Proven Results

Colonial’s 2007 results reflect a great deal of hard work, commitment and patience as we managed through one of the most volatile banking environments in recent times. We are proud that our time-tested strategy and seasoned leadership led us away from the sub-prime problems that impacted many financial institutions in 2007. As such, these results may be an even better indicator of our success as a company than our performance in previous years.

Despite the unprecedented challenges in the banking environment, we continued to expand our retail banking franchise. Our acquisitions of Citrus & Chemical and Commercial Bank in Florida contributed to our record $26 billion in total assets at the end of 2007. At the same time, we kept tight control of our noninterest expenses to the point that our costs for salaries and benefits declined in 2007.

One indicator of the strength of our retail franchise is the 15% increase in core noninterest income in 2007 over 2006. One of the highlights of our increase in fee-based revenue was 19% growth in financial planning services revenue as compared to 2006. Colonial’s financial planning division provides a full breadth of asset management and estate planning solutions, money management products and insurance products. In addition, it offers resources, expertise and personal service to help private banking clients achieve their financial goals.

Mortgage banking fees also increased in 2007, by 10%. Our mortgage bankers are all employees of Colonial and originate mortgages primarily through our retail branch system. At the end of 2007, we were able to take advantage of the disruption in the mortgage banking market and recruit a team of mortgage originators in the Atlanta area. We look forward to increased revenues in this line of business.

Florida still holds a wealth of banking opportunities as people continue to migrate to the state. In fact, we expect our Florida markets will recover faster than the nation as the state continues to attract residents and jobs. Texas, one of the few bright spots in the national housing market, contributed considerably to our loan generation in 2007, and we expect it to continue to do so in 2008.

As we prepare to take advantage of these and other long-term growth opportunities, we will do so from a position of strength — growing markets, solid capital and a tight grip on expenses.