First Community Bankshares (FCBC) 8-K First Community Bancshares, Inc. Announces Upward Revision to Second Quarter and Six Months Earnings

EXHIBIT 99.1

NEWS RELEASE

FOR IMMEDIATE RELEASE:	FOR MORE INFORMATION,
July 29, 2004	CONTACT: Robert L. Schumacher at (276) 326-9000

First Community Bancshares, Inc. Announces Upward Revision to Second Quarter
and Six Months Earnings

Bluefield, Virginia — First Community Bancshares, Inc. (NASDAQ): FCBC; (www.fcbinc.com) announced today that it was revising upward its previously announced second quarter net income and income from continuing operations by $129,000 or $0.01 per basic and diluted share. The adjustment is related to revised pension cost estimates provided by the Company’s independent third party advisor for certain of its non-qualified benefit plans. The advisor had previously provided incorrect information on the cost of one of the Company’s non-qualified supplemental plans, in the amount of $212,000 ($129,000 after tax) for both the second quarter and the six month period. Accordingly, net income, income from continuing operations and earnings per share were revised upward by $129,000 or $0.01 per diluted share for the three and six months ended June 30, 2004.

While the net effect on second quarter results was considered marginal for adjustment purposes, the Company felt that correction of the cost in the second quarter would provide the most accurate accounting and facilitate a more meaningful comparison of subsequent linked quarters.

The original release dated July 23, 2004 reported net income for the quarter of $5.585 million and is now revised to $5.714 million, with basic earnings per share increasing from $0.50 to $0.51. Likewise, the income originally reported for the six months ended June 30, 2004 of $9.746 million or $0.87 basic earnings per share, is now revised to $9.875 million or $0.88 basic earnings per share. The following table reflects revised and original earnings release data for key Balance Sheet, Income Statement and Per Share information affected by the change in the benefit cost. Complete revised financial schedules are also provided with this release.

1

Income Statement Captions:
(Amounts in Thousands)

	Six Months Ended						Three Months Ended
	June 30, 2004						June 30, 2004
	Originally						Originally
	Provided			Revised			Provided			Revised
Salaries and employee benefits		12,987			12,775			6,874			6,662
Total non-interest expense		23,348			23,136			12,438			12,226
Income from continuing operations		17,825			18,037			10,040			10,252
Income tax expense-continuing operations		4,766			4,849			2,583			2,666
Income from continuing operations		13,059			13,188			7,457			7,586
(Loss) income from discontinued operations		(4,265	)		(4,265	)		(2,374	)		(2,374	)
Income tax expense-discontinued operations		(952	)		(952	)		(502	)		(502	)
Net loss from discontinued operations		(3,313	)		(3,313	)		(1,872	)		(1,872	)
Net income	$	9,746		$	9,875		$	5,585			5,714
Basic earnings per common share	$	0.87		$	0.88		$	0.50		$	0.51
Diluted earnings per common share	$	0.86		$	0.87		$	0.49		$	0.50
Basic EPS from continuing operations	$	1.16		$	1.17		$	0.66		$	0.67
Diluted EPS from continuing operations	$	1.15		$	1.16		$	0.66		$	0.67
Return on average equity		11.07	%		11.22	%		12.76	%		13.06	%
Return on average equity-continuing operations		14.83	%		14.98	%		17.04	%		17.33	%
Return on average assets		1.10	%		1.12	%		1.20	%		1.22	%
Return on average assets-continuing operations		1.50	%		1.52	%		1.62	%		1.65	%
Book value per share at period end	$	15.27		$	15.28		$	15.27		$	15.28

Balance sheet captions:

	Six Months Ended
	June 30, 2004
	Originally
	Provided		Revised
Other assets		25,649		25,566
Total assets	$	1,849,321	$	1,849,238
Interest, taxes and other liabilities		11,714		11,501
Total liabilities		1,678,066		1,677,853
Retained earnings	$	61,023	$	61,153
Total stockholders’ equity		171,255		171,385
Total liabilities and stockholders’ equity	$	1,849,321	$	1,849,238

