Susquehanna Bancshares (SUSQ) 8-K Susquehanna Bancshares, Inc. Announces Third Quarter 2010 Results

Exhibit 99.1

Susquehanna Bancshares, Inc. Announces Third Quarter 2010 Results

LITITZ, Pa.--(BUSINESS WIRE)--October 27, 2010--Susquehanna Bancshares, Inc. (Susquehanna) (NASDAQ: SUSQ) today announced net income applicable to common shareholders for the third quarter ended September 30, 2010 was $4.6 million, or $0.04 per diluted share, compared to $2.7 million for the third quarter of 2009, or $0.03 per diluted share. Net income for the first nine months of 2010 was $6.5 million, or $0.06 per diluted share, compared to net loss of ($7.4) million or ($0.09) per share for the first nine months of 2009.

Third Quarter Financial Results:

• Net loans and leases decreased 2% to $9.7 billion from September 30, 2009.
  • Consumer loans increased 30% from September 30, 2009.
  • Real estate secured-residential loans increased 13% from September 30, 2009.
  • Real estate secured-commercial loans were flat compared to September 30, 2009.
  • Real estate – construction loans decreased 24% from September 30, 2009.
  • Commercial loans decreased 13% compared to September 30, 2009.
  • Leases decreased 8% from September 30, 2009.
• Total deposits increased 3% to $9.2 billion from September 30, 2009.
  • Interest-bearing demand deposits increased 19% from September 30, 2009.
  • Non-interest-bearing demand deposits increased 12% from September 30, 2009.
  • Savings deposits increased 5% from September 30, 2009.
  • Time deposits decreased 11% from September 30, 2009.
• Net interest margin for the quarter decreased 6 basis points to 3.58% compared to 3.64% for the third quarter of 2009.
• Net charge-offs as a percentage of average loans and leases for the third quarter of 2010 were 1.42% compared to 1.48% for the third quarter of 2009. Non-performing assets as a percentage of loans, leases and other real estate owned were 2.53% at September 30, 2010 compared to 2.51% at September 30, 2009.

• Common equity was $2.0 billion, or $15.42 per common share, at September 30, 2010 compared to $1.7 billion, or $19.53 per common share, at September 30, 2009.
• Susquehanna’s regulatory capital ratios are as follows:

	At September 30, 2010	Well-Capitalized Threshold
Tangible Common Ratio(1)	7.64%	N/A
Tier 1 Common Ratio	9.52%	N/A
Leverage Ratio	11.08%	5.0 %
Tier 1 Capital Ratio	13.54%	6.0 %
Total Risk-Based Capital Ratio	15.76%	10.0 %

• Return on average assets and average tangible equity⁽²⁾ for the third quarter ended September 30, 2010 finished at 0.17% and 2.87%, respectively. This compared to results of 0.20% and 3.76% for the same measurements, respectively, for the third quarter of 2009.

⁽¹⁾ Includes deferred tax liability associated with intangibles of $43.1 million.

⁽²⁾A non-GAAP-based financial measure. The most comparable GAAP-based measurement for return on average tangible equity is return on average equity. A reconciliation of the differences between non-GAAP-based and GAAP-based measurements can be found at the end of this release under the heading "Supplemental Reporting of Non-GAAP-Based Financial Measures."

Linked Quarter Results (Third Quarter 2010 vs. Second Quarter 2010)

• Net loans and leases decreased 1% from June 30, 2010.
  • Consumer loans increased 5% from June 30, 2010.
  • Real estate secured – residential loans increased 1% from June 30, 2010.
  • Real estate construction loans decreased 3% from June 30, 2010.
  • Commercial loans decreased 3% from June 30, 2010.
  • Leases decreased 3% from June 30, 2010.
  • Real estate secured – commercial loans decreased 1% from June 30, 2010.

