ex99-1.htm

News Release

For Immediate Release:	For More Information,
October 28, 2010	Contact: Jerry L. Ocheltree
	910-576-6171

First Bancorp Reports Third Quarter Results

TROY, N.C. – First Bancorp (NASDAQ - FBNC), the parent company of First Bank, announced today net income available to common shareholders of $2.8 million, or $0.17 per diluted common share, for the three months ended September 30, 2010 and $9.1 million, or $0.54 per diluted common share, for the nine months ended September 30, 2010. For the three and nine months ended September 30, 2009, the Company reported earnings of $5.4 million, or $0.32 per diluted common share, and $52.0 million, or $3.12 per diluted common share, respectively.

In the second quarter of 2009, the Company realized a $67.9 million gain related to the acquisition of Cooperative Bank in Wilmington, North Carolina. The after-tax impact of this gain was $41.1 million, or $2.46 per diluted common share.

Net Interest Income and Net Interest Margin

Net interest income for the third quarter of 2010 amounted to $31.1 million, a 1.8% increase over the third quarter of 2009. This increase was due to a higher net interest margin, which was partially offset by a lower level of earning assets due to a contraction of the balance sheet over the past twelve months (see below).

Net interest income for the nine months ended September 30, 2010 amounted to $93.8 million, a 23.3% increase over the comparable period of 2009. This increase was due to a higher net interest margin, as well as balance sheet growth realized from the June 2009 Cooperative Bank acquisition.

The Company’s net interest margin (tax-equivalent net interest income divided by average earnings assets) in the third quarter of 2010 was 4.30% and a 47 basis point increase from the 3.83% margin realized in the third quarter of 2009. For the nine months ended September 30, 2010, the net interest margin was 4.27%, a 51 basis point increase compared to 3.76% for the comparable period of 2009. The primary reason the higher net interest margins in 2010 is that the Company has been able to lower rates on maturing time deposits that were originated in periods of higher interest rates. Also, the Company has experienced declines in higher cost deposit accounts.

The third quarter 2010 net interest margin of 4.30% was a slight decline from the 4.35% margin experienced in the second quarter of 2010. This decline was impacted by a lower level of purchase accounting adjustments, which have increased net interest income and are primarily associated with the Cooperative Bank acquisition. See page 5 of the Financial Summary for a table that presents the impact of purchase accounting adjustments.

Provision for Loan Losses and Asset Quality

The Company’s provision for loan losses amounted to $8.4 million in the third quarter of 2010 compared to $8.0 million in the second quarter of 2010 and $5.2 million in the third quarter of 2009. The provision for loan losses for the nine months ended September 30, 2010 was $24.0 million compared to $13.6 million for the comparable period in 2009.

The higher provision for loan losses is a result of higher levels of classified and nonperforming assets and the impact of declining real estate values on the Company’s collateral dependent real estate loans. The increases in the provisions for loan losses are primarily attributable to the Company’s “non-covered” loan portfolio, which excludes loans assumed from Cooperative Bank that are subject to loss share agreements with the FDIC and which were written down to estimated fair market value in connection with initially recording the acquisition.

The Company’s non-covered nonperforming assets amounted to $118 million at September 30, 2010, compared to $108 million at June 30, 2010 and $66 million at September 30, 2009. At September 30, 2010, the ratio of non-covered nonperforming assets to total non-covered assets was 4.16%, compared to 3.89% at June 30, 2010, and 2.23% at September 30, 2009.

The Company’s ratio of annualized net charge-offs to average non-covered loans was 1.06% for the third quarter of 2010 compared to 1.04% in the second quarter of 2010 and 0.72% in the third quarter of 2009.

The Company’s nonperforming assets that are covered by FDIC loss share agreements amounted to $181 million at September 30, 2010, compared to $187 million at June 30, 2010 and $133 million at September 30, 2009. The Company continues to submit reimbursement claims to the FDIC on a regular basis.

