SCBT Reports Third Quarter 2012 Financial Results;

COLUMBIA, S.C.--(BUSINESS WIRE)--SCBT Financial Corporation (NASDAQ: SCBT), the holding company for SCBT, today released its unaudited results of operations and other financial information for the three-month and nine-month periods ended September 30, 2012. Highlights of the third quarter 2012 include the following:

“OREO and merger costs remain volatile, and excluding these, our operating efficiency ratio improved to 58.9% from 60.8% in the second quarter of 2012. We are pleased with the earnings momentum we are building, which is the result of a balanced organic growth and merger and acquisition strategy.”

• Net income of $9.1 million, or $0.60 diluted EPS in 3Q 2012 compared to $8.0 million, or $0.55 diluted EPS in 2Q 2012 and $10.3 million, or $0.74 diluted EPS in 3Q 2011 (which included an acquisition gain);
• Operating earnings, which exclude merger and conversion expense, of $9.4 million, or $0.63 diluted EPS in 3Q 2012 compared to $9.4 million, or $0.63 diluted EPS in 2Q 2012 and $4.6 million, or $0.33 diluted EPS in 3Q 2011;
• Return on average assets was 0.83% annualized in 3Q 2012 compared to 0.75% in 2Q 2012 and 1.04% in 3Q 2011; Operating return on average assets was 0.87% in 3Q 2012 compared to 0.88% in 2Q 2012 and 0.47% in 3Q 2011;
• Return on average equity was 8.4% annualized in 3Q 2012 compared to 7.8% in 2Q 2012 and 10.8% in 3Q 2011; Operating return on average equity was 8.7% annualized in 3Q 2012 compared to 9.1% in 2Q 2012 and 4.8% in 3Q 2011;
• Net charge-offs of non-acquired loans increased to 0.85% annualized in 3Q 2012, compared to 0.77% annualized in 2Q 2012 and decreased from 1.16% annualized in 3Q 2011;
• Non-performing Assets (NPAs): 1.89% of total assets for 3Q 2012 compared to 1.90% for 2Q 2012 and 2.44% for 3Q 2011; 3.22% of loans and repossessed assets, excluding acquired assets, for 3Q 2012 compared to 3.32% for 2Q 2012 and 3.87% for 3Q 2011; and
• Legacy loan growth was $36.1 million or 5.8% annualized during 3Q 2012.

Quarterly Cash Dividend

The Board of Directors of SCBT has declared a quarterly cash dividend of $0.18 per share payable on its common stock. This per share amount is a $0.01, or 5.9%, increase to the dividend paid in the immediately preceding quarter and will be payable on November 23, 2012 to shareholders of record as of November 16, 2012.

Third Quarter 2012 Financial Performance

Please refer to the accompanying tables for detailed comparative data on results of operations and financial results.

The Company reported consolidated net income of $9.1 million, or $0.60 per diluted share for the three months ended September 30, 2012. Driving this increase from the prior quarter were an increase in net interest income, improved customer-oriented noninterest income, good control over noninterest expense, and partially offset by an increase in negative accretion on the indemnification asset.

“I am pleased with our overall performance for the third quarter. We have made consistent progress in most operating facets each quarter this year. This quarter we continued growing fee income, expanded the net interest margin, and controlled expenses well, all contributing to an improved efficiency ratio,” said Robert R. Hill, Jr., president and CEO of SCBT Financial Corporation. “We also experienced solid legacy loan growth of approximately 6.0% annualized. This loan growth came primarily in the commercial owner occupied and commercial and industrial categories as we continue to develop quality banking relationships across our footprint. During this quarter, we also completed the systems integration of Peoples Bancorporation, Inc. and announced the agreement to acquire The Savannah Bancorp, Inc., a merger that we plan to close in the fourth quarter. While we are continuing to experience improvement in operations and profitability, I remain encouraged by the significant momentum and potential we have to improve performance further and to take advantage of many opportunities to grow our customer base, performance, and earnings.”

Asset Quality

During the third quarter of 2012, SCBT continued to see improvement in asset quality with non-acquired nonperforming assets falling to 1.89% of total assets, classified assets declining by another $3.1 million to $157.5 and 30-89 day past due loans declined by $1.2 million from the second quarter of 2012. We continue to see improvement in the trailing average historical loan losses as the high charge-off quarters are replaced with much lower current loss rates.

At September 30, 2012, the allowance for non-acquired loan losses was $46.4 million or 1.84% of non-acquired period-end loans. The current allowance for loan losses provides .78 times coverage of period-end non-acquired nonperforming loans. Net charge-offs within the non-acquired portfolio were $5.3 million for the quarter or 0.85% annualized, up slightly from the second quarter of 2012 of $4.7 million or 0.77% annualized and down from the third quarter of 2011 of $7.2 million or 1.16% annualized. OREO costs increased to $4.0 million during the quarter, up from the second quarter amount of $2.1 million. This increase was primarily as the result of write downs of two properties totaling $1.7 million.

Net Interest Income and Margin

Non-taxable equivalent net interest income was $46.9 million for the third quarter of 2012, a $4.4 million increase from the second quarter, resulting from the following:

1. A $2.8 million interest income improvement in acquired covered loans due to increased expected cash flows;

2. Full quarter impact from the loans acquired in the Peoples Bancorporation acquisition of $1.3 million; and

3. Decrease of $310,000 in the company’s overall cost of funds.

Tax-equivalent net interest margin increased 8 basis points from the third quarter of 2011 and 34 basis points from the second quarter of 2012 to 5.03%. The Company’s average yield on interest-earning assets decreased 23 basis points while the average rate on interest-bearing liabilities decreased 30 basis points from the third quarter of 2011. During the third quarter of 2012, the Company’s average total assets increased to $4.3 billion and average earning assets increased to almost $3.8 billion. The growth in average total assets was supported by growth in average total deposits to $3.6 billion.