• Total deposits remained flat at $9.2 billion from June 30, 2010.
  • Non-interest bearing demand deposits increased 3% from June 30, 2010.
  • Interest-bearing demand deposits increased 1% from June 30, 2010.
  • Savings deposits decreased 3% from June 30, 2010.
  • Time deposits decreased 1% from June 30, 2010.
• Net interest margin decreased 11 basis points to 3.58% compared to the second quarter of 2010.

• Net charge-offs as a percentage of average loans and leases decreased 4 basis points to 1.42% compared to the second quarter of 2010. Non-performing assets as a percentage of loans, leases and other real estate owned decreased 7 basis points to 2.53% at September 30, 2010.

“With the pace of economic recovery now stalled, loan demand has been weak. Core deposits are up compared to last year, as well as from the second to third quarter,” said William J. Reuter, Chairman and Chief Executive Officer of Susquehanna Bancshares, Inc. “We do see some positive trends in credit quality, as net charge-offs, non-performing loans, and our provision for loan losses all decreased from the second to third quarter. This builds on the improvement we saw in the previous quarter, and we are cautiously optimistic that this signals increasing economic stability for our customers and the communities we serve.”

Susquehanna will broadcast its third quarter 2010 results conference call over the Internet on October 28, 2010 at 11:00 a.m. Eastern time. The conference call will include management’s discussion of third quarter 2010 results. The discussion may also include forward-looking information and financial goals. Investors will have the opportunity to listen to the conference call through a live broadcast on Susquehanna’s Web site. The event may be accessed by selecting "Investor Relations" near the top right of the home page then “Overview” and clicking on the third quarter webcast link. To listen to the live call, please go to the Web site at least fifteen minutes prior to the scheduled start time to download and install any necessary audio software. For those who are unable to listen to the live broadcast, an archived replay and podcast will be available on the Web site shortly after the call concludes.

Susquehanna Bancshares, Inc. is a financial services holding company with assets of approximately $14 billion. Headquartered in Lititz, Pa., the company provides banking and financial services at more than 220 branch locations in the mid-Atlantic region. Through Susquehanna Wealth Management, the company offers investment, fiduciary, brokerage, insurance, retirement planning, and private banking services, with approximately $6 billion in assets under management and administration. Susquehanna also operates an insurance brokerage and employee benefits company, a commercial finance company and a vehicle leasing company. Investor information may be requested on Susquehanna’s Web site at www.susquehanna.net.

This press release contains certain financial information determined by methods other than in accordance with GAAP. Susquehanna’s management uses these non-GAAP measures in its analysis of the company’s performance. These non-GAAP financial measures require management to make judgments about the exclusion of certain items, and if different judgments were made, the amounts reported would be different. These measures typically exclude the effects of intangibles and related amortization and include the tax benefit associated with revenue items that are tax-exempt. Disclosures regarding these non-GAAP financial measures are included in the accompanying financial information.

The presentation of these non-GAAP financial measures is intended to supplement investors’ understanding of Susquehanna’s core business activities. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies.

This release includes forward-looking statements as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995. In particular, this release includes forward-looking statement regarding Susquehanna's credit quality and general economic conditions. These statements are subject to certain risks and uncertainties including risks relating to Susquehanna's ability to monitor its existing loan portfolio, to find qualified borrowers, as well as risks relating to changes in consumer confidence, changes in the general economic climate, unforeseen action taken by regulators and the other risks set forth in Susquehanna's filings with the Securities and Exchange Commission. Susquehanna encourages readers of this release to understand forward-looking statements to be strategic objectives rather than absolute targets of future performance. Forward-looking statements speak only as of the date they are made. Susquehanna does not intend to update publicly any forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made or to reflect the occurrence of unanticipated events except as required by law.