Ratios:

	Period-end
	June 30, 2004
	Originally
	Provided			Revised
Efficiency ratio		60.45	%		59.97	%
Efficiency ratio-continuing		49.67	%		49.18	%

     First Community Bancshares, Inc. headquartered in Bluefield, Virginia, is a $1.85 billion bank holding company and is the parent company of First Community Bank, N. A. First Community Bank, N. A. operates through 52 full-service banking locations, two trust and investment management offices in the four states of Virginia, West Virginia, North Carolina and Tennessee. First Community Bank is also the parent of Stone Capital Management, Inc., a SEC registered investment advisory firm, which offers wealth management and investment advice and United First Mortgage, Inc., which operates 4 retail mortgage offices in Virginia. First Community Bancshares, Inc.’s common stock is traded on the NASDAQ National market under the symbol “FCBC”.

DISCLAIMER

     This news release may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include: changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed from time to time in the Company’s Securities and Exchange Commission reports, including but not limited to the Annual Report on Form 10-K for the most recent year ended. Pursuant to the Private Securities Litigation Act of 1995, the Company does not undertake to update forward-looking statements contained within this news release.

First Community Bancshares, Inc.
Consolidated Statements of Income
(Dollars in Thousands, Except Per Share Data)(Unaudited)

		Six Months Ended						Three Months Ended
		June 30,						June 30,
		2004			2003			2004			2003
Interest	Interest and fees on loans held for investment	$	36,242		$	33,874		$	19,112		$	16,982
	Interest on securities-taxable		6,699			6,519			3,433			3,385
	Interest on securities-nontaxable		3,343			3,299			1,707			1,642
	Interest on federal funds sold and deposits		301			358			104			143
	Total interest income		46,585			44,050			24,356			22,152
Interest	Interest on deposits		9,128			10,459			4,813			5,142
Expense	Interest on borrowings		3,846			3,015			1,916			1,490
	Total interest expense		12,974			13,474			6,729			6,632
	Net interest income		33,611			30,576			17,627			15,520
	Provision for loan losses		1,255			1,897			723			1,308
	Net interest income after provision for loan losses		32,356			28,679			16,904			14,212
Non-Interest	Fiduciary income		930			981			512			649
Income	Service charges on deposit accounts		4,261			3,807			2,301			1,986
	Other service charges, commissions and fees		1,272			1,069			713			472
	Other operating income		905			541			610			244
	Gain on sale of securities		1,449			153			1,438			133
	Total non-interest income		8,817			6,551			5,574			3,484
Non-Interest	Salaries and employee benefits		12,775			9,466			6,662			4,784
Expense	Occupancy expense of bank premises		1,746			1,456			894			720
	Furniture and equipment expense		1,373			895			747			442
	Amortization of intangible assets		175			114			111			51
	Other operating expense		7,067			5,566			3,812			2,756
	Total non-interest expense		23,136			17,497			12,226			8,753
	Income from continuing operations before income taxes		18,037			17,733			10,252			8,943
	Income tax expense continuing operations		4,849			4,969			2,666			2,499
	Income from continuing operations	$	13,188		$	12,764		$	7,586		$	6,444
	(Loss) income from discontinued operations before tax	$	(4,265	)	$	1,557		$	(2,374	)	$	856
	Income tax (benefit) expense discontinued operations	$	(952	)	$	606		$	(502	)	$	333
	(Loss) income from discontinued operations	$	(3,313	)	$	951		$	(1,872	)	$	523
	Net income	$	9,875		$	13,715		$	5,714		$	6,967
	Basic earnings per common share (EPS)	$	0.88		$	1.25		$	0.51		$	0.63
	Diluted earnings per common share (DEPS)	$	0.87		$	1.25		$	0.50		$	0.63
	Basic earnings per common share-continuing operations	$	1.17		$	1.17		$	0.67		$	0.59
	Diluted earnings per common share-continuing operations	$	1.16		$	1.17		$	0.67		$	0.59
	Weighted Average Shares Outstanding:
	Basic		11,237,225			10,937,927			11,228,956			10,969,748
	Diluted		11,334,096			11,021,010			11,320,415			11,084,847
	For the period:
	Return on average equity		11.22	%		17.46	%		13.06	%		17.29	%
	Return on average equity-continuing operations		14.98	%		16.25	%		17.33	%		15.99	%
	Return on average assets		1.12	%		1.79	%		1.22	%		1.78	%
	Return on average assets-continuing operations		1.52	%		1.73	%		1.65	%		1.71	%
	Cash dividends per share	$	0.50		$	0.47		$	0.25		$	0.23
	At period end:
	Book value per share	$	15.28		$	15.57		$	15.28		$	15.57
	Market value	$	33.50		$	31.99		$	33.50		$	31.99

