South Financial (TSFG) 8-K Regulation FD Disclosure

Exhibit 99.1

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(dollars in thousands, except share data) (unaudited)

	Three Months Ended									% Change 9/30/05 vs.
				(Restated)			(Restated)			(Annualized)
	9/30/05			6/30/05			9/30/04			6/30/05			9/30/04
TOTAL REVENUE(1)
GAAP	$	120,017		$	152,756		$	140,350			(85.0	)%		(14.5	)%
Operating(2)		138,636			132,729			124,268			17.7			11.6
EARNINGS
GAAP earnings	$	21,090		$	42,712		$	42,571			(200.8	)%		(50.5	)%
Operating earnings		34,113			32,513			34,634			19.5			(1.5	)
Cash operating earnings		35,749			33,958			35,921			20.9			(0.5	)
DILUTED SHARE DATA
Average common shares outstanding		75,414,866			74,421,103			70,342,922			5.3	%		7.2	%
GAAP earnings	$	0.28		$	0.57		$	0.61			(201.8	)		(54.1	)
Operating earnings		0.45			0.44			0.49			9.0			(8.2	)
Cash operating earnings		0.47			0.46			0.51			8.6			(7.8	)
PERFORMANCE RATIOS (Annualized)
RETURN ON AVERAGE ASSETS:
GAAP earnings		0.56	%		1.15	%		1.29	%
Operating earnings		0.91			0.88			1.05
Cash operating earnings on average tangible assets		1.00			0.96			1.13
RETURN ON AVERAGE EQUITY:
GAAP earnings		5.55			11.81			13.22
Operating earnings		8.97			8.99			10.75
Cash operating earnings on average tangible equity		17.38			17.14			19.58
NET INTEREST MARGIN:
Tax equivalent		3.10			3.09			3.10
Excluding reclassification for interest rate swaps(5)		3.17			3.19			3.34
NONINTEREST INCOME AS A % OF TOTAL REVENUE(3):
GAAP		13.69			33.04			34.39
Operating(2)		24.13			21.88			24.97
Operating, excluding reclassification for swaps (5)		22.41			19.22			19.13
EFFICIENCY RATIOS(4):
GAAP		67.52			52.07			49.77
Operating(2)		57.31			55.17			51.66
Cash operating(2)		55.62			53.55			50.18

(1)	The sum of net interest income and noninterest income.
(2)	Total revenue, noninterest income as a % of total revenue, and the efficiency ratio, on an operating basis, are calculated using tax-equivalent net interest income and exclude non-operating items. The cash operating efficiency ratio also excludes amortization of intangibles.
(3)	Calculated as noninterest income, divided by the sum of net interest income and noninterest income.
(4)	Calculated as noninterest expenses, divided by the sum of net interest income and noninterest income.
(5)	See Appendix A, page 2 for reconciliation. Calculated excluding the net cash settlement of interest rate swaps.

Supplemental financial information may be found in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

Financial Highlights, 1

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(dollars in thousands, except share data) (unaudited)

	Nine Months Ended
				(Restated)
	9/30/05			9/30/04			% Change
TOTAL REVENUE(1)
GAAP	$	384,293		$	344,512			11.5	%
Operating(2)		399,475			330,400			20.9
EARNINGS
GAAP earnings	$	86,218		$	96,114			(10.3	)%
Operating earnings		99,293			91,149			8.9
Cash operating earnings		103,584			94,067			10.1
DILUTED SHARE DATA
Average common shares outstanding		74,294,427			64,019,889			16.0	%
GAAP earnings	$	1.16		$	1.50			(22.7	)
Operating earnings		1.34			1.42			(5.6	)
Cash operating earnings		1.39			1.47			(5.4	)
PERFORMANCE RATIOS (Annualized)
RETURN ON AVERAGE ASSETS:
GAAP earnings		0.78	%		1.10	%
Operating earnings		0.90			1.04
Cash operating earnings on average tangible assets		0.98			1.11
RETURN ON AVERAGE EQUITY:
GAAP earnings		7.94			11.78
Operating earnings		9.15			11.17
Cash operating earnings on average tangible equity		17.35			18.72
NET INTEREST MARGIN:
Tax equivalent		3.11			3.03
Excluding reclassification for interest rate swaps(5)		3.21			3.30
NONINTEREST INCOME AS A % OF TOTAL REVENUE(3):
GAAP		20.86			30.71
Operating(2)		22.79			26.80
Operating, excluding reclassification for interest rate swaps (5)		20.12			20.30
EFFICIENCY RATIOS(4):
GAAP		59.09			52.71
Operating(2)		54.99			51.68
Cash operating(2)		53.41			50.40

