Intervest Bancshares (IBCA) 8-K Reports Net Loss of $0.7 Million for the Third Quarter of 2010

Exhibit 99.1

INTERVEST BANCSHARES CORPORATION

Reports Net Loss of $0.7 Million for the Third Quarter of 2010

Business Editors - New York – (Business Wire – October 12, 2010)

Intervest Bancshares Corporation (NASDAQ-GS: IBCA) (the “Company”) today reported a net loss for the third quarter of 2010 (“Q3-10”) of $0.7 million, or $0.07 per diluted common share, compared to net income of $0.3 million, or $0.04 per share, for the third quarter of 2009 (“Q3-09”). Results for both periods included $0.4 million of preferred dividend requirements related to the Company’s participation in TARP. The change in results was primarily due to a $1.8 million increase in the combined provision for loan and real estate losses and a $0.6 million non-recurring charge related to the conversion of Intervest National Bank’s core data processing to a lower-cost provider. These items were partially offset by a $1.3 million decrease in carrying expenses associated with a lower level of nonperforming assets. At September 30, 2010, the Company’s common stock book value per share was $15.26.

At September 30, 2010, nonaccrual loans, troubled debt restructurings (TDRs) and real estate owned aggregated to $78 million, or 3.7% of total assets, compared to $75 million, or 3.4%, at June 30, 2010 and $253 million, or 10.5%, at December 31, 2009. At September 30, 2010, the allowance for loan losses was $32.3 million, representing 2.37% of total net loans, compared to $30.4 million, or 2.17%, at June 30, 2010 and $32.6 million, or 1.94%, at December 31, 2009.

At September 30, 2010, Intervest National Bank’s regulatory capital ratios were as follows: total capital to risk-weighted assets – 12.43%; Tier 1 capital to risk-weighted assets – 11.17%; and Tier 1 capital to total average assets (leverage ratio) – 8.42%. Except for its leverage ratio requirement of 9%, the Bank’s other two capital ratios were in excess of the higher levels of capital that the Bank has agreed to maintain of 12% and 10%, respectively. The Company’s consolidated regulatory ratios were 12.96%, 11.68% and 8.81%, respectively, at September 30, 2010.

Lowell Dansker, Chairman of the Company, commented: “We are encouraged by positive trends in our credit quality as the migration of performing loans to nonaccrual or TDR status slowed to $10 million in Q3-10, a substantial decrease from $47 million and $23 million in the first and second quarter of 2010, respectively. The bulk of our loan portfolio has and continues to perform during this very difficult economic environment. Although we were required in Q3-10 to re-classify approximately $21 million of our performing TDRs to nonaccrual status based on regulatory guidance, our total nonperforming assets (inclusive of TDRs) remained relatively stable at $78 million at quarter end, up slightly from $75 million at June 30. These TDRs continue to pay as agreed under their renegotiated terms. We also made progress during the quarter in increasing our capital ratios.”

Mr. Dansker continued: “Looking forward, beginning in 2011 our new data processing system is expected to save approximately $0.8 million annually for each of the next seven years. We also continue to see strong demand for our loan product from asset purchasers who have expressed interest in our performing, classified and nonaccrual loans. Our websitewww.I-Netmortgageclearinghouse.com continues to generate leads for us. The economies and commercial real estate markets in our main lending areas of Florida and New York remain challenging. Our management team is committed to working through our remaining problem assets, returning to profitability and re-building shareholder value.”

The combined provision for loan and real estate losses increased to $4.6 million in Q3-10, from $2.8 million in Q3-09, reflecting credit rating downgrades on certain loans, the impact of transferring $21 million of performing TDRs to nonaccrual status and lower estimates of value on ORE properties in Florida and Georgia. Noninterest expenses decreased to $5.8 million in Q3-10 from $6.9 million in Q3-09, primarily due to a decrease of $1.3 million in carrying expenses associated with nonperforming assets and $0.5 million of non-recurring expense in Q3-09 related to the early retirement of higher cost borrowings. These items were partially offset by a $0.6 million non-recurring charge in Q3-10 related to the data processing conversion referred to above. In Q3-10, an income tax benefit of $78,000 was recorded, compared to $0.6 million of income tax expense in Q3-09.

