----

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| T      | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE             |
|--------|---------------------------------------------------------------------|
|   | SECURITIES EXCHANGE ACT OF 1934                                     |
|   | For the quarterly period ended March 31, 2011                       |
|   | OR                                                                  |
| £ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE            |
|   | SECURITIES EXCHANGE ACT OF 1934                                     |
|   |                                                                |
|   | For the transition period from ________________ to ________________ |

| Michigan                                 |   | 38-2761672                        |
|------------------------------------------|--------|-----------------------------------|
| (State or other jurisdiction of          |   | (IRS Employer Identification No.) |
| incorporation or organization)           |   |                              |
| Capitol Bancorp Center                   |   |                              |
| Fourth Floor                             |   |                              |
| 200 N. Washington Square                 |   |                              |
| Lansing, Michigan                        |   | 48933                             |
| (Address of principal executive offices) |   | (Zip Code)                        |

| Yes   T | No   £ |
|------------------------|----------------------------|

| Yes   £ | No   £ |
|-----------------------------|----------------------------|

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

| Yes   £ | No   T |
|-----------------------------|-----------------------|

| Class                      |   | Outstanding at April 30, 2011 |
|----------------------------|--------|-------------------------------|
| Common Stock, No par value |   | 41,122,057 shares             |

----

----

----

----

|  Item 1.       |  Financial Statements (unaudited):                                                                   | Page     |
|---------------------|-----------------------------------------------------------------------------------------------------------|----------|
|                | Condensed consolidated balance sheets – March 31, 2011 and December 31, 2010.                       | 6        |
|                | Condensed consolidated statements of operations – Three months endedMarch 31, 2011 and 2010.        | 7        |
|                | Condensed consolidated statements of changes in equity – Three months endedMarch 31, 2011 and 2010. | 8        |
|                | Condensed consolidated statements of cash flows – Three months ended March 31,2011 and 2010.        | 9        |
|                | Notes to condensed consolidated financial statements.                                                     | 10       |
| Item 2.             | Management's Discussion and Analysis of Financial Condition and Results of Operations.                    | 30       |
| Item 3.             | Quantitative and Qualitative Disclosures About Market Risk.                                               | 49       |
| Item 4.             | Controls and Procedures.                                                                                  | 49       |
|  PART II.      |  OTHER INFORMATION                                                                                   |     |
|  Item 1.       |  Legal Proceedings.                                                                                  |  50 |
| Item 1A.            | Risk Factors.                                                                                             | 50       |
| Item 2.             | Unregistered Sales of Equity Securities and Use of Proceeds.                                              | 50       |
| Item 3.             | Defaults Upon Senior Securities.                                                                          | 50       |
| Item 4.             | [Removed and Reserved.]                                                                                   | 50       |
| Item 5.             | Other Information.                                                                                        | 50       |
| Item 6.             | Exhibits.                                                                                                 | 55       |
|  SIGNATURES    |                                                                                                      |  56 |
|  EXHIBIT INDEX |                                                                                                      |  57 |