Noninterest Income and Expense

Noninterest income was $9.2 million in the third quarter of 2012 down $2.6 million from the second quarter of 2012 and down $11.6 million from third quarter of 2011. The third quarter of 2011 included an acquisition gain of $11.0 million from the BankMeridian transaction. From customer-oriented noninterest income (includes service charges, mortgage banking, bankcard services, and trust and investment services) the Company saw a significant increase in mortgage banking income due to the continued low interest rates for home mortgages and an increase in service charges on deposit accounts from the second quarter of 2012. Compared to the third quarter of 2011, there were improvements in all categories of customer-oriented noninterest income by approximately $2.0 million. The increases were totally offset by a $2.3 million increase in negative accretion on the FDIC indemnification asset compared to the second quarter of 2012 and by a $3.1 million increase compared to the third quarter of 2011. The increases in negative accretion were the result of the reduction of expected cash flows of the indemnification asset related to certain pools of acquired loans which had improved estimated cash flows. Other noninterest income declined from the second quarter of 2012 by $908,000 due primarily to lower recoveries from acquired assets, but it increased by $366,000 over the third quarter of 2011.

Noninterest expense was $38.0 million in the third quarter of 2012, up from $37.5 million in the second quarter. This increase from the second quarter of 2012 was primarily due to a $1.8 million increase in OREO expense driven by write downs of two properties and offset by a decline of $1.4 million in merger and conversion cost. The efficiency ratio improved during the quarter from 68.3% in the second quarter to 66.9%.

Balance Sheet and Capital

At the end of the third quarter of 2012, SCBT’s total assets were $4.3 billion, down from $4.4 billion at June 30, 2012. SCBT continued to reduce the balances of acquired loans and certificates of deposit. Since December 31, 2011, the company’s balance sheet has grown by more than $428.7 million, or 11.0%, due primarily to the second quarter closing of the Peoples Bancorporation, Inc acquisition. The asset growth was spread among increases in investment securities, acquired loans, non-acquired loans, premises and equipment, bank owned life insurance, and intangibles; and these were offset by declines in OREO of $9.3 million and decreases in FDIC receivables of $88.3 million. The asset growth was supported primarily by $337.0 million in core deposit growth, $45.9 million in correspondent bank federal funds purchased and $52.1 million in additional capital.

Book value per share and tangible book value per share increased to $28.71 and $23.46 at September 30, 2012, which represents increases of $0.54 and $0.60 per share from June 30, 2012 and $1.45 and $1.55 per share from September 30, 2011.

The company’s total risk-based capital ratio is estimated to increase to 15.3% from 15.1% at June 30, 2012 due primarily to a change in risk-weighted asset mix relative to the increase in capital. The Tier 1 leverage ratio is likewise estimated to increase slightly from 9.2% to 9.3%. The Company’s capital position remains “well-capitalized” by all measures at September 30, 2012.

“We continue to see our margin expand due in large part to continued credit improvement from our acquired loan portfolios,” said John C. Pollok, COO and CFO. “OREO and merger costs remain volatile, and excluding these, our operating efficiency ratio improved to 58.9% from 60.8% in the second quarter of 2012. We are pleased with the earnings momentum we are building, which is the result of a balanced organic growth and merger and acquisition strategy.”

SCBT Financial Corporation will hold a conference call on October 26^th at 11 a.m. ET during which management will review earnings and performance trends. Callers wishing to participate may call toll-free by dialing 877-883-0383. The number for international participants is 412-902-6506. The conference ID number is 2399551. Participants can also listen to the live audio webcast through the Investor Relations section of www.SCBTonline.com. A replay will be available beginning October 26^th by 2:00 p.m. ET until 9:00 a.m. on November 12th. To listen to the replay, dial 877-344-7529 or 412-317-0088. The pass code is 10018831.

SCBT Financial Corporation, Columbia, South Carolina is a registered bank holding company incorporated under the laws of South Carolina. The Company consists of SCBT; NCBT, a division of SCBT; and CBT, a division of SCBT. Providing financial services for over 78 years, SCBT Financial Corporation operates 75 locations in 19 South Carolina counties, 10 north Georgia counties, and Mecklenburg County in North Carolina. SCBT Financial Corporation has assets of approximately $4.3 billion, is the largest publicly traded bank holding company in South Carolina, and its stock is traded under the symbol SCBT in the NASDAQ Global Select Market. More information can be found at www.SCBTonline.com.

Non-GAAP Measures

Statements included in this press release include non-GAAP measures and should be read along with the accompanying tables which provide a reconciliation of non-GAAP measures to GAAP measures. Management believes that these non-GAAP measures provide additional useful information. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the company's results or financial condition as reported under GAAP.

Cautionary Statement Regarding Forward Looking Statements

Statements included in this press release which are not historical in nature are intended to be, and are hereby identified as, forward looking statements for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934. SCBT Financial Corporation (‘SCBT”) and The Savannah Bancorp, Inc. (SAVB”) cautions readers that forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from forecasted results. Such risks and uncertainties, include, among others, the following possibilities: (1) the occurrence of any event, change or other circumstances that could give rise to the termination of the definitive merger agreement between SCBT and SAVB; (2) the outcome of any legal proceedings that may be instituted against SCBT or SAVB; (3) the inability to complete the transactions contemplated by the definitive merger agreement due to the failure to satisfy each transaction’s respective conditions to completion, including the receipt of regulatory approval; (4) credit risk associated with an obligor's failure to meet the terms of any contract with the bank or otherwise fail to perform as agreed; (5) interest risk involving the effect of a change in interest rates on both the bank's earnings and the market value of the portfolio equity; (6) liquidity risk affecting the bank's ability to meet its obligations when they come due; (7) price risk focusing on changes in market factors that may affect the value of traded instruments in "mark-to-market" portfolios; (8) transaction risk arising from problems with service or product delivery; (9) compliance risk involving risk to earnings or capital resulting from violations of or nonconformance with laws, rules, regulations, prescribed practices, or ethical standards; (10) strategic risk resulting from adverse business decisions or improper implementation of business decisions; (11) reputation risk that adversely affects earnings or capital arising from negative public opinion; (12) terrorist activities risk that results in loss of consumer confidence and economic disruptions; (13) economic downturn risk resulting in deterioration in the credit markets; (14) greater than expected noninterest expenses; (15) excessive loan losses; (16) potential deposit attrition, higher than expected costs, customer loss and business disruption associated with the integration of Peoples Bancorporation and The Savannah Bancorp, Inc., including, without limitation, potential difficulties in maintaining relationships with key personnel and other integration related-matters; (17) the risks of fluctuations in market prices for SCBT stock that may or may not reflect economic condition or performance of SCBT; (18) the payment of dividends on SCBT is subject to regulatory supervision as well as the discretion of the SCBT board of directors; and (19) other factors, which could cause actual results to differ materially from future results expressed or implied by such forward looking statements.