(1)	The sum of net interest income and noninterest income.
(2)	Total revenue, noninterest income as a % of total revenue, and the efficiency ratio, on an operating basis, are calculated using tax-equivalent net interest income and exclude non-operating items. The cash operating efficiency ratio also excludes amortization of intangibles.
(3)	Calculated as noninterest income, divided by the sum of net interest income and noninterest income.
(4)	Calculated as noninterest expenses, divided by the sum of net interest income and noninterest income.
(5)	See Appendix A, page 2 for reconciliation. Calculated excluding the net cash settlement of interest rate swaps.

Supplemental financial information may be found in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

Financial Highlights, 2

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

FINANCIAL HIGHLIGHTS

(dollars in thousands, except share data) (unaudited)

	Three Months Ended									% Change 9/30/05 vs.
				(Restated)			(Restated)			(Annualized)
	9/30/05			6/30/05			9/30/04			6/30/05			9/30/04
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
NET INCOME, AS REPORTED (GAAP)	$	21,090		$	42,712		$	42,571			(200.8	)%		(50.5	)%
Non-operating items:
Change in fair value of interest rate swaps		16,240			(22,277	)		(16,924	)
Loss (gain) on sale of available for sale securities		1,032			1,503			(678	)
(Gain) loss on equity investments		(254	)		(650	)		367
Employment contract payments		144			222			174
Merger-related costs		981			2,194			5,487
Impairment from write-down of assets		—			917			—
Loss on early extinguishment of debt		462			2,981			—
Related income taxes		(5,582	)		4,911			3,472
Discontinued operations, net of income tax		—			—			165
OPERATING EARNINGS (net income, excluding non-operating items)		34,113			32,513			34,634			19.5			(1.5	)
Add: Amortization of intangibles, net of income tax		1,636			1,445			1,287
CASH OPERATING EARNINGS (net income, excluding non-operating items and amortization of intangibles)	$	35,749		$	33,958		$	35,921			20.9			(0.5	)

	Nine Months Ended
				(Restated)
	9/30/05			9/30/04			% Change
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
NET INCOME, AS REPORTED (GAAP)	$	86,218		$	96,114			(10.3	)%
Non-operating items:
Change in fair value of interest rate swaps		11,172			(4,933	)
Loss (gain) on sale of available for sale securities		2,301			(6,499	)
Gain on equity investments		(2,615	)		(3,456	)
Gain on disposition of assets and liabilities		—			(2,350	)
Employment contract payments		329			115
Merger-related costs		3,480			6,239
Impairment (recovery) from write-down of assets		917			(277	)
Charitable contribution to foundation		683			—
Conservation grant of land		—			3,350
Loss on early extinguishment of debt		2,015			1,429
Related income taxes		(5,603	)		1,252
Discontinued operations, net of income tax		396			165
OPERATING EARNINGS (net income, excluding non-operating items)		99,293			91,149			8.9
Add: Amortization of intangibles, net of income tax		4,291			2,918
CASH OPERATING EARNINGS (net income, excluding non-operating items and amortization of intangibles)	$	103,584		$	94,067			10.1

Supplemental financial information may be found in the Investor Relations section of TSFG’s web site: www.thesouthgroup.com.

Financial Highlights, 3

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(dollars in thousands, except share data) (unaudited)

