South Financial (TSFG) 8-K The South Financial Group Reports Third Quarter 2007 Earnings

Quarterly Financial Data Supplement (Unaudited)
Third Quarter 2007

	Page
Financial Summary	1
Consolidated Statements of Income	2
Details for Noninterest Income and Noninterest Expenses	3
Consolidated Balance Sheets	4
Investment Securities Portfolio Analysis	5
Loan Portfolio Composition Based on Loan Purpose and Loan Growth	6
Summary of Credit Quality and Allowance for Credit Losses	7
Summary of Loans in NC Development under Investigation	8
Types of Customer Funding and Customer Funding Growth	9
Types of Organic Customer Funding Growth	10
Summary of Wholesale Borrowings, Capital and Capital Ratios	11
Comparative Average Balance Sheets - Yields and Costs	12-13
GAAP to Non-GAAP Reconciliation: Earnings, ROA and ROE	14-16
GAAP to Non-GAAP Reconciliation: Noninterest income as a %    of total revenue and efficiency ratios	17-19
See disclosure of explanation of TSFG’s use of certain Non-GAAP financial measures in the earnings release.

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES THIRD QUARTER 2007 FINANCIAL SUMMARY
Quarterly EPS
•	Net income of $25.8 million, or $0.35 per diluted share
•	Operating earnings of $26.5 million, or $0.36 per diluted share
•	Average diluted shares down 791,339 shares or 1.1% versus the prior quarter
Revenue
•	Total revenue, defined as net interest income plus noninterest income, of $127.5 million
	— Non-operating items: $287,000 net gain on securities
•	Operating revenues of $128.8 million, essentially unchanged versus the prior quarter
•	Tax-equivalent net interest income of $98.3 million, up $236,000 or 1.0% linked-quarter annualized
	— Net interest margin of 3.12%, stable with the prior quarter
	— Average earning assets of $12.5 billion, down 1.6% linked-quarter annualized
•	Operating noninterest income of $30.5 million, down $259,000 or 3.3% linked-quarter annualized
	— Lower mortgage banking income as loan origination volumes slowed
Average Balance Sheet Growth
•	Average loans, up 3.2% linked-quarter annualized
•	Average securities, down $133.5 million since prior quarter; down $520.8 million since September 30, 2006
•	Average customer funding, defined as total deposits less brokered deposits plus customer sweeps, down 4.2% linked-quarter annualized
•	Average wholesale borrowings, including brokered deposits and excluding customer sweeps, up 3.5% linked-quarter annualized
Noninterest Expenses and Operating Efficiency
•	Noninterest expenses of $79.6 million
	— Non-operating items: $1.3 million loss on early extinguishment of debt
•	Operating noninterest expenses of $78.3 million, down $1.9 million or 2.4% versus the prior quarter
	— Decrease of $2.5 million or 3.1% from prior year
•	Cash operating efficiency ratio of 59.3%, an improvement from 60.6% for the prior quarter
Credit Quality
•	Provision for credit losses of $10.5 million
•	Net loan charge-offs of $16.8 million, or 0.66% annualized as a % of average loans held for investment
	— Includes $7.7 million related to the NC development loans
	— Excluding the NC development loans, net loan charge-offs of 0.36%
•	Nonperforming assets of $58.9 million or 0.58% of loans held for investment and foreclosed property
	— Includes $9.4 million related to the NC loans
	— Excluding the NC development loans, nonperforming asset ratio of 0.49%
•	Allowance for credit losses of $120.4 million or 1.18% of loans held for investment
Capital
•	Tangible equity to tangible asset ratio of 6.47%, up from 6.22% at June 30, 2007
•	Tangible equity per share of $11.90, up from $11.35 at June 30, 2007
•	Repurchased 850,000 shares 3Q07 and 3.0 million shares for 2007 YTD
•	Called approximately $70 million of trust preferred securities; approximately $100 million YTD
•	Issued approximately $50 million of trust preferred securities; approximately $125 million YTD
•	After-tax unrealized loss on available for sale securities decreased $20.8 million
•	Tier 1 capital ratio of 9.89%, down from 10.12% at June 30, 2007

1

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

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

	Three Months Ended
	9/30/07		6/30/07		3/31/07		12/31/06		9/30/06
Interest Income
Interest and fees on loans	$	195,393	$	191,961	$	186,628	$	187,385	$	184,476
Interest and dividends on securities:
Taxable		25,390		26,879		28,825		29,876		30,779
Exempt from federal income taxes		2,856		2,888		3,048		3,125		3,140
Total interest and dividends on securities		28,246		29,767		31,873		33,001		33,919
Interest on short-term investments		100		97		141		144		196
Total interest income		223,739		221,825		218,642		220,530		218,591
Interest Expense
Interest on deposits		94,497		92,066		88,479		82,716		77,393
Interest on borrowed funds		32,468		33,238		35,625		41,160		42,515
Total interest expense		126,965		125,304		124,104		123,876		119,908
Net Interest Income		96,774		96,521		94,538		96,654		98,683
Provision for Credit Losses		10,504		17,125		9,013		8,838		6,553
Net interest income after provision for credit losses		86,270		79,396		85,525		87,816		92,130
Noninterest Income		30,773		28,508		27,824		30,257		35,082
Noninterest Expenses		79,595		80,976		82,331		91,022		80,798
Income before income taxes		37,448		26,928		31,018		27,051		46,414
Income tax expense		11,609		8,998		10,500		3,500		14,249
Net Income	$	25,839	$	17,930	$	20,518	$	23,551	$	32,165
Average common shares outstanding, basic		73,146,211		74,050,115		74,736,832		75,161,032		75,003,605
Average common shares outstanding, diluted		73,605,752		74,397,091		75,244,968		75,701,120		75,590,748
Net income per common share, basic	$	0.35	$	0.24	$	0.27	$	0.31	$	0.43
Net income per common share, diluted		0.35		0.24		0.27		0.31		0.43
Cash dividends declared per common share		0.18		0.18		0.18		0.18		0.17

2

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

DETAILS FOR NONINTEREST INCOME AND NONINTEREST EXPENSES

(dollars in thousands) (unaudited)