----

| PART I, ITEM 1                                                                                                                                                                                                                                                                                                                   |                               |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------|
|                                                                                                                                                                                                                                                                                                                             |                               |
| CAPITOL BANCORP LIMITED                                                                                                                                                                                                                                                                                                          |                               |
| Condensed Consolidated Balance Sheets                                                                                                                                                                                                                                                                                            |                               |
| As of March 31, 2011 and December 31, 2010                                                                                                                                                                                                                                                                                       |                               |
| (in $1,000s, except share and per-share data)                                                                                                                                                                                                                                                                                    |                               |
|                                                                                                                                                                                                                                                                                                                             |                               |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                             |                               |   | (Unaudited) |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                             |                               |   | March 31, |   |   | December 31, |   |
|                                                                                                                                                                                                                                                                                                                             |                               |   | 2011 |   |   | 2010 |   |
| ASSETS                                                                                                                                                                                                                                                                                                                           |                               |   |   |   |   |   |   |
| Cash and due from banks                                                                                                                                                                                                                                                                                                          |                               |   | $ | 77,008 |   |   | $ | 56,709 |   |
| Money market and interest-bearing deposits                                                                                                                                                                                                                                                                                       |                               |   |   | 459,002 |   |   |   | 477,639 |   |
| Federal funds sold                                                                                                                                                                                                                                                                                                               |                               |   |   | 484 |   |   |   | 413 |   |
|                                                                                                                                                                                                                                                                                                                             | Cash and cash equivalents          |   |   | 536,494 |   |   |   | 534,761 |   |
| Loans held for sale                                                                                                                                                                                                                                                                                                              |                               |   |   | 1,710 |   |   |   | 6,900 |   |
| Investment securities -- Note C:                                                                                                                                                                                                                                                                                                 |                               |   |   |   |   |   |   |   |   |
|    Available for sale, carried at fair value                                                                                                                                                                                                                                                                      |                               |   |   | 20,954 |   |   |   | 17,482 |   |
|    Held for long-term investment, carried at                                                                                                                                                                                                                                                                      |                               |   |   |   |   |   |   |   |   |
|      amortized cost which approximates fair value                                                                                                                                                                                                                                                       |                               |   | 2,330 |   |   |   | 2,893 |   |
|                                                                                                                                                                                                                                                                                                                             | Total investment securities        |   |   | 23,284 |   |   |   | 20,375 |   |
| Federal Home Loan Bank and Federal Reserve                                                                                                                                                                                                                                                                                       |                               |   |   |   |   |   |   |   |
|   Bank stock (carried on the basis of cost) -- Note C                                                                                                                                                                                                                                                                  |                               |   | 17,811 |   |   |   | 17,001 |   |
| Portfolio loans -- Note D:                                                                                                                                                                                                                                                                                                       |                               |   |   |   |   |   |   |   |   |
|    Loans secured by real estate:                                                                                                                                                                                                                                                                                  |                               |   |   |   |   |   |   |   |   |
|     Commercial                                                                                                                                                                                                                                                                                               |                               |   |   | 1,346,584 |   |   |   | 1,374,791 |   |
|     Residential (including multi-family)                                                                                                                                                                                                                                                                     |                               |   |   | 497,315 |   |   |   | 518,943 |   |
|     Construction, land development and other land                                                                                                                                                                                                                                                            |                               |   | 216,993 |   |   |   | 230,788 |   |
|                                                                                                                                                                                                                                                                                                                             | Total loans secured by real estate |   |   | 2,060,892 |   |   |   | 2,124,522 |   |
|    Commercial and other business-purpose loans                                                                                                                                                                                                                                                                    |                               |   | 350,873 |   |   |   | 375,968 |   |
|    Consumer                                                                                                                                                                                                                                                                                                       |                               |   |   | 22,066 |   |   |   | 23,375 |   |
|    Other                                                                                                                                                                                                                                                                                                          |                               |   |   | 16,890 |   |   |   | 15,133 |   |
|                                                                                                                                                                                                                                                                                                                             | Total portfolio loans              |   |   | 2,450,721 |   |   |   | 2,538,998 |   |
|    Less allowance for loan losses                                                                                                                                                                                                                                                                                 |                               |   |   | (136,681 | ) |   |   | (144,985 | ) |
|                                                                                                                                                                                                                                                                                                                             | Net portfolio loans                |   |   | 2,314,040 |   |   |   | 2,394,013 |   |
| Premises and equipment                                                                                                                                                                                                                                                                                                           |                               |   |   | 34,212 |   |   |   | 35,203 |   |
| Accrued interest income                                                                                                                                                                                                                                                                                                          |                               |   |   | 8,526 |   |   |   | 8,628 |   |
| Other real estate owned                                                                                                                                                                                                                                                                                                          |                               |   |   | 110,829 |   |   |   | 106,835 |   |