										% Change 9/30/05 vs.
				(Restated)			(Restated)			(Annualized)
	9/30/05			6/30/05			9/30/04			6/30/05			9/30/04
CREDIT QUALITY
Nonaccrual loans — commercial(1)	$	27,480		$	34,616		$	51,881						(47.0	)%
Nonaccrual loans — consumer		2,929			3,323			2,239						30.8
Nonaccrual loans — mortgage		3,299			4,518			3,594						(8.2	)
Restructured loans		—			—			—						—
Nonperforming loans		33,708			42,457			57,714						(41.6	)
Foreclosed property (other real estate owned and personal property repossessions)		11,839			12,618			8,859						33.6
Nonperforming assets		45,547			55,075			66,573						(31.6	)
Nonperforming loans as a % of loans held for investment		0.36	%		0.47	%		0.72	%
Nonperforming assets as a % of loans held for investment and foreclosed property		0.49			0.61			0.83
Allowance for loan losses as a % of loans HFI		1.16			1.18			1.21
Allowance for loan losses to nonperforming loans		3.19	x		2.49	x		1.67	x
Impaired loans(1)	$	20,674		$	28,266		$	51,881						(60.2	)
Specific allowance for impaired loans		4,238			4,956			15,001						(71.7	)
Loans past due 90 days or more (mortgage and consumer with interest accruing)		1,598			2,035			2,374						(32.7	)
Net loan charge-offs:
Three months ended		7,024			6,823			9,715						(27.7	)
Year to date		23,037			16,013			21,303
Average loans held for investment:
Three months ended		9,093,257			8,679,316			7,602,063
Year to date		8,681,649			8,472,434			6,523,832
Net loan charge-offs as a % of average loans held for investment (annualized):
Three months ended		0.31	%		0.32	%		0.51	%
Year to date		0.35			0.38			0.44
CAPITAL RATIOS
Total risk-based capital		10.42			10.68			11.20
Tier 1 risk-based capital		8.86			9.07			9.49
Leverage ratio		7.20			7.12			7.49
Tangible equity to tangible assets		5.69			5.80			5.89
SHARE DATA
Book value per common share	$	20.17		$	20.40		$	19.44			(4.5	)%		3.8	%
Tangible book value per common share		10.88			11.08			10.83			(7.2	)		0.5
Shares outstanding		74,574,907			74,348,330			70,894,247			1.2			5.2
STOCK PERFORMANCE
Market price per share of common stock	$	26.84		$	28.42		$	28.20			(22.1	)%		(4.8	)%
Indicated annual dividend		0.64			0.64			0.60			—			6.7
Dividend yield		2.38	%		2.25	%		2.13	%
Price/book ratio		1.33	xx		1.39	xx		1.45	x
Market capitalization	$	2,001,591		$	2,112,980		$	1,999,218			(20.9	)		0.1
OPERATIONS DATA
Branch offices		171			167			153			9.5	%		11.8	%
ATMs		163			159			141			10.0			15.6
Employees (full-time equivalent)		2,573			2,554			2,324			3.0			10.7
Active internet banking customers		84,717			72,173			58,934			69.0			43.7

(1) At September 30, 2005 and June 30, 2005, these credit quality indicators (nonaccrual loans — commercial and impaired loans) included $1.9 million and $5.5 million, respectively, in restructured loans.

Financial Highlights, 4

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(dollars in thousands, except share data) (unaudited)

