United Community Banks (UCB) 8-K Results of Operations and Financial Condition

Exhibit 99.1

For Immediate Release

For more information:
Rex S. Schuette
Chief Financial Officer
(706) 781-2266
Rex_Schuette@ucbi.com

UNITED COMMUNITY BANKS, INC. REPORTS
DILUTED OPERATING EARNINGS PER SHARE OF 13 CENTS
FOR FOURTH QUARTER 2007

HIGHLIGHTS:

• Fourth Quarter Operating Earnings

o Diluted operating earnings per share of 13 cents, lowered significantly by $26.5 million provision for loan losses

o Non-performing assets slightly above third quarter level

BLAIRSVILLE, GA, January 23, 2008 – United Community Banks, Inc. (NASDAQ: UCBI) today announced diluted operating earnings per share of 13 cents for the fourth quarter of 2007, compared to 44 cents for the fourth quarter of 2006. Total revenue on a taxable equivalent basis was $59.3 million for the quarter, compared to $72.1 million for the fourth quarter of 2006. These decreases reflect a higher provision for loan losses in the fourth quarter of 2007 and reflect a more challenging credit environment.

Net operating income was $6.0 million, compared with $18.4 million in the fourth quarter of 2006. Operating return on tangible equity was 5.06 percent and operating return on assets was .29 percent for the fourth quarter of 2007, compared with 17.49 percent and 1.10 percent a year ago, respectively.

“The residential housing market continued to weaken in the fourth quarter, making it one of the most challenging quarters we have faced in recent years,” said Jimmy Tallent, president and chief executive officer. “In response to the difficult operating environment, we worked aggressively to move non-performing loans and assets out of the bank, taking charge-offs and write downs when necessary.”

For the full year, diluted operating earnings per share was $1.48, compared with $1.66 for 2006. Taxable equivalent operating revenue was up 10 percent to $299.5 million versus $272.4 million for 2006, despite the increase in the provision for loan losses. Net operating income for 2007 was $69.0 million compared with $68.8 million for 2006.

Earnings measures for the fourth quarter and full year of 2007 are presented on an operating basis that excludes a second quarter $15 million special provision for loan losses related to two failed residential real estate developments near Spruce Pine, North Carolina. An additional $3 million special provision for loan losses related to these developments was recorded in the fourth quarter of 2007, bringing the total for the year to $18 million. Because the provision was the result of a fraud-related matter that is considered isolated and non-recurring, management believes the presentation of operating earnings is useful for understanding underlying core earnings and credit trends.

Loans were up $553 million from the end of 2006, due primarily to loans added through the acquisition of First Bank of the South in the second quarter. Excluding acquisitions, loans were flat year-over-year. “In 2007, residential construction loan growth slowed substantially due to the weak housing market, particularly in the Atlanta region,” Tallent said. “The weak housing market reduced our ability to grow and we expect that this slower-than-normal loan growth will continue until the market stabilizes. In fact, on a linked-quarter basis residential construction loans were down $110 million. However, on the positive side, we saw $90 million loan growth in the commercial and residential mortgage portfolios. So we are getting growth across our markets, but this growth is more than offset by construction paydowns. To enhance the growth and diversity of our loan portfolio, we are actively exploring opportunities to add commercial

lending expertise and to expand small business lending. We are targeting core loan growth for 2008 to be flat to 4 percent, but expect to be at the low end of that range for the first half.”

Deposits increased $303 million, or 5 percent, from a year ago due to the acquisition of First Bank of the South. “Total deposits, excluding acquired deposits, decreased by $265 million from the prior year as we let non-relationship time deposits run off in view of declining loan demand,” commented Tallent. “Excluding these time deposits, customer deposits were up $25 million from the prior year, but down $77 million from the third quarter.”

“We believe the fourth quarter decline was temporary and directly related to the current economic environment,” said Tallent. “The number of customer relationships continues to increase and our customer satisfaction scores remain at historical highs. In fact, in November we hit a record high of 95.3 percent, proof that our bankers remain focused on the all-important business of taking excellent care of customers.”

For the fourth quarter 2007, taxable equivalent net interest revenue of $69.7 million reflected an increase of $7.2 million, or 11 percent, from the fourth quarter of 2006. The full year increase was $36.6 million, or 15 percent, compared to 2006. Taxable equivalent net interest margin was 3.73 percent for the fourth quarter, compared with 3.89 percent for the third quarter of 2007 and 3.99 percent for the fourth quarter of 2006. “Our net interest margin continues to be under pressure due to very competitive CD pricing, the higher level of non-performing assets, and a slight change in the mix of earning assets,” stated Tallent. “With the Federal Reserve’s rate cut yesterday and the outlook for the continued easing of rates, we expect to see these margin pressures continue into 2008. If liquidity pressures continue to keep an imbalance on our CD pricing, we expect to see further margin compression in the first quarter.”

The fourth quarter provision for loan losses was $29.5 million, including a $3 million special provision for the Spruce Pine developments in North Carolina. This compared with provisions of $3.7 million in both the fourth quarter of 2006 and third quarter of 2007. Net charge-offs were $31.0 million, including $18 million related to the Spruce Pine loans, compared with $5.2 million for the third quarter and $1.9 million a year ago. Annualized net charge-offs to average

loans, excluding Spruce Pine, was 87 basis points for the fourth quarter compared to 35 basis points for the third quarter and 15 basis points for the fourth quarter of 2006.