SCBT Financial Corporation
(Unaudited)
(Dollars in thousands, except per share data)
																Third
	Three Months Ended															Quarter		Nine Months Ended						YTD
	September 30,			June 30,			March 31,			December 31,			September 30,			2012 - 2011		September 30,						2012 - 2011
EARNINGS SUMMARY (non tax equivalent)	2012			2012			2012			2011			2011			% Change			2012			2011		% Change
Interest income	$	49,535		$	45,470		$	42,220		$	43,825		$	45,307		9.3	%	$	137,225		$	127,893		7.3	%
Interest expense		2,625			2,936			3,182			3,900			4,627		-43.3	%		8,743			16,366		-46.6	%
Net interest income		46,910			42,534			39,038			39,925			40,680		15.3	%		128,482			111,527		15.2	%
Provision for loan losses (1)		4,044			4,641			2,723			7,057			8,323		-51.4	%		11,408			23,179		-50.8	%
Noninterest income		9,166			11,744			9,473			9,663			20,791		-55.9	%		30,383			45,456		-33.2	%
Noninterest expense		38,031			37,509			35,219			36,548			37,157		2.3	%		110,759			106,430		4.1	%
Income before provision for income taxes		14,001			12,128			10,569			5,983			15,991		-12.4	%		36,698			27,374		34.1	%
Provision for income taxes		4,938			4,097			3,541			1,154			5,658		-12.7	%		12,576			9,608		30.9	%
Net income	$	9,063		$	8,031		$	7,028		$	4,829		$	10,332		-12.3	%	$	24,122		$	17,766		35.8	%
Basic weighted-average common shares		14,920,423			14,650,914			13,882,801			13,845,444			13,818,012		8.0	%		14,484,214			13,612,811		6.4	%
Diluted weighted-average common shares		15,043,067			14,733,325			13,951,290			13,914,814			13,883,897		8.3	%		14,573,097			13,688,574		6.5	%
Earnings per share - Basic	$	0.61		$	0.55		$	0.51		$	0.35		$	0.75		-18.7	%	$	1.67		$	1.30		28.5	%
Earnings per share - Diluted		0.60			0.55			0.50			0.35			0.74		-18.9	%		1.66			1.28		29.7	%
Cash dividends declared per share	$	0.17		$	0.17		$	0.17		$	0.17		$	0.17		0.0	%	$	0.51		$	0.51		0.0	%
Dividend payout ratio (2)		31.97	%		36.48	%		49.48	%		23.07	%		48.39	%	-33.9	%		37.82	%		89.20	%	-57.6	%
Operating Earnings (non-GAAP) (3)
Net income (GAAP)	$	9,063		$	8,031		$	7,028		$	4,829		$	10,332		-12.3	%	$	24,122		$	17,766		35.8	%
Gains on acquisitions, net of tax		--			--			--			--			(6,806	)				--			(10,226	)
Other-than-temporary impairment (OTTI), net of tax		--			--			--			--			--					--			--
Merger and conversion related expense, net of tax		357			1,323			64			327			1,102		-67.6	%		1,744			1,890
Net operating earnings (loss) (non-GAAP)	$	9,420		$	9,354		$	7,092		$	5,156		$	4,628		103.5	%	$	25,865		$	9,430		174.3	%
Operating earnings (loss) per share - Basic	$	0.63		$	0.64		$	0.51		$	0.37		$	0.33		90.9	%	$	1.78		$	0.67		165.7	%
Operating earnings (loss) per share - Diluted		0.63			0.63			0.51			0.37			0.33		90.9	%		1.77			0.67		164.2	%
																Third
	AVERAGE for Quarter Ended															Quarter		AVERAGE for Nine Months						YTD
	September 30,			June 30,			March 31,			December 31,			September 30,			2012 - 2011		September 30,			September 30,			2012 - 2011
BALANCE SHEET HIGHLIGHTS		2012			2012			2012			2011			2011		% Change			2012			2011		% Change
Loans held for sale	$	56,300		$	29,604		$	34,073		$	52,743		$	21,331		163.9	%	$	40,052		$	18,003		122.5	%
Acquired loans, net of allowance for acquired loan losses		501,214			484,084			357,668			386,713			400,635		25.1	%		447,851			377,307		18.7	%
Non-acquired loans		2,497,478			2,456,069			2,456,080			2,467,363			2,444,199		2.2	%		2,469,977			2,374,386		4.0	%
Total loans (1)		2,998,692			2,940,153			2,813,748			2,854,076			2,844,834		5.4	%		2,917,828			2,751,693		6.0	%
FDIC receivable for loss share agreements		194,116			219,183			246,556			267,904			304,089		-36.2	%		219,858			281,622		-21.9	%
Total investment securities		501,816			468,334			324,473			317,940			304,642		64.7	%		431,797			263,459		63.9	%
Intangible assets		79,857			79,583			74,089			74,601			74,960		6.5	%		77,797			74,366		4.6	%
Earning assets		3,766,889			3,703,552			3,371,704			3,346,444			3,293,141		14.4	%		3,614,606			3,262,610		10.8	%
Total assets		4,331,436			4,295,911			3,957,918			3,947,773			3,935,427		10.1	%		4,195,406			3,889,734		7.9	%
Noninterest-bearing deposits		813,394			795,867			700,438			675,998			636,659		27.8	%		770,058			595,723		29.3	%
Interest-bearing deposits		2,800,446			2,808,884			2,570,595			2,614,304			2,641,830		6.0	%		2,726,912			2,637,370		3.4	%
Total deposits		3,613,840			3,604,751			3,271,033			3,290,302			3,278,489		10.2	%		3,496,970			3,233,093		8.2	%
Federal funds purchased and repurchase agreements		223,844			215,678			229,099			194,427			195,777		14.3	%		222,877			215,379		3.5	%
Other borrowings		45,908			46,203			46,480			46,774			47,272		-2.9	%		46,196			47,396		-2.5	%
Shareholders' equity		429,183			415,952			383,377			382,909			380,934		12.7	%		409,576			365,804		12.0	%