Net interest and dividend income decreased by $0.9 million to $10.1 million in Q3-10 from $11.0 million in Q3-09, reflecting the planned reduction in the size of our balance sheet, partially offset by an improved net interest margin. The margin increased to 1.98% in Q3-10 from 1.86% in Q3-09 primarily due to the effect of lower rates paid on deposits and the repayment of higher cost borrowings. The positive effect of these items was partially offset primarily by calls of higher yielding U.S. government agency security investments (coupled with reinvestment of the proceeds into similar securities with lower interest rates). The yield on average interest-earning assets decreased by 28 basis points to 4.96% in Q3-10, from 5.24% in Q3-09. The average cost of funds decreased at a faster pace by 60 basis points to 3.15% in Q3-10, from 3.75% in Q3-09. In Q3-10, average loans outstanding decreased by $352 million from Q3-09, while average interest-bearing deposits and borrowed funds decreased by $178 million and $18 million, respectively, from Q3-09. The Company’s loan portfolio had an average yield of 6.42% in Q3-10.

Total assets at September 30, 2010 decreased to $2.10 billion from $2.40 billion at December 31, 2009, primarily reflecting a decrease in loans receivable and security investments, partially offset by an increase in the deferred tax asset.

Total loans receivable, net of unearned fees, amounted to $1.36 billion at September 30, 2010, a $323 million decrease from $1.68 billion at December 31, 2009. The decrease was due to an aggregate of $229 million of principal reductions resulting from the bulk sale completed in the second quarter of 2010 and other principal repayments, $41 million of loans transferred to real estate owned and $99 million of loan chargeoffs, partially offset by $46 million of new loan originations. The Company does not own or originate construction/development loans. Total securities held to maturity decreased by $21.0 million to $613.8 million at September 30, 2010 from $634.8 million at December 31, 2009, primarily due to calls exceeding new purchases. The securities portfolio is comprised mainly of U.S. government agency securities. At September 30, 2010, the Company had a net deferred tax asset totaling $47.8 million, of which $29 million related to an unused gross operating loss carryforward of $67 million generated from the previously reported May 2010 bulk sale of nonperforming and underperforming assets.

Total deposits at September 30, 2010 decreased to $1.81 billion from $2.03 billion at December 31, 2009, reflecting a $183.3 million decrease in time deposits and a $40.5 million decrease in money market deposit accounts, both of which were due to Intervest National Bank’s planned reduction in its deposit rates. Total borrowed funds and related interest payable at September 30, 2010 decreased to $89 million, from $119 million at December 31, 2009, due to the maturity and repayment of $31 million of FHLBNY borrowings. Total stockholders’ equity at September 30, 2010 decreased to $164.1 million from $214.1 million at December 31, 2009, primarily due to a net loss of $55.4 million for the nine-months ended September 30, partially offset by the private placement in May 2010 of 850,000 shares of common stock at $5 per share for net proceeds of approximately $4.0 million.

As previously disclosed, Intervest National Bank is operating under a Memorandum of Understanding (“MOU”) with its primary regulator that addresses various issues. Although progress has and continues to be made in complying with all of the requirements of the MOU, as previously disclosed we understand that the OCC plans to pursue and enter into a formal agreement with the Bank, which agreement is likely to cover many of the same areas addressed in the MOU, including maintaining minimum capital ratios as set out earlier in this press release. As previously disclosed, if the Bank enters into the formal agreement, it will also not be allowed to accept brokered deposits without the prior approval of its regulator and it would also be required, in the absence of a waiver from the FDIC, to maintain its deposit pricing at or below the national rates published by the FDIC, plus 75 basis points. At September 30, 2010, the Bank’s brokered deposits totaled $159.1 million (8.8% of total deposits) and the rates offered on all the Bank’s deposit products were at levels at or below the FDIC national rates plus 75 basis points.

