##### Table of Contents





UNITED STATES
    SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C.
    20549
    FORM 10-K
  (Mark One)
  þ
    ANNUAL REPORT PURSUANT TO
    SECTION 13 OR 15(d) OF THE SECURITIES 
    EXCHANGE ACT OF 1934  For the
    fiscal year ended December 31, 2010
  OR
  o
    TRANSITION REPORT PURSUANT TO
    SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934  For the transition period from
    
    to
  Commission file number
    001-34737
  VIEWPOINT FINANCIAL GROUP,
    INC.
 (Exact name of registrant as
    specified in its charter)
  Maryland

27-2176993(State or other jurisdiction of incorporation or
    organization)

(I.R.S. Employer Identification No.)1309 W. 15th

    Street, Plano, Texas

75075(Address of Principal Executive Offices)

(Zip Code)   Registrants telephone number, including area code:
    (972) 578-5000
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, par value $0.01 per share

Nasdaq Global Select Market   Securities registered pursuant to Section 12(g) of the
    Act: None
  o þ
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  Large accelerated filer

o



Accelerated
    filer oNon-accelerated filer

þ

(Do not check if a smaller reporting company)

Smaller reporting
    company o   Rule 12b-2 o þ
      DOCUMENTS INCORPORATED BY
    REFERENCE:
  Document

Part of Form 10-KPortions of the definitive Proxy Statement to 
    be used in conjunction with the Registrants
    Annual Meeting of Shareholders

Part III




---



##### 





VIEWPOINT
    FINANCIAL GROUP, INC.
  FORM 10-K
  December 31,
    2010
  INDEX
   
 PagePART IItem 1


Business


3Item 1A


Risk Factors


35Item 1B


Unresolved Staff Comments


40Item 2


Properties


40Item 3


Legal Proceedings


44Item 4


(Removed and Reserved)


44PART IIItem 5


Market for Registrants Common Equity,
    Related Shareholder Matters and Issuer Purchases of Equity
    Securities


45Item 6


Selected Financial Data


47Item 7


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


49Item 7A


Quantitative and Qualitative Disclosures about
    Market Risk


69Item 8


Financial Statements and Supplementary Data


73Item 9


Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


126Item 9A


Controls and Procedures


126Item 9B


Other Information


127PART IIIItem 10


Directors, Executive Officers and Corporate
    Governance


128Item 11


Executive Compensation


128Item 12


Security Ownership of Certain Beneficial Owners
    and Management and Related Shareholder Matters


128Item 13


Certain Relationships and Related Transactions,
    and Director Independence


128Item 14


Principal Accountant Fees and Services


128PART IVItem 15


Exhibits, Financial Statement Schedules


129Signatures





131EX-21EX-23.1EX-23.2EX-31.1EX-31.2EX-32




---



##### Table of Contents



PART I  Item 1.
    Business  Special
    Note Regarding Forward-Looking Statements
  Form 10-K,
    General
         3




---



##### Table of Contents



Market
    Areas
  Form 10-K
    Dallas-Fort Worth-Arlington,
 4




---



##### Table of Contents





Lending
    Activities
    December 31,2010


2009


2008


2007


2006Amount


Percent


Amount


Percent


Amount


Percent


Amount


Percent


Amount


Percent(Dollars in thousands)Real estate loans:One- to four- family

$
393,896



35.58%


$
421,935



37.62%


$
498,961



39.92%


$
332,780



36.40%


$
282,918



29.21%Commercial


479,071



43.28



453,604



40.44



436,483



34.92



251,915



27.56



179,635



18.55Home equity


115,418



10.43



116,138



10.35



101,021



8.08



85,064



9.31



83,899



8.66Construction


12,004



1.08



7,074



0.63



503



0.04



225



0.02



5,181



0.54Total real estate loans


1,000,389



90.37



998,751



89.04



1,036,968



82.96



669,984



73.29



551,633



56.96Other loans:Consumer loans:Automobile indirect


1,606



0.15



10,711



0.96



38,837



3.11



104,156



11.39



219,147



22.63Automobile direct


40,944



3.70



57,186



5.10



73,033



5.84



98,817



10.81



151,861



15.68Other secured


10,619



0.96



12,217



1.09



14,107



1.13



12,626



1.38



14,678



1.52Lines of credit/unsecured


14,197



1.28



14,781



1.32



15,192



1.21



16,351



1.79



21,284



2.20Total consumer loans


67,366



6.09



94,895



8.47



141,169



11.29



231,950



25.37



406,970



42.03Commercial non-mortgage


39,279



3.54



27,983



2.49



71,8451



5.75



12,278



1.34



9,780



1.01Total loans


1,107,034



100.00%



1,121,629



100.00%



1,249,982



100.00%



914,212



100.00%



968,383



100.00%Less:Deferred fees and discounts


(73)







(1,160)







(1,206)







603







3,576Allowance for loan losses


(14,847)







(12,310)







(9,068)







(6,165)







(6,507)Total loans receivable, net

$
1,092,114






$
1,108,159






$
1,239,708






$
908,650






$
965,452Loans held for sale

$
491,985






$
341,431






$
159,884






$
13,172






$
3,212     (1)
    
    Includes $53.3 million of
    warehouse lines of credit, which are classified as secured
    commercial lines of credit. These lines were originated between
    July 2008 and August 2009. 5




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##### Table of Contents



December 31,2010


2009


2008


2007


2006Amount


Percent


Amount


Percent


Amount


Percent


Amount


Percent


Amount


Percent(Dollars in thousands)Fixed rate loans:Real estate loans:One- to four- family

$
300,007



27.10%


$
304,810



27.18%


$
375,421



30.04%


$
302,193



33.06%


$
247,910



25.60%Commercial


299,849



27.09



284,741



25.39



271,830



21.75



179,826



19.67



140,797



14.54Home equity


80,013



7.23



83,368



7.43



84,124



6.73



70,643



7.73



68,795



7.10Construction


-



-



-



-



-



-



-



-



1,660



0.17Total real estate loans


679,869



61.42



672,919



60.00



731,375



58.52



552,662



60.46



459,162



47.41Other loans:Consumer loans:Automobile indirect


1,606



0.15



10,711



0.96



38,837



3.11



104,156



11.39



219,115



22.63Automobile direct


40,944



3.70



57,186



5.10



73,033



5.84



98,817



10.81



151,816



15.68Other secured


4,346



0.39



4,844



0.43



5,238



0.42



5,454



0.60



7,050



0.73Lines of credit/unsecured


3,333



0.30



3,361



0.30



3,456



0.27



4,168



0.46



7,652



0.79Total consumer loans


50,229



4.54



76,102



6.79



120,564



9.64



212,595



23.26



385,633



39.83Commercial non-mortgage


26,744



2.41



10,901



0.97



10,213



0.82



9,359



1.02



7,979



0.82Total fixed rate loans


756,842



68.37



759,922



67.76



862,152



68.98



774,616



84.74



852,774



88.06Adjustable rate loans:Real estate loans:One- to four- family


93,889



8.48



117,125



10.44



123,540



9.88



30,587



3.34



35,008



3.61Commercial


179,222



16.19



168,863



15.05



164,653



13.17



72,089



7.89



38,838



4.01Home equity


35,405



3.20



32,770



2.92



16,897



1.35



14,421



1.58



15,104



1.56Construction


12,004



1.08



7,074



0.63



503



0.04



225



0.02



3,521



0.37Total real estate loans


320,520



28.95



325,832



29.04



305,593



24.44



117,322



12.83



92,471



9.55Other loans:Consumer loans:Automobile indirect


-



-



-



-



-



-



-



-



32



-Automobile direct


-



-



-



-



-



-



-



-



45



-Other secured


6,273



0.57



7,373



0.66



8,869



0.71



7,172



0.78



7,628



0.79Lines of credit/unsecured


10,864



0.98



11,420



1.02



11,736



0.94



12,183



1.33



13,632



1.41Total consumer loans


17,137



1.55



18,793



1.68



20,605



1.65



19,355



2.11



21,337



2.20Commercial non-mortgage


12,535



1.13



17,082



1.52



61,6321



4.93



2,919



0.32



1,801



0.19Total adjustable rate loans


350,192



31.63



361,707



32.24



387,830



31.02



139,596



15.26



115,609



11.94Total loans


1,107,034



100.00%



1,121,629



100.00%



1,249,982



100.00%



914,212



100.00%



968,383



100.00%Less:Deferred fees and discounts


(73)







(1,160)







(1,206)







603







3,576Allowance for loan losses


(14,847)







(12,310)







(9,068)







(6,165)







(6,507)Total loans receivable, net

$
1,092,114






$
1,108,159






$
1,239,708






$
908,650






$
965,452Loans held for sale

$
491,985






$
341,431






$
159,884






$
13,172






$
3,212     1
    
    Includes $53.3 million of
    warehouse lines of credit, which are classified as secured
    commercial lines of credit. These lines were originated between
    July 2008 and August 2009.


6




---



##### Table of Contents



due-on-sale
  One- to Four- Family andHome Equity


Commercial Real Estate


Construction


Consumer


Commercial Non-Mortgage


TotalWeighted





Weighted





Weighted





Weighted





Weighted





WeightedDue During Years




Average





Average





Average





Average





Average





AverageEnding December 31,

Amount


Rate


Amount


Rate


Amount


Rate


Amount


Rate


Amount


Rate


Amount


Rate(Dollars in thousands)2011(1)

$
2,330



5.56
%

$
52,733



6.54
%

$
11,435



6.28
%

$
19,464



9.34
%

$
10,894



6.55
%

$
96,856



6.88
%2012


2,387



6.53



51,483



6.61



-



-



8,262



7.15



4,441



4.88



66,573



6.562013


4,084



5.80



29,323



6.77



-



-



12,090



6.70



1,069



6.68



46,566



6.662014-2015


9,424



6.21



170,615



6.65



-



-



24,000



6.26



8,142



6.91



212,181



6.602016-2020


52,322



5.62



158,916



6.47



569



6.75



3,112



7.13



14,733



7.69



229,652



6.372021-2025


86,381



5.20



6,315



5.11



-



-



438



8.59



-



-



93,134



5.212026 and following


352,386



5.70



9,686



6.38



-



-



-



-



-



-



362,072



5.72Total

$
509,314






$
479,071






$
12,004






$
67,366






$
39,279






$
1,107,034     (1)
    
    Includes demand loans, loans having
    no stated maturity and overdraft loans.    Lending Authority.
    One- to Four-Family Real Estate Lending.
   7




---



##### Table of Contents



loan-to-value loan-to-value
          loan-to-value
   8




---



##### Table of Contents



Warehouse Purchase Program.
    Commercial Real Estate Lending.
  30-year Loan-to-value loan-to-value loan-to-value loan-to-value
 9




---



##### Table of Contents



loan-to-value
  Property Type

$ Amount


% of Total


LTV(Dollars in Thousands)Office

$
202,350



42.24
%


62.2
%Retail


146,768



30.64



57.0Industrial


34,976



7.30



61.0Office/Warehouse


35,642



7.44



64.5Storage Facility


13,719



2.86



47.1Medical Office


10,809



2.25



53.0Mixed Use


8,814



1.84



29.9Hotel


7,381



1.54



66.3Mobile Home Park


5,829



1.22



50.0Multifamily


3,864



0.81



61.9Church


3,669



0.76



41.0Land


143



0.03



60.2Other


5,107



1.07



49.6$
479,071



100.00
%


58.2
%     and/or
    Home Equity Lending. loan-to-value loan-to-value loan-to-value
 10




---



##### Table of Contents



Consumer Lending.
  Loan-to-value
  debt-to-income
      Commercial Non-Mortgage Lending.
     11




---



##### Table of Contents



Loan
    Originations, Purchases, Sales, Repayments and
    Servicing
          and/or
     12




---



##### Table of Contents



Year Ended December 31,2010


2009


2008(Dollars in thousands)Originations by type:Adjustable rate loans:Real estate loans:One- to four- family

$
23,008


$
37,998


$
109,124Construction


14,427



10,664



3,753Commercial


24,889



7,134



106,756Home equity


5,742



11,095



8,939Total real estate loans


68,066



66,891



228,572Other loans:Consumer:Automobile indirect


-



-



-Automobile direct


-



-



-Other secured


1,951



3,778



1,278Lines of credit/unsecured


594



617



1,155Total consumer loans


2,545



4,395



2,433Commercial non-mortgage


6,272



38,682
(1)


105,905
(1)Total adjustable rate loans


76,883



109,968



336,910Fixed rate loans:Real estate loans:One- to four- family


457,490



647,014



393,927Construction


1,152



-



-Commercial


69,994



61,019



159,303Home equity


20,872



12,394



34,599Total real estate loans


549,508



720,427



587,829Other loans:Consumer:Automobile indirect


-



-



-Automobile direct


16,534



25,626



31,643Other secured


1,503



2,680



2,882Lines of credit/unsecured


2,542



2,556



2,881Total consumer loans


20,579



30,862



37,406Commercial non-mortgage


19,107



4,853



8,692Total fixed rate loans


589,194



756,142



633,927Total loans originated


666,077



866,110



970,837Purchases:Real estate loans:One- to four- family


7,785,854
(2)


5,242,511
(2)


296,572
(2)Commercial


-



-



3,376Total loans purchased


7,785,854



5,242,511



299,948Sales and Repayments:Real estate loans:One- to four- family


7,726,951
(2)


5,561,052
(2)


444,506
(2)Commercial


7,452



29,322



30,200Other loans:Consumer


1,344



3,418



813Total loans sold


7,735,747



5,593,792



475,519Principal repayments


580,225



461,635



312,784Total reductions


8,315,972



6,055,427



788,303Increase (decrease) in other items, net


(1,450
)


(3,196
)


(4,712
)Net increase (decrease)

$
134,509


$
49,998


$
477,770     (1)
    
    Includes $22.0 million and
    $93.4 million of warehouse lines of credit originated from
    July 2008 to August 2009, respectively, which are classified as
    secured commercial lines of credit.(2)
    