Noninterest Income

Total noninterest income was $4.0 million in the third quarter of 2010 compared to $5.7 million for the third quarter of 2009. The decline in 2010 was primarily a result of a $0.5 million decline in service charges on deposits and $1.4 million in other losses (primarily write-downs, as described below). The decline in service charges on deposits is primarily due to lower insufficient fund fee charges, which declined during the third quarter of 2010 as a result of less instances of customers overdrawing their accounts. This was partially a result of new regulations that took effect in the third quarter of 2010 that limit the Company’s ability to charge overdraft fees.

Total noninterest income for the nine months ended September 30, 2010 was $14.2 million, compared to $83.3 million for the nine months ended September 30, 2009. The year-to-date period in 2009 includes a $67.9 million gain related to the June 2009 acquisition of Cooperative Bank. Most other categories of noninterest income increased as a result of the larger customer base that resulted from the Cooperative Bank acquisition.

For the three and nine months ended September 30, 2010, the Company recorded $1.3 million and $2.5 million, respectively, in write-downs (net of FDIC reimbursable amounts) on foreclosed properties covered by FDIC loss sharing agreements, which is included in “Other gains (losses)” in the accompanying schedules. The write-downs were necessary as a result of updated appraisals obtained on foreclosed real estate properties during the respective periods.

Noninterest Expenses

Noninterest expenses amounted to $20.7 million in the third quarter of 2010, a 1.2% decrease from the $21.0 million recorded in the same period of 2009. Noninterest expenses for the nine months ended September 30, 2010 amounted to $64.9 million, a 15.8% increase from the $56.1 million recorded in the first nine months of 2009. This increase is attributable to incremental operating expenses associated with the Cooperative Bank acquisition that occurred in the second quarter of 2009. Included in other operating expenses for the first nine months of 2010 are approximately $1.8 million in costs (net of FDIC reimbursements) associated with collection activities on loans and foreclosed properties covered by FDIC loss sharing agreements, compared to $0.1 million for the first nine months of 2009.

Balance Sheet and Capital

Total assets at September 30, 2010 amounted to $3.4 billion, a 4.7% decrease from a year earlier. Total loans at September 30, 2010 amounted to $2.5 billion, a 7.9% decrease from a year earlier, and total deposits amounted to $2.8 billion at September 30, 2010, a 5.8% decrease from a year earlier. The contraction of the Company’s balance sheet has been primarily a result of weak loan demand, which has allowed the Company to lessen its reliance on higher cost sources of funding, including internet and brokered deposits.

The Company continues to experience a general decline in loans, with loans decreasing approximately $143 million, or 5.4%, since December 31, 2009. Although the Company originates and renews a significant amount of loans each month, normal paydowns of loans are exceeding new loan growth. Overall, loan demand remains weak in most of the Company’s market areas.

The Company’s deposits declined by $182 million, or 6.2%, during the first nine months of 2010. This decrease was primarily associated with time deposits, which are generally the highest cost source of funds for the Company. Brokered deposits remained at a low level at September 30, 2010, comprising just 3.4% of total deposits, with internet deposits comprising an additional 1.9%.

The Company remains well-capitalized by all regulatory standards with a Total Risk-Based Capital Ratio of 16.74% compared to the 10.00% minimum to be considered well-capitalized. The Company’s tangible common equity to tangible assets ratio was 6.55% at September 30, 2010, an increase of 75 basis points from a year earlier. The Company continues to have outstanding $65 million in preferred stock that was issued to the US Treasury in January 2009.

Comments of the President and Other Business Matters

Jerry L. Ocheltree, President and CEO of First Bancorp, commented on today’s report, “I am pleased that our company’s strength and high performance allows us to continue to report profits and pay cash dividends during this prolonged period of economic weakness.”

