FNB United Corp.      Fourth Quarter 2012      March 20, 2013
 2   Presenters      Brian Simpson      Chief Executive Officer      David Nielsen      Chief Financial Officer      Neil Machovec      Chief Credit Officer
 3   Forward Looking Statements & Other Information   Forward Looking Statements      This presentation contains certain forward-looking statements within the safe harbor rules of the federal securities laws.   These statements generally relate to FNB’s financial condition, results of operations, plans, objectives, future performance or   business. They usually can be identified by the use of forward-looking terminology, such as “believes,” “expects,” or “are   expected to,” “plans,” “projects,” “goals,” “estimates,” “may,” “should,” “could,” “would,” “intends to,” “outlook” or “anticipates,”   or variations of these and similar words, or by discussions of strategies that involve risks and uncertainties. Forward looking   statements are subject to risks and uncertainties, including but not limited to, those risks described in FNB’s Annual Report   on Form 10-K for the year ended December 31, 2012 under the section entitled “Item 1A, Risk Factors,” and in other reports   that have been filed by FNB with the Securities and Exchange Commission. You are cautioned not to place undue reliance on   these forward-looking statements, which are subject to numerous assumptions, risks and uncertainties, and which change   over time. These forward-looking statements speak only as of the date of this presentation.  Actual results may differ   materially from those expressed in or implied by any forward looking statements contained in this presentation.   We assume   no duty to revise or update any forward-looking statements, except as required by applicable law.      Non-GAAP Financial Measures      In addition to the results of operations presented in accordance with Generally Accepted Accounting Principles (GAAP), FNB   management uses and this presentation contains or references, certain non-GAAP financial measures, such as core   earnings, core noninterest expense, core noninterest income, net interest income on a fully taxable equivalent basis, pro   forma total ALL and fair value mark, Granite purchased impaired  loan ALL and FV mark, Granite purchased contractual loan   ALL and FV mark and tangible shareholders’ equity. FNB believes  these non-GAAP financial measures provide information   useful to investors in understanding our underlying operational performance and our business and performance trends as   they facilitate comparisons with the performance of others in the financial services industry; however, these non-GAAP   financial measures should not be considered an alternative to GAAP. The non-GAAP financial measures contained within this   presentation should be read in conjunction with the audited financial statements and analysis as presented in FNB’s Annual   Report on Form 10-K as well as the unaudited financial statements and analyses as presented in FNB’s Quarterly Reports on   Forms 10-Q.  A reconciliation of non-GAAP measures to the most directly comparable GAAP measure is included within   tables in the presentation or with the appendix to this presentation.
 4   Key Accomplishments    Execution of our key priorities         ― Reduced problem assets by $73.8 million, or 34%, in 2012   ― NPAs fell from $216.4 million in 2011 to $142.6 million at year end 2012   ― OREO reduced $47.3 million (43%) to $63.1 million   ― $22.0 million or OREO was under contract at December 31, 2012   ― Continued implementation of “Back to Business” strategies   ― Pass rated loan portfolio increased $42.1 million (5%) in 2012   ― Residential mortgage originations of $168.5 million up 244% over 2011   ― Mortgage loan income increased to $2.1 million for 2012   ― 4Q 2012 mortgage income of $1.0 up 33% over 3Q 2012   ― Improvements in deposit portfolio   ― Grew low cost core, non-CD, deposits $59.3 million or 6% in 2012   ― Increased low-cost core to 60% of total deposits at year end 2012   ― Up from 51% at year end 2011 and 39% at year end 2010   ― Cost of interest bearing deposits fell 48 basis points in 2012 to 0.79%   ― Down from 1.27% in 2011 and 1.57% in 2010   ― Progress recognized in FDIC action to lift Bank of Granite Order      ― Core earnings of $4.4 million for 2012 versus $(11.6) million core   loss in 2011   ― 4Q 2012 core earnings of $1.8 million, up 96% over 3Q 2012   ― NIM increased to 2.95% in 2012, up 66 basis points over 2011   ― Core noninterest expense declined for 3rd consecutive quarter   ― 4Q 2012 core noninterest expense down $2.9 million (14%) versus 4Q 2011       Continued improvements in core   earnings
 5   Rebranding and Merger    Rebranding to be completed in 2Q   2013         ― New branding introduced in February 2013   ― All CommunityOne branches and ATMs converted   ― Granite to convert upon bank merger   ― New and streamlined deposit products   ― Parent company to be renamed CommunityOne Bancorp   ― Subject to shareholder vote at Annual Meeting in June 2013   ― Stock to trade under new ticker - COB   ― Expect to merge Granite into CommunityOne in 2Q 2013   ― Merger application filed March 1, 2013   ― Final step of our phased integration approach   ― Integrated technology platform in 3Q 2012   ― Converted Granite general ledger in 4Q 2012   ― Introduced streamlined product set in February 2013   ― Converted Granite teller platform in March 2013   ― Branch and operations center consolidation to occur in 2Q 2013   ― Merger synergies contribute to further reductions in core   noninterest expense in 2013       Merger to be completed in 2Q 2013