    Includes Warehouse Purchase Program
    loans. 13




---



##### Table of Contents



Asset
    Quality
            and/or
     14




---



##### Table of Contents



Delinquent Loans.
  Loans Delinquent For:30-89 Days


90 Days and Over


Total Loans Delinquent 30 Days or MorePercent ofLoan








Percent of Loan








Percent of LoanNumber


Amount


Category


Number


Amount


Category


Number


Amount


Category(Dollars in thousands)Real estate loans:One- to four- family


59


$
6,543



1.66
%


30


$
4,092



1.04
%


89


$
10,635



2.70
%Commercial


1



2,869



0.60



2



1,645



0.34



3



4,514



0.94Home equity


26



957



0.83



6



907



0.79



32



1,864



1.62Total real estate loans


86



10,369



1.04



38



6,644



0.66



124



17,013



1.70Other loans:Consumer loans:Automobile indirect


17



59



3.67



12



78



4.86



29



137



8.53Automobile direct


28



208



0.51



8



64



0.16



36



272



0.67Other secured


1



32



0.30



1



2



0.02



2



34



0.32Lines of credit/unsecured


27



131



0.92



16



108



0.76



43



239



1.68Total consumer loans


73



430



0.64



37



252



0.37



110



682



1.01Commercial non-mortgage


6



174



0.44



1



52



0.13



7



226



0.57Total loans


165


$
10,973



0.99
%


76


$
6,948



0.63
%


241


$
17,921



1.62
%   15




---



##### Table of Contents



Non-performing Assets. and/or ASC 310-40,
  Year Ended December 31,2010


2009


2008


2007


2006(Dollars in thousands)Nonaccruing loans:One- to four- family real estate

$
5,938


$
6,151


$
1,423


$
689


$
-Commercial real estate


9,812



4,682



-



989



-Home equity


1,306



418



173



22



72Automobile indirect


84



124



190



185



207Automobile direct


95



136



124



86



145Consumer other secured


13



4



5



1



-Consumer lines of credit/unsecured


108



116



128



63



177Commercial non-mortgage


272



44



174



67



703Total


17,628



11,675



2,217



2,102



1,304Accruing loans more than 90 days delinquent:Automobile direct


-



-



-



-



30Total non-performing loans


17,628



11,675



2,217



2,102



1,334Foreclosed assets:One- to four- family real estate


449



462



718



615



460Commercial real estate


2,219



3,455



843



-



-Automobile indirect


-



-



56



212



146Automobile direct


-



-



24



13



45Other consumer


11



-



3



-



-Commercial non-mortgage


-



-



-



-



4Total


2,679



3,917



1,644



840



655Total non-performing assets

$
20,307


$
15,592


$
3,861


$
2,942


$
1,989Total non-performing assets as a percentage of total assets


0.69
%


0.66
%


0.17
%


0.18
%


0.13
%Total non-performing loans as a percentage of total loans


1.59
%


1.04
%


0.18
%


0.23
%


0.14
%Performing troubled debt restructurings:One- to four- family real estate


143



343



93



-



-Commercial real estate


1,119



-



1,796



-



-Home equity


-



113



67



-



-Automobile indirect


4



162



231



607



592Automobile direct


22



185



209



759



1,365Consumer other secured


-



-



-



5



4Consumer lines of credit/unsecured


-



96



132



40



76Commercial non-mortgage


-



79



-



-



-Total

$
1,288


$
978


$
2,528


$
1,411


$
2,037      16




---



##### Table of Contents



Other Loans of Concern.
  Classified Assets.
    At December 31,2010


2009(Dollars in thousands)Loss

$
-


$
-Doubtful


4,185



4,153Substandard


17,410



12,049Total

$
21,595


$
16,202     Allowance for Loan Losses.
   17




---



##### Table of Contents



and/or
     18




---



##### Table of Contents



Year Ended December 31,2010


2009


2008


2007


2006(Dollars in thousands)Balance at beginning of period

$
12,310


$
9,068


$
6,165


$
6,507


$
7,697Charge-offs:Real estate loans:One- to four- family


320



460



164



120



83Commercial


624



835



180



-



-Home equity


82



54



41



32



62Total real estate loans


1,026



1,349



385



152



145Other loans:Consumer loans:Automobile indirect


150



917



1,493



2,251



2,670Automobile direct


240



530



424



620



518Other secured


1



23



39



31



21Lines of credit/unsecured


939



1,456



1,232



1,862



1,510Total consumer loans


1,330



2,926



3,188



4,764



4,719Commercial non-mortgage


638



720



453



164



102Total charge-offs


2,994



4,995



4,026



5,080



4,966Recoveries:Real estate loans:One- to four- family


17



32



13



14



29Commercial


-



-



-



-



-Home equity


2



-



4



13



39Total real estate loans


19



32



17



27



68Other loans:Consumer loans:Automobile indirect


70



219



305



700



744Automobile direct


77



106



142



305



230Other secured


1



1



23



14



8Lines of credit/unsecured


178



190



249



376



156Total consumer loans


326



516



719



1,395



1,138Commercial non-mortgage


67



37



22



48



5Total recoveries


412



585



758



1,470



1,211Net charge-offs


2,582



4,410



3,268



3,610



3,755Provision for loan losses


5,119



7,652



6,171



3,268



2,565Balance at end of period

$
14,847


$
12,310


$
9,068


$
6,165


$
6,507Ratio of net charge-offs during the period to average loans
    outstanding during the period


0.17%



0.31%



0.30%



0.39%



0.37%Ratio of net charge-offs during the period to average non-
    performing assets


14.38%



45.34%



96.08%



146.41%



147.25%Allowance as a percentage of non-performing loans


84.22%



105.44%



409.02%



293.29%



487.78%Allowance as a percentage of total loans (end of period)


1.34%



1.10%



0.73%



0.67%



0.67%  19




---



##### Table of Contents



December 31,2010


2009


2008


2007


2006Percent of





Percent of





Percent of





Percent of





Percent ofLoans in





Loans in





Loans in





Loans in





Loans inEach





Each





Each





Each





EachCategory to





Category to





Category to





Category to





Category toAmount


Total Loans


Amount


Total Loans


Amount


Total Loans


Amount


Total Loans


Amount


Total Loans(Dollars in thousands)Real estate loans:One- to four- family

$
3,467



36.61
%

$
2,553



38.17
%

$
1,675



39.96
%

$
1,201



36.40
%

$
449



29.33
%Commercial


7,949



43.33



6,457



40.52



4,175



34.92



2,597



27.58



2,025



18.97Home equity


776



10.43



556



10.35



460



8.08



170



9.31



182



8.66Consumer loans:Automobile indirect


44



0.15



262



0.96



503



3.11



946



11.39



2,232



22.63Automobile direct


263



3.70



374



5.10



262



5.84



278



10.81



526



15.68Other secured


39



0.96



25



1.09



15



1.13



13



1.38



9



1.52Lines of credit/unsecured


657



1.28



701



1.32



639



1.21



626



1.79



694



2.20Commercial non-mortgage


1,652



3.54



1,382



2.49



1,339



5.75



334



1.34



390



1.01Total

$
14,847



100.00
%

$
12,310



100.00
%

$
9,068



100.00
%

$
6,165



100.00
%

$
6,507



100.00
%   20




---



##### Table of Contents



Investment
    Activities
       21




---



##### Table of Contents



December 31,2010


2009


2008Amortized





Amortized





AmortizedCost


Fair Value


Cost


Fair Value


Cost


Fair Value(Dollars in thousands)Available for sale:US Government and agency bonds

$
-


$
-


$
47,994


$
47,438


$
18,502


$
18,740SBA Pools


5,084



5,108



6,565



6,492



8,313



8,100Collateralized debt obligations


-



-



-



-



7,940



7,940Agency collateralized mortgage obligations


357,340



357,892



226,242



228,501



313,391



310,065Agency mortgage-backed securities


351,385



354,497



197,437



201,627



137,338



138,171Total available for sale


713,809



717,497



478,238



484,058



485,484



483,016Held to maturity:US Government and agency bonds


9,997



10,165



14,991



15,131



9,992



10,143Municipal bonds


50,488



50,085



29,306



29,900



9,384



9,642Agency collateralized mortgage obligations


209,193



206,280



56,414



57,390



12,304



12,696Agency mortgage-backed securities


162,841



167,766



154,013



158,393



140,663



144,098Total held to maturity


432,519



434,296



254,724



260,814



172,343



176,579Total investment securities


1,146,328



1,151,793



732,962



744,872



657,827



659,595FHLB stock


20,569



20,569



14,147



14,147



18,069



18,069Total securities

$
1,166,897


$
1,172,362


$
747,109


$
759,019


$
675,896


$
677,664  22




---



##### Table of Contents



1 year or less


Over 1 to 5 years


Over 5 to 10 years


Over 10 years


Total SecuritiesWeighted





Weighted





Weighted





Weighted





WeightedAmortized


Average


Amortized


Average


Amortized


Average


Amortized


Average


Amortized


AverageCost


Yield


Cost


Yield


Cost


Yield


Cost


Yield


Cost


Yield


Fair Value(Dollars in thousands)Available for sale:US Government and agency bonds

$
-



-
%

$
-



-
%

$
-



-
%

$
-



-
%

$
-



-
%

$
-SBA pools


-



-



-



-



5,084



2.37



-



-



5,084



2.37



5,108Agency collateralized mortgage obligations


-



-



-



-



13,892



5.22



343,448



2.42



357,340



2.53



357,892Agency mortgage-backed securities


4,218



5.27



-



-



11,671



4.02



335,496



2.58



351,385



2.66



354,497Total available for sale


4,218



5.27



-



-



30,647



4.29



678,944



2.50



713,809



2.59



717,497Held to maturity:US Government and agency bonds


-



-



9,997



3.17



-



-



-



-



9,997



3.17



10,165Municipal bonds


-



-



1,653



3.53



9,586



3.68



39,249



3.77



50,488



3.75



50,085Agency collateralized mortgage obligations


-



-



-



-



39,340



3.76



169,853



2.02



209,193



2.35



206,280Agency mortgage-backed securities


-



-



-



-



60,244



3.50



102,597



3.81



162,841



3.70



167,766Total held to maturity


-



-



11,650



3.22



109,170



3.61



311,699



2.83



432,519



3.04



434,296Total investment securities

$
4,218



-
%

$
11,650



3.22
%

$
139,817



3.76
%

$
990,643



2.60
%

$
1,146,328



2.76
%

$
1,151,793   23




---



##### Table of Contents



Sources
    of Funds
  General.
  Deposits. ®
      Year Ended December 31,2010


2009


2008(Dollars in thousands)Opening balance

$
1,796,665


$
1,548,090


$
1,297,593Net deposits and withdrawals


189,870



214,209



214,968Interest


31,015



34,366



35,529Ending balance

$
2,017,550


$
1,796,665


$
1,548,090Net increase

$
220,885


$
248,575


$
250,497Percent increase


12.29%



16.06%



19.30%  24




---



##### Table of Contents



December 31,2010


2009


2008Percent of





Percent of





Percent ofAmount


Total


Amount


Total


Amount


Total(Dollars in thousands)Transaction and Savings Deposits:Non-interest bearing demand

$
201,998



10.01%


$
193,581



10.77%


$
172,395



11.13%Interest bearing demand


438,719



21.74



268,063



14.92



98,884



6.39Savings


148,399



7.36



143,506



7.99



144,530



9.34Money market


554,261



27.47



549,619



30.59



482,525



31.17IRA


9,251



0.46



8,710



0.49



8,188



0.53Total non-certificates


1,352,628



67.04



1,163,479



64.76



906,522



58.56Certificates:0.00-1.99


407,564



20.20



343,476



19.12



11,078



0.712.00-3.99


201,291



9.98



208,042



11.58



411,501



26.584.00-5.99


56,067



2.78



81,438



4.53



218,989



14.156.00 and over


-



-



230



0.01



-



-Total certificates


664,922



32.96



633,186



35.24



641,568



41.44Total deposits

$
2,017,550



100.00%


$
1,796,665



100.00%


$
1,548,090



100.00%  25




---



##### Table of Contents



0.00-1.99%


2.00-3.99%


4.00-5.99%


Total


Percent of Total(Dollars in thousands)Certificates maturing in quarter ending:March 31, 2011


48,853



10,286



1,267



60,406



9.09
%June 30, 2011


106,830



26,972



2,267



136,069



20.46September 30, 2011


112,556



12,745



1,738



127,039



19.11December 31, 2011


66,491



88,534



2,389



157,414



23.67March 31, 2012


11,951



40,368



983



53,302



8.02June 30, 2012


31,198



4,123



4,104



39,425



5.93September 30, 2012


9,699



1,205



1,597



12,501



1.88December 31, 2012


5,368



1,201



897



7,466



1.12Thereafter


14,618



15,857



40,825



71,300



10.72Total

$
407,564


$
201,291


$
56,067


$
664,922



100.00
%Percent of Total


61.30
%


30.27
%


8.43
%


100.00
%     Maturity3 Months





Over 6 toor less


Over 3 to 6 Months


12 Months


Over 12 Months


Total(Dollars in thousands)Certificates less than $100,000

$
20,991


$
22,020


$
30,025


$
45,194


$
118,230Certificates of $100,000 or more


12,916



23,846



60,925



55,664



153,351Public
    funds(1)


26,499



90,203



193,503



83,136



393,341Total certificates

$
60,406


$
136,069


$
284,453


$
183,994


$
664,922     (1)
    
    Deposits from governmental and
    other public entities.  26




---



##### Table of Contents



Borrowings.
        Year Ended December 31,2010


2009


2008(Dollars in thousands)Maximum balance:FHLB advances

$
513,231


$
424,872


$
410,841Repurchase agreement


25,000



25,000



25,000Other borrowings


10,323



10,000



-Average balance outstanding:FHLB advances

$
364,720


$
346,274


$
242,399Repurchase agreement


25,000



25,000



18,056Other borrowings


10,027



2,083



-  27




---



##### Table of Contents



At December 31,2010


2009


2008(Dollars in thousands)FHLB advances at end of period

$
461,219


$
312,504


$
410,841Repurchase agreement at end of period


25,000



25,000



25,000Other borrowings at end of period


10,000



10,000



-Weighted average rate of FHLB advances during the period


3.21%



4.06%



4.27%Weighted average rate of FHLB advances at end of period


1.95%



4.13%



3.80%Weighted average rate of repurchase agreement during the period


3.22%



2.83%



1.62%Weighted average rate of repurchase agreement at end of period


3.22%



3.22%



1.62%Weighted average rate of other borrowings during the period


5.99%



6.00%



-Weighted average rate of other borrowings at end of period


6.00%



6.00%



-   How We
    Are Regulated
  General.
    ViewPoint
    Bank
    cease-and-desist
 28




---



##### Table of Contents



loans-to-one-borrower loans-to-one-borrower
      FDIC
    Regulation and Insurance of Accounts.
         29




---



##### Table of Contents



Transactions with Affiliates.
  ViewPoint Financial Group, Inc.
  Capital Requirements for ViewPoint Bank.
       30




---



##### Table of Contents



Capital Requirements for ViewPoint Financial Group,
    Inc.
  Community Reinvestment and Consumer Protection
    Laws. Truth-in-Lending
    Bank Secrecy Act / Anti-Money Laundering
    Laws.
 31




---



##### Table of Contents



Limitations on Dividends and Other Capital
    Distributions. year-to-date
    Federal Securities Law.
      Taxation
  Federal
    Taxation
  General.
  Method of Accounting.
  Minimum Tax.
  Net Operating Loss Carryovers.
 32




---



##### Table of Contents



Corporate Dividends-Received Deduction.
  State
    Taxation
    Subsidiary
    and Other Activities
        Competition
    Executive
    Officers of ViewPoint Financial Group, Inc. and ViewPoint
    Bank
    Garold (Gary) R. Base.
 33




---



##### Table of Contents



Mark E. Hord.
  Pathie (Patti) E. McKee.
  Jim Parks.
  Mark L. Williamson.
  Employees
    Internet
    Website
  viewpointbank.com, viewpointfinancialgroup.com viewpointmortgage.com Form 10-K. Form 10-K, Form 10-Q Form 8-K,
 34




---



##### Table of Contents



Item 1A.
    Risk
    Factors    The United States economy remains weak and unemployment
    levels are high. A prolonged economic downturn, especially one
    affecting our geographic market area, will adversely affect our
    business and financial results.
      If economic conditions deteriorate in the State of Texas, our
    results of operations and financial condition could be adversely
    impacted as borrowers ability to repay loans declines and
    the value of the collateral securing loans decreases.
    Our loan portfolio possesses increased risk due to our
    percentage of commercial real estate and commercial non-mortgage
    loans.
   35




---



##### Table of Contents



Our consumer loan portfolio possesses increased risk.
    Our business may be adversely affected by credit risk
    associated with residential property.
    We are subject to credit risks in connection with the
    concentration of adjustable rate loans in our portfolio.
    If our non-performing assets increase, our earnings will
    suffer.
   36




---



##### Table of Contents



If our allowance for loan losses is not sufficient to cover
    actual loan losses, our earnings could decrease.
        Changes in laws and regulations and the cost of regulatory
    compliance with new laws and regulations may adversely affect
    our operations and our income.
     37




---



##### Table of Contents



Changes in interest rates could adversely affect our results
    of operations and financial condition.
      available-for-sale
  Form 10-K.
     38




---



##### Table of Contents



Our strategies to modify our interest rate risk profile may
    be difficult to implement.
  and/or
    and/or
  Liquidity risk could impair our ability to fund operations
    and jeopardize our financial condition.
      Our securities portfolio may be negatively impacted by
    fluctuations in market value and interest rates, which may have
    an adverse effect on our financial condition.
  and/or other-than-temporary available-for-sale
 39




---



##### Table of Contents



available-for-sale available-for-sale
  Higher FDIC insurance premiums and special assessments will
    affect our earnings.
    Strong competition within our market area may limit our
    growth and profitability.
    System failure or breaches of our network security could
    subject us to increased operating costs as well as litigation
    and other liabilities.
    Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties     40