SCBT Financial Corporation
(Unaudited)
(Dollars in thousands, except per share data)
																Third
	ENDING Balance															Quarter
	September 30,			June 30,			March 31,			December 31,			September 30,			2012 - 2011
BALANCE SHEET HIGHLIGHTS	2012			2012			2012			2011			2011			% Change
Loans held for sale	$	71,585		$	42,525		$	34,706		$	45,809		$	45,870		56.1	%
Acquired loans		520,991			560,058			369,144			402,201			435,761		19.6	%
Non-acquired loans		2,517,352			2,481,251			2,437,314			2,470,565			2,461,639		2.3	%
Total loans (1)		3,038,343			3,041,309			2,806,458			2,872,766			2,897,400		4.9	%
FDIC receivable for loss share agreements		174,321			200,569			231,331			262,651			274,658		-36.5	%
Total investment securities		500,587			511,138			357,448			324,056			321,047		55.9	%
Intangible assets		79,391			79,971			73,926			74,426			74,949		5.9	%
Allowance for acquired loan losses		(31,138	)		(35,813	)		(34,355	)		(31,620	)		(29,870	)	4.2	%
Allowance for non-acquired loan losses (1)		(46,439	)		(47,269	)		(47,607	)		(49,367	)		(49,110	)	-5.4	%
Premises and equipment		105,579			106,458			93,209			94,250			90,020		17.3	%
Total assets		4,325,232			4,373,269			4,046,343			3,896,557			3,935,518		9.9	%
Noninterest-bearing deposits		818,633			806,235			757,777			658,454			653,924		25.2	%
Interest-bearing deposits		2,770,665			2,854,737			2,598,860			2,596,018			2,633,729		5.2	%
Total deposits		3,589,298			3,660,972			3,356,637			3,254,472			3,287,653		9.2	%
Federal funds purchased and repurchase agreements		226,330			220,264			235,412			180,436			184,403		22.7	%
Other borrowings		45,807			46,105			46,397			46,683			46,955		-2.4	%
Total liabilities		3,891,308			3,948,363			3,659,836			3,514,777			3,553,796		9.5	%
Shareholders' equity		433,924			424,906			386,507			381,780			381,722		13.7	%
Common shares issued and outstanding		15,114,185			15,085,991			14,052,177			14,039,422			14,004,372		7.9	%
																Third
																Quarter
	September 30,			June 30,			March 31,			December 31,			September 30,			2012 - 2011
NONPERFORMING ASSETS (ENDING BALANCE)	2012			2012			2012			2011			2011			% Change
Non-acquired
Non-acquired nonaccrual loans	$	46,295		$	47,940		$	59,278		$	64,170		$	61,163		-24.3	%
Restructured loans		12,882			9,530			10,578			11,807			11,698		10.1	%
Other real estate owned ("OREO") not covered under
FDIC loss share agreements		22,424			25,518			21,381			18,022			22,686		-1.2	%
Accruing loans past due 90 days or more		156			137			130			926			495		-68.5	%
Other nonperforming assets		--			--			24			24			24		-100.0	%
Total non-acquired nonperforming assets		81,757			83,125			91,391			94,949			96,066		-14.9	%
Acquired (7)
Acquired nonaccrual loans		--			--			--			--			--
OREO covered under FDIC loss share agreements		47,063			53,146			61,788			65,849			79,739		-41.0	%
OREO not covered under FDIC loss share agreements		5,059			5,745			--			--			--
Other nonperforming assets		57			73			215			251			347
Total acquired nonperforming assets		52,179			58,964			62,003			66,100			80,086		-34.8	%
Total nonperforming assets	$	133,936		$	142,089		$	153,394		$	161,049		$	176,152		-24.0	%
Excluding Acquired Assets
Total nonperforming assets as a percentage of
total non-acquired loans and repossessed assets (1) (4)		3.22	%		3.32	%		3.72	%		3.82	%		3.87	%
Total nonperforming assets as a percentage
of total assets (5)		1.89	%		1.90	%		2.26	%		2.44	%		2.44	%
NPLs as a percentage of period end non-acquired loans		2.36	%		2.32	%		2.87	%		3.11	%		2.98	%
Including Acquired Assets
Total nonperforming assets as a percentage of
total loans and repossessed assets (1) (4)		4.31	%		4.55	%		5.31	%		5.45	%		5.91	%
Total nonperforming assets as a percentage
of total assets		3.10	%		3.25	%		3.79	%		4.13	%		4.48	%
NPLs as a percentage of period end loans		1.95	%		1.89	%		2.49	%		2.68	%		2.55	%
OTHER ASSET QUALITY INFORMATION
Classified Assets (Ending Balance) (11)
Classified loans	$	135,095		$	135,099		$	156,118		$	166,383		$	157,569		-14.3	%
OREO and other nonperforming assets		22,424			25,518			21,405			18,046			22,710		-1.3	%
Total classified assets	$	157,519		$	160,617		$	177,523		$	184,429		$	180,279		-12.6	%
Tier 1 capital and non-acquired allowance for loan losses	$	444,200		$	436,964		$	406,070		$	402,470		$	398,231		11.5	%
Classified assets as a percentage of Tier 1 capital and
non-acquired allowance for loan losses		35.46	%		36.76	%		43.72	%		45.82	%		45.27	%
Non-acquired Loans 30-89 Day Past Due	$	9,270		$	10,464		$	7,290		$	9,235		$	8,371		10.7	%