	Three Months Ended
	9/30/07		6/30/07			3/31/07			12/31/06			9/30/06
Noninterest Income
Service charges on deposit accounts	$	11,213	$	11,223		$	10,613		$	10,704		$	11,457
Debit card income		2,445		2,403			2,177			2,198			2,055
Customer service fee income		1,533		1,402			1,291			1,267			1,117
Total customer fee income		15,191		15,028			14,081			14,169			14,629
Retail investment services		2,313		2,282			1,958			1,671			1,689
Insurance income		2,839		2,987			3,297			3,411			2,831
Trust and investment management income		1,642		1,734			1,594			1,506			1,483
Benefits administration fees		889		749			742			722			795
Total wealth management income		7,683		7,752			7,591			7,310			6,798
Mortgage banking income		834		1,877			2,069			2,224			1,969
Bank-owned life insurance		2,974		4,454			2,851			2,932			2,916
Merchant processing income, net		928		771			735			527			619
Gain (loss) on certain derivative activities		198		(1,497	)		97			596			3,924
Loss on indirect auto loans		—		—			—			—			(667	)
Other		2,678		2,360			1,785			2,738			2,396
Operating noninterest income (noninterest income,      excluding non-operating items)		30,486		30,745			29,209			30,496			32,584
Gain (loss) on securities		287		(2,237	)		(1,385	)		(239	)		—
Gain on disposition of assets and liabilities		—		—			—			—			2,498
Non-operating noninterest income (loss)		287		(2,237	)		(1,385	)		(239	)		2,498
Total noninterest income	$	30,773	$	28,508		$	27,824		$	30,257		$	35,082
Noninterest Expenses
Salaries and wages	$	34,535	$	34,258		$	35,072		$	35,188		$	34,494
Employee benefits		8,862		9,245			9,759			8,927			9,080
Occupancy		8,723		8,545			8,608			8,856			7,949
Furniture and equipment		6,543		6,486			6,462			6,579			6,217
Professional services		4,278		4,914			4,103			5,637			4,549
Advertising and business development		1,443		1,973			1,931			2,937			2,264
Telecommunications		1,404		1,418			1,393			1,384			1,407
Amortization of intangibles		1,907		2,136			2,001			2,156			2,204
Other		10,601		11,224			11,242			13,547			12,634
Operating noninterest expenses (noninterest expenses,      excluding non-operating items)		78,296		80,199			80,571			85,211			80,798
Employment contract buyouts and severance		—		546			1,760			4,990			—
Loss on early extinguishment of debt		1,299		231			—			821			—
Non-operating noninterest expenses		1,299		777			1,760			5,811			—
Total noninterest expenses	$	79,595	$	80,976		$	82,331		$	91,022		$	80,798

3

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(dollars in thousands) (unaudited)

	9/30/07			6/30/07			3/31/07			12/31/06			9/30/06
Assets
Cash and due from banks	$	221,529		$	267,005		$	257,884		$	326,567		$	295,534
Interest-bearing bank balances		520			263			7,012			31,264			5,224
Federal funds sold and securities     purchased to resell		—			—			50,000			—			7,500
Securities
Available for sale		2,323,241			2,433,341			2,546,047			2,743,456			2,820,383
Held to maturity		41,174			41,892			46,217			52,308			52,790
Total securities		2,364,415			2,475,233			2,592,264			2,795,764			2,873,173
Loans held for sale		19,572			35,718			33,519			28,556			36,155
Loans held for investment		10,173,237			10,029,228			9,898,134			9,701,867			9,513,833
Less: Allowance for loan losses		(118,861	)		(125,545	)		(113,736	)		(111,663	)		(109,401	)
Net loans held for investment		10,054,376			9,903,683			9,784,398			9,590,204			9,404,432
Premises and equipment, net		226,784			224,951			223,738			219,163			213,820
Accrued interest receivable		73,383			75,851			72,801			77,523			72,459
Goodwill		650,637			650,544			650,536			650,492			650,171
Other intangible assets, net		29,032			30,939			33,075			35,076			37,232
Other assets		459,973			475,488			452,920			455,907			452,002
	$	14,100,221		$	14,139,675		$	14,158,147		$	14,210,516		$	14,047,702
Liabilities and Shareholders’ Equity
Liabilities
Deposits
Noninterest-bearing	$	1,164,312		$	1,244,834		$	1,286,800		$	1,280,908		$	1,261,421
Interest-bearing		8,337,357			8,840,972			8,664,408			8,235,832			7,920,531
Total deposits		9,501,669			10,085,806			9,951,208			9,516,740			9,181,952
Federal funds purchased and repurchase       agreements		1,194,293			1,210,921			1,496,168			1,421,099			1,614,664
Other short-term borrowings		876,288			221,729			111,365			347,620			220,366
Long-term debt		732,203			857,248			809,290			1,130,475			1,261,306
Accrued interest payable		73,418			77,751			77,380			68,940			60,075
Other liabilities		174,098			168,033			151,126			163,610			162,519
Total liabilities		12,551,969			12,621,488			12,596,537			12,648,484			12,500,882
Shareholders’ equity
Preferred stock		—			—			—			—			—
Common stock		72,971			73,699			74,673			75,341			75,192
Surplus		1,116,361			1,129,499			1,150,288			1,167,685			1,162,889
Retained earnings		391,019			378,399			373,788			367,261			357,371
Guarantee of employee stock ownership plan debt		—			(39	)		(95	)		(151	)		(210	)
Accumulated other comprehensive loss, net of       income tax		(32,099	)		(63,371	)		(37,044	)		(48,104	)		(48,422	)
Total shareholders’ equity		1,548,252			1,518,187			1,561,610			1,562,032			1,546,820
	$	14,100,221		$	14,139,675		$	14,158,147		$	14,210,516		$	14,047,702

4

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

INVESTMENT SECURITIES PORTFOLIO ANALYSIS

(dollars in thousands) (unaudited)

	9/30/07			6/30/07			3/31/07			12/31/06			9/30/06
Investment Securities Portfolio
Available for sale (at fair value):
U.S. Treasury	$	168,614		$	167,195		$	167,295		$	166,719		$	174,739
U.S. Government agencies		659,681			650,581			657,708			653,034			655,447
Mortgage-backed securities		1,119,547			1,158,498			1,246,384			1,400,288			1,459,220
State and municipal		303,388			308,070			315,372			341,488			345,077
Other investments (1)		72,011			148,997			159,288			181,927			185,900
Total available for sale securities		2,323,241			2,433,341			2,546,047			2,743,456			2,820,383
Held to maturity (at amortized cost)		41,174			41,892			46,217			52,308			52,790
Total securities	$	2,364,415		$	2,475,233		$	2,592,264		$	2,795,764		$	2,873,173
Total securities as a percentage of    total assets		16.8	%		17.5	%		18.3	%		19.7	%		20.5	%

	September 30, 2007
	Amortized Cost		Percentage of Total			Duration		Book Yield
Debt Securities
U.S. Treasury	$	169,095		7.2	%		0.9		4.07	%
U.S. Government agencies		663,879		28.5			2.0		5.42
Mortgage-backed securities:
Collateralized mortgage obligations		847,524		36.3			5.6		4.55
Adjustable rate mortgages		213,752		9.2			2.3		4.85
Pass-through		112,134		4.8			3.5		4.79
State and municipal		306,420		13.1			3.2		4.86
Corporate bonds		20,789		0.9			4.0		5.74
Total available for sale debt securities	$	2,333,593		100.0	%		3.5		4.85	%
Fixed interest rate:
Mortgage-backed securities	$	958,067		41.1	%		5.3		4.58	%
Other		1,135,237		48.6			2.2		5.04
Variable interest rate:
Mortgage-backed securities		215,343		9.2			2.3		4.85
Other		24,946		1.1			1.4		6.71
Total available for sale debt securities	$	2,333,593		100.0	%		3.5		4.85	%

Projected Cash Flows for Debt Securities

Year	Roll-Off Yield			Projected Annual Cash Flows by Interest Rate Scenario
				Current		Up 1.00%		Down 1.00%
Remainder of 2007		4.02	%	$	167,883	$	161,477	$	641,522
2008		4.27			273,365		176,910		609,722

Projected Interest Rate Shock for Debt Securities

Interest Rate Scenario	Estimated Impact on Fair Value			Duration
Up 2.00%		(8.2	)%		4.9
Up 1.00%		(3.9	)		4.5
Flat		—			3.5
Down 1.00%		2.8			2.2
Down 2.00%		4.5			1.0

The estimated decrease in fair value for a five year U.S. Treasury Note when interest rates increase 100 basis points is 4.31%.
(1)	Other investments in available for sale securities includes corporate bonds, FHLB stock, community bank stocks, and other equity securities.