First Community Bancshares, Inc.
Consolidated Balance Sheets
(Dollars in Thousands, Except Per Share Data)(Unaudited)

		June 30,			December 31,
		2004			2003
Assets	Cash and due from banks	$	41,533		$	37,173
	Interest-bearing deposits with banks		14,799			22,136
	Securities available for sale (amortized cost of $432,782
	June 30, 2004; $435,912, December 31, 2003)		429,478			444,194
	Securities held to maturity (fair value of $39,629
	March 31, 2004; $40,060, December 31, 2003)		36,209			38,020
	Loans held for sale		774			424
	Loans held for investment, net of unearned income		1,186,954			1,026,191
	Less allowance for loan losses		16,160			14,624
	Net loans		1,170,794			1,011,567
	Premises and equipment		35,071			29,816
	Other real estate owned		2,166			2,091
	Interest receivable		8,653			8,327
	Other assets		25,566			17,266
	Intangible assets		62,003			39,341
	Assets related to discontinued operations		22,192			22,372
	Total Assets	$	1,849,238		$	1,672,727
Liabilities	Deposits:
	Demand	$	225,241		$	194,046
	Interest-bearing demand		318,932			234,458
	Savings		224,706			190,366
	Time		626,150			606,666
	Total Deposits		1,395,029			1,225,536
	Interest, taxes and other liabilities		11,501			11,897
	Securities sold under agreements to repurchase		109,252			97,651
	FHLB and other indebtedness		140,941			144,616
	Liabilities related to discontinued operations		21,130			17,992
	Total Liabilities		1,677,853			1,497,692
Stockholders’	Preferred stock, par value undesignated; 1,000,000 shares authorized;
Equity	no shares issued and outstanding in 2004 and 2003		—			—
	Common stock, $1 par value; 15,000,000 shares authorized in 2004
	and 2003, respectively; 11,451,062 issued in 2004 and 11,442,348
	issued in 2003; and 11,215,473 and 11,242,443 outstanding in
	2004 and 2003, respectively		11,451			11,442
	Additional paid-in capital		108,078			108,128
	Retained earnings		61,153			56,894
	Treasury stock, at cost		(7,321	)		(6,407	)
	Accumulated other comprehensive (loss) income		(1,976	)		4,978
	Total Stockholders’ Equity		171,385			175,035
	Total Liabilities and Stockholders’ Equity	$	1,849,238		$	1,672,727

First Community Bancshares, Inc.
Quarterly Performance Summary
Income Statements
(Dollars in Thousands Except Per Share Data)

