Four key elements contribute to our loan portfolio’s strength: customer relationships, variety of real estate loans, geographic diversity, and conservative underwriting principles. The following significant statistics illustrate our asset quality:

• Our history of net charge-offs for the past ten years has been among the lowest of our Southeastern peers.
  
• Loan loss reserves could sustain 5.8 years of charge-offs at the 2000 level.
  
• Our nonperforming asset ratio was 0.54% at December 31, 2000.
  

Building Relationships

Our loan portfolio is one of the industry’s strongest and fastest growing because of our loan officers’ singular, long-term focus on relationships. They concentrate on cultivating genuine customer relationships, not on daily transactions. They also understand their customers’ business needs, thus providing a one-on-one relationship based on helping each customer improve his or her own business. Our customers appreciate that perceptive knowledge. Consequently, we have experienced above-average loan growth.

Successful History

Loans secured by real estate comprise almost 80% of our portfolio. We have a long history of success in this type of lending and believe real estate provides the best collateral for loans. We have no major concentrations in any particular type of real estate loan, and because of that variety, combined with strong underwriting, we are better able to weather market changes.

Market Diversity

Considered by some to be a single Southeastern market, our market actually consists of several highly distinctive areas. Thus, our loan portfolio reflects that geographic diversity. We know that the economic health of markets can vary from region to region. Consequently, we believe that our wide geographic diversity will allow our overall portfolio to fare well during challenging national economic conditions.