5

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

LOAN PORTFOLIO COMPOSITION BASED ON LOAN PURPOSE AND LOAN GROWTH

(dollars in thousands) (unaudited)

	9/30/07			6/30/07			3/31/07			12/31/06			9/30/06
Commercial Loans
Commercial and industrial	$	2,693,973		$	2,569,628		$	2,596,705		$	2,491,210		$	2,378,533
Owner - occupied real estate		1,042,131			961,806			883,738			830,179			859,306
Commercial real estate		4,178,653			4,258,837			4,209,149			4,171,631			4,060,602
		7,914,757			7,790,271			7,689,592			7,493,020			7,298,441
Consumer Loans
Indirect - sales finance		707,819			684,053			666,801			660,401			651,419
Direct retail		412,827			430,760			434,521			439,478			432,254
Home equity		552,073			547,167			531,922			528,909			537,406
		1,672,719			1,661,980			1,633,244			1,628,788			1,621,079
Mortgage Loans		585,761			576,977			575,298			580,059			594,313
Total loans held for investment	$	10,173,237		$	10,029,228		$	9,898,134		$	9,701,867		$	9,513,833
Percentage of Loans Held for Investment
Commercial and industrial		26.5	%		25.6	%		26.2	%		25.7	%		25.0	%
Owner - occupied real estate		10.2			9.6			8.9			8.6			9.0
Commercial real estate		41.1			42.5			42.5			43.0			42.7
Consumer		16.4			16.6			16.5			16.7			17.0
Mortgage		5.8			5.7			5.9			6.0			6.3
Total		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%

	For The Period Ended
	9/30/07			6/30/07			3/31/07			12/31/06			9/30/06
Non organic change in loans held for investment      related to:
Origination and transfer of indirect auto loans        originally held for sale to held for investment	$	—		$	—		$	—		$	—		$	51,019
Other acquisitions (dispositions) (1)		—			—			—			—			(2,629	)
Growth in Loans Held for Investment (2)
Growth vs. prior quarter, annualized		5.7	%		5.3	%		8.2	%		7.8	%		3.1	%
Growth year-to-date, annualized		6.5			6.8			8.2			2.8			1.1
Growth in Loans Held for Investment, Excluding
Changes from Acquisitions and Dispositions (2)
Organic growth vs. prior quarter, annualized		5.7	%		5.3	%		8.2	%		7.8	%		1.1	%
Organic growth year-to-date, annualized		6.5			6.8			8.2			6.6			6.2

(1)	Other acquisitions (dispositions) during the three months ended September 30, 2006 related to the sale of the Mullins branch.
(2)	At June 30, 2006 and December 31, 2005, loans held for investment totaled $9,439,445 and $9,439,935, respectively. Non organic change of $410,628 in the first six months of 2006 related to the sale of indirect auto loans and the origination and transfer of indirect auto loans originally held for sale to held to investment.

6

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

SUMMARY OF CREDIT QUALITY AND ALLOWANCE FOR CREDIT LOSSES

(dollars in thousands) (unaudited)

	At and for the Three Months Ended
	9/30/07			6/30/07			3/31/07			12/31/06			9/30/06
Credit Quality
Loans held for investment	$	10,173,237		$	10,029,228		$	9,898,134		$	9,701,867		$	9,513,833
Allowance for loan losses		118,861			125,545			113,736			111,663			109,401
Allowance for credit losses		120,424			126,721			114,822			112,688			110,349
Nonperforming loans (1)		53,225			41,527			43,222			37,168			31,396
Foreclosed property (other real estate owned     and personal property repossessions)		5,658			4,028			3,572			4,341			4,851
Nonperforming assets	$	58,883		$	45,555		$	46,794		$	41,509		$	36,247
Nonperforming loans as a % of loans     held for investment		0.52	%		0.41	%		0.44	%		0.38	%		0.33	%
Nonperforming assets as a % of loans held     for investment and foreclosed property		0.58			0.45			0.47			0.43			0.38
Allowance for loan losses as a % of loans     held for investment		1.17			1.25			1.15			1.15			1.15
Allowance for credit losses as a % of loans     held for investment		1.18			1.26			1.16			1.16			1.16
Allowance for loan losses to nonperforming     loans		2.23	x		3.02	x		2.63	x		3.00	x		3.48	x
Impaired loans (1)	$	38,028		$	33,596		$	36,403		$	28,733		$	24,604
Specific allowance for impaired loans		11,010			9,414			7,716			6,686			3,987
Loans past due 90 days or more (mortgage     and consumer with interest accruing)		2,629			2,503			193			3,129			3,163
Net loan charge-offs		16,801			5,226			6,879			6,499			6,524
Average loans held for investment		10,042,419			9,947,636			9,783,328			9,589,732			9,467,123
Net loan charge-offs as a % of average     loans held for investment (annualized)		0.66	%		0.21	%		0.29	%		0.27	%		0.27	%
Allowance for Loan Losses
Balance at beginning of period	$	125,545		$	113,736		$	111,663		$	109,401		$	108,995
Provision for loan losses		10,117			17,035			8,952			8,761			6,930
Loans charged-off		(17,926	)		(7,622	)		(8,611	)		(9,197	)		(9,768	)
Recoveries of loans previously charged-off		1,125			2,396			1,732			2,698			3,244
Balance at end of period	$	118,861		$	125,545		$	113,736		$	111,663		$	109,401
Reserve for Unfunded Lending Commitments
Balance at beginning of period	$	1,176		$	1,086		$	1,025		$	948		$	1,325
Provision for unfunded lending commitments		387			90			61			77			(377	)
Balance at end of period	$	1,563		$	1,176		$	1,086		$	1,025		$	948
Allowance for Credit Losses
Balance at beginning of period	$	126,721		$	114,822		$	112,688		$	110,349		$	110,320
Provision for credit losses		10,504			17,125			9,013			8,838			6,553
Loans charged-off		(17,926	)		(7,622	)		(8,611	)		(9,197	)		(9,768	)
Recoveries of loans previously charged-off		1,125			2,396			1,732			2,698			3,244
Balance at end of period	$	120,424		$	126,721		$	114,822		$	112,688		$	110,349

⁽¹⁾ At September 30, 2007, June 30, 2007, March 31, 2007, December 31, 2006, and September 30, 2006, these credit quality indicators (nonperforming loans and impaired loans) included $1.8 million, $1.9 million, $1.9 million, $500,000, and $661,000, respectively, in restructured loans.

