----

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|   | UNITED      STATES                                            |
|--------|---------------------------------------------------------------|
|   | SECURITIES      AND EXCHANGE      COMMISSION                  |
|   |  WASHINGTON,      D.C. 20549                             |
|   |                                                          |
|   |  FORM      10-K                                          |
|   |                                                          |
| T      | ANNUAL      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE     |
|   | SECURITIES      EXCHANGE ACT OF 1934                          |
|   |                                                          |
|   | For      the fiscal year ended December 31, 2007              |
|   |                                                          |
|   | OR                                                            |
|   |                                                          |
| £ | TRANSITION      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE |
|   | SECURITIES      EXCHANGE ACT OF 1934                          |

| MICHIGAN                                      |   | 38-2761672                  |
|-----------------------------------------------|--------|-----------------------------|
| (State      or other jurisdiction of          |   | (IRS      Employer          |
| incorporation      or organization)           |   | Identification      Number) |
| Capitol      Bancorp Center                   |   |                        |
| 200      Washington Square North              |   |                        |
| Lansing,      Michigan                        |   | 48933                       |
| (Address      of principal executive offices) |   | (Zip      Code)             |

| Title      of each class                                                     |   | Name      of each exchange on which registered |
|------------------------------------------------------------------------------|--------|------------------------------------------------|
| Common      Stock, no par value per share                                    |   | New      York Stock Exchange                   |
| 8.50%      Cumulative Trust Preferred Securities,$10      Liquidation Amount |   |  New      York Stock Exchange             |

No  x

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| Large      accelerated filer  o |   | Accelerated      filer  x |   | Non-accelerated      filer  o |   | Smaller      Reporting Company  o |
|--------------------------------------|--------|--------------------------------|--------|------------------------------------|--------|----------------------------------------|

| Class                                     |   | Outstanding      at February 25, 2008 |
|-------------------------------------------|--------|---------------------------------------|
| Common      Stock, no par value per share |   | 17,319,178      shares                |

| Document                                                                                                                                                   |   | Parts      Into Which Incorporated |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------|
| Annual Report to Shareholders for      the Year Ended     December 31, 2007 (Annual      Report)                                  |   | Parts I, II, and      IV           |
| Portions of Proxy Statement for the Annual      Meeting of     Shareholders to be held      April 23,      2008 (Proxy      Statement) |   | Part III                           |

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| Item of Form      10-KPart      I                                                                                                                  | Incorporation by      Reference From:                                                                                                |
|----------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------|
| Item      1.  Business                                                                                                                   | Pages      F-7 – F-11, F-21 – F-28, F-39 – F-42 and F-56, FinancialInformation      Section of Annual Report  |
| Item      1A.  Risk Factors                                                                                                              | Page      F-30, Financial Information Section of Annual Report                                                                  |
| Item      2.  Properties                                                                                                                 | Pages      F-39 – F-40 and F-54, Financial Information Section of AnnualReport                                            |
| Part      II                                                                                                                                       |                                                                                                                                 |
| Item      5.  Market for Registrant's Common Equity,Related      Stockholder Matters and IssuerPurchases      of Equity Securities  | Pages      F-2 – F-6, F-56 – F-58 and F-64 – F-65 , FinancialInformationSection      of Annual Report              |
| Item      6.  Selected Financial Data                                                                                                    | Page      F-2, Financial Information Section of Annual Report                                                                   |
| Item      7.  Management's Discussion and Analysis ofFinancial      Condition and Results ofOperations                              | Pages      F-7 – F-30, Financial Information Section of Annual Report                                                     |
| Item      7A. Quantitative and Qualitative DisclosuresAbout      Market Risk                                                                       | Pages      F-6 and F-25 – F-28, Financial Information Section ofAnnual      Report                                        |
| Item      8.  Financial Statements and SupplementaryData                                                                                 | Pages      F-2 and F-34 – F-68, Financial Information Section ofAnnual      Report                                        |
| Item      9A. Controls and Procedures                                                                                                              | Pages      F-31 – F-33, Financial Information Section of Annual Report                                                    |
| Part      III                                                                                                                                      |                                                                                                                                 |
| Item      10. Directors, Executive Officers and CorporateGovernance                                                                           | Proxy      Statement                                                                                                                 |
| Item      11. Executive Compensation                                                                                                               | Proxy      Statement                                                                                                            |
| Item      12. Security Ownership of Certain BeneficialOwners      and Management and RelatedStockholder      Matters                          | Proxy      Statement                                                                                                                 |
| Item      13. Certain Relationships and RelatedTransactions      and Director Independence                                                    | Proxy      Statement                                                                                                                 |
| Item      14. Principal Accountant Fees and Services                                                                                          | Proxy      Statement                                                                                                            |
| Part      IV                                                                                                                                       |                                                                                                                                 |
| Item      15. Exhibits and Financial Statement Schedules                                                                                           | Pages      F-31 – F-68, Financial Information Section of Annual  Report                                                        |

| "Annual      Report" | means      the 2007 Annual Report of Capitol provided to Shareholders and the      Commission pursuant to Rule 14a-3(b).  Capitol's 2007 Annual      Report is divided into two sections:  a Financial Information      Section and a Marketing Section and is filed as Exhibit 13 with this Form      10-K report. |
|----------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| "Proxy      Statement" | means      the Proxy Statement of Capitol for the Annual Meeting of Shareholders to      be held April 23, 2008. |
|------------------------|------------------------------------------------------------------------------------------------------------------|

| Note: | The      page number references herein are based on the paper version of the      referenced documents.  Accordingly, those page number references      may differ from the electronically filed versions of those      documents. |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| CAPITOL      BANCORP LTD. |
|---------------------------|

|  PART      I                                                                                                                                         | Page           |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------|
| ITEM  1.   Business                                                                                                                   |  6   |
| ITEM      1A.  Risk Factors                                                                                                                          | 22        |
| ITEM      1B.  Unresolved Staff Comments                                                                                                             | 28        |
| ITEM  2.   Properties                                                                                                                 | 28        |
| ITEM  3.   Legal      Proceedings                                                                                                     | 29        |
| ITEM  4.   Submission      of Matters to a Vote of Security Holders                                                                   | 29        |
| PART      II                                                                                                                                              |           |
| ITEM  5.   Market      for Registrant's Common Equity, Related Stockholder Matters and Issuer      Purchasesof      Equity Securities |  30  |
| ITEM      6.   Selected Financial Data                                                                                                          | 31        |
| ITEM  7.   Management's      Discussion and Analysis of Financial Condition and Results of      Operations                            | 31        |
| ITEM      7A. Quantitative and Qualitative Disclosures About Market    Risk                                                                                    | 31        |
| ITEM  8.   Financial      Statements and Supplementary Data                                                                           | 31        |
| ITEM  9.   Changes      in and Disagreements with Accountants on Accounting and Financial      Disclosure                             | 31        |
| ITEM      9A. Controls and Procedures                                                                                                                          | 31        |
| ITEM      9B. Other Information                                                                                                                                | 32        |
| PART      III                                                                                                                                             |           |
| ITEM      10.  Directors, Executive Officers and Corporate      Governance                                                                           | 33        |
| ITEM      11.  Executive Compensation                                                                                                                | 33        |
| ITEM      12.  Security Ownership of Certain Beneficial Owners and      Management and RelatedStockholder      Matters                               |  33  |
| ITEM      13.  Certain Relationships and Related Transactions and Director      Independence                                                         | 33        |
| ITEM      14.  Principal Accountant Fees and Services                                                                                                | 33        |
| PART      IV                                                                                                                                              |           |
| ITEM      15.  Exhibits and Financial Statement Schedules                                                                                            | 34             |

----

----

----

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| ·  | prohibiting the payment of      principal and interest on subordinated debt;                                                    |
|--------------|--------------------------------------------------------------------------------------------------------------------------------------|
| ·  | prohibiting the holding company      from obtaining distributions from the institution without prior regulatory      approval;  |

----

| ·  | placing limits on asset growth and      restrictions on activities;                      |
|--------------|-----------------------------------------------------------------------------------------------|
| ·  | placing additional restrictions on      transactions with affiliates;                    |
| ·  | restricting the interest rate the      institution may pay on deposits;                  |
| ·  | prohibiting the institution from      accepting deposits from correspondent banks; and   |
| ·  | in the most severe cases,      appointing a conservator or receiver for the      institution. |