---



##### Table of Contents



LeaseSquare





Expiration


Net Book Value atLocation

Footage


Owned or Leased


Date


12/31/10(Dollars in thousands)ADMINISTRATIVE OFFICES:Contact Center


31,762



Owned



N/A


$
2,4562101 Custer RoadPlano, TX 75075Pitman East


54,409



Owned



N/A



3,8751201 West 15th StreetPlano, TX 75075Pitman West (Main Office)


53,022



Owned



N/A



1,4591309 West 15th StreetPlano, TX 75075ViewPoint Mortgage Operations Office


N/A



Owned



N/A



N/A(located inside Richardson Bank Office)720 E. Arapaho RoadRichardson, TX 75081Richardson Annex


3,800



Owned



N/A



42700 East Arapaho RoadRichardson, TX 75081Warehouse Purchase Program office


884



Leased



1/31/20111



N/A13984 West Bowles Avenue, Suite 100Littleton, CO 80127BANK OFFICES:Addison


6,730



Leased



4/30/2013



N/A4560 Beltline Road, Suite 100Addison, TX 75001Allen


4,500



Owned



N/A



355321 East McDermott DriveAllen, TX 75002Carrollton


6,800



Owned



N/A



1,0601801 Keller Springs RoadCarrollton, TX 75006Coppell


5,674



Owned



N/A



1,478687 North Denton Tap RoadCoppell, TX 75019East Plano


5,900



Owned



N/A



1,1322501 East Plano ParkwayPlano, TX 75074Frisco


4,800



Owned



N/A



9293833 Preston RoadFrisco, TX 75034 41




---



##### Table of Contents



LeaseSquare





Expiration


Net Book Value atLocation

Footage


Owned or Leased


Date


12/31/10(Dollars in thousands)Garland


4,800



Owned



N/A


$
7662218 North Jupiter RoadGarland, TX 75046Grand Prairie Albertsons (in-store location)


452



Leased



8/8/2012



N/A215 North Carrier ParkwayGrand Prairie, TX 75050Grapevine


3,708



Leased



12/31/2028



N/A301 South Park BoulevardGrapevine, TX 76051Lake Highlands Albertsons (in-store location)


391



Leased



11/14/2011



N/A10203 East Northwest HighwayDallas, TX 75238McKinney


4,500



Owned



N/A



6242500 West Virginia ParkwayMcKinney, TX 75071McKinney Mini


1,800



Owned



N/A



78231 North Chestnut StreetMcKinney, TX 75069Northeast Tarrant County


4,338



Owned with Ground Lease



6/30/2018



1,5813040 State Highway 121Euless, TX 76039Oak Cliff


2,800



Leased



9/30/2013



N/A2498 West Illinois AvenueDallas, TX 75233Plano Central


1,681



Owned



N/A



758(Located inside Pitman East admin. office)1201 West 15th StreetPlano, TX 75075Richardson


22,000



Owned



N/A



633720 East Arapaho RoadRichardson, TX 75081Richardson Mini


2,500



Owned



N/A



831775 North Plano RoadRichardson, TX 75081Tollroad Express


2,000



Owned



N/A



5015900 West Park BoulevardPlano, TX 75093West Allen


4,800



Owned



N/A



736225 South Custer RoadAllen, TX 75013West Frisco


4,338



Owned



N/A



1,7522975 Main StreetFrisco, TX 75034 42




---



##### Table of Contents



LeaseSquare





Expiration


Net Book Value atLocation

Footage


Owned or Leased


Date


12/31/10(Dollars in thousands)West Plano


22,800



Owned



N/A


$
1,7425400 Independence ParkwayPlano, TX 75075West Richardson


4,500



Owned



N/A



5351280 West Campbell RoadRichardson, TX 75080Wylie


4,338



Owned



N/A



1,7623490 FM 544Wylie, TX 75098VIEWPOINT MORTGAGE LOAN PRODUCTION OFFICES:Arlington LPO


1,074



Leased



8/31/2011



N/A2340 West Interstate 20 Suites 210 and 212Arlington, TX 76017Austin LPO


2,331



Leased



8/31/2013



N/A11130 Jollyville Road Suite 302Austin, TX 78759Clear Lake/Nassau Bay LPO


2,419



Leased



8/31/2013



N/A1120 NASA Parkway Suites 308 and 320Houston, TX 77058Coppell LPO


2,540



Leased



8/31/2012



N/A275 South Denton Tap Road Suite 100Coppell, TX 75019Dallas LPO
    2


7,670



Leased



MTM*



N/A13101 Preston Road Suite 100Dallas, TX 75240Park Cities LPO


4,654



Leased



4/30/2011



N/A5944 Luther Lane Suite 1000Dallas, TX 75225Plano LPO(Located inside Pitman East admin. office)


N/A



Owned



N/A



N/A1309 West 15th StreetPlano, TX 75075San Antonio LPO


3,212



Leased



11/30/2012



N/A6800 Park Ten Boulevard Suite 194WSan Antonio, TX 78213Sonterra LPO


2,136



Leased



MTM*



N/A325 Sonterra Boulevard East Suite 220San Antonio, TX 78258Southlake LPO


2,400



Leased



3/31/2014



N/A751 East Southlake Boulevard Suite 120Southlake, TX 76092 43




---



##### Table of Contents



LeaseSquare





Expiration


Net Book Value atLocation

Footage


Owned or Leased


Date


12/31/10(Dollars in thousands)Tulsa LPO


1,000



Leased



3/31/2013



N/A1107 North KalanchoeBroken Arrow, OK 74012Waxahachie LPO


1,273



Leased



5/31/2011



N/A102 Professional Place Suite 101Waxahachie, TX 75165Weatherford LPO


1,422



Leased



6/30/2013



N/A300 South Main Street Suite 204Weatherford, TX 76086COMMERCIAL REAL ESTATE LOAN PRODUCTION OFFICE:Houston LPO


400



Leased



MTM*(3
)


N/A7500 San Felipe Road Suite 600Houston, TX 77063     *
    
    Month-to-month1
    
    New lease signed on
    February 1, 2011 expires on January 31, 20122
    
    Office relocated to 5151 Beltline
    Road Suite 725, Dallas, TX 75254 on January 18, 20113
    
    New lease signed on
    January 31, 2011 expires on December 31, 2011      Item 3.
    Legal
    Proceedings    Item 4.
    (Removed
    and Reserved). 44




---



##### Table of Contents



PART II  Item 5.
    Market
    for Registrants Common Equity, Related Shareholder Matters
    and Issuer Purchases of Equity Securities      Market Price Range


DividendsHigh


Low


Declared2010Quarter ended March 31, 2010

$
11.70


$
9.73


$
0.04Quarter ended June 30, 2010


12.69



9.89



0.04Quarter ended September 30, 2010


9.65



8.88



0.04Quarter ended December 31, 2010


11.71



9.16



0.042009Quarter ended March 31, 2009

$
11.21


$
7.55


$
0.06Quarter ended June 30, 2009


11.45



9.25



0.04Quarter ended September 30, 2009


10.53



8.91



0.04Quarter ended December 31, 2009


10.29



9.24



0.04       Equity
    Compensation Plans
    WeightedAverage


Number of SecuritiesNumber of Securities to be Issued upon


Exercise


Remaining Available forExercise of Outstanding Options


Price


Issuance under Plan2007 Equity Incentive Plan


457,555


$
12.01



1,240,033(1
)     (1)
    
    Includes 72,898 shares under
    the plan that may be awarded as restricted stock. 45




---



##### Table of Contents



Shareholder
    Return Performance Graph Presentation
    COMPARISON OF CUMULATIVE TOTAL RETURN
  
  Period EndingCompany/Market/Peer Group


10/3/2006



12/31/2006



12/31/2007



12/31/2008



12/31/2009



12/31/2010ViewPoint Financial Group, Inc.


$
100.00



$
113.01



$
111.20



$
109.06



$
99.08



$
113.98NASDAQ Composite Index


$
100.00



$
107.84



$
119.21



$
71.49



$
103.89



$
122.61Morningstar Group Index


$
100.00



$
119.10



$
101.09



$
94.56



$
85.41



$
74.54Hemscott Group Index


$
100.00



$
106.88



$
62.63



$
44.18



$
36.87



$
29.12  46




---



##### Table of Contents



Item 6.
    Selected
    Financial Data    At and for The Year Ended December 31,2010


2009


2008


2007


2006(Dollars in thousands)Selected Financial Condition Data:Total assets

$
2,941,995


$
2,379,504


$
2,213,415


$
1,658,204


$
1,529,760Loans held for sale


491,985



341,431



159,884



13,172



3,212Loans receivable, net


1,092,114



1,108,159



1,239,708



908,650



965,452Securities available for sale, at fair value


717,497



484,058



483,016



542,875



324,523Securities held to maturity, at amortized cost


432,519



254,724



172,343



20,091



11,271FHLB stock


20,569



14,147



18,069



6,241



3,724Bank-owned life insurance


28,501



28,117



27,578



26,497



-Deposits


2,017,550



1,796,665



1,548,090



1,297,593



1,234,881Borrowings


496,219



347,504



435,841



128,451



55,762Shareholders equity


396,589



205,682



194,139



203,794



214,778Selected Operations Data:Total interest income

$
115,385


$
107,906


$
96,795


$
84,232


$
72,726Total interest expense


44,153



49,286



46,169



41,121



31,386Net interest income


71,232



58,620



50,626



43,111



41,340Provision for loan losses


5,119



7,652



6,171



3,268



2,565Net interest income after provision for loan losses


66,113



50,968



44,455



39,843



38,775Service charges and fees


18,505



18,954



19,779



22,389



20,589Net gain on sale of loans


13,041



16,591



9,390



1,298



199Gain on redemption of Visa, Inc. shares


-



-



771



-



-Impairment of collateralized debt obligations


-



(12,246
)


(13,809
)


-



-Gain on sale of available for sale securities


-



2,377



-



-



-Other non-interest income


1,918



1,523



2,733



2,238



2,646Total non-interest income


33,464



27,199



18,864



25,925



23,434Total non-interest expense


73,146



74,537



68,911



57,957



56,080Income (loss) before income tax expense (benefit)


26,431



3,630



(5,592
)


7,811



6,129Income tax expense
    (benefit)(1)


8,632



960



(2,277
)


2,744



(3,557
)Net income
    (loss)(1)

$
17,799


$
2,670


$
(3,315
)

$
5,067


$
9,686     (1)
    
    Until its conversion to a federally
    chartered savings bank on January 1, 2006, the Bank was a
    credit union, generally exempt from federal and state income
    taxes. As a result of the change in tax status on
    January 1, 2006, the Bank recorded a deferred tax asset in
    the amount of $6.6 million, as well as a related tax
    benefit in the income statement of $6.1 million.  47




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##### Table of Contents



At and for the Year Ended December 31,2010


2009





2008


2007


2006Selected Financial Ratios and Other Data (Unaudited):Performance Ratios:Return on assets (ratio of net income (loss) to average total
    assets)


0.66%



0.12%







-0.17%



0.32%



0.65%Return on equity (ratio of net income (loss) to average equity)


5.69%



1.34%







-1.65%



2.40%



6.76%Interest rate spread:Average during period


2.49%



2.37%







2.28%



2.14%



2.41%End of period


2.20%



2.29%







2.09%



2.14%



2.19%Net interest margin


2.80%



2.72%







2.85%



2.92%



3.00%Non-interest income to operating revenue


22.48%



20.13%







16.31%



23.53%



24.37%Operating expense to average total assets


2.71%



3.26%







3.63%



3.62%



3.79%Efficiency
    ratio(1)


69.87%



76.01%







82.73%



83.95%



86.58%Average interest earning assets to average interest bearing
    liabilities


118.11%



115.14%







121.73%



127.92%



125.57%Dividend payout ratio


21.70%



92.58%







N/M*



41.74%



N/AAsset Quality Ratios:Non-performing assets to total assets at end of period


0.69%



0.66%







0.17%



0.18%



0.13%Non-performing loans to total loans


1.59%



1.04%







0.18%



0.23%



0.14%Allowance for loan losses to non-performing loans


84.22%



105.44%







409.02%



293.29%



487.78%Allowance for loan losses to total loans


1.34%



1.10%







0.73%



0.67%



0.67%Capital Ratios:Equity to total assets at end of period


13.48%



8.64%







8.77%



12.29%



14.04%Average equity to average assets


11.59%



8.73%







10.59%



13.22%



9.69%Other Data:Number of community bank offices


23



23
(2)






30



28



31Number of loan production offices


14



15







15



9



3     *
    
    Number is not meaningful  (1)
    
    Calculated by dividing total
    non-interest expense by net interest income plus non-interest
    income, excluding impairment on securities.(2)
    
    In 2009, we opened three new
    full-service community bank offices in Grapevine, Frisco and
    Wylie. On January 2, 2009, we announced plans to expand our
    community banking network by opening more free-standing,
    full-service community bank offices and transition away from
    limited-service grocery store banking centers. As a result, we
    closed ten in-store banking centers located in Carrollton,
    Dallas, Garland, Plano, McKinney, Frisco and Wylie in 2009. 48




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##### Table of Contents



Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  General
      Critical
    Accounting Policies
  other-than-temporary
  Allowance for Loan Loss.
    Other-than-Temporary
    Impairments. other-than-temporary
 49




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##### Table of Contents



other-than-temporary
  Business
    Strategy
    
    Continuing the growth and diversification of our loan
    portfolio.    
    Maintaining our historically high level of asset quality.    
    Capturing our customers full relationship.   50




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##### Table of Contents




    Expanding our reach.    Comparison
    of Financial Condition at December 31, 2010, and
    December 31, 2009
  General.
  Loans.
  December 31,


December 31,


Dollar


Percent2010


2009


Change


Change(Dollars in thousands)Real estate loans:One- to four-family

$
393,896


$
421,935


$
(28,039
)


(6.6
%)Commercial real estate


479,071



453,604



25,467



5.6One- to four-family construction


11,435



6,195



5,240



84.6Commercial construction


569



879



(310
)


(35.3
)Loans held for sale


491,985



341,431



150,554



44.1Home equity


115,418



116,138



(720
)


(0.6
)Total real estate loans


1,492,374



1,340,182



152,192



11.4Automobile loans


42,550



67,897



(25,347
)


(37.3
)Other consumer loans


24,816



26,998



(2,182
)


(8.1
)Commercial non-mortgage loans


39,279



27,983



11,296



40.4Total other loans


106,645



122,878



(16,233
)


(13.2
)Gross loans

$
1,599,019


$
1,463,060


$
135,959



9.3
%    51




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##### Table of Contents



Texas


89
%Oklahoma


4Louisiana


2Illinois


2California


2Other*


1100
%     *
    
    Other consists of
    Arizona, Georgia, Nevada, New Mexico, Oregon, and Washington    Allowance for Loan Losses.
  and/or
   52




---



##### Table of Contents



sub-prime
  and/or ASC 310-40,
        Securities. ASC 320-10. step-up
 53




---



##### Table of Contents



Deposits.
  December 31,


December 31,


Dollar


Percent2010


2009


Change


Change(Dollars in thousands)Non-interest bearing demand

$
201,998


$
193,581


$
8,417



4.3
%Interest bearing demand


438,719



268,063



170,656



63.7Savings


148,399



143,506



4,893



3.4Money Market


554,261



549,619



4,642



0.8IRA savings


9,251



8,710



541



6.2Time


664,922



633,186



31,736



5.0Total deposits

$
2,017,550


$
1,796,665


$
220,885



12.3
%       Borrowings.
   54




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##### Table of Contents



WeightedAverageBalance


RateLess than 90 days


204,058



0.25
%Less than one year


14,299



3.91One to three years


53,854



2.94Three to five years


98,259



3.36After five years


96,008



3.27466,478



1.95
%Restructuring prepayment penalty


(5,259
)Total

$
461,219   Shareholders Equity.
  December 31,


December 31,


Dollar


Percent2010


2009


Change


Change(Dollars in Thousands)Common stock

$
349


$
305


$
44



14.4
%Additional paid-in capital


289,591



118,254



171,337



144.9Retained Earnings


125,125



111,188



13,937



12.5Accumulated other comprehensive income (loss)


