Union First Market Bankshares Reports First Quarter Results

RICHMOND, Va., April 24, 2012 /PRNewswire/ -- Union First Market Bankshares Corporation (the "Company") (NASDAQ: UBSH) today reported net income of $7.9 million and earnings per share of $0.31 for its first quarter ended March 31, 2012.  The quarterly results represent a decrease of $437,000 in net income, but earnings per share increased $0.03 from the fourth quarter 2011 as a result of the redemption of preferred stock in December 2011.  The quarterly results represent an increase of $1.7 million in net income or $0.09 in earnings per share from the quarter ended March 31, 2011.  Net income available to common shareholders was $7.9 million, compared to $5.7 million for the prior year's first quarter which included dividends and discount accretion on preferred stock of $526,000.

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"Union First Market Bankshares delivered another solid quarter as it continues to build upon its growth strategy.  As consumers continued to look to find a better place to bank, Union First Market Bank saw an increase of approximately $40 million in deposits and new customer growth of nearly 1,300 net new households from the prior quarter," said G. William Beale, chief executive officer of Union First Market Bankshares.  "I am encouraged that net loans grew for the second quarter in a row despite the continued consumer loan portfolio run-off.  While we remain committed to growing the business, the Company is focused on controlling expenses and announced the closing of four branches during the quarter.  Finally, I am excited about the new mortgage teammates who joined Union during the quarter.  The new teammates are getting up to speed quickly and are already starting to generate new business for the Company."

Select highlights:

  • The Company's results generated a Return on Average Equity ("ROE") of 7.51% and Return on Average Assets ("ROA") of 0.82% for the quarter ended March 31, 2012.  ROE and ROA were 5.81% and 0.66%, respectively, for the quarter ended March 31, 2011.
  • Loan demand improved slightly with an increase in loans outstanding of $23.2 million or nearly 1% over year end balances.
  • Provision for loan losses increased $1.1 million from the most recent quarter but was $2.8 million lower than the quarter ending March 31, 2011.
  • Total deposits grew $40.6 million, or 1.3%, when compared to December 31, 2011.
  • In early 2012, the Company's wholly owned subsidiary, Union Mortgage Group ("UMG"), hired 28 mortgage loan originators.  These new originators were assigned to UMG's existing mortgage office in Virginia Beach.  These originators were formerly employed by a national mortgage company that announced in November 2011 it was exiting the mortgage origination business. 

First quarter net income decreased $437,000, or 5.2%, compared to the fourth quarter in the prior year.  The decrease is largely a result of higher salary and benefit expenses partially offset by lower losses on sales of OREO and other Bank property in relation to the prior quarter, lower marketing and advertising costs, lower overdraft losses and recoveries, and lower FDIC insurance expense.  In addition, the Company recorded an additional $1.1 million in provision for loan losses above the prior quarter.  Also during the quarter, interest income declined at a faster pace than interest expense, a result of a lack of higher yield loan and investment options in the current low-rate market.

Net income for the quarter ended March 31, 2012 increased $1.7 million, or 27.9%, from the prior year.  The increase was principally a result of a lower provision for loan losses, and to a lesser extent, an increase in account service charges and fees, favorable gains on sales of mortgage loans, and lower FDIC insurance assessment, partially offset by higher salary expense of additional employees.

NET INTEREST INCOME

On a linked quarter basis, tax-equivalent net interest income was $39.4 million, a decrease of $167,000, or 0.4%, from the fourth quarter of 2011.  This decrease was principally due to lower average interest-earning asset balances offset by lower costs of interest-bearing liabilities.  First quarter tax-equivalent net interest margin increased to 4.44% from 4.37% compared to the most recent quarter.  The change in net interest margin was principally attributable to an increase in investment yields and lower cost of interest-bearing liabilities partially offset by lower loan yields.  Loan yields continue to be affected negatively by competitive pricing while yields on investment securities benefitted from a slow- down of prepayments related to taxable securities during the quarter.  The cost of interest-bearing deposits was affected positively by a shift in mix from term deposits to transaction deposits.