Intervest Bancshares Corporation is a bank holding company. Its principal operating subsidiary is Intervest National Bank, a nationally chartered commercial bank that has its headquarters and full-service banking office at One Rockefeller Plaza, in New York City, and a total of six full-service banking offices in Clearwater and Gulfport, Florida. Intervest Bancshares Corporation’s Class A Common Stock is listed on the NASDAQ Global Select Market: Trading Symbol IBCA. This press release may contain forward-looking information. Words such as “may,” “will,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “project,” “assume,” “indicate,” “continue,” “target,” “goal,” and similar words or expressions of the future are intended to identify forward-looking statements. Except for historical information, the matters discussed herein are subject to certain risks and uncertainties that may affect the Company’s actual results of operations. The following important factors, among others, could cause actual results to differ materially from those set forth in forward looking statements: changes in general economic conditions and real estate values in the Company’s market areas; changes in regulatory policies and enforcement actions; fluctuations in interest rates; demand for loans and deposits; changes in tax laws or the availability of net operating losses, the effects of additional capital, the availability of regulatory waivers; and competition. Reference is made to the Company’s filings with the SEC for further discussion of risks and uncertainties regarding the Company’s business. Historical results are not necessarily indicative of the future prospects of the Company.

Contact: Lowell S. Dansker, Chairman, Intervest Bancshares Corporation

One Rockefeller Plaza (Suite 400), New York, New York 10020-2002, Phone 212-218-2800 Fax 212-218-2808

Selected Consolidated Financial Information Follows.

INTERVEST BANCSHARES CORPORATION

Selected Consolidated Financial Information

(Dollars in thousands, except per share amounts)

	Quarter Ended September 30,							Nine-Months Ended September 30,
Selected Operating Data:	2010				2009			2010			2009
Interest and dividend income	$	25,265			$	30,939		$	82,325		$	92,422
Interest expense		15,180		��		19,924			48,385			61,920
Net interest and dividend income		10,085				11,015			33,940			30,502
Provision for loan losses		1,598				2,396			98,770			6,939
Provision for real estate losses		2,984				400			13,505			688
Noninterest income		7				95			1,037			225
Noninterest expenses		5,828				6,936			17,944			19,141
(Loss) earnings before income taxes		(318	)			1,378			(95,242	)		3,959
(Benefit) provision for income taxes		(78	)			627			(41,075	)		1,535
Net (loss) earnings before preferred dividend requirements		(240	)			751			(54,167	)		2,424
Preferred dividend requirements (1)		421				409			1,245			1,223
Net (loss) earnings available to common stockholders	$	(661	)		$	342		$	(55,412	)	$	1,201
Basic (loss) earnings per common share	$	(0.07	)		$	0.04		$	(6.39	)	$	0.14
Diluted (loss) earnings per common share		(0.07	)			0.04			(6.39	)		0.14
Average common shares used to calculate:
Basic (loss) earnings per common share		9,120,812				8,270,812			8,672,460			8,270,812
Diluted (loss) earnings per common share (2)		9,120,812				8,270,812			8,672,460			8,270,812
Common shares outstanding at end of period		9,120,812				8,270,812			9,120,812			8,270,812
Common stock options/warrants outstanding at end of period		1,018,122				952,012			1,018,122			952,012
Yield on interest-earning assets		4.96	%			5.24	%		5.14	%		5.35	%
Cost of funds		3.15	%			3.75	%		3.25	%		3.99	%
Net interest margin (3)		1.98	%			1.86	%		2.12	%		1.76	%
Return on average assets (annualized)		-0.05	%			0.13	%		-3.23	%		0.14	%
Return on average common equity (annualized)		-0.68	%			1.58	%		-42.89	%		1.71	%
Effective income tax rate		24.53	%			45.50	%		43.13	%		38.77	%
Efficiency ratio (4)		51	%			45	%		41	%		50	%
Total average loans outstanding	$	1,382,753			$	1,734,983		$	1,533,305		$	1,729,587
Total average securities outstanding		624,197				601,338			586,284			567,717
Total average short-term investments outstanding		14,690				7,071			20,973			13,498
Total average assets outstanding		2,127,002				2,378,372			2,233,547			2,340,197
Total average interest-bearing deposits outstanding	$	1,819,907			$	1,997,690		$	1,889,498		$	1,953,302
Total average borrowings outstanding		92,801				111,247			100,671			121,156
Total average stockholders’ equity		164,288				213,003			192,008			212,635