 6   Annual Operating Highlights       Net loss to common shareholders   was $40.0 million, a decrease of   $52.7 million (57%) from 2011    Net loss per common shareholder   fell to $1.87 in 2012 from $22.09 in   2011    Operating metrics were all improved   in 2012   ― Net interest income grew $21.7   million (55%)   ― Loan loss provision fell $53.3   million (79%)   ― Noninterest expense fell $14.8   million (12%)   ― Noninterest income was flat to   2011.  Net of securities gains,   gain on extinguishment of debt   and fair value swaps in both   years, noninterest income grew   $4.5 million (33%)    Net interest margin grew 66 basis   points from 2.29% in 2011 to 2.95% in   2012      Annual Performance Metrics   Dollars in thousands except per share data 2010 2011 2012   Net loss from continuing operations, net of taxes (130,421)$     (131,518)$     (39,978)$         Net loss to common shareholders (135,121)       (92,722)        (40,005)          (1,170.47)     (20.71)          (1.87)              Net loss to common shareholders per share (1,182.78)     (22.09)          (1.87)              Return on average assets (6.40%) (6.88%) (1.75%)   Return on average equity (191.26%) NM (34.88%)   Net interest margin 2.81% 2.29% 2.95%   Core noninterest expense to average assets 1 2.76% 3.37% 3.26%   1  Non-GAAP measure.  See Appendix for reconciliation to GAAP presentation.   Net loss from continuing operations to common   shareholders per share   Annual Results   Results of Operations   Dollars in thousands, except per share data 2010 2011 2012   Net interest income 51,650$        39,555$        61,280$          Provision for loan losses (132,755)       (67,362)        (14,049)          Noninterest income 27,622          21,970          21,958            Noninterest expense (75,679)        (125,040)       (110,206)         Net loss from continuing operations, net of taxes (130,421)       (131,518)       (39,978)          Net loss from discontinued operations, net of taxes (1,406)          (5,796)          (27)                 Preferred stock gain and dividends, net (3,294)          44,592          -                    Net loss to common shareholders (135,121)$   (92,722)$     (40,005)$       Weighted average basic and diluted shares outstanding 114,240             4,196,926         21,368,460
 7   Quarterly Operating Highlights       4Q 2012 net loss from continuing   operations of $6.3 million, a $1.6   million increase in net loss from 3Q   2012, and a $24.3 million   improvement in net loss from 4Q   2011    4Q 2012 net loss to common   shareholders of $6.3 million   compared to net losses to common   shareholders of $4.7 million in 3Q   2012 and net income to common   shareholders of $17.1 million in 4Q   2011   ― 4Q 2011 includes $47.8 million   impact of preferred stock gain on   conversion to common equity    Net loss per common share of $0.29   per share  compared to net losses of   $0.22 in 3Q 2012 and net income per   common share of $1.05 in 4Q 2011    All quarters except 4Q 2011 reflect   the full results of Granite      Quarterly Performance Metrics   Dollars in thousands except per share data 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Net loss from continuing operations, net of taxes (30,628)$       (10,832)$       (18,138)$       (4,712)$        (6,296)$          Net income/(loss) to common shareholders 17,090          (10,859)        (18,138)        (4,712)          (6,296)            1.05             (0.51)            (0.86)            (0.22)            (0.29)              Net income/(loss) to common shareholders per share 1.05             (0.51)            (0.86)            (0.22)            (0.29)              Return on average assets 2.99% (1.82%) (3.13%) (0.84%) (1.14%)   Return on average equity 50.24% (34.26%) (60.99%) (17.51%) (24.00%)   Net interest margin 2.63% 2.82% 3.06% 2.95% 2.95%   Core noninterest expense to average assets 1 3.58% 3.08% 3.40% 3.35% 3.21%   1  Non-GAAP measure.  See Appendix for reconciliation to GAAP presentation.   Net income/(loss) from continuing operations to        common shareholders per share   Quarterly Results   Results of Operations   Dollars in thousands, except per share data 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Net interest income 13,417$        15,180$        16,049$        15,202$        14,849$          Provision for loan losses (6,418)          (3,067)          (7,778)          (32)               (3,172)            Noninterest income 4,908           3,826           6,532           4,643           6,957             Noninterest expense (42,646)        (26,848)        (32,915)        (24,602)        (25,841)          Net loss from continuing operations, net of taxes (30,628)        (10,832)        (18,138)        (4,712)          (6,296)            Net loss from discontinued operations, net of taxes (74)               (27)               -                  -                  -                    Preferred stock gain and dividends, net 47,792          -                  -                  -                  -                    Net income/(loss) to common shareholders 17,090$      (10,859)$     (18,138)$     (4,712)$       (6,296)$         Weighted average basic and diluted shares outstanding 16,311,834       21,102,465       21,190,848       21,588,027       21,368,460