----

----

----

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| DISTRIBUTION OF ASSETS,      LIABILITIES AND STOCKHOLDERS' EQUITY (TABLE A)                                                                                                                      |   |    |      |     |   |       |   |   |    |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------|-----------|----------|--------|------------|--------|--------|---------|--------|
| CAPITOL BANCORP      LIMITED                                                                                                                                                                     |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income, the primary      component of earnings, represents the difference between interest income      on interest-earning assets and interest expense on      interest-            |   |
| bearing liabilities. Net      interest income depends upon the volume of interest-earning assets and      interest-bearing liabilities and the rates earned or paid on      them. This |   |
| table shows the daily average      balances for the major asset and liability categories and the actual      related interest income and expense (in $1,000s) and      average                   |   |
| yield/cost for the years ended      December 31, 2007, 2006 and 2005.                                                                                                                            |   |    |      |     |   |       |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                             |   | 2007    |      |     | 2006   |       |   | 2005   |    |
|                                                                                                                                                                                             |   |    |      | Interest |   |  (1)  |   |   |    |   | Interest |   |  (1) |   |   |   |   | Interest |   |  (1) |   |
|                                                                                                                                                                                             |   | Average |      | Income/  |   | Average    |   |   | Average |   | Income/ |   | Average |   |   | Average |   | Income/ |   | Average |   |
|                                                                                                                                                                                             |   | Balance |      | Expense  |   | Yield/Cost |   |   | Balance |   | Expense |   | Yield/Cost |   |   | Balance |   | Expense |   | Yield/Cost |   |
| ASSETS                                                                                                                                                                                           |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |
|  Money market and      interest-bearing deposits                                                                                                                                            |   | $       | 23,912    |     | $      | 1,120      |   | 4.68   | %       |   | $ | 33,123 |   | $ | 1,403 |   | 4.24 | % |   | $ | 20,673 |   | $ | 635 |   | 3.07 | % |
|  Federal funds      sold                                                                                                                                                                    |   |    | 205,294   |     |   | 10,687     |   | 5.21   | %       |   |   | 171,445 |   |   | 8,703 |   | 5.08 | % |   |   | 144,536 |   |   | 4,734 |   | 3.28 | % |
|  Investment securities --      U.S. Treasury, government                                                                                                                                    |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |
|    agencies, mutual      funds and other                                                                                                                                          |   |    | 39,330    |     |   | 1,699      |   | 4.32   | %       |   |   | 42,277 |   |   | 1,806 |   | 4.27 | % |   |   | 45,948 |   |   | 1,561 |   | 3.40 | % |
|  Loans held for      sale                                                                                                                                                                   |   |    | 24,427    |     |   | 2,133      |   | 8.73   | %       |   |   | 36,306 |   |   | 2,740 |   | 7.55 | % |   |   | 33,710 |   |   | 2,627 |   | 7.79 | % |
|  Portfolio loans      (2)                                                                                                                                                                   |   |    | 3,840,526 |     |   | 314,800    |   | 8.20   | %       |   |   | 3,236,538 |   |   | 264,701 |   | 8.18 | % |   |   | 2,834,973 |   |   | 214,882 |   | 7.58 | % |
|         Total      interest-earning                                                                                                                      |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|            assets/interest      income                                                                                                    |   |    | 4,133,489 |     |   | 330,439    |   | 7.99   | %       |   |   | 3,519,689 |   |   | 279,353 |   | 7.94 | % |   |   | 3,079,840 |   |   | 224,439 |   | 7.29 | % |
|  Allowance for loan losses      (deduct)                                                                                                                                                    |   |    | (50,316   | )   |   |       |   |   |    |   |   | (44,000 | )  |   |   |   |   |   |   |   | (38,628 | )  |   |   |   |   |   |
|  Cash and due from      banks                                                                                                                                                               |   |    | 153,042   |     |   |       |   |   |    |   |   | 150,782 |   |   |   |   |   |   |   |   | 141,271 |   |   |   |   |   |   |
|  Premises and equipment,      net                                                                                                                                                           |   |    | 56,925    |     |   |       |   |   |    |   |   | 50,656 |   |   |   |   |   |   |   |   | 33,063 |   |   |   |   |   |   |
|  Other      assets                                                                                                                                                                          |   |    | 159,855   |     |   |       |   |   |    |   |   | 119,987 |   |   |   |   |   |   |   |   | 97,893 |   |   |   |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                          Total      assets                          |   | $       | 4,452,995 |     |   |       |   |   |    |   | $ | 3,797,114 |   |   |   |   |   |   |   | $ | 3,313,439 |   |   |   |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS'      EQUITY                                                                                                                                                        |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|  Interest-bearing      deposits:                                                                                                                                                            |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Savings      deposits                                                                                                                                                          |   | $       | 83,632    |     |   | 2,291      |   | 2.74   | %       |   | $ | 59,985 |   |   | 981 |   | 1.64 | % |   | $ | 71,890 |   |   | 844 |   | 1.17 | % |
|    Time deposits      under $100,000                                                                                                                                              |   |    | 569,773   |     |   | 28,060     |   | 4.92   | %       |   |   | 429,108 |   |   | 17,983 |   | 4.19 | % |   |   | 338,920 |   |   | 10,790 |   | 3.18 | % |
|    Time deposits      $100,000 and over                                                                                                                                           |   |    | 1,031,011 |     |   | 52,828     |   | 5.12   | %       |   |   | 889,769 |   |   | 38,115 |   | 4.28 | % |   |   | 717,851 |   |   | 21,701 |   | 3.02 | % |
|    Other      interest-bearing deposits                                                                                                                                           |   |    | 1,227,480 |     |   | 40,981     |   | 3.34   | %       |   |   | 1,066,109 |   |   | 31,550 |   | 2.96 | % |   |   | 998,165 |   |   | 19,878 |   | 1.99 | % |
|  Notes payable and short-term      borrowings                                                                                                                                               |   |    | 220,996   |     |   | 11,048     |   | 5.00   | %       |   |   | 173,719 |   |   | 8,169 |   | 4.70 | % |   |   | 170,853 |   |   | 6,485 |   | 3.80 | % |
|  Subordinated      debentures                                                                                                                                                               |   |    | 143,390   |     |   | 11,954     |   | 8.34   | %       |   |   | 100,999 |   |   | 8,788 |   | 8.70 | % |   |   | 100,892 |   |   | 7,881 |   | 7.81 | % |
|         Total      interest-bearing                                                                                                                      |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|            liabilities/interest      expense                                                                                              |   |    | 3,276,282 |     |   | 147,162    |   | 4.49   | %       |   |   | 2,719,689 |   |   | 105,586 |   | 3.88 | % |   |   | 2,398,571 |   |   | 67,579 |   | 2.82 | % |
|  Noninterest-bearing demand      deposits                                                                                                                                                   |   |    | 628,345   |     |   |       |   |   |    |   |   | 614,529 |   |   |   |   |   |   |   |   | 564,823 |   |   |   |   |   |   |
|  Accrued interest on deposits      and                                                                                                                                                      |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    other      liabilities                                                                                                                                                         |   |    | 31,640    |     |   |       |   |   |    |   |   | 25,305 |   |   |   |   |   |   |   |   | 20,912 |   |   |   |   |   |   |
|  Minority interests in      consolidated subsidiaries                                                                                                                                       |   |    | 133,170   |     |   |       |   |   |    |   |   | 110,060 |   |   |   |   |   |   |   |   | 59,927 |   |   |   |   |   |   |
|  Stockholders'      equity                                                                                                                                                                  |   |    | 383,558   |     |   |       |   |   |    |   |   | 327,531 |   |   |   |   |   |   |   |   | 269,206 |   |   |   |   |   |   |
|                         Total      liabilities and                       |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                            stockholders'      equity      |   | $       | 4,452,995 |     |   |       |   |   |    |   | $ | 3,797,114 |   |   |   |   |   |   |   | $ | 3,313,439 |   |   |   |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest      income                                                                                                                                                                         |   |    |      |     | $      | 183,277    |   |   |    |   |   |   |   | $ | 173,767 |   |   |   |   |   |   |   | $ | 156,860 |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Rate Spread      (3)                                                                                                                                                                    |   |    |      |     |   |       |   | 3.50   | %       |   |   |   |   |   |   |   | 4.06 | % |   |   |   |   |   |   |   | 4.47 | % |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net Yield on Interest-Earning      Assets (4)                                                                                                                                                    |   |    |      |     | 4.43   | %          |   |   |    |   |   |   |   | 4.94 | % |   |   |   |   |   |   |   | 5.09 | % |
| Ratio of Average      Interest-Earning                                                                                                                                                           |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Assets to      Interest-Bearing Liabilities                                                                                                                                    |   |    | 1.26      |     |   |       |   |   |    |   |   | 1.29 |   |   |   |   |   |   |   |   | 1.28 |   |   |   |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                             |   |    |      |     |   |       |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (1) Average yield/cost is      determined by dividing the actual interest income/expense by the daily      average balance of the asset or liability category.                                   |   |
| (2) Average balance of loans      includes nonaccrual loans.                                                                                                                                     |   |    |      |     |   |       |   |   |    |   |   |   |
| (3) Interest rate spread      represents the average yield on interest-earning assets less the average      cost of interest-bearing liabilities.                                                |   |
| (4) Net yield is based on net      interest income as a percentage of average total interest-earning      assets.                                                                                |   |