SCBT Financial Corporation
(Unaudited)
(Dollars in thousands)
																Third
	Quarter Ended															Quarter		Nine Months Ended						YTD
	September 30,			June 30,			March 31,			December 31,			September 30,			2012 - 2011		September 30,			September 30,			2012 - 2011
ALLOWANCE FOR LOAN LOSSES (1)	2012			2012			2012			2011			2011			% Change		2012			2011			% Change
Non-acquired Loans:
Balance at beginning of period	$	47,269		$	47,607		$	49,367		$	49,110		$	48,180		-1.9	%	$	49,367		$	47,512		3.9	%
Loans charged off		(5,506	)		(5,114	)		(5,344	)		(6,846	)		(7,426	)	-25.9	%		(15,964	)		(22,235	)	-28.2	%
Overdrafts charged off		(434	)		(441	)		(354	)		(413	)		(432	)	0.5	%		(1,229	)		(750	)	63.9	%
Loan recoveries		481			700			1,424			409			569		-15.5	%		2,605			2,514		3.6	%
Overdraft recoveries		129			125			216			138			112		15.2	%		470			384		22.4	%
Net charge-offs		(5,330	)		(4,730	)		(4,058	)		(6,712	)		(7,177	)	-25.7	%		(14,118	)		(20,087	)	-29.7	%
Provision for loan losses on non-acquired loans		4,500			4,392			2,298			6,969			8,107		-44.5	%		11,190			21,685		-48.4	%
Balance at end of period, non-acquired loans		46,439			47,269			47,607			49,367			49,110		-5.4	%		46,439			49,110		-5.4	%
Acquired Loans:
Balance at beginning of period		35,812			34,355			31,620			29,870			25,545					31,620			--
Loans charged off		--			--			--			--			--					--			--
Loan recoveries		--			--			--			--			--					--			--
Net charge-offs		--			--			--			--			--					--			--
Provision for loan losses on acquired loans:
Provision for loan losses before benefit attributable
to FDIC loss share agreements		(4,674	)		1,457			2,735			1,750			4,325					(482	)		29,870
Benefit attributable to FDIC loss share agreements		4,218			(1,208	)		(2,310	)		(1,663	)		(4,109	)				699			(28,376	)
Net provision for loan losses on acquired loans		(456	)		249			425			87			216					217			1,494
Provision for loan losses recorded through the FDIC
loss share receivable		(4,218	)		1,208			2,310			1,663			4,109					(699	)		28,376
Balance at end of period, acquired loans		31,138			35,812			34,355			31,620			29,870					31,138			29,870
Balance at end of period, total allowance for loan losses	$	77,577		$	83,081		$	81,962		$	80,987		$	78,980		-1.8	%	$	77,577		$	78,980		-1.8	%
Total provision for loan losses charged to operations	$	4,044		$	4,641		$	2,723		$	7,057		$	8,323				$	11,408		$	23,179
Allowance for non-acquired loan losses as a
percentage of non-acquired loans (1)		1.84	%		1.91	%		1.95	%		2.00	%		2.00	%				1.84	%		2.00	%
Allowance for loan losses as a
percentage of total loans (1)		2.55	%		2.73	%		2.92	%		2.82	%		2.73	%				2.55	%		2.73	%
Allowance for non-acquired loan losses as a
percentage of non-acquired nonperforming loans		78.27	%		82.05	%		68.02	%		64.19	%		66.95	%				78.27	%		66.95	%
Net charge-offs on non-acquired loans as a percentage of
average non-acquired loans (annualized) (1)		0.85	%		0.77	%		0.66	%		1.08	%		1.16	%				0.76	%		1.13	%
																Third
																Quarter
	September 30,			June 30,			March 31,			December 31,			September 30,			2012 - 2011
LOAN PORTFOLIO (ENDING balance) (1)	2012			2012			2012			2011			2011			% Change
Acquired covered loans	$	309,034		$	332,874		$	363,050		$	394,495		$	427,466		21.9	%
Acquired non-covered loans		211,957			227,184			6,094			7,706			8,295		2455.2	%
Non-acquired loans:
Commercial non-owner occupied real estate:
Construction and land development		273,606			279,519			294,865			310,845			316,072		-13.4	%
Commercial non-owner occupied		278,935			284,147			284,044			299,698			304,616		-8.4	%
Total commercial non-owner occupied real estate		552,541			563,666			578,909			610,543			620,688		-11.0	%
Consumer real estate:
Consumer owner occupied		430,825			420,298			407,697			391,529			394,205		9.3	%
Home equity loans		255,677			257,061			258,054			264,986			264,588		-3.4	%
Total consumer real estate		686,502			677,359			665,751			656,515			658,793		4.2	%
Commercial owner occupied real estate		787,623			763,338			744,441			742,890			719,791		9.4	%
Commercial and industrial		245,285			228,010			216,083			220,454			216,573		13.3	%
Other income producing property		131,832			132,193			130,177			140,693			142,325		-7.4	%
Consumer non real estate		86,729			87,290			85,350			85,342			84,972		2.1	%
Other		26,840			29,395			16,603			14,128			18,471		45.3	%
Total non-acquired loans		2,517,352			2,481,251			2,437,314			2,470,565			2,461,613		2.3	%
Total loans (net of unearned income) (1)	$	3,038,343		$	3,041,309		$	2,806,458		$	2,872,766		$	2,897,374		4.9	%
Loans held for sale	$	71,585		$	42,525		$	34,706		$	45,809		$	45,870		56.1	%