	At Sep 30,			At Jun 30,			At Mar 31,			At Dec 31,			At Sep 30,
Selected Financial Condition Information:	2010			2010			2010			2009			2009
Total assets	$	2,104,098		$	2,164,442		$	2,284,257		$	2,401,204		$	2,382,170
Total cash and short-term investments		13,815			35,535			56,470			7,977			30,660
Total securities held to maturity		613,844			621,244			491,067			634,856			598,313
Total loans, net of unearned fees		1,363,312			1,395,564			1,634,140			1,686,164			1,696,064
Total deposits		1,806,834			1,852,356			1,926,772			2,029,984			2,012,995
Total borrowed funds and accrued interest payable		89,135			98,582			103,060			118,552			107,547
Total preferred equity		23,755			23,659			23,563			23,466			23,370
Total common equity		140,317			140,643			187,711			190,588			190,249
Common book value per share (5)		15.26			15.33			22.69			23.04			23.00
Total allowance for loan losses	$	32,250		$	30,350		$	28,300		$	32,640		$	31,815
Allowance for loan losses/net loans		2.37	%		2.17	%		1.73	%		1.94	%		1.88	%
Total loan recoveries for the quarter		600			—			—			25			—
Total loan chargeoffs for the quarter		298			85,483			13,979			3,126			2,635
Total real estate chargeoffs for the quarter		912			11,732			—			—			—
Total loans ninety days past due and still accruing (6)	$	16,865		$	8,788		$	3,629		$	6,800		$	1,947
Total accruing troubled debt restructured loans (7)		617			21,362			116,906			97,311			71,156
Total nonaccrual loans		38,560			18,927			96,248			123,877			131,742
Total real estate owned, net of valuation allowance		38,792			34,259			57,858			31,866			32,915

(1) Represents dividend requirements on $25 million of 5% cumulative preferred stock held by the U.S. Treasury and amortization of related preferred stock discount. Dividend payments that were due February, May and August 2010 are unpaid and in arrears.

(2) Outstanding options/warrants were not dilutive for the reporting periods.

(3) Net interest margin is reported exclusive of income from loan prepayments, which is included as a component of noninterest income.

(4) Represents noninterest expenses (excluding provisions for loan and real estate losses & real estate expenses) as a percentage of net interest and dividend income plus noninterest income.

(5) Represents total common stockholders’ equity less preferred stock dividends in arrears of $1.1 million divided by the number of common shares outstanding.

(6) At September 30, 2010, these were performing loans that were past their contractual maturity date. Extensions for the majority at market terms are pending.

(7) Represent loans whose terms have been modified mostly through the deferral of principal and/or a partial reduction in interest payments.

