loss) available to common shareholders		(41.33	)					4.70

(1)	Return on average assets and return on average equity are calculated as net income divided by average assets or average total equity.
(2)	Return on average common equity is calculated as net income available to common shareholders divided by average common equity.

17

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands) (unaudited)

	Three Months Ended
	6/30/09			3/31/09
Select Financial Data Used in Ratios Calculated Below
Net interest income	$	85,930		$	85,018
Tax-equivalent adjustment		1,116			1,203
Net interest income (tax-equivalent)	$	87,046		$	86,221
Total noninterest income, as reported (GAAP)	$	32,272		$	23,741
Adjustments for non-operating items:
(Gain) loss on securities		(4,580	)		2,954
Operating noninterest income (noninterest income, excluding non-operating items)	$	27,692		$	26,695
Total noninterest expenses, as reported (GAAP)	$	136,188		$	90,241
Adjustments for non-operating items:
Goodwill impairment		(2,511	)		—
Employment contracts and severance		(829	)		—
Impairment of long lived assets		(17,376	)		—
FDIC special assessment		(5,700	)		—
Gain on early extinguishment of debt		2,991			52
Loss on repurchase of auction rate securities		—			(676	)
Operating noninterest expenses (noninterest expenses, excluding non-operating items)		112,763			89,617
Less: gain (loss) on OREO		(12,873	)		(124	)
Less: loss on nonmortgage loans held for sale		(9,461	)		(1,838	)
Less: amortization of intangibles		(1,286	)		(1,291	)
Cash operating noninterest expenses (noninterest expenses, excluding non-operating items, gain/loss on OREO, loss on nonmortgage loans held for sale, and amortization of intangibles)	$	89,143		$	86,364
Total Revenue (1)
GAAP	$	118,202		$	108,759
Operating (2)		114,738			112,916
Noninterest Income as a % Total Revenue (3)
GAAP		27.30			21.83	%
Operating (2)		24.13			23.64
Cash Operating Efficiency Ratio (4)		77.69			76.49

(1)	The sum of net interest income and noninterest income.
(2)	Total revenue and noninterest income as a% of total revenue, on an operating basis, are calculated using tax-equivalent net interest income and exclude non-operating items.
(3)	Calculated as noninterest income, divided by the sum of net interest income and noninterest income.
(4)	Calculated as operating noninterest expenses before gain/loss on OREO, loss on nonmortgage loans held for sale, and amortization of intangibles, divided by the sum of tax-equivalent net interest income and operating noninterest income.

18

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands) (unaudited)

	Three Months Ended
	12/31/08			9/30/08			6/30/08			3/31/08
Select Financial Data Used in Ratios Calculated Below
Net interest income	$	91,633		$	95,619		$	100,205		$	92,706
Tax-equivalent adjustment		1,265			1,304			1,335			1,450
Net interest income (tax-equivalent)	$	92,898		$	96,923		$	101,540		$	94,156
Total noninterest income, as reported (GAAP)	$	30,012		$	28,665		$	32,187		$	31,103
Adjustments for non-operating items:
(Gain) loss on securities		(1,561	)		725			(1,876	)		(396	)
Gain on Visa IPO share redemption		—			—			—			(1,904	)
Operating noninterest income (noninterest income, excluding non-operating items)	$	28,451		$	29,390		$	30,311		$	28,803
Total noninterest expenses, as reported (GAAP)	$	342,093		$	94,157		$	87,617		$	268,366
Adjustments for non-operating items:
Goodwill impairment		(237,618	)		—			—			(188,431	)
Employment contracts and severance		(9,599	)		(4,621	)		(2,299	)		—
Branch acquisition and conversion costs		—			—			(731	)		—
Gain (loss) on early extinguishment of debt		(1,747	)		125			83			(547	)
Visa-related litigation		—			—			—			863
Loss on derivative collateral		(1,061	)		—			—			—
Operating noninterest expenses (noninterest expenses, excluding non-operating items)		92,068			89,661			84,670			80,251
Less: gain (loss) on OREO		316			(765	)		3			(187	)
Less: loss on nonmortgage loans held for sale		(283	)		—			—			—
Less: amortization of intangibles		(1,417	)		(1,474	)		(1,589	)		(1,658	)
Cash operating noninterest expenses (noninterest expenses, excluding non-operating items, gain/loss on OREO, loss on nonmortgage loans held for sale, and amortization of intangibles)	$	90,684		$	87,422		$	83,084		$	78,406
Total Revenue (1)
GAAP	$	121,645		$	124,284		$	132,392		$	123,809
Operating (2)		121,349			126,313			131,851			122,959
Noninterest Income as a % Total Revenue (3)
GAAP		24.67	%		23.06	%		24.31	%		25.12	%
Operating (2)		23.45			23.27			22.99			23.42
Cash Operating Efficiency Ratio(4)		74.73			69.21			63.01			63.77

(1)	The sum of net interest income and noninterest income.
(2)	Total revenue and noninterest income as a % of total revenue, on an operating basis, are calculated using tax-equivalent net interest income and exclude non-operating items.
(3)	Calculated as noninterest income, divided by the sum of net interest income and noninterest income.
(4)	Calculated as operating noninterest expenses before gain/loss on OREO, loss on nonmortgage loans held for sale, and amortization of intangibles, divided by the sum of tax-equivalent net interest income and operating noninterest income.

