State Bank Financial Corporationtoday announced unaudited financial results for the quarter endedSeptember 30, 2011. Net income for the quarter was$17.1 million, bringing the company's year-to-date net income to$33.9 million. Fully diluted earnings per share were$.53for the quarter and$1.04year-to-date. Tangible book value per share atSeptember 30, 2011climbed to$12.04.

"Our positive 3rd quarter results reflect a combination of continued success in liquidating the problem assets acquired in the failed bank transactions, booking new high quality assets, and effectively controlling both interest and noninterest expense. While we are pleased with the significant increase in loan accretion over the second quarter, we are very mindful of the volatility of this significant part of our income," said State Bank Chairman and CEOJoe Evans.

Income Statement

Net income for the third quarter of 2011 of$17.1 million, was up from$8.6 millionin the second quarter of 2011 due to higher accretion on loans covered by FDIC loss share agreements, strong organic loan growth and a lower cost of funds. The accretion of the discount on acquired loans will likely contribute to volatility in net interest income in future periods based on periodic reviews of expected cash flows on those loans.

Total assets atSeptember 30, 2011were$2.68 billion, a decrease of$90.5 million, or 2.9 percent, fromJune 30, 2011. The largest single component of State Bank's loan portfolio remains the portfolios acquired from the FDIC under loss share agreements. AtSeptember 30, 2011, these loans had unpaid principal balances of$1.18 billionand recorded investment values of$770.1 million. These amounts compare to$1.30 billionand$814.4 millionrespectively atJune 30, 2011. The reduction reflects continued liquidation of this portfolio of loans. Non-covered loans were$650.3 millionatSeptember 30, 2011representing a$104.2 million, or 19.1 percent, increase fromJune 30, 2011. The allowance for loan losses for these non-covered loans atSeptember 30, 2011was$7.7 millionand represented 1.18 percent of those loans. The credit quality of the non-covered loan portfolio continues to be solid with nonperforming loans at the end of the quarter at only$2.3 million. Other real estate owned, virtually all of which is covered under loss share agreements, totaled$95.7 millionatSeptember 30, 2011.

Total deposits atSeptember 30, 2011were$2.24 billion, compared to$2.36 billionatJune 30, 2011, a decrease of$116.4 million, reflecting continued focus on managing down higher cost deposits. Total shareholders' equity atSeptember 30, 2011was$389.1 million, a$14.5 million, or 3.9 percent, increase fromJune 30, 2011. Regulatory capital ratios for State Bank Financial Corporation remain at very high levels. AtSeptember 30, 2011the leverage ratio was 14.2 percent and total capital to risk weighted assets was 34.5 percent.