Susquehanna Bancshares, Inc.
P.O. Box 1000
Lititz, PA 17543
SUMMARY FINANCIAL INFORMATION
(Dollars in thousands, except per common share data)
					Nine Months
	3Q10		3Q09		2010		2009
Balance Sheet (EOP)
Investments	$2,372,066		$1,822,895		$2,372,066		$1,822,895
Loans and leases	9,696,800		9,863,705		9,696,800		9,863,705
Allowance for loan & lease losses (ALLL)	191,115		168,570		191,115		168,570
Total assets	14,026,620		13,659,154		14,026,620		13,659,154
Deposits	9,202,178		8,900,313		9,202,178		8,900,313
Short-term borrowings	584,023		1,020,614		584,023		1,020,614
Federal Home Loan Bank borrowings	1,117,116		1,049,383		1,117,116		1,049,383
Other long-term debt	714,741		448,246		714,741		448,246
Shareholders' equity	2,099,663		1,979,082		2,099,663		1,979,082
Stated book value per common share	15.42		19.53		15.42		19.53
Tangible book value per common share	7.30		7.21		7.30		7.21
Average Balance Sheet
Investments	$2,229,299		$1,813,956		$1,995,250		$1,875,064
Loans and leases	9,721,291		9,871,042		9,864,094		9,790,294
Total earning assets	12,070,477		11,790,107		11,958,415		11,776,540
Total assets	13,980,383		13,703,828		13,871,263		13,697,767
Deposits	9,203,961		8,935,255		9,162,735		9,050,320
Other short-term borrowings	589,528		1,050,060		635,833		939,446
FHLB borrowings	1,117,387		1,049,652		1,039,671		1,052,286
Other long-term debt	718,762		448,280		713,411		448,223
Shareholders' equity	2,092,332		1,964,460		2,085,839		1,952,405
Income Statement
Net interest income	$105,411		$104,802		$319,933		$300,176
Provision for loan and lease losses	40,000		48,000		128,000		133,000
Noninterest income	35,407		40,705		112,360		117,722
Noninterest expense	96,212		91,535		286,679		289,518
Income (loss) before taxes	4,606		5,972		17,614		(4,620	)
Benefit from income taxes	(1,374	)	(850	)	(1,260	)	(9,690	)
Net income	5,980		6,822		18,874		5,070
Net income (loss) applicable to common shareholders	4,584		2,657		6,536		(7,424	)
Basic earnings per common share	0.04		0.03		0.06		(0.09	)
Diluted earnings per common share	0.04		0.03		0.06		(0.09	)
Cash dividends paid per common share	0.01		0.05		0.03		0.36
Asset Quality
Net charge-offs (NCOs)	$34,680		$36,947		$109,253		$78,179
Nonaccrual loans & leases	$227,418		$225,343		$227,418		$225,343
OREO	18,856		22,510		18,856		22,510
Total nonperforming assets (NPAs)	$246,274		$247,853		$246,274		$247,853
Restructured loans	$119,398		$32,188		$119,398		$32,188
Loans & leases 90 days past due	18,005		38,396		18,005		38,396
Susquehanna Bancshares, Inc.
P.O. Box 1000
Lititz, PA 17543
RATIO ANALYSIS	3Q10		3Q09		2010		2009
Credit Quality
NCOs / Average loans & leases	1.42	%	1.48	%	1.48	%	1.07	%
NPAs / Loans & leases & OREO	2.53	%	2.51	%	2.53	%	2.51	%
ALLL / Nonaccrual loans & leases	84.04	%	74.81	%	84.04	%	74.81	%
ALLL / Total loans & leases	1.97	%	1.71	%	1.97	%	1.71	%
Capital Adequacy
Equity / Assets	14.97	%	14.49	%	14.97	%	14.49	%
Long-term debt / Equity	34.04	%	22.65	%	34.04	%	22.65	%
Profitability
Return on average assets	0.17	%	0.20	%	0.18	%	0.05	%
Return on average equity	1.13	%	1.38	%	1.21	%	0.35	%
Return on average tangible equity (1)	2.87	%	3.76	%	3.05	%	1.55	%
Net interest margin	3.58	%	3.64	%	3.69	%	3.52	%
Efficiency ratio	66.68	%	61.48	%	64.80	%	67.67	%

