SouthCrest Financial Group, Inc. (SCSG) 8-K SouthCrest Financial Group, Inc. Announces Second Quarter Earnings

Exhibit 99.1

SouthCrest Financial Group, Inc. Announces Second Quarter Earnings

FAYETTEVILLE, GA, (August 11, 2006) - SouthCrest Financial Group, Inc. (SCSG) reported net income for the quarter ended June 30, 2006 of $1,426,000 or $0.40 per share, compared to $1,358,000 or $0.38 per share for the same quarter a year ago. For the six month period ended June 30, 2006, net income was $2,832,000, or $0.79 per share compared to $2,177,000, or $0.61 per share. All per share amounts are stated on a basic and fully diluted basis.

Total assets at June 30, 2006 were $461.2 million compared to $425.3 million at June 30, 2005, an increase of $35.9 million, or 8.4%. Over the same twelve month period, gross loans (excluding reserves for loan losses) increased 16.2% to $287.5 million while deposits grew 6.7% to $389.2 million.

Return on average assets for the current quarter was 1.26% and was 1.27% for the year to date period ended June 30, 2006.

At June 30, 2006, the allowance for loan losses was 1.31 % of loans compared to 1.26% at December 31, 2005. For the six months ended June 30, 2006, the Company experienced net recoveries of 0.03% compared to net chargeoffs of 0.16% for the same period in 2005. Nonperforming assets increased to $1,526,000 from $1,111,000 at December 31, 2005. Despite the increase in nonperforming assets, the Company’s asset quality indicators compare favorably with historical benchmarks for the industry. At June 30, 2006, nonperforming assets were 0.33% of total assets compared to 0.25% of total assets at December 31, 2005.

In a press release dated July 3, 2006, the Company announced that it declared a dividend of $0.125 per share compared to $0.12 per share for the same period a year ago. The dividend was paid on July 31, 2006 to shareholders of record as of July 17, 2006.

About SouthCrest Financial Group, Inc.

SouthCrest Financial Group, Inc. is the parent company of two bank subsidiaries operating a total of nine branch offices. Bank of Upson, based in Thomaston, Georgia, has two branches in Upson County, three branches in Meriwether County operating as Meriwether Bank & Trust, and one branch in Fayette County operating as SouthCrest Bank. First National Bank of Polk County, based in Cedartown, Georgia, operates three branches in Polk County. SouthCrest is traded on the OTC-Bulletin Board under the symbol “SCSG.”

Forward-Looking Statements

This release contains forward-looking statements including statements relating to present or future trends or factors generally affecting the banking industry and specifically affecting SouthCrest’s operations, markets and products. Without limiting the foregoing, the words "believes," "anticipates," "intends," "expects," or similar expressions are intended to identify forward-looking statements. These forward-looking statements involve risks and uncertainties. Actual results could differ materially from those projected for many reasons, including, without limitation, changing events and trends that have influenced SouthCrest’s assumptions, but that are beyond SouthCrest’s control. These trends and events include (i) changes in the interest rate environment which may reduce margins, (ii) not achieving expected growth, (iii) less favorable than anticipated changes in the national and local business environment and securities markets, (iv) adverse changes in the regulatory requirements affecting SouthCrest, (v) greater competitive pressures among financial institutions in SouthCrest’s markets and (vi) greater loan losses than historic levels. Additional information and other factors that could affect future financial results are included in SouthCrest’s filings with the Securities and Exchange Commission.

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Contact Information:

SouthCrest Financial Group, Inc.

Doug Hertha, CFO

770-461-2781

SouthCrest Financial Group, Inc.
Consolidated Financial Highlights
(Unaudited)
	Quarter Ended June 30									Six Months Ended June 30
	2006			2005			% Change			2006			2005			% Change
All dollars in thousands except per share data
EARNINGS
Net interest income	$	4,624		$	4,315			7.2	%	$	9,205		$	8,461			8.8	%
Provision for loan losses		133			152			-12.5	%		241			273			-11.7	%
Noninterest income		1,311			1,229			6.7	%		2,479			1,749			41.7	%
Noninterest expense		3,685			3,413			8.0	%		7,230			6,814			6.1	%
Income taxes		691			621			11.3	%		1,381			946			46.0	%
Net income		1,426			1,358			5.0	%		2,832			2,177			30.1	%
PER SHARE INFORMATION
Earnings per share	$	0.40		$	0.38			5.3	%	$	0.79		$	0.61			29.5	%
Dividends per share		0.125			0.120			4.2	%		0.250			0.240			4.2	%
Book value per share		15.43			14.67			5.2	%
OPERATING RATIOS (1)
Net interest margin		4.45	%		4.47	%					4.48	%		4.44	%
Return on average assets		1.26	%		1.29	%					1.27	%		1.05	%
Return on average equity		10.45	%		10.51	%					10.51	%		8.54	%
Efficiency ratio		62.09	%		61.56	%					63.18	%		63.03	%
Net chargeoffs / average loans		0.00	%		0.18	%					-0.03	%		0.16	%
AVERAGE BALANCES
Loans	$	282,696		$	237,533			19.0	%	$	279,406		$	233,226			19.8	%
Total earning assets		417,095			388,666			7.3	%		414,491			384,018			7.9	%
Total assets		454,372			422,135			7.6	%		451,403			417,908			8.0	%
Deposits		385,893			365,303			5.6	%		381,008			361,528			5.4	%
Borrowed funds		11,137			884			n/m			13,175			629			n/m
Shareholders' equity		54,719			51,805			5.6	%		54,343			51,388			5.8	%

										As of
	As of June 30,									Dec. 31
END OF PERIOD BALANCES	2006			2005			% Change			2005			% Change
Loans	$	287,536		$	247,503			16.2	%	$	276,780			3.9	%
Reserve for loan losses		3,759			3,253			15.6	%		3,477			8.1	%
Total earning assets		415,783			390,336			6.5	%		410,897			1.2	%
Intangible assets		6,503			7,325			-11.2	%		6,913			-5.9	%
Total assets		461,219			425,335			8.4	%		450,848			2.3	%
Deposits		389,176			364,871			6.7	%		377,900			3.0	%
Borrowed funds		10,220			3,890			n/m			15,275			-33.1	%
Shareholders' equity		55,253			52,400			5.4	%		53,456			3.4	%
ASSET QUALITY (END OF PERIOD)
Loans 90 days past due and still accruing	$	469		$	386					$	549
Nonaccrual Loans		1,032			177						232
Other Real Estate Owned		25			255						330
Total nonperforming assets		1,526			818						1,111
Nonperforming assets / total assets		0.33	%		0.19	%					0.25	%
Allowance for loan losses / total loans		1.31	%		1.31	%					1.26	%
(1) All ratios are annualized.
n/m - percentage change is not meaningful.