“Over the past few months, we have held celebrations throughout our branch network in recognition of First Bank’s 75th anniversary. It has been a privilege to meet so many First Bank customers and say ‘thank you.’ To those customers I have not met, let me take this opportunity to say ‘Thank you for your business. We really appreciate it, and we hope we are serving you well,’” stated Mr. Ocheltree.

Mr. Ocheltree noted the following other corporate developments:

First Bank recently introduced Mobile Banking, which allows customers access to their bank account using their mobile phone. Additionally, for iPhone® users, First Bank has an app available that provides one touch access. For additional information, please visit our website at www.FirstBancorp.com.

On August 24, 2010, the Company announced a quarterly cash dividend of $0.08 cents per share payable on October 25, 2010 to shareholders of record on September 30, 2010. This is the same dividend rate as the Company declared in the third quarter of 2009.

There was no stock repurchase activity during 2010.

First Bancorp is a bank holding company headquartered in Troy, North Carolina with total assets of approximately $3.4 billion. Its principal activity is the ownership and operation of First Bank, a state-chartered community bank that now operates 92 branches, with 77 branches operating in the central Piedmont and coastal regions of North Carolina, 9 branches in South Carolina (Cheraw, Dillon, Florence, Latta, Jefferson, and Little River), and 6 branches in Virginia (Abingdon, Christiansburg, Dublin, Fort Chiswell, Radford, and Wytheville), where First Bank does business as First Bank of Virginia. First Bank also has a loan production office in Blacksburg, Virginia. First Bancorp’s common stock is traded on the NASDAQ Global Select Market under the symbol “FBNC.”

Please visit our website at www.FirstBancorp.com.

This press release contains statements that could be deemed forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995, which statements are inherently subject to risks and uncertainties. Forward-looking statements are statements that include projections, predictions, expectations or beliefs about future events or results or otherwise are not statements of historical fact. Such statements are often characterized by the use of qualifying words (and their derivatives) such as “expect,” “believe,” “estimate,” “plan,” “project,” “anticipate,” or other statements concerning opinions or judgments of the Company and its management about future events. Factors that could influence the accuracy of such forward-looking statements include, but are not limited to, the financial success or changing strategies of the Company’s customers, the Company’s level of success in integrating acquisitions, actions of government regulators, the level of market interest rates, and general economic conditions. For additional information about the factors that could affect the matters discussed in this paragraph, see the “Risk Factors” section of the Company’s most recent annual report on Form 10-K.

First Bancorp and Subsidiaries

Financial Summary

	Three Months Ended September 30,						Percent
($ in thousands except per share data - unaudited)	2010			2009			Change

INCOME STATEMENT

Interest income
Interest and fees on loans	$	36,897			41,404
Interest on investment securities		1,778			1,882
Other interest income		135			188
Total interest income		38,810			43,474			(10.7	%)
Interest expense
Interest on deposits		7,245			12,169
Other, primarily borrowings		494			795
Total interest expense		7,739			12,964			(40.3	%)
Net interest income		31,071			30,510			1.8	%
Provision for loan losses		8,391			5,200			61.4	%
Net interest income after provision for loan losses		22,680			25,310			(10.4	%)
Noninterest income
Service charges on deposit accounts		3,350			3,811
Other service charges, commissions, and fees		1,325			1,216
Fees from presold mortgages		404			395
Commissions from financial product sales		325			333
Data processing fees		–			38
Securities gains (losses)		1			6
Other gains (losses)		(1,448	)		(58	)
Total noninterest income		3,957			5,741			(31.1	%)
Noninterest expenses
Personnel expense		11,309			11,450
Occupancy and equipment expense		2,812			3,083
Intangibles amortization		219			218
Acquisition expenses		–			290
Other operating expenses		6,371			5,912
Total noninterest expenses		20,711			20,953			(1.2	%)
Income before income taxes		5,926			10,098			(41.3	%)
Income taxes		2,078			3,716			(44.1	%)
Net income	$	3,848			6,382			(39.7	%)