“The increase in the fourth quarter provision was due to management’s decision to deal with problem credits assertively,” Tallent said. “In the fourth quarter, we charged down non-performing loans aggressively, enabling us to reduce the level of total non-performing assets below the third quarter level. The higher provision increased our allowance-to-loans ratio to 1.51 percent. We believe that our actions in the fourth quarter better position us to manage what we expect to be a challenging 2008.”

At year-end, non-performing assets totaled $46.3 million, compared with $63.3 million at September 30, 2007 and $13.7 million at December 31, 2006. The remaining balance of fraud-related assets for Spruce Pine was $5.3 million, compared with $23.6 million at September 30, 2007. Excluding Spruce Pine, non-performing assets were $41.0 million at year-end compared with $39.8 million at September 30, 2007 and $13.7 million a year ago and as a percentage of total assets was 50 basis points, 49 basis points, and 19 basis points, respectively. The Spruce Pine non-performing assets, as a percentage of total assets, was six basis points at December 31, 2007 and 28 basis points at September 30, 2007. “We continued negotiations related to Spruce Pine during the fourth quarter and have been in contact with all of the borrowers or their counsel,” commented Tallent. “Even though we charged-off these loans, we will seek full recovery, and in the past 30 days, we have reached settlement with several borrowers.”

“Non-performing assets, until recently, were at very low levels and at the lower end of our historic 20 to 35 basis point range,” Tallent said. “During the past two quarters, excluding the Spruce Pine loans, non-performing assets increased above this range to 50 basis points. Most of the rise was construction-related due to softening in the residential housing market. We continue to see a buildup of lot inventory in the Atlanta region and a standstill in new construction lending. We don’t know the length of this current cycle, but we expect several quarters will pass before we return to our historical range for non-performing assets.”

Fee revenue of $16.1 million for the fourth quarter reflected an increase of $2.9 million, or 22 percent, from $13.2 million for the fourth quarter of 2006. Service charges and fees on deposit accounts of $8.4 million reflected an increase of $1.3 million, or 18 percent, from the fourth quarter of 2006 due to growth in transactions, new accounts and higher ATM and debit card usage. Consulting fees were $2.6 million – up $482,000, or 23 percent, from a year ago – surpassing the record level set last quarter and reflecting strong growth in the advisory services practice. Brokerage fees were up $411,000 to $1.1 million from a year ago due to strong retention rates and additional customers.

“During the fourth quarter, we took an opportunity to lower our funding costs by prepaying higher-rate Federal Home Loan Bank advances,” Tallent said. “The gain from the sale of securities more than offset the charges from the prepayment of the advances.” Other fee revenue of $2.1 million included $727,000 of earnings from bank-owned life insurance assets that were added in the second quarter of 2007.

Operating expenses of $49.3 million reflected an increase of $6.8 million, or 16 percent, from the fourth quarter of 2006. Salaries and employee benefit costs totaled $27.1 million, which was $592,000, or 2 percent, higher than the fourth quarter of 2006. Although acquisitions added approximately $1.5 million, this was more than offset by a reduction in bonus and profit sharing expense of $3.5 million. Occupancy expense increased $650,000 to $3.5 million due to the higher costs of operating additional banking offices. Professional fees increased $535,000 to $1.8 million, reflecting higher fees associated with loan work-outs, foreclosures and corporate initiatives. Other expenses of $8.8 million were $5.1 million higher than a year ago and included $3.7 million of write-downs and related costs on foreclosed properties and higher FDIC insurance premiums of $927,000.

“Our operating efficiency ratio of 57.67 percent for the fourth quarter was at the upper end of our long-term efficiency target range of 56 to 58 percent, primarily due to accelerated write-downs on foreclosed properties,” Tallent said. “Despite these challenges, we continue to maintain disciplined expense controls.”

“In the third quarter, the Board of Directors increased the level of our stock purchase program to three million shares, and we have purchased two million shares through December 2007,” noted Tallent. “Even though we believe our stock price is significantly undervalued, it is important to maintain a strong capital position during this difficult credit environment. At year-end, we continued to maintain strong capital ratios, with all of our regulatory capital ratios above the well-capitalized level and our tangible equity-to-asset ratio at 6.58 percent. To help maintain this, we will wait to evaluate any additional stock purchases until the second half of 2008.

“We remain committed to increasing long-term shareholder value by delivering solid growth in earnings per share, building our franchise and providing superior customer service,” said Tallent. “These are very challenging times for financial institutions, and our outlook for 2008 will be tempered by these challenges. Given the uncertainty and volatility in both the housing market and broader economy, we do not have a clear enough view to provide guidance beyond the first quarter. Based on these assumptions and continued growth in the economy, we expect core annualized loan growth for the quarter to be flat. We expect margin compression to continue, net charge-offs to be $5 million to $7 million, and operating earnings per share to be 34 to 38 cents.”

“We remain focused on the solid business model and guiding principles that have resulted in our past achievements,” Tallent concluded. “We will continue to provide unparalleled customer service in our markets and are optimistic about the stability and long-term growth this will bring.”

Conference Call

United Community Banks will hold a conference call on Wednesday, January 23, 2008, at 11 a.m. ET to discuss the contents of this news release, as well as business highlights for the quarter and the financial outlook for 2008. The telephone number for the conference call is (888) 262-8720 and the pass code is “UCBI.” The conference call will also be available by web cast within the Investor Relations section of the company’s web site at www.ucbi.com.

About United Community Banks, Inc.