The following table shows average interest-earning assets, interest-bearing liabilities, the related income/expense and change for the periods shown:











Linked quarter results







Dollars in thousands







Three Months Ended






03/31/12

12/31/11

Change










Average interest-earning assets


$ 3,578,513

$                    3,591,739

$ (13,226)



Interest income


$      46,919

$                         47,386

$      (467)



Yield on interest-earning assets


5.27%

5.23%

4

bps


Average interest-bearing liabilities


$ 2,908,822

$                    2,906,758

$    2,064



Interest expense


$        7,528

$                           7,828

$      (300)



Cost of interest-bearing liabilities


1.04%

1.07%

(3)

bps









For the three months ended March 31, 2012, tax-equivalent net interest income decreased $509,000, or 1.3%, when compared to the same period last year.  The tax-equivalent net interest margin decreased to 4.44% from 4.68% in the prior year.  This decrease was principally due to a decline in income from interest-earning assets outpacing lower costs on interest-bearing liabilities.  Lower interest-earning asset income was principally due to lower yields on loans and investment securities as new loans are originated at lower rates and cash flows from securities investments and loans are reinvested at lower yields. 

The Company continues to expect that its net interest margin will decline slightly over the next several quarters as decreases in earning asset yields are expected to outpace declines in costs of interest-bearing liabilities.

The following table shows average interest-earning assets, interest-bearing liabilities, the related income/expense and change for the periods shown:











Year-over-year results







Dollars in thousands







Three Months Ended






03/31/12

03/31/11

Change










Average interest-earning assets


$ 3,578,513

$                    3,459,834

$ 118,679



Interest income


$      46,919

$                         48,490

$   (1,571)



Yield on interest-earning assets


5.27%

5.68%

(41)

bps


Average interest-bearing liabilities


$ 2,908,822

$                    2,858,406

$   50,416



Interest expense


$        7,528

$                           8,591

$   (1,063)



Cost of interest-bearing liabilities


1.04%

1.22%

(18)

bps
















Acquisition Activity – Net Interest Margin

The favorable impact of acquisition accounting fair value adjustments on net interest income was $1.3 million ($1.1 million – First Market Bank ("FMB"); $214,000Harrisonburg branch) for the three months ended March 31, 2012.  If not for this favorable impact, the net interest margin for the first quarter would have been 4.28%, compared to 4.20% from the fourth quarter of 2011. 

The acquired loan portfolios of the Harrisonburg Branch and FMB were marked-to-market with a fair value discount to market rates.  Performing loan discount accretion is recognized as interest income over the estimated remaining life of the loans.  For the FMB acquisition, the acquired investment security portfolios were marked-to-market with a fair value discount to market rates.  The Company also assumed borrowings (Federal Home Loan Bank ("FHLB")) and subordinated debt.  These liabilities were marked-to-market with estimates of fair value on acquisition date.  The resulting discount/premium to market is accreted/amortized as an increase/decrease to net interest income over the estimated lives of the liabilities.  Additional credit quality deterioration above the original credit mark is recorded as additional provisions for loan losses.  The Company also assumed certificates of deposit at a premium to market.  These were marked-to-market with estimates of fair value on acquisition date.  The resulting premium to market is being amortized as a decrease to interest expense over the estimated lives of the certificates of deposit.

The first quarter and remaining estimated discount/premium are reflected in the following table (dollars in thousands):





















Harrisonburg Branch


 First Market Bank  






















Loan Accretion


Certificates of Deposit


Loan Accretion


Investment Securities


Borrowings


Certificates of Deposit


















For the quarter ended March 31, 2012




$              211


$                               3


$             1,049


$                            62


$         (122)


$                            114


For the remaining nine months of 2012




377


8


2,576


139


(367)


108


For the years ending:
















2013




148


7


2,377


15


(489)


-


2014




37


4


1,478


-


(489)


-


2015




26


-


570


-


(489)


-


2016




27


-


28


-


(163)


-


2017




23


-


-


-


-


-


Thereafter




120


-


-


-


-


-


















ASSET QUALITY/LOAN LOSS PROVISION

Overview

During the first quarter, the Company continued to monitor asset quality and take appropriate action to manage nonperforming assets and related loss exposure.  The reduced levels of nonaccrual loans were favorable while OREO balances increased as a result of a small number of larger loans, principally related to commercial real estate, transferred to OREO that were not in nonaccrual status during the previous quarter. Economic conditions are showing improvement and while the future remains uncertain, the Company's reduced trends in provisions for loan losses, increased allowance to nonperforming loans coverage ratio, and decreased levels of troubled debt restructurings and impaired loans demonstrate that its dedicated efforts to improve asset quality continue to have a positive impact.  The magnitude of any change in the real estate market and its impact on the Company is still largely dependent upon continued recovery of commercial real estate and residential housing and the pace at which the local economies in the Company's operating markets recover.