7

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

SUMMARY OF LOANS IN NC DEVELOPMENT UNDER INVESTIGATION

(dollars in thousands) (unaudited)

	At and for the Nine Months Ended September 30, 2007
��
	# of Loans		Outstanding Balance		Charge-offs			Net Balance		Nonaccrual		Allocated Allowance
Lot loans:
Performing (3)		12	$	1,764	$	—		$	1,764	$	—		included below
Nonperforming pool		81		15,658		7,731	(1)		7,927		7,927	$	1,269
Development loans		2		3,007		1,500	(2)		1,507		1,507		—
Total		95	$	20,429	$	9,231		$	11,198	$	9,434	$	1,269

CREDIT QUALITY - Excluding the Loans in the NC Development under Investigation

	At and for the Period Ended September 30, 2007
	As reported (GAAP)			Adjustment for NC loans			Excluding NC loans (Non-GAAP)
Loans held for investment	$	10,173,237		$	(11,198	)	$	10,162,039
Allowance for loan losses		(118,861	)		1,269			(117,592	)
Allowance for credit losses		(120,424	)		1,269			(119,155	)
Nonperforming loans	$	53,225		$	(9,434	)	$	43,791
Foreclosed property (other real estate owned      and personal property repossessions)		5,658			—			5,658
Nonperforming assets	$	58,883		$	(9,434	)	$	49,449
Nonperforming loans as a % of loans held for      investment		0.52	%					0.43	%
Nonperforming assets as a % of loans held for      investment and foreclosed property		0.58						0.49
Allowance for loan losses as a % of loans HFI		1.17						1.16
Allowance for credit losses as a % of loans HFI		1.18						1.17
Allowance for loan losses to nonperforming loans		2.23	x					2.69	x
Loans past due 90 days or more (mortgage and      consumer with interest accruing)	$	2,629		$	—		$	2,629
Net loan charge-offs:
Three months ended		16,801			(7,731	)		9,070
Year to date		28,906			(9,231	)		19,675
Net loan charge-offs as a % of average loans         held for investment (annualized):
Three months ended		0.66	%					0.36	%
Year to date		0.39						0.27

(1)	Approximately 50% of the outstanding balance was charged-off in the third quarter of 2007. The pool may be adjusted in future periods as losses are realized.
(2)	Charged-off in the second quarter of 2007.
(3)	All loans are less than 60 days past due at September 30, 2007.

8

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES

TYPES OF CUSTOMER FUNDING AND CUSTOMER FUNDING GROWTH

(dollars in thousands) (unaudited)

	9/30/07			6/30/07			3/31/07			12/31/06			9/30/06
Noninterest-bearing	$	1,164,312		$	1,244,834		$	1,286,800		$	1,280,908		$	1,261,421
Interest-bearing checking		1,100,428			1,177,609			1,198,714			1,208,125			1,245,167
Money market accounts		2,184,822			2,245,466			2,374,242			2,435,413			2,477,982
Savings accounts		169,091			177,289			184,283			181,192			188,629
Core deposits		4,618,653			4,845,198			5,044,039			5,105,638			5,173,199
Time deposits under $100,000		1,393,740			1,363,462			1,320,108			1,272,056			1,231,553
Time deposits of $100,000 or more		1,505,771			1,583,653			1,609,572			1,514,615			1,403,696
Customer deposits (1)		7,518,164			7,792,313			7,973,719			7,892,309			7,808,448
Brokered deposits		1,983,505			2,293,493			1,977,489			1,624,431			1,373,504
Total deposits		9,501,669			10,085,806			9,951,208			9,516,740			9,181,952
Less: Brokered deposits		(1,983,505	)		(2,293,493	)		(1,977,489	)		(1,624,431	)		(1,373,504	)
Add: Customer sweeps		599,021			556,622			479,698			500,288			378,116
Customer funding (2)	$	8,117,185		$	8,348,935		$	8,453,417		$	8,392,597		$	8,186,564
Percentage of Deposits
Noninterest-bearing		12.2	%		12.3	%		12.9	%		13.4	%		13.7	%
Interest-bearing checking		11.6			11.7			12.0			12.7			13.6
Money market accounts		23.0			22.3			23.9			25.6			27.0
Savings accounts		1.8			1.8			1.8			1.9			2.0
Core deposits		48.6			48.1			50.6			53.6			56.3
Time deposits under $100,000		14.7			13.5			13.3			13.4			13.4
Time deposits of $100,000 or more		15.8			15.7			16.2			15.9			15.3
Customer deposits (1)		79.1			77.3			80.1			82.9			85.0
Brokered deposits		20.9			22.7			19.9			17.1			15.0
Total deposits		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%

	For The Period Ended
	9/30/07			6/30/07			3/31/07			12/31/06			9/30/06
Growth vs. Prior Quarter, Annualized (3)
Noninterest-bearing		(25.7	)%		(13.1	)%		1.9	%		6.1	%		(55.3	)%
Core deposits		(18.6	)		(15.8	)		(4.9	)		(5.2	)		(2.2	)
Total deposits		(23.0	)		5.4			18.5			14.5			(2.5	)
Customer funding (2)		(11.0	)		(5.0	)		2.9			10.0			0.1
Growth Year-To-Date, Annualized (4)
Noninterest-bearing		(12.2	)%		(5.7	)%		1.9	%		(12.2	)%		(18.1	)%
Core deposits		(12.8	)		(10.3	)		(4.9	)		0.1			1.9
Total deposits		(0.2	)		12.1			18.5			3.1			(0.8	)
Customer funding (2)		(4.4	)		(1.0	)		2.9			2.3			(0.2	)

(1)	Total deposits less brokered deposits.
(2)	Total deposits less brokered deposits plus customer sweeps.
(3)	At June 30, 2006, noninterest-bearing totaled $1,465,811, core deposits totaled $5,202,623, total deposits totaled $9,240,319, and customer funding totaled $8,184,514.
(4)	At December 31, 2005, noninterest-bearing totaled $1,458,914, core deposits totaled $5,099,040, total deposits totaled $9,234,437, and customer funding totaled $8,201,571.