Preferred stock dividends and accretion		(1,027	)		(995	)

Net income available to common shareholders	$	2,821			5,387			(47.6	%)


Earnings per common share – basic	$	0.17			0.32			(46.9	%)
Earnings per common share – diluted		0.17			0.32			(46.9	%)

ADDITIONAL INCOME STATEMENT INFORMATION
Net interest income, as reported	$	31,071			30,510
Tax-equivalent adjustment (1)		330			221
Net interest income, tax-equivalent	$	31,401			30,731			2.2	%

(1)

This amount reflects the tax benefit that the Company receives related to its tax-exempt loans and securities, which carry interest rates lower than similar taxable investments due to their tax-exempt status. This amount has been computed assuming a 39% tax rate and is reduced by the related nondeductible portion of interest expense.

First Bancorp and Subsidiaries

Financial Summary - Page 2

	Nine Months Ended September 30,						Percent
($ in thousands except per share data - unaudited)	2010			2009			Change

INCOME STATEMENT

Interest income
Interest and fees on loans	$	112,724			107,596
Interest on investment securities		5,650			5,688
Other interest income		463			293
Total interest income		118,837			113,577			4.6	%
Interest expense
Interest on deposits		23,476			34,818
Other, primarily borrowings		1,577			2,696
Total interest expense		25,053			37,514			(33.2	%)
Net interest income		93,784			76,063			23.3	%
Provision for loan losses		24,017			13,611			76.5	%
Net interest income after provision for loan losses		69,767			62,452			11.7	%
Noninterest income
Service charges on deposit accounts		10,408			10,035
Other service charges, commissions, and fees		4,048			3,542
Fees from presold mortgages		1,216			847
Commissions from financial product sales		1,087			1,164
Data processing fees		32			103
Gain from acquisition		–			67,894
Securities gains (losses)		25			(113	)
Other gains (losses)		(2,628	)		(209	)
Total noninterest income		14,188			83,263			(83.0	%)
Noninterest expenses
Personnel expense		33,733			29,828
Occupancy and equipment expense		8,654			7,262
Intangibles amortization		654			414
Acquisition expenses		–			1,082
Other operating expenses		21,907			17,507
Total noninterest expenses		64,948			56,093			15.8	%
Income before income taxes		19,007			89,622			(78.8	%)
Income taxes		6,780			34,631			(80.4	%)
Net income	$	12,227			54,991			(77.8	%)

Preferred stock dividends and accretion		(3,080	)		(2,958	)

Net income available to common shareholders	$	9,147			52,033			(82.4	%)


Earnings per share - basic	$	0.55			3.13			(82.4	%)
Earnings per share - diluted		0.54			3.12			(82.7	%)

ADDITIONAL INCOME STATEMENT INFORMATION
Net interest income, as reported	$	93,784			76,063
Tax-equivalent adjustment (1)		956			571
Net interest income, tax-equivalent	$	94,740			76,634			23.6	%

(1) See footnote 1 on page 1 of Financial Summary for discussion of tax-equivalent adjustments.

First Bancorp and Subsidiaries

Financial Summary - page 3

	Three Months Ended September 30,						Nine Months Ended September 30,
PERFORMANCE RATIOS (annualized)	2010			2009			2010			2009
Return on average assets (1)		0.34	%		0.61	%		0.37	%		2.35	%
Return on average common equity (2)		3.89	%		7.86	%		4.30	%		22.85	%
Net interest margin – tax-equivalent (3)		4.30	%		3.83	%		4.27	%		3.76	%
Efficiency ratio – tax-equivalent (3) (4)		58.58	%		57.45	%		59.62	%		35.08	%
Net charge-offs to average non-covered loans		1.06	%		0.72	%		1.04	%		0.52	%

