**UNITED        STATES **

**SECURITIES        AND EXCHANGE COMMISSION**

**WASHINGTON,        D.C. 20549**

**FORM        10-K/A**

**x        ANNUAL REPORT PURSUANT        TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF        1934**

**o        TRANSITIONAL REPORT        UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF        1934**

**CRESCENT        FINANCIAL CORPORATION**

| NORTH                    CAROLINA                  | 56-2259050                             |
|----------------------------------------------------|----------------------------------------|
| (State                    or Other Jurisdiction of | (I.R.S.                    Employer    |
| Incorporation                    or Organization)  | Identification                    No.) |

**NONE**

**COMMON        STOCK, PAR VALUE $1.00 PER SHARE**

| Large                  accelerated filer | o                                                                | Accelerated                  filer         | x |
|------------------------------------------|------------------------------------------------------------------|--------------------------------------------|---|
| Non-accelerated                  filer   | o                  (Do not check if a smaller reporting company) | Smaller                  reporting company | o |

**Documents        Incorporated by Reference. **

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**EXPLANATORY        NOTE**

**ITEM        1**
**5        - Exhibits, financial statement schedules **

**(a)**

**(1)        and (2)**
**Lists        of Financial Statements and Schedules**

| ·   | Consolidated                Balance Sheets as of December 31, 2007 and December 31,                2006 |
|--------------------|---------------------------------------------------------------------------------------------------------|
| ·   | Consolidated                Statements of Operations for the years ended December 31, 2007, 2006                and                2005 |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------|
| ·   | Consolidated                Statements of Changes in Stockholders’ Equity for the years ended December                31, 2007, 2006 and 2005 |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | Consolidated                Statements of Cash Flows for the years ended December 31, 2007, 2006                and                2005 |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------|
| ·   | Notes                to Consolidated Financial Statements |
|--------------------|-----------------------------------------------------------|
| ·   | Report                of Independent Registered Public Accounting                Firm |
|--------------------|---------------------------------------------------------------------------------------|

**(3)**
**Listing        of Exhibits**

| ·   | 1999                Incentive Stock Option Plan |
|--------------------|-------------------------------------------------|
| ·   | 1999                Nonqualified Stock Option Plan for                Directors |
|--------------------|---------------------------------------------------------------------------------|
| ·   | Employment                Agreement between the Registrant and Michael G.                Carlton |
|--------------------|--------------------------------------------------------------------------------------------------|
| ·   | Employment                Agreement between the Registrant and Bruce W.                Elder |
|--------------------|----------------------------------------------------------------------------------------------|
| ·   | Employment                Agreement between the Registrant and Thomas E. Holder,                Jr. |
|--------------------|-----------------------------------------------------------------------------------------------------|
| ·   | Employment                Agreement between the Registrant and Ray D.                Vaughn |
|--------------------|---------------------------------------------------------------------------------------------|
| ·   | Employment                Agreement between the Registrant and W. Keith                Betts |
|--------------------|----------------------------------------------------------------------------------------------|
| ·   | Salary                Continuation Agreement with Michael G.                Carlton |
|--------------------|-------------------------------------------------------------------------------------|
| ·   | Salary                Continuation Agreement with Bruce W.                Elder |
|--------------------|---------------------------------------------------------------------------------|
| ·   | Salary                Continuation Agreement with Thomas E. Holder,                Jr. |
|--------------------|----------------------------------------------------------------------------------------|
| ·   | Salary                Continuation Agreement with Ray D. Vaughn |
|--------------------|-----------------------------------------------------------------|
| ·   | Salary                Continuation Agreement with W. Keith                Betts |
|--------------------|---------------------------------------------------------------------------------|
| ·   | Endorsement                Split Dollar Agreement with Michael G.                Carlton |
|--------------------|------------------------------------------------------------------------------------------|
| ·   | Endorsement                Split Dollar Agreement with Bruce W.                Elder |
|--------------------|--------------------------------------------------------------------------------------|
| ·   | Endorsement                Split Dollar Agreement with Thomas E. Holder,                Jr. |
|--------------------|---------------------------------------------------------------------------------------------|
| ·   | Endorsement                Split Dollar Agreement with Ray D. Vaughn |
|--------------------|----------------------------------------------------------------------|
| ·   | Endorsement                Split Dollar Agreement with W. Keith                Betts |
|--------------------|--------------------------------------------------------------------------------------|
| ·   | Crescent                State Bank Directors’ Compensation Plan |
|--------------------|-----------------------------------------------------------------------|
| ·   | 2006                Omnibus Stock Ownership and Long Term Incentive                Plan |
|--------------------|-----------------------------------------------------------------------------------------|

**(b)**
**Exhibits**

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**SIGNATURES**

**CRESCENT        FINANCIAL CORPORATION**

|                    /s/ Michael G. Carlton        Michael                  G. Carlton, President and Chief                  Executive Officer, Director   | April                  29, 2008 |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------|
|                                                                                                                                                                                                  |                            |
|                    /s/ Bruce W. Elder           Bruce                  W. Elder, Vice President(Principal                  Accounting Officer) | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ Brent D. Barringer         Brent                  D. Barringer, Director                                                          | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ William H. Cameron      William                  H. Cameron, Director                                                                       | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ Bruce I. Howell          Bruce                  I. Howell, Director                                                     | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ James A. Lucas          James                  A. Lucas, Director                                                       | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ Kenneth A. Lucas         Kenneth                  A. Lucas, Director                                                              | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ Sheila Hale Ogle         Sheila                  Hale Ogle, Director                                                         | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ Charles A. Paul             Charles                  A. Paul, Director                                   | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ Francis R. Quis, Jr.         Francis                  R. Quis, Jr., Director                                                 | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ Jon S. Rufty            Jon                  S. Rufty, Director                                               | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ Jon T. Vincent            Jon                  T. Vincent, Director                                                | April                  29, 2008 |
|                                                                                                                                                                                                  |                            |
|                    /s/ Stephen K. Zaytoun      Stephen                  K. Zaytoun, Director                                                                       | April                  29, 2008 |