9

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
TYPES OF ORGANIC CUSTOMER FUNDING GROWTH
(dollars in thousands) (unaudited)

	For The Period Ended
	9/30/07			6/30/07			3/31/07			12/31/06			9/30/06
Noninterest-Bearing
Beginning balance	$	1,244,834		$	1,286,800		$	1,280,908		$	1,261,421		$	1,465,811
Increase (decrease) during the three     months ended related to:
Organic change		(80,522	)		(41,966	)		5,892			19,487			(202,167	)
Bank acquisitions (dispositions) (1)		—			—			—			—			(2,223	)
Ending balance	$	1,164,312		$	1,244,834		$	1,286,800		$	1,280,908		$	1,261,421
Core Deposits
Beginning balance	$	4,845,198		$	5,044,039		$	5,105,638		$	5,173,199		$	5,202,623
Increase (decrease) during the three     months ended related to:
Organic change		(226,545	)		(198,841	)		(61,599	)		(67,561	)		(13,848	)
Bank acquisitions (dispositions) (1)		—			—			—			—			(15,576	)
Ending balance	$	4,618,653		$	4,845,198		$	5,044,039		$	5,105,638		$	5,173,199
Customer Funding (2)
Beginning balance	$	8,348,935		$	8,453,417		$	8,392,597		$	8,186,564		$	8,184,514
Increase (decrease) during the three     months ended related to:
Organic change		(231,750	)		(104,482	)		60,820			206,033			29,991
Bank acquisitions (dispositions) (1)		—			—			—			—			(27,941	)
Ending balance	$	8,117,185		$	8,348,935		$	8,453,417		$	8,392,597		$	8,186,564
Organic Change vs. Prior Quarter, Annualized (3)
Noninterest-bearing		(25.7	)%		(13.1	)%		1.9	%		6.1	%		(54.7	)%
Core deposits		(18.6	)		(15.8	)		(4.9	)		(5.2	)		(1.1	)
Customer funding (2)		(11.0	)		(5.0	)		2.9			10.0			1.5
Organic Change Year-To-Date, Annualized (4)
Noninterest-bearing		(12.2	)%		(5.7	)%		1.9	%		(12.0	)%		(17.9	)%
Core deposits		(12.8	)		(10.3	)		(4.9	)		0.4			2.4
Customer funding (2)		(4.4	)		(1.0	)		2.9			2.7			0.2

(1)	The non organic change in deposits relates to the September, 2006 disposition of the Mullins branch.
(2)	Total deposits less brokered deposits plus customer sweeps.
(3)	At June 30, 2006, noninterest-bearing totaled $1,465,811, core deposits totaled $5,202,623, and customer funding totaled $8,184,514.
(4)	At December 31, 2005, noninterest-bearing totaled $1,458,914, core deposits totaled $5,099,040, and customer funding totaled $8,201,571.

10

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
SUMMARY OF WHOLESALE BORROWINGS, CAPITAL, CAPITAL RATIOS, UNREALIZED
LOSSES ON AVAILABLE FOR SALE SECURITIES, AND MARKET RATES FOR
U.S. TREASURY NOTES
(dollars in thousands) (unaudited)

	9/30/07			6/30/07			3/31/07			12/31/06			9/30/06
Types of wholesale borrowings
Short-term borrowings
Federal funds purchased and repurchase     agreements	$	595,272		$	654,299		$	1,016,470		$	920,811		$	1,236,548
Customer sweeps		599,021			556,622			479,698			500,288			378,116
FHLB advances		175,000			75,000			75,000			175,000			175,000
Commercial paper		32,601			32,687			35,584			32,631			36,032
Treasury, tax and loan note		668,687			114,042			781			139,989			9,334
Total short-term borrowings		2,070,581			1,432,650			1,607,533			1,768,719			1,835,030
Long-term borrowings
Repurchase agreements		200,000			200,000			200,000			521,000			596,000
FHLB advances		223,093			328,100			328,107			328,113			339,620
Subordinated notes		242,478			262,067			188,871			188,871			233,016
Manditorily redeemable preferred stock of subsidiary		64,800			64,800			89,800			89,800			89,800
Note payable		797			808			818			828			838
Employee stock ownership plan note payable		—			50			125			200			275
Purchase accounting premiums, net of amortization		1,035			1,423			1,569			1,663			1,757
Total long-term borrowings		732,203			857,248			809,290			1,130,475			1,261,306
Total borrowings		2,802,784			2,289,898			2,416,823			2,899,194			3,096,336
Less: Customer sweeps		(599,021	)		(556,622	)		(479,698	)		(500,288	)		(378,116	)
Add: Brokered deposits		1,983,505			2,293,493			1,977,489			1,624,431			1,373,504
Total wholesale borrowings	$	4,187,268		$	4,026,769		$	3,914,614		$	4,023,337		$	4,091,724
Wholesale borrowings as a percentage     of total assets		29.7	%		28.5	%		27.6	%		28.3	%		29.1	%
Regulatory Capital
Tier 1 capital	$	1,152,663		$	1,171,055		$	1,115,023		$	1,123,448		$	1,143,708
Tier 2 capital		161,224			167,521			177,236			179,021			176,701
Total risk-based capital		1,313,887			1,338,576			1,292,259			1,302,469			1,320,409
Total risk-weighted assets		11,650,676			11,575,533			11,424,481			11,502,152			11,277,236
Tangible Equity
Shareholders’ equity	$	1,548,252		$	1,518,187		$	1,561,610		$	1,562,032		$	1,546,820
Intangible assets		(679,669	)		(681,483	)		(683,611	)		(685,568	)		(687,403	)
Tangible equity		868,583			836,704			877,999			876,464			859,417
Capital Ratios
Total risk-based capital		11.28	%		11.56	%		11.31	%		11.32	%		11.71	%
Tier 1 risk-based capital		9.89			10.12			9.76			9.77			10.14
Leverage ratio		8.64			8.73			8.28			8.34			8.60
Tangible equity to tangible assets ratio		6.47			6.22			6.52			6.48			6.43
Impact of unrealized (gain) loss		0.27			0.41			0.26			0.33			0.34
Tangible equity to tangible assets ratio,       excluding unrealized gain or loss		6.74			6.63			6.78			6.81			6.77
Unrealized Losses on AFS Securities
Gross (included in AFS securities)	$	(61,462	)	$	(94,586	)	$	(59,764	)	$	(75,302	)	$	(77,224	)
Net of income tax (included in equity)		(38,717	)		(59,565	)		(37,601	)		(47,378	)		(48,599	)
Market Rates for U.S. Treasury Notes
Three year		4.03	%		4.89	%		4.54	%		4.74	%		4.62	%
Five year		4.23			4.92			4.54			4.70			4.59

11

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
COMPARATIVE AVERAGE BALANCES - YIELDS AND COSTS
(dollars in thousands) (unaudited)