SCBT Financial Corporation
(Unaudited)
(Dollars in thousands, except per share data)
	Quarter Ended																	Nine Months Ended
	September 30,			June 30,			March 31,			December 31,			September 30,					September 30,			September 30,
SELECTED RATIOS	2012			2012			2012			2011			2011					2012			2011
Return on average assets (annualized)		0.83	%		0.75	%		0.71	%		0.49	%		1.04	%				0.77	%		0.61	%
Operating return on average assets (annualized) (non-GAAP)		0.87	%		0.88	%		0.72	%		0.52	%		0.47	%				0.82	%		0.32	%
Return on average equity (annualized)		8.40	%		7.77	%		7.37	%		5.00	%		10.76	%				7.87	%		6.49	%
Operating return on average equity (annualized) (non-GAAP)		8.73	%		9.05	%		7.44	%		5.34	%		4.82	%				8.44	%		3.45	%
Return on average tangible equity (annualized) (non-GAAP) (10)		10.74	%		9.92	%		9.57	%		6.76	%		13.83	%				10.14	%		8.59	%
Net interest margin (tax equivalent)		5.03	%		4.69	%		4.70	%		4.78	%		4.95	%				4.82	%		4.60	%
Efficiency ratio (tax equivalent)		66.91	%		68.34	%		72.02	%		73.09	%		59.97	%				68.95	%		67.41	%
Operating efficiency ratio excluding OREO expense		58.96	%		60.84	%		66.27	%		62.43	%		50.77	%				61.83	%		59.67	%
Book value per common share	$	28.71		$	28.17		$	27.51		$	27.19		$	27.26
Tangible book value per common share (non-GAAP) (10)	$	23.46		$	22.86		$	22.24		$	21.89		$	21.91
Common shares issued and outstanding		15,114,185			15,085,991			14,052,177			14,039,422			14,004,372
Equity-to-assets		10.03	%		9.72	%		9.55	%		9.80	%		9.70	%
Tangible equity-to-tangible assets (non-GAAP) (10)		8.35	%		8.03	%		7.87	%		8.04	%		7.95	%
Tier 1 leverage (9)		9.3	%		9.2	%		9.2	%		9.1	%		9.0	%
Tier 1 risk-based capital (9)		14.0	%		13.9	%		14.5	%		14.0	%		13.9	%
Total risk-based capital (9)		15.3	%		15.1	%		15.8	%		15.3	%		15.1	%
	Quarter Ended																	Nine Months Ended
	September 30,			June 30,			March 31,			December 31,			September 30,					September 30,			September 30,
RECONCILIATION OF NON-GAAP TO GAAP	2012			2012			2012			2011			2011					2012			2011
Pre-tax, Pre-provision Operating Earnings (6)
Net income (GAAP)	$	9,063		$	8,031		$	7,028		$	4,829		$	10,332		-12.3	%	$	24,122		$	17,766		35.8	%
Provision for loan losses (1)		4,044			4,641			2,723			7,057			8,323		-51.4	%		11,408			23,179		-50.8	%
Provision for income taxes		4,938			4,097			3,541			1,154			5,658		-12.7	%		12,576			9,608		30.9	%
Pre-tax, pre-provision income		18,045			16,769			13,292			13,040			24,313		-25.8	%		48,106			50,553		-4.8	%
Gains on acquisitions		--			--			--			--			(11,001	)				--			(16,529	)
Merger and conversion related expense		567			1,998			96			404			1,587		-64.3	%		2,662			2,794
Pre-tax, pre-provision operating earnings (non-GAAP)	$	18,612		$	18,767		$	13,388		$	13,444		$	14,899		24.9	%	$	50,768		$	36,818		37.9	%
Operating efficiency ratio excluding OREO expense
Operating efficiency ratio excluding OREO expense		58.96	%		60.84	%		66.27	%		62.43	%		50.77	%				61.83	%		59.67	%
Effect to adjust for OREO and loan related expense		6.95	%		3.86	%		5.56	%		9.85	%		6.64	%				5.47	%		5.97	%
Effect to adjust for Merger and conversion expenses		1.00	%		3.64	%		0.19	%		0.81	%		2.56	%				1.65	%		1.77	%
Efficiency ratio (Tax Equivalent)		66.91	%		68.34	%		72.02	%		73.09	%		59.97	%				68.95	%		67.41	%
Operating Return of Average Assets
Operating return on average assets (non-GAAP)		0.87	%		0.88	%		0.72	%		0.52	%		0.47	%				0.82	%		0.32	%
Effect to adjust for acquisition gains		0.00	%		0.00	%		0.00	%		0.00	%		0.69	%				0.00	%		0.35	%
Effect to adjust for merger and conversion related expenses		-0.04	%		-0.13	%		-0.01	%		-0.03	%		-0.12	%				-0.05	%		-0.06	%
Return on average assets (GAAP)		0.83	%		0.75	%		0.71	%		0.49	%		1.04	%				0.77	%		0.61	%
Operating Return of Average Equity
Operating return on average equity (non-GAAP)		8.73	%		9.05	%		7.44	%		5.34	%		4.82	%				8.44	%		3.45	%
Effect to adjust for acquisition gains		0.00	%		0.00	%		0.00	%		0.00	%		7.09	%				0.00	%		3.74	%
Effect to adjust for merger and conversion related expenses		-0.33	%		-1.28	%		-0.07	%		-0.34	%		-1.15	%				-0.57	%		-0.70	%
Return on average equity (GAAP)		8.40	%		7.77	%		7.37	%		5.00	%		10.76	%				7.87	%		6.49	%