2,373



3,802



(1,429
)


(37.6
)Unearned ESOP shares


(20,849
)


(6,159
)


(14,690
)


238.5Treasury stock


-



(21,708
)


21,708



100.0Total shareholders equity

$
396,589


$
205,682


$
190,907



92.8
%      55




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##### Table of Contents



Comparison
    of Results of Operation for the Years Ended December 31,
    2010 and 2009
  General.
  Interest Income.
  Year EndedDecember 31,


Dollar


Percent2010


2009


Change


Change(Dollars in Thousands)Interest and dividend incomeLoans, including fees

$
88,550


$
83,802


$
4,748



5.7
%Securities


26,365



23,436



2,929



12.5Interest bearing deposits in other financial institutions


402



652



(250
)


(38.3
)FHLB stock


68



16



52



325.0$
115,385


$
107,906


$
7,479



6.9
%       Interest Expense.
 56




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##### Table of Contents



Year EndedDecember 31,


Dollar


Percent2010


2009


Change


Change(Dollars in Thousands)Interest expenseDeposits

$
31,015


$
34,366


$
(3,351
)


(9.8
%)FHLB advances


11,723



14,056



(2,333
)


(16.6
)Repurchase agreement


816



707



109



15.4Other borrowings


599



157



442



281.5$
44,153


$
49,286


$
(5,133
)


(10.4
%)       2-year
  Net Interest Income.
  Provision for Loan Losses.
 57




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##### Table of Contents



Non-interest Income.
  Year EndedDecember 31,


Dollar


Percent2010


2009


Change


Change(Dollars in Thousands)Non-interest incomeService charges and fees

$
18,505


$
18,954


$
(449
)


(2.4
%)Brokerage fees


476



347



129



37.2Net gain on sale of loans


13,041



16,591



(3,550
)


(21.4
)Loan servicing fees


235



239



(4
)


(1.7
)Bank-owned life insurance income


384



539



(155
)


(28.8
)Valuation adjustment on mortgage servicing rights


15



(191
)


206



N/MImpairment of collateralized debt obligation (all credit)


-



(12,246
)


12,246



N/MGain on sale of available for sale securities


-



2,377



(2,377
)


N/MGain (loss) on sale of foreclosed assets


(296
)


179



(475
)


N/MGain (loss) on disposition of assets


(69
)


(1,220
)


1,151



94.3Other


1,173



1,630



(457
)


(28.0
)$
33,464


$
27,199


$
6,265



23.0
%          58




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##### Table of Contents



Non-interest Expense.
  Year EndedDecember 31,


Dollar


Percent2010


2009


Change


Change(Dollars in Thousands)Non-interest expenseSalaries and employee benefits

$
46,203


$
46,777


$
(574
)


(1.2
%)Advertising


1,285



1,284



1



0.1Occupancy and equipment


5,907



5,999



(92
)


(1.5
)Outside professional services


2,369



1,882



487



25.9Regulatory assessments


3,235



4,018



(783
)


(19.5
)Data processing


4,232



4,209



23



0.5Office operations


5,790



5,984



(194
)


(3.2
)Deposit processing charges


744



862



(118
)


(13.7
)Lending and collection


1,033



883



150



17.0Other


2,348



2,639



(291
)


(11.0
)$
73,146


$
74,537


$
(1,391
)


(1.9
%)         Income Tax Expense.
  Comparison
    of Results of Operation for the Years Ended December 31,
    2009 and 2008
  General.
 59




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##### Table of Contents



other-than-temporary
  Interest Income.
  Year EndedDecember 31,


Dollar


Percent2009


2008


Change


Change(Dollars in Thousands)Interest and dividend incomeLoans, including fees

$
83,802


$
65,938


$
17,864



27.1
%Securities


23,436



29,391



(5,955
)


(20.3
)Interest bearing deposits in other financial institutions


652



1,195



(543
)


(45.4
)FHLB stock


16



271



(255
)


(94.1
)$
107,906


$
96,795


$
11,111



11.5
%       Interest Expense.
  Year EndedDecember 31,


Dollar


Percent2009


2008


Change


Change(Dollars in Thousands)Interest expenseDeposits

$
34,366


$
35,529


$
(1,163
)


(3.3
%)FHLB advances


14,056



10,340



3,716



35.9Repurchase agreement


707



300



407



135.7Other borrowings


157



-



157



N/M$
49,286


$
46,169


$
3,117



6.8
%    60




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##### Table of Contents



2-year
    Net Interest Income.
  Provision for Loan Loss
     61




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##### Table of Contents



Non-interest Income.
  Year EndedDecember 31,


Dollar


Percent2009


2008


Change


Change(Dollars in Thousands)Non-interest incomeService charges and fees

$
18,954


$
19,779


$
(825
)


(4.2
%)Brokerage fees


347



434



(87
)


(20.0
)Net gain on sale of loans


16,591



9,390



7,201



76.7Loan servicing fees


239



252



(13
)


(5.2
)Bank-owned life insurance income


539



1,081



(542
)


(50.1
)Gain on redemption of Visa, Inc. shares


-



771



(771
)


(100.0
)Valuation adjustment on mortgage servicing rights


(191
)


-



(191
)


N/MImpairment of collateralized debt obligation (all credit)


(12,246
)


(13,809
)


1,563



11.3Gain on sale of available for sale securities


2,377



-



2,377



N/MGain (loss) on sale of foreclosed assets


179



(43
)


222



N/MGain (loss) on disposition of assets


(1,220
)


16



(1,236
)


N/MOther


1,630



993



637



64.1$
27,199


$
18,864


$
8,335



44.2
%     other-than-temporary No. 115-2 No. 124-2 ,
    Recognition and Presentation of
    Other-Than-Temporary
    Impairments 320-10), other-than-temporary other-than-temporary
  other-than-temporary ASC 325-40 ASC 325-40,
   62




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##### Table of Contents



Non-interest Expense.
  Year EndedDecember 31,


Dollar


Percent2009


2008


Change


ChangeNon-interest expense

(Dollars in Thousands)Salaries and employee benefits

$
46,777


$
43,560


$
3,217



7.4
%Advertising


1,284



2,296



(1,012
)


(44.1
)Occupancy and equipment


5,999



5,772



227



3.9Outside professional services


1,882



2,004



(122
)


(6.1
)Regulatory assessments


4,018



1,225



2,793



228.0Data processing


4,209



4,001



208



5.2Office operations


5,984



6,111



(127
)


(2.1
)Deposit processing charges


862



990



(128
)


(12.9
)Lending and collection


883



828



55



6.6Other


2,639



2,124



515



24.2$
74,537


$
68,911


$
5,626



8.2
%    63




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##### Table of Contents



Income Tax Expense.
 64




---



##### Table of Contents



Average
    Balances, Net Interest Income, Yields Earned and Rates
    Paid
    Year Ended December 31,2010


2009


2008Average








Average








AverageOutstanding


Interest





Outstanding


Interest





Outstanding


InterestBalance


Earned/Paid


Yield/Rate


Balance


Earned/Paid


Yield/Rate


Balance


Earned/Paid


Yield/Rate(Dollars in thousands)Interest-earning assets:One- to four- family real estate

$
413,625


$
22,934



5.54%


$
472,291


$
26,769



5.67%


$
431,155


$
24,279



5.63%Loans held for sale


407,287



19,781



4.86



249,553



12,080



4.84



23,959



1,186



4.95Commercial real estate


473,400



32,006



6.76



431,914



28,788



6.67



355,332



22,169



6.24Home equity


108,705



6,513



5.99



99,376



5,977



6.01



91,842



5,784



6.30Consumer


80,298



5,038



6.27



115,937



7,202



6.21



176,779



10,771



6.09Commercial non-mortgage


35,283



2,278



6.46



60,275



2,986



4.95



33,136



1,749



5.28Less: deferred fees and allowance for loan loss


(14,352
)


-



-



(11,015
)


-



-



(7,723
)


-



-Loans receivable
    (1)


1,504,246



88,550



5.89



1,418,331



83,802



5.91



1,104,480



65,938



5.97Agency mortgage-backed securities


466,536



13,959



2.99



300,006



12,131



4.04



224,057



10,881



4.86Agency collateralized mortgage obligations


361,453



9,025



2.50



291,949



9,601



3.29



330,580



15,505



4.69Investment securities


100,879



3,381



3.35



52,754



1,704



3.23



57,311



3,005



5.24FHLB stock


16,939



68



0.40



15,469



16



0.10



11,509



271



2.35Interest earning deposit accounts


90,614



402



0.44



74,356



652



0.88



50,766



1,195



2.35Total interest-earning assets


2,540,667



115,385



4.54



2,152,865



107,906



5.01



1,778,703



96,795



5.44Non-interest-earning assets


157,703











132,361











117,254Total assets

$
2,698,370










$
2,285,226










$
1,895,957Interest-bearing liabilities:Interest-bearing demand


374,083



8,976



2.40%



163,996



3,350



2.04%



78,396



868



1.11%Savings and money market


718,224



9,102



1.27



670,518



12,007



1.79



599,659



14,442



2.41Time


658,988



12,937



1.96



661,231



19,009



2.87



518,302



20,219



3.90Borrowings


399,880



13,138



3.29



374,029



14,920



3.99



264,834



10,640



4.02Total interest-bearing liabilities


2,151,175



44,153



2.05



1,869,774



49,286



2.64



1,461,191



46,169



3.16Non-interest-bearing checking


183,720











175,797











170,075Non-interest-bearing liabilities


50,853











40,096











63,956Total liabilities


2,385,748











2,085,667











1,695,222Total capital


312,622











199,559











200,735Total liabilities and capital

$
2,698,370










$
2,285,226










$
1,895,957Net interest income and margin





$
71,232



2.80%






$
58,620



2.72%






$
50,626



2.85%Net interest income and margin (tax-equivalent
    basis)(2)





$
72,096



2.84%






$
58,886



2.74%






$
50,690



2.85%Net interest rate spread










2.49%











2.37%











2.28%Net earning assets

$
389,492










$
283,091










$
317,512Average interest-earning assets to average interest-bearing
    liabilities


118.11%











115.14%











121.73%     (1)
    
    Calculated net of deferred fees,
    loan discounts, loans in process and allowance for loan losses.
    Includes loans held for sale. Construction loans have been
    included in the one- to four- family and commercial real estate
    line items, as appropriate.(2)
    
    In order to make pretax income and
    resultant yields on tax-exempt investments and loans comparable
    to those on taxable investments and loans, a tax-equivalent
    adjustment has been computed using a federal income tax rate of
    35% for 2010 and 34% for 2009 and 2008. Tax-exempt investments
    and loans had an average balance of $41.7 million,
    $13.8 million and $3.4 million for the years ended
    December 31, 2010, 2009 and 2008, respectively. 65




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##### Table of Contents



Rate/Volume
    Analysis
    Year Ended December 31,2010 versus 2009


2009 versus 2008Total








TotalIncrease (Decrease) Due to


Increase


Increase (Decrease) Due to


IncreaseVolume


Rate


(Decrease)


Volume


Rate


(Decrease)(Dollars in thousands)Interest-earning assets:One- to four- family real estate

$
(3,264
)

$
(571
)

$
(3,835
)

$
2,331


$
159


$
2,490Loans held for sale


7,661



40



7,701



10,921



(27
)


10,894Commercial real estate


2,800



418



3,218



5,026



1,593



6,619Home equity


559



(23
)


536



461



(268
)


193Consumer


(2,235
)


71



(2,164
)


(3,776
)


207



(3,569
)Commercial non-mortgage


(1,455
)


747



(708
)


1,351



(114
)


1,237Loans receivable


4,066



682



4,748



16,314



1,550



17,864Agency mortgage-backed securities


5,541



(3,713
)


1,828



3,275



(2,025
)


1,250Agency collateralized mortgage obligations


2,012



(2,588
)


(576
)


(1,660
)


(4,244
)


(5,904
)Investment securities


1,611



66



1,677



(223
)


(1,078
)


(1,301
)FHLB stock


2



50



52



70



(325
)


(255
)Interest earning deposit accounts


121



(371
)


(250
)


407



(950
)


(543
)Total interest-earning assets


13,353



(5,874
)


7,479



18,183



(7,072
)


11,111Interest-bearing liabilities:Interest-bearing demand


4,951



675



5,626



1,399



1,083



2,482Savings and money market


805



(3,710
)


(2,905
)


1,568



(4,003
)


(2,435
)Time


(64
)


(6,008
)


(6,072
)


4,825



(6,035
)


(1,210
)Borrowings


980



(2,762
)


(1,782
)


4,356



(76
)


4,280Total interest bearing liabilities


6,672



(11,805
)


(5,133
)


12,148



(9,031
)


3,117Net interest income

$
6,681


$
5,931


$
12,612


$
6,035


$
1,959


$
7,994   Liquidity
     66




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##### Table of Contents



available-for-sale available-for-sale held-to-maturity
 67




---



##### Table of Contents



available-for-sale
  Form 10-K
  Off-Balance
    Sheet Arrangements, Contractual Obligations and
    Commitments
    December 31, 2010Onethrough


FourLess than


Three


through


After FiveOne Year


Years


Five Years


Years


Total(Dollars in thousands)Contractual obligations:FHLB advances (gross of restructuring prepayment penalty of
    $5,259)

$
218,357


$
53,854


$
98,259


$
96,008


$
466,478Repurchase agreement


-



-



-



25,000



25,000Other borrowings


-



-



10,000



-



10,000Operating leases (premises)


1,079



1,592



724



2,851



6,246Total advances and operating leases

$
219,436


$
55,446


$
108,983


$
123,859


$
507,724Off-balance sheet loan
    commitments:(1)Undisbursed portions of loans closed

$
41,800


$
-


$
-


$
-


$
41,800Commitments to originate loans


64,864



-



-



-



64,864Unused commitment on Warehouse Purchase Program loans


289,088



-



-



-



289,088Unused lines of credit


79,170



-



-



-



79,170Total loan commitments

$
474,922


$
-


$
-


$
-


$
474,922Total contractual obligations and loan commitments

















$
982,646     (1)

    
    Loans having no stated maturity are reported in the Less
    than One Year category.  Capital
    Resources
     68




---



##### Table of Contents



Impact of
    Inflation
    Recent
    Accounting Pronouncements
    Item 7A.
    Quantitative
    and Qualitative Disclosures about Market Risk  Asset/Liability
    Management
  Our Risk When Interest Rates Change.
  How We Measure Our Risk of Interest Rate
    Changes.
     69




---



##### Table of Contents



70




---



##### Table of Contents



December 31, 2010Change in InterestRates in BasisPoints

Net Portfolio Value


NPV$ Amount


$ Change


% Change


Ratio %(Dollars in Thousands)300



244,653



(80,376
)


(24.73
)


8.84200



276,441



(48,588
)


(14.95
)


9.75100



304,179



(20,850
)


(6.41
)


10.48-



325,029



-



-



10.96(100)



327,497



2,468



0.76



10.89(200)



326,489



1,460



0.45



10.74   December 31, 2009Change in InterestRates in BasisPoints

Net Portfolio Value


NPV$ Amount


$ Change


% Change


Ratio %(Dollars in Thousands)300



174,615



(42,468
)


(19.56
)


7.82200



192,168



(24,915
)


(11.48
)


8.41100



207,861



(9,222
)


(4.25
)


8.90-



217,083



-



-



9.11(100)



218,003



920



0.42



9.00(200)



221,750



4,667



2.15



9.01   and/or
     71




---



##### Table of Contents



72




---



##### 



Item 8.
    Financial Statements and Supplementary Data
    VIEWPOINT FINANCIAL GROUP, INC.
    FINANCIAL STATEMENTS
    December 31, 2010, 2009, and 2008



INDEX PageREPORTS OF INDEPENDENT REGISTERED PUBLIC
    ACCOUNTING FIRM


75CONSOLIDATED FINANCIAL STATEMENTSConsolidated Balance Sheets


76Consolidated Statements of Income (Loss)