	Three Months Ended									% Change 9/30/05 vs.
				(Restated)			(Restated)			(Annualized)
	9/30/05			6/30/05			9/30/04			6/30/05			9/30/04
INCOME STATEMENT
Interest income (tax-equivalent)	$	196,336		$	186,298		$	148,371			21.4	%		32.3	%
Interest expense		91,146			82,616			55,134			41.0			65.3
Net interest income (tax-equivalent)		105,190			103,682			93,237			5.8			12.8
Less: tax-equivalent adjustment		1,601			1,397			1,153			57.9			38.9
Net interest income		103,589			102,285			92,084			5.1			12.5
Provision for loan losses		8,853			9,944			9,440			(43.5	)		(6.2	)
Net interest income after provision for loan losses		94,736			92,341			82,644			10.3			14.6
NONINTEREST INCOME:
Customer fee income		15,112			12,751			11,736			73.5			28.8
Wealth management income		6,150			4,827			3,809			108.7			61.5
Mortgage banking income		2,087			2,140			1,514			(9.8	)		37.8
Bank-owned life insurance		2,835			2,759			2,869			10.9			(1.2	)
Merchant processing income		2,864			2,713			2,528			22.1			13.3
Gain (loss) on trading and certain derivative activities		403			(1,032	)		1,150			551.7			(65.0	)
Net cash settlement of interest rate swaps		2,377			3,534			7,259			(129.9	)		(67.3	)
Other		1,618			1,355			166			77.0			874.7
Operating noninterest income (noninterest income, excluding non-operating items)		33,446			29,047			31,031			60.1			7.8
Change in fair value of interest rate swaps		(16,240	)		22,277			16,924			n/m			n/m
(Loss) gain on sale of available for sale securities		(1,032	)		(1,503	)		678			n/m			n/m
Gain (loss) on equity investments		254			650			(367	)		n/m			n/m
Non-operating noninterest income (loss)		(17,018	)		21,424			17,235			n/m			n/m
Total noninterest income		16,428			50,471			48,266			(267.6	)		(66.0	)
NONINTEREST EXPENSES:
Personnel expense		39,879			35,681			31,984			46.7			24.7
Occupancy		7,387			6,823			5,841			32.8			26.5
Furniture and equipment		5,779			6,023			5,670			(16.1	)		1.9
Professional services		6,125			5,135			3,779			76.5			62.1
Merchant processing expense		2,327			2,211			1,984			20.8			17.3
Telecommunications		1,533			1,384			1,237			42.7			23.9
Amortization of intangibles		2,337			2,140			1,839			36.5			27.1
Other		14,081			13,824			11,863			7.4			18.7
Operating noninterest expenses (noninterest expenses, excluding non-operating items)		79,448			73,221			64,197			33.7			23.8
Employment contract payments		144			222			174			n/m			n/m
Merger-related costs		981			2,194			5,487			n/m			n/m
Impairment from write-down of assets		—			917			—			n/m			n/m
Loss on early extinguishment of debt		462			2,981			—			n/m			n/m
Non-operating noninterest expenses		1,587			6,314			5,661			n/m			n/m
Total noninterest expenses		81,035			79,535			69,858			7.5			16.0
Income before income taxes and discontinued operations		30,129			63,277			61,052			(207.8	)		(50.7	)
Income tax expense		9,039			20,565			18,316			(222.4	)		(50.6	)
Discontinued operations, net of income tax		—			—			(165	)		n/m			n/m
Net income	$	21,090		$	42,712		$	42,571			(200.8	)%		(50.5	)%
SHARE DATA:
Net income per common share, basic	$	0.28		$	0.58		$	0.62			(205.2	)%		(54.8	)%
Net income per common share, diluted		0.28			0.57			0.61			(201.8	)		(54.1	)
Cash dividends declared per common share		0.16			0.16			0.15			—			6.7
Average common shares outstanding, basic		74,272,867			73,083,009			68,635,847			6.5			8.2
Average common shares outstanding, diluted		75,414,866			74,421,103			70,342,922			5.3			7.2

Financial Highlights, 5

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(dollars in thousands, except share data) (unaudited)

	Nine Months Ended
				(Restated)
	9/30/05			9/30/04			% Change
INCOME STATEMENT
Interest income (tax-equivalent)	$	554,209		$	385,319			43.8	%
Interest expense		245,762			143,476			71.3
Net interest income (tax-equivalent)		308,447			241,843			27.5
Less: tax-equivalent adjustment		4,324			3,126			38.3
Net interest income		304,123			238,717			27.4
Provision for loan losses		29,759			24,158			23.2
Net interest income after provision for loan losses		274,364			214,559			27.9
NONINTEREST INCOME:
Customer fee income		38,786			31,828			21.9
Wealth management income		15,118			11,399			32.6
Mortgage banking income		5,714			4,694			21.7
Bank-owned life insurance		8,355			8,617			(3.0	)
Merchant processing income		7,615			6,972			9.2
Gain on trading and certain derivative activities		275			2,133			(87.1	)
Net cash settlement of interest rate swaps		10,648			21,496			(50.5	)
Other		4,517			1,418			218.5
Operating noninterest income (noninterest income, excluding non-operating items)		91,028			88,557			2.8
Change in fair value of interest rate swaps		(11,172	)		4,933			n/m
(Loss) gain on sale of available for sale securities		(2,301	)		6,499			n/m
Gain on equity investments		2,615			3,456			n/m
Gain on disposition of assets and liabilities		—			2,350			n/m
Non-operating noninterest income (loss)		(10,858	)		17,238			n/m
Total noninterest income		80,170			105,795			(24.2	)
NONINTEREST EXPENSES:
Personnel expense		109,198			84,768			28.8
Occupancy		20,309			16,098			26.2
Furniture and equipment		17,335			15,175			14.2
Professional services		15,696			10,261			53.0
Merchant processing expense		6,170			5,453			13.1
Telecommunications		4,243			3,488			21.6
Amortization of intangibles		6,283			4,229			48.6
Other		40,422			31,267			29.3
Operating noninterest expenses (noninterest expenses, excluding non-operating items)		219,656			170,739			28.7
Employment contract payments		329			115			n/m
Merger-related costs		3,480			6,239			n/m
Impairment (recovery) from write-down of assets		917			(277	)		n/m
Charitable contribution to foundation		683			—			n/m
Conservation grant of land		—			3,350			n/m
Loss on early extinguishment of debt		2,015			1,429			n/m
Non-operating noninterest expenses		7,424			10,856			n/m
Total noninterest expenses		227,080			181,595			25.0
Income before income taxes and discontinued operations		127,454			138,759			(8.1	)
Income tax expense		40,840			42,480			(3.9	)
Discontinued operations, net of income tax		(396	)		(165	)		n/m
Net income	$	86,218		$	96,114			(10.3	)%
SHARE DATA:
Net income per common share, basic	$	1.18		$	1.54			(23.4	)%
Net income per common share, diluted		1.16			1.50			(22.7	)
Cash dividends declared per common share		0.48			0.45			6.7
Average common shares outstanding, basic		72,921,265			62,470,768			16.7
Average common shares outstanding, diluted		74,294,427			64,019,889			16.0