----

| CHANGES IN NET INTEREST INCOME      (TABLE B)                                                                                                                     |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------|--------|--------|----------------------------------|--------|---------|-----------|--------|--------|--------|--------|--------|--------|--------|
| CAPITOL BANCORP      LIMITED                                                                                                                                      |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                              |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                              |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                              |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |
| The table below summarizes the      extent to which changes in interest rates and changes in the volume of      interest-earning assets and interest-bearing      |
| liabilities have affected      Capitol's net interest income (in $1,000s). The change in interest      attributable to volume is calculated by  multiplying  |
| the annual change in volume by the      prior year's rate. The change in interest attributable to rate is      calculated by multiplying the annual change   |
| in rate by the prior year's      average balance. Any variance attributable jointly to volume and rate      changes has been allocated to each categorybased |
| on the percentage of each to the      total change in both categories.                                                                                            |   |                             |   |   |                             |   |    |      |   |   |   |   |
|                                                                                                                                                              |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                              |   |  2007 compared to      2006 |   |   |  2006 compared to      2005 |
|                                                                                                                                                              |   | Volume                           |   |   | Rate                             |   |    | Net Total |   |   | Volume |   |   | Rate   |   |   | NetTotal |
| Increase (decrease) in interest      income:                                                                                                                      |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |
|   Money market and      interest-bearing deposits                                                                                                       |   | $                                | (420   | )      |                             | $      | 137     |      |   | $      | (283   | )      |   | $      | 471    |   |   | $ | 297 |   |   | $ | 768 |
|   Federal funds      sold                                                                                                                               |   |                             | 1,757  |   |                             |   | 227     |      |   |   | 1,984  |   |   |   | 1,004  |   |   |   | 2,965 |   |   |   | 3,969 |
|   Investment securities --      U.S. Treasury, government                                                                                                    |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |   |   |   |
|     agencies,      mutual funds and other                                                                                                     |   |                             | (127   | )      |                             |   | 20      |      |   |   | (107   | )      |   |   | (132   | ) |   |   | 377 |   |   |   | 245 |
|   Loans held for      sale                                                                                                                              |   |                             | (992   | )      |                             |   | 385     |      |   |   | (607   | )      |   |   | 198    |   |   |   | (85 | ) |   |   | 113 |
|   Portfolio      loans                                                                                                                                  |   |                             | 49,506 |   |                             |   | 593     |      |   |   | 50,099 |   |   |   | 31,981 |   |   |   | 17,838 |   |   |   | 49,819 |
| Total                                                                                                                                                             |   |                             | 49,724 |   |                             |   | 1,362   |      |   |   | 51,086 |   |   |   | 33,522 |   |   |   | 21,392 |   |   |   | 54,914 |
|                                                                                                                                                              |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                              |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Increase (decrease) in interest      expense:                                                                                                                     |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Interest-bearing      deposits:                                                                                                                       |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Savings      deposits                                                                                                                     |   |                             | 483    |   |                             |   | 827     |      |   |   | 1,310  |   |   |   | (156   | ) |   |   | 293 |   |   |   | 137 |
|     Time      deposits under $100,000                                                                                                         |   |                             | 6,568  |   |                             |   | 3,509   |      |   |   | 10,077 |   |   |   | 3,286  |   |   |   | 3,907 |   |   |   | 7,193 |
|     Time      deposits $100,000 and over                                                                                                      |   |                             | 6,581  |   |                             |   | 8,132   |      |   |   | 14,713 |   |   |   | 5,988  |   |   |   | 10,426 |   |   |   | 16,414 |
|     Other      interest-bearing deposits                                                                                                      |   |                             | 5,107  |   |                             |   | 4,324   |      |   |   | 9,431  |   |   |   | 1,434  |   |   |   | 10,238 |   |   |   | 11,672 |
|   Notes payable and      short-term borrowings                                                                                                          |   |                             | 2,337  |   |                             |   | 542     |      |   |   | 2,879  |   |   |   | 110    |   |   |   | 1,574 |   |   |   | 1,684 |
|   Subordinated      debentures                                                                                                                          |   |                             | 3,548  |   |                             |   | (382    | )         |   |   | 3,166  |   |   |   | 8      |   |   |   | 899 |   |   |   | 907 |
| Total                                                                                                                                                             |   |                             | 24,624 |   |                             |   | 16,952  |      |   |   | 41,576 |   |   |   | 10,670 |   |   |   | 27,337 |   |   |   | 38,007 |
| Increase (decrease) in      net                                                                                                                                   |   |                             |   |   |                             |   |    |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   interest      income                                                                                                                                  |   | $                                | 25,100 |   |                             | $      | (15,590 | )         |   | $      | 9,510  |   |   | $      | 22,852 |   |   | $ | (5,945 | ) |   | $ | 16,907 |

----

| INVESTMENT PORTFOLIO (TABLE      C)                                                                                                                     |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|
| CAPITOL BANCORP      LIMITED                                                                                                                            |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |   |
|                                                                                                                                                    |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |   |
|                                                                                                                                                    |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |   |
|                                                                                                                                                    |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |   |
| The table below shows amortized      cost and estimated market value of investment securities as of December      31, 2007, 2006 and 2005 (in $1,000s): |
|                                                                                                                                                    |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |   |
|                                                                                                                                                    |   | 2007      |   |   | 2006      |   |   | 2005      |
|                                                                                                                                                    |   |      |   |   | Estimated |   |   |      |   |   | Estimated |   |   |      |   |   | Estimated |
|                                                                                                                                                    |   | Amortized |   |   | Market    |   |   | Amortized |   |   | Market    |   |   | Amortized |   |   | Market |
|                                                                                                                                                    |   | Cost      |   |   | Value     |   |   | Cost      |   |   | Value     |   |   | Cost      |   |   | Value |
|                                                                                                                                                    |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |   |
| Available for      sale:                                                                                                                                |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |   |
|    United States      treasury securities                                                                                                     |   | $         | 499    |   |      | $      | 499    |      |   |   |      |   |   |      |   |   |   |   |   |
|    United States      government agency securities                                                                                            |   |      | 8,991  |   |      |   | 9,025  |      |   | $      | 13,403    |   |   | $         | 13,285 |   |   | $ | 23,276 |   |   | $ | 23,022 |
|    Mortgage-backed      securities                                                                                                            |   |      | 3,402  |   |      |   | 3,368  |      |   |   | 4,089     |   |   |      | 3,991  |   |   |   | 2,437 |   |   |   | 2,355 |
|    Municipals                                                                                                                            |   |      | 1,222  |   |      |   | 1,227  |      |   |   | 1,630     |   |   |      | 1,628  |   |   |   | 1,640 |   |   |   | 1,631 |
|                                                                                                                                                    |   |      | 14,114 |   |      |   | 14,119 |      |   |   | 19,122    |   |   |      | 18,904 |   |   |   | 27,353 |   |   |   | 27,008 |
| Held for long-term      investment:                                                                                                                     |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |   |   |   |   |   |   |   |
|    Federal Reserve Bank      stock                                                                                                            |   |      | 563    |   |      |   | 563    |      |   |   | 864       |   |   |      | 864    |   |   |   | 536 |   |   |   | 536 |
|    Federal Home Loan      Bank stock                                                                                                          |   |      | 18,765 |   |      |   | 18,765 |      |   |   | 14,148    |   |   |      | 14,148 |   |   |   | 12,960 |   |   |   | 12,960 |
|    Corporate                                                                                                                             |   |      | 4,204  |   |      |   | 4,204  |      |   |   | 4,419     |   |   |      | 4,419  |   |   |   | 1,835 |   |   |   | 1,835 |
|    Other                                                                                                                                 |   |      | 1,946  |   |      |   | 1,946  |      |   |   | 2,318     |   |   |      | 2,318  |   |   |   | 1,335 |   |   |   | 1,335 |
|                                                                                                                                                    |   |      | 25,478 |   |      |   | 25,478 |      |   |   | 21,749    |   |   |      | 21,749 |   |   |   | 16,666 |   |   |   | 16,666 |
|                                                                                                                                                    |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                    |   | $         | 39,592 |   |      | $      | 39,597 |      |   | $      | 40,871    |   |   | $         | 40,653 |   |   | $ | 44,019 |   |   | $ | 43,674 |

|                                                          |   |      |   |   | Estimated |   |    | Weighted |   |
|---------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|---------|----------|--------|
|                                                          |   | Amortized |   | Market |      |   | Average |     |
|                                                          |   | Cost      |   |   | Value     |   |    | Yield    |   |
| Maturity:                                                     |   |      |   |   |      |   |    |     |   |
|    Due in one year or      less                     |   | $         | 2,220  |   |      | $      | 2,218   |     |   |   | 3.96 | % |
|    After one year,      through five years          |   |      | 6,145  |   |      |   | 6,175   |     |   |   | 9.25 | % |
|    After five years,      through ten years         |   |      | 2,974  |   |      |   | 2,975   |     |   |   | 9.48 | % |
|    After ten      years                        |   |      | 2,775  |   |      |   | 2,751   |     |   |   | 5.82 | % |
|    Securities held for      long-term investment,   |   |      |   |   |      |
|            without stated maturities |   |      | 25,478 |   |      |   | 25,478  |     |   |   |   |   |
|                                                          |   |      |   |   |      |   |    |     |   |   |   |   |
| Total                                                         |   | $    | 39,592 |   |      | $      | 39,597  |     |   |   |   |   |

| United States treasury      securities          | 0      years     and          1 month        |
|-------------------------------------------------|-------------------------------------------------------------------------------------------|
| United States government agency      securities | 3      years     and          6 months       |
| Mortgage-backed      securities                 | 2      years     and           3 months |
| Municipals                                      | 3      years     and          10  months     |