 8   Core Earnings       Core earnings is a non-GAAP measure   that excludes taxes, credit costs and   nonrecurring items from our   reported results    2012 core earnings of $4.4 million   was improved from core earnings net   loss of $11.6 million in 2011   ― Margin increase of $21.7 million   ― $4.5 million growth in core   noninterest income   ― $10.2 million increase in core   noninterest expense    Core earnings of $1.8 million in 4Q   2012 was improved from 3Q 2012,   and improved from a core earnings   net loss of $(3.6) million in 4Q 2011       Dollars in thousands except per share data 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Net income/(loss) to common shareholders 17,090$        (10,859)$       (18,138)$       (4,712)$        (6,296)$          Less taxes, credit costs and nonrecurring items:   Preferred stock gain, net 47,792          -                  -                  -                  -                    Gain on extinguishment of debt 1,625           -                  -                  -                  -                    Loss on discontinued operations, net (74)               (27)               -                  -                  -                       Income tax benefit (expense) 111              77                (26)               77                911                Gain/(loss) on fair value swap (326)             -                  -                  -                  -                           Gain on sales of securities (10)               (46)               2,002           (33)               2,198                 Other real estate owned expense (19,966)        (5,519)          (12,473)        (3,602)          (6,289)                 Provision for loan losses (6,418)          (3,067)          (7,778)          (32)               (3,172)            Loss on sale of loans held for sale (1,241)          -                  -                  -                  -                    Prepayment penalty on borrowings (577)             -                  -                  -                  -                    Granite and litigation accruals -                  -                  (1,100)          -                  -                    Loan collection expense (1,161)          (746)             (514)             (1,119)          (895)               Merger-related expense 971              (2,258)          840              (939)             (884)               Core Earnings 1 (3,636)$       727$            911$            936$            1,835$          Quarterly Core Earnings 1   Dollars in thousands except per share data 2010 2011 2012   Net loss to common shareholders (135,121)$     (92,722)$       (40,005)$         Less taxes, credit costs and nonrecurring items:   Preferred stock gain, net -                  44,592          -                    Gain on extinguishment of debt -                  1,625           -                    Loss on discontinued operations, net (1,406)          (5,796)          (27)                    Income tax benefit (expense) (1,259)          (641)             1,039             Gain (loss) on fair value swap 273              (339)             -                           Gain on sales of securities 10,647          7,298           4,121                 Other real estate owned expense (14,532)        (51,424)        (27,883)               Provision for loan losses (132,755)       (67,362)        (14,049)          Mortgage servicing rights impairment (2,995)          -                  -                    Loss of loans held for sale -                  (1,241)          -                    Prepayment penalty on borrowings (959)             (1,605)          -                    Granite Mortgage and litigation accruals -                  -                  (1,100)            Loan collection expense (1,001)          (5,032)          (3,274)            Merger-related expense -                  (1,236)          (3,241)            Core Earnings 1 8,866$        (11,561)$     4,409$          Annual Core Earnings 1
 9   0.0%   1.0%   2.0%   3.0%   4.0%   5.0%   6.0%   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Yield on Loans Yield on Investment Securities   Net Interest Margin    Net interest margin was flat in the   4th quarter at 2.95%, but improved   by 32 bps over the 4Q 2011    Average loans and securities, which   exclude low yielding cash balances,   fell by $18.9 million (1%) in 4Q 2012    Average loan yield was down slightly   by 2 bps to 5.12%    Average loans fell $52.3 million (4%)   during 4Q 2012 on runoff of   purchases residential loan pools,   continued asset resolution and loan   prepayment that exceeded new   origination.      $27.5 million of the net reduction in   period end loan balances was non-   Pass loans    Continued improved deposit mix   resulted in 9 bp decline in cost of   deposits to 67 bps in 4Q 2012, down   from 76 bps in 3Q 2012, and down 42   bps from 4Q 2011      Loan and Securities Yields Net Interest Margin and Cost of Deposits   0.0%   0.5%   1.0%   1.5%   2.0%   2.5%   3.0%   3.5%   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Cost of Interest Bearing Deposits Net Interest Margin   Quarterly Results   Average Balances, Yields and Net Interest Margin   Dollars in thousands 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Average loans (includes loans held for sale) 1,154,424$   1,224,349$   1,287,022$   1,262,229$   1,209,947$        Average yield 5.59% 5.59% 5.40% 5.14% 5.12%   Average loans and securities 1,512,523     1,662,210     1,744,436     1,737,261     1,718,446       Average earning assets 2,028,332     2,170,079     2,115,029     2,055,193     2,000,882          Average yield 3.75% 3.71% 3.89% 3.73% 3.65%   Average interest bearing liabilities 1,910,164     1,999,005     1,926,658     1,858,339     1,811,224          Average rate 1.18% 0.97% 0.91% 0.86% 0.77%      Average cost of deposits 1.09% 0.91% 0.83% 0.76% 0.67%   Net interest margin 2.63% 2.82% 3.06% 2.95% 2.95%   Net interest rate spread 2.56% 2.74% 2.98% 2.87% 2.88%