Nonperforming Assets ("NPAs")

At March 31, 2012, nonperforming assets totaled $80.1 million, an increase of $3.0 million from the fourth quarter of last year and a decrease of $21.2 million compared to a year ago.  In addition, NPAs as a percentage of total outstanding loans increased 8 basis points from 2.74% in the fourth quarter of last year and declined 79 basis points from 3.61% in the first quarter of the prior year to 2.82% at March 31, 2012.  The current quarter increase in NPAs from the fourth quarter of last year related to a net increase in OREO of $5.4 million, partially offset by a net decrease in nonaccrual loans, excluding purchased impaired loans, of $2.4 million.   

Nonperforming assets at March 31, 2012 included $42.4 million in nonaccrual loans (excluding purchased impaired loans), a net decrease of $2.4 million, or 5.36%, from the prior quarter.  The following table shows the activity in nonaccrual loans for the quarter ended (dollars in thousands): 









March 31, 2012


December 31, 2011


March 31, 2011


Beginning Balance

$ 44,834


$        51,965


$  61,716


Net customer payments

(2,778)


(6,556)


(2,163)


Additions

2,805


5,364


8,567


Charge-offs

(1,549)


(2,304)


(1,563)


Loans returning to accruing status

-


(1,950)


(502)


Transfers to OREO

(921)


(1,685)


(3,413)


Ending Balance

$ 42,391


$        44,834


$  62,642









The nonperforming loans added during the quarter were principally related to commercial real estate and mortgages as borrowers continued to experience financial difficulties with the prolonged economic recovery exhausting their cash reserves and other repayment sources. 

The following table presents the composition of nonaccrual loans (excluding purchased impaired loans) and the coverage ratio, which is the allowance for loan losses expressed as a percentage of nonaccrual loans, at the quarter ended (dollars in thousands):









March 31, 2012


December 31, 2011


March 31, 2011


Raw Land and Lots

$ 13,064


$        13,322


$  22,808


Commercial Construction

9,835


10,276


11,489


Commercial Real Estate

6,299


7,993


10,015


Single Family Investment Real Estate

4,507


5,048


9,340


Commercial and Industrial

5,318


5,297


4,899


Other Commercial

233


238


509


Consumer

3,135


2,660


3,582


Total

$ 42,391


$        44,834


$  62,642









Coverage Ratio

94.84%


88.04%


64.49%









Impairment analyses provided appropriate reserves on these nonperforming loans while appropriate reserves on homogenous pools continue to be maintained.  The increase in the coverage ratio is primarily related to a decline in nonperforming loans.

Nonperforming assets at March 31, 2012 also included $37.7 million in OREO, a net increase of $5.4 million, or 16.72%, from the prior quarter.  The following table shows the activity in OREO for the quarter ended (dollars in thousands):









March 31, 2012


December 31, 2011


March 31, 2011


Beginning Balance

$ 32,263


$        34,464


$  36,122


Additions

6,593


2,543


6,406


Capitalized Improvements

319


197


37


Valuation Adjustments

-


(530)


(12)


Proceeds from sales

(1,485)


(3,674)


(3,580)


Gains (losses) from sales

(27)


(737)


(299)


Ending Balance

$ 37,663


$        32,263


$  38,674
















The additions were principally related to residential and commercial real estate; sales from OREO were principally related to residential real estate and lots. 

The following table presents the composition of the OREO portfolio at the quarter ended (dollars in thousands):









March 31, 2012


December 31, 2011


March 31, 2011


Land

$  6,327


$          6,327


$    8,885


Land Development

11,559


11,309


12,192


Residential Real Estate

12,482


11,024


15,345


Commercial Real Estate

6,275


2,583


1,232


Land Previously Held for Branch Sites

1,020


1,020


1,020


Total

$ 37,663


$        32,263


$  38,674
















Included in land development is $9.1 million related to a residential community in the Northern Neck region of Virginia, which includes developed residential lots, a golf course, and undeveloped land.  Foreclosed properties were adjusted to their fair values at the time of each foreclosure and any losses were taken as loan charge-offs against the allowance for loan losses at that time.  OREO asset valuations are also evaluated at least quarterly and any necessary write downs to fair values are recorded as impairment. 