----

| LOAN PORTFOLIO AND SUMMARY OF      OTHER REAL ESTATE OWNED (TABLE D)             |   |   |      |   |   |   |   |   |   |      |   |
|----------------------------------------------------------------------------------|--------|--------|-----------|--------|--------|--------|--------|--------|--------|-----------|--------|
| CAPITOL BANCORP      LIMITED                                                     |   |   |      |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                             |   |   |      |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                             |   |   |      |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Portfolio loans outstanding as of      December 31 are shown below (in $1,000s): |   |   |      |   |   |   |   |   |   |      |   |   |   |
|                                                                             |   |   |      |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                             |   |   |      |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                             |   | 2007   |      | 2006   |   | 2005   |   | 2004   |   | 2003      |
| Loans secured by real      estate:                                               |   |   |      |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Commercial                                                           |   | $      | 1,917,113 |   |   | 44.43  | %      |   | $      | 1,602,743 |   |   | 45.94 | % |   | $ | 1,352,338 |   |   | 45.21 | % |   | $ | 1,187,648 |   |   | 44.10 | % |   | $ | 999,508 |   |   | 44.47 | % |
|   Residential (including      multi-family)                            |   |   | 698,960   |   |   | 16.20  | %      |   |   | 529,357   |   |   | 15.17 | % |   |   | 501,861 |   |   | 16.78 | % |   |   | 487,048 |   |   | 18.09 | % |   |   | 413,068 |   |   | 18.38 | % |
|   Construction, land      development and                                   |   |   |      |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      other      land                                         |   |   | 852,595   |   |   | 19.76  | %      |   |   | 705,255   |   |   | 20.22 | % |   |   | 579,132 |   |   | 19.36 | % |   |   | 499,166 |   |   | 18.54 | % |   |   | 361,235 |   |   | 16.07 | % |
| Total loans secured by real      estate                                          |   |   | 3,468,668 |   |   | 80.39  | %      |   |   | 2,837,355 |   |   | 81.33 | % |   |   | 2,433,331 |   |   | 81.35 | % |   |   | 2,173,862 |   |   | 80.73 | % |   |   | 1,773,811 |   |   | 78.92 | % |
| Commercial and other      business-purpose                                       |   |   |      |   |   |   |   |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|         loans                                                          |   |   | 768,473   |   |   | 17.81  | %      |   |   | 602,294   |   |   | 17.26 | % |   |   | 512,018 |   |   | 17.12 | % |   |   | 474,781 |   |   | 17.63 | % |   |   | 432,763 |   |   | 19.26 | % |
| Consumer                                                                         |   |   | 48,041    |   |   | 1.11   | %      |   |   | 39,957    |   |   | 1.15 | % |   |   | 37,661 |   |   | 1.26 | % |   |   | 32,947 |   |   | 1.22 | % |   |   | 35,117 |   |   | 1.56 | % |
| Other                                                                            |   |   | 29,519    |   |   | 0.69   | %      |   |   | 9,072     |   |   | 0.26 | % |   |   | 8,179 |   |   | 0.27 | % |   |   | 11,314 |   |   | 0.42 | % |   |   | 5,749 |   |   | 0.26 | % |
| Total portfolio      loans                                                       |   | $      | 4,314,701 |   |   | 100.00 | %      |   | $      | 3,488,678 |   |   | 100.00 | % |   | $ | 2,991,189 |   |   | 100.00 | % |   | $ | 2,692,904 |   |   | 100.00 | % |   | $ | 2,247,440 |   |   | 100.00 | % |

|                                                               |   | Fixed  |      |   | Variable |   |      |   |
|--------------------------------------------------------------------|--------|--------|-----------|--------|----------|--------|-----------|--------|
|                                                               |   | Rate   |      |   | Rate     |   |      | Total  |
| Aggregate maturities of portfolio      loan balances which are due |
|   in one year or      less:                              |   | $      | 524,102   |   |     | $      | 1,039,515 |   |   | $ | 1,563,617 |
|    After one year      but within five years        |   |   | 1,288,211 |   |     |   | 381,535   |   |   |   | 1,669,746 |
|    After five      years                            |   |   | 221,348   |   |     |   | 791,905   |   |   |   | 1,013,253 |
|    Nonaccrual      loans                            |   |   | 21,082    |   |     |   | 47,003    |   |   |   | 68,085 |
| Total                                                              |   | $      | 2,054,743 |   |     | $      | 2,259,958 |   |   | $ | 4,314,701 |

| The following summarizes, in      general, Capitol's various loan classifications:                                                                                                                                        |   |   |   |   |   |   |   |   |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans secured by real      estate                                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Commercial                                                                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Comprised      of a broad mix of business use and nonfarm nonresidential properties,      including office, retail, warehouse and light industrial      uses. |
|           A      typical loan size is generally less than $1,000,000 and, at December 31,      2007, approximately 27% of such properties were      owner-occupied.     |
|                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Residential      (including multi-family)                                                                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Includes      single and multi family residential loans held for permanent portfolio and      home equity lines of credit.                                    |
|                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Construction,      land development and other land                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Includes      loans made to finance land development for new or existing structures,      vacant land and agricultural land.                                  |
|                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial and other      business-purpose loans                                                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Includes      a range of loans for sole proprietorships, partnerships, corporations, and      other business enterprises and also to individuals    for       |
|           commercial,      industrial and professional purposes but not for investment or personal      expenditure purposes.                                           |   |   |
|                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consumer                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Includes      a broad range of installment credit products, secured by automobiles,      boats, etc., with typical consumer credit risks.                     |
|                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other                                                                                                                                                                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Includes      loans to finance agricultural production, obligations of states and      political subdivisions in the US and nonprofit      organizations.     |
|                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| All loans are subject to      underwriting procedures commensurate with the loan size, nature of      collateral, industry trends, risks and experience      factors.                                                     |
| Appropriate collateral is required      for most loans, as is documented evidence of debt repayment      sources.                                                                                                         |
|                                                                                                                                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| LOAN PORTFOLIO AND SUMMARY OF      OTHER REAL ESTATE OWNED (TABLE D - CONTINUED)                                                                                     |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| CAPITOL BANCORP      LIMITED                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| The aggregate amount of      nonperforming portfolio loans is summarized below as of December 31 (in      $1,000s). Nonperforming loans are comprised of        |   |
| (a) loans accounted for on a      nonaccrual basis and (b) loans contractually past due 90 days or more as      to principal and interest payments (but notincluded  |   |
| in nonaccrual loans in (a) above)      and consist primarily of loans secured by real estate. See Note D of      the Notes to Consolidated Financial Statements |   |
| for additional information      regarding nonperforming loans.                                                                                                       |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                 |   | 2007 |   |   | 2006 |   |   | 2005 |   |   | 2004 |   |   | 2003 |   |
| Nonperforming      loans:                                                                                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Nonaccrual      loans:                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans secured by real      estate:                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                                                                                                                                                           |   | $ | 19,016 |   |   | $ | 8,771 |   |   | $ | 9,451 |   |   | $ | 4,713 |   |   | $ | 4,958 |   |
| Residential (including      multi-family)                                                                                                                            |   |   | 13,381 |   |   |   | 6,808 |   |   |   | 4,826 |   |   |   | 7,632 |   |   |   | 5,297 |   |
| Construction, land development      and                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    other      land                                                                                                                                    |   |   | 29,756 |   |   |   | 8,583 |   |   |   | 2,847 |   |   |   | 2,252 |   |   |   | 2,805 |   |
| Total loans secured by real      estate                                                                                                                              |   |   | 62,153 |   |   |   | 24,162 |   |   |   | 17,124 |   |   |   | 14,597 |   |   |   | 13,060 |   |
|         Commercial      and other business-purpose loans                                                                     |   |   | 5,782 |   |   |   | 5,349 |   |   |   | 5,279 |   |   |   | 8,491 |   |   |   | 7,740 |   |
|         Consumer                                                                                                             |   |   | 66 |   |   |   | 215 |   |   |   | 219 |   |   |   | 121 |   |   |   | 60 |   |
|         Other                                                                                                                |   |   | 84 |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |
| Total nonaccrual      loans                                                                                                                                          |   |   | 68,085 |   |   |   | 29,726 |   |   |   | 22,622 |   |   |   | 23,209 |   |   |   | 20,860 |   |
|                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Past due      loans:                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans secured by real      estate:                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                                                                                                                                                           |   |   | 113 |   |   |   | 1,380 |   |   |   | 739 |   |   |   | 1,609 |   |   |   | 1,033 |   |
| Residential (including      multi-family)                                                                                                                            |   |   | 1,116 |   |   |   | 526 |   |   |   | 1,891 |   |   |   | 2,726 |   |   |   | 2,730 |   |
| Construction, land development      and                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    other      land                                                                                                                                    |   |   | 2,531 |   |   |   | 1,116 |   |   |   | 864 |   |   |   | 80 |   |   |   | 57 |   |
| Total loans secured by real      estate                                                                                                                              |   |   | 3,760 |   |   |   | 3,022 |   |   |   | 3,494 |   |   |   | 4,415 |   |   |   | 3,820 |   |
|         Commercial      and other business-purpose loans                                                                     |   |   | 714 |   |   |   | 1,375 |   |   |   | 339 |   |   |   | 568 |   |   |   | 1,985 |   |
|         Consumer                                                                                                             |   |   | 66 |   |   |   | 151 |   |   |   | 140 |   |   |   | 102 |   |   |   | 110 |   |
|         Other                                                                                                                |   |   | 5 |   |   |   | -- |   |   |   | 137 |   |   |   | 177 |   |   |   | 97 |   |
| Total past due      loans                                                                                                                                            |   |   | 4,545 |   |   |   | 4,548 |   |   |   | 4,110 |   |   |   | 5,262 |   |   |   | 6,012 |   |
|                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total nonperforming      loans                                                                                                                                       |   | $ | 72,630 |   |   | $ | 34,274 |   |   | $ | 26,732 |   |   | $ | 28,471 |   |   | $ | 26,872 |   |
|                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Nonperforming loans as a      percentage                                                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    of total      portfolio loans                                                                                                                      |   |   | 1.68 | % |   |   | 0.98 | % |   |   | 0.89 | % |   |   | 1.06 | % |   |   | 1.20 | % |
|                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Nonperforming loans as a      percentage                                                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    of total      assets                                                                                                                               |   |   | 1.48 | % |   |   | 0.84 | % |   |   | 0.77 | % |   |   | 0.92 | % |   |   | 0.98 | % |
|                                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses as      a                                                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    percentage of      nonperforming loans                                                                                                             |   |   | 80.03 | % |   |   | 132.50 | % |   |   | 151.72 | % |   |   | 131.97 | % |   |   | 116.87 | % |