Headquartered in Blairsville, United Community Banks is the third-largest bank holding company in Georgia. United Community Banks has assets of $8.2 billion and operates 27 community banks with 111 banking offices located throughout north Georgia, the Atlanta region, coastal Georgia, western North Carolina and east Tennessee. The company specializes in providing personalized community banking services to individuals and small to mid-size businesses. United Community Banks also offers the convenience of 24-hour access through a network of ATMs, telephone and on-line banking. United Community Banks common stock is listed on the Nasdaq Global Select Market under the symbol UCBI. Additional information may be found at the company’s web site at www.ucbi.com.

Safe Harbor

This news release contains forward-looking statements, as defined by Federal Securities Laws, including statements about financial outlook and business environment. These statements are provided to assist in the understanding of future financial performance and such performance involves risks and uncertainties that may cause actual results to differ materially from those in such statements. Any such statements are based on current expectations and involve a number of risks and uncertainties. For a discussion of some factors that may cause such forward-looking statements to differ materially from actual results, please refer to the section entitled “Forward-Looking Statements” on page 4 of United Community Banks, Inc.’s annual report filed on Form 10-K with the Securities and Exchange Commission.

(Tables Follow)

UNITED COMMUNITY BANKS, INC.

Financial Highlights

Selected Financial Information

																Fourth
	2007												2006			Quarter			For the Twelve						YTD
(in thousands, except per share	Fourth			Third			Second			First			Fourth			2007-2006			Months Ended						2007-2006
data; taxable equivalent)	Quarter			Quarter			Quarter			Quarter			Quarter			Change			2007			2006			Change
INCOME SUMMARY
Interest revenue	$	140,768		$	144,884		$	136,237		$	129,028		$	123,463					$	550,917		$	446,695
Interest expense		71,038			73,203			68,270			63,923			60,912						276,434			208,815
Net interest revenue		69,730			71,681			67,967			65,105			62,551			11	%		274,483			237,880			15	%
Provision for loan losses (1)		26,500			3,700			3,700			3,700			3,700						37,600			14,600
Fee revenue		16,100			15,615			16,554			14,382			13,215			22			62,651			49,095			28
Total operating revenue		59,330			83,596			80,821			75,787			72,066			(18	)		299,534			272,375			10
Operating expenses		49,336			48,182			47,702			44,841			42,521			16			190,061			162,070			17
Income before taxes		9,994			35,414			33,119			30,946			29,545			(66	)		109,473			110,305			(1	)
Income taxes		3,960			12,878			12,043			11,601			11,111						40,482			41,490
Net operating income		6,034			22,536			21,076			19,345			18,434			(67	)		68,991			68,815			—
Fraud loss provision, net of tax (1)		1,833			—			9,165			—			—						10,998			—
Net income	$	4,201		$	22,536		$	11,911		$	19,345		$	18,434			(77	)	$	57,993		$	68,815			(16	)
OPERATING PERFORMANCE (1)
Earnings per common share:
Basic	$	.13		$	.47		$	.47		$	.45		$	.45			(71	)	$	1.50		$	1.70			(12	)
Diluted		.13			.46			.46			.44			.44			(70	)		1.48			1.66			(11	)
Return on tangible equity (2)(3)(4)		5.06	%		17.54	%		17.52	%		17.18	%		17.49	%					14.23	%		17.52	%
Return on assets (4)		.29			1.11			1.12			1.11			1.10						.89			1.09
Dividend payout ratio		69.23			19.15			19.15			20.00			17.78						24.00			18.82
GAAP PERFORMANCE MEASURES
Per common share:
Basic earnings	$	.09		$	.47		$	.26		$	.45		$	.45			(80	)	$	1.26		$	1.70			(26	)
Diluted earnings		.09			.46			.26			.44			.44			(80	)		1.24			1.66			(25	)
Cash dividends declared		.09			.09			.09			.09			.08			13			.36			.32			13
Book value		17.73			17.53			16.98			14.83			14.37			23			17.73			14.37			23
Tangible book value (3)		10.94			10.82			10.44			11.06			10.57			4			10.94			10.57			4
Key performance ratios:
Return on equity (2)(4)		2.01	%		10.66	%		7.05	%		12.47	%		13.26	%					7.79	%		13.28	%
Return on assets (4)		.20			1.11			.64			1.11			1.10						.75			1.09
Net interest margin (4)		3.73			3.89			3.94			3.99			3.99						3.88			4.05
Efficiency ratio		57.67			55.34			56.59			56.56			55.93						56.53			56.22
Dividend payout ratio		100.00			19.15			34.62			20.00			17.78						28.57			18.82
Equity to assets		10.20			10.32			8.94			8.80			8.21						9.61			8.06
Tangible equity to assets (3)		6.58			6.65			6.65			6.66			6.46						6.63			6.32
ASSET QUALITY
Allowance for loan losses	$	89,423		$	90,935		$	92,471		$	68,804		$	66,566					$	89,423		$	66,566
Non-performing assets		46,258			63,337			43,601			14,290			13,654						46,258			13,654
Net charge-offs		31,012			5,236			2,124			1,462			1,930						39,834			5,524
Allowance for loan losses to loans		1.51	%		1.53	%		1.54	%		1.27	%		1.24	%					1.51	%		1.24	%
Non-performing assets to total assets		.56			.77			.54			.20			.19						.56			.19
Net charge-offs to average loans (4)		2.07			.35			.15			.11			.15						.69			.12
AVERAGE BALANCES
Loans	$	5,940,230		$	5,966,933		$	5,619,950		$	5,402,860		$	5,134,721			16		$	5,734,608		$	4,800,981			19
Investment securities		1,404,796			1,308,192			1,242,448			1,153,208			1,059,125			33			1,277,935			1,041,897			23
Earning assets		7,424,992			7,332,492			6,915,134			6,599,035			6,225,943			19			7,070,900			5,877,483			20
Total assets		8,210,120			8,083,739			7,519,392			7,092,710			6,669,950			23			7,730,530			6,287,148			23
Deposits		6,151,476			6,246,319			5,945,633			5,764,426			5,517,696			11			6,028,625			5,017,435			20
Shareholders’ equity		837,195			834,094			672,348			624,100			547,419			53			742,771			506,946			47
Common shares - basic		47,203			48,348			44,949			43,000			41,096						45,893			40,393
Common shares - diluted		47,652			48,977			45,761			43,912			42,311						46,593			41,575
AT PERIOD END
Loans	$	5,929,263		$	5,952,749		$	5,999,093		$	5,402,198		$	5,376,538			10		$	5,929,263		$	5,376,538			10
Investment securities		1,356,846			1,296,826			1,213,659			1,150,424			1,107,153			23			1,356,846			1,107,153			23
Total assets		8,207,302			8,180,600			8,087,667			7,186,602			7,101,249			16			8,207,302			7,101,249			16
Deposits		6,075,951			6,154,308			6,361,269			5,841,687			5,772,886			5			6,075,951			5,772,886			5
Shareholders’ equity		831,902			833,761			828,731			638,456			616,767			35			831,902			616,767			35
Common shares outstanding		46,903			47,542			48,781			43,038			42,891						46,903			42,891