77Consolidated Statements of Comprehensive Income
    (Loss)


78Consolidated Statements of Changes in
    Shareholders Equity


79Consolidated Statements of Cash Flows


81Notes to Consolidated Financial Statements


82   73




---



##### Table of Contents



Report of
    Ernst & Young LLP
    Independent Registered Public Accounting Firm
   
          
    74




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                 75




---



##### Table of Contents



CONSOLIDATED
    BALANCE SHEETSDecember 31,
    (Dollar amounts in thousands, except share data) 2010


2009ASSETSCash and due from financial institutions

$
16,465


$
17,507Short-term interest-bearing deposits in other financial
    institutions


52,185



37,963Total cash and cash equivalents


68,650



55,470Securities available for sale, at fair value


717,497



484,058Securities held to maturity (fair value: December 31,
    2010  $434,296,December 31, 2009  $260,814)


432,519



254,724Loans held for sale (includes $16,877 carried at fair value at
    December 31, 2010)


491,985



341,431Loans held for investment (includes allowance for loan losses of
    $14,847 at December 31, 2010 and $12,310 at
    December 31, 2009)


1,092,114



1,108,159FHLB stock, at cost


20,569



14,147Bank-owned life insurance


28,501



28,117Mortgage servicing rights


636



872Foreclosed assets, net


2,679



3,917Premises and equipment, net


48,731



50,440Goodwill


1,089



1,089Accrued interest receivable


9,248



8,099Prepaid FDIC assessment


6,606



9,134Other assets


21,171



19,847Total assets

$
2,941,995


$
2,379,504LIABILITIES AND SHAREHOLDERS EQUITYDepositsNon-interest-bearing demand


201,998



193,581Interest-bearing demand


438,719



268,063Savings and money market


711,911



701,835Time


664,922



633,186Total deposits


2,017,550



1,796,665FHLB advances (net of prepayment penalty of $5,259 at
    December 31, 2010)


461,219



312,504Repurchase agreement


25,000



25,000Other borrowings


10,000



10,000Accrued interest payable


1,541



1,884Other liabilities


30,096



27,769Total liabilities


2,545,406



2,173,822Commitments and contingent liabilities


-



-Shareholders equityCommon stock, $.01 par value; 90,000,000 sharesauthorized; 34,839,491 shares issued 
    December 31, 2010and 30,496,710 shares issued  December 31,
    2009


349



305Additional paid-in capital


289,591



118,254Retained earnings


125,125



111,188Accumulated other comprehensive income, net


2,373



3,802Unearned Employee Stock Ownership Plan (ESOP) shares;
    2,286,428 sharesat December 31, 2010 and 854,906 shares at
    December 31, 2009


(20,849
)


(6,159
)Treasury stock, at cost; 1,279,801 shares at
    December 31, 2009


-



(21,708
)Total shareholders equity


396,589



205,682Total liabilities and shareholders equity

$
2,941,995


$
2,379,504    76




---



##### Table of Contents



CONSOLIDATED STATEMENTS OF INCOME
    (LOSS)Years ended December 31,
    (Dollar amounts in thousands, except per share data)
  2010


2009


2008Interest and dividend incomeLoans, including fees

$
88,550


$
83,802


$
65,938Taxable securities


24,837



22,919



29,266Nontaxable securities


1,528



517



125Interest bearing deposits in other financial institutions


402



652



1,195FHLB stock


68



16



271115,385



107,906



96,795Interest expenseDeposits


31,015



34,366



35,529FHLB advances


11,723



14,056



10,340Repurchase agreement


816



707



300Other borrowings


599



157



-44,153



49,286



46,169Net interest income


71,232



58,620



50,626Provision for loan losses


5,119



7,652



6,171Net interest income after provision for loan losses


66,113



50,968



44,455Non-interest incomeService charges and fees


18,505



18,954



19,779Brokerage fees


476



347



434Net gain on sale of loans


13,041



16,591



9,390Loan servicing fees


235



239



252Bank-owned life insurance income


384



539



1,081Gain on redemption of Visa, Inc. shares


-



-



771Fair value adjustment on mortgage servicing rights


15



(191
)


-Impairment of collateralized debt obligations (all credit)


-



(12,246
)


(13,809
)Gain on sale of available for sale securities


-



2,377



-Gain (loss) on sale of foreclosed assets


(296
)


179



(43
)Gain (loss) on disposition of assets


(69
)


(1,220
)


16Other


1,173



1,630



99333,464



27,199



18,864Non-interest expenseSalaries and employee benefits


46,203



46,777



43,560Advertising


1,285



1,284



2,296Occupancy and equipment


5,907



5,999



5,772Outside professional services


2,369



1,882



2,004Regulatory assessments


3,235



4,018



1,225Data processing


4,232



4,209



4,001Office operations


5,790



5,984



6,111Deposit processing charges


744



862



990Lending and collection


1,033



883



828Other


2,348



2,639



2,12473,146



74,537



68,911Income (loss) before income tax expense (benefit)


26,431



3,630



(5,592
)Income tax expense (benefit)


8,632



960



(2,277
)Net income (loss)

$
17,799


$
2,670


$
(3,315
)Earnings (loss) per share:Basic

$
0.59


$
0.10


$
(0.12
)Diluted

$
0.59


$
0.10


$
(0.12
)    77




---



##### Table of Contents



CONSOLIDATED STATEMENTS OF
    COMPREHENSIVE INCOME (LOSS)Years ended December 31,
    (Dollar amounts in thousands)
  2010


2009


2008Net income (loss)

$
17,799


$
2,670


$
(3,315
)Other comprehensive income (loss):Change in unrealized gains (losses) on securities available for
    sale


(2,132
)


1,261



(17,545
)Reclassification of amount realized through impairment charges


-



12,246



13,809Reclassification of amount realized through sale of securities


-



(2,377
)


-Tax effect


703



(2,872
)


1,262Other comprehensive income (loss), net of tax


(1,429
)


8,258



(2,474
)Comprehensive income (loss)

$
16,370


$
10,928


$
(5,789
)    78




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##### Table of Contents



CONSOLIDATED STATEMENTS OF CHANGES
    IN SHAREHOLDERS EQUITYYears ended December 31,
    (Dollar amounts in thousands, except per share and share data)
  AccumulatedAdditional








Other





TotalCommon


Paid-In


Unearned


Retained


Comprehensive





ShareholdersStock


Capital


ESOP Shares


Earnings


Income (Loss)


Treasury Stock


EquityBalance at January 1, 2008

$
305


$
113,569


$
(8,176
)

$
114,801


$
861


$
(17,566
)

$
203,794ESOP shares earned, 151,137 shares


-



881



1,079



-



-



-



1,960Treasury stock purchased at cost, 289,346 shares


-



-



-



-



-



(4,312
)


(4,312
)Share-based compensation expense


-



1,719



-



-



-



-



1,719Adjustment to deferred tax asset for difference between fair
    value of vested restricted stock and expense booked


-



(79
)


-



-



-



-



(79
)Restricted stock granted (14,000 shares)


-



(170
)


-



-



-



170



-Dividends declared ($0.21 per share)


-



-



-



(3,154
)


-



-



(3,154
)Comprehensive loss:Net loss


-



-



-



(3,315
)


-



-



(3,315
)Change in unrealized gains (losses) on securities available for
    sale, net of reclassifications and taxes


-



-



-



-



(2,474
)


-



(2,474
)Total comprehensive loss


























(5,789
)Balance at December 31, 2008


305



115,920



(7,097
)


108,332



(1,613
)


(21,708
)


194,139Cumulative effect of change in accounting principle, initial
    application of
    other-than-temporary
    impairment guidance (net of tax)


-



-



-



2,843



(2,843
)


-



-ESOP shares earned, 131,242 shares


-



707



938



(185
)


-



-



1,460Share-based compensation expense


-



1,763



-



-



-



-



1,763Adjustment to deferred tax asset for difference between fair
    value of vested restricted stock and expense booked


-



(136
)


-



-



-



-



(136
)Dividends declared ($0.18 per share)


-



-



-



(2,472
)


-



-



(2,472
)Comprehensive income:Net income


-



-



-



2,670



-



-



2,670Change in unrealized gains (losses) on securities available for
    sale for which a portion of an
    other-than-temporary
    impairment has been recognized in earnings, net of
    reclassifications and taxes


-



-



-



-



7,101



-



7,101Change in unrealized gains (losses) on securities available for
    sale, net of reclassifications and taxes


-



-



-



-



1,157



-



1,157Total comprehensive income


























10,928Balance at December 31, 2009


305



118,254



(6,159
)


111,188



3,802



(21,708
)


205,682  79




---



##### Table of Contents



AccumulatedAdditional








Other





TotalCommon


Paid-In


Unearned


Retained


Comprehensive





ShareholdersStock


Capital


ESOP Shares


Earnings


Income (Loss)


Treasury Stock


EquityBalance at December 31, 2009


305



118,254



(6,159
)


111,188



3,802



(21,708
)


205,682ESOP shares earned, 157,065 shares


-



686



1,196



-



-



-



1,882Share-based compensation expense


-



1,802



-



-



-



-



1,802Restricted stock forfeiture


-



334



-



-



-



(334
)


-Treasury stock purchased at cost, 25,634 shares


-



-



-



-



-



(407
)


(407
)Treasury stock retired, 25,309 shares


-



(334
)














334



-Dividends declared ($0.16 per share)


-



-



-



(3,862
)


-



-



(3,862
)Items relating to Conversion and stock offering:Merger of ViewPoint MHC pursuant to reorganization


-



207



-



-



-



-



207Treasury stock retired pursuant to reorganization
    (1,305,435 shares)


(13
)


(22,102
)


-



-



-



22,115



-Cancellation of ViewPoint MHC shares (14,183,812 shares)


(142
)


142



-



-



-



-



-Proceeds from stock offering (19,857,337 shares), net of
    expense of $7,773


199



190,602



-



-



-



-



190,801Purchase of shares by ESOP pursuant to reorganization
    (1,588,587 shares)


-



-



(15,886
)


-



-



-



(15,886
)Comprehensive income:Net income


-



-



-



17,799



-



-



17,799Change in unrealized gains (losses) on securities available for
    sale, net of reclassifications and taxes


-



-



-



-



(1,429
)


-



(1,429
)Total comprehensive income


























16,370Balance at December 31, 2010

$
349


$
289,591


$
(20,849
)

$
125,125


$
2,373


$
-


$
396,589    80




---



##### Table of Contents



CONSOLIDATED STATEMENTS OF CASH
    FLOWSYears ended December 31,
    (Dollar amounts in thousands)
  2010


2009


2008Cash flows from operating activitiesNet income (loss)

$
17,799


$
2,670


$
(3,315
)Adjustments to reconcile net income (loss) to net cash from
    operating activities:Provision for loan losses


5,119



7,652



6,171Depreciation and amortization


3,571



3,784



4,365Deferred tax expense (benefit)


(794
)


3,951



(5,304
)Premium amortization and accretion of securities, net


3,832



1,034



(767
)Gain on sale of available for sale securities


-



(2,377
)


-Impairment of collateralized debt obligations


-



12,246



13,809ESOP compensation expense


1,882



1,460



1,960Share-based compensation expense


1,802



1,763



1,719Amortization of mortgage servicing rights


251



309



292Net gain on loans held for sale


(13,041
)


(16,591
)


(9,390
)Loans originated or purchased for sale


(7,877,505
)


(5,742,599
)


(591,218
)Proceeds from sale of loans held for sale


7,739,992



5,577,643



453,896FHLB stock dividends


(68
)


(16
)


(271
)Increase in bank-owned life insurance


(384
)


(539
)


(1,081
)Loss (gain) on disposition of property and equipment


250



34



(16
)Write off of leasehold improvements related to in-store location
    closings


-



337



-Net loss (gain) on sales of other real estate owned


296



(195
)


106Valuation adjustment on mortgage servicing rights


(15
)


191



-Net change in deferred loan fees


(1,087
)


(46
)


1,809Net change in accrued interest receivable


(1,149
)


420



(1,741
)Net change in other assets


2,279



(14,757
)


916Net change in other liabilities


2,687



(5,692
)


7,701Net cash from operating activities


(114,283
)


(169,318
)


(120,359
)Cash flows from investing activitiesDistribution from (contribution to) new markets equity fund


458



-



(1,554
)Available-for-sale
    securities:Maturities, prepayments and calls


562,924



509,350



109,051Purchases


(801,282
)


(582,025
)


(66,098
)Proceeds from sale of AFS securities


-



73,785



-Held-to-maturity
    securities:Maturities, prepayments and calls


69,788



49,649



24,506Purchases


(248,628
)


(132,446
)


(176,630
)Proceeds from member capital account


-



-



1,000Net change in loans


8,259



118,266



(341,728
)Redemption/(purchase) of FHLB stock


(6,354
)


3,965



(11,605
)Purchases of premises and equipment


(2,114
)


(8,667
)


(9,460
)Proceeds from sale of fixed assets


2



9



36Proceeds on sale of other real estate owned


3,957



2,623



1,455Net cash from investing activities


(412,990
)


34,509



(471,027
)Cash flows from financing activitiesNet change in deposits


220,885



248,575



250,497Net proceeds from stock offering


190,801



-



-Purchase of shares by ESOP pursuant to reorganization


(15,886
)


-



-Merger of ViewPoint MHC pursuant to reorganization


207



-



-Proceeds from FHLB advances


291,645



-



313,000Repayments on FHLB advances


(142,930
)


(98,337
)


(30,610
)Proceeds from other borrowings


-



10,000



-Proceeds from repurchase agreement


-



-



25,000Treasury stock purchased


(407
)


-



(4,312
)Payment of dividends


(3,862
)


(2,472
)


(3,154
)Net cash from financing activities


540,453



157,766



550,421Net change in cash and cash equivalents


13,180



22,957



(40,965
)Beginning cash and cash equivalents


55,470



32,513



73,478Ending cash and cash equivalents

$
68,650


$
55,470


$
32,513Supplemental cash flow information:Interest paid

$
44,496


$
49,171


$
45,382Income taxes paid

$
5,948


$
1,790


$
1,917Supplemental noncash disclosures:Transfers from loans to other real estate owned

$
3,754


$
5,677


$
2,690    81




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
  NOTE 1 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES  Nature of Operations and Principles of Consolidation
    Use of Estimates other-than-temporary
  Cash Flows
  Securities
    other-than-temporary
  other-than-temporary
 82




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 1 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING
    POLICIES(Continued)    Loans Held for Sale
  The Fair Value Option
    for Financial Assets and Financial Liabilities
  Loans
      Concentration of Credit Risk
  Allowance for Loan Losses
 83




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 1 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING
    POLICIES(Continued)    non-classified
    ASC 310-40 ASC 310-10-35-2
    Servicing Rights
   84




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 1 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING
    POLICIES(Continued)      Transfers of Financial Assets
  Foreclosed Assets
  Premises and Equipment
  Federal Home Loan Bank (FHLB) stock:
  Bank-Owned Life Insurance
  Goodwill
  Long-term Assets
 85




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 1 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING
    POLICIES(Continued)  Brokerage Fee Income
  Mortgage Subservicing Revenue
  Deferred Revenue:
  Advertising Expense
  Loan Commitments and Related Financial Instruments
  Income Taxes
    and/or
  Share-Based Compensation
  Retirement Plans:
  Comprehensive Income (Loss)
 86




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 1 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING
    POLICIES(Continued)  Loss Contingencies
  Restrictions on Cash
  Earnings (loss) per common share
  Employee stock ownership plan (ESOP) 718-40, Employee Stock Ownership Plans
    Dividend Restriction
  Fair Value of Financial Instruments
  Operating Segments:
  Reclassifications
  Adoption of New Accounting Standards
  Accounting for
    Transfers of Financial Assets, an Amendment of FASB Statement
    No. 140
 87