(1)Supplemental Reporting of Non-GAAP-based Financial Measures-Return on average tangible equity

Return on average tangible equity is a non-GAAP-based financial measure calculated using non-GAAP-based amounts. The most directly comparable measure is return on average equity which is calculated using GAAP-based amounts. We calculate return on average tangible equity by excluding the balance of intangible assets and their related amortization expense from our calculation of return on average equity. Management uses the return on average tangible equity in order to review our core operating results. Management believes that this is a better measure of our performance. In addition, this is consistent with the treatment by bank regulatory agencies, which excludes goodwill and other intangible assets from the calculation of risk-based capital ratios. A reconciliation of return on average equity to return on average tangible equity is set forth below.

	3Q10		3Q09		2010		2009
Return on average equity (GAAP basis)	1.13	%	1.38	%	1.21	%	0.35	%
Effect of excluding average intangible assets and related amortization	1.74	%	2.38	%	1.84	%	1.20	%
Return on average tangible equity	2.87	%	3.76	%	3.05	%	1.55	%

Susquehanna Bancshares, Inc.
P.O. Box 1000
Lititz, PA 17543
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
	September 30, 2010		December 31, 2009		September 30, 2009
	(in thousands, except share data)
Assets
Cash and due from banks	$201,353		$203,240		$199,626
Unrestricted short-term investments	66,497		87,966		100,099
Cash and cash equivalents	267,850		291,206		299,725
Interest-bearing deposits held by consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities	5,875		0		0
Restricted short-term investments	60,835		154		50
Securities available for sale	2,363,331		1,866,346		1,813,910
Securities held to maturity (fair values approximate $8,735, $8,921, and $8,985)	8,735		8,921		8,985
Loans and leases, net of unearned income	9,472,511		9,827,279		9,863,705
Loans held by consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities	224,289		0		0
Less: Allowance for loan and lease losses	191,115		172,368		168,570
Net loans and leases	9,505,685		9,654,911		9,695,135
Premises and equipment, net	163,205		165,529		165,764
Foreclosed assets (OREO)	18,856		24,292		22,510
Accrued income receivable	37,942		36,127		38,028
Bank-owned life insurance	353,036		355,373		357,325
Goodwill	1,018,031		1,018,031		1,018,031
Intangible assets with finite lives	36,424		43,513		46,116
Other assets	186,815		224,859		193,575
Total assets	$14,026,620		$13,689,262		$13,659,154
Liabilities and Shareholders' Equity
Deposits:
Demand	$1,362,116		$1,261,208		$1,210,770
Interest-bearing demand	3,527,064		3,262,812		2,962,307
Savings	758,672		743,687		724,487
Time	2,285,754		2,540,805		2,747,706
Time of $100 or more	1,268,572		1,165,851		1,255,043
Total deposits	9,202,178		8,974,363		8,900,313
Federal Home Loan Bank short-term borrowings	300,000		100,000		0
Other short-term borrowings	584,023		1,040,703		1,020,614
Federal Home Loan Bank long-term borrowings	817,116		923,817		1,049,383
Other long-term debt	176,040		176,050		176,055
Junior subordinated debentures	322,742		272,324		272,191
Long-term debt of consolidated variable interest entities for which creditors do not have recourse to Susquehanna's general credit	215,959		0		0
Accrued interest, taxes, and expenses payable	57,099		47,688		71,708
Deferred taxes	38,329		87,981		74,391
Other liabilities	213,471		85,255		115,417
Total liabilities	11,926,957		11,708,181		11,680,072
Shareholders' equity:
Preferred stock, $1,000 liquidation value, 5,000,000 shares authorized. Issued: 100,000 at September 30, 2010; 300,000 at December 31, 2009 and September 30, 2009	97,891		292,359		291,944
Common stock, $2.00 par value, 200,000,000 shares authorized; Issued: 129,794,795 at September 30, 2010; 86,473,612 at December 31, 2009; and 86,394,320 at September 30, 2009	259,590		172,947		172,789
Additional paid-in capital	1,300,102		1,057,305		1,056,800
Retained earnings	474,161		478,167		475,591
Accumulated other comprehensive loss, net of taxes of $17,983; $10,606; and $9,715, respectively	(32,081	)	(19,697	)	(18,042	)
Total shareholders' equity	2,099,663		1,981,081		1,979,082
Total liabilities and shareholders' equity	$14,026,620		$13,689,262		$13,659,154