19

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands) (unaudited)

	Years Ended December 31,
	2008			2007
Select Financial Data Used in Ratios Calculated Below
Net interest income	$	380,163		$	382,781
Tax-equivalent adjustment		5,354			6,246
Net interest income (tax-equivalent)	$	385,517		$	389,027
Net interest margin (tax-equivalent)		3.09	%		3.10	%
Total noninterest income, as reported (GAAP)	$	121,967		$	113,712
Adjustments for non-operating items:
(Gain) loss on securities		(3,108	)		4,623
Gain on Visa IPO share redemption		(1,904	)		—
Operating noninterest income (noninterest income, excluding non-operating items)	$	116,955		$	118,335
Total noninterest expenses, as reported (GAAP)	$	792,233		$	321,249
Adjustments for non-operating items:
Goodwill impairment		(426,049	)		—
Employment contracts and severance		(16,519	)		(2,306	)
Branch acquisition and conversion costs		(731	)		—
Loss on early extinguishment of debt		(2,086	)		(2,029	)
Visa-related litigation		863			(881	)
Loss on derivative collateral		(1,061	)		—
Operating noninterest expenses (noninterest expenses, excluding non-operating items)		346,650			316,033
Less: gain (loss) on OREO		(633	)		(401	)
Less: loss on nonmortgage loans held for sale		(283	)		—
Less: amortization of intangibles		(6,138	)		(7,897	)
Cash operating noninterest expenses (noninterest expenses, excluding non-operating items, gain/loss on OREO, loss on nonmortgage loans held for sale, and amortization of intangibles)	$	339,596		$	307,735
Total Revenue (1)
GAAP	$	502,130		$	496,493
Operating (2)		502,472			507,362
Noninterest Income as a % of Total Revenue (3)
GAAP		24.29	%		22.90	%
Operating (2)		23.28			23.32
Cash Operating Efficiency Ratio (4)		67.59			60.65

(1)	The sum of net interest income and noninterest income.
(2)	Total revenue and noninterest income as a % of total revenue, on an operating basis, are calculated using tax-equivalent net interest income and exclude non-operating items.
(3)	Calculated as noninterest income, divided by the sum of net interest income and noninterest income.
(4)	Calculated as operating noninterest expenses before gain/loss on OREO, loss on nonmortgage loans held for sale, and amortization of intangibles, divided by the sum of tax-equivalent net interest income and operating noninterest income.

20

EX-99

Second Quarter 2009
Financial Review
July 22, 2009

Forward-Looking Statements
and Non-GAAP Financial Information

We caution you that this presentation contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including certain plans, expectations, goals, projections, and
statements, which are subject to numerous assumptions, risks, and uncertainties.  The use of words such as "anticipates", "estimates", "expects",
“illustrates”, "intends", "plans", and "believes", among others, generally identify forward-looking statements.  However, these words are not the
exclusive means of identifying such statements.  Forward-looking statements can be identified by the fact that they do not relate strictly to historical
or current facts.

Actual results could differ materially from those contained or implied by such statements for a variety of factors including: loan deterioration could be
worse than expected due to a number of factors such as the underlying value of the collateral could prove less valuable than otherwise assumed and
assumed cash flows may be worse than expected; changes in economic conditions; movements in interest rates; competitive pressures on product
pricing and services; success and timing of other business strategies; the nature, extent, and timing of governmental actions and reforms, including
existing and potential future restrictions and limitations imposed in connection with the Troubled Asset Relief Program’s voluntary Capital Purchase
Plan or otherwise under the Emergency Economic Stabilization Act of 2008; and the relative success of anticipated capital actions.

Additional factors that could cause results to differ materially from those described above can be found in TSFG’s 2008 Annual Report on Form 10-K,
including in the discussion under "Risk Factors", and documents subsequently filed by TSFG with the Securities and Exchange Commission.

Reference is made to TSFG’s reports filed with the Securities and Exchange Commission for a discussion of factors that may cause such differences to
occur. TSFG undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after today’s
presentation.

This presentation contains certain non-GAAP measures, such as results excluding the impact of certain nonoperating items. TSFG management uses
these non-GAAP, or operating measures, in its analysis of TSFG’s performance. TSFG believes presentations of financial measures excluding the impact
of certain items provide useful supplemental information and better reflect its core operating activities. Management uses operating measures, in
particular, to analyze on a consistent basis and over a longer period of time, the performance of which it considers to be its core operations.  
Operating measures adjust GAAP information to exclude the effects of nonoperating items, such as gains or losses on certain asset sales, early
extinguishment of debt, employment contract buyouts, impairment charges, and other nonoperating expenses.

The limitations associated with utilizing operating measures are the risk that persons might disagree as to the appropriateness of items comprising
these measures and different companies might calculate these measures differently. Management compensates for these limitations by providing
detailed reconciliations between GAAP and operating measures. These disclosures should not be considered an alternative to GAAP results. A
reconciliation of GAAP results and non-GAAP measures is provided in the Quarterly Financial Data Supplement on our web site,
www.thesouthgroup.com, in the Investor Relations section under Quarterly Earnings.