Charge-offs

For the quarter ended March 31, 2012, net charge-offs of loans were $2.8 million, or 0.39%, on an annualized basis, compared to $4.2 million, or 0.59%, for the fourth quarter of 2011 and $4.3 million, or 0.62%, for the same quarter last year.  Net charge-offs in the current quarter included commercial loans of $1.3 million and consumer loans of $1.5 million.  At March 31, 2012, total accruing past due loans were $41.0 million, or 1.44%, of total loans, a slight increase from 1.40% at December 31, 2011 and a decrease from 1.52% a year ago. 

Provision

The provision for loan losses for the current quarter was $3.5 million, an increase of $1.1 million from the fourth quarter of last year and a $2.8 million decrease from the same quarter a year ago.  The increased provision from the most recent quarter reflects the need to increase reserves on impaired loans.  While the impaired loan balances declined, the reserve requirements increased as management continued to monitor collateral values and guarantor support.  The current level of the allowance for loan losses reflects specific reserves related to nonperforming loans, current risk ratings on loans, net charge-off activity, loan growth, delinquency trends, and other credit risk factors that the Company considers in assessing the adequacy of the allowance for loan losses. 

The allowance for loan losses as a percentage of the total loan portfolio, including net loans acquired in the FMB and the Harrisonburg branch acquisitions, was 1.41% at March 31, 2012, 1.40% at December 31, 2011, and 1.44% at March 31, 2011.  The allowance for loan losses as a percentage of the total loan portfolio, adjusted for acquired loans, was 1.77% at March 31, 2012, a decrease from 1.83% at December 31, 2011 and 1.96% from year ago.  While the allowance for loan losses as a percentage of the adjusted loan portfolio declined, the nonaccrual loan coverage ratio significantly improved, as it increased from 88.04% at December 31, 2011 and from 64.49% the same quarter last year to 94.84% at March 31, 2012.  The rise in the coverage ratio, which is at the highest level since the first quarter of 2010, further shows that management's proactive diligence in working through problem credits is having a positive impact on asset quality.  The lower allowance for loan losses as a percentage of loans compared to the loan portfolio, adjusted for acquired loans, is related to the elimination of FMB's allowance for loan losses at acquisition.  In acquisition accounting, there is no carryover of previously established allowance for loan losses.

Troubled Debt Restructurings ("TDRs")

The total recorded investment in TDRs as of March 31, 2012 was $99.8 million, a decrease of $12.8 million from $112.6 million at December 31, 2011.  Of the $99.8 million of TDRs at March 31, 2012, $86.1 million, or 86.27%, were considered performing while the remaining $13.7 million were considered nonperforming.  The primary cause for the decline in TDRs is related to restructured loans with a market rate of interest at the time of the restructuring; these loans were considered performing in accordance with their modified terms for a consecutive twelve month period and were no longer considered impaired. 

The following table shows the Company's performing and nonperforming TDRs by modification type for the quarter ended (dollars in thousands):
















3/31/2012


12/31/2011


9/30/2011


Performing







Modified to interest only

$   1,812


$       699


$       839


Term modification, at a market rate

75,455


87,920


91,039


Term modification, below market rate

8,797


10,215


10,254


Total performing

$ 86,064


$   98,834


$ 102,132









Nonperforming







Modified to interest only

$     649


$    1,190


$       658


Term modification, at a market rate

4,290


3,660


4,187


Term modification, below market rate

8,804


8,954


9,398


Total nonperforming

$ 13,743


$   13,804


$  14,243









Total performing & nonperforming

$ 99,807


$ 112,638


$ 116,375
















NONINTEREST INCOME

On a linked quarter basis, noninterest income increased $95,000, or 0.8%, to $11.8 million from $11.7 million in the fourth quarter.  During the first quarter, the Company incurred approximately $1.0 million lower losses on disposal of Bank owned property, primarily related to the Company's recorded loss of $351,000 on disposal of bank premises and incurred losses on sales of OREO of $737,000 in the prior quarter.  Also during the prior quarter, the Company recorded gains on sales of investment securities of $430,000.  Gains on sales of mortgage loans decreased $412,000, or 7.2%, and were driven by compressed loan margins related to refinance volume.  Excluding sales of Bank owned real estate, property, mortgage segment operations, and securities transactions, noninterest income decreased $95,000 or 1.4%.