| In addition to the identification      of nonperforming loans involving borrowers with payment performance      difficulties (i.e., nonaccrual loans and loans  past                             |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| due 90 days or more), management      utilizes an internal loan review process to identify other potential      problem loans which may warrant additional    monitoring                         |
| or other      attention.  This loan review process is a continuous activity      which periodically updates internal loan classifications.  At      inception, all loans are |
| individually assigned a      classification which grades the credits on a risk basis, assessing the      financial strength of the borrower and guarantors and      other                        |
| factors such as the borrowers'      historical and projected financial performance.  The loan      classification process is fluid and subjective.                                     |
|                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Potential problem loans include      loans which are generally performing as agreed; however, because of loan      review's and/or lending staff's risk assessment,                              |
| increased monitoring is deemed      appropriate.  In addition, some loans are identified for      monitoring because of specific performance issues or other      risk                 |
| factors requiring closer      management and development of specific remedial action      plans.                                                                                                 |   |
|                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| At December 31, 2007, potential      problem loans (which includes nonperforming loans) approximated $219      million or about 5% of total consolidated                                         |
| portfolio loans.  Such      totals typically approximate 4% to 5% of loans outstanding and are an      important part of management's ongoing and  proactive                           |
| loan review activities which are      designed to early-identify loans which warrant close monitoring at the      bank and corporate credit-administration levels.                               |
| It is important to note that these      potential problem loans do not necessarily have significant loss exposure      (nor are they necessarily deemed 'impaired'),                             |
| but rather are identified by      management in this manner to aid in loan administration and risk      management.  These loans are considered in      management's                   |
| evaluation of the adequacy of the      allowance for loan losses.                                                                                                                                |   |   |   |   |   |
|                                                                                                                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| The table below summarizes      activity in other real estate owned (in $1,000s) for the year ended      December 31:                                                                            |

|                                                                                |   | 2007   |    |   | 2006   |   |   | 2005   |   |   | 2004   |   |   | 2003   |   |
|-------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                                                                |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |
|     Other real      estate owned at January 1                   |   | $      | 9,464   |   |   | $      | 3,733  |   |   | $      | 3,855  |   |   | $      | 4,248  |   |   | $ | 4,605 |   |
|                                                                                |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Properties      acquired in restructure                     |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|        of      loans or in lieu of foreclosure   |   |   | 17,216  |   |   |   | 8,870  |   |   |   | 5,718  |   |   |   | 4,233  |   |   |   | 3,898 |   |
|                                                                                |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Properties      sold                                        |   |   | (10,021 | )      |   |   | (2,806 | )      |   |   | (4,440 | )      |   |   | (3,833 | ) |   |   | (3,704 | ) |
|                                                                                |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Payments      received from borrowers or                    |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|        tenants,      credited to carrying amount |   |   | (162    | )      |   |   | -      |   |   |   | -      |   |   |   | (552   | ) |   |   | (121 | ) |
|                                                                                |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Other      changes, net                                     |   |   | (140    | )      |   |   | (333   | )      |   |   | (1,400 | )      |   |   | (241   | ) |   |   | (430 | ) |
|                                                                                |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Other real      estate owned at December 31                 |   | $      | 16,357  |   |   | $      | 9,464  |   |   | $      | 3,733  |   |   | $      | 3,855  |   |   | $ | 4,248 |   |

| Other real estate owned is valued      at estimated fair value (net of estimated selling cost) at the date of      transfer/acquisition.  Management  performs |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| a periodic analysis of estimated      fair values to determine potential impairment of other real estate      owned.                                                     |

----

| SUMMARY OF LOAN LOSS EXPERIENCE      (TABLE E)                                                                                                     |   |   |      |   |   |   |      |   |   |   |      |   |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|--------|--------|-----------|--------|--------|--------|-----------|--------|--------|
| CAPITOL BANCORP      LIMITED                                                                                                                       |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |
| The table below summarizes changes      in the allowance for loan losses and related portfolio data and ratios for      the year ended December 31 |   |
| (in    $1,000s):                                                                                                                                   |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |
|                                                                                                                                               |   | 2007   |      |   | 2006   |   |      | 2005   |   |   | 2004      |   |   | 2003 |   |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |
| Allowance for loan losses at      January 1                                                                                                        |   | $      | 45,414    |   |   | $      | 40,559    |   |   | $      | 37,572    |   |   | $ | 31,404 |   |   | $ | 28,953 |   |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses of      acquired                                                                                                         |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|    bank      subsidiary                                                                                                             |   |   |      |   |   |   |      |   |   |   |      |   |   |   | 724 |   |   |   |   |   |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
| Loans charged      off:                                                                                                                            |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|     Loans      secured by real estate:                                                                                         |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|       Commercial                                                                                                     |   |   | (3,102    | )      |   |   | (2,737    | )      |   |   | (1,182    | )      |   |   | (827 | ) |   |   | (204 | ) |
|       Residential      (including multi-family)                                                                      |   |   | (3,265    | )      |   |   | (1,831    | )      |   |   | (2,348    | )      |   |   | (1,005 | ) |   |   | (1,796 | ) |
|       Construction,      land development and                                                                        |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|          other      land                                                                              |   |   | (1,192    | )      |   |   | (812      | )      |   |   | (346      | )      |   |   | (953 | ) |   |   | (362 | ) |
| Total loans secured by real      estate                                                                                                            |   |   | (7,559    | )      |   |   | (5,380    | )      |   |   | (3,876    | )      |   |   | (2,785 | ) |   |   | (2,362 | ) |
|     Commercial      and other business-purpose loans                                                                           |   |   | (6,257    | )      |   |   | (2,943    | )      |   |   | (4,988    | )      |   |   | (5,306 | ) |   |   | (6,032 | ) |
|     Consumer                                                                                                                   |   |   | (403      | )      |   |   | (255      | )      |   |   | (776      | )      |   |   | (277 | ) |   |   | (377 | ) |
|     Other                                                                                                                      |   |   | --        |   |   |   | (121      | )      |   |   | (3        | )      |   |   | (20 | ) |   |   | (19 | ) |
| Total      charge-offs                                                                                                                             |   |   | (14,219   | )      |   |   | (8,699    | )      |   |   | (9,643    | )      |   |   | (8,388 | ) |   |   | (8,790 | ) |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
| Recoveries:                                                                                                                                        |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|     Loans      secured by real estate:                                                                                         |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|       Commercial                                                                                                     |   |   | 70        |   |   |   | 66        |   |   |   | 20        |   |   |   | 111 |   |   |   | 34 |   |
|       Residential      (including multi-family)                                                                      |   |   | 226       |   |   |   | 213       |   |   |   | 601       |   |   |   | 99 |   |   |   | 237 |   |
|       Construction,      land development and                                                                        |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|          other      land                                                                              |   |   | 20        |   |   |   | 8         |   |   |   | 4         |   |   |   | -- |   |   |   | 24 |   |
| Total loans secured by real      estate                                                                                                            |   |   | 316       |   |   |   | 287       |   |   |   | 625       |   |   |   | 210 |   |   |   | 295 |   |
|     Commercial      and other business-purpose loans                                                                           |   |   | 1,101     |   |   |   | 896       |   |   |   | 758       |   |   |   | 832 |   |   |   | 970 |   |
|     Consumer                                                                                                                   |   |   | 165       |   |   |   | 215       |   |   |   | 287       |   |   |   | 80 |   |   |   | 115 |   |
|     Other                                                                                                                      |   |   | 7         |   |   |   | --        |   |   |   | --        |   |   |   | 2 |   |   |   | -- |   |
| Total      recoveries                                                                                                                              |   |   | 1,589     |   |   |   | 1,398     |   |   |   | 1,670     |   |   |   | 1,124 |   |   |   | 1,380 |   |
| Net    charge-offs                                                                                                                                 |   |   | (12,630   | )      |   |   | (7,301    | )      |   |   | (7,973    | )      |   |   | (7,264 | ) |   |   | (7,410 | ) |
| Additions to allowance charged to      expense                                                                                                     |   |   | 25,340    |   |   |   | 12,156    |   |   |   | 10,960    |   |   |   | 12,708 |   |   |   | 9,861 |   |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|           Allowance      for loan losses at December 31                                          |   | $      | 58,124    |   |   | $      | 45,414    |   |   | $      | 40,559    |   |   | $ | 37,572 |   |   | $ | 31,404 |   |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
| Total portfolio loans outstanding      at December 31                                                                                              |   | $      | 4,314,701 |   |   | $      | 3,488,678 |   |   | $      | 2,991,189 |   |   | $ | 2,692,904 |   |   | $ | 2,247,440 |   |
| Ratio of allowance for loan losses      to                                                                                                         |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|    portfolio loans      outstanding                                                                                                 |   |   | 1.35      | %      |   |   | 1.30      | %      |   |   | 1.36      | %      |   |   | 1.40 | % |   |   | 1.40 | % |
|                                                                                                                                               |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
| Average total portfolio loans for      the year                                                                                                    |   | $      | 3,840,526 |   |   | $      | 3,236,538 |   |   | $      | 2,834,973 |   |   | $ | 2,492,379 |   |   | $ | 2,101,617 |   |
| Ratio of net charge-offs to      average                                                                                                           |   |   |      |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |   |   |
|    portfolio loans      outstanding                                                                                                 |   |   | 0.33      | %      |   |   | 0.23      | %      |   |   | 0.28      | %      |   |   | 0.29 | % |   |   | 0.35 | % |