COMMON SHARE DATA
Cash dividends declared - common	$	0.08			0.08		$	0.24			0.24
Stated book value - common		17.04			16.28			17.04			16.28
Tangible book value - common		12.83			12.01			12.83			12.01
Common shares outstanding at end of period		16,785,750			16,671,983			16,785,750			16,671,983
Weighted average shares outstanding - basic		16,779,554			16,664,544			16,754,678			16,636,646
Weighted average shares outstanding - diluted		16,807,135			16,805,770			16,784,032			16,674,649

CAPITAL RATIOS
Tangible equity to tangible assets		8.52	%		7.68	%		8.52	%		7.68	%
Tangible common equity to tangible assets		6.55	%		5.80	%		6.55	%		5.80	%
Tier I leverage ratio		10.25	%		9.18	%		10.25	%		9.18	%
Tier I risk-based capital ratio		15.48	%		13.34	%		15.48	%		13.34	%
Total risk-based capital ratio		16.74	%		14.59	%		16.74	%		14.59	%

AVERAGE BALANCES ($ in thousands)
Total assets	$	3,272,161			3,525,812		$	3,343,223			2,955,972
Loans		2,529,356			2,763,178			2,577,640			2,405,030
Earning assets		2,894,660			3,180,200			2,966,424			2,723,234
Deposits		2,777,358			2,923,300			2,835,494			2,428,366
Interest-bearing liabilities		2,613,762			2,886,799			2,692,570			2,376,409
Shareholders’ equity		353,061			336,963			349,639			304,457

(1) Calculated by dividing annualized net income available to common shareholders by average assets.

(2) Calculated by dividing annualized net income available to common shareholders by average common equity.

(3) See footnote 1 on page 1 of Financial Summary for discussion of tax-equivalent adjustments.

(4) Calculated by dividing noninterest expense by the sum of tax-equivalent net interest income plus noninterest income.

TREND INFORMATION

($ in thousands except per share data)	For the Three Months Ended
INCOME STATEMENT	September 30, 2010		June 30, 2010		March 31, 2010		December 31, 2009		September 30, 2009

Net interest income – tax-equivalent (1)	$	31,401		31,867		31,472		31,280		30,731
Taxable equivalent adjustment (1)		330		331		295		247		221
Net interest income		31,071		31,536		31,177		31,033		30,510
Provision for loan losses		8,391		8,003		7,623		6,575		5,200
Noninterest income		3,957		4,537		5,694		6,255		5,741
Noninterest expense		20,711		21,957		22,280		22,458		20,953
Income before income taxes		5,926		6,113		6,968		8,255		10,098
Income taxes		2,078		2,172		2,530		2,987		3,716
Net income		3,848		3,941		4,438		5,268		6,382
Preferred stock dividends and accretion		1,027		1,026		1,027		1,014		995
Net income available to common shareholders		2,821		2,915		3,411		4,254		5,387

Earnings per common share – basic		0.17		0.17		0.20		0.25		0.32
Earnings per common share – diluted		0.17		0.17		0.20		0.25		0.32

(1) See footnote 1 on page 1 of Financial Summary for discussion of tax-equivalent adjustments.

First Bancorp and Subsidiaries

Financial Summary - page 4

CONSOLIDATED BALANCE SHEETS ($ in thousands)	At Sept. 30, 2010			At June 30, 2010			At Dec. 31, 2009			At Sept. 30, 2009			One Year Change
Assets
Cash and due from banks	$	51,812			59,944			60,071			43,667			18.7	%
Interest bearing deposits with banks		267,863			153,630			290,801			240,425			11.4	%
Total cash and cash equivalents		319,675			213,574			350,872			284,092			12.5	%

Investment securities		194,708			210,629			214,168			196,607			-1.0	%
Presold mortgages		3,226			3,123			3,967			8,420			-61.7	%

Loans – non-covered		2,096,439			2,099,099			2,132,843			2,147,615			-2.4	%
Loans – covered by FDIC loss share agreements		413,735			455,477			520,022			578,485			-28.5	%
Total loans		2,510,174			2,554,576			2,652,865			2,726,100			-7.9	%
Allowance for loan losses		(44,999	)		(42,215	)		(37,343	)		(34,444	)		30.6	%
Net loans		2,465,175			2,512,361			2,615,522			2,691,656			-8.4	%