	Three Months Ended
	9/30/07							6/30/07							3/31/07
	Average Balance		Income/ Expense			Yield/ Rate		Average Balance		Income/ Expense			Yield/ Rate		Average Balance		Income/ Expense		Yield/ Rate
Assets
Earning assets
Commercial loans	$	7,799,177	$	154,655		7.87	%	$	7,724,530	$	152,338		7.91	%	$	7,579,574	$	148,078	7.92	%
Consumer loans		1,570,591		29,432		7.43			1,584,646		29,382		7.44			1,570,745		28,957	7.48
Indirect loans		695,686		12,188		6.95			674,961		11,271		6.70			662,691		10,646	6.52
Risk management derivatives     tied to loans		—		(882	)				—		(1,030	)				—		(1,053)
Total loans(1)		10,065,454		195,393		7.70			9,984,137		191,961		7.71			9,813,010		186,628	7.71
Investment securities      (taxable)(2)		2,121,044		25,390		4.79			2,247,092		26,879		4.79			2,414,896		28,825	4.78
Investment securities      (nontaxable)(3)		351,584		4,394		5.00			359,043		4,443		4.95			383,804		4,689	4.89
Total investment securities		2,472,628		29,784		4.82			2,606,135		31,322		4.81			2,798,700		33,514	4.79
Federal funds sold,     interest-bearing bank     balances, and other temp     investments		6,574		100		6.03			6,376		97		6.10			8,331		141	6.86
Total earning assets		12,544,656		225,277		7.13			12,596,648		223,380		7.11			12,620,041		220,283	7.06
Non-earning assets		1,477,862							1,496,431							1,528,013
Total assets	$	14,022,518						$	14,093,079						$	14,148,054
Liabilities and Shareholders’   Equity
Liabilities
Interest-bearing liabilities
Interest-bearing deposits
Interest checking	$	1,122,793	$	5,571		1.97		$	1,176,182	$	6,029		2.06		$	1,187,239	$	5,935	2.03
Savings		172,110		697		1.61			181,166		736		1.63			178,940		706	1.60
Money market		2,236,493		22,390		3.97			2,294,181		22,528		3.94			2,377,771		23,537	4.01
Time deposits, excluding        brokered deposits		2,905,426		36,594		5.00			2,910,284		36,407		5.02			2,893,638		35,581	4.99
Brokered deposits		2,208,381		29,245		5.25			2,042,664		26,366		5.18			1,771,081		22,720	5.20
Total interest-bearing          deposits		8,645,203		94,497		4.34			8,604,477		92,066		4.29			8,408,669		88,479	4.27
Customer sweeps		559,906		6,237		4.42			496,030		5,528		4.47			453,928		4,981	4.45
Other borrowings(4)		1,858,800		26,231		5.60			1,989,109		27,710		5.59			2,270,120		30,644	5.47
Total interest-bearing        liabilities		11,063,909		126,965		4.55			11,089,616		125,304		4.53			11,132,717		124,104	4.52
Noninterest-bearing liabilities
Noninterest-bearing deposits		1,198,350							1,225,075							1,230,320
Other noninterest liabilities		240,771							231,996							233,248
Total liabilities		12,503,030							12,546,687							12,596,285
Shareholders’ equity		1,519,488							1,546,392							1,551,769
Total liabilities and shareholders’ equity	$	14,022,518						$	14,093,079						$	14,148,054
Net interest margin (tax-    equivalent)			$	98,312		3.12	%			$	98,076		3.12	%			$	96,179	3.08	%
Less: tax-equivalent    adjustment(3)				1,538							1,555							1,641
Net interest income			$	96,774						$	96,521						$	94,538
Supplemental data:
Customer funding(5)	$	8,195,078	$	71,489		3.46	%	$	8,282,918	$	71,228		3.45	%	$	8,321,836	$	70,740	3.45	%
Wholesale borrowings(6)		4,067,181		55,476		5.41			4,031,773		54,076		5.38			4,041,201		53,364	5.36
Total funding(7)	$	12,262,259	$	126,965		4.11		$	12,314,691	$	125,304		4.08		$	12,363,037	$	124,104	4.07

(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)	During third quarter 2007, TSFG capitalized $188,000 of interest in conjunction with the construction of its expanded corporate facilities.
(5)	Customer funding includes total deposits less brokered deposits plus customer sweeps.
(6)	TSFG defines wholesale borrowings as borrowings less customer sweeps plus brokered deposits. For purposes of this table, wholesale borrowings equal the sum of other borrowings and brokered deposits, as customer sweeps are presented separately.
(7)	Total funding includes customer funding and wholesale borrowings.
Note: Average balances are derived from daily balances.

12

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
COMPARATIVE AVERAGE BALANCES - YIELDS AND COSTS - CONTINUED
(dollars in thousands) (unaudited)

	Three Months Ended
	12/31/06						9/30/06
	Average Balance		Income/ Expense		Yield/ Rate		Average Balance		Income/ Expense		Yield/ Rate
Assets
Earning assets
Loans (1)	$	9,623,050	$	187,385	7.73	%	$	9,523,286	$	184,476	7.69	%
Investment securities (taxable) (2)		2,503,989		29,876	4.77			2,586,438		30,779	4.76
Investment securities (nontaxable) (3)		400,117		4,808	4.81			407,005		4,831	4.75
Total investment securities		2,904,106		34,684	4.78			2,993,443		35,610	4.76
Federal funds sold, interest-bearing bank     balances, and other temp investments		11,521		144	4.96			13,479		196	5.77
Total earning assets		12,538,677		222,213	7.04			12,530,208		220,282	6.98
Non-earning assets		1,592,004						1,443,500
Total assets	$	14,130,681					$	13,973,708
Liabilities and Shareholders’ Equity
Liabilities
Interest-bearing liabilities
Interest-bearing deposits
Interest checking	$	1,106,819	$	5,770	2.07		$	1,132,556	$	5,869	2.06
Savings		184,733		687	1.48			187,089		577	1.22
Money market		2,445,437		24,109	3.91			2,420,756		22,771	3.73
Time deposits, excluding brokered deposits		2,687,712		32,635	4.82			2,620,505		29,653	4.49
Brokered deposits		1,478,336		19,515	5.24			1,344,521		18,523	5.47
Total interest-bearing deposits		7,903,037		82,716	4.15			7,705,427		77,393	3.98
Customer sweeps		414,742		4,695	4.49			369,697		4,274	4.59
Other borrowings		2,645,462		36,465	5.47			2,811,224		38,241	5.40
Total interest-bearing liabilities		10,963,241		123,876	4.48			10,886,348		119,908	4.37
Noninterest-bearing liabilities
Noninterest-bearing deposits		1,302,329						1,369,032
Other noninterest liabilities		306,023						217,223
Total liabilities		12,571,593						12,472,603
Shareholders’ equity		1,559,088						1,501,105
Total liabilities and shareholders’ equity	$	14,130,681					$	13,973,708
Net interest margin (tax-equivalent)			$	98,337	3.12	%			$	100,374	3.19	%
Less: tax-equivalent adjustment (3)				1,683						1,691
Net interest income			$	96,654					$	98,683
Supplemental data:
Customer funding (4)	$	8,141,772	$	67,896	3.31	%	$	8,099,635	$	63,144	3.09	%
Wholesale borrowings (5)		4,123,798		55,980	5.39			4,155,745		56,764	5.42
Total funding (6)	$	12,265,570	$	123,876	4.01		$	12,255,380	$	119,908	3.88

(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)	Customer funding includes total deposits less brokered deposits plus customer sweeps.
(5)	TSFG defines wholesale borrowings as borrowings less customer sweeps plus brokered deposits. For purposes of this table, wholesale borrowings equal the sum of other borrowings and brokered deposits, as customer sweeps are presented separately.
(6)	Total funding includes customer funding and wholesale borrowings
Note: Average balances are derived from daily balances.