Susquehanna Bancshares, Inc.
P.O. Box 1000
Lititz, PA 17543
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2010		2009		2010		2009
	(in thousands, except per share data)
Interest Income:
Loans and leases, including fees	$134,047		$139,591		$406,529		$415,341
Securities:
Taxable	13,468		16,758		40,955		54,329
Tax-exempt	3,891		3,755		10,951		11,174
Dividends	1,027		992		2,964		2,943
Short-term investments	56		54		129		529
Total interest income	152,489		161,150		461,528		484,316
Interest Expense:
Deposits:
Interest-bearing demand and savings	5,785		4,790		17,475		18,502
Time	19,196		33,166		62,990		109,103
Federal Home Loan Bank short-term borrowings	711		0		749		0
Other short-term borrowings	982		1,098		2,277		3,233
Federal Home LoanBank long-term borrowings	11,148		10,122		31,844		30,275
Other long-term debt	9,256		7,172		26,260		23,027
Total interest expense	47,078		56,348		141,595		184,140
Net interest income	105,411		104,802		319,933		300,176
Provision for loan and lease losses	40,000		48,000		128,000		133,000
Net interest income, after provision for loan and lease losses	65,411		56,802		191,933		167,176
Noninterest Income:
Service charges on deposit accounts	8,923		9,326		25,878		28,277
Vehicle origination and servicing fees	1,717		1,210		5,202		4,996
Asset management fees	6,653		6,733		21,279		18,920
Income from fiduciary-related activities	1,784		1,803		5,375		5,270
Commissions on brokerage, life insurance and annuity sales	1,866		2,291		5,527		5,850
Commissions on property and casualty insurance sales	2,589		2,661		8,871		9,446
Income from bank-owned life insurance	1,218		1,312		3,849		4,094
Net gain on sale of loans and leases	2,580		3,142		7,312		8,141
Net realized gain on sales of securities	393		4,727		11,285		5,079
Total other-than-temporary impairment (losses) gains	119		0		(4,004	)	(937	)
Portion of loss (gain) recognized in other comprehensive income (before taxes)	(441	)	0		945		0
Net impairment losses recognized in earnings	(322	)	0		(3,059	)	(937	)
Other	8,006		7,500		20,841		28,586
Total noninterest income	35,407		40,705		112,360		117,722
Noninterest Expenses:
Salaries and employee benefits	48,850		47,771		146,243		144,849
Occupancy	8,610		7,633		26,961		26,696
Furniture and equipment	3,335		3,620		10,422		10,962
Advertising and marketing	2,980		1,802		8,875		6,392
FDIC insurance	4,500		4,245		13,284		20,236
Amortization of intangible assets	2,346		2,624		7,089		7,928
Vehicle lease disposal	3,923		3,858		11,095		10,384
Other	21,668		19,982		62,710		62,071
Total noninterest expenses	96,212		91,535		286,679		289,518
Income (loss) before income taxes	4,606		5,972		17,614		(4,620	)
Benefit from income taxes	(1,374	)	(850	)	(1,260	)	(9,690	)
Net Income	5,980		6,822		18,874		5,070
Preferred stock dividends and accretion	1,396		4,165		12,338		12,494
Net Income (Loss) Applicable to Common Shareholders	$4,584		$2,657		$6,536		($7,424	)
Earnings per common share:
Basic	$0.04		$0.03		$0.06		($0.09	)
Diluted	$0.04		$0.03		$0.06		($0.09	)
Cash dividends per common share	$0.01		$0.05		$0.03		$0.36
Average common shares outstanding:
Basic	129,687		86,294		118,103		86,220
Diluted	129,718		86,294		118,135		86,220