Premises and equipment		54,039			54,026			54,159			52,868			2.2	%
FDIC loss share receivable		93,125			118,072			143,221			187,029			-50.2	%
Intangible assets		70,577			70,797			70,948			71,165			-0.8	%
Other real estate owned – non-covered		17,475			14,690			8,793			6,963			151.0	%
Other real estate owned – covered		101,389			80,074			47,430			10,439			871.3	%
Other assets		40,948			40,996			36,276			16,255			151.9	%
Total assets	$	3,360,337			3,318,342			3,545,356			3,525,494			-4.7	%


Liabilities
Deposits:
Non-interest bearing demand	$	290,388			293,555			272,422			268,097			8.3	%
NOW accounts		370,654			356,626			362,366			264,267			40.3	%
Money market accounts		492,983			494,979			496,940			477,092			3.3	%
Savings accounts		154,955			157,343			149,338			142,391			8.8	%
Brokered time deposits		94,073			91,195			76,332			122,634			-23.3	%
Internet time deposits		53,246			54,535			128,024			158,680			-66.4	%
Other time deposits > $100,000		641,970			668,044			704,128			706,343			-9.1	%
Other time deposits		653,213			678,611			743,558			782,136			-16.5	%
Total deposits		2,751,482			2,794,888			2,933,108			2,921,640			-5.8	%

Repurchase agreements		68,157			61,766			64,058			58,209			17.1	%
Borrowings		158,907			76,579			176,811			176,927			-10.2	%
Other liabilities		30,836			36,371			28,996			32,336			-4.6	%
Total liabilities		3,009,382			2,969,604			3,202,973			3,189,112			-5.6	%

Shareholders’ equity
Preferred stock		65,000			65,000			65,000			65,000			0.0	%
Discount on preferred stock		(3,146	)		(3,361	)		(3,789	)		(3,990	)		-21.2	%
Common stock		99,303			98,973			98,099			97,745			1.6	%
Common stock warrants		4,592			4,592			4,592			4,592			0.0	%
Retained earnings		188,028			186,552			182,908			179,988			4.5	%
Accumulated other comprehensive income		(2,822	)		(3,018	)		(4,427	)		(6,953	)		-59.4	%
Total shareholders’ equity		350,955			348,738			342,383			336,382			4.3	%
Total liabilities and shareholders’ equity	$	3,360,337			3,318,342			3,545,356			3,525,494			-4.7	%

First Bancorp and Subsidiaries

Financial Summary - page 5

	For the Three Months Ended
YIELD INFORMATION	September 30, 2010			June 30, 2010			March 31, 2010			December 31, 2009			September 30, 2009

Yield on loans		5.79	%		5.86	%		5.90	%		5.97	%		5.94	%
Yield on securities – tax-equivalent (1)		4.26	%		4.38	%		4.13	%		3.97	%		4.23	%
Yield on other earning assets		0.32	%		0.32	%		0.38	%		0.36	%		0.34	%
Yield on all interest earning assets		5.36	%		5.46	%		5.37	%		5.35	%		5.45	%

Rate on interest bearing deposits		1.16	%		1.22	%		1.32	%		1.61	%		1.82	%
Rate on other interest bearing liabilities		1.52	%		1.54	%		1.41	%		1.17	%		1.36	%
Rate on all interest bearing liabilities		1.17	%		1.23	%		1.32	%		1.58	%		1.78	%

Interest rate spread – tax-equivalent (1)		4.19	%		4.23	%		4.05	%		3.77	%		3.67	%
Net interest margin – tax-equivalent (2)		4.30	%		4.35	%		4.16	%		3.92	%		3.83	%

Average prime rate		3.25	%		3.25	%		3.25	%		3.25	%		3.25	%

___________________________________________________________________________________________________________________________

(1) See footnote 1 on page 1 of Financial Summary for discussion of tax-equivalent adjustments.