2

2Q09 Financial Overview

Net loss available to common shareholders of $(111.5) million, or $(101.9) million
operating loss

Smaller, more focused balance sheet from sales and reductions of non-core loans
and securities (total assets down $697 million linked-quarter to $12.6 billion)

Period-end core deposit growth of 2.4% linked-quarter (representing growth in each
of the last 3 quarters)

Net interest margin improved by 13 bps linked quarter to 2.96%

Operating noninterest income increased 3.7% linked-quarter, driven primarily by
increases in mortgage banking income

Continued reductions in controllable operating noninterest expenses, although
credit-related costs and FDIC insurance increased

Loan loss reserve increased to 3.11% of total loans

Successful execution of the first phase of our capital plan with a 6/30/09 Tier 1
capital ratio of 12.36% and tangible common equity ratio of 6.07%, or 7.60%
reflecting conversion of the convertible preferred

Period-end common shares increased to 160.2 million due to the issuance of 75
million common shares in June offering (additional 10 million in July from
underwriters’ over-allotment)

3

Capital Plan: Update

API completed 7/1/09 ($3.1
million); other sales in process

Expect $15 million

Sale of Ancillary Businesses

Completed in June; automatically  
converts to common upon
shareholder approval (expected in
3Q09)

$94.5 million

Privately negotiated Mandatory Convertible
Exchange¹

Requires shareholder approval
referenced above

Expect $95.5 million

Public Tender for Mandatory Convertible
Exchange²

Requires shareholder approval
referenced above

Expect $20 - $30
million

Exchange Common for Hybrid Securities²

$75 million completed in June and
$10 million in July (underwriters’
over-allotment)

$85 million gross
proceeds

Common Equity Issuance

Tier 1 Common
Impact

Status/Timing

Description

1

2

3

¹   Participants received contingent mandatorily convertible preferred shares that automatically convert, subject to certain limitations, into 24 million shares of common stock upon shareholder approval of common shares issued upon conversion and an increase in authorized shares (shareholder meeting expected to be held 3Q09)

²   Subject to shareholder approval to increase authorized shares

4

5

Additional Capital Actions

Moved $150 million to Carolina First Bank to bolster bank-level capital ratios

Preferred dividend savings of approximately $35 million on mandatory convertible exchanges

Reduction in non-core loans and securities of approximately $700 million during 2Q09; estimated
Tier 1 Common benefit (using SCAP 4% requirement) of more than $20 million

4

Asset Quality Overview

6/30/09 NPAs of $560.7 million, a $47.8
million increase linked-quarter

Commercial NALs:

Declined approximately $50
million in FL

Increased by $98 million in SC
and NC as expected

Lot loans and consumer NALs
declined for the 2^nd quarter in a row

OREO up by $20 million

2Q09 NCOs $120.6 million, or 4.91% of
average loans annualized

2Q09 proceeds from problem loan
sales of $25 million (vs. $12 million
for 1Q09)

2Q09 provision of $131.3 million; loan
loss reserve increased to 3.11% at
6/30/09

Proactive revaluation of OREO carrying
values to reflect market declines

Gross Nonaccrual Loan Inflows

$ in millions

Proceeds from Problem Loan Sales

$ in millions

5

Loan and Credit Quality Composition

2.22%

$76.1

3.43%

$349   

$10,192

     12/31/08

1.16%

1.99%

1.86%

1.28%

4.64%

2.01%

3.54%

2.71%

4.68%

0.88%

0.91%

1.37%

30-Day
Past
Due %

$229.7

2.2

37.5

7.7

8.0

85.1

16.4

28.6

    5.2

  $39.0

YTD Net
Charge-
Offs

$109.1

4.24%

$423   

$9,987

     3/31/09

$75.4

$120.6

0.9

11.2

4.5

3.1

52.5

14.4

15.2

1.8

$17.0

QTD Net
Charge-
Offs

2.31%

$238   

$10,300

     9/30/08

4.99%

$465   

100%

$9,306

Total Loans HFI

9.68%

  49

   6%

      505

Mortgage¹

0.23%

    1

   3%

      286

Indirect – sales finance

0.61%

    5

   9%

      811

Home equity

0.09%

16.55%

6.95%

3.64%

1.84%

3.15%

NAL %
of  O/S
Balance

78

23%

2,135

Completed income
property

40

6%

585

Commercial
development

      87

1,153

   1,315

$ 2,429

O/S  
Balance

    1%

12%

  14%

  26%

% of
O/S
Balance

     --

Other¹

    24      

Owner-occupied CRE

  $77

C&I

191

Residential construction

Nonaccrual
Loans HFI

As of June 30, 2009, $ in millions

HFI = Held for Investment; 30-day past due % of outstanding balance excludes nonaccrual loans. Commercial Development includes Commercial A&D
and Commercial Construction.  Residential Construction includes Residential A&D, Residential Construction, Residential Condo, and Undeveloped Land.

¹ Mortgage includes Consumer Lot Loans of $178 million.  Other includes Direct Retail and Unsecured Lines.

6

Residential Construction

BY GEOGRAPHY:

Outstanding

Performing Loans¹

Nonaccrual Loans

Decline in Outstanding Balance

$ in millions

¹ Reflects outstanding loan balances net of nonaccrual loans

Reduced $476 million, or 29%, since 3/31/08

Nonaccrual loans increased 5% linked-quarter
($10 million)

FL down $42 million

Coastal SC up $44 million

As of June 30, 2009

- 14%

- 42%

- 23%

$962 million

$191 million

7

Mortgage Banking Portfolio

NALs decrease of $4 million
linked-quarter; second
consecutive qtr of declines

Decline in Lot Loan charge-
offs as nearing end of
“cleanup” in 4 developments
where originations departed
from product model

Reduced balances in Lot Loans
and Construction Perm by
$209 million (49%) since Y/E
2007

Mortgage restructured loans
of $10.6 million (excluded
from NALs) from working with
borrowers to do loan
modifications

$ in millions

¹   SIVA = Stated Income Verified Assets

$    3.5

$  10.2

21.90%

0.00%

2.60%

$  47.4

$  17.1

$  21.8

11.00%

0.16%

5.95%

$198.0

$   5.6

$ 20.9

7.25%

0.51%

8.67%

$289.3

1Q09

$ 12.6

$ 12.8

$  10.0

NAL $

$ 15.2

$ 29.9

$  20.8

NAL $

$   8.3

$ 16.3

$ 18.0

NAL $

$   1.0

20.02%

0.00%

5.22%

$ 64.0

$   8.9

13.20%

1.84%

6.34%

$225.5

$   1.8

5.59%

3.41%

7.90%

$290.7

4Q08

Construction Perm:

$ 78.8

$  38.2

Balance

1.70%

4.07%

30-89 DPD

0.00%

0.00%

90+ DPD

15.98%

26.17%

NAL %

$   2.2

$    1.7

NCO $

Lot Loans:

$249.1

$178.2

Balance

3.84%

4.86%

30-89 DPD

2.34%

0.27%

90+ DPD

6.12%

11.68%

NAL %

$   0.9

$    6.5

NCO $

SIVA¹Alt-A:

$   2.0

$   3.1

NCO $

2.94%

6.26%

NAL %

2.21%

2.73%

90+ DPD

1.89%

1.68%

30-89 DPD

$282.3

$288.4

Balance

3Q08

2Q09

8

Completed Income Property Portfolio

SC, $795

  37%

FL, $862

40%

NC, $395

  19%

As of June 30, 2009

Well-diversified by property type

Granular exposures, with average loan
size of $0.5 million; weighted average
time to maturity of 37.8 months

Some performance weakening due to
economic conditions

Other, $83

  4%

0.3%

0.4

Office

3.1%

11.2

Other

2.1%

1.4

Medical

1.3%

5.1

Retail

3.6%

2.9%

4.1%

4.6%

6.3%

7.4%

NAL %   
of O/S
Balance

$77.7

     Total

8.0

Mixed Use

8.8

Industrial

11.2

Hotel

12.9

Residential 1-4 fam.

$18.7

Multi-Family

NALs

Residential

  $204, 9%

Retail

$398, 19%

Mixed Use

$275, 13%

By Property Type

Total $2,135 million, or 23% of loans

By Geography

Multi-Family

  $251, 12%

Hotel

  $243, 11%

Industrial

  $213, 10%

Office

  $127, 6%

Other

  $357, 17%

Medical

  $67, 3%

Nonaccrual Loans

By Property Type

$ in millions

9

Shared National Credits

Plan to reduce non-core SNCs

Exiting deals when restructured

Amendments to reduce
commitments and improve
credit dynamics

In 2Q09, liquidated or entered into
contracts to sell approximately $90
million for a loss of $4.4 million

Lead agent banks based on # of
commitments

Top 3:

Bank of America, 37%

Wachovia, 28%

JPMorgan, 5%

TSFG is not lead agent on any
SNCs

¹   Excludes approximately $25 million in loans held for sale at June 30, 2009, subsequently liquidated in July

Committed:

Outstanding:¹

SNCs, Period-End

$1,233

982

$251

$722

601

$121

1Q09

$(128)

$1,105

   Total

(128)

854

Non-core

$      --

$251

Core

$(123)

$599

   Total

(121)

480

Non-core

$    (2)

$119

Core

$
Change

2Q09

SNCs Outstanding, $599 million¹

By Category

As of June 30, 2009, $ in millions

C&I, $412

  69%

CRE, $187

  31%

10

Other Real Estate Owned

OREO, $93.9 million¹

By Geography

As of June 30, 2009

2Q09 losses on OREO of $12.9 million

In 2Q09, sold $12.4 million with losses
on sale of $2.7 million

$1.8 million of the losses were on
one residential subdivision valued
and foreclosed 12 months ago

In view of market changes, proactively
revalued OREO older than 12 months
and also changed policy to 70% of
appraised value vs. previous 80%

Resulted in $10.2 million loss in
OREO write-downs during 2Q09

  (12)

   (3)

  (8)

-  OREO sales

OREO Flows

       44

        32

  27

+ Additions

  (10)

  --

  --

-  Write downs

     $94

     $74

   $45

Ending balance

$26

4Q08

     $74

       $45

Beginning balance

2Q09

1Q09

# of Months in OREO

FL, 50%

NC, 30%

SC, 18%

Other, 2%

0-3 mos,

41%

Note:  Numbers may not add due to rounding                                                      ¹   Based on $ balances in OREO; geography reflects property zip code

3-6 mos,

27%

6-9 mos, 18%

9-12 mos, 6%

>12 mos,

8%

$ in millions

11

2Q09 Operating Results

$(1.08)

$(1.12)

Per diluted share¹

OREO reappraisals/policy change to write properties
down to 70% of appraised value; loss on sale of loans

2.0

22.4

OREO/LHFS losses

Exceeded NCOs by $10.7 million; allowance at 3.11%

142.6

131.3

Provision for credit losses

$14 million for the value of common shares issued as
inducement for early conversion (vs. $6.5 million 1Q09)

16.4

21.8

Preferred stock dividends and
other

40%

39%

     Effective tax rate

91.0

$(101.9)

(130.5)

0.8

23.2

90.4

27.7

$85.9

2Q09

22.1

Pre-tax, pre-provision operating
income¹

24.1

Pre-tax, pre-credit operating
income¹

Issuance of 75 million shares on June 24, 2009

82.2

Weighted avg. shares

(120.5)

Pre-tax operating loss¹  

$(88.6)

Operating loss available to
common shareholders¹

$4.2 million increase from loan collection and foreclosed
asset/FDIC insurance; all other down $1.4 million

87.6

Operating noninterest expenses,
excluding OREO/LHFS losses¹

Higher mortgage banking income

26.7

Operating noninterest income¹

$85.0

1Q09

2Q09 NIM increased 13 bp to 2.96%

Net interest income

Comments

¹   Excludes non-operating items.  Net loss available to common shareholders totaled $(111.5) million for 2Q09 and $(90.8) million for 1Q09.  Net loss per
diluted share totaled $(1.23) for 2Q09 and $(1.10) for 1Q09.  See slide 23 for non-operating items.  Reconciliations of GAAP to non-GAAP measures
are provided on page 15 of the Quarterly Financial Data Supplement for 2Q09 available in the Investor Relations section of TSFG’s web site,
www.thesouthgroup.com.