13

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands, except share data) (unaudited)

	Three Months Ended
	9/30/07					6/30/07					3/31/07
				Diluted EPS					Diluted EPS					Diluted EPS
Net Income, as Reported (GAAP)	$	25,839		$	0.35	$	17,930		$	0.24	$	20,518		$	0.27
Non-Operating Items
(Gain) loss on securities		(287	)				2,237					1,385
Employment contract buyouts and severance		—					546					1,760
Loss on early extinguishment of debt		1,299					231					—
Related income taxes		(314	)				(1,008	)				(1,065	)
Operating Earnings (Net Income, Excluding     Non-Operating Items)		26,537			0.36		19,936			0.27		22,598			0.30
Amortization of intangibles		1,907					2,136					2,001
Related income taxes		(591	)				(714	)				(677	)
Cash Operating Earnings (Net Income,     Excluding Non-Operating Items and     Amortization of Intangibles)	$	27,853		$	0.38	$	21,358		$	0.29	$	23,922		$	0.32
Average Common Shares Outstanding, Diluted		73,605,752					74,397,091					75,244,968
Select Balance Sheet (Averages)
Total assets	$	14,022,518				$	14,093,079				$	14,148,054
Intangible assets		(680,526	)				(682,584	)				(684,626	)
Tangible assets		13,341,992					13,410,495					13,463,428
Shareholders’ equity		1,519,488					1,546,392					1,551,769
Intangible assets		(680,526	)				(682,584	)				(684,626	)
Tangible equity		838,962					863,808					867,143
Return on Average Assets
GAAP earnings		0.73	%				0.51	%				0.59	%
Operating earnings		0.75					0.57					0.65
Cash operating earnings on average tangible assets		0.83					0.64					0.72
Return on Average Equity
GAAP earnings		6.75					4.65					5.36
Operating earnings		6.93					5.17					5.91
Cash operating earnings on average tangible equity		13.17					9.92					11.19

14

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands, except share data) (unaudited)

	Three Months Ended
	12/31/06					9/30/06					6/30/06					3/31/06
				Diluted EPS					Diluted EPS					Diluted EPS					Diluted EPS
Net Income, as Reported (GAAP)(1)	$	23,551		$	0.31	$	32,165		$	0.43	$	29,343		$	0.39	$	27,807		$	0.37
Non-Operating Items
Loss (gain) on securities		239					—					(3,601	)				(675	)
Gain on disposition of assets and     liabilities		—					(2,498	)				—					—
Loss on sale of indirect auto loans     previously HFI		—					—					3,477					—
Employment contract buyouts		4,990					—					—					598
Loss on early extinguishment of debt		821					—					—					—
Related income taxes		(1,952	)				767					42					27
Operating Earnings (Net Income,     Excluding Non-Operating Items)(1)		27,649			0.37		30,434			0.40		29,261			0.39		27,757			0.37
Amortization of intangibles		2,156					2,204					2,208					2,207
Related income taxes		(279	)				(677	)				(755	)				(763	)
Cash Operating Earnings (Net Income,     Excluding Non-Operating Items and     Amortization of Intangibles)	$	29,526		$	0.39	$	31,961		$	0.42	$	30,714		$	0.41	$	29,201		$	0.39
Average Common Shares     Outstanding, Diluted		75,701,120					75,590,748					75,504,683					75,339,283
Select Balance Sheet (Averages)
Total assets	$	14,130,681				$	13,973,708				$	14,344,435				$	14,367,256
Intangible assets		(686,393	)				(688,493	)				(690,375	)				(691,262	)
Tangible assets		13,444,288					13,285,215					13,654,060					13,675,994
Shareholders’ equity		1,559,088					1,501,105					1,476,234					1,487,996
Intangible assets		(686,393	)				(688,493	)				(690,375	)				(691,262	)
Tangible equity		872,695					812,612					785,859					796,734
Return on Average Assets
GAAP earnings		0.66	%				0.91	%				0.82	%				0.78	%
Operating earnings		0.78					0.86					0.82					0.78
Cash operating earnings on average     tangible assets		0.87					0.95					0.90					0.87
Return on Average Equity
GAAP earnings		5.99					8.50					7.97					7.58
Operating earnings		7.04					8.04					7.95					7.57
Cash operating earnings on average    tangible equity		13.42					15.60					15.68					14.86

⁽¹⁾ Net income and operating earnings for fourth quarter 2006 included a $5.2 million income tax benefit, or $0.07 per diluted share, related to favorable income tax settlements.

15

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands, except share data) (unaudited)

	Years Ended December 31,
	2006					2005
				Diluted EPS					Diluted EPS
Net Income, as Reported (GAAP)	$	112,866		$	1.49	$	69,821		$	0.94
Non-Operating Items
Change in fair value of interest rate swaps		—					13,278
(Gain) loss on securities		(4,037	)				52,139
Gain on disposition of assets and liabilities		(2,498	)				—
Loss on sale of indirect auto loans previously HFI		3,477					—
Employment contract buyouts		5,588					10,327
Impairment loss from write-down of assets		—					917
Merger-related costs		—					4,009
Loss on early extinguishment of debt		821					7,101
Charitable contribution to foundation		—					683
Related income taxes		(1,116	)				(32,541	)
Discontinued operations, net of income tax		—					396
Operating Earnings (Net Income, Excluding    Non-Operating Items)		115,101			1.52		126,130			1.69
Amortization of intangibles		8,775					8,637
Related income taxes		(2,474	)				(2,698	)
Cash Operating Earnings (Net Income,    Excluding Non-Operating Items and    Amortization of Intangibles)	$	121,402		$	1.61	$	132,069		$	1.77
Average Common Shares Outstanding, Diluted		75,542,848					74,594,626
Select Balance Sheet (Averages)
Total assets	$	14,202,649				$	14,752,973
Intangible assets		(689,116	)				(663,274	)
Tangible assets		13,513,533					14,089,699
Shareholders’ equity		1,506,195					1,463,125
Intangible assets		(689,116	)				(663,274	)
Tangible equity		817,079					799,851
Return on Average Assets
GAAP earnings		0.79	%				0.47	%
Operating earnings		0.81					0.85
Cash operating earnings on average tangible assets		0.90					0.94
Return on Average Equity
GAAP earnings		7.49					4.77
Operating earnings		7.64					8.62
Cash operating earnings on average tangible equity		14.86					16.51

16

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands, except share data) (unaudited)

	Three Months Ended
	9/30/07			6/30/07			3/31/07
Select Financial Data Used in Ratios Calculated Below
Net interest income	$	96,774		$	96,521		$	94,538
Tax-equivalent adjustment		1,538			1,555			1,641
Net interest income (tax-equivalent)	$	98,312		$	98,076		$	96,179
Total noninterest income, as reported (GAAP)	$	30,773		$	28,508		$	27,824
Adjustments for non-operating items:
(Gain) loss on securities		(287	)		2,237			1,385
Operating noninterest income (noninterest income, excluding    non-operating items)	$	30,486		$	30,745		$	29,209
Total noninterest expenses, as reported (GAAP)	$	79,595		$	80,976		$	82,331
Adjustments for non-operating items:
Employment contract buyouts and severance		—			(546	)		(1,760	)
Loss on early extinguishment of debt		(1,299	)		(231	)		—
Operating noninterest expenses (noninterest expenses, excluding    non-operating items)		78,296			80,199			80,571
Less: amortization of intangibles		(1,907	)		(2,136	)		(2,001	)
Cash operating noninterest expenses (noninterest expenses,    excluding non-operating items and amortization of    intangibles)	$	76,389		$	78,063		$	78,570
Total Revenue(1)
GAAP	$	127,547		$	125,029		$	122,362
Operating(2)		128,798			128,821			125,388
Noninterest Income as a % of Total Revenue(3)
GAAP		24.13	%		22.80	%		22.74	%
Operating(2)		23.67			23.87			23.29
Efficiency Ratios(4)
GAAP		62.40			64.77			67.28
Operating(2)		60.79			62.26			64.26
Cash operating(2)		59.31			60.60			62.66

(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.