 10   Quarterly Noninterest Income    Total noninterest income increased   $2.3 million in 4Q 12   ― Nonrecurring securities gains of   $2.2 million during 4Q 2012    Core noninterest income increased   $83 thousand (2%) to $4.8 million   from 3Q 2012, and by $1.1 million   (32%) from 4Q 2011    Continued growth in mortgage loan   originations and sales resulted in   increased income of $286 thousand   during 4Q, a 39% increase   ― Originated $59.4 million of loans   during 4Q, and $168.1 million   during 2012   ― Sold $46.1 million of loans during   4Q to Fannie Mae    Service charges on deposits were   weaker on seasonally lower core   deposit balances and 1 bp decline in   service charge rate to 14.5 bps in 4Q   2012         Quarterly Results   Noninterest Income   Dollars in thousands 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Service charges on deposit accounts 1,897$          1,816$          1,830$          1,778$          1,656$            Mortgage loan income 17                36                287              728              1,014             Cardholder and merchant services income 766              1,141           1,176           1,119           1,143             Trust and investment services 190              202              256              234              344                Bank-owned life insurance 275              306              314              290              285                Other service charges, commissions and fees 216              254              271              252              351                Gain on extinguishment of debt 1,625           -                  -                  -                  -                    Securities gains/(losses), net (10)               (46)               2,002           (33)               2,198             Gain/(loss) on fair value swap (326)             -                  -                  -                  -                    Other income/(loss) 258              117              396              275              (34)                 Total noninterest income 4,908$        3,826$        6,532$        4,643$        6,957$          Less:   Gain on extinguishment of debt 1,625           -                  -                  -                  -                    Securities gains/(losses), net (10)               (46)               2,002           (33)               2,198             Gain/(loss) on fair value swap (326)             -                  -                  -                  -                    Core noninterest income 1 3,619$        3,872$        4,530$        4,676$        4,759$          1  Non-GAAP measure.  Reconciliation included in this table.
 11   Quarterly Noninterest Expense    Noninterest expense rose by $1.2   million (5%) from 3Q 2012   ― OREO expense increase of $2.7   million (75%) on OREO disposition   activity during the quarter, offset   by FDIC, professional services and   other expense declines    Core noninterest expense continued   its third consecutive quarterly   decline in 4Q 2012, by $1.2 million   or 6%   ― Core noninterest expense has    declined $2.9 million, or 14%,   from 4Q 2011    FDIC expense declined $0.4 million   (41%) in 4Q on improved regulatory   classification and lower asset base    Personnel expense was stable at $9.7   million and average FTE declined by   10 in 4Q 2012    Merger-related expenses were flat at   $0.9 million in 4Q.  We expect all   merger expenses will be incurred or   accrued for in the first half of 2013      Quarterly Results   Noninterest Expense   Dollars in thousands 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Personnel expense 8,547$          10,026$        10,581$        9,744$          9,700$            Net occupancy expense 1,450           1,561           1,608           1,716           1,576             Furniture, equipment and data processing expense 1,868           2,072           2,141           2,182           2,326             Professional fees 3,117           1,542           1,250           1,473           1,001             Stationery, printing and supplies 154              141              153              152              191                Advertising and marketing 139              129              125              166              537                Other real estate owned expense 19,966          5,519           12,473          3,602           6,289             Credit/debit card expense 421              410              437              432              438                FDIC insurance 1,807           598              1,225           1,056           620                Loan collection expense 1,161           746              514              1,119           895                Merger-related expense (971)             2,258           (840)             939              884                Prepayment penalty on borrowings 577              -                  -                  -                  -                    Loss on sale of loans held for sale 1,241           -                  -                  -                  -                    Core deposit intangible amortization 301              352              352              352              351                Other expense 2,868           1,494           2,896           1,669           1,033             Total noninterest expense 42,646$      26,848$      32,915$      24,602$      25,841$        Other information:   Other real estate owned expense 19,966$        5,519$          12,473$        3,602$          6,289$            Merger-related expense (971)             2,258           (840)             939              884                Loss on sale of loans held for sale 1,241           -                  -                  -                  -                    Loan collection expense 1,161           746              514              1,119           895                Prepayment penalty on borrowings 577              -                  -                  -                  -                    Granite Mortgage and litigation accruals -                  -                  1,100           -                  -                    Core noninterest expense 1 20,672$      18,325$      19,668$      18,942$      17,773$        FTE Employees 609              627              634              637              627                1  Non-GAAP measure.  Reconciliation included in this table.