Financial Highlights, 6

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(dollars in thousands, except share data) (unaudited)

											% Change 9/30/05 vs.
					(Restated)			(Restated)			(Annualized)
		9/30/05			6/30/05			9/30/04			6/30/05			9/30/04
BALANCE SHEET (Period End)
Cash and due from banks		$	264,979		$	269,996		$	210,125			(7.4	)%		26.1	%
Interest-bearing bank balances	��		14,165			21,643			850			(137.1	)		1,566.5
Securities			4,033,597			4,325,967			4,308,485			(26.8	)		(6.4	)
Loans held for sale			59,135			41,427			21,933			169.6			169.6
Loans held for investment			9,293,031			8,966,337			7,984,824			14.5			16.4
Allowance for loan losses			(107,381	)		(105,552	)		(96,318	)		6.9			11.5
Net loans			9,244,785			8,902,212			7,910,439			15.3			16.9
Premises and equipment, net			186,970			183,189			163,428			8.2			14.4
Intangible assets			692,796			693,541			610,347			(0.4	)		13.5
Other assets			508,760			490,658			453,444			14.6			12.2
Total assets		$	14,946,052		$	14,887,206		$	13,657,118			1.6	%		9.4	%
Noninterest-bearing deposits		$	1,508,370		$	1,466,803		$	1,222,467			11.2	%		23.4	%
Interest-bearing deposits			7,617,649			7,406,999			6,590,443			11.3			15.6
Total deposits			9,126,019			8,873,802			7,812,910			11.3			16.8
Federal funds purchased and repurchase agreements			1,336,114			1,328,931			1,753,660			2.1			(23.8	)
Other short-term borrowings			44,649			113,798			51,648			(241.1	)		(13.6	)
Long-term debt			2,751,268			2,901,532			2,543,532			(20.5	)		8.2
Other liabilities			183,555			152,071			117,148			82.1			56.7
Total liabilities			13,441,605			13,370,134			12,278,898			2.1			9.5
Shareholders’ equity			1,504,447			1,517,072			1,378,220			(3.3	)		9.2
Total liabilities and shareholders’ equity		$	14,946,052		$	14,887,206		$	13,657,118			1.6	%		9.4	%
BALANCE SHEET (Averages)
(Averages — Three Months Ended)
Total assets		$	14,945,151		$	14,902,070		$	13,173,844			1.1	%		13.4	%
Intangible assets			(691,881	)		(656,066	)		(551,625	)		21.7			25.4
Tangible assets			14,253,270			14,246,004			12,622,219			0.2			12.9
Loans			9,138,137			8,706,276			7,617,721			19.7			20.0
Securities (excludes unrealized gains (losses) on available for sale securities)			4,290,472			4,731,121			4,313,121			(37.0	)		(0.5	)
Total earning assets			13,462,755			13,460,095			11,963,843			0.1			12.5
Interest-bearing liabilities			11,843,635			11,943,345			10,623,271			(3.3	)		11.5
Total deposits			8,917,737			8,460,833			7,682,631			21.4			16.1
Shareholders’ equity			1,508,140			1,450,674			1,281,463			15.7			17.7
Intangible assets			(691,881	)		(656,066	)		(551,625	)		21.7			25.4
Tangible equity			816,259			794,608			729,838			10.8			11.8
(Averages — Year to Date)
Total assets		$	14,718,772		$	14,603,708		$	11,706,496			3.1	%		25.7	%
Intangible assets			(653,250	)		(633,615	)		(418,889	)		12.3			55.9
Tangible assets			14,065,522			13,970,093			11,287,607			2.7			24.6
Loans			8,712,435			8,496,056			6,543,119			10.1			33.2
Securities (excludes unrealized gains (losses) on available for sale securities)			4,537,052			4,662,386			4,096,363			(10.7	)		10.8
Total earning assets			13,278,459			13,184,784			10,658,607			2.8			24.6
Interest-bearing liabilities			11,778,612			11,745,564			9,529,139			1.1			23.6
Total deposits			8,452,470			8,215,982			6,604,643			11.4			28.0
Shareholders’ equity			1,451,632			1,422,911			1,090,039			8.0			33.2
Intangible assets			(653,250	)		(633,615	)		(418,889	)		12.3			55.9
Tangible equity			798,382			789,296			671,150			4.6			18.9