17

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands) (unaudited)

	Three Months Ended
	12/31/06			9/30/06			6/30/06			3/31/06
Select Financial Data Used in Ratios Calculated Below
Net interest income	$	96,654		$	98,683		$	103,122		$	102,912
Tax-equivalent adjustment		1,683			1,691			1,728			1,801
Net interest income (tax-equivalent)	$	98,337		$	100,374		$	104,850		$	104,713
Total noninterest income, as reported (GAAP)	$	30,257		$	35,082		$	29,342		$	27,155
Adjustments for non-operating items:
Loss (gain) on securities		239			—			(3,601	)		(675	)
Gain on disposition of assets and liabilities		—			(2,498	)		—			—
Loss on sale of indirect auto loans previously HFI		—			—			3,477			—
Operating noninterest income (noninterest income,   excluding non-operating items)	$	30,496		$	32,584		$	29,218		$	26,480
Total noninterest expenses, as reported (GAAP)	$	91,022		$	80,798		$	80,381		$	77,669
Adjustments for non-operating items:
Employment contract buyouts		(4,990	)		—			—			(598	)
Loss on early extinguishment of debt		(821	)		—			—			—
Operating noninterest expenses (noninterest expenses,    excluding non-operating items)		85,211			80,798			80,381			77,071
Less: amortization of intangibles		(2,156	)		(2,204	)		(2,208	)		(2,207	)
Cash operating noninterest expenses (noninterest    expenses, excluding non-operating items and    amortization of intangibles)	$	83,055		$	78,594		$	78,173		$	74,864
Total Revenue(1)
GAAP	$	126,911		$	133,765		$	132,464		$	130,067
Operating(2)		128,833			132,958			134,068			131,193
Noninterest Income as a % of Total Revenue(3)
GAAP		23.84	%		26.23	%		22.15	%		20.88	%
Operating(2)		23.67			24.51			21.79			20.18
Efficiency Ratios(4)
GAAP		71.72			60.40			60.68			59.71
Operating(2)		66.14			60.77			59.96			58.75
Cash operating(2)		64.47			59.11			58.31			57.06

(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.

18

THE SOUTH FINANCIAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(dollars in thousands) (unaudited)

	Years Ended December 31,
	2006			2005			2004			2003			2002
Select Financial Data Used in Ratios     Calculated Below
Net interest income	$	401,371		$	409,056		$	335,841		$	250,890		$	210,143
Tax-equivalent adjustment		6,903			6,054			4,356			2,681			2,352
Net interest income (tax-equivalent)		408,274			415,110			340,197			253,571			212,495
Net cash settlement of certain interest rate        swaps included in noninterest income		—			10,360			27,560			19,486			7,396
Net interest income (tax-equivalent),      including net cash settlement of      certain interest rate swaps	$	408,274		$	425,470		$	367,757		$	273,057		$	219,891
Net interest margin (tax-equivalent)		3.22	%		3.12	%		3.06	%		3.01	%		3.59	%
Net interest margin (tax-equivalent),    including net cash  settlement of    certain interest rate swaps		3.22			3.20			3.31			3.24			3.71
Total noninterest income, as reported (GAAP)	$	121,836		$	47,267		$	118,066		$	95,117		$	69,796
Adjustments for non-operating items:
Change in fair value of interest rate swaps		—			13,278			(2,550	)		14,237			(7,527	)
(Gain) loss on securities		(4,037	)		52,139			(11,721	)		(16,456	)		(6,120	)
Impairment of perpetual preferred stock		—			—			10,367			—			—
Gain on disposition of assets and liabilities		(2,498	)		—			(2,350	)		(601	)		—
Loss on sale of indirect auto loans       previously HFI		3,477			—			—			—			—
Operating noninterest income (noninterest    income, excluding non-operating items)		118,778			112,684			111,812			92,297			56,149
Net cash settlement of certain interest rate        swaps included in noninterest income		—			10,360			27,560			19,486			7,396
Operating noninterest income, excluding net    cash settlement of certain interest rate swaps	$	118,778		$	102,324		$	84,252		$	72,811		$	48,753
Total noninterest expenses, as reported (GAAP)	$	329,870		$	320,110		$	243,433		$	201,548		$	158,073
Adjustments for non-operating items:
Employment contract buyouts		(5,588	)		(10,327	)		(1,080	)		(512	)		(1,846	)
Merger-related costs		—			(4,009	)		(7,866	)		(5,127	)		(6,664	)
Impairment recovery (loss) from write-down       of assets		—			(917	)		277			(268	)		(1,449	)
Conservation grant of land		—			—			(3,350	)		—			—
Loss on early extinguishment of debt		(821	)		(7,101	)		(1,429	)		(2,699	)		(354	)
Charitable contribution to foundation		—			(683	)		—			—			—
Operating noninterest expenses (noninterest    expenses, excluding non-operating items)		323,461			297,073			229,985			192,942			147,760
Less: amortization of intangibles		(8,775	)		(8,637	)		(6,043	)		(3,433	)		(1,519	)
Cash operating noninterest expenses    (noninterest expenses, excluding    non-operating items and amortization of    intangibles)	$	314,686		$	288,436		$	223,942		$	189,509		$	146,241
Total Revenue(1)
GAAP	$	523,207		$	456,323		$	453,907		$	346,007		$	279,939
Operating(2)		527,052			527,794			452,009			345,868			268,644
Noninterest Income as a % of Total Revenue(3)
GAAP		23.29	%		10.36	%		26.01	%		27.49	%		24.93	%
Operating(2)		22.54			21.35			24.74			26.69			20.90
Operating, excluding net cash settlement of    certain interest rate swaps(4)		22.54			19.39			18.64			21.05			18.15
Efficiency Ratios(5)
GAAP		63.05			70.15			53.63			58.25			56.47
Operating(2)		61.37			56.29			50.88			55.78			55.00
Cash operating(2)		59.71			54.65			49.54			54.79			54.44

(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 excluding the net cash settlement of certain interest rate swaps.
(5)	Calculated as noninterest expenses, divided by the sum of net interest income and noninterest income.

19