First Guaranty Bancshares (FGBI) 8-K Results of Operations and Financial Condition

Exhibit 99.1

A Message to Our Stockholders

	June 30, 2010			June 30, 2009
Net Income (Bank)	$	6,162,000		$	2,139,000
Income Available to Common Shareholder (Bancshares)	$	5,296,000		$	1,956,000
Earnings Per Common Share	$	0.95		$	0.35
Allowance for Loan Losses	$	8,625,000		$	6,701,000
Common Stock Equity	$	79,299,000		$	66,128,000
Book Value	$	14.42		$	12.18
Return on Average Assets		1.24	%		0.41	%
Return on Average Common Equity		16.80	%		5.90	%

Dear Shareholders:

First Guaranty Bank’s goal is to increase shareholder value while at the same time providing returns to our shareholders through dividends. We will achieve this goal by maximizing net income, providing dividends of approximately 41% of the net earnings, and retaining the remaining 59% of the net earnings as a contribution to capital. In the first half 2010, First Guaranty Bancshares has produced $5,962,000 in income, paid approximately $1,780,000 in dividends to common shareholders and $666,000 in dividends to preferred shareholders, and retained the balance to enhance equity.

As the capsule of financial information above shows, First Guaranty Bank and First Guaranty Bancshares, Inc. have experienced a very successful first half of 2010 compared to the first half of 2009. Income continued to grow and strengthen from interest income on securities, gains on securities, and operations.

Assets exceeded $1 billion largely as a result of the growth of core deposits from $518 million in January 2010 to $577 million as of June 30, 2010.

First Guaranty Bank is gaining momentum. Our entire team is working to solidify and expand our relationships with our existing customers and to build new relationships with new customers. First Guaranty Bank is dedicated to being “The Relationship Bank.” As our customers are coming to know, at First Guaranty Bank, “We Rock!”

Thank you for your investment in First Guaranty Bancshares, Inc. and for your continued support. If you have any questions about our financial position or any of the information presented in this report, please contact me directly at (985) 375-0350.

Sincerely,

/s/ Alton B. Lewis

Alton B. Lewis

Chief Executive Officer

First Guaranty Bancshares, Inc.

Consolidated

Statements of Condition

(in thousands, except share data)

	June 30,
	2010			2009
	(unaudited)
Assets
Cash and cash equivalents:
Cash and due from banks	$	34,354		$	29,256
Interest-earning demand deposits with banks		41			26,782
Federal funds sold		1,004			-
Cash and cash equivalents		35,399			56,038
Interest-earning time deposits with banks		-			13,613
Investment securities:
Available for sale, at fair value		339,867			252,638
Held to maturity, at cost (estimated fair value of 0 and $2,837, respectively)		-			2,792
Investment securities		339,867			255,430
Federal Home Loan Bank stock, at cost		1,840			947
Loans held for sale		39			147
Loans, net of unearned income		622,607			606,487
Less: allowance for loan losses		8,625			6,701
Net loans		613,982			599,786
Premises and equipment, net		17,082			15,951
Goodwill		1,999			1,980
Intangible assets, net		1,828			2,006
Other real estate, net		1,607			1,049
Accrued interest receivable		5,984			5,304
Other assets		6,547			5,971
Total Assets	$	1,026,174		$	958,222
Liabilities and Stockholders’ Equity
Deposits:
Noninterest-bearing demand	$	122,888		$	114,262
Interest-bearing demand		195,486			203,605
Savings		44,029			42,233
Time		522,550			492,276
Total deposits		884,953			852,376
Short-term borrowings		21,137			26,193
Accrued interest payable		2,855			4,689
Long-term borrowings		15,011			3,368
Other liabilities		2,047			5,468
Total Liabilities		926,003			892,094
Stockholders’ Equity
Preferred stock:
Series A - $1,000 par value - authorized 5,000 shares; issued and outstanding 2,069.9 shares		19,743			-
Series B - $1,000 par value - authorized 5,000 shares; issued and outstanding 103 shares		1,129			-
Common stock:
$1 par value - authorized 100,600,000 shares; issued and outstanding 5,559,644 shares		5,560			5,560
Surplus		26,459			26,459
Retained earnings		43,587			36,803
Accumulated other comprehensive loss		(3,693	)		(2,694	)
Total Stockholders’ Equity		100,171			66,128
Total Liabilities and Stockholders’ Equity	$	1,026,174		$	958,222

Consolidated

Statements of Income

(in thousands, except share, per share data and percentages)

	For the Three-Month Period Ended June 30,
	2010			2009
	(unaudited)
Interest Income:
Loans (including fees)	$	9,184		$	8,873
Loans held for sale		3			2
Deposits with other banks		10			84
Securities (including FHLB stock)		3,525			2,468
Federal funds sold		3			10
Total Interest Income		12,725			11,437
Interest Expense:
Demand deposits		229			284
Savings deposits		11			36
Time deposits		2,811			3,503
Borrowings		29			98
Total Interest Expense		3,080			3,921
Net Interest Income		9,645			7,516
Provision for loan losses		623			701
Net Interest Income after Provision for Loan Losses		9,022			6,815
Noninterest Income:
Service charges, commissions and fees		1,015			1,040
Net gains on sale of securities		1,105			10
Loss on securities impairment					-
Net gains on sale of loans		92			192
Other		367			243
Total Noninterest Income		2,579			1,485
Noninterest Expense:
Salaries and employee benefits		2,946			2,667
Occupancy and equipment expense		756			728
Net cost from other real estate & repossessions		100			201
Regulatory assessment		390			935
Other		2,254			2,417
Total Noninterest Expense		6,446			6,948
Income Before Income Taxes		5,155			1,352
Provision for income taxes		1,776			469
Net Income	$	3,379		$	883
Preferred stock Dividends		(333	)		0
Income Available to Common Shareholders	$	3,046		$	883
Per Common Share:
Earnings	$	0.49		$	0.16
Cash dividends paid	$	0.16		$	0.16
Weighted Average Common Shares Outstanding		5,559,644			5,559,644
Return on Average Assets		1.39	%		0.37	%
Return on Average Equity		19.20	%		5.40	%