 12   23% 20% 16% 15% 11%   18%   20%   21% 22% 26%   49% 51% 54% 54% 53%   10% 10% 9% 9% 9%   0%   10%   20%   30%   40%   50%   60%   70%   80%   90%   100%   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Cash and bank balances Investment securities Loans Other assets   Balance Sheet    Total assets decreased $86.5 million   (4%) during 4Q 2012   ― Cash and interest bearing bank   balances decreased $88.3 million   (27%) on securities purchases and   core deposit strategies   ― Investment securities increased   $72.5 million on investment of cash   balances into securities   ― Net loans decreased $61.4 million   (5%) on residential mortgage pool   runoff, problem asset resolution,   and loan payoff activity that   outpaced new loan origination   ― OREO decreased $17.7 million (22%)     Deposits declined $75.3 million (4%)   ― Improved mix change from time   deposits to lower rate deposit   products continued    Balance sheet excludes reserved   deferred tax assets of $182.4 million,   including $33.8 million relating to the   Bank of Granite      Quarterly Balance Sheet   Dollars in thousands 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Cash and interest bearing bank balances 553,416$      468,549$      363,879$      327,870$      239,610$        Investment securities 431,306        473,916        477,136        492,386        564,850          Loans and loans held for sale, net 1,178,175     1,209,902     1,244,596     1,209,148     1,147,721       Other real estate owned 110,386        104,379        86,400          80,800          63,131            Intangible assets 12,082          12,030          11,678          11,574          11,700            Other assets 123,743        119,170        118,072        116,287        124,553          Total assets 2,409,108$ 2,387,946$ 2,301,761$ 2,238,065$ 2,151,565$   Deposits 2,129,111$   2,120,081$   2,041,770$   1,982,253$   1,906,988$     Borrowings 123,910        123,400        126,507        124,474        123,705          27,072          26,491          25,482          24,465          22,427            Equity 129,015        117,974        108,002        106,873        98,445            Total liabilities and equity 2,409,108$ 2,387,946$ 2,301,761$ 2,238,065$ 2,151,565$   Other liabilities   Quarterly Balance Sheet Asset Composition
 13   11% 12% 13%   13% 13%   16% 17%   17% 18% 19%   3.2%   3.4% 3.6%   3.7% 3.9%   20.3%   20.6% 21.6%   22.7% 23.9%   25.3% 23.9%   23.1%   22.7% 21.9%   5.3% 5.0%   4.7% 3.2%   2.9%   18.5% 17.7% 16.8% 16.3% 15.2%   0%   20%   40%   60%   80%   100%   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Noninterest-bearing demand Interest-bearing demand Savings Money market   Time deposits < $100,000 Brokered Time deposits > $100,000   Deposits       Increased core deposits from 76% at   4Q 2011 to 82% of the total at 4Q   2012    Continued improved deposit mix   profile via management actions    ― Indeterminate term core now   represents 60% of deposits, up   from 58% in the prior quarter   ― Time deposits (including brokered   deposits) as a percentage of total   deposits declined from 42% at 3Q   2012 to 40% at 4Q 2012    Cost of interest bearing deposits fell   to 67 bps in 4Q 2012   ― Cost of all deposits fell to 58 bps   from 66 bps in 3Q 2012    Deposits declined by $75.3 million   (4%), virtually all in CD and brokered   CDs   ― Non-brokered CD deposits fell   $64.9 million and brokered   deposits fell by $7.9 million         Quarterly Deposit Mix    Co   re      N   on   -C   or   e   Quarterly Deposits   Dollars in thousands 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Noninterest-bearing demand 234,673$      256,445$      262,087$      264,370$      251,235$        Interest-bearing demand 349,802        364,512        353,586        358,376        362,406          Savings 68,236          72,446          72,925          73,382          74,436            Money market 431,790        437,738        441,824        450,164        455,734          Brokered 112,066        107,047        96,747          63,455          55,590            Time deposits < $100,000 538,306        506,971        471,366        449,542        417,421          Time deposits > $100,000 394,238        374,922        343,235        322,964        290,166          Total deposits 2,129,111$ 2,120,081$ 2,041,770$ 1,982,253$ 1,906,988$