SCBT Financial Corporation
(Unaudited)
(Dollars in thousands)
	Quarter Ended																	Nine Months Ended
	September 30,			June 30,			March 31,			December 31,			September 30,					September 30,		September 30,
RECONCILIATION OF NON-GAAP TO GAAP (CONTINUED)	2012			2012			2012			2011			2011					2012		2011
Return on Average Tangible Equity (10)
Return on average tangible equity (non-GAAP)		10.74	%		9.92	%		9.57	%		6.76	%		13.83	%			10.14	%	8.59	%
Effect to adjust for tangible assets		-2.34	%		-2.15	%		-2.20	%		-1.76	%		-3.07	%			-2.27	%	-2.10	%
Return on average equity (GAAP)		8.40	%		7.77	%		7.37	%		5.00	%		10.76	%			7.87	%	6.49	%
Tangible Book Value Per Common Share (10)
Tangible book value per common share (non-GAAP)	$	23.46		$	22.86		$	22.24		$	21.89		$	21.91
Effect to adjust for tangible assets		5.25			5.30			5.26			5.30			5.34
Book value per common share (GAAP)	$	28.71		$	28.17		$	27.51		$	27.19		$	27.26
Tangible Equity-to-Tangible Assets (10)
Tangible equity-to-tangible assets (non-GAAP)		8.35	%		8.03	%		7.87	%		8.04	%		7.95	%
Effect to adjust for tangible assets		1.68	%		1.69	%		1.68	%		1.76	%		1.75	%
Equity-to-assets (GAAP)		10.03	%		9.72	%		9.55	%		9.80	%		9.70	%
	Three Months Ended
	September 30, 2012									September 30, 2011
	Average			Interest			Average			Average			Interest			Average
YIELD ANALYSIS	Balance			Earned/Paid			Yield/Rate			Balance			Earned/Paid			Yield/Rate
Interest-Earning Assets:
Federal funds sold, reverse repo, and time deposits	$	210,081		$	282			0.53	%		122,334		$	161		0.52	%
Investment securities (taxable)		480,208			2,893			2.40	%		276,793			2,023		2.90	%
Investment securities (tax-exempt)		21,608			181			3.33	%		27,849			211		3.01	%
Loans held for sale		56,300			492			3.48	%		21,331			178		3.31	%
Acquired loans, net of allowance for acquired loan losses		501,214			16,004			12.70	%		400,635			12,142		12.02	%
Non-acquired loans (1)		2,497,478			29,683			4.73	%		2,444,199			30,592		4.97	%
Total interest-earning assets		3,766,889			49,535			5.23	%		3,293,141			45,307		5.46	%
Noninterest-Earning Assets:
Cash and due from banks		80,332									68,861
Other assets		531,469									621,366
Allowance for non-acquired loan losses		(47,254	)								(47,940	)
Total noninterest-earning assets		564,547									642,287
Total Assets	$	4,331,436								$	3,935,427
Interest-Bearing Liabilities:
Transaction and money market accounts	$	1,548,650		$	712			0.18	%	$	1,335,423		$	1,388		0.41	%
Savings deposits		307,087			115			0.15	%		260,592			205		0.31	%
Certificates and other time deposits		944,709			1,143			0.48	%		1,045,815			2,364		0.90	%
Federal funds purchased and repurchase agreements		223,844			105			0.19	%		195,777			118		0.24	%
Other borrowings		45,908			550			4.77	%		47,272			552		4.63	%
Total interest-bearing liabilities		3,070,198			2,625			0.34	%		2,884,879			4,627		0.64	%
Noninterest-Bearing Liabilities:
Demand deposits		813,394									636,659
Other liabilities		18,661									32,955
Total noninterest-bearing liabilities ("Non-IBL")		832,055									669,614
Shareholders' equity		429,183									380,934
Total Non-IBL and shareholders' equity		1,261,238									1,050,548
Total liabilities and shareholders' equity	$	4,331,436								$	3,935,427
Net interest income and margin (NON-TAX EQUIV.)				$	46,910			4.95	%				$	40,680		4.90	%
Net interest margin (TAX EQUIVALENT)								5.03	%							4.95	%

SCBT Financial Corporation
(Unaudited)
(Dollars in thousands)
	Nine Months Ended
	September 30, 2012							September 30, 2011
	Average			Interest		Average		Average			Interest		Average
YIELD ANALYSIS	Balance			Earned/Paid		Yield/Rate		Balance			Earned/Paid		Yield/Rate
Interest-Earning Assets:
Federal funds sold, reverse repo, and time deposits	$	224,929		$	773	0.46	%	$	229,455		$	875	0.51	%
Investment securities (taxable)		408,801			7,800	2.55	%		234,437			5,621	3.21	%
Investment securities (tax-exempt)		22,996			576	3.35	%		29,022			662	3.05	%
Loans held for sale		40,052			1,089	3.63	%		18,003			472	3.51	%
Acquired loans, net of allowance for acquired loan losses		447,851			36,983	11.03	%		377,307			31,133	11.03	%
Non-acquired loans (1)		2,469,977			90,004	4.87	%		2,374,386			89,130	5.02	%
Total interest-earning assets		3,614,606			137,225	5.07	%		3,262,610			127,893	5.24	%
Noninterest-Earning Assets:
Cash and due from banks		88,935							80,763
Other assets		539,956							594,065
Allowance for non-acquired loan losses		(48,092	)						(47,702	)
Total noninterest-earning assets		580,799							627,126
Total Assets	$	4,195,406						$	3,889,734
Interest-Bearing Liabilities:
Transaction and money market accounts	$	1,509,328		$	2,559	0.23	%	$	1,298,152		$	5,269	0.54	%
Savings deposits		290,679			389	0.18	%		250,098			719	0.38	%
Certificates and other time deposits		926,905			3,788	0.55	%		1,089,122			8,347	1.02	%
Federal funds purchased and repurchase agreements		222,877			341	0.20	%		215,379			420	0.26	%
Other borrowings		46,196			1,666	4.82	%		47,396			1,611	4.54	%
Total interest-bearing liabilities		2,995,985			8,743	0.39	%		2,900,147			16,366	0.75	%
Noninterest-Bearing Liabilities:
Demand deposits		770,058							595,722
Other liabilities		19,787							28,061
Total noninterest-bearing liabilities ("Non-IBL")		789,845							623,783
Shareholders' equity		409,576							365,804
Total Non-IBL and shareholders' equity		1,199,421							989,587
Total liabilities and shareholders' equity	$	4,195,406						$	3,889,734
Net interest income and margin (NON-TAX EQUIV.)				$	128,482	4.75	%				$	111,527	4.57	%
Net interest margin (TAX EQUIVALENT)						4.82	%						4.60	%