Consolidated

Statements of Income

(in thousands, except share, per share data and percentages)

	For the Six-Month Period Ended June 30,
	2010			2009
	(unaudited)
Interest Income:
Loans (including fees)	$	17,988		$	17,530
Loans held for sale		4			3
Deposits with other banks		19			309
Securities (including FHLB stock)		6,944			4,542
Federal funds sold		5			27
Total Interest Income		24,960			22,411
Interest Expense:
Demand deposits		430			604
Savings deposits		21			77
Time deposits		5,529			7,095
Borrowings		70			159
Total Interest Expense		6,050			7,935
Net Interest Income		18,910			14,476
Provision for loan losses		1,302			1,349
Net Interest Income after Provision for Loan Losses		17,608			13,127
Noninterest Income:
Service charges, commissions and fees		1,998			2,020
Net gains on sale of securities		1,366			10
Loss on securities impairment		-			-
Net gains on sale of loans		151			272
Other		706			520
Total Noninterest Income		4,221			2,822
Noninterest Expense:
Salaries and employee benefits		5,844			5,493
Occupancy and equipment expense		1,508			1,411
Net cost from other real estate & repossessions		164			180
Regulatory assessment		746			1,307
Other		4,440			4,563
Total Noninterest Expense		12,702			12,954
Income Before Income Taxes		9,127			2,995
Provision for income taxes		3,165			1,039
Net Income	$	5,962		$	1,956
Preferred stock Dividends		(666	)		0
Income Available to Common Shareholders	$	5,296		$	1,956
Per Common Share:
Earnings	$	0.95		$	0.35
Cash dividends paid	$	0.32		$	0.32
Weighted Average Common Shares Outstanding		5,559,644			5,559,644
Return on Average Assets		1.24	%		0.41	%
Return on Average Equity		16.80	%		5.90	%
Book Value	$	14.42		$	12.18

Bank Officers

Executive Officers	Assistant Vice Presidents
Alton B. Lewis, Jr.*	Teri L. Duncan
Chief Executive Officer
Guaranty Square	Pamela A. Gaspard
Michael R. Sharp*	Joyce N. Glass
President
Guaranty Square	Ludrick P. Hidalgo
Larry A. Stark	Mikki M. Kelley
Executive Vice President
Guaranty Square	Robert M. Mizell
Eric J. Dosch*	Ronald C. Pittman
Chief Financial Officer
Guaranty Square	Christy L. Wells
Senior Vice Presidents	Deborah B. Westmoreland
Glenn A. Duhon, Sr.
Southwest Louisiana Division	Officers
Manager	Edward P. Bertoniere
Abbeville
	Pamela A. Carrico
Michael F. Lofaso
Commercial Lender	Frances L. Carrington
Ponchatoula
	Vanessa R. Drew
Vice Presidents
Mark A. Bagwell	Jake I. Duos
Thomas F. Brothers	Jeannette N. Ernst
Cheryl Q. Brumfield	Danielle D. Fridge
Christopher O. Coker	Shirley P. Jones
Ronald W. Edmonds	Julie M. Lewis
Denise D. Fletcher	Frances M. Mashon
Bernadette Z. Kemp	Tiffany C. Moore
Stephen F. Lampton	Michael A. Mosbey
Vera S. Matthews	Diane Patterson
William D. McCormick, Sr.	Randy S. Vicknair
Evan M. Singer	Scott B. Schilling
J. Richard Stark	Lisa B. Thompson
Renee S. Young	Jeffery C. Wainwright
	Amy N. Wales

*Officers of First Guaranty Bancshares, Inc. and First Guaranty Bank.

Banking Center Locations

Full-Service Banking Centers	Service24 ATM Locations
South Louisiana	South Louisiana
Abbeville Banking Center	Abbeville
Amite Banking Center	799 West Summers Drive
Denham Springs	Amite
Banking Center	100 East Oak Street
Hammond Banking Centers:	Denham Springs
First Guaranty Square	2231 South Range Avenue
Guaranty West	Hammond
Independence Banking Center	1201 West University Avenue
Jennings Banking Center	14145 West University Avenue
Kentwood Banking Center	2111 West Thomas Street
Ponchatoula Banking Centers:	400 East Thomas Street
Ponchatoula	North Oaks Medical Center
Berryland	North Oaks Diagnostic Center
Walker Banking Center	North Oaks Rehabilitation Center
	Independence
North Louisiana	455 West Railroad Ave.
Benton Banking Center	Jennings
Dubach Banking Center	500 North Cary
Haynesville Banking Center	Kentwood
Homer Banking Center	708 Avenue G
Oil City Banking Center	Loranger
Vivian Banking Center	19518 Hwy 40
	Ponchatoula
	105 Berryland
	170 West Hickory Street
	Robert
	22628 Highway 190
	Walker
	29815 Walker Rd. S
	North Louisiana
	Benton
	196 Burt Boulevard
	Dubach
	117 East Hico Street
	Haynesville
	10065 Highway 79
	Homer
	401 North 2nd Street
	Homer Memorial Hospital
	Oil City
	126 South Highway 1
	Vivian
	102 East Louisiana Avenue