----

| SUMMARY OF LOAN LOSS EXPERIENCE      (TABLE E - CONTINUED)                                                                                                                                                                                                                                                |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------|-----------|------------|--------|------------|------------------|------------|--------|------------------|--------|----------|------------------|--------|--------|------------|-----------|--------|
| CAPITOL BANCORP      LIMITED                                                                                                                                                                                                                                                                              |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                      |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                      |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |
| The amounts of the allowance for      loan losses allocated in the following table (in $1,000s) as of December      31, are based on management's estimate of losses inherent in the portfolio      at the balance sheet date, and should not be interpreted as      an indication of future charge-offs: |   |
|                                                                                                                                                                                                                                                                                                      |   |       |      |       |   |       |             |       |   |             |   |     |             |
|                                                                                                                                                                                                                                                                                                      |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                      |   |  2007 |      |  2006 |   |  2005 |             |  2004 |   |  2003       |
|                                                                                                                                                                                                                                                                                                      |   |       |      | Percentage |   |       |  Percentage |       |   |  Percentage |   |     |  Percentage |   |   | Percentage |
|                                                                                                                                                                                                                                                                                                      |   | Amount     |      | of Loans   |   | Amount     |             | of Loans   |   | Amount           |   | of Loans |             | Amount |   | of Loans   |      | Amount |   | of Loans |
|                                                                                                                                                                                                                                                                                                      |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |
| Loans secured by real      estate:                                                                                                                                                                                                                                                                        |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |
|     Commercial                                                                                                                                                                                                                                                                        |   | $          | 21,918    |       |   | 0.51       | %                |       | $      | 17,886           |   |     | 0.51             | %      |   | $          | 18,337    |   |   | 0.61 | % |   | $ | 16,570 |   |   | 0.61 | % |   | $ | 13,966 |   |   | 0.62 | % |
|     Residential      (including multi-family)                                                                                                                                                                                                                                         |   |       | 10,235    |       |   | 0.24       | %                |       |   | 7,234            |   |     | 0.21             | %      |   |       | 6,805     |   |   | 0.23 | % |   |   | 6,796 |   |   | 0.25 | % |   |   | 5,772 |   |   | 0.26 | % |
|     Construction,      land development and                                                                                                                                                                                                                                                |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |   |   |   |   |
|        other      land                                                                                                                                                                                                                                                 |   |       | 11,278    |       |   | 0.26       | %                |       |   | 8,471            |   |     | 0.24             | %      |   |       | 7,853     |   |   | 0.26 | % |   |   | 6,964 |   |   | 0.26 | % |   |   | 5,048 |   |   | 0.23 | % |
| Total loans secured by real      estate                                                                                                                                                                                                                                                                   |   |       | 43,431    |       |   | 1.01       | %                |       |   | 33,591           |   |     | 0.96             | %      |   |       | 32,995    |   |   | 1.10 | % |   |   | 30,330 |   |   | 1.12 | % |   |   | 24,786 |   |   | 1.11 | % |
|                                                                                                                                                                                                                                                                                                      |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial and other      business-purpose                                                                                                                                                                                                                                                                |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |   |   |   |   |
|    loans                                                                                                                                                                                                                                                                                   |   |       | 13,727    |       |   | 0.32       | %                |       |   | 11,112           |   |     | 0.32             | %      |   |       | 6,943     |   |   | 0.23 | % |   |   | 6,624 |   |   | 0.25 | % |   |   | 6,047 |   |   | 0.27 | % |
| Consumer                                                                                                                                                                                                                                                                                                  |   |       | 667       |       |   | 0.01       | %                |       |   | 558              |   |     | 0.02             | %      |   |       | 510       |   |   | 0.02 | % |   |   | 460 |   |   | 0.02 | % |   |   | 491 |   |   | 0.02 | % |
| Other                                                                                                                                                                                                                                                                                                     |   |       | 299       |       |   | 0.01       | %                |       |   | 153              |   |     | 0.00             | %      |   |       | 111       |   |   | 0.01 | % |   |   | 158 |   |   | 0.01 | % |   |   | 80 |   |   | 0.00 | % |
|                                                                                                                                                                                                                                                                                                      |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       Total      allowance for loan losses                                                                                                                                                                                                                                  |   | $          | 58,124    |       |   | 1.35       | %                |       | $      | 45,414           |   |     | 1.30             | %      |   | $          | 40,559    |   |   | 1.36 | % |   | $ | 37,572 |   |   | 1.40 | % |   | $ | 31,404 |   |   | 1.40 | % |
|                                                                                                                                                                                                                                                                                                      |   |       |      |       |   |       |             |       |   |             |   |     |             |   |   |       |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total portfolio loans      outstanding                                                                                                                                                                                                                                                                    |   | $          | 4,314,701 |       |   |       |             |       | $      | 3,488,678        |   |     |             |   |   | $          | 2,991,189 |   |   |   |   |   | $ | 2,692,904 |   |   |   |   |   | $ | 2,247,440 |   |   |   |   |

----

| AVERAGE DEPOSITS (TABLE      F)                                                                                                    |   |       |      |   |       |   |   |       |   |    |      |   |   |   |   |   |    |   |
|------------------------------------------------------------------------------------------------------------------------------------|--------|------------|-----------|--------|------------|--------|--------|------------|--------|---------|-----------|--------|--------|--------|--------|--------|---------|--------|
| CAPITOL BANCORP      LIMITED                                                                                                       |   |       |      |   |       |   |   |       |   |    |      |   |   |   |   |   |    |   |
|                                                                                                                               |   |       |      |   |       |   |   |       |   |    |      |   |   |   |   |   |    |   |
|                                                                                                                               |   |       |      |   |       |   |   |       |   |    |      |   |   |   |   |   |    |   |
|                                                                                                                               |   |       |      |   |       |   |   |       |   |    |      |   |   |   |   |   |    |   |
| The table below summarizes the      average balances of deposits (in $1,000s) and the average rates of      interest for the years |   |       |      |   |
| ended December 31, 2007, 2006 and      2005:                                                                                       |   |       |      |   |       |   |   |       |   |    |      |   |   |   |   |   |    |   |
|                                                                                                                               |   |       |      |   |       |   |   |       |   |    |      |   |   |   |   |   |    |   |
|                                                                                                                               |   |  2007 |      |   |  2006 |   |   |  2005 |   |
|                                                                                                                               |   |       |      |   | Average    |   |   |       |   |    | Average   |   |   |   |   |   | Average |   |
|                                                                                                                               |   | Amount     |      |   | Rate       |   |   | Amount     |   |    | Rate      |   |   | Amount |   |   | Rate    |   |
|                                                                                                                               |   |       |      |   |       |   |   |       |   |    |      |   |   |   |   |   |    |   |
| Noninterest-bearing demand      deposits                                                                                           |   | $          | 628,345   |   |       |   |   |       | $      | 614,529 |      |   |   |   |   | $      | 564,823 |   |   |   |   |
| Savings      deposits                                                                                                              |   |       | 83,632    |   |       |   | 2.74   | %          |   |    | 59,985    |   |   |   | 1.64   | %      |    |   | 71,890 |   |   |   | 1.17 | % |
| Time deposits under      $100,000                                                                                                  |   |       | 569,773   |   |       |   | 4.92   | %          |   |    | 429,108   |   |   |   | 4.19   | %      |    |   | 338,920 |   |   |   | 3.18 | % |
| Time deposits $100,000 and      over                                                                                               |   |       | 1,031,011 |   |       |   | 5.12   | %          |   |    | 889,769   |   |   |   | 4.28   | %      |    |   | 717,851 |   |   |   | 3.02 | % |
| Other interest-bearing      deposits                                                                                               |   |       | 1,227,480 |   |       |   | 3.34   | %          |   |    | 1,066,109 |   |   |   | 2.96   | %      |    |   | 998,165 |   |   |   | 1.99 | % |
|                                                                                                                               |   |       |      |   |       |   |   |       |   |    |      |   |   |   |   |   |    |   |   |   |   |   |   |   |
| Total    deposits                                                                                                                  |   | $          | 3,540,241 |   |       |   |   |       |   | $       | 3,059,500 |   |   |   |   |   |    | $      | 2,691,649 |   |   |   |   |   |

| Three months or      less        |   | $      | 407,957                                                                         |
|----------------------------------|--------|--------|---------------------------------------------------------------------------------|
| Three months to six      months  |   |   |             227,955 |
| Six months to twelve      months |   |   |             250,114 |
| Over 12    months                |   |   |             181,179 |
|                             |   |   |                                                                            |
| Total                            |   | $      | 1,067,205                                                                       |

----

| FINANCIAL RATIOS (TABLE      G)                                                           |   |                        |   |   |   |   |   |   |   |
|-------------------------------------------------------------------------------------------|--------|-----------------------------|--------|--------|--------|--------|--------|--------|--------|
| CAPITOL BANCORP      LIMITED                                                              |   |                        |   |   |   |   |   |   |   |
|                                                                                      |   |                        |   |   |   |   |   |   |   |
|                                                                                      |   |                        |   |   |   |   |   |   |   |
|                                                                                      |   |                        |   |   |   |   |   |   |   |
|                                                                                      |   | Year Ended December      31 |   |
|                                                                                      |   | 2007                        |   |   | 2006   |   |   | 2005   |   |
|                                                                                      |   |                        |   |   |   |   |   |   |   |
| Net income as a percentage      of:                                                       |   |                        |   |   |   |   |   |   |   |
|    Average      stockholders' equity                                       |   |                        | 5.72   | %      |   |   | 12.94  | %      |   |   | 13.34 | % |
|    Average total      assets                                               |   |                        | 0.49   | %      |   |   | 1.12   | %      |   |   | 1.08 | % |
|                                                                                      |   |                        |   |   |   |   |   |   |   |   |   |   |
| Capital    ratios:                                                                        |   |                        |   |   |   |   |   |   |   |   |   |   |
|    Average      stockholders' equity as a                                  |   |                        |   |   |   |   |   |   |   |   |   |   |
|       percentage      of average total assets               |   |                        | 8.61   | %      |   |   | 8.63   | %      |   |   | 8.12 | % |
|    Average total      equity (stockholders' equity and                     |   |                        |   |   |   |   |   |   |   |   |   |   |
|       minority      interests in consolidated subsidiaries) |   |                        |   |   |   |   |   |   |   |   |   |   |
|       as      a percentage of average total assets          |   |                        | 11.60  | %      |   |   | 11.52  | %      |   |   | 9.93 | % |
|    Average total      capital funds (stockholders'                         |   |                        |   |   |   |   |   |   |   |   |   |   |
|       equity,      minority interests in consolidated       |   |                        |   |   |   |   |   |   |   |   |   |   |
|       subsidiaries      and subordinated debentures)        |   |                        |   |   |   |   |   |   |   |   |   |   |
|       as      a percentage of average total assets          |   |                        | 14.82  | %      |   |   | 14.18  | %      |   |   | 12.98 | % |
|                                                                                      |   |                        |   |   |   |   |   |   |   |   |   |   |
| Dividend payout ratio (cash      dividends per share                                      |   |                        |   |   |   |   |   |   |   |   |   |   |
|    as a percentage      of net income per share):                          |   |                        |   |   |   |   |   |   |   |   |   |   |
|        Basic                                           |   |                        | 77.52  | %      |   |   | 35.32  | %      |   |   | 29.75 | % |
|        Diluted                                         |   |                        | 78.74  | %      |   |   | 36.96  | %      |   |   | 30.77 | % |