SCBT Financial Corporation
(Unaudited)
(Dollars in thousands)
																Third
	Three Months Ended															Quarter		Nine Months Ended						YTD
	September 30,			June 30,			March 31,			December 31,			September 30,			2012 - 2011		September 30,						2012 - 2011
NONINTEREST INCOME & EXPENSE	2012			2012			2012			2011			2011			% Change		2012			2011			% Change
Noninterest income:
Gain on acquisition	$	--		$	--		$	--		$	--		$	11,001				$	--		$	16,529
Service charges on deposit accounts		6,169			5,886			5,447			5,959			6,050		2.0	%		17,501			16,695		4.8	%
Mortgage banking income		3,526			3,052			1,830			1,942			2,341		50.6	%		8,408			4,329		94.2	%
Bankcard services income		3,570			3,618			3,320			3,037			2,980		19.8	%		10,508			8,684		21.0	%
Trust and investment services income		1,577			1,642			1,397			1,237			1,453		8.5	%		4,617			4,227		9.2	%
Securities gains (losses), net (8)		--			61			--			(25	)		(100	)	100.0	%		61			233		-73.8	%
Accretion (amortization) on FDIC indemnification asset		(6,623	)		(4,370	)		(3,233	)		(3,086	)		(3,515	)	-88.4	%		(14,226	)		(7,049	)	101.8	%
Other		947			1,855			712			599			581		63.0	%		3,514			1,808		94.4	%
Total noninterest income	$	9,166		$	11,744		$	9,473		$	9,663		$	20,791		-55.9	%	$	30,383		$	45,456		-33.2	%
Noninterest expense:
Salaries and employee benefits	$	18,647		$	18,262		$	18,048		$	16,930		$	17,345		7.5	%	$	54,957		$	52,007		5.7	%
Net occupancy expense		2,621			2,478			2,248			2,309			2,443		7.3	%		7,347			7,365		-0.2	%
Furniture and equipment expense		2,165			2,371			2,239			2,211			2,127		1.8	%		6,775			6,265		8.1	%
Information services expense		2,662			2,902			2,468			2,817			2,851		-6.6	%		8,032			7,695		4.4	%
FDIC assessment and other regulatory charges		878			1,073			1,037			980			859		2.3	%		2,988			3,593		-16.8	%
OREO expense and loan related		3,951			2,115			2,716			4,835			4,118		-3.5	%		8,782			9,428		-6.9	%
Advertising and marketing		736			553			757			707			824		-10.6	%		2,046			2,022		1.2	%
Business development and staff related		878			689			752			944			802		9.5	%		2,319			1,763		31.5	%
Professional fees		643			732			633			253			377		71.1	%		2,008			1,311		53.2	%
Amortization of intangibles		566			540			500			523			517		9.5	%		1,606			1,468		9.4	%
Merger and conversion related expense		568			1,998			96			404			1,587		-64.3	%		2,662			2,794
Other		3,716			3,796			3,725			3,635			3,307		11.6	%		11,237			10,719		4.8	%
Total noninterest expense	$	38,031		$	37,509		$	35,219		$	36,548		$	37,157		2.3	%	$	110,759		$	106,430		4.1	%
Notes:
(1) Loan data excludes mortgage loans held for sale.
(2) The Company pays cash dividends on common shares out of earnings generated in the preceding quarter; therefore, the dividend payout ratio is calculated by dividing total dividends paid during the third quarter of 2012 by the total net income reported in the second quarter of 2012.
(3) Operating earnings is a non-GAAP measure and excludes the after-tax effect of gains on acquisitions, OTTI, and merger and conversion related expense. Management believes that non-GAAP operating earnings provides additional useful information that allows readers to evaluate the ongoing performance of the company. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the company's results or financial condition as reported under GAAP. Operating earnings (non-GAAP) excludes the following from net income (GAAP) on an after-tax basis: (a) pre-tax gain on acquisitions of $11.0 million for the quarter ended September 30, 2011; and (b) pre-tax Merger and conversion related expense of $568,000, $1,998,000, $96,000, $404,000 and $1.6 million, for the quarters ended September 30, 2012, June 30, 2012, March 31, 2012, December 31, 2011 and September 30, 2011, respectively.
(4) Repossessed assets includes OREO and other nonperforming assets.
(5) Calculated by dividing total non-acquired NPAs by total assets.
(6) Pre-tax, pre-provision operating earnings is a non-GAAP measure and excludes the effect of the provision for loan losses, the provision for income taxes, the gains on acquisitions, OTTI, merger and conversion related expense, and the termination fee for the former group insurance plan. Management believes that non-GAAP pre-tax, pre-provision operating earnings provides additional useful information that allows readers to evaluate the ongoing performance of the company. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the company's results or financial condition as reported under GAAP.
(7) Acquired loans are not included in non-performing loans because the accretion method is being used for all acquired loan pools.
(8) If an other-than-temporary impairment charge was recorded during the quarter, the amount would be reflected in the "securities gains (losses), net" line item.
(9) September 30, 2012 ratios are estimated and may be subject to change pending the final filing of the FR Y-9C; all other periods are presented as filed. All ratios are rounded down to one decimal point.
(10) The tangible measures are non-GAAP measures and exclude the effect of period end or average balance of intangible assets. The tangible return on equity measures also add back the after-tax amortization of intangibles to GAAP basis net income. Management believes that these non-GAAP tangible measures provide additional useful information, particularly since these measures are widely used by industry analysts for companies with prior merger and acquisition activities. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the company's results or financial condition as reported under GAAP. The sections titled "Reconciliation of Non-GAAP to GAAP" provide tables that reconcile non-GAAP measures to GAAP.
(11) Classified asset data excludes acquired assets.