Financial Highlights, 7

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS — APPENDIX A
Summary of Financial Results as Restated for Accounting Treatment of Derivatives
(dollars in thousands)(unaudited)

	Second Quarter 2005
	As			Change
	Originally			Increase/			As			Second Quarter 2005
	Reported			(Decrease)			Restated			Non-operating			Operating
INCOME STATEMENT
Interest income (tax-equivalent)	$	186,298		$	—		$	186,298		$	—		$	186,298
Interest expense		78,048			4,568			82,616			—			82,616
Net interest income (tax equivalent)		108,250			(4,568	)		103,682			—			103,682
Less: tax equivalent adjustment		1,397			—			1,397			—			1,397
Net interest income		106,853			(4,568	)		102,285			—			102,285
Provision for loan losses		9,944			—			9,944			—			9,944
Net interest income after provision for loan losses		96,909			(4,568	)		92,341			—			92,341
Noninterest income:
Other operating noninterest income		25,513			—			25,513			—			25,513
Net cash settlement of interest rate swaps		—			3,534			3,534			—			3,534
Operating noninterest income		25,513			3,534			29,047			—			29,047
Change in fair value of interest rate swaps		—			22,277			22,277			22,277			—
(Loss) gain on sale of available for sale securities		(1,503	)		—			(1,503	)		(1,503	)		—
Gain (loss) on equity investments		650			—			650			650			—
Total noninterest income		24,660			25,811			50,471			21,424			29,047
Operating noninterest expenses		73,221			—			73,221			—			73,221
Employment contract payments		222			—			222			222			—
Merger-related costs		2,194			—			2,194			2,194			—
Impairment from write-down of assets		917			—			917			917			—
Loss on early extinguishment of debt		2,981			—			2,981			2,981			—
Total noninterest expenses		79,535			—			79,535			6,314			73,221
Income before income taxes		42,034			21,243			63,277			15,110			48,167
Income tax expense		13,661			6,904			20,565			4,911			15,654
Net Income	$	28,373		$	14,339		$	42,712		$	10,199		$	32,513
Average common shares outstanding, diluted		74,421,103						74,421,103						74,421,103
Diluted Earnings Per Share:
GAAP	$	0.38		$	0.19		$	0.57
Operating	$	0.45		$	(0.01	)							$	0.44