For the quarter ended March 31, 2012, noninterest income increased $1.3 million, or 12.1%, to $11.8 million from $10.5 million in the prior year's same quarter.  Service charges on deposit accounts and other account fees increased $558,000, related to higher VISA interchange fee income, overdraft and return check charges, letter of credit fees, and ATM charges. Gains on sales of mortgage loans increased $328,000, or 6.6%, due to higher origination volume.  During the first quarter 2011, the Company recorded losses on sales of OREO of $299,000 compared to $27,000 in the current quarter. Other operating income increased $133,000 primarily as a result of higher trust services income.  Excluding the mortgage segment operations and prior year losses on sales of OREO, noninterest income increased $690,000 or 11.5%, from the same period a year ago.




















 For the Three Months Ended 



03/31/12

12/31/11

$

%

03/31/11

$

%


Noninterest income:









Service charges on deposit accounts

$  2,130

$  2,258

(128)

-5.7%

$  2,058

$     72

3.5%


Other service charges, commissions and fees

3,410

3,296

114

3.5%

2,924

486

16.6%


Gains on securities transactions, net

(5)

430

(435)

-101.2%

(16)

11

-68.8%


Gains on sales of loans

5,296

5,708

(412)

-7.2%

4,968

328

6.6%


Gains (losses) on sales of other real estate owned and bank premises, net

(58)

(1,088)

1,030

-94.7%

(299)

241

-80.6%


Other operating income

1,045

1,119

(74)

-6.6%

912

133

14.6%


Total noninterest income

$11,818

$11,723

$   95

0.8%

$10,547

$1,271

12.1%




















NONINTEREST EXPENSE

On a linked quarter basis, noninterest expense decreased $744,000, or 2.0%, to $35.6 million from $36.4 million when compared to the fourth quarter of 2011.  Other operating expenses decreased $1.7 million, or 12.7%.  Included in the decrease were lower OREO expenses of $575,000, primarily related to writedowns of $529,000 which occurred in the prior quarter, and lower marketing and advertising costs. Also adding to the decline were lower overdraft losses and favorable charge-off recoveries of $322,000 in the current quarter, and $230,000 lower FDIC insurance expense.  Salaries and benefits expense increased $1.2 million related to timing of annual merit increases, the effect of certain annual salary tax caps effective in the prior quarter, and severance payments to affected employees.  Excluding the mortgage segment operations, noninterest expense decreased $1.0 million, or 3.2%, compared to the fourth quarter of the prior year.

For the quarter ended March 31, 2012, noninterest expense increased $842,000, or 2.4%, to $35.6 million from $34.8 million for the first quarter of 2011.  Salaries and benefits expenses increased $1.9 million primarily related to increased salary costs of $1.3 million related to additional personnel in acquired branches, higher group insurance costs of $216,000 due to additional employees and cost increases, higher profit sharing of $143,000 based on higher net income, and other employee benefit expenses of $225,000 related to severance payments to affected employees.  Other operating expenses decreased $1.0 million, or 7.9%.  This expense decrease included lower FDIC insurance expense of $1.0 million based on lower assessment and rate, lower amortization expense on the acquired deposit portfolio of $345,000, and lack of conversion costs in the current quarter compared to $294,000 in the first quarter 2011.  Partially offsetting these decreases were higher marketing and advertising costs of $305,000 for free checking account campaigns and higher account service costs of $196,000.  Excluding the mortgage segment operations, noninterest expense increased $832,000, or 2.8%, compared to the first quarter of 2011.











 For the Three Months Ended 



03/31/12

12/31/11

$

%

03/31/11

$

%


Noninterest expense:









Salaries and benefits

$ 19,507

$ 18,342

$  1,165

6.3%

$ 17,654

$ 1,853

10.5%


Occupancy expenses

2,647

2,797

(150)

-5.4%

2,754

(107)

-3.9%


Furniture and equipment expenses

1,763

1,823

(60)

-3.3%

1,662

101

6.1%


Other operating expenses

11,692

13,390

(1,698)

-12.7%

12,697

(1,005)

-7.9%


Total noninterest expense

$ 35,609

$ 36,352

$   (744)

-2.0%

$ 34,767

842

2.4%











Mortgage segment operations

$ (5,232)

$ (4,969)

$   (264)

5.3%

$ (4,928)

$  (304)

6.2%


Acquisition and conversion costs

-

-

-

-

(294)

294

-100.1%


Other non-recurring costs

-

-

-

-

-

-

-


Intercompany eliminations

117

117

-

0.0%

117

-

0.0%



$ 30,494

$ 31,501

$(1,008)