Susquehanna Bancshares, Inc.
P.O. Box 1000
Lititz, PA 17543
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY
Interest rates and interest differential-taxable equivalent basis
	For the Three-month Period Ended				For the Three-month Period Ended
	September 30, 2010				September 30, 2009
	Average				Average
(Dollars in thousands)	Balance		Interest	Rate (%)	Balance		Interest	Rate (%)
Assets
Short-term investments	$119,887		$56	0.19	$105,109		$54	0.20
Investment securities:
Taxable	1,847,854		14,494	3.11	1,463,580		17,750	4.81
Tax-advantaged	381,445		5,986	6.23	350,376		5,775	6.54
Total investment securities	2,229,299		20,480	3.64	1,813,956		23,525	5.15
Loans and leases, (net):
Taxable	9,468,492		131,479	5.51	9,649,279		137,085	5.64
Tax-advantaged	252,799		3,951	6.20	221,763		3,855	6.90
Total loans and leases	9,721,291		135,430	5.53	9,871,042		140,940	5.66
Total interest-earning assets	12,070,477		155,966	5.13	11,790,107		164,519	5.54
Allowance for loan and lease losses	(190,022	)			(163,409	)
Other non-earning assets	2,099,928				2,077,130
Total assets	$13,980,383				$13,703,828
Liabilities
Deposits:
Interest-bearing demand	$3,486,885		5,492	0.62	$2,878,901		4,499	0.62
Savings	769,946		293	0.15	738,392		291	0.16
Time	3,606,545		19,196	2.11	4,083,021		33,166	3.22
Short-term borrowings	589,528		982	0.66	1,050,060		1,098	0.41
FHLB borrowings	1,117,387		11,859	4.21	1,049,652		10,122	3.83
Long-term debt	718,762		9,256	5.11	448,280		7,172	6.35
Total interest-bearing liabilities	10,289,053		47,078	1.82	10,248,306		56,348	2.18
Demand deposits	1,340,585				1,234,941
Other liabilities	258,413				256,121
Total liabilities	11,888,051				11,739,368
Equity	2,092,332				1,964,460
Total liabilities & shareholders' equity	$13,980,383				$13,703,828
Net interest income / yield on average earning assets			$108,888	3.58			$108,171	3.64

1.	Average loan balances include non accrual loans.
2.	Tax-exempt income has been adjusted to a tax-equivalent basis using a marginal tax rate of 35%.
3.	For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.

Susquehanna Bancshares, Inc.
P.O. Box 1000
Lititz, PA 17543
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY
Interest rates and interest differential-taxable equivalent basis
	For the Nine-month Period Ended				For the Nine-month Period Ended
	September 30, 2010				September 30, 2009
	Average				Average
(Dollars in thousands)	Balance		Interest	Rate (%)	Balance		Interest	Rate (%)
Assets
Short-term investments	$99,071		$129	0.17	$111,182		$529	0.64
Investment securities:
Taxable	1,643,525		43,919	3.57	1,528,135		57,271	5.01
Tax-advantaged	351,725		16,848	6.40	346,929		17,193	6.63
Total investment securities	1,995,250		60,767	4.07	1,875,064		74,464	5.31
Loans and leases, (net):
Taxable	9,606,701		398,707	5.55	9,569,595		408,064	5.70
Tax-advantaged	257,393		12,034	6.25	220,699		11,195	6.78
Total loans and leases	9,864,094		410,741	5.57	9,790,294		419,259	5.73
Total interest-earning assets	11,958,415		471,637	5.27	11,776,540		494,252	5.61
Allowance for loan and lease losses	(182,688	)			(138,218	)
Other non-earning assets	2,095,536				2,059,445
Total assets	$13,871,263				$13,697,767
Liabilities
Deposits:
Interest-bearing demand	$3,428,980		16,595	0.65	$2,793,759		17,102	0.82
Savings	766,487		880	0.15	729,966		1,400	0.26
Time	3,681,513		62,990	2.29	4,309,384		109,103	3.38
Short-term borrowings	635,833		2,277	0.48	939,446		3,233	0.46
FHLB borrowings	1,039,671		32,593	4.19	1,052,286		30,275	3.85
Long-term debt	713,411		26,260	4.92	448,223		23,027	6.87
Total interest-bearing liabilities	10,265,895		141,595	1.84	10,273,064		184,140	2.40
Demand deposits	1,285,755				1,217,211
Other liabilities	233,774				255,087
Total liabilities	11,785,424				11,745,362
Equity	2,085,839				1,952,405
Total liabilities & shareholders' equity	$13,871,263				$13,697,767
Net interest income / yield on average earning assets			$330,042	3.69			$310,112	3.52