(1)	Excludes effect of special $15 million fraud related provision for loan losses recorded in the second quarter of 2007 and an additional $3 million in the fourth quarter of 2007.
(2)	Net income available to common shareholders, which excludes preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss).
(3)	Excludes effect of acquisition related intangibles and associated amortization.
(4)	Annualized.

UNITED COMMUNITY BANKS, INC.
Selected Financial Information
For the Years Ended December 31,

(in thousands, except per share data;																			5 Year
taxable equivalent)	2007			2006			2005			2004			2003			2002			CAGR(4)
INCOME SUMMARY
Interest revenue	$	550,917		$	446,695		$	324,225		$	227,792		$	198,689		$	185,498
Interest expense		276,434			208,815			127,426			74,794			70,600			76,357
Net interest revenue		274,483			237,880			196,799			152,998			128,089			109,141			20	%
Provision for loan losses		37,600			14,600			12,100			7,600			6,300			6,900
Fee revenue		62,651			49,095			46,148			39,539			38,184			30,734			15
Total revenue		299,534			272,375			230,847			184,937			159,973			132,975			18
Operating expenses(1)		190,061			162,070			140,808			110,974			97,251			80,690			19
Income before taxes		109,473			110,305			90,039			73,963			62,722			52,285			16
Income taxes		40,482			41,490			33,297			26,807			23,247			19,505
Net operating income		68,991			68,815			56,742			47,156			39,475			32,780			16
Fraud loss provision, net of tax		10,998			—			—			—			—			—
Merger-related charges, net of tax		—			—			—			565			1,357			—
Net income	$	57,993		$	68,815		$	56,742		$	46,591		$	38,118		$	32,780			12
OPERATING PERFORMANCE(1)
Earnings per common share:
Basic	$	1.50		$	1.70		$	1.47		$	1.31		$	1.15		$	1.02			8
Diluted		1.48			1.66			1.43			1.27			1.12			.99			8
Return on tangible equity(2)(3)		14.23	%		17.52	%		18.99	%		19.74	%		19.24	%		17.88	%
Return on assets		.89			1.09			1.04			1.07			1.06			1.11
Efficiency ratio		56.53			56.35			57.77			57.65			58.39			57.72
Dividend payout ratio		24.00			18.82			19.05			18.32			17.39			16.34
GAAP PERFORMANCE
Per common share:
Basic earnings	$	1.26		$	1.70		$	1.47		$	1.29		$	1.11		$	1.02			4
Diluted earnings		1.24			1.66			1.43			1.25			1.08			.99			5
Cash dividends declared (rounded)		.36			.32			.28			.24			.20			.17			17
Book value		17.73			14.37			11.80			10.39			8.47			6.89			21
Tangible book value (3)		10.94			10.57			8.94			7.34			6.52			6.49			11
Key performance ratios:
Return on equity(2)		7.79	%		13.28	%		13.46	%		14.39	%		14.79	%		16.54	%
Return on assets		.75			1.09			1.04			1.05			1.02			1.11
Net interest margin		3.88			4.05			3.85			3.71			3.68			3.95
Dividend payout ratio		28.57			18.82			19.05			18.60			18.02			16.34
Equity to assets		9.61			8.06			7.63			7.45			7.21			7.01
Tangible equity to assets(3)		6.63			6.32			5.64			5.78			6.02			6.60
ASSET QUALITY
Allowance for loan losses	$	89,423		$	66,566		$	53,595		$	47,196		$	38,655		$	30,914
Non-performing assets		46,258			13,654			12,995			8,725			7,589			8,019
Net charge-offs		39,834			5,524			5,701			3,617			4,097			3,111
Allowance for loan losses to loans		1.51	%		1.24	%		1.22	%		1.26	%		1.28	%		1.30	%
Non-performing assets to total assets		.56			.19			.22			.17			.19			.25
Net charge-offs to average loans		.69			.12			.14			.11			.15			.14
AVERAGE BALANCES
Loans	$	5,734,608		$	4,800,981		$	4,061,091		$	3,322,916		$	2,753,451		$	2,239,875			21
Investment securities		1,277,935			1,041,897			989,201			734,577			667,211			464,468			22
Earning assets		7,070,900			5,877,483			5,109,053			4,119,327			3,476,030			2,761,265			21
Total assets		7,730,530			6,287,148			5,472,200			4,416,835			3,721,284			2,959,295			21
Deposits		6,028,625			5,017,435			4,003,084			3,247,612			2,743,087			2,311,717			21
Shareholders’ equity		742,771			506,946			417,309			329,225			268,446			207,312			29
Common shares — Basic		45,893			40,393			38,477			36,071			34,132			32,062
Common shares — Diluted		46,593			41,575			39,721			37,273			35,252			33,241
AT YEAR END
Loans	$	5,929,263		$	5,376,538		$	4,398,286		$	3,734,905		$	3,015,997		$	2,381,798			20
Investment securities		1,356,846			1,107,153			990,687			879,978			659,891			559,390			19
Total assets		8,207,302			7,101,249			5,865,756			5,087,702			4,068,834			3,211,344			21
Deposits		6,075,951			5,772,886			4,477,600			3,680,516			2,857,449			2,385,239			21
Shareholders’ equity		831,902			616,767			472,686			397,088			299,373			221,579			30
Common shares outstanding		46,903			42,891			40,020			38,168			35,289			31,895			8

