American Community Bancshares 8-K Results of Operations and Financial Condition

Exhibit 99.1

PRESS RELEASE

FOR IMMEDIATE RELEASE

July 19, 2005

American Community Bancshares, Inc. Announces a 63% Increase in Earnings for the Quarter Ended June 30, 2005

Charlotte, North Carolina, – American Community Bancshares, Inc. (stock NASDAQ SmallCap: ACBA) the holding company for American Community Bank (ACB), announced higher unaudited earnings for the three months ended June 30, 2005 of $1,066,000 or a 62.8% increase over unaudited earnings for the three months ended June 30, 2004 of $655,000. Earnings per share (diluted) for the three months ended June 30, 2005 increased to $0.24 compared to $0.18 for the three months ended June 30, 2004. The annualized return on average assets for the quarter was 1.06% with an annualized return on average equity of 9.39%.

Total assets at June 30, 2005 were $419.3 million, with loan and lease receivables of $322.5 million, deposits of $329.9 million, borrowings of $39.0 million, and stockholders’ equity of $49.2 million. Total assets increased 13.9% or $51.2 million, from June 30, 2004, loan and lease receivables increased 15.0% or $41.9 million, deposits increased 17.8% or $49.9 million and borrowings decreased 24.3% or $12.5 million.

The allowance for loan losses represented 1.15% of total loans at June 30, 2005. Non-performing loans, the majority of which are secured by real estate, totaled $742,000 or 0.23% of loans at June 30, 2005 compared to $378,000 or 0.13% of loans at June 30, 2004, a $364,000 or a 96% increase. Non-performing assets (which includes foreclosed real estate and repossessed assets) totaled $990,000 at June 30, 2005 and represented 0.24% of total assets compared to $527,000 or 0.14% of total assets at June 30, 2004, a $463,000 or an 87.9% increase.

Net interest income for the quarter ended June 30, 2005 totaled $3.9 million, an increase of 33% over the $2.9 million for the quarter ended June 30, 2004. Primarily as a result of Federal Reserve rate increases, the Company’s net interest margin continued to improve increasing to 4.21% for the quarter ended June 30, 2005 from 4.03% for the quarter ended March 31, 2005. Currently approximately 61% of the loan portfolio is floating rate and adjusts with movements in the bank’s prime lending rate.

Non-interest income was basically unchanged for the three months ended June 30, 2005 from the three months ended June 30, 2004. In addition, operating expenses increased $266,000 or 10.1% from $2.6 million for the three months ended June 30, 2004 to $2.9 million for the three months ended June 30, 2005 primarily as a result of the opening of two new branches during the second quarter of 2005.

American Community Bancshares, headquartered in Charlotte, NC is the holding company for American Community Bank. American Community Bank is a full service community bank, headquartered in Monroe, NC with five offices in Union County, North Carolina’s fastest growing county. The Bank also has three offices in Mecklenburg County, home of Charlotte, North Carolina’s largest city and the nation’s second largest financial center and three offices in Cherokee County, SC. Two additional branches, one in the South End historical district of Charlotte and one in the Tega Cay area of York County, SC, opened during the second quarter of 2005. The Bank provides a wide assortment of traditional banking and financial services offered with a high level of personal attention. American Community Bancshares website iswww.americancommunitybank.com. American Community Bancshares stock is traded on the NASDAQ SmallCap market under the symbol “ACBA”. For more information contact- Stephanie Helms, Shareholder Relations or Dan Ellis, CFO at (704) 225- 8444.

American Community Bancshares, Inc.