(2) Calculated by dividing annualized tax-equivalent net interest income by average earning assets for the period. See footnote 1 on page 1 of Financial Summary for discussion of tax-equivalent adjustments.

	For the Three Months Ended
NET INTEREST INCOME PURCHASE ACCOUNTING ADJUSTMENTS	September 30, 2010			June 30, 2010			March 31, 2010			December 31, 2009			September 30, 2009
	Positive (negative) impact on net interest income

Interest income – reduced by premium amortization on loans	$	(49	)		(49	)		(49	)		(49	)		(49	)
Interest income – increased by accretion of loan discount		1,231			1,659			1,484			1,469			−
Interest expense – reduced by premium amortization of deposits		296			731			1,184			1,639			2,072
Interest expense – reduced by premium amortization of borrowings		72			116			116			116			116
Impact on net interest income	$	1,550			2,457			2,735			3,175			2,139

First Bancorp and Subsidiaries

Financial Summary - page 6


ASSET QUALITY DATA ($ in thousands)	Sept. 30, 2010			June 30, 2010			March 31, 2010			Dec. 31, 2009			Sept. 30, 2009

Non-covered nonperforming assets
Nonaccrual loans	$	80,318			73,152			63,415			62,206			51,015
Restructured loans		20,447			20,392			27,207			21,283			6,963
Accruing loans > 90 days past due		-			-			-			-			-
Total non-covered nonperforming loans		100,765			93,544			90,622			83,489			57,978
Other real estate		17,475			14,690			10,818			8,793			7,549
Total non-covered nonperforming assets	$	118,240			108,234			101,440			92,282			65,527

Covered nonperforming assets (1)
Nonaccrual loans (2)	$	75,116			98,669			105,043			117,916			122,308
Restructured loans		4,160			8,450			11,379			-			-
Accruing loans > 90 days past due		-			-			-			-			-
Total covered nonperforming loans		79,276			107,119			116,422			117,916			122,308
Other real estate		101,389			80,074			68,044			47,430			10,439
Total covered nonperforming assets	$	180,665			187,193			184,466			165,346			132,747

Total nonperforming assets	$	298,905			295,427			285,906			257,628			198,274
Asset Quality Ratios – All Assets
Net charge-offs to average loans - annualized		0.88	%		0.85	%		0.81	%		0.54	%		0.57	%
Nonperforming loans to total loans		7.17	%		7.86	%		7.94	%		7.59	%		6.61	%
Nonperforming assets to total assets		8.90	%		8.90	%		8.43	%		7.27	%		5.62	%
Allowance for loan losses to total loans		1.79	%		1.65	%		1.52	%		1.41	%		1.26	%
Allowance for loan losses to nonperforming loans		24.99	%		21.04	%		19.17	%		18.54	%		19.11	%

Asset Quality Ratios – Based on Non-covered Assets only
Net charge-offs to average non-covered loans - annualized		1.06	%		1.04	%		1.01	%		0.69	%		0.72	%
Non-covered nonperforming loans to non-covered loans		4.81	%		4.46	%		4.28	%		3.91	%		2.70	%
Non-covered nonperforming assets to total non-covered assets		4.16	%		3.89	%		3.58	%		3.10	%		2.23	%
Allowance for loan losses to non-covered loans		2.15	%		2.01	%		1.87	%		1.75	%		1.60	%
Allowance for loan losses to non-covered nonperforming loans		44.66	%		45.13	%		43.80	%		44.73	%		59.41	%

(1) Covered nonperforming assets consist of assets that are included in loss-share agreements with the FDIC. (2) At September 30, 2010, the contractual balance of the nonaccrual loans covered by the FDIC loss share agreements was $103.9 million.