----

| ·  | transaction      processing;                                              |
|--------------|---------------------------------------------------------------------------|
| ·  | operational      and financial management; and                            |
| ·  | training,      integrating and managing Capitol's growing employee  base. |

----

| ·  | adequate      capital and financial condition;                               |
|--------------|------------------------------------------------------------------------------|
| ·  | permissible      types and amounts of extensions of credit and  investments; |
| ·  | permissible      nonbanking activities; and                                  |
| ·  | restrictions      on dividend payments.                                      |

----

----

----

----

----

----

----

| A.  | Market      Information: |
|----------|--------------------------|

| B.  | Holders: |
|----------|----------|

| C.  | Dividends: |
|----------|------------|

| D.  | Securities      Authorized for Issuance Under Equity Compensation  Plan: |
|----------|--------------------------------------------------------------------------|

|                                                          |   | (a)                                                                                                                          |   | (b)                                                                                                                                 |   | (c)                                                                                                                                                                              |
|--------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Plan      category                                                 |   |   Number      of securities tobe      issued upon exerciseof      outstanding options,warrants      and rights (1) |   | Weighted-averageexercise      price ofoutstanding  optionswarrants      and rights (1)                                    |   | Number      of securitiesremaining      available forfuture      issuance under equitycompensation      plans(excluding      securities reflectedin      column (a))             |
|                                                               |   |                                                                                                                         |   |                                                                                                                                |   |                                                                                                                                                                             |
| Equity      compensation plans approved by security holders*       |   |               1,951,757                                |   |                  $       29.52            |   |                         115,417                                                        |
| Equity      compensation plans not approved by security holders(1) |   |                    44,830     |   |                           20.95 |   |                              -- |
| Equity      compensation plans resulting from share exchanges      |   |                  463,495                |   |                      20.22      |   |                              -- |
|                                                               |   |                                                                                                                         |   |                                                                                                                                |   |                                                                                                                                                                             |
| Total                                                              |   |               2,460,082                                |   |                  $  27.85                 |   |                    115,417                                                        |

| (1)     | Stock      options issued pursuant to employment agreements with various officers of      Capitol and its subsidiaries.                                                                                                |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  * | Does not include shares of Capitol's common stock      that may be issued if Capitol elects to pay awards made under the Capitol      Bancorp Ltd. Management Incentive Plan in shares of Capitol's common      stock. |

| E. | Performance      Graph.  Incorporated by reference from Page F-3, Financial      Information Section of Annual Report, under the caption "Information      Regarding Capitol's CommonStock." |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| F.  | There      were no purchases of equity securities by the issuer or affiliated      purchasers in the fourth quarter of2007. |
|----------|-----------------------------------------------------------------------------------------------------------------------------|

| G. | 42,833      shares of Capitol's common stock subject to a restricted stock award made      to Joseph D. Reid, Capitol's Chairman and CEO, pursuant to the terms of      the Capitol Bancorp Limited Management Incentive Plan vested on January 1,      2007, resulting from the satisfaction of certain performance      targets.  The shares were not registered under the Securities      Act of 1933. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

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| CAPITOL      BANCORP LTD.RegistrantBy:   /s/ Joseph D.      Reid                                           Joseph D. ReidChairman andChief Executive      Officer |   By:   /s/ Lee W.      Hendrickson                                      Lee W. HendricksonChief Financial      Officer(Principal Financial      andAccounting    Officer) |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| /s/ Joseph D.      Reid                                                    Joseph      D. Reid, Chairman,Chief      Executive Officer and Director  | /s/ Michael L.      Kasten                                              Michael      L. Kasten, Vice Chairman andDirector                                                                    |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| /s/ David      O’Leary                                                    David      O'Leary, Secretary and Director                               | /s/ David L.      Becker                                                  David      L. Becker, Director                                                       |
| /s/ Lyle W.      Miller                                                     Lyle      W. Miller, Vice Chairman andDirector                     | /s/ Michael J.      Devine                                                    Michael      J. Devine, Director                                                                               |
| /s/ Paul R.      Ballard                                                     Paul      R. Ballard, Director                                    | /s/ Gary A.      Falkenberg                                                 Gary      A. Falkenberg, Director                                                                                               |
| /s/ Douglas E.      Crist                                                  Douglas      E. Crist, Director                                                    | /s/ Kathleen A.      Gaskin                                                 Kathleen      A. Gaskin, Director                                                                                          |
| /s/ James C.      Epolito                                                 James      C. Epolito, Director                                                     | /s/ Michael F.      Hannley                                                 Michael      F. Hannley, Director                                                                                          |
| /s/ Joel I.      Ferguson                                                  Joel      I. Ferguson, Director                                                    | /s/ Richard A.      Henderson                                       Richard      A. Henderson, Director                                                                                                                    |
| /s/ H. Nicholas      Genova                                           H.      Nicholas Genova, Director                                                                                          | /s/ John S.      Lewis                                                      John      S. Lewis, President of BankPerformance      and Director  |
| /s/ Lewis D.      Johns                                                   Lewis      D. Johns, Director                                             | /s/ Cristin K.      Reid                                                     Cristin      K. Reid, Corporate President andDirector                   |
| /s/ Leonard      Maas                                                     Leonard      Maas, Director                                          | /s/ Ronald K.      Sable                                                  Ronald      K. Sable, Director                                                                 |
| /s/ Myrl D.      Nofziger                                                 Myrl      D. Nofziger, Director                                                          |                                                                                                                                                                                                                                                                                                                                                                                            |

----

|   Exhibit      No. |   |   Description                                                                                                                                                                                                                                                                         | Page      Number orIncorporated      byReference      from:                                     |
|------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------|
| 3                            |   | Articles      of Incorporation (as amended) and Bylaws (as amended)                                                                                                                                                                                                                             |  (1)      (22) (24)                                                                             |
| 4                            |   | Instruments      Defining the Rights of Security Holders                                                                                                                                                                                                                                        |                                                                                                 |
|                         | (a)    | Common      Stock Certificate                                                                                                                                                                                                                                                                   |                 (1)  |
|                         | (b)    | Indenture      dated December 18, 1997                                                                                                                                                                                                                                                          |               (11)             |
|                         | (c)    | Subordinated      Debenture                                                                                                                                                                                                                                                                     |               (11)             |
|                         | (d)    | Amended      and Restated Trust Agreement dated December 18, 1997                                                                                                                                                                                                                               |               (11)             |
|                         | (e)    | Preferred      Security Certificate dated December 18, 1997                                                                                                                                                                                                                                     |               (11)             |
|                         | (f)    | Preferred      Securities Guarantee Agreement of Capitol Trust I dated December 18,      1997                                                                                                                                                                                                   |                (11)       |
|                         | (g)    | Agreement      as to Expenses and Liabilities of Capitol Trust I                                                                                                                                                                                                                                |               (11)             |
|                         | (h)    | Capitol      Bancorp Ltd. 2000 Incentive Stock Plan                                                                                                                                                                                                                                             |               (18)             |
| 10                           |   | Material      Contracts:                                                                                                                                                                                                                                                                        |                                                                                                 |
|                         |   | Capitol      Bancorp Limited 2003 Stock Plan*                                                                                                                                                                                                                                                   |        (20)      (22)                                             |
|                         |   | Form      of Stock Option Agreement for Awards pursuant to Capitol Bancorp Limited      2003 Stock Plan*                                                                                                                                                                                        |                (20)       |
|                         | (a)    | Amended      and Restated Employment Agreement of Joseph D. Reid (dated March 17, 2003      and amendment dated April 17, 2003)*                                                                                                                                                                |                (19)       |
|                         | (b)    | Profit      Sharing/401(k) Plan (as amended and restated April 1,    1995)*                                                                                                                                                                                                                     |               (10)             |
|                         | (b1)   | First      and Second Amendments to Profit Sharing/401(k) Plan*                                                                                                                                                                                                                                 |               (12)             |
|                         | (b2)   | Third,      Fourth and Fifth Amendments to Profit Sharing/401(k) Plan*                                                                                                                                                                                                                          |               (14)             |
|                         | (b3)   | Sixth,      Seventh, Eighth and Ninth Amendments to Profit Sharing/401(k)Plan*                                                                                                                                                                                                                  |                (15)       |
|                         | (b4)   | Tenth,      Eleventh, Twelfth, Thirteenth, Fourteenth and Fifteenth Amendments to      Profit Sharing/401(k) Plan*                                                                                                                                                                              |                (17)       |
|                         | (b5)   | Sixteenth      and Seventeenth Amendments to Profit Sharing/401(k) Plan*                                                                                                                                                                                                                        |               (18)             |
|                         | (b6)   | Eighteenth,      Nineteenth and Twentieth Amendments to Profit Sharing/401(k)      Plan*                                                                                                                                                                                                        |                (21)       |
|                         | (b7)   | Twenty-First,      Twenty-Second, Twenty-Third, Twenty-Fourth, Twenty-Fifth and Twenty-Sixth      Amendments to Profit Sharing/401(k) Plan*                                                                                                                                                     |                (23)       |
|                         | (b8)   | Twenty-Seventh,      Twenty-Eighth, Twenty-Ninth, Thirtieth, Thirty-First, Thirty-Second,      Thirty-Third, Thirty-Fourth, Thirty-Fifth, Thirty-Sixth, Thirty-Seventh,      Thirty-Eighth, Thirty-Ninth, Fortieth, Forty-First and Forty-Second      Amendments to Profit Sharing/401(k) Plan* |                 (25) |
|                         | (b9)   | Forty-Third,      Forty-Fourth, Forty-Fifth, Forty-Sixth, Forty-Seventh, Forty-Eighth,      Forty-Ninth, Fiftieth, Fifty-First, Fifty-Second, Fifty-Third,      Fifty-Fourth and Fifty-Fifth Amendments to Profit Sharing/401(k)      Plan*                                                     |                                                                                                 |