	First Quarter 2005
	As			Change
	Originally			Increase/			As			First Quarter 2005
	Reported			(Decrease)			Restated			Non-operating			Operating
INCOME STATEMENT
Interest income (tax-equivalent)	$	171,575		$	—		$	171,575		$	—		$	171,575
Interest expense		66,348			5,652			72,000			—			72,000
Net interest income (tax equivalent)		105,227			(5,652	)		99,575			—			99,575
Less: tax equivalent adjustment		1,326			—			1,326			—			1,326
Net interest income		103,901			(5,652	)		98,249			—			98,249
Provision for loan losses		10,962			—			10,962			—			10,962
Net interest income after provision for loan losses		92,939			(5,652	)		87,287			—			87,287
Noninterest income:
Other operating noninterest income		23,798			—			23,798			—			23,798
Net cash settlement of interest rate swaps		—			4,737			4,737			—			4,737
Operating noninterest income		23,798			4,737			28,535			—			28,535
Change in fair value of interest rate swaps		—			(17,209	)		(17,209	)		(17,209	)		—
(Loss) gain on sale of available for sale securities		234			—			234			234			—
Gain (loss) on equity investments		1,711			—			1,711			1,711			—
Total noninterest income		25,743			(12,472	)		13,271			(15,264	)		28,535
Operating noninterest expenses		66,987			—			66,987			—			66,987
Employment contract payments		(37	)		—			(37	)		(37	)		—
Merger-related costs		305			—			305			305			—
Charitable contribution to foundation		683			—			683			683			—
Gain on early extinguishment of debt		(1,428	)		—			(1,428	)		(1,428	)		—
Total noninterest expenses		66,510			—			66,510			(477	)		66,987
Income before income taxes		52,172			(18,124	)		34,048			(14,787	)		48,835
Income tax expense		17,217			(5,981	)		11,236			(4,932	)		16,168
Discontinued operations, net of income tax		(396	)		—			(396	)		(396	)		—
Net Income	$	34,559		$	(12,143	)	$	22,416		$	(10,251	)	$	32,667
Average common shares outstanding, diluted		73,021,005						73,021,005						73,021,005
Diluted Earnings Per Share:
GAAP	$	0.47		$	(0.17	)	$	0.31
Operating	$	0.46		$	(0.01	)							$	0.45

Financial Highlights, 8

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS — APPENDIX A
Summary of Financial Results as Restated for Accounting Treatment of Derivatives
(dollars in thousands)(unaudited)

				2nd Quarter			3rd Quarter
	3rd Quarter			2005			2004
	2005			(Restated)			(Restated)
Impact on Operating Ratios, Excluding Reclassification for Interest Rate Swaps (1)
NET INTEREST MARGIN
Net interest income (tax equivalent), excluding reclassification for swaps	$	107,567		$	107,216		$	100,496
Less: Net cash settlement of interest rate swaps		(2,377	)		(3,534	)		(7,259	)
Net interest income (tax equivalent)	$	105,190		$	103,682		$	93,237
Average earning assets	$	13,462,755		$	13,460,095		$	11,963,843
Net interest margin, excluding reclassification for swaps (2)		3.17	%		3.19	%		3.34	%
Net interest margin (tax equivalent)		3.10	%		3.09	%		3.10	%
OPERATING NONINTEREST INCOME
Operating noninterest income, excluding reclassification for swaps	$	31,069		$	25,513		$	23,772
Add: Net cash settlement of interest rate swaps		2,377			3,534			7,259
Operating noninterest income	$	33,446		$	29,047		$	31,031
Total operating revenue, excluding reclassification for swaps		138,636			132,729			124,268
Total operating revenue		138,636			132,729			124,268
Operating noninterest income as a % of total operating revenue, excluding reclassification for interest rate swaps		22.41	%		19.22	%		19.13	%
Operating noninterest income as a % of total operating revenue		24.13	%		21.88	%		24.97	%

(1) These operating performance ratios changed due to the reclassification of Net Cash Settlement of interest rate swaps from net interest income (tax-equivalent) to operating noninterest income. With the redesignation of the CD swap derivatives as hedges effective October 2005, TSFG expects accounting classifications to reflect those originally reported before the numbers were restated.

(2) Calculated as tax equivalent net interest income, excluding reclassification for interest rate swaps, as a % of average earning assets (annualized).

Financial Highlights, 9

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS — APPENDIX A
Summary of Financial Results as Restated for Accounting Treatment of Derivatives
(dollars in thousands)(unaudited)

	Nine Months Ended
				(Restated)
	9/30/05			9/30/04
Impact on Operating Ratios, Excluding Reclassification for Interest Rate Swaps (1)
NET INTEREST MARGIN
Net interest income (tax equivalent), excluding reclassification for swaps	$	319,095		$	263,339
Less: Net cash settlement of interest rate swaps		(10,648	)		(21,496	)
Net interest income (tax equivalent)	$	308,447		$	241,843
Average earning assets	$	13,278,459		$	10,658,607
Net interest margin, excluding reclassification for interest rate swaps (2)		3.21	%		3.30	%
Net interest margin (tax equivalent)		3.11	%		3.03	%
OPERATING NONINTEREST INCOME
Operating noninterest income, excluding reclassification for swaps	$	80,380		$	67,061
Add: Net cash settlement of interest rate swaps		10,648			21,496
Operating noninterest income	$	91,028		$	88,557
Total operating revenue, excluding reclassification for swaps		399,475			330,400
Total operating revenue		399,475			330,400
Operating noninterest income as a % of total operating revenue, excluding reclassification for interest rate swaps		20.12	%		20.30	%
Operating noninterest income as a % of total operating revenue		22.79	%		26.80	%