 14   Capital and Liquidity    Capital ratios at both banks   remain above the level   defined as “well capitalized”   under applicable law    On February 27, 2013 the FDIC   terminated its Order with   Granite   ― Granite’s leverage ratio   and total risk-based capital   ratio exceed the minimums    under law and what the   FDIC required under the   Order    CommunityOne is currently   designated as “adequately   capitalized” by the OCC   because it remains subject to   an Order   ― CommunityOne ‘s leverage    and total risk based capital   ratios are currently below   the levels required in its   Order    The loans to deposits ratio   was stable at 62% in 4Q 2012,   improved from 57% at the end   of 2011      Quarterly Capital and Liquidity Ratios Well Regulatory   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012 Capitalized Orders   FNB United Corp   Leverage 6.74% 6.22% 5.83% 5.68% 5.45% 5.00% N/A   Tier 1 risk based capital 11.78% 10.53% 9.62% 9.60% 9.26% 6.00% N/A   Total risk based capital 13.81% 12.93% 12.19% 12.47% 12.34% 10.00% N/A   Tangible common equity/tangible assets 4.88% 4.46% 4.21% 4.28% 4.05% N/A N/A   Loans/deposits 57% 59% 63% 62% 62% N/A N/A   Cash and investment securities/deposits 46% 44% 41% 41% 42% N/A N/A   CommunityOne Bank   Leverage 7.39% 6.86% 6.47% 6.46% 6.17% 5.00% 9.00%   Tier 1 risk based capital 13.23% 11.78% 10.45% 10.52% 10.13% 6.00% N/A   Total risk based capital 14.52% 13.07% 11.73% 11.79% 11.40% 10.00% 12.00%   Bank of Granite   Leverage 7.19% 7.64% 7.61% 7.88% 8.12% 5.00% 8.00%   Tier 1 risk based capital 12.04% 12.86% 13.37% 14.54% 15.04% 6.00% N/A   Total risk based capital 12.04% 12.92% 13.53% 15.57% 16.30% 10.00% 12.00%
 15   Loan Portfolio    Total loans decreased $38 million   (3%) from year end 2011 and $56   million (5%) in the 4th quarter. $27.5   million of  net 4Q reductions were   non-Pass rated loans    1-4 family residential mortgage loans   portfolio comprised $37 million (66%)   of the 4Q 2012 loan portfolio   contraction . The reduction was   driven by prepayments on our   portfolio of originated mortgages   and prepayments/ amortization of    purchased loan pools    The Bank of Granite portfolio of   loans was added in the 4th quarter   of 2011 and was heavily weighted   toward commercial-purpose   mortgage loans    Real Estate Construction loans fell by   $34 million (37%) from 4Q 2011 to 5%   of our total loans at 4Q 2012, down   from 8% a year ago    Credit costs for 4Q 2012 included net   charge-offs of $4.7 million and OREO   write-downs, net of gains on sale, of   $5.4 million         Quarterly Loan Portfolio Mix   Quarterly Loan Portfolio   Dollars in thousands 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Loans held for sale 4,529$          3,938$          1,324$          8,212$          6,974$            Loans held for investment:   Commercial and agricultural 95,089          85,475          78,367          72,669          79,704            Real estate-construction 92,806          79,122          75,576          61,263          58,414            Real estate-mortgage:   1-4 family residential 453,725        529,300        589,972        590,251        553,538          Commercial 531,383        508,067        493,721        463,173        441,836          Consumer 44,532          43,795          44,187          44,439          43,543            Total Loans held for investment 1,217,535     1,245,759     1,281,823     1,231,795     1,177,035       Total loans 1,222,064$ 1,249,697$ 1,283,147$ 1,240,007$ 1,184,009$   4% 4% 3% 4% 4%   43% 41% 38% 37% 37%   37% 42% 46% 48% 47%   8% 6% 6% 5% 5%   8% 7% 6% 6% 7%   0%   10%   20%   30%   40%   50%   60%   70%   80%   90%   100%   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Consumer CRE, OO and NOO 1-4 family residential   Real estate-construction Commercial and agricultural Loans held for sale
 16   -$200   $0   $200   $400   $600   $800   $1,000   $1,200   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   M   ill   io   ns    o   f   Do   lla   rs   Originated loans Originated loan ALL Granite purchased impaired (PI) loans Granite PI FV Mark and ALL Granite purchased contractual (PC) loans Granite PC FV Mark and ALL   Portfolio and Allowance For Loan Losses    Originated loans (including purchased   mortgage pools) are accounted for   under ASC 310-20   ― ALL established via provision,   losses recognized via charge-offs   ― 4Q 2012 ALL of $23.6 million    Granite purchased contractual (PC)   loans are accounted for under ASC   310-20   ― Subject to ALL as FV mark is   accreted   ― Total ALL and remaining   unaccreted FV mark of $1.6 million   at December 31, 2012    Granite purchased impaired (PI)   loans, are accounted for under ASC   310-30 (SOP-03-3)   ― $11.9 million remaining FV mark at   year end 2012   ― Remaining projected accretion of   $30.3 million at year end 2012   Loan Portfolio and ALL By Origination Type   Quarterly Loan Portfolio, ALL and Fair Value Marks 1   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Originated loans 844,047        894,607        958,075        944,493        913,799          Granite purchased impaired (PI) loans 330,836        310,389        287,092        252,205        228,392          Granite purchased contractual (PC) loans 42,652          40,763          36,656          35,097          34,844                 Total loans 1,217,535$ 1,245,759$ 1,281,823$ 1,231,795$ 1,177,035$   Originated loan ALL (39,360)        (39,747)        (34,756)        (27,282)        (23,633)          Granite PI loan ALL and fair value (FV) mark 1 (28,278)        (18,893)        (16,510)        (12,718)        (11,921)          Granite PC loan ALL and fair value (FV) mark 1 (2,364)          (1,817)          (2,052)          (1,710)          (1,584)                 Pro forma total ALL and FV marks 1 (70,002)$     (60,457)$     (53,318)$     (41,710)$     (37,138)$       Originated loan ALL / Originated loans (4.66%) (4.44%) (3.63%) (2.89%) (2.59%)   Granite PI ALL and FV mark / Granite PI loans 1 (8.55%) (6.09%) (5.75%) (5.04%) (5.22%)   Granite PC ALL and FV mark / Granite PC loans 1 (5.54%) (4.46%) (5.60%) (4.87%) (4.55%)   1  Non-GAAP presentation, see Appendix.  Includes remaining fair value marks on purchased Granite loans