In millions, except per share data

12

2Q09 – Unusual Items

X

  (9.5)

Loss on nonmortgage loans HFS ($4.4 for SNC sales, $0.5 gain for
indirect loan sale, and $5.5 on write down and transfer of 1 loan to
OREO)

X

(2.5)

Goodwill impairment related to non-banking subsidiaries

X

(0.8)

Severance charges, including amounts for 72 FTEs to be eliminated
effective 3Q09 (notified in June)

X

(5.7)

FDIC special assessment

X

    (17.4)

Impairment of long-lived assets (corporate campus $15.9,
branch/office closings $0.9, airplane $0.6)

X

           3.0

Net gain on extinguishment of debt ($8.3 gain on repurchase of
REIT preferred stock; $5.4 loss on early repo termination)

Included in:

     (14.0)

   $(12.9)

       $   4.6

Pre-Tax  
Amount

Inducement for early conversion of preferred stock, compared to
$6.5 million in 1Q09 (EPS purposes only; no capital impact)

Non-Operating Items:

Operating Items:

X

Loss on OREO, including policy change to write down all OREO to
70% of appraised value

X

Noninterest
Income

Noninterest
Expenses

Gain on securities, net of other than temporary impairment of $0.8

$ in millions

OREO = Other Real Estate Owned; HFS = Held for Sale; SNC = Shared National Credits

13

Capital Position

7.43%

5.31%

5.64%

Tier 1 common to risk-weighted
assets

11.93%

9.81%

9.30%

TCE plus reserves to risk-
weighted assets

8.79%

11.75%

10.10%

10.55%

13.53%

12.10%

6.05%

3/31/09
Actual

10.37%

13.74%

12.45%

7.88%

6/30/09

Pro Forma²

5%

10%

6%

5%

10%

6%

Well
Capitalized
Minimum

9.17%

12.55%

11.01%

10.30%

13.65%

12.36%

6.07%

6/30/09
Actual¹

Total risk-based

Leverage

CAROLINA FIRST BANK

Tier 1 risk-based

Total risk-based

Leverage      

Tier 1 risk-based

Tangible common equity (TCE) to
tangible assets

THE SOUTH FINANCIAL GROUP

$ in millions

¹  Estimated

²  Reflects the issuance of 10 million common shares from underwriters’ over-allotment (net proceeds of $9.45 million), conversion of
Series 2009 preferred into 24 million common shares ($94.5 million), conversion of remaining $95.5 million of Series 2008 Preferred
into common, and exchange of $25 million of hybrid capital instruments into common

14

Smaller, More Focused Balance Sheet

$1,014   

$13,602

$13,285

$12,588

     Total assets

$3,750

1,280

2,130

2,685

$7,507

4Q08

(765)

2,455

1,920

Total non-core loans HFI

(180)

2,124

1,950

Securities

$(555)   

$3,730

$3,195

Wholesale borrowings

52

1,174

1,332

Other

$(121)

Change
vs. YE ‘08

$7,532

1Q09

$7,386

Total core loans HFI

2Q09

$ in millions

Period-End Assets

2Q09 Reductions of Non-Core Assets

Approximately $25 million in HFS at 6/30/09
for transactions that closed in July

$(4.4) million

$90 million

Non-core loans – Liquidation of
Shared National Credits

Closed in June

$0.5 million

$230 million

Non-core loans – Sale of indirect
auto loans

$5.4 million

Gain/(loss)

Terminated $75 million in long-term
repurchase agreements (4.3% rate) for a
loss of $5.4 million

$120 million

Securities – Government agencies
(3.6% yield)

Approx.
Amount

Comments

Description

15

Net Interest Income and Margin

Repricing Opportunity – Customer CDs

2.28%

236

1Q10

3.54%

904

Beyond 1Q10

3.15%

660

4Q09

3.37%

1,171

3Q09

Avg.
Yield

%

Balance
$

Maturing in

Continued Growth in Core Deposits¹

$ in billions

+2.4

+2.8

+1.8

-10.5

-1.3

% LQ
Growth

0.02

--

Sale of securities

0.06

    2.0

Change in wholesale
funding rate and volume;
other

0.08

2.5

Change in customer
funding rate and volume

0.02

    0.6

Decrease in nonaccrual
loan interest reversals

--

     0.7

1 add’l day in quarter

--

(3.6)

Lower earning assets

(0.05)

(1.4)

Increase in nonperforming
assets and charge-offs

  2.96%

$87.0

2^ndQUARTER 2009

Estimated impact from:

$86.2

Net

Interest
Income
(FTE)

  2.83%

1^stQUARTER 2009

Net

Interest
Margin

$ in millions

NIM Roll forward

¹  Core deposits equal total deposits less both brokered deposits and time deposits

16

Wholesale Borrowings

By Maturity

$4,033

$3,195

$2,015

$1,180

Total wholesale
borrowings

--

  2,057

948

    1,109

Brokered CDs

293

    762

703

      59

FHLB advances

239

125

--

$  --

> 1 year

    239

    125

    12

  $ --

Total

--

1,011

2,729

$  --^*

Unused

Secured
capacity

   --

Repurchase
agreements

   12

$ --

1 year or
less

Other

Fed Reserve and
T,T&L

Fed funds purchased

As of June 30, 2009, $ in millions

$3.9 billion

at 3/31/09

Strong parent company
liquidity position

Parent company cash of
$105 million at 6/30/09

No debt maturities until
2033

Cash sufficient to satisfy
dividend requirements
through early 2012
subject to further
subsidiary bank capital
support as needed