(Amounts in thousands except share and per share data)

(Unaudited)

Consolidated Balance Sheet

	June 30, 2005			March 31, 2005			December 31, 2004 (a)			September 30, 2004			June 30, 2004
Assets
Cash and due from banks	$	13,518		$	11,478		$	9,511		$	7,448		$	5,960
Interest-earning deposits with banks		2,970			5,833			6,521			10,608			5,774
Investment securities		53,253			49,680			54,019			46,769			51,488
Loans		326,266			312,970			307,988			290,398			283,995
Allowance for loan losses		(3,738	)		(3,562	)		(3,488	)		(3,478	)		(3,413	)
Net loans		322,528			309,408			304,500			286,920			280,582
Accrued interest receivable		1,915			1,842			1,697			1,537			1,407
Bank premises and equipment		10,032			9,171			8,741			8,263			8,284
Foreclosed real estate		176			221			311			214			122
Non-marketable equity securities at cost		1,996			2,139			2,040			1,392			1,088
Goodwill		9,838			9,838			9,838			10,149			10,125
Other assets		3,116			2,492			2,280			2,272			3,285
Total assets	$	419,342		$	402,102		$	399,458		$	375,572		$	368,115
Liabilities and stockholders’ equity
Deposits
Non-interest bearing	$	51,702		$	46,120		$	45,501		$	40,977		$	41,718
Interest bearing		278,188			268,377			261,164			244,208			238,277
Total deposits		329,890			314,497			306,665			285,185			279,995
Borrowings		39,049			46,521			54,169			52,164			51,578
Accrued expenses and other liabilities		1,218			1,626			1,652			1,946			1,865
Total liabilities		370,157			362,644			362,486			339,295			333,438
Total stockholders’ equity		49,185			39,458			36,972			36,277			34,677
Total liabilities and stockholders’ equity	$	419,342		$	402,102		$	399,458		$	375,572		$	368,115
Ending shares outstanding		4,533,633			3,706,806			3,489,249			3,471,228			3,446,753
Book value per share		10.85			10.64			10.60			10.45			10.06

(a) Derived from audited consolidated financial statements

American Community Bancshares, Inc.

Consolidated Income Statements

(Amounts in thousands except share and per share data)

(Unaudited)

Three months ended	June 30, 2005			March 31, 2005			December 31, 2004 (a)			September 30, 2004			June 30, 2004
Total interest income	$	6,003		$	5,672		$	5,290		$	4,971		$	4,421
Total interest expense		2,116			1,981			1,780			1,602			1,492
Net interest income		3,887			3,691			3,510			3,369			2,929
Provision for loan losses		182			109			158			157			140
Net interest income after provision for loan loss		3,705			3,582			3,352			3,212			2,789
Non-interest income
Service charges on deposit accounts		585			513			628			628			585
Mortgage banking operations		133			88			119			71			108
Realized gains on sale of securities		—			10			7			41			—
Other		162			136			130			129			189
Total non-interest income		880			747			884			869			882
Non-interest expense
Salaries and employee benefits		1,400			1,350			1,255			1,278			1,316
Occupancy and equipment		527			485			472			474			440
Other		969			813			1,441			836			874
Total non-interest expense		2,896			2,648			3,168			2,588			2,630
Income before income taxes		1,689			1,681			1,068			1,493			1,041
Provision for income taxes		623			633			392			556			386
Net income	$	1,066		$	1,048		$	676		$	937		$	655
Net income per share
Basic	$	0.25		$	0.29		$	0.19		$	0.27		$	0.20
Diluted	$	0.24		$	0.26		$	0.17		$	0.25		$	0.18
Weighted average number of shares outstanding
Basic		4,267,577			3,598,295			3,472,863			3,453,019			3,344,713
Diluted		4,462,648			4,055,590			3,989,045			3,784,314			3,703,920
Return on average equity		9.39	%		11.11	%		7.36	%		10.55	%		8.16	%
Return on average assets		1.06	%		1.05	%		0.70	%		1.00	%		0.73	%
Net interest margin		4.21	%		4.03	%		3.97	%		3.97	%		3.46	%
Allowance for loan losses to total loans		1.15	%		1.14	%		1.13	%		1.20	%		1.20	%
Net charge-offs to avg loans (annualized)		0.01	%		0.01	%		0.20	%		0.13	%		0.09	%
Nonperforming loans to total loans		0.23	%		0.24	%		0.29	%		0.31	%		0.13	%
Nonperforming assets to total assets		0.24	%		0.27	%		0.30	%		0.30	%		0.14	%