 17   Asset Quality    The allowance has been reduced from   $39.4 million to $29.3 million over the   last year, reflecting an improvement   in asset quality    The  remaining fair value adjustment   on the acquired Granite portfolio fell   by $6 million as a result of accretion   and realization of expected loss   content    The Bank continues a focus on   problem asset resolution with a 2012   year end Special Assets staff of 19.   The staff will be periodically   evaluated to assure appropriate   expense control   ― Classified loans decreased by over    $55 million (27%) since reaching   $207.9 million in 1Q 2012. Special   Mention loans decreased by $58.9   million (45%) since  4Q 2011. $153   million of Classified loans and $72   million of  Special Mention loans   remain   ― Continued reduction of problem   loans balanced with appropriate   rehabilitation efforts  will be our   primary objectives      Quarterly Problem Loan and Asset Trends   $176   $208   $192   $170   $153   $131   $107   $92 $82 $72   $0   $50   $100   $150   $200   $250   $300   $350   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   M   ill   io   ns    o   f   Do   lla   rs   Special Mention Classified   $106 $105   $96 $86 $79   $110 $104   $86   $81   $63   $0   $50   $100   $150   $200   $250   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   M   ill   io   ns    o   f   Do   lla   rs   Nonperforming loans OREO and foreclosed assets   Quarterly Asset Quality 1   Dollars in thousands 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Allowance for loan losses (ALL) 39,360$        39,795$        38,551$        30,859$        29,314$          Remaining fair value (FV) mark on Granite portfolio 30,642          20,662          14,767          10,851          7,824             Nonperforming loans/Total loans 8.7% 8.5% 7.5% 7.0% 6.8%   Nonperforming assets/ Loans plus OREO 16.3% 15.5% 13.3% 12.7% 11.5%   Annualized net charge-offs/Average loans 10.75% 0.87% 2.83% 2.46% 1.94%   Allowance for loan loss/Total loans 3.23% 3.19% 3.01% 2.51% 2.49%   Pro forma ALL and FV mark/Total loans 1 5.75% 4.85% 4.16% 3.39% 3.16%   1  Non-GAAP presentation, see Appendix.  Includes remaining fair value marks on purchased Granite loans
 18   Non-Performing Assets    Nonperforming loans fell by $26.5   million (25%) and $6.7 million (8%)   since 4Q 2011 and 3Q 2012,   respectively     Real estate construction loans remain   the most troubled category and we   have  reduced them by $19.8 million   (58%) and $4.2 million (23%) since 4Q   2011 and 3Q 2012, respectively    OREO dispositions have been   outpacing foreclosure additions.    OREO was reduced by $47.3 million   (43%) since 4Q 2011, including $17.7   million (22%) in the 4th quarter alone    OREO assets are carried at appraised   value less selling costs, and   sometimes adjusted further by   management due to age or other   market criteria    As of December 31, 2012, $22 million   of OREO was under contract for sale   and carried at the net sales price    In the last year, non-performing assets   have been reduced by $73.8 million   (34%)   Nonperforming Loan Composition   Nonperforming Loans and OREO   Dollars in thousands 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Commercial and agricultural 4,941$          4,259$          2,934$          3,147$          2,796$            Real estate - construction 34,051          23,383          24,853          18,506          14,297            Real estate - mortgage:   1-4 family residential 26,857          30,427          22,300          22,131          18,372            Commercial 39,874          46,825          44,817          42,133          43,798            Consumer 250              447              633              226              206                Total nonperforming loans 105,973      105,341      95,537        86,143        79,469          OREO, other foreclosed assets and disc ops assets 110,386        104,379        86,400          80,800          63,131            Total nonperforming assets 216,359$    209,720$    181,937$    166,943$    142,600$      0%   20%   40%   60%   80%   100%   4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   RE - 1-4 Family RE - Commercial   Commercial and agricultural Real estate - construction   Consumer