(1) These operating performance ratios changed due to the reclassification of Net Cash Settlement of interest rate swaps from net interest income (tax-equivalent) to operating noninterest income. With the redesignation of the CD swap derivatives as hedges effective October 2005, TSFG expects accounting classifications to reflect those originally reported before the numbers were restated.

(2) Calculated as tax equivalent net interest income, excluding reclassification for interest rate swaps, as a % of average earning assets (annualized).

Financial Highlights, 10

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS — APPENDIX A
Summary of Financial Results as Restated for Accounting Treatment of Derivatives
(dollars in thousands) (unaudited)

	Three Months Ended
	9/30/05
	excluding the reclassification
	for Interest Rate Swaps							9/30/05
	Average		Income/		Yield/			Average		Income/		Yield/
	Balance		Expense		Rate			Balance		Expense		Rate
Assets
Earning assets
Loans(1)	$	9,138,137	$	149,788		6.50	%	$	9,138,137	$	149,788		6.50	%
Investment securities (taxable)(2)		3,883,705		41,657		4.26			3,883,705		41,657		4.26
Investment securities (nontaxable)(3)		406,767		4,574		4.46			406,767		4,574		4.46
Federal funds sold and interest-bearing bank balances		34,146		317		3.68			34,146		317		3.68
Total earning assets		13,462,755		196,336		5.79			13,462,755		196,336		5.79
Non-earning assets		1,482,396							1,482,396
Total assets	$	14,945,151						$	14,945,151
Liabilities and Shareholders’ Equity
Liabilities
Interest-bearing liabilities
Interest-bearing deposits
Interest checking	$	979,487	$	2,533		1.03		$	979,487	$	2,533		1.03
Savings		193,518		151		0.31			193,518		151		0.31
Money market		2,690,104		16,819		2.48			2,690,104		16,819		2.48
Time deposits, excluding brokered deposits		2,254,868		17,863		3.14			2,254,868		17,863		3.14
Total interest-bearing customer deposits (4)		6,117,977		37,366		2.42			6,117,977		37,366		2.42
Brokered deposits		1,353,364		12,407		3.64			1,353,364		14,967		4.39
Total interest-bearing deposits		7,471,341		49,773		2.64			7,471,341		52,333		2.78
Borrowings		4,372,294		38,996		3.54			4,372,294		38,813		3.52
Total interest-bearing liabilities		11,843,635		88,769		2.97			11,843,635		91,146		3.05
Noninterest-bearing liabilities Noninterest-bearing deposits		1,446,396							1,446,396
Other noninterest liabilities		146,980							146,980
Total liabilities		13,437,011							13,437,011
Shareholders’ equity		1,508,140							1,508,140
Total liabilities and shareholders’ equity	$	14,945,151						$	14,945,151
Net interest margin (tax-equivalent)			$	107,567		3.17	%			$	105,190		3.10	%
Less: tax-equivalent adjustment(3)				1,601							1,601
Net interest income			$	105,966						$	103,589
Total cost of customer deposits(5)		7,564,373		37,366		1.96			7,564,373		37,366		1.96
Total cost of wholesale borrowings (6)		5,725,658		51,403		3.56			5,725,658		53,780		3.73

(1)	Nonaccrual loans are included in average balances for yield computations.
(2)	The average balances for investment securities exclude the unrealized gain or loss recorded for available for sale securities.
(3)	The tax-equivalent adjustment to net interest income adjusts the yield for assets earning tax-exempt income to a comparable yield on a taxable basis.
(4)	Interest bearing customer deposits include total deposits less brokered deposits and noninterest-bearing deposits.
(5)	Customer deposits include total deposits less brokered deposits.
(6)	Wholesale borrowings include borrowings and brokered deposits.

Note: Average balances are derived from daily balances.

Financial Highlights, 11