Parent Company Liquidity

^*Excludes $150 million in excess cash at Federal Reserve at June 30, 2009

17

Operating Noninterest Income

0.2

0.8

      1.8

    1.2

    2.0

Mortgage banking income

$ Change

   $1.0

0.4

--

0.1

0.2     

(1.1)

    $0.6   

2Q09 vs.
1Q09

(0.1)

      0.8

    0.6

    0.8

Merchant processing income, net

  $27.7

   2.7

1.1

    2.6

    5.5

$13.0

2Q09

0.9

0.2

1.1

Gain/(loss) on certain derivative
activities

(0.3)

     2.9

    2.5

Bank-owned life insurance

(1.6)

      7.1

    6.6

Wealth management income

(0.3)

3.0

   2.3

Other

  $(2.6)

   $30.3

  $26.7

   Operating noninterest income¹

   $(1.4)

2Q09 vs.
2Q08

  $14.4

2Q08

$12.4

1Q09

Customer fee income

$ in millions

Mortgage banking income drove the increase for 2Q09; benefited from recent mortgage
leadership changes and higher mortgage loan originations (up 68% linked-quarter)

Customer fee, wealth management, and mortgage banking income comprise approximately 75%
of operating noninterest income  

¹   Excludes non-operating items.  Total noninterest income was $32.3 million for 2Q09, $23.7 million for 1Q09, and $32.2 million for 2Q08.  See slide 23
for non-operating items.  Reconciliations of GAAP to non-GAAP measures are provided on page 15 of the Quarterly Financial Data Supplement for 2Q09
available in the Investor Relations section of TSFG’s web site, www.thesouthgroup.com.

18

- $6.0

Staff reductions; 95 FTE
reductions in 3Q09, including 23
FTEs associated with API

With 3Q09 reductions,
down 10% since Y/E 2008
and below Y/E 2004 level

No merit pay increases

Project NOW efficiencies

Took additional actions to
reduce cost base:

Market corporate campus for
sale

Closed 3 branch/2 other
office locations 2Q09

Sale of corporate airplane

Sale of retirement plan
administration business (API)

Credit-related costs²   and FDIC insurance

Noninterest Expense Control

¹   Excludes non-operating items. Total noninterest expenses were $87.6 million for 2Q08, $94.2 million for 3Q08, $342.1 million for 4Q08, $90.2 million
for 1Q09, and $136.2 million for 2Q09.   See slide 24 in the Appendix for reconciliations of GAAP to non-GAAP measures.

²   Credit–related costs include loan and foreclosed asset expense, loss on nonmortgage loans held for sale, and gain/loss on OREO.

$112.8

$84.7

$89.7

$92.1

$ in millions

Operating Noninterest Expenses¹

$89.6

+$1.4

2,250

Pro Forma with Eliminations Effective 3Q09

2,572

2,535

2,505

2,430

2,345

# Employees (FTEs):

+$2.7

- $1.4

19

Expectations for 2009

Operating environment and results will remain challenging for remainder of 2009

Credit losses remain elevated in third quarter and begin to decline slowly; provisioning
depends on continuing economic developments

Potential expansion of margin due to pricing initiatives on both the loan and deposit side,
partially offset by lower indirect loans and overall credit impact

Net interest income will be impacted by non-core loan reductions

Continued expense headwinds from loan collection costs and FDIC insurance

Positive impact from Project NOW and other expense initiatives

Increase in weighted average shares outstanding to reflect Capital Plan actions

Continue to evaluate the realizability of the net deferred tax asset throughout 2009 for both
book and regulatory purposes

Run-off of non-core loan portfolio, partially offset by growth in lending to core customers;
similar to 1Q09 non-core run-off levels per quarter over remainder of 2009

Potential for FDIC transactions with appropriate loss-sharing arrangements if market overlap;
promotes efficiency and improves customer funding

Focus on cross sell, customer satisfaction, and other measures that support our strategic
positioning

20

2Q09 Execution of Strategic Actions

Strengthened capital position; raised $85 million in new common equity

Capital Plan well underway to fortify balance sheet with Tier 1 common

Capital

Reduced residential construction, lot loan, SNC, and indirect auto exposures

Increased loan loss reserve to 3.11% at 6/30/09

Continued recognition of loan and OREO losses (cycle-to-date NCOs $453 million)

Reduced controllable operating expenses

Reduced FTEs to 2,345 at 6/30/09; with add’l 95 3Q09, down 10% since Y/E ‘08

Closed 5 branches/offices, corporate campus for sale, airplane sale, API sale

Defined “who we are,” “how we compete,” and “how we measure success”

Strong management team in place; aligned management goals to strategy

Improved net interest margin to 2.96%, up 13 bps linked-quarter

Period-end core deposit growth, up 5% ($217 million) since Y/E ‘08

Credit

Vision

Balance Sheet
Management

Net Interest
Margin

Noninterest
Expense

Noninterest
Income

Reduced exposure to non-core loan categories by $534 million ($1.9 billion)

Reduced total assets by $697 million ($12.6 billion)

Strengthened liquidity – no overnight borrowings at 6/30/09

New leadership in mortgage drove 4% linked-quarter noninterest income
increase; mortgage originations up 68% linked-quarter

22

2Q09 Non-Operating Items

0.1

         0.1

        3.0

(Gain) loss on early extinguishment of debt

(2.3)

--

(0.8)