		As of and for the Quarter Ended
		June 30,			March 31,			December 31,			September 30,			June 30,
		2004			2004			2003			2003			2003
Interest	Interest and fees on loans held for investment	$	19,112		$	17,130		$	17,967		$	18,591		$	16,982
	Interest on securities-taxable		3,433			3,266			3,528			3,070			3,385
	Interest on securities-nontaxable		1,707			1,636			1,637			1,552			1,642
	Interest on federal funds sold and deposits		104			197			122			124			143
	Total interest income		24,356			22,229			23,254			23,337			22,152
Interest	Interest on deposits		4,813			4,315			4,557			4,934			5,142
Expense	Interest on borrowings		1,916			1,930			1,797			1,635			1,490
	Total interest expense		6,729			6,245			6,354			6,569			6,632
	Net interest income		17,627			15,984			16,900			16,768			15,520
	Provision for loan losses		723			532			740			782			1,308
	Net interest income after provision
	for loan losses		16,904			15,452			16,160			15,986			14,212
Non-Int	Fiduciary income		512			418			258			549			649
Income	Service charges on deposit accounts		2,301			1,960			2,166			2,098			1,986
	Other service charges, commissions and fees		713			559			762			553			472
	Mortgage banking income		—			—			—			—			—
	Other operating income		610			295			317			340			244
	Gain (loss) on Securities		1,438			11			(90	)		1,038			133
	Total non-interest income		5,574			3,243			3,413			4,578			3,484
Non-Int	Salaries and employee benefits		6,662			6,113			5,547			5,631			4,784
Expense	Occupancy expense of bank premises		894			852			704			752			720
	Furniture and equipment expense		747			626			567			532			442
	Amortization of intangible assets		111			64			65			64			51
	Other operating expense		3,812			3,255			3,028			3,203			2,756
	Total non-interest expense		12,226			10,910			9,911			10,182			8,753
	Income before income taxes-continuing operations		10,252			7,785			9,662			10,382			8,943
	Income tax expense-continuing operations		2,666			2,183			2,925			3,164			2,499
	Income from continuing operations		7,586			5,602			6,737			7,218			6,444
	(Loss) income before tax-discontinued operations		(2,374	)		(1,891	)		(2,110	)		(1,621	)		856
	Income tax (benefit) expense-discontinued operations		(502	)		(450	)		(667	)		(632	)		333
	(Loss) income from discontinued operations		(1,872	)		(1,441	)		(1,443	)		(989	)		523
	Net income		5,714			4,161			5,294			6,229			6,967
Per	Basic EPS	$	0.51		$	0.37		$	0.47		$	0.55		$	0.63
Share	Diluted EPS	$	0.50		$	0.37		$	0.47		$	0.55		$	0.63
	Basic EPS from continuing operations	$	0.67		$	0.50		$	0.60		$	0.64		$	0.59
	Diluted EPS from continuing operations	$	0.67		$	0.49		$	0.59		$	0.64		$	0.59
Data	Cash dividends per share	$	0.25		$	0.25		$	0.25		$	0.25		$	0.24
	Weighted Average Shares Outstanding:
	Basic		11,228,956			11,245,465			11,244,382			11,262,180			10,969,748
	Diluted		11,320,415			11,347,748			11,362,269			11,383,941			11,084,847
	Actual shares outstanding at period end		11,215,473			11,244,894			11,242,443			11,250,931			11,256,674
	Book Value per share at period end	$	15.28		$	15.83		$	15.57		$	15.33		$	15.57
	Market Value per share at period end	$	33.50		$	30.54		$	33.16		$	35.29		$	35.58

First Community Bancshares, Inc.
Quarterly Performance Summary
Income Statements
(Dollars in Thousands Except Per Share Data)