(1)	Excludes pre-tax provision for fraud losses of $18 million, or $.24 per diluted common share, recorded in 2007 and pre-tax merger-related charges totaling $.9 million, or $.02 per diluted common share, recorded in 2004 and $2.1 million, or $.04 per diluted common share, recorded in 2003.
(2)	Net income available to common stockholders, which excludes preferred stock dividends, divided by average realized common equity which excludes accumulated other comprehensive income (loss).
(3)	Excludes effect of acquisition related intangibles and associated amortization.
(4)	Compound annual growth rate.

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End

					��
												Linked
												Quarter
	2007									2006		Change(2)			Year over Year Change
	Fourth		Third			Second		First		Fourth								Excluding
(in millions)	Quarter		Quarter			Quarter(1)		Quarter		Quarter		Actual			Actual			Acquired
LOANS BY CATEGORY
Commercial (sec. by RE)	$	1,476	$	1,441		$	1,461	$	1,227	$	1,230		10	%		20	%		3	%
Commercial construction		527		527			509		462		470		—			12			7
Commercial & industrial		418		408			421		315		296		10			41			4
Total commercial		2,421		2,376			2,391		2,004		1,996		8			21			4
Residential construction		1,829		1,939			2,013		1,874		1,864		(23	)		(2	)		(11	)
Residential mortgage		1,502		1,459			1,413		1,353		1,338		12			12			11
Consumer / installment		177		179			182		171		179		(4	)		(1	)		(6	)
Total loans	$	5,929	$	5,953		$	5,999	$	5,402	$	5,377		(2	)		10			—
LOANS BY MARKET
Atlanta Region	$	2,402	$	2,451		$	2,518	$	2,015	$	2,005		(8)	%		20	%		(7)	%
North Georgia		2,060		2,026			2,032		2,010		2,034		7			1			1
Western North Carolina		806		834			816		782		773		(13	)		4			4
Coastal Georgia		415		402			396		372		358		13			16			16
East Tennessee		246		240			237		223		207		10			19			19
Total loans	$	5,929	$	5,953		$	5,999	$	5,402	$	5,377		(2	)		10			—
RESIDENTIAL CONSTRUCTION
Dirt loans
Acquisition & development	$	592	$	596		$	602	$	580	$	579		(3)	%		2	%		(6)	%
Land loans		126		125			113		122		127		3			(1	)		(3	)
Lot loans		407		403			393		362		364		4			12			5
Total		1,125		1,124			1,108		1,064		1,070		—			5			(2	)
House loans
Spec		473		539			596		533		516		(49	)		(8	)		(21	)
Sold		231		276			309		277		278		(65	)		(17	)		(28	)
Total		704		815			905		810		794		(54	)		(11	)		(23	)
Total residential construction	$	1,829	$	1,939		$	2,013	$	1,874	$	1,864		(23	)		(2	)		(11	)
RESIDENTIAL CONSTRUCTION — ATLANTA REGION
Dirt loans
Acquisition & development	$	311	$	312		$	336	$	317	$	321		(1)	%		(3)	%		(18)	%
Land loans		54		53			50		52		57		8			(5	)		(11	)
Lot loans		131		135			140		113		109		(12	)		20			(3	)
Total		496		500			526		482		487		(3	)		2			(14	)
House loans
Spec		286		328			378		298		297		(51	)		(4	)		(25	)
Sold		82		112			140		124		117		(107	)		(30	)		(57	)
Total		368		440			518		422		414		(65	)		(11	)		(34	)
Total residential construction	$	864	$	940		$	1,044	$	904	$	901		(32	)		(4	)		(23	)

(1)	Acquired Gwinnett Commercial Group on June 1, 2007 with total loans of $534 million in the Atlanta Region.
(2)	Annualized.