Employment contracts and severance

--

--

(2.5)

Goodwill impairment

--

--

(5.7)

FDIC special assessment

--

--

(17.4)

Impairment of long-lived assets

Non-operating noninterest expenses:

Non-operating noninterest income:

$(1.10)

$(90.8)

$(124.1)

--

(0.7)

(3.0)

$(120.5)

1Q09

--

--

Loss on repurchase of auction rate securities

$(0.23)

$(16.8)

$(19.0)

(0.7)

1.9

$(17.9)

2Q08

$(111.5)

Net loss (GAAP) available to common shareholders

$(149.3)

Pre-tax loss (GAAP)

$(130.5)

Pre-tax operating loss

--

Branch acquisition and conversion costs

$(1.23)

Per diluted share

4.6

2Q09

Gain (loss) on securities

Reconciliations of GAAP to non-GAAP measures are provided on page 15 of the Quarterly Financial Data Supplement for 1Q09
available in the Investor Relations section of TSFG’s web site, www.thesouthgroup.com.

$ in millions, except per share data

23

Reconciliations of GAAP to Non-GAAP Measures

$90.2

0.7

--

--

(0.1)

--

--

--

--

$89.6

1Q09

$87.6

--

--

0.7

(0.1)

2.3

--

--

--

$84.7

2Q08

$94.2

--

--

--

(0.1)

4.6

--

--

--

$89.7

3Q08

$342.1

--

1.1

--

1.7

9.6

237.6

--

--

$92.1

4Q08

$136.2

--

--

--

(3.0)

0.8

2.5

5.7

17.4

$112.8

2Q09

(Gain) loss on early extinguishment of debt

FDIC special assessment

Impairment of long-lived assets

Branch acquisition and conversion cost

Loss on derivative collateral

Employment contracts and severance

Goodwill impairment

Loss on repurchase of auction rate securities

Noninterest Expense:

      Total noninterest expense

Operating noninterest expense

$ in millions

24

Credit Quality Trends - Commercial

4.99%

$32.6

14.65%

$181

$1,235

1Q09

4.93%

$24.5

11.24%

$142

$1,263

4Q08

1.50%

$1.9

8.17%

$49

$606

1Q09

1.45%

$2.6

4.85%

$29

$608

4Q08

1.32%

$13.4

3.24%

$72

$2,202

1Q09

1.32%

$10.3

2.67%

$59

$2,203

4Q08

0.69%

$3.4

1.50%

$19

$1,285

1Q09

1.19%

$1.8

1.17%

$15

$1,271

4Q08

1.23%

$22.1

1.58%

$42

$2,646

1Q09

1.01%

$17.6

1.32%

$36

$2,723

4Q08

2Q09

2Q09

2Q09

2Q09

2Q09

16.55%

6.95%

3.64%

1.84%

3.15%

NAL % of  
O/S
Balance

  $52.5

    $14.4

    $15.2

    $1.8

  $17.0

QTD Net
Charge-offs

2.71%

4.68%

0.88%

0.91%

1.37%

30-day past
due %

    $78

   $2,135

Completed income

     $40

     $585

Commercial development

   $1,153

   $1,315

$ 2,429

Outstanding
Balance

      $24

Owner-occupied CRE

  $77

C&I

  $191

Residential construction

Nonaccrual
Loans HFI

$ in millions

HFI = Held for Investment; 30-day past due % of outstanding balance excludes nonaccrual loans.

25

Credit Quality Trends - Consumer

1.28%

    $0.9

0.09%

     $ --

      $87

2Q09

Other²

1.50%

$1.4

0.16%

$ --

$91

1Q09

7.44%

$26.3

9.90%

$53

$535

1Q09

9.46%

$11.7

10.17%

$59

$580

4Q08

0.90%

$3.2

0.77%

$6

$813

1Q09

1.42%

$2.4

1.01%

$8

$813

4Q08

1.62%

$4.8

0.09%

$1

$574

1Q09

2.21%

$5.0

0.11%

$1

$636

4Q08

4Q08

2Q09

2Q09

2Q09

4.64%

    $11.2

9.68%

    $49

      $505

Mortgage²

3.54%

    $3.1

0.23%

      $1

      $286

Indirect–sales finance¹

2.01%

    $4.5

0.61%

      $5

      $811

Home equity

0.26%

NAL % of  
O/S
Balance

$0.4

QTD Net
Charge-offs

3.04%

30-day
past due %

$95

Outstanding
Balance

$ --

Nonaccrual
Loans HFI

$ in millions

HFI = Held for Investment; 30-day past due % of outstanding balance excludes nonaccrual loans.

¹   Sold approximately $230 million in June 2009

²   Mortgage includes Consumer Lot Loans.  Other includes Direct Retail and Unsecured Lines.

26

Residential Construction by Geography

$85.1

$13.0

$10.4

$61.7

4.1

7.6

17.3

$32.7

YTD Net
Charge-
Offs

4.99%

$32.6

14.65%

$181

$1,235

     3/31/09   

4.93%

$24.5

11.24%

$142

$1,263

     12/31/08   

1.33%

$9.6

18.76%

$82

38%

$437

Total SC, 6/30/09

4.19%

$3.4

6.20%

$28

37%

$450

     3/31/09

3.09%

$6.7

8.20%

$21

21%

$264

     3/31/09

3.49%

$39.2

19.17%

$90 

41%

$472

Total FL, 6/30/09

6.63%

$22.5

25.20%

$132

42%

$521

     3/31/09

2.71%

$52.5

16.55%

$191

100%

$1,153

Overall Total,
6/30/09

1.76%

$44.6

9.03%

$127

$1,410

     9/30/08   

3.67%

$3.7

7.57%

$19

21%

$244

Total NC, 6/30/09

22.87%

30.71%

9.92%

22.24%

NAL %   
of  O/S
Balance

4.1

4.3

9.4

$21.4

QTD Net
Charge-
offs

1.22%

5.38%

3.31%

4.09%

30-day

past due
%

15

13%

153

FL residential A&D

14

4%

44

FL residential
construction

78

$197

O/S

Balance

7%

17%

% of
Resid.
Constr.