----

|   Exhibit      No. |   |   Description                                                                                                                                                                                                            | Page      Number orIncorporated      byReference      from:                                          |
|------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------|
| 10                           |   | Material      Contracts—continued:                                                                                                                                                                                           |                                                                                                      |
|                         | (c)    | Lease      Agreement with Business & Trade Center, Ltd.                                                                                                                                                                        |                 (9)       |
|                         | (d)    | Capitol      Bancorp Ltd Employee Stock Ownership Plan (as amended and restated January      1, 2008) and Amendment No.      1 thereto*                                                                                            |                                                                                                      |
|                         | (e)    | Employment      Agreements with John C. Smythe and Charles J. McDonald*                                                                                                                                                            |                 (2)       |
|                         | (f)    | Executive      Supplemental Income Agreements with Paul R. Ballard, Richard G. Dorner,      James R. Kaye, Scott G. Kling, David K. Powers, John C. Smythe and Charles      J. McDonald*                                           |                 (10)      |
|                         | (g)    | Consolidation      Agreement between the Corporation and PortageCommerce      Bank                                                                                                                                                 |                  (4) |
|                         | (h)    | Employment      Agreement with Richard G. Dorner*                                                                                                                                                                                  |                 (4)       |
|                         | (i)    | Employment      Agreement with David K. Powers*                                                                                                                                                                                    |                 (5)       |
|                         | (j)    | Definitive      Exchange Agreement and Closing Memorandum between Capitol and United      Savings Bank, FSB                                                                                                                        |                  (6) |
|                         | (k)    | Employment      Agreement with James R. Kaye*                                                                                                                                                                                      |                 (7)       |
|                         | (l)    | Definitive      Exchange Agreement between the Registrant and Financial Center      Corporation                                                                                                                                    |                  (8) |
|                         | (m)    | Capitol      Bancorp Ltd. Management Incentive Plan*                                                                                                                                                                               |               (22)                  |
|                         | (n)    | Employment      Agreement by and between Sun Community Bancorp Limited and John S.      Lewis.  (Exhibit 10.7 of Sun Community BancorpLimited)*                                                                          |                 (13)      |
|                         | (o)    | Anti-dilution      Agreement by and between Sun Community Bancorp Limited and Capitol Bancorp      Ltd.  (Exhibit 10.10 of Sun CommunityBancorp      Limited)                                                            |                 (13)      |
|                         | (p)    | Plan      of Share Exchange dated November 16, 2001 between and among Capitol      Bancorp Ltd. and Sun Community Bancorp Limited                                                                                                  |                (16)            |
|                         | (q)    | Restricted      Stock Agreement between Capitol Bancorp Ltd. and JosephD.      Reid*                                                                                                                                               |                (23)            |
|                         | (r)    | Form      of Employment Agreement with Cristin K. Reid and Bruce Thomas (and,      effective March 2008, Lee W. Hendrickson and John S.    Lewis)*                                                                                 |                (23)            |
|                         | (s)    | Second      Amendment to Employment Agreement with Joseph D. Reid (dated March 14,      2007)*                                                                                                                                     |                                                                                                      |
| 13                           |   | Annual      Report to Security HoldersA.       Marketing      Section of 2007 Annual ReportB.       Financial      Information Section of 2007 Annual Report |                                                                                                      |
| 21                           |   | Subsidiaries      of the Registrant                                                                                                                                                                                                |                                                                                                      |
| 23                           |   | Consent      of BDO Seidman, LLP                                                                                                                                                                                                   |                                                                                                      |
| 31.1                         |   | Certification      of Chief Executive Officer, Joseph D. Reid, pursuant to Section 302 of the      Sarbanes-Oxley Act of 2002.                                                                                                     |                                                                                                      |
| 31.2                         |   | Certification      of Chief Financial Officer, Lee W. Hendrickson, pursuant to Section 302 of      the Sarbanes-Oxley Act of 2002.                                                                                                 |                                                                                                      |

----

|   Exhibit      No. |   |   Description                                                                                                          | Page      Number orIncorporated      byReference      from:  |
|------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------|
| 32.1                         |   | Certification      of Chief Executive Officer, Joseph D. Reid, pursuant toSection      906 of the Sarbanes-Oxley Act of 2002.    |                                                              |
| 32.2                         |   | Certification      of Chief Financial Officer, Lee W. Hendrickson, pursuantto      Section 906of the Sarbanes-Oxley Act of 2002. |                                                              |

|          |                                                                                                                                                                                                                                                                                                         |
|---------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Key:          |                                                                                                                                                                                                                                                                                                         |
| (1)           | Form      S-18, Reg. No. 33-24728C, filed September 15, 1988.                                                                                                                                                                                                                                                |
| (2)           | Form      S-1, Reg. No. 33-30492, filed August 14, 1989.                                                                                                                                                                                                                                                     |
| (3)           | Form      S-1, Reg. No. 33-31323, filed September 29, 1989.                                                                                                                                                                                                                                                  |
| (4)           | Originally      filed as exhibit to Form 10-K for year ended December 31, 1990, filed      March 6, 1991; refiledas      exhibit to Form 10-KSB for year ended December 31, 1995, filed March 14,      1996, due to time limitfor      incorporation by reference pursuant to Regulation SB Item      10(f). |
| (5)           | Form      10-K for year ended December 31, 1991, filed February 28,      1992.                                                                                                                                                                                                                               |
| (6)           | Form      8-K dated July 15, 1992, as amended under Form 8 on September 14,      1992.                                                                                                                                                                                                                       |
| (7)           | Form      10-KSB for year ended December 31, 1992, filed February 25,      1993.                                                                                                                                                                                                                             |
| (8)           | Form      S-4, Reg. No. 33-73474, filed December 27, 1993.                                                                                                                                                                                                                                                   |
| (9)           | Form      10-KSB for year ended December 31, 1993, filed March 14,    1994.                                                                                                                                                                                                                                  |
| (10)          | Form      10-KSB for the year ended December 31, 1995, filed March 14,      1996.                                                                                                                                                                                                                            |
| (11)          | Post      Effective Amendment No.1 to Form S-3, Reg. No. 333-41215 and 333-41215-01      filed February 9, 1998.                                                                                                                                                                                             |
| (12)          | Form      10-K for year ended December 31, 1998, filed March 17,    1999.                                                                                                                                                                                                                                    |
| (13)          | Amendment      No. 2 to the Registration Statement on Form S-1 of Sun Community Bancorp      Limited(Registration      No. 333-76719) dated June 15, 1999.                                                                                                                                                   |
| (14)          | Form      10-K for year ended December 31, 1999, filed March 27,    2000.                                                                                                                                                                                                                                    |
| (15)          | Form      10-K for year ended December 31, 2000, filed March 23,    2001.                                                                                                                                                                                                                                    |
| (16)          | Amendment      No. 4 to the Registration Statement on Form S-4 Reg. No. 333-73624 filed      February 12, 2002.                                                                                                                                                                                              |
| (17)          | Form      10-K for year ended December 31, 2001, filed March 15,    2002.                                                                                                                                                                                                                                    |
| (18)          | Form      10-K for year ended December 31, 2002, filed March 28,    2003.                                                                                                                                                                                                                                    |
| (19)          | Form      10-Q for the period ended March 31, 2003, filed May 14,    2003.                                                                                                                                                                                                                                   |
| (20)          | Form      10-Q for the period ended September 30, 2004, filed October 29,      2004.                                                                                                                                                                                                                         |
| (21)          | Form      10-K for the year ended December 31, 2004, filed March 16,      2005.                                                                                                                                                                                                                              |
| (22)          | Form      10-Q for the period ended June 30, 2005, filed July 29,    2005.                                                                                                                                                                                                                                   |
| (23)          | Form      10-K for the year ended December 31, 2005, filed March 16,      2006.                                                                                                                                                                                                                              |
| (24)          | Exhibit      99.1 to Form 8-K filed on February 7, 2007.                                                                                                                                                                                                                                                     |
| (25)          | Form      10-K for the year ended December 31, 2006, filed March 16,      2007.                                                                                                                                                                                                                              |
|   * | A      management contract or compensatory plan required to be filed with this      report.                                                                                                                                                                                                                  |

----