INTERVEST BANCSHARES CORPORATION

Consolidated Financial Highlights

	At or For The Period Ended
($ in thousands, except per share amounts)	Nine-Months Ended Sep 30, 2010			Year Ended Dec 31, 2009				Year Ended Dec 31, 2008			Year Ended Dec 31, 2007			Year Ended Dec 31, 2006
Balance Sheet Highlights:
Total assets	$	2,104,098		$	2,401,204			$	2,271,833		$	2,021,392		$	1,971,753
Total cash and short-term investments		13,815			7,977				54,903			33,086			40,195
Total securities held to maturity		613,844			634,856				475,581			344,105			404,015
Total loans, net of unearned fees		1,363,312			1,686,164				1,705,711			1,614,032			1,490,653
Total deposits		1,806,834			2,029,984				1,864,135			1,659,174			1,588,534
Total borrowed funds and accrued interest payable		89,135			118,552				149,566			136,434			172,909
Preferred stockholder’s equity		23,755			23,466				23,080			—			—
Common stockholders’ equity		140,317			190,588				188,894			179,561			170,046
Common book value per share (1)		15.26			23.04				22.84			22.23			20.31
Market price per common share		2.10			3.28				3.99			17.22			34.41
Asset Quality Highlights
Nonaccrual loans	$	38,560		$	123,877			$	108,610		$	90,756		$	3,274
Real estate owned, net of valuation allowance		38,792			31,866				9,081			—			—
Accruing troubled debt restructured loans (2)		617			97,311				—			—			—
Loans ninety days past due and still accruing		16,865			6,800				1,964			11,853			—
Allowance for loan losses		32,250			32,640				28,524			21,593			17,833
Allowance for loan losses/net loans		2.37	%		1.94	%			1.67	%		1.34	%		1.20	%
Loan chargeoffs		99,760			8,103				4,227			—			—
Real estate chargeoffs		12,644			—				—			—			—
Loan recoveries		600			1,354				—			—			—
Statement of Operations Highlights:
Interest and dividend income	$	82,325		$	123,598			$	128,497		$	131,916		$	128,605
Interest expense		48,385			81,000				90,335			89,653			78,297
Net interest and dividend income		33,940			42,598				38,162			42,263			50,308
Provision for loan losses		98,770			10,865				11,158			3,760			2,652
Provision for real estate losses		13,505			2,275				518			—			—
Noninterest income		1,037			297				5,026			8,825			6,855
Noninterest expenses		17,944			24,809				18,355			12,876			13,027
(Loss) earnings before income taxes		(95,242	)		4,946				13,157			34,452			41,484
(Benefit) provision for income taxes		(41,075	)		1,816				5,891			15,012			17,953
Net (loss) earnings before preferred dividend requirements		(54,167	)		3,130				7,266			19,440			23,531
Preferred dividend requirements (3)		1,245			1,632				41			—			—
Net (loss) earnings available to common stockholders	$	(55,412	)	$	1,498			$	7,225		$	19,440		$	23,531
Basic (loss) earnings per common share	$	(6.39	)	$	0.18			$	0.87		$	2.35		$	2.98
Diluted (loss) earnings per common share	$	(6.39	)	$	0.18			$	0.87		$	2.31		$	2.82
Adjusted net earnings used to calculate diluted (loss) earnings per common share	$	(55,412	)	$	1,498			$	7,225		$	19,484		$	23,679
Average common shares used to calculate:
Basic (loss) earnings per common share		8,672,460			8,270,812				8,259,091			8,275,539			7,893,489
Diluted (loss) earnings per common share		8,672,460			8,270,812				8,267,781			8,422,017			8,401,379
Common shares outstanding		9,120,812			8,270,812				8,270,812			8,075,812			8,371,595
Net interest margin (4)		2.12	%		1.83	%			1.79	%		2.11	%		2.75	%
Return on average assets		-3.23	%		0.13	%			0.34	%		0.96	%		1.28	%
Return on average common equity		-42.89	%		1.65	%	��		3.94	%		11.05	%		15.82	%
Effective income tax rate		43.13	%		36.72	%			44.77	%		43.57	%		43.28	%
Efficiency ratio (5)		41	%		46	%			33	%		24	%		23	%
Full-service banking offices		7			7				7			7			7

(1) Represents total common stockholders’ equity less preferred stock dividends in arrears of $1.1 million divided by the number of common shares outstanding.

(2) Represent loans whose terms have been modified mostly through the deferral of principal and/or a partial reduction in interest payments.

(3) Represents dividend requirements on $25 million of 5% cumulative preferred stock and amortization of related preferred stock discount. Dividend payments that were due February, May and August 2010 are unpaid and in arrears.

(4) Net interest margin is reported exclusive of income from loan prepayments, which is included as a component of noninterest income. Inclusive of such income, the margin would compute to 2.18% for the nine-months ended Sep 30, 2010, 1.81% for 2009, 1.95% for 2008, 2.57% for 2007 and 3.11% for 2006.

(5) Represents noninterest expenses (excluding provision for loan losses and real estate expenses) as a percentage of net interest and dividend income plus noninterest income.