----

**EXHIBIT        INDEX**

| **Exhibit**** ****Number** |   |  **Exhibit**                                                                                            |   |
|---------------------------------|--------|--------------------------------------------------------------------------------------------------------------|--------|
|                            |   |                                                                                                         |   |
| 3(i)                            |   | Articles                  of Incorporation.                                                                  | *      |
|                            |   |                                                                                                         |   |
| 3(ii)                           |   | Bylaws                                                                                                       | *      |
|                            |   |                                                                                                         |   |
| 4                               |   | Form                  of Stock Certificate                                                                   | *      |
|                            |   |                                                                                                         |   |
| 10(i)                           |   | 1999                  Incentive Stock Option Plan                                                            | **     |
|                            |   |                                                                                                         |   |
| 10(ii)                          |   | 1999                  Nonqualified Stock Option Plan                                                         | **     |
|                            |   |                                                                                                         |   |
| 10(iii)                         |   | Employment                  Agreement Michael G. Carlton                                                     | *****  |
|                            |   |                                                                                                         |   |
| 10(iv)                          |   | Employment                  Agreement of Bruce W. Elder                                                      | *****  |
|                            |   |                                                                                                         |   |
| 10(v)                           |   | Employment                  Agreement of Thomas E. Holder, Jr.                                               | *****  |
|                            |   |                                                                                                         |   |
| 10(vi)                          |   | Amended                  and Restated Trust Agreement of Crescent Financial Capital Trust                  I | ***    |
|                            |   |                                                                                                         |   |
| 10(vii)                         |   | Indenture                                                                                                    | ***    |
|                            |   |                                                                                                         |   |
| 10(viii)                        |   | Junior                  Subordinated Debenture                                                               | ***    |
|                            |   |                                                                                                         |   |
| 10(ix)                          |   | Guarantee                  Agreement                                                                         | ***    |
|                            |   |                                                                                                         |   |
| 10(x)                           |   | Salary                  Continuation Agreement with Michael G. Carlton                                       | *****  |
|                            |   |                                                                                                         |   |
| 10(xi)                          |   | Salary                  Continuation Agreement with Bruce W. Elder                                           | *****  |
|                            |   |                                                                                                         |   |
| 10(xii)                         |   | Salary                  Continuation Agreement with Thomas E. Holder, Jr.                                    | *****  |
|                            |   |                                                                                                         |   |
| 10(xiii)                        |   | Endorsement                  Split Dollar Agreement with Michael G. Carlton                                  | ***    |
|                            |   |                                                                                                         |   |
| 10(xiv)                         |   | Endorsement                  Split Dollar Agreement with Bruce W. Elder                                      | ***    |
|                            |   |                                                                                                         |   |
| 10(xv)                          |   | Endorsement                  Split Dollar Agreement with Thomas E. Holder, Jr.                               | ***    |
|                            |   |                                                                                                         |   |
| 10(xvi)                         |   | Crescent                  State Bank Directors’ Compensation Plan                                      | ****   |
|                            |   |                                                                                                         |   |
| 10(xvii)                        |   | Salary                  Continuation Agreement with Ray D. Vaughn                                            | *****  |
|                            |   |                                                                                                         |   |
| 10(xviii)                       |   | Salary                  Continuation Agreement with W. Keith Betts                                           | *****  |
|                            |   |                                                                                                         |   |
| 10(xix)                         |   | Employment                  Agreement with Ray D. Vaughn                                                     | *****  |
|                            |   |                                                                                                         |   |
| 10(xx)                          |   | Employment                  Agreement of W. Keith Betts                                                      | *****  |
|                            |   |                                                                                                         |   |
| 10(xxi)                         |   | Endorsement                  Split Dollar Agreement with Ray D. Vaughn.                                      | *****  |
|                            |   |                                                                                                         |   |
| 10(xxii)                        |   | Endorsement                  Split Dollar Agreement with W. Keith Betts.                                     | *****  |
|                            |   |                                                                                                         |   |

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| 21     | Subsidiaries                                                                                                                                       | *****                           |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------|
|   |                                                                                                                                               |                            |
| 23     | Consent                  of Dixon Hughes PLLC                                                                                                      | *****                           |
|   |                                                                                                                                               |                            |
| 31(i)  | Certification                  of Principal Executive Officer Pursuant to Section 302 of the Sarbanes                  Oxley Act                   | Filed                  herewith |
|   |                                                                                                                                               |                            |
| 31(ii) | Certification                  of Principal Accounting Officer Pursuant to Section 302 of the                  Sarbanes                  Oxley Act | Filed                  herewith |
|   |                                                                                                                                               |                            |
| 32(i)  | Certification                  of Principal Executive Officer Pursuant to Section 906 of the Sarbanes                  Oxley Act                   | *****                           |
|   |                                                                                                                                               |                            |
| 32(ii) | Certification                  of Principal Accounting Officer Pursuant to Section 906 of the                  Sarbanes                  Oxley Act | *****                           |
|   |                                                                                                                                               |                            |
| 99(i)  | Registrant’s                  Proxy Statement for the 2007 Annual Meeting of                  Shareholders                                   | ******                          |

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