1.	Average loan balances include non accrual loans.
2.	Tax-exempt income has been adjusted to a tax-equivalent basis using a marginal tax rate of 35%.
3.	For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.

Susquehanna Bancshares, Inc.
Loans and Leases
(Dollars in thousands)
	Total Loans and Leases
	09/30/10				12/31/09				09/30/09
Commercial, financial, and agricultural	$	1,829,217			$	2,050,110			$	2,096,869
Real estate - construction		914,761				1,114,709				1,208,706
Real estate secured - residential		2,664,042				2,369,380				2,350,192
Real estate secured - commercial		3,021,525				3,060,331				3,016,452
Consumer		576,912				482,266				443,417
Leases		690,343				750,483				748,069
Total loans and leases	$	9,696,800			$	9,827,279			$	9,863,705
	Nonaccrual Loans and Leases
	09/30/10		06/30/10		03/31/10		12/31/09		09/30/09
Commercial, financial, and agricultural	$	22,522	$	24,917	$	23,009	$	20,282	$	18,064
Real estate - construction		76,418		89,476		97,234		97,717		102,667
Real estate secured - residential		47,564		48,213		52,749		37,254		35,752
Real estate secured - commercial		77,858		70,785		70,635		59,181		60,387
Consumer		2		4		24		27		32
Leases		3,054		3,983		4,012		5,093		8,441
Total nonaccrual loans and leases	$	227,418	$	237,378	$	247,663	$	219,554	$	225,343
	Restructured Loans
	09/30/10		06/30/10		03/31/10		12/31/09		09/30/09
Commercial, financial, and agricultural	$	14,796	$	15,391	$	15,042	$	8,512	$	3,455
Real estate - construction		4,847		4,149		3,792		2,900		0
Real estate secured - residential		20,236		7,625		5,419		203		203
Real estate secured - commercial		78,692		51,823		30,785		46,629		28,530
Consumer		827		607		0		0		0
Total restructured loans	$	119,398	$	79,595	$	55,038	$	58,244	$	32,188
	Net Charge-offs
	3Q 2010		2Q 2010		1Q 2010		4Q 2009		3Q 2009
Commercial, financial, and agricultural	$	4,298	$	7,701	$	3,792	$	11,210	$	7,940
Real estate - construction		15,017		11,798		11,313		22,893		21,319
Real estate secured - residential		3,117		3,062		5,983		2,294		1,816
Real estate secured - commercial		10,149		10,531		14,530		8,691		3,870
Consumer		451		771		622		842		401
Leases		1,648		2,161		2,309		5,272		1,601
Total net charge-offs	$	34,680	$	36,024	$	38,549	$	51,202	$	36,947

CONTACT:
Susquehanna Bancshares, Inc.
Abram G. Koser, Vice President, Investor Relations
717-625-6305
ir@susquehanna.net