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Year-End

(in millions)	2007		2006		2005		2004		2003
LOANS BY CATEGORY
Commercial (sec. by RE)	$	1,476	$	1,230	$	1,055	$	966	$	777
Commercial construction		527		470		358		239		164
Commercial & industrial		418		296		237		212		190
Total commercial		2,421		1,996		1,650		1,417		1,131
Residential construction		1,829		1,864		1,381		1,066		763
Residential mortgage		1,502		1,338		1,206		1,102		982
Consumer / installment		177		179		161		150		140
Total loans	$	5,929	$	5,377	$	4,398	$	3,735	$	3,016
LOANS BY MARKET
Atlanta Region	$	2,402	$	2,005	$	1,456	$	1,061	$	662
North Georgia		2,060		2,034		1,790		1,627		1,481
Western North Carolina		806		773		668		633		548
Coastal Georgia		415		358		306		274		222
East Tennessee		246		207		178		140		103
Total loans	$	5,929	$	5,377	$	4,398	$	3,735	$	3,016

UNITED COMMUNITY BANKS, INC.
Operating Earnings to GAAP Earnings Reconciliation
(in thousands, except per share data)
                          

	Fourth			Third			Second
	Quarter			Quarter			Quarter			Years Ended December 31,
	2007			2007			2007			2007			2004			2003
Special provision for fraud related loan losses	$	3,000		$	—		$	15,000		$	18,000		$	—		$	—
Merger-related charges included in expenses:
Salaries and employee benefits — severance and related costs		—			—			—			—			203			135
Professional fees		—			—			—			—			407			885
Contract termination costs		—			—			—			—			119			566
Other merger-related expenses		—			—			—			—			141			502
Total merger-related charges		—			—			—			—			870			2,088
Pre-tax earnings impact of non-operating charges		3,000			—			15,000			18,000			870			2,088
Income tax effect of special provision		1,167			—			5,835			7,002			305			731
After-tax effect of special provision	$	1,833		$	—		$	9,165		$	10,998		$	565		$	1,357
Net Income Reconciliation
Operating net income	$	6,034		$	22,536		$	21,076		$	68,991		$	47,156		$	39,475
After-tax effect of special provision and merger-related charges		(1,833	)		—			(9,165	)		(10,998	)		(565	)		(1,357	)
Net income (GAAP)	$	4,201		$	22,536		$	11,911		$	57,993		$	46,591		$	38,118
Basic Earnings Per Share Reconciliation
Basic operating earnings per share	$	.13		$	.47		$	.47		$	1.50		$	1.31		$	1.15
Per share effect of special provision and merger-related charges		(.04	)		—			(.21	)		(.24	)		(.02	)		(.04	)
Basic earnings per share (GAAP)	$	.09		$	.47		$	.26		$	1.26		$	1.29		$	1.11
Diluted Earnings Per Share Reconciliation
Diluted operating earnings per share	$	.13		$	.46		$	.46		$	1.48		$	1.27		$	1.12
Per share effect of special provision and merger-related charges		(.04	)		—			(.20	)		(.24	)		(.02	)		(.04	)
Diluted earnings per share (GAAP)	$	.09		$	.46		$	.26		$	1.24		$	1.25		$	1.08
Provision for Loan Losses Reconciliation
Operating provision for loan losses	$	26,500		$	3,700		$	3,700		$	37,600		$	7,600		$	6,300
Special provision for fraud related loan losses		3,000			—			15,000			18,000			—			—
Provision for loan losses (GAAP)	$	29,500		$	3,700		$	18,700		$	55,600		$	7,600		$	6,300
Nonperforming Assets Reconciliation
Nonperforming assets excluding fraud-related assets	$	40,956		$	39,761		$	19,968		$	40,956		$	8,725		$	7,589
Fraud-related loans and OREO included in nonperforming assets		5,302			23,576			23,633			5,302			—			—
Nonperforming assets (GAAP)	$	46,258		$	63,337		$	43,601		$	46,258		$	8,725		$	7,589
Allowance for Loan Losses Reconciliation
Allowance for loan losses excluding special fraud-related allowance	$	89,423		$	75,935		$	77,471		$	89,423		$	47,196		$	38,655
Fraud-related allowance for loan losses		—			15,000			15,000			—			—			—
Allowance for loan losses (GAAP)	$	89,423		$	90,935		$	92,471		$	89,423		$	47,196		$	38,655
Net Charge Offs Reconciliation
Net charge offs excluding charge off of fraud-related loans	$	13,012		$	5,236		$	2,124		$	21,834		$	3,617		$	4,097
Fraud-related loans charged off		18,000			—			—			18,000			—			—
Net charge offs (GAAP)	$	31,012		$	5,236		$	2,124		$	39,834		$	3,617		$	4,097
Allowance for Loan Losses to Loans Ratio Reconciliation
Allowance for loan losses to loans ratio excluding fraud-related allowance		1.51	%		1.28	%		1.29	%		1.51	%		1.26	%		1.28	%
Portion of allowance assigned to fraud-related loans		—			.25			.25			—			—			—
Allowance for loan losses to loans ratio (GAAP)		1.51	%		1.53	%		1.54	%		1.51	%		1.26	%		1.28	%
Nonperforming Assets to Total Assets Ratio Reconciliation
Nonperforming assets to total assets ratio excluding fraud-related assets		.50	%		.49	%		.25	%		.50	%		.17	%		.19	%
Fraud-related nonperforming assets		.06			.28			.29			.06			—			—
Nonperforming assets to total assets ratio (GAAP)		.56	%		.77	%		.54	%		.56	%		.17	%		.19	%
Net Charge Offs to Average Loans Ratio Reconciliation
Net charge offs to average loans ratio excluding fraud-related loans		.87	%		.35	%		.15	%		.38	%		.11	%		.15	%
Charge offs of fraud-related loans		1.20			—			—			.31			—			—
Net charge offs to average loans ratio (GAAP)		2.07	%		.35	%		.15	%		.69	%		.11	%		.15	%
Operating Expenses Reconciliation
Operating expenses (operating basis)	$	49,336		$	47,702		$	47,702		$	190,061		$	110,974		$	97,251
Merger-related charges		—			—			—			—			870			2,088
Operating expenses (GAAP)	$	49,336		$	47,702		$	47,702		$	190,061		$	111,844		$	99,339

UNITED COMMUNITY BANKS, INC.