	As of and for the Quarter Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2004			2004			2003			2003			2003
Ratios:
Return on average assets		1.22	%		1.00	%		1.25	%		1.46	%		1.78	%
Return on average assets-continuing		1.65	%		1.36	%		1.61	%		1.75	%		1.71	%
Return on average equity		13.06	%		9.40	%		12.01	%		14.10	%		17.29	%
Return on average equity-continuing		17.33	%		12.66	%		15.28	%		16.34	%		15.99	%
Net yield on earning assets		4.46	%		4.41	%		4.56	%		4.55	%		4.55	%
Net yield on earning assets-continuing		4.51	%		4.45	%		4.63	%		4.66	%		4.69	%
Efficiency Ratio at end of period		59.97	%		61.71	%		51.92	%		51.16	%		48.68	%
Efficiency Ratio at end of period-continuing		49.18	%		51.26	%		44.76	%		45.05	%		43.96	%
Equity as a percent of total assets at end of period		9.27	%		10.51	%		10.46	%		10.27	%		10.31	%
Equity as a percent of continuing assets at end of period		9.38	%		10.71	%		10.61	%		10.41	%		10.64	%
Average earning assets as a percentage of average total assets		90.96	%		92.21	%		91.92	%		91.91	%		92.67	%
Average earning assets-continuing as a percentage of average total assets continuing		91.12	%		92.37	%		92.18	%		91.99	%		92.84	%
Average loans (not including loans held for sale) as a percentage of average deposits		83.38	%		83.10	%		84.17	%		83.04	%		79.23	%
QTD Averages:
Average Loans (Not including Loans Held for Sale)	$	1,171,562		$	1,016,309		$	1,034,786		$	1,030,875		$	931,488
Average Earning Assets	$	1,708,139		$	1,543,157		$	1,545,585		$	1,559,472		$	1,454,319
Average Earning Assets-continuing	$	1,682,841		$	1,527,932		$	1,527,098		$	1,501,239		$	1,406,836
Average Total Assets	$	1,878,000		$	1,673,585		$	1,681,510		$	1,696,647		$	1,569,302
Average Total Assets-continuing	$	1,846,772		$	1,654,119		$	1,656,714		$	1,632,044		$	1,515,298
Average Deposits	$	1,405,121		$	1,223,032		$	1,229,439		$	1,241,420		$	1,175,618
Average Deposits-continuing	$	1,405,070		$	1,222,971		$	1,229,351		$	1,241,313		$	1,175,526
Average Equity	$	176,034		$	178,037		$	174,923		$	175,228		$	161,622
Taxable Equivalent Net Interest Income	$	18,948		$	16,937		$	17,773		$	17,899		$	16,504
Taxable Equivalent Net Interest Income-continuing	$	18,873		$	16,889		$	17,806		$	17,634		$	16,437
Average Interest-bearing deposits	$	1,182,311		$	1,036,976		$	1,038,341		$	1,046,364		$	1,008,130
Average Interest-bearing deposits-continuing	$	1,182,311		$	1,036,976		$	1,038,341		$	1,046,364		$	1,008,130