 19   2013 Goals     Complete the merger         ― Expect to merge Granite into CommunityOne in 2Q 2013   ― Consolidate branch and ATM networks   ― Complete consolidation of operational functions   ― Implement new product set at Granite branches   ― Capture remaining expense synergies   ― Better serve customers throughout footprint      ― Continue to reduce problem asset levels and increase asset quality       Complete credit cleanup       ― Anticipate return to profitability in the second half of 2013   ― Continued improvement in NIM   ― Increase in NII, growth in mortgage loan income   ― Additional reductions in core NIE   ― Continued reduction in credit-related costs       Return to profitability         ― Continue our progress to restore the Company to a satisfactory   condition   ― Improved earnings profile   ― Improved asset quality   ― Enhanced risk management   ― FDIC action to lift Granite Order acknowledges progress to date    Continue Improvements to return to   satisfactory condition
 Appendix
 21   Non-GAAP Measures    Reconciliation of non-   GAAP measures to the   most directly   comparable GAAP   measure    Reconciliations to   GAAP for the non-   GAAP measures core   noninterest expense,   core noninterest   income and core   earnings are   presented in the tables   on pages 8, 10 and 11      Reconciliation of Non-GAAP Measures   Dollars in thousands 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Total shareholders' equity 129,015$    117,974$    108,002$    106,873$    98,445$        Less:   Goodwill (3,905)          (4,205)          (4,205)          (4,205)          (4,205)            Core deposit and other intangibles (8,177)          (7,825)          (7,473)          (7,369)          (7,495)            Tangible shareholders' equity 116,933$    105,944$    96,324$      95,299$      86,745$        4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012   Originated loan ALL (39,360)$       (39,747)$       (34,756)$       (27,282)$       (23,633)$         Purchased contractual (PC) loan ALL -                  (48)               (459)             (281)             (308)               Purchased impaired (PI) loan ALL -                  -                  (3,336)          (3,296)          (5,373)            Total allowance for loan losses (39,360)       (39,795)       (38,551)       (30,859)       (29,314)         Plus:   Fair value (FV) mark on PC loans (2,364)          (1,769)          (1,593)          (1,429)          (1,276)            Fair value (FV) mark on PI loans (28,278)        (18,893)        (13,174)        (9,422)          (6,548)            Pro forma total ALL and FV mark (70,002)$     (60,457)$     (53,318)$     (41,710)$     (37,138)$       Purchased impaired (PI) loan ALL -$                 -$                 (3,336)$        (3,296)$        (5,373)$          Fair value (FV) mark on PI loans (28,278)        (18,893)        (13,174)        (9,422)          (6,548)            Granite PI loan ALL and FV mark (28,278)$     (18,893)$     (16,510)$     (12,718)$     (11,921)$       Purchased contractual (PC) loan ALL -$                 (48)$             (459)$           (281)$           (308)$             Fair value (FV) mark on PC loans (2,364)          (1,769)          (1,593)          (1,429)          (1,276)            Granite PC loan ALL and FV mark (2,364)$       (1,817)$       (2,052)$       (1,710)$       (1,584)$
 22   Non-GAAP Measures    Reconciliation of non-   GAAP measures to the   most directly   comparable GAAP   measure   Reconciliation of Non-GAAP Measures   Noninterest Expense   Dollars in thousands 2010 2011 2012   Personnel expense 25,931$        27,725$        40,051$          Net occupancy expense 4,768           4,933           6,461             Furniture, equipment and data processing expense 6,744           6,648           8,721             Professional fees 3,680           7,335           5,266             Stationery, printing and supplies 491              471              637                Advertising and marketing 1,479           645              957                Other real estate owned expense 14,532          51,424          27,883            Credit/debit card expense 1,715           1,674           1,717             FDIC insurance 5,856           6,706           3,499             Loan collection expense 1,001           5,032           3,274             Merger-related expense -                  1,236           3,241             Mortgage servicing rights impairment 2,995           -                  -                    Prepayment penalty on borrowings 959              1,605           -                    Loss on sale of loans held for sale -                  1,241           -                    Core deposit intangible amortization 795              896              1,407             Other expense 4,733           7,469           7,092             Total noninterest expense 75,679$      125,040$    110,206$      Less:   Other real estate owned expense 14,532$        51,424$        27,883$          Mortgage servicing rights impairment 2,995           -                  -                    Loss on sale of loans held for sale -                  1,241           -                    Loan collection expense 1,001           5,032           3,274             Merger-related expense -                  1,236           3,241             Granite Mortgage and litigation accruals -                  -                  1,100             Prepayment penalty on borrowings 959              1,605           -                    Core noninterest expense 56,192$      64,502$      74,708$