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 1 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING
    POLICIES(Continued)    Amendments to FASB Interpretation No. 46 (R)
  No. 2010-06, Fair Value Measurements and Disclosures (Topic
    820)  Improving Disclosures about Fair Value
    Measurements 820-10 820-10
  No. 2010-09, Subsequent Events (Topic 855)  Amendments to
    Certain Recognition and Disclosure Requirements 855-10 855-10
  No. 2010-11 ,
    Derivatives and Hedging (Topic 815): Scope Exception Related to
    Embedded Credit Derivatives.
 88




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 1 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING
    POLICIES(Continued)    No. 2010-18, Receivables (Topic 310): Effect of a Loan Modification When
    the Loan Is Part of a Pool That Is Accounted for as a Single
    Asset. No. 09-I, Effect of a Loan Modification When the Loan Is Part of a Pool
    That Is Accounted for as a Single Asset. FASB Accounting Standards
    Codification tm 310-30 2010-18 310-30 310-30 310-40.
  No. 2010-20, Receivables (Topic 310): Disclosures about the Credit Quality
    of Financing Receivables and the Allowance for Credit
    Losses
  Form 10-K
  Effect of Newly Issued But Not Yet Effective Accounting
    Standards
  No. 2010-28 ,
    Intangibles, Goodwill and Other (Topic 350): When to Perform
    Step 2 of the Goodwill Impairment Test for Reporting Units with
    Zero or Negative Carrying Amounts (a consensus of the FASB
    Emerging Issues Task Force).
  No. 2011-01 ,
    Receivables (Topic310): Deferral of the Effective Date of
    Disclosures about Troubled Debt Restructurings in Update
    No. 2010-20 No. 2010-20, Receivables
 89




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 1 
    SUMMARY
    OF SIGNIFICANT ACCOUNTING
    POLICIES(Continued)  (Topic 310): Disclosures about the Credit Quality of
    Financing Receivables and the Allowance for Credit Losses
  NOTE 2 
    SHARE
    TRANSACTIONS             90




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 2 
    SHARE
    TRANSACTIONS(Continued)      NOTE 3 
    EARNINGS
    (LOSS) PER SHARE    ASC 260-10-45-60B.
 91




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 3 
    EARNINGS
    (LOSS) PER
    SHARE(Continued)    2010


2009


2008BasicNet income (loss)

$
17,799


$
2,670


$
(3,315
)Weighted average common shares outstanding


31,977,020



29,216,909



29,366,350Less: Average unallocated ESOP shares


(1,567,687
)


(925,351
)


(1,067,428
)Average unvested restricted stock awards


(280,348
)


(409,617
)


(530,277
)Average shares


30,128,985



27,881,941



27,768,645Basic earnings (loss) per common share

$
0.59


$
0.10


$
(0.12
)DilutedNet income (loss)

$
17,799


$
2,670


$
(3,315
)Weighted average common shares outstanding for basicearnings (loss) per common share


30,128,985



27,881,941



27,768,645Add: Dilutive effects of assumed exercises of stock options


-



-



-Dilutive effects of full vesting of stock awards


2,975



-



-Average shares and dilutive potential common shares


30,131,960



27,881,941



27,768,645Diluted earnings (loss) per common share

$
0.59


$
0.10


$
(0.12
)     NOTE 4 
    CONCENTRATION
    OF FUNDS    December 31,2010


2009Federal Reserve Bank of Dallas

$
44,183


$
12,729FHLB of Dallas


2,806



2,233Texas Capital Bank


5,027



23,063JPMorgan Chase & Co.


199



--$
52,215


$
38,025      92




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 4 
    CONCENTRATION
    OF
    FUNDS(Continued)    NOTE 5 
    SECURITIES  available-for-sale
  Gross


GrossAmortized


Unrealized


UnrealizedDecember 31, 2010

Cost


Gains


Losses


Fair ValueU.S. government and federal agency

$
-


$
-


$
-


$
-Agency residential mortgage-backed securities


351,385



4,545



(1,433
)


354,497Agency residential collateralized mortgage obligations


357,340



3,031



(2,479
)


357,892SBA pools


5,084



24



-



5,108Total securities

$
713,809


$
7,600


$
(3,912
)

$
717,497   Gross Unrealized


Gross UnrealizedDecember 31, 2009

Amortized Cost


Gains


Losses


Fair ValueU.S. government and federal agency

$
47,994


$
-


$
(556
)

$
47,438Agency residential mortgage-backed securities


197,437



4,377



(187
)


201,627Agency residential collateralized mortgage obligations


226,242



3,588



(1,329
)


228,501SBA pools


6,565



-



(73
)


6,492Total securities

$
478,238


$
7,965


$
(2,145
)

$
484,058     Gross


GrossAmortized


Unrealized


UnrealizedDecember 31, 2010

Cost


Gains


Losses


Fair ValueU.S. government and federal agency

$
9,997


$
168


$
-


$
10,165Agency residential mortgage-backed securities


162,841



5,305



(380
)


167,766Agency residential collateralized mortgage obligations


209,193



1,951



(4,864
)


206,280Municipal bonds


50,488



578



(981
)


50,085Total securities

$
432,519


$
8,002


$
(6,225
)

$
434,296   Gross


GrossAmortized


Unrealized


UnrealizedDecember 31, 2009

Cost


Gains


Losses


Fair ValueU.S. government and federal agency

$
14,991


$
140


$
-


$
15,131Agency residential mortgage-backed securities


154,013



4,555



(175
)


158,393Agency residential collateralized mortgage obligations


56,414



978



(2
)


57,390Municipal bonds


29,306



698



(104
)


29,900Total securities

$
254,724


$
6,371


$
(281
)

$
260,814  93




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 5 
    SECURITIES(Continued)    AvailableHeld to maturity


for saleCarryingAmount


Fair Value


Fair ValueDue in one year or less

$
-


$
-


$
-Due from one to five years


11,650



11,893



-Due from five to ten years


9,586



10,001



5,108Due after ten years


39,249



38,356



-Agency residential mortgage-backed securities


162,841



167,766



354,497Agency residential collateralized mortgage obligations


209,193



206,280



357,892Total

$
432,519


$
434,296


$
717,497         December 31, 2009


December 31, 2008Proceeds

$
73,785


$
-Gross gains


2,377



-Gross losses


-



-Net impairment loss recognized in earnings


(12,246
)


(13,809
)       AFS

Less than 12 Months


12 Months or More


TotalUnrealized








Unrealized








UnrealizedDecember 31, 2010

Fair Value


Loss


Number


Fair Value


Loss


Number


Fair Value


Loss


NumberAgency residential mortgage-backed securities

$
161,854


$
(1,433
)


32


$
-


$
-



-


$
161,854


$
(1,433
)


32Agency residential collateralized mortgage obligations


125,819



(2,372
)


18



32,358



(107
)


11



158,177



(2,479
)


29Total temporarily impaired

$
287,673


$
(3,805
)


50


$
32,358


$
(107
)


11


$
320,031


$
(3,912
)


61   HTM

Less than 12 Months


12 Months or More


TotalUnrealized








Unrealized








UnrealizedDecember 31, 2010

Fair Value


Loss


Number


Fair Value


Loss


Number


Fair Value


Loss


NumberAgency residential mortgage-backed securities

$
28,394


$
(380
)


4


$
-


$
-



-


$
28,394


$
(380
)


4Agency residential collateralized mortgage obligations


137,099



(4,864
)


15



-



-



-



137,099



(4,864
)


15Municipal bonds


30,316



(981
)


72



-



-



-



30,316



(981
)


72Total temporarily impaired

$
195,809


$
(6,225
)


91


$
-


$
-



-


$
195,809


$
(6,225
)


91   94




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 5 
    SECURITIES(Continued)  AFS

Less than 12 Months


12 Months or More


TotalUnrealized








Unrealized








UnrealizedDecember 31, 2009

Fair Value


Loss


Number


Fair Value


Loss


Number


Fair Value


Loss


NumberU.S. government and federal agency

$
47,438


$
(556
)


10


$
-


$
-



-


$
47,438


$
(556
)


10Agency residential mortgage-backed securities


40,651



(187
)


11



-



-



-



40,651



(187
)


11Agency residential collateralized mortgage obligations


3,793



(32
)


1



89,956



(1,297
)


20



93,749



(1,329
)


21SBA pools


-



-



-



6,492



(73
)


2



6,492



(73
)


2Total temporarily impaired

$
91,882


$
(775
)


22


$
96,448


$
(1,370
)


22


$
188,330


$
(2,145
)


44   HTM

Less than 12 Months


12 Months or More


TotalDecember 31, 2009

Fair Value


Unrealized Loss


Number


Fair Value


Unrealized Loss


Number


Fair Value


Unrealized Loss


NumberAgency residential mortgage-backed securities

$
30,231


$
(175
)


7


$
-


$
-



-


$
30,231


$
(175
)


7Agency residential collateralized mortgage obligations


4



-



1



687



(2
)


3



691



(2
)


4Municipal bonds


4,333



(104
)


12



-



-



-



4,333



(104
)


12Total temporarily impaired

$
34,568


$
(279
)


20


$
687


$
(2
)


3


$
35,255


$
(281
)


23   Other-than-Temporary
    Impairment
 other-than-temporary other-than-temporary
  other-than-temporary other-than-temporary other-than-temporary other-than-temporary other-than-temporary other-than-temporary
  other-than-temporary
  other-than-temporary No. 115-2 No. 124-2 ,
    Recognition and Presentation of
    Other-Than-Temporary
    Impairments 320-10), other-than-temporary
 95




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 5 
    SECURITIES(Continued)  other-than-temporary
  other-than-temporary ASC 325-40 ASC 325-40,
    other-than-temporary
     96




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
  NOTE 6 
    LOANS    December 31,


December 31,2010


2009Real estate loans:One- to four-family

$
393,896


$
421,935Commercial real estate


479,071



453,604One- to four-family construction


11,435



6,195Commercial construction


569



879Home equity


115,418



116,138Total real estate loans


1,000,389



998,751Other loans:Automobile indirect loans


1,606



10,711Automobile direct loans


40,944



57,186Government-guaranteed student loans


4,557



5,818Commercial non-mortgage loans


39,279



27,983Consumer lines of credit and unsecured loans


14,197



14,781Other consumer loans, secured


6,062



6,399Total other loans


106,645



122,878Gross loans


1,107,034



1,121,629Deferred net loan origination fees


(73
)


(1,160
)Allowance for loan losses


(14,847
)


(12,310
)Net loans

$
1,092,114


$
1,108,159     Years Ended December 31,2010


2009


2008Beginning balance

$
12,310


$
9,068


$
6,165Provision for loan losses


5,119



7,652



6,171Loans charged-off


(2,994
)


(4,995
)


(4,026
)Recoveries


412



585



758(2,582
)


(4,410
)


(3,268
)Ending balance

$
14,847


$
12,310


$
9,068  97




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 6 
    LOANS(Continued)    December 31, 2010Average


InterestRecorded


Unpaid Principal


Related


Recorded


IncomeInvestment


Balance


Allowance


Investment


RecognizedWith no related allowance recorded:Real estate loans:One- to four- family

$
3,188


$
3,188


$
-


$
3,651


$
107Home equity/home
    improvement(1)


455



455



-



366



16Commercial


1,635



1,635



-



2,710



203Total real estate loans


5,278



5,278



-



6,727



326Commercial non-mortgage


-



-



-



54



8Impaired loans with no related allowance recorded


5,278



5,278



-



6,781



334With an allowance recorded :Real estate loans:One- to four- family


2,893



2,893



474



1,631



59Home equity/home improvement


851



851



95



381



2Commercial


9,295



9,295



1,407



6,432



134Total real estate loans


13,039



13,039



1,976



8,444



195Consumer loans:Automobile indirect


88



88



6



141



-Automobile direct


117



117



10



145



-Other secured


13



13



2



8



-Lines of credit/unsecured


108



108



5



120



-Total consumer loans


326



326



23



414



-Commercial non-mortgage


272



272



8



299



6Impaired loans with allowance recorded


13,637



13,637



2,007



9,157



201Total:Residential real estate


7,387



7,387



569



6,029



184Commercial real estate


10,930



10,930



1,407



9,142



337Consumer


326



326



23



414



-Commercial non-mortgage


272



272



8



353



14$
18,915


$
18,915


$
2,007


$
15,938


$
535    (1)
    For purposes of assessing and monitoring the risk and
    performance of the loan portfolio, home equity and home
    improvement loans are aggregated as a portfolio segment.  December 31, 2009Period-end loans with no allocated allowance for loan losses

$
8,240Period-end loans with allocated allowance for loan losses


4,352Total

$
12,592Amount of the allowance for loan losses allocated to impaired
    loans at period-end

$
738   98




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 6 
    LOANS(Continued)  Years Ended December 31,2009


2008Average of individually impaired loans during the year

$
9,349


$
4,225Interest income recognized during impairment


366



258     Years Ended December 31,2010


2009Loans past due over 90 days still on accrual

$
-


$
-Nonaccrual loans


17,628



11,675Total

$
17,628


$
11,675         Years Ended December 31,2010


2009Real Estate Loans:One- to four- family

$
5,938


$
6,007Commercial


9,812



4,682Home equity/home improvement


1,306



562Total real estate loans


17,056



11,251Consumer Loans:Automobile indirect


84



124Automobile direct


95



136Consumer other secured


13



4Consumer lines of credit/unsecured


108



116Total consumer Loans


300



380Commercial non-mortgage


272



44Total

$
17,628


$
11,675  99




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 6 
    LOANS(Continued)    90 Days and30-59 Days Past


60-89 Days Past


Greater Past


Total LoansDue


Due


Due


Past Due


Current Loans


Total LoansReal estate loans:One- to four- family

$
3,248


$
3,068


$
3,952


$
10,268


$
371,316


$
381,584Commercial


2,869







1,645



4,514



475,126



479,640Home equity/home improvement


1,009



175



1,047



2,231



136,934



139,165Total real estate loans


7,126



3,243



6,644



17,013



983,376



1,000,389Other loans:Consumer loans:Automobile indirect


56



3



78



137



1,469



1,606Automobile direct


193



15



64



272



40,672



40,944Other secured


32







2



34



10,585



10,619Lines of credit/unsecured


84



47



108



239



13,958



14,197Total consumer loans


365



65



252



682



66,684



67,366Commercial non-mortgage


174







52



226



39,053



39,279Total

$
7,665


$
3,308


$
6,948


$
17,921


$
1,089,113


$
1,107,034     and/or
   100




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 6 
    LOANS(Continued)    Real
    Estate and Commercial Non-Mortgage Credit Exposure
 Credit
    Risk Profile by Internally Assigned Grade
  Residential Real


Commercial Real


Commercial Non-


Home Equity/HomeEstate


Estate


Mortgage


ImprovementGrade:Pass

$
374,790


$
466,230


$
38,768


$
137,796Special Mention


713



2,479



239



63Substandard


3,663



10,185



220



337Doubtful


2,418



746



52



969Total

$
381,584


$
479,640


$
39,279


$
139,165   Consumer
    Credit Exposure
 Credit
    Risk Profile Based on Payment Activity
  Lines ofAutomobile Indirect


Automobile Direct


Other Secured


Credit/UnsecuredPerforming

$
1,522


$
40,849


$
10,606


$
14,089Non-performing


84



95



13



108Total

$
1,606


$
40,944


$
10,619


$
14,197   NOTE 7 
    FAIR
    VALUE            The Fair Value Option
    for Financial Assets and Financial Liabilities
 101




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 7 
    FAIR
    VALUE(Continued)    and/or
      Assets
    and Liabilities Measured on a Recurring Basis
    Fair Value Measurements at December 31, 2010, UsingQuoted Prices inActive Markets for


Significant Other


SignificantIdentical Assets


Observable Inputs


UnobservableDecember 31, 2010


(Level 1)


(Level 2)


Inputs (Level 3)Assets:U.S. government and federal agency

$
-


$
-


$
-


$
-Agency residential mortgage-backed securities


354,497



-



354,497



-Agency residential collateralized mortgage obligations


357,892



-



357,892



-SBA pools


5,108



-



5,108



-Total securities available for sale

$
717,497


$
-


$
717,497


$
-Loans held for sale


16,877



-



16,877



-Derivative instruments


116



-



116



-   102




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 7 
    FAIR
    VALUE(Continued)  Fair Value Measurements at December 31, 2009, UsingQuoted Prices inActive Markets for