Consolidated Statement of Income

	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
(in thousands, except per share data)	2007			2006			2007			2006
Interest revenue:
Loans, including fees	$	121,248		$	109,869		$	482,333		$	394,907
Investment securities:
Taxable		18,296			12,488			64,377			47,149
Tax exempt		405			472			1,718			1,969
Federal funds sold and deposits in banks		336			117			608			802
Total interest revenue		140,285			122,946			549,036			444,827
Interest expense:
Deposits:
NOW		10,999			9,120			45,142			30,549
Money market		4,314			2,527			15,396			7,496
Savings		417			248			1,653			928
Time		40,934			40,645			167,400			130,324
Total deposit interest expense		56,664			52,540			229,591			169,297
Federal funds purchased, repurchase agreements and other short-term borrowings		6,010			1,505			16,236			7,319
Federal Home Loan Bank advances		6,275			4,677			22,013			23,514
Long-term debt		2,089			2,190			8,594			8,685
Total interest expense		71,038			60,912			276,434			208,815
Net interest revenue		69,247			62,034			272,602			236,012
Provision for loan losses		29,500			3,700			55,600			14,600
Net interest revenue after provision for loan losses		39,747			58,334			217,002			221,412
Fee revenue:
Service charges and fees		8,350			7,064			31,433			27,159
Mortgage loan and other related fees		1,720			2,154			8,537			7,303
Consulting fees		2,577			2,095			8,946			7,291
Brokerage fees		1,064			653			4,095			3,083
Securities gains (losses), net		1,364			(258	)		3,182			(643	)
Losses on prepayment of borrowings		(1,078	)		—			(2,242	)		(636	)
Other		2,103			1,507			8,700			5,538
Total fee revenue		16,100			13,215			62,651			49,095
Total revenue		55,847			71,549			279,653			270,507
Operating expenses:
Salaries and employee benefits		27,116			26,524			115,153			100,964
Communications and equipment		3,890			4,101			15,483			15,071
Occupancy		3,489			2,839			13,613			11,632
Advertising and public relations		1,873			1,905			7,524			7,623
Postage, printing and supplies		1,546			1,564			6,365			5,748
Professional fees		1,809			1,274			7,218			4,442
Amortization of intangibles		771			523			2,739			2,032
Other		8,842			3,791			21,966			14,558
Total operating expenses		49,336			42,521			190,061			162,070
Income before income taxes		6,511			29,028			89,592			108,437
Income taxes		2,310			10,594			31,599			39,622
Net income	$	4,201		$	18,434		$	57,993		$	68,815
Earnings per common share:
Basic	$	.09		$	.45		$	1.26		$	1.70
Diluted		.09			.44			1.24			1.66
Dividends per common share		.09			.08			.36			.32
Weighted average common shares outstanding:
Basic		47,203			41,096			45,893			40,393
Diluted		47,652			42,311			46,593			41,575

UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheet

	December 31,			December 31,
(in thousands, except share and per share data)	2007			2006
	(unaudited)			(unaudited)
ASSETS
Cash and due from banks	$	157,549		$	158,348
Interest-bearing deposits in banks		62,074			12,936
Cash and cash equivalents		219,623			171,284
Securities available for sale		1,356,846			1,107,153
Mortgage loans held for sale		28,004			35,325
Loans, net of unearned income		5,929,263			5,376,538
Less allowance for loan losses		89,423			66,566
Loans, net		5,839,840			5,309,972
Premises and equipment, net		180,088			139,716
Accrued interest receivable		62,828			58,291
Goodwill and other intangible assets		325,305			167,058
Other assets		194,768			112,450
Total assets	$	8,207,302		$	7,101,249
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Deposits:
Demand	$	700,941		$	659,892
NOW		1,474,818			1,307,654
Money market		452,917			255,862
Savings		186,392			175,631
Time:
Less than $100,000		1,573,604			1,650,906
Greater than $100,000		1,364,763			1,397,245
Brokered		322,516			325,696
Total deposits		6,075,951			5,772,886
Federal funds purchased, repurchase agreements and other short-term borrowings		638,462			65,884
Federal Home Loan Bank advances		519,782			489,084
Long-term debt		107,996			113,151
Accrued expenses and other liabilities		33,209			43,477
Total liabilities		7,375,400			6,484,482
Shareholders’ equity:
Preferred stock, $1 par value; $10 stated value; 10,000,000 shares authorized; 25,800 and 32,200 shares issued and outstanding		258			322
Common stock, $1 par value; 100,000,000 shares authorized; 48,809,301 and 42,890,863 shares issued		48,809			42,891
Common stock issuable; 73,250 and 29,821 shares		2,100			862
Capital surplus		462,881			270,383
Retained earnings		347,391			306,261
Treasury stock; 1,905,921 shares as of December 31, 2007, at cost		(43,798	)		—
Accumulated other comprehensive income (loss)		14,261			(3,952	)
Total shareholders’ equity		831,902			616,767
Total liabilities and shareholders’ equity	$	8,207,302		$	7,101,249

UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended December 31,

	2007								2006
	Average					Avg.			Average					Avg.
(dollars in thousands, taxable equivalent)	Balance			Interest		Rate			Balance			Interest		Rate
Assets:
Interest-earning assets:
Loans, net of unearned income (1)(2)	$	5,940,230		$	121,161		8.09	%	$	5,134,721		$	109,756		8.48	%
Taxable securities (3)		1,366,507			18,296		5.36			1,014,959			12,488		4.92
Tax-exempt securities (1) (3)		38,289			666		6.96			44,166			777		7.04
Federal funds sold and other interest-earning assets		79,966			645		3.23			32,097			442		5.51
Total interest-earning assets		7,424,992			140,768		7.53			6,225,943			123,463		7.87
Non-interest-earning assets:
Allowance for loan losses		(89,797	)							(64,301	)
Cash and due from banks		147,500								121,276
Premises and equipment		177,445								133,364
Other assets (3)		549,980								253,668
Total assets	$	8,210,120							$	6,669,950
Liabilities and Shareholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW	$	1,491,091			10,999		2.93		$	1,181,578			9,120		3.06
Money market		483,289			4,314		3.54			248,530			2,527		4.03
Savings		191,133			417		.87			170,472			248		.58
Time less than $100,000		1,583,777			19,408		4.86			1,578,369			19,072		4.79
Time greater than $100,000		1,362,812			17,467		5.08			1,330,375			17,366		5.18
Brokered		323,175			4,059		4.98			353,133			4,207		4.73
Total interest-bearing deposits		5,435,277			56,664		4.14			4,862,457			52,540		4.29
Federal funds purchased and other borrowings		466,408			6,010		5.11			105,650			1,505		5.65
Federal Home Loan Bank advances		531,196			6,275		4.69			334,217			4,677		5.55
Long-term debt		143,814			2,089		5.76			112,923			2,190		7.69
Total borrowed funds		1,141,418			14,374		5.00			552,790			8,372		6.01
Total interest-bearing liabilities		6,576,695			71,038		4.29			5,415,247			60,912		4.46
Non-interest-bearing liabilities:
Non-interest-bearing deposits		716,199								655,239
Other liabilities		80,031								52,045
Total liabilities		7,372,925								6,122,531
Shareholders’ equity		837,195								547,419
Total liabilities and shareholders’ equity	$	8,210,120							$	6,669,950
Net interest revenue				$	69,730							$	62,551
Net interest-rate spread							3.24	%							3.41	%
Net interest margin (4)							3.73	%							3.99	%

(1)	Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 39%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2)	Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued.
(3)	Securities available for sale are shown at amortized cost. Pretax unrealized losses of $799 thousand in 2007 and $12.7 million in 2006 are included in other assets for purposes of this presentation.
(4)	Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.

UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Twelve Months Ended December 31,

	2007								2006
	Average					Avg.			Average					Avg.
(dollars in thousands, taxable equivalent)	Balance			Interest		Rate			Balance			Interest		Rate
Assets:
Interest-earning assets:
Loans, net of unearned income (1)(2)	$	5,734,608		$	481,590		8.40	%	$	4,800,981		$	394,439		8.22	%
Taxable securities (3)		1,236,595			64,377		5.21			995,172			47,149		4.74
Tax-exempt securities (1) (3)		41,340			2,826		6.84			46,725			3,240		6.93
Federal funds sold and other interest-earning assets		58,357			2,124		3.64			34,605			1,867		5.40
Total interest-earning assets		7,070,900			550,917		7.79			5,877,483			446,695		7.60
Non-interest-earning assets:
Allowance for loan losses		(81,378	)							(59,376	)
Cash and due from banks		135,021								122,268
Premises and equipment		164,153								123,865
Other assets (3)		441,834								222,908
Total assets	$	7,730,530							$	6,287,148
Liabilities and Shareholders’ Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW	$	1,406,655			45,142		3.21		$	1,115,434			30,549		2.74
Money market		399,838			15,396		3.85			202,477			7,496		3.70
Savings		188,560			1,653		.88			172,698			928		.54
Time less than $100,000		1,619,279			79,333		4.90			1,410,869			61,676		4.37
Time greater than $100,000		1,377,915			71,467		5.19			1,134,414			54,304		4.79
Brokered		337,376			16,600		4.92			334,243			14,344		4.29
Total interest-bearing deposits		5,329,623			229,591		4.31			4,370,135			169,297		3.87
Federal funds purchased and other borrowings		308,372			16,236		5.27			140,544			7,319		5.21
Federal Home Loan Bank advances		455,620			22,013		4.83			465,820			23,514		5.05
Long-term debt		122,555			8,594		7.01			112,135			8,685		7.75
Total borrowed funds		886,547			46,843		5.28			718,499			39,518		5.50
Total interest-bearing liabilities		6,216,170			276,434		4.45			5,088,634			208,815		4.10
Non-interest-bearing liabilities:
Non-interest-bearing deposits		699,002								647,300
Other liabilities		72,587								44,268
Total liabilities		6,987,759								5,780,202
Shareholders’ equity		742,771								506,946
Total liabilities and shareholders’ equity	$	7,730,530							$	6,287,148
Net interest revenue				$	274,483							$	237,880
Net interest-rate spread							3.34	%							3.50	%
Net interest margin (4)							3.88	%							4.05	%

(1)	Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 39%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2)	Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued.
(3)	Securities available for sale are shown at amortized cost. Pretax unrealized losses of $8.1 million in 2007 and $17.5 million in 2006 are included in other assets for purposes of this presentation.
(4)	Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.