First Community Bancshares, Inc.
Quarterly Performance Summary
Balance Sheets

	(Dollars in Thousands Except Per Share Data)
	June 30,			March 31,			December 31,			September 30,			June 30,
	2004			2004			2003			2003			2003
Cash and due from banks	$	41,533		$	36,389		$	37,173		$	30,915		$	41,081
Interest-bearing deposits with banks		14,799			40,157			22,136			76,309			25,795
Federal funds sold		—			—			—			—			7,353
Securities available for sale		429,478			443,657			444,194			395,203			419,523
Securities held to maturity		36,209			37,425			38,020			39,433			39,745
Loans held for sale		774			257			424			206			1,285
Loans held for investment, net of unearned income		1,186,954			1,019,829			1,026,191			1,028,189			1,026,643
Less allowance for loan losses		16,160			14,536			14,624			15,680			15,707
Net loans		1,170,794			1,005,293			1,011,567			1,012,509			1,010,936
Premises and equipment		35,071			30,507			29,816			29,467			29,267
Other real estate owned		2,166			2,571			2,091			2,403			2,787
Interest receivable		8,653			8,434			8,327			8,388			8,333
Other assets		25,566			18,269			17,266			24,647			22,251
Intangible assets		62,003			39,226			39,341			38,121			39,518
Assets related to discontinued operations		22,192			32,275			22,372			21,735			52,438
Total Assets	$	1,849,238		$	1,694,460		$	1,672,727		$	1,679,336		$	1,700,312
Deposits:
Demand	$	225,241		$	197,282		$	194,046		$	193,941		$	210,347
Interest-bearing demand		318,932			243,226			234,458			234,737			234,551
Savings		224,706			194,722			190,366			188,021			185,284
Time		626,150			607,426			606,666			615,680			626,539
Total Deposits		1,395,029			1,242,656			1,225,536			1,232,379			1,256,721
Interest, taxes and other liabilities		11,501			12,619			11,897			12,474			21,513
Securities sold under agreements to repurchase		109,252			98,035			97,651			102,449			93,742
FHLB and other indebtedness		140,941			133,774			144,616			143,635			107,398
Liabilities related to discontinued operations		21,130			29,342			17,992			15,915			45,630
Total Liabilities		1,677,853			1,516,426			1,497,692			1,506,852			1,525,004
Preferred Stock		—			—			—			—			—
Common stock, $1 par value		11,451			11,450			11,442			11,433			11,390
Additional paid-in capital		108,078			108,243			108,128			108,078			108,286
Retained earnings		61,153			58,241			56,894			54,407			51,149
Treasury stock, at cost		(7,321	)		(6,566	)		(6,407	)		(5,762	)		(4,028	)
Accumulated other comprehensive (loss) income		(1,976	)		6,666			4,978			4,328			8,511
Total Stockholders’ Equity		171,385			178,034			175,035			172,484			175,308
Total Liabilities and Stockholders’ Equity	$	1,849,238		$	1,694,460		$	1,672,727		$	1,679,336		$	1,700,312

First Community
Bancshares, Inc.
Selected Financial Information
(Dollars in Thousands)

	As of and for the Quarter Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2004			2004			2003			2003			2003
Asset Quality Analysis:
Allowance for Loan Losses:
Beginning balance	$	14,536		$	14,624		$	15,680		$	15,707		$	13,782
Provision		723			532			740			782			1,308
Acquisition balance		1,786			—			—			—			1,583
Charge-offs		(1,233	)		(911	)		(2,022	)		(990	)		(1,441	)
Recoveries		348			291			226			181			475
Net charge-offs		(885	)		(620	)		(1,796	)		(809	)		(966	)
Ending balance	$	16,160		$	14,536		$	14,624		$	15,680		$	15,707
Nonperforming Assets:
Nonaccrual loans	$	2,630		$	3,588		$	2,993		$	2,277		$	2,547
Foreclosed real estate		2,166			2,571			2,091			2,403			2,787
Repossessions		92			60			75			125			140
Loans 90 days or more past due & still accruing		—			—			—			124			86
Nonperforming assets	$	4,888		$	6,219		$	5,159		$	4,929		$	5,560
Loans 90 days or more past due & still accruing as a percentage of loans held for investment		0.00	%		0.00	%		0.00	%		0.01	%		0.01	%
Asset Quality Ratios:
Nonaccrual loans and leases as a percentage of loans held for investment		0.22	%		0.35	%		0.29	%		0.22	%		0.25	%
Nonperforming assets as a percentage of:
Total assets		0.26	%		0.37	%		0.31	%		0.29	%		0.33	%
Total assets-continued		0.27	%		0.37	%		0.31	%		0.30	%		0.34	%
Loans held for investment plus foreclosed property		0.41	%		0.61	%		0.50	%		0.48	%		0.54	%
Net charge-offs as a % of average loans held for investment		0.08	%		0.06	%		0.17	%		0.08	%		0.10	%
Allowance for loan & lease losses as a percentage of loans held for investment		1.36	%		1.43	%		1.43	%		1.53	%		1.53	%
Ratio of allowance for loan losses to:
Nonaccrual loans		6.14			4.05			4.89			6.89			6.17
Restructured loans performing according to modified terms	$	382		$	392		$	356		$	362		$	368