Significant Other


SignificantIdentical Assets


Observable Inputs


UnobservableDecember 31, 2009


(Level 1)


(Level 2)


Inputs (Level 3)Assets:U.S. government and federal agency

$
47,438


$
-


$
47,438


$
-Agency residential mortgage-backed securities


201,627



-



201,627



-Agency residential collateralized mortgage obligations


228,501



-



228,501



-SBA pools


6,492



-



6,492



-Total securities available for sale

$
484,058


$
-


$
484,058


$
-     Securities availablefor saleBeginning balance, January 1, 2009

$
7,940Adjustment due to adoption of
    ASC 320-10-65,
    non-credit portion of impairment previously recorded


4,351Proceeds from sale of securities


(224
)Total gains or losses (realized /unrealized)Included in earningsInterest income on securities


159Impairment of collateralized debt obligations (all credit)


(12,246
)Gains (losses) on sale of securities


20Included in other comprehensive income


-Ending balance, December 31, 2009

$
-   Assets and Liabilities Measured on a Non-Recurring Basis
    Fair Value Measurements at December 31, 2010, UsingQuoted Prices inActive Markets for


Significant Other


SignificantIdentical Assets


Observable Inputs


UnobservableDecember 31, 2010


(Level 1)


(Level 2)


Inputs (Level 3)Assets:Impaired loans

$
11,630


$
-


$
-


$
11,630Other real estate owned


2,668



-



2,219



449   103




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 7 
    FAIR
    VALUE(Continued)  Fair Value Measurements at December 31, 2009, UsingQuoted Prices inActive Markets for


Significant Other


SignificantIdentical Assets


Observable Inputs


UnobservableDecember 31, 2009


(Level 1)


(Level 2)


Inputs (Level 3)Assets:Impaired loans

$
3,614


$
-


$
-


$
3,614Other real estate owned


3,917



-



3,517



400           2010


2009Balance at January 1

$
3,917


$
1,561Transfers in at fair value


3,506



4,487Change in valuation allowance


(416
)


181Sale of property (gross)


(4,339
)


(2,312
)Balance at December 31

$
2,668


$
3,917Valuation allowance:Balance at January 1

$
37


$
218Sale of property


(87
)


(369
)Valuation adjustment


502



188Balance at December 31

$
452


$
37  104




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 7 
    FAIR
    VALUE(Continued)    December 31, 2010


December 31, 2009Carrying Amount


Fair Value


Carrying Amount


Fair ValueFinancial assetsCash and cash equivalents

$
68,650


$
68,650


$
55,470


$
55,470Securities available for sale


717,497



717,497



484,058



484,058Securities held to maturity


432,519



434,296



254,724



260,814Loans held for sale


491,985



492,367



341,431



342,663Loans, net


1,092,114



1,107,640



1,108,159



1,105,979FHLB stock


20,569



N/A



14,147



N/ABank-owned life insurance


28,501



28,501



28,117



28,117Accrued interest receivable


9,248



9,248



8,099



8,099Derivative instruments


116



116



-



-Financial liabilitiesDeposits

$
(2,017,550
)

$
(2,087,160
)

$
(1,796,665
)

$
(1,771,080
)FHLB advances


(461,219
)


(470,729
)


(312,504
)


(319,052
)Repurchase agreement


(25,000
)


(27,255
)


(25,000
)


(25,277
)Other borrowings


(10,000
)


(10,000
)


(10,000
)


(10,000
)Accrued interest payable


(1,541
)


(1,541
)


(1,884
)


(1,884
)       NOTE 8 
    DERIVATIVE
    FINANCIAL INSTRUMENTS  The Fair Value
    Option for Financial Assets and Financial Liabilities Fair Value Measurements and
    Disclosures
   105




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 8 
    DERIVATIVE
    FINANCIAL
    INSTRUMENTS(Continued)      OutstandingExpiration


Notional





RecordedDecember 31, 2010

Dates


Balance


Fair Value


Gains/(Losses)Other AssetsIRLCs


2011


$
16,082


$
11


$
11Loan sale commitments


2011



10,207



(79
)


1,367Forward mortgage-backed securities trades


2011



23,102



105



(1,176
)   NOTE 9 
    LOAN
    SALES AND SERVICING    2010


2009Balance at January 1

$
341,431


$
159,884Loans originated for sale


7,877,505



5,742,599Proceeds from sale of loans held for sale


(7,739,992
)


(5,577,643
)Net gain on sale of loans held for sale


13,041



16,591Loans held for sale, net at December 31

$
491,985


$
341,431     2010


2009


2008Serviced loans

$
110,691


$
145,762


$
178,611Subserviced loans


164,648



249,709



256,403Total mortgage loans serviced for others

$
275,339


$
395,471


$
435,014      106




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 9 
    LOAN
    SALES AND
    SERVICING(Continued)    2010


2009Balance at January 1

$
872


$
1,372Amortized to expense


(251
)


(309
)Change in valuation allowance


15



(191
)Balance at December 31

$
636


$
872Valuation allowance:Balance at January 1

$
191


$
-Additions expensed


-



300Valuation adjustment


(15
)


(109
)Balance at December 31

$
176


$
191         2011

$
2002012


1522013


1152014


872015


65   NOTE 10 
    ACCRUED
    INTEREST RECEIVABLE AND ACCRUED INTEREST PAYABLE    Accrued Interest Receivable:

December 31, 2010


December 31, 2009Loans

$
5,324


$
5,217Securities and overnight funds


3,924



2,882Total

$
9,248


$
8,099Accrued Interest Payable:Time deposits

$
483


$
491Borrowings


1,055



1,390Other liabilities


3



3Total

$
1,541


$
1,884   107




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
  NOTE 11 
    PREMISES
    AND EQUIPMENT    December 31, 2010


December 31, 2009Land

$
17,197


$
17,197Buildings


42,922



42,911Furniture, fixtures and equipment


36,209



35,398Leasehold improvements


2,133



2,22798,461



97,733Less: accumulated depreciation


(49,730
)


(47,293
)Total

$
48,731


$
50,440     Operating Leases
    2011


1,0792012


9252013


6672014


3642015


360Thereafter


2,851Total

$
6,246     NOTE 12 
    DEPOSITS    ® ® ® ®
 108




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 12 
    DEPOSITS(Continued)    WeightedAverageBalance


Rate2011


480,928



1.45
%2012


112,694



2.092013


51,491



4.032014


14,410



4.222015


5,399



2.20Total

$
664,922



1.83
%       Years EndedDecember 31,2010


2009


2008Interest bearing demand

$
8,976


$
3,350


$
868Savings and money market


9,102



12,007



14,442Time


12,937



19,009



20,219Total

$
31,015


$
34,366


$
35,529   NOTE 13 
    REPURCHASE
    AGREEMENT    2010


2009


2008Average balance during the year

$
32,328


$
31,967


$
37,366Average interest rate during the year


1.87
%


2.18
%


3.90
%Maximum month-end balance during the year

$
34,053


$
33,747


$
39,835Weighted average interest rate at year-end


2.17
%


1.69
%


3.05
%   NOTE 14 
    BORROWINGS
  Federal Home Loan Bank Advances
  109




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 14 
    BORROWINGS (Continued)
            WeightedAverageBalance


Rate2011


218,357



0.49
%2012


36,720



2.222013


17,134



4.472014


36,517



2.862015


61,742



3.66Thereafter


96,008



3.27466,478



1.95
%Restructuring prepayment penalty


(5,259
)Total

$
461,219   Other Borrowings
   2-year
 110




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 14 
    BORROWINGS (Continued)
  and/or
  NOTE 15 
    BENEFITS  Post-Retirement Healthcare Plan
    401(k) Plan
    Deferred Compensation Plan
   111




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 15 
    BENEFITS(Continued)    Bank-Owned Life Insurance
      Directors Agreements
  NOTE 16 
    ESOP
    PLAN       112




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 16 
    ESOP
    PLAN(Continued)    2010


2009Allocated to participants


601,912



444,847Unearned


2,286,428



854,906Total ESOP shares


2,888,340



1,299,753Fair value of unearned shares at December 31

$
26,728


$
8,799   NOTE 17 
    SHARE-BASED
    COMPENSATION  Compensation  Stock
    Compensation
          Weighted-AverageGrant DateShares


Fair ValueNon-vested at January 1, 2010


364,161


$
13.15Granted






Vested


(120,459
)


13.16Forfeited


(25,309
)


13.19Non-vested at December 31, 2010


218,393


$
13.14  113




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 17 
    SHARE-BASED
    COMPENSATION(Continued)            2010


2009


2008Risk-free interest rate


2.60%



2.69%



3.45%Expected term of stock options (years)


7.5



7.5



7.5Expected stock price volatility


35.80%



37.00%



26.19%Expected dividends


1.29%



1.53%



1.84%  114




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 17 
    SHARE-BASED
    COMPENSATION(Continued)    Weighted-Weighted-


AverageAverage


Remaining


AggregateExercise


Contractual


IntrinsicOptions

Shares


Price


Term


ValueOutstanding at January 1, 2010


366,376


$
12.25



8.1


$
114Granted


117,072



11.08



10.0



71Exercised














Forfeited


(25,893
)


11.30







15Outstanding at December 31, 2010


457,555


$
12.01



7.6


$
170Fully vested and expected to vest


414,050


$
12.15



7.5


$
146Exercisable at December 31, 2010


62,059


$
12.93



6.6


$
7       NOTE 18 
    INCOME
    TAXES      2010


2009


2008Current expense (benefit)

$
9,426


$
(2,991
)

$
3,027Deferred expense (benefit)


(794
)


3,951



(5,304
)Total income tax expense (benefit)

$
8,632


$
960


$
(2,277
)  115




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 18 
    INCOME
    TAXES(Continued)    December 31, 2010


December 31, 2009Deferred tax assets:Allowance for loan losses

$
5,295


$
4,266Other real estate owned


161



376Depreciation


1,497



1,549Deferred compensation arrangements


763



599Self-funded health insurance


110



88Non-accrual interest


173



162Restricted stock and stock options


638



426Other


336



1128,973



7,578Deferred tax liabilities:Mortgage servicing assets


(227
)


(302
)Net unrealized gain on securities available for sale


(1,315
)


(2,017
)Partnership  Lone Star New Markets Fund


(774
)


Other


(77
)


(175
)(2,393
)


(2,494
)Net deferred tax asset

$
6,580


$
5,084       2010


2009


2008Federal statutory rate times financial statement income

$
9,251


$
1,234


$
(1,901)Effect of:State taxes, net of federal benefit


29



98



72New market tax credit


(119)



(113)



(106)Bank-owned life insurance income


(134)



(183)



(368)Municipal interest income


(535)



(156)



(37)Other


140



80



63Total income tax expense (benefit)

$
8,632


$
960


$
(2,277)Effective Tax Rate


32.66%



26.45%



(40.72)%   116




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
  NOTE 19 
    RELATED
    PARTY TRANSACTIONS    Beginning balance

$
1,584New loans


614Effect of changes in composition of related parties


Repayments


(722
)Ending balance

$
1,476     NOTE 20 
    REGULATORY
    CAPITAL MATTERS     117




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 20 
    REGULATORY
    CAPITAL MATTERS(Continued)    Required for Capital


To Be Well-Capitalized Under Prompt CorrectiveActual


Adequacy Purposes


Action RegulationsAmount


Ratio


Amount


Ratio


Amount


Ratio(Dollars in Thousands)As of December 31,
    2010:Total capital (to risk-weighted assets)

$
298,739



18.42
%

$
129,717



8.00
%

$
162,147



10.00
%Tier 1 (core) capital (to risk-weighted assets)


285,494



17.61
%


64,859



4.00
%


97,288



6.00
%Tier 1 (core) capital (to adjusted total assets)


285,494



9.73
%


117,320



4.00
%


146,650



5.00
%As of December 31,
    2009:Total capital (to risk-weighted assets)

$
201,250



15.27
%

$
105,450



8.00
%

$
131,812



10.00
%Tier 1 (core) capital (to risk-weighted assets)


189,678



14.39
%


52,725



4.00
%


79,087



6.00
%Tier 1 (core) capital (to adjusted total assets)


189,678



7.99
%


94,900



4.00
%


118,626



5.00
%     December 31,2010


2009GAAP equity

$
292,870


$
194,491Investment in nonincludable subsidiary


(4,092
)


Disallowed servicing and deferred tax assets


(64
)


(88
)Unrealized loss (gain) on securities available for sale


(2,373
)


(3,802
)Goodwill and other assets


(847
)


(923
)Tier 1 capital


285,494



189,678General allowance for loan losses


13,245



11,572Total capital

$
298,739


$
201,250      118




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 20 
    REGULATORY
    CAPITAL MATTERS(Continued)      Dividend Restrictions and Information year-to-date
  NOTE 21 
    LOAN
    COMMITMENTS, CONTINGENT LIABILITIES AND OTHER RELATED
    ACTIVITIES      2010


2009Fixed Rate


Variable Rate


Fixed Rate


Variable RateCommitments to make loans

$
85,387


$
21,277


$
60,263


$
24,396Unused lines of credit


6,136



73,034



6,347



73,403Unused commitment on Warehouse Purchase Program loans






289,088







198,626Total

$
91,523


$
383,399


$
66,610


$
296,425        119




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 21 
    LOAN COMMITMENTS, CONTINGENT LIABILITIES AND OTHER RELATED
    ACTIVITIES (Continued)
  Liability
    for Mortgage Loan Repurchase Losses
          NOTE 22 
    GOODWILL   120




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
  NOTE 23 
    SEGMENT
    INFORMATION    Year EndedDecember 31, 2010TotalEliminations


Segmentsand


(ConsolidatedResults of Operations:

Banking


VPM


Adjustments(1)


Total)Total interest income

$
115,069


$
2,277


$
(1,961
)

$
115,385Total interest expense


44,156



1,961



(1,964
)


44,153Provision for loan losses


5,054



65







5,119Net interest income after provision for loan losses


65,859



251



3



66,113Other revenue


20,796



(38
)


(335
)


20,423Net gain (loss) on sale of loans


(2,061
)


15,102







13,041Total non-interest expense


57,430



14,990



726



73,146Income before income tax expense (benefit)


27,164



325



(1,058
)


26,431Income tax expense (benefit)


8,752



70



(190
)


8,632Net income

$
18,412


$
255


$
(868
)

$
17,799Segment assets

$
2,943,794


$
51,382


$
(53,181
)

$
2,941,995Noncash items:Net gain (loss) on sale of loans


(2,061
)


15,102







13,041Depreciation


3,272



299







3,571Provision for loan losses


5,054



65







5,119   121




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 23 
    SEGMENT
    INFORMATION(Continued)  Year EndedDecember 31, 2009TotalEliminations


Segmentsand


(ConsolidatedResults of Operations:

Banking


VPM


Adjustments1


Total)Total interest income

$
108,413


$
1,932


$
(2,439
)

$
107,906Total interest expense


49,550



1,583



(1,847
)


49,286Provision for loan losses


7,652











7,652Net interest income after provision for loan losses


51,211



349



(592
)


50,968Other revenue


22,967



(4
)


(109
)


22,854Net gain (loss) on sale of loans


(1,024
)


17,615







16,591Impairment of collateralized debt obligations (all credit)


(12,246
)










(12,246
)Total non-interest expense


57,641



16,664



232



74,537Income before income tax expense (benefit)


3,267



1,296



(933
)


3,630Income tax expense (benefit)


541



440



(21
)


960Net income

$
2,726


$
856


$
(912
)

$
2,670Segment assets

$
2,380,938


$
41,391


$
(42,825
)

$
2,379,504Noncash items:Net gain (loss) on sale of loans


(1,024
)


17,615







16,591Depreciation


3,554



230







3,784Provision for loan losses


7,652











7,652   Year EndedDecember 31, 2008TotalEliminations


Segmentsand


(ConsolidatedResults of Operations:

Banking


VPM


Adjustments1


Total)Total interest income

$
96,488


$
1,272


$
(965
)

$
96,795Total interest expense


46,604



603



(1,038
)


46,169Provision for loan losses


6,171











6,171Net interest income after provision for loan losses


43,713



669



73



44,455Other revenue


23,359



(3
)


(73
)


23,283Net gain (loss) on sale of loans


61



13,138



(3,809
)


9,390Impairment of collateralized debt obligations (all credit)


(13,809
)










(13,809
)Total non-interest expense


59,281



13,168



(3,538
)


68,911Income before income tax expense (benefit)


(5,957
)


636



(271
)


(5,592
)Income tax expense (benefit)


(2,582
)


274



31



(2,277
)Net income

$
(3,375
)

$
362


$
(302
)

$
(3,315
)Segment assets

$
2,214,463


$
26,831


$
(27,879
)

$
2,213,415Noncash items:Net gain (loss) on sale of loans


61



13,138



(3,809
)


9,390Depreciation


4,184



181







4,365Provision for loan losses


6,171











6,171     (1)
 122




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
  NOTE 24 
    PARENT
    COMPANY ONLY CONDENSED FINANCIAL INFORMATION    CONDENSED
    BALANCE SHEETS
    December 31,
  2010


2009ASSETSCash on deposit at subsidiary

$
90,570


$
8,331Investment in banking subsidiary


292,870



194,491Receivable from banking subsidiary


1,531



6,255ESOP note receivable and other assets


21,743



6,732Total assets

$
406,714


$
215,809LIABILITIES AND SHAREHOLDERS EQUITYBorrowings  Note 14

$
10,000


$
10,000Income tax payable






Other liabilities


125



127Shareholders equity


396,589



205,682Total liabilities and shareholders equity

$
406,714


$
215,809   CONDENSED
    STATEMENTS OF INCOME (LOSS)
    Years ended December 31,
  2010


2009


2008Interest income on ESOP loan

$
602


$
391


$
435Other income










Interest expense


600



127



Operating expenses


806



341



344Income (loss) before income tax expense and equity in
    undistributed earnings (loss) of subsidiary


(804
)


(77
)


91Income tax expense (benefit)


(190
)


(21
)


31Equity in undistributed earnings (loss) of subsidiary


18,413



2,726



(3,375
)Net income (loss)

$
17,799


$
2,670


$
(3,315
)  123




---



##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
   NOTE 24 
    PARENT
    COMPANY ONLY CONDENSED FINANCIAL INFORMATION(Continued)  CONDENSED
    STATEMENTS OF CASH FLOWS
    Years ended December 31,
  2010


2009


2008Cash flows from operating activitiesNet income (loss)

$
17,799


$
2,670


$
(3,315
)Adjustments to reconcile net income (loss) to net cash from
    operating activities:Equity in undistributed (earnings) loss of subsidiary


(18,413
)


(2,726
)


3,375Vesting of restricted stock


1,455



1,501



1,601Net change in intercompany receivable


5,000



(5,000
)


Net change in other assets


(79
)


(137
)


(25
)Net change in other liabilities


(2
)


79



(187
)Net cash from operating activities


5,760



(3,613
)


1,449Cash flows from investing activitiesContribution of 50% of proceeds of stock offering to subsidiary


(95,400
)






Fund ESOP note receivable from Conversion and stock offering


(15,886
)






Capital contributuion to subsidiary






(19,500
)Payments received on ESOP notes receivable


1,026



828



968Additional principal payments received on ESOP notes receivable






184



Net cash from investing activities


(110,260
)


(18,488
)


968Cash flows from financing activitiesNet proceeds from stock offering


190,801







Merger of ViewPoint MHC pursuant to reorganization


207







Proceeds from borrowing






10,000



Treasury stock purchased


(407
)






(4,312
)Payment of dividends


(3,862
)


(2,472
)


(3,154
)Net cash from financing activities


186,739



7,528



(7,466
)Net change in cash and cash equivalents


82,239



(14,573
)


(5,049
)Beginning cash and cash equivalents


8,331



22,904



27,953Ending cash and cash equivalents

$
90,570


$
8,331


$
22,904   124




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##### Table of Contents



VIEWPOINT
    FINANCIAL GROUP, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollar amounts in thousands, except per share and share data)
  NOTE 25 
    QUARTERLY
    FINANCIAL DATA(Unaudited)  ProvisionInterest





Interest


Net Interest





for Loan


Net Income





Earnings (Loss) per ShareIncome





Expense


Income





Losses


(Loss)





Basic





Diluted2010First quarter

$
26,209



(2
)

$
11,117


$
15,092



(2
)

$
1,146


$
2,705






$
0.10



(3
)

$
0.10



(3
)Second quarter


27,718



(2
)


11,265



16,453



(2
)


1,888



3,196







0.11



(3
)


0.11



(3
)Third quarter


30,101







11,582



18,519







756



5,408







0.17







0.17Fourth quarter


31,357







10,189



21,168







1,329



6,490







0.20







0.202009First quarter

$
27,420



(2
)

$
13,051


$
14,369



(2
)

$
1,442


$
1,244






$
0.04



(3
)

$
0.04



(3
)Second quarter


27,173



(2
)


12,494



14,679



(2
)


1,494



(3,831
)


(1
)


(0.14
)


(1
),(3)


(0.14
)


(1
),(3)Third quarter


26,287



(2
)


12,172



14,115



(2
)


1,775



2,893







0.10



(3
)


0.10



(3
)Fourth quarter


27,026



(2
)


11,569



15,457



(2
)


2,941



2,364







0.08



(3
)


0.08



(3
)    (1)
    During the second quarter of 2009,
    the Company recognized a $12,246 non-cash, pre-tax charge for
    the
    other-than-temporary
    impairment of collateralized debt obligations. This impairment
    charge was partially offset by the sale of 22 agency residential
    collateralized mortgage obligations and two agency residential
    mortgage-backed securities, which resulted in a $2,377 pre-tax
    gain during the second quarter of 2009.(2)
    In the third quarter of 2010, the
    Company reclassified a portion of interest income associated
    with mortgage loans held for sale to lending expense. The impact
    of this classification was $41 for the first two quarters of
    2010 and $395 for the year ended December 31, 2009.(3)
    All share and per share information
    for periods prior to the Conversion has been adjusted to reflect
    the 1.4:1 exchange ratio on publicly traded shares, which
    resulted in a 4,287,752 increase in outstanding shares.  NOTE 26-
    SUBSEQUENT EVENTS
  available-for-sale
 125




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Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  (a)
    Evaluation of Disclosure Controls and Procedures: An
    evaluation of our disclosure controls and procedures (as defined
    in
    Rule 13a-15(e)
    under the Securities Exchange Act of 1934 (the Act))
    was carried out as of December 31, 2010, under the
    supervision and with the participation of our Chief Executive
    Officer, Chief Financial Officer and several other members of
    our senior management. Our Chief Executive Officer and Chief
    Financial Officer concluded that, as of December 31, 2010,
    our disclosure controls and procedures were effective in
    ensuring that the information we are required to disclose in the
    reports we file or submit under the Act is (i) accumulated
    and communicated to our management (including the Chief
    Executive Officer and Chief Financial Officer) in a timely
    manner, and (ii) recorded, processed, summarized and
    reported within the time periods specified in the SECs
    rules and forms.  (b)
    Managements Report on Internal Control Over Financial
    Reporting: Management of the Company is responsible for
    establishing and maintaining an effective system of internal
    control over financial reporting. The Companys system of
    internal control over financial reporting is designed to provide
    reasonable assurance regarding the reliability of financial
    reporting and the preparation of financial statements for
    external purposes in accordance with generally accepted
    accounting principles. There are inherent limitations in the
    effectiveness of any system of internal control over financial
    reporting, including the possibility of human error and
    circumvention or overriding of controls. Accordingly, even an
    effective system of internal control over financial reporting
    can provide only reasonable assurance with respect to financial
    statement preparation. Projections of any evaluation of
    effectiveness to future periods are subject to the risks that
    controls may become inadequate because of changes in conditions
    or that the degree of compliance with the policies or procedures
    may deteriorate.Management assessed the Companys systems of internal
    control over financial reporting as of December 31, 2010.
    This assessment was based on criteria for effective internal
    control over financial reporting described in Internal
    Control  Integrated Framework issued by the Committee
    of Sponsoring Organizations of the Treadway Commission. Based on
    this assessment, management believes that, as of
    December 31, 2010, the Company maintained effective
    internal control over financial reporting based on those
    criteria. The Companys independent registered public
    accounting firm that audited the financial statements included
    in this annual report on
    Form 10-K
    has issued an attestation report on the Companys internal
    control over financial reporting. The attestation report of
    Ernst & Young LLP appears below.  Report of
    Ernst & Young LLP
 Independent
    Registered Public Accounting Firm
        126




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(c)
    Changes in Internal Control Over Financial Reporting:
    During the quarter ended December 31, 2010, no change
    occurred in our internal control over financial reporting that
    has materially affected, or is reasonably likely to materially
    affect, our internal control over financial reporting.  Item 9B.
    Other
    Information   127




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PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance  Directors and Executive Officers. Form 10-K,
  Section 16(a) Beneficial Ownership Reporting
    Compliance.
  Code of Ethics. www.viewpointbank.com.
  Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Shareholder Matters  Form 10-K
  Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence    Item 14.
    Principal
    Accountant Fees and Services   128




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##### Table of Contents



PART IV  Item 15.
    Exhibits,
    Financial Statement Schedules  (a)(1)

Financial Statements: See Part II  Item 8.
    Financial Statements and Supplementary Data.(a)(2)

Financial Statement Schedules: All financial statement schedules
    have been omitted as the information is included in the notes to
    the consolidated financial statements or is not required under
    the related instructions or is not applicable.(a)(3)

Exhibits: See below.(b)

Exhibits:   ExhibitNumber

Description2
.1

Amended and Restated Plan of Conversion and Reorganization of
    ViewPoint MHC (incorporated herein by reference to
    Exhibit 2.1 to the Registrants Annual Report on
    Form 10-K
    filed with the SEC on March 4, 2010 (File
    No. 001-32992))3
.1

Charter of the Registrant (incorporated herein by reference to
    Exhibit 3.1 to the Registrants Registration Statement
    on
    Form S-1,
    as amended (File
    No. 333-165509))3
.2

Bylaws of the Registrant (incorporated herein by reference to
    Exhibit 3.2 to the Registrants Registration Statement
    on
    Form S-1
    (File
    No. 333-165509))4
.0

Certificate of Registrants Common Stock (incorporated
    herein by reference to Exhibit 4.0 to the Registrants
    Registration Statement on
    Form S-1,
    as amended (File
    No. 333-165509))10
.1

Employment Agreement by and between the Registrant and Garold R.
    Base (incorporated herein by reference to Exhibit 10.1 to
    the Registrants Current Report on
    Form 8-K
    filed with the SEC on October 4, 2006 (File
    No. 001-32992))10
.2

Amendment to Employment Agreement by and between the Registrant
    and Garold R. Base (incorporated herein by reference to
    Exhibit 10.1 to the Registrants Current Report on
    Form 8-K
    filed with the SEC on January 10, 2008 (File
    No. 001-32992))10
.3

Employment Agreement by and between ViewPoint Bank, the
    Registrants wholly owned operating subsidiary, and Garold
    R. Base (incorporated herein by reference to Exhibit 10.2
    to the Registrants Current Report on
    Form 8-K
    filed with the SEC on October 4, 2006 (File
    No. 001-32992))10
.4

Amendment to Employment Agreement by and between ViewPoint Bank,
    the Registrants wholly owned operating subsidiary, and
    Garold R. Base (incorporated herein by reference to
    Exhibit 10.2 to the Registrants Current Report on
    Form 8-K
    filed with the SEC on January 10, 2008 (File
    No. 001-32992))10
.5

Amendment to Employment Agreement by and between ViewPoint Bank,
    the Registrants wholly owned operating subsidiary, and
    Garold R. Base (incorporated herein by reference to
    Exhibit 10.1 to the Registrants Current Report on
    Form 8-K
    filed with the SEC on March 6, 2008 (File
    No. 001-32992))10
.6

Form of Severance Agreement between ViewPoint Bank and the
    following executive officers: Pathie E. McKee, Mark E. Hord,
    James C. Parks and Mark L. Williamson (incorporated herein by
    reference to Exhibit 10.1 to the Registrants Current
    Report on
    Form 8-K
    filed with the SEC on February 17, 2011 (File
    No. 001-34737))10
.7

Summary of Director Board Fee Arrangements (incorporated herein
    by reference to Exhibit 3.2 to the Registrants
    Quarterly Report on
    Form 10-Q
    filed with the SEC on August 9, 2007 (File
    No. 001-32992))10
.8

ViewPoint Bank Deferred Compensation Plan (incorporated herein
    by reference to Exhibit 10.7 to the Registrants
    Registration Statement on
    Form S-1,
    as amended (File
    No. 0-24566-01))10
.9

Amended and Restated ViewPoint Bank Supplemental Executive
    Retirement Plan (incorporated herein by reference to
    Exhibit 10.8 to the Registrants Registration
    Statement on
    Form S-1,
    as amended (File
    No. 0-24566-01))10
.10

Executive Officer Incentive Plan (incorporated herein by
    reference to Exhibit 10.1 to the Registrants Current
    Report on
    Form 8-K
    filed with the SEC on January 26, 2011 (File
    No. 001-34737))10
.11

Form of promissory note between ViewPoint Financial Group and
    four lenders, totaling $10 million (incorporated herein by
    reference to Exhibit 10.1 to the Registrants Current
    Report on
    Form 8-K
    filed with the SEC on October 22, 2009 (File
    No. 001-32992)) 129




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##### Table of Contents



ExhibitNumber

Description11


Statement regarding computation of per share earnings (See
    Note 3 of the Notes to Consolidated Financial Statements
    included in this
    Form 10-K).21


Subsidiaries of the Registrant23
.1

Consent of Independent Registered Public Accounting Firm23
.2

Consent of Independent Registered Public Accounting Firm24


Power of Attorney (on signature page)31
.1

Rule 13a  14(a)/15d  14(a)
    Certification (Chief Executive Officer)31
.2

Rule 13a  14(a)/15d  14(a)
    Certification (Chief Financial Officer)32


Section 1350 Certifications  130




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##### Table of Contents



SIGNATURES  Pursuant to the requirements of Section 13 or 15
    (d) of the Securities Exchange Act of 1934, the registrant
    has duly caused this report to be signed on its behalf by the
    undersigned hereunto duly authorized.
  
  Date: March 1, 2011

By: /s/ Garold R. BaseGarold R. BasePresident and Chief
    Executive Officer
    (Principal Executive Officer)   his/her Form 10-K
  Pursuant to the requirements of the Securities Exchange Act
    of 1934, this report has been signed below by the following
    persons on behalf of the Registrant and in the capacities and on
    the dates indicated.
  /s/  Garold
    R. BaseGarold
    R. Base, President,  Chief Executive Officer and Director(Duly authorized representative and Principal
    Executive Officer)

Date:     March 1, 2011/s/  Gary
    D. BashamGary
    D. Basham, Vice Chairman of the Board and Director

Date:     March 1, 2011/s/  Jack
    D. ErsmanJack
    D. Ersman, Director

Date:     March 1, 2011/s/  Anthony
    J. LeVecchioAnthony
    J. LeVecchio, Director

Date:     March 1, 2011/s/  Karen
    H. OSheaKaren
    H. OShea, Director

Date:     March 1, 2011/s/  Pathie
    E. McKeePathie
    E. McKee, Executive Vice President, Chief Financial Officer
      and Treasurer  (Principal Financial and
    Accounting Officer)

Date:     March 1, 2011  131




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EXHIBIT INDEX
  Exhibits:
  21


Subsidiaries of the Registrant23
.1

Consent of Accountants23
.2

Consent of Accountants31
.1

Certification of the Chief Executive Officer31
.2

Certification of the Chief Financial Officer32


Section 1350 Certifications  132