18

FL residential condo

   $44

FL undeveloped land

FL Residential Construction:

Nonaccrual
Loans HFI

As of June 30, 2009, $ in millions

30-day past due % of outstanding balance excludes nonaccrual loans; see slide 28 for detail for NC and SC

27

Residential Construction by Geography

$3.4

$9.6

4.4

1.0

4.2

$ --

$6.7

$3.7

--

1.1

2.0

$0.6

QTD Net
Charge-
offs

SC Residential Construction:

0.08%

5.9

48.27%

42

7%

87

SC residential condo

0.83%

1.2

11.26%

  8

7%

76

SC residential
construction

1.00%

5.9

18.75%

30

14%

157

SC residential A&D

3.02%

$ --

1.60%

 $  2

10%

$117

SC undeveloped land

1.33%

$13.0

18.76%

$82

38%

$437

Total SC, 6/30/09

4.19%

6.20%

$28

37%

$450

     3/31/09

3.67%

$10.4

7.57%

$19

21%

$244

Total NC, 6/30/09

3.09%

8.20%

$21

21%

$264

     3/31/09

1.87%

16.16%

8.83%

1.88%

NAL %   
of  O/S
Balance

--

3.7

6.0

$0.7

YTD Net
Charge-
offs

2.78%

-- %

5.12%

1.43%

30-day

past due
%

14

13%

153

NC residential A&D

  4

2%

23

NC residential
construction

11

$57

O/S

Balance

1%

5%

% of
Resid.
Constr.

--

NC residential condo

$  1

NC undeveloped land

NC Residential Construction:

Nonaccrual
Loans HFI

As of June 30, 2009, $ in millions

30-day past due % of outstanding balance excludes nonaccrual loans.

28

Commercial Nonaccruals – Net Balance

$410

  191

40

    78

      24

  $77

6/30/09
Nonaccrual
Loan
Balance

$340

  164

     36

    66

      21

  $53

Net
Balance
Less
Specific
Reserve

62%

$70

$139

$549

Total Commercial

63%

63%

64%

68%

54%

Net
Balance
as % of
Unpaid
Principal

    12

    25

102

Completed income
property

     5

     16

     57

Commercial
development

  261

      30

  $98

Unpaid
Principal¹

  70

      6

  $22

Cumulative
Net
Charge-
offs²

  27

Residential
construction

      3

Owner-occupied
CRE

  $23

C&I

6/30/09
Specific
Reserve³

$ in millions

-

=

-

=

Note: Numbers may not add due to rounding.

¹   Outstanding balance at default

²   Typically charge-down at nonaccrual to approximately 80% of most recent appraised value

³   Additional specific reserves are established as necessary based on estimated disposal costs, estimated holding period and current market
and economic conditions; recognized as charge-offs when realized.  However, these amounts do not include the qualitative components
within the overall allowance for credit loans.

63% at

3/31/09

29

Indirect – Sales Finance Portfolio

As of June 30, 2009, $ in millions

In 5/08, ceased production in Florida

Effective 1/09, offered only through
full relationship dealerships in NC and
SC

In 6/09, sold $230 million of indirect
loans to a third party financial
institution for a small gain

Toyota

  31%

Summary Statistics

69%

71%

66%

New %

31%

29%

34%

Used %

$728

$484

$244

6/08 Balance

68%

32%

659

711

$286

Total

71%

62%

Foreign %

29%

38%

Domestic %

658

661

Current FICO

708

718

Orig FICO

$180

$106

6/09 Balance

FL

NC/SC

30-day Past Dues, By Auto Make (Top 10)

Total $286 million, or 3% of loans

By Auto Make

3.70%

8

Hyundai

4.97%

7

Scion

3.77%

$239

   Top 10

4.12%

8

Jeep

3.96%

12

Nissan

4.46%

19

Dodge

4.34%

19

Ford

3.06%

24

Kia

5.18%

25

Chevrolet

2.98%

29

Honda

3.40%

$88

Toyota

30-day %

O/S$

Honda

  10%

Ford

  7%

Other

  28%

Chevrolet

  9%

Dodge

  7%

Kia

  8%

30

Home Equity Lines/Loans Portfolio

SC, $340

  42%

FL, $276

34%

NC, $129

  16%

As of June 30, 2009, $ in millions

Originated by TSFG sales force in-
market; no broker loans

Strong FICO scores

Conservative LTV position and usage
amounts

Not pushed as a growth product

Home Equity Portfolio = HE Line and HE Loan portfolios

Geography based on customer address

Other, $66

  8%

Summary Statistics

  NA

  NA

71%

WAvg Util %¹

69%

56%

44%

720

729

$811

Total

66%

70%

Orig WAvg LTV %

17%

65%

2^ndLien %

83%

35%

1^stLien %

703

724

Current FICO

709

732

Orig FICO

$161

$650

Balance $

Loans

Lines

2008, $117

  14%

2007, $151

  19%

2006, $123

  15%

2004 or before

$277, 34%

2005, $120

15%

By Vintage

Total $811 million, or 9% of loans

By Geography

2009, $23

  3%

¹   Includes HE lines with balances greater than zero

31

Current as of 7/21/09