-3.2%

$ 29,662

$   832

2.8%




















BALANCE SHEET

At March 31, 2012, total cash and cash equivalents were $111.2 million, an increase of $14.5 million from December 31, 2011, and an increase of $26.4 million from March 31, 2011.  During the fourth quarter, the Company paid the Treasury $35.7 million to redeem the Preferred Stock issued to the Treasury and assumed in the FMB acquisition.  At March 31, 2012, investment in securities increased $60.1 million when compared to prior year's first quarter.  At March 31, 2012, net loans were $2.8 billion, an increase of $22.4 million from the prior quarter, and an increase of $35.0 million from March 31, 2011.  Mortgage loans held for sale of $73.6 million decreased by $1.2 million, virtually unchanged from the prior quarter, and an increase of $23.0 million from March 31, 2011.  At March 31, 2012, total assets were $3.9 billion, an increase of $40.7 million compared to the fourth quarter, and an increase of $135.1 million from $3.8 billion at March 31, 2011. 

For three months ended March 31, 2012, total deposits grew $40.6 million, or 1.3%, when compared to December 31, 2011, and grew $149.1 million, or 4.9%, from March 31, 2011.  Of this amount, interest- bearing deposits increased $10.3 million compared to the fourth quarter driven by higher volumes in NOW and savings accounts.  Similarly, interest-bearing deposits increased $91.8 million from March 31, 2011, as money market, NOW accounts, and saving accounts balances increases were partially offset by runoff in certificates of deposit.  Total borrowings, including repurchase agreements, decreased $9.8 million on a linked quarter basis and decreased $12.7 million from March 31, 2011 as the Company experienced lower demand for securities sold under agreements for repurchase.  The Company's equity to assets ratio was 10.79% and 11.42% at March 31, 2012 and 2011, respectively.  The decrease in the equity to assets ratio was due to the Company's redemption of the preferred stock described above.  The Company's tangible common equity to tangible assets ratio was 8.97% and 8.51% at March 31, 2012 and 2011, respectively.

MORTGAGE SEGMENT INFORMATION

On a linked quarter basis, the mortgage segment net income for the first quarter decreased $420,000, or 64.2%, from $654,000 in the fourth quarter to $234,000, related to lower gains on sale of loans and additional salary and benefits expense.  Gains on the sale of loans decreased $412,000, or 7.2%, due to compressed loan margins driven by refinance loan volume.  During the quarter, the Company hired additional loan originators and support personnel who were formerly employed by a national mortgage company that exited the mortgage origination business. As a result, salary and benefit expenses increased $383,000.  Originations decreased by $2.6 million from $186.6 million to $184.0 million, or 1.4%, from the fourth quarter.  Refinanced loans represented 56.5% of the originations during the first quarter compared to 52.2% during the fourth quarter.  Loan related expenses were $172,000, decreasing $126,000, or 42.3% from the prior quarter as a result of write offs of uncollectible appraisals in the previous quarter.

For the three months ended March 31, 2012, the mortgage segment net income decreased $94,000 from $328,000 to $234,000, or 28.7%, compared to the same period last year primarily due to narrower loan margins and higher salaries and benefits expense for additional personnel described above.  Originations increased by $34.9 million from $149.1 million to $184.0 million, or 23.4%, from the first quarter last year.  As a result, gains on the sale of loans increased $328,000, or 6.6%.  Refinanced loans represented 56.5% of originations during the first quarter of 2012 compared to 38.1% during the same period a year ago.  Salaries and benefits increased $253,000 primarily as a result of additional personnel. In addition, interest income declined by $179,000, or 36.8% due to an increase in the warehouse line of credit borrowing rate.

ABOUT UNION FIRST MARKET BANKSHARES CORPORATION

Headquartered in Richmond, Virginia, Union First Market Bankshares Corporation is the holding company for Union First Market Bank, which has 98 branches and more than 160 ATMs throughout Virginia.  Non-bank affiliates of the holding company include: Union Investment Services, Inc., which provides full brokerage services; Union Mortgage Group, Inc., which provides a full line of mortgage products, and Union Insurance Group, LLC, which offers various lines of insurance products.  Union First Market Bank also owns a non-controlling interest in Johnson Mortgage Company, L.L.C. 

Additional information is available on the Company's website at http://investors.bankatunion.com.  Shares of the Company's common stock are traded on the NASDAQ Global Select Market under the symbol UBSH.

FORWARD-LOOKING STATEMENTS