| Other assets                                                                                                                                                                                                                                                                                                                     |                               |   |   | 15,555 |   |   |   | 17,965 |   |
| Assets of discontinued operations -- Note E                                                                                                                                                                                                                                                                                      |                               |   |   | 134,501 |   |   |   | 398,533 |   |
|                                                                                                                                                                                                                                                                                                                             |                               |   |   |   |   |   |   |   |   |
|             TOTAL ASSETS                                                                                                                                                                                                                                             |                               |   | $ | 3,196,962 |   |   | $ | 3,540,214 |   |
|                                                                                                                                                                                                                                                                                                                             |                               |   |   |   |   |   |   |   |   |
| LIABILITIES AND EQUITY                                                                                                                                                                                                                                                                                                           |                               |   |   |   |   |   |   |   |   |
| LIABILITIES:                                                                                                                                                                                                                                                                                                                     |                               |   |   |   |   |   |   |   |   |
| Deposits:                                                                                                                                                                                                                                                                                                                        |                               |   |   |   |   |   |   |   |   |
|    Noninterest-bearing                                                                                                                                                                                                                                                                                            |                               |   | $ | 531,455 |   |   | $ | 500,809 |   |
|    Interest-bearing                                                                                                                                                                                                                                                                                               |                               |   |   | 2,276,515 |   |   |   | 2,373,492 |   |
|                                                                                                                                                                                                                                                                                                                             | Total deposits                     |   |   | 2,807,970 |   |   |   | 2,874,301 |   |
| Debt obligations:                                                                                                                                                                                                                                                                                                                |                               |   |   |   |   |   |   |   |   |
|    Notes payable and other borrowings                                                                                                                                                                                                                                                                             |                               |   |   | 106,052 |   |   |   | 117,377 |   |
|    Subordinated debentures -- Note I                                                                                                                                                                                                                                                                              |                               |   |   | 149,080 |   |   |   | 167,586 |   |
|                                                                                                                                                                                                                                                                                                                             | Total debt obligations             |   |   | 255,132 |   |   |   | 284,963 |   |
| Accrued interest on deposits and other liabilities                                                                                                                                                                                                                                                                               |                               |   | 48,049 |   |   |   | 50,271 |   |
| Liabilities of discontinued operations -- Note E                                                                                                                                                                                                                                                                                 |                               |   | 124,799 |   |   |   | 369,360 |   |
|                                                                                                                                                                                                                                                                                                                             | Total liabilities                  |   |   | 3,235,950 |   |   |   | 3,578,895 |   |
|                                                                                                                                                                                                                                                                                                                             |                               |   |   |   |   |   |   |   |   |
| EQUITY:                                                                                                                                                                                                                                                                                                                          |                               |   |   |   |   |   |   |   |   |
| Capitol Bancorp Limited stockholders' equity -- Notes G and L:                                                                                                                                                                                                                                                                   |                               |   |   |   |   |   |   |   |
|   Preferred stock (Series A), 700,000 shares authorized                                                                                                                                                                                                                                                                |                               |   |   |   |   |   |   |   |
|       ($100 per-share liquidation preference); 50,980 shares                                                                                                                                                                                                                                       |                               |   |   |   |   |   |   |   |
|       issued and outstanding                                                                                                                                                                                                                                                                       |                               |   |   | 5,098 |   |   |   |   |   |
|   Preferred stock (for potential future issuance),                                                                                                                                                                                                                                                                     |                               |   |   |   |   |   |   |   |
|     19,300,000 shares authorized (none issued and outstanding)                                                                                                                                                                                                                                               |                               |   | -- |   |   |   | -- |   |
|   Common stock, no par value, 1,500,000,000 shares authorized;                                                                                                                                                                                                                                                         |                               |   |   |   |   |   |   |   |
|      issued and outstanding:  2011 - 41,122,757 shares                                                                                                                                                                                                                                             |                               |   |   |   |   |   |   |   |
|                                                    2010 - 21,614,856 shares |                               |   | 292,354 |   |   |   | 287,190 |   |
|   Retained-earnings deficit                                                                                                                                                                                                                                                                                            |                               |   |   | (353,468 | ) |   |   | (353,757 | ) |
|   Undistributed common stock held by employee-benefit trust                                                                                                                                                                                                                                                            |                               |   | (541 | ) |   |   | (541 | ) |
|   Fair value adjustment (net of tax effect) for investment securities                                                                                                                                                                                                                                                  |                               |   |   |   |   |   |   |   |
|      available for sale (accumulated other comprehensive income)                                                                                                                                                                                                                                        |                               |   | 132 |   |   |   | 156 |   |
| Total Capitol Bancorp Limited stockholders' equity deficit                                                                                                                                                                                                                                                                       |                               |   | (56,425 | ) |   |   | (61,854 | ) |
| Noncontrolling interests in consolidated subsidiaries                                                                                                                                                                                                                                                                            |                               |   | 17,437 |   |   |   | 23,173 |   |
|                                                                                                                                                                                                                                                                                                                             | Total equity deficit               |   |   | (38,988 | ) |   |   | (38,681 | ) |
|                                                                                                                                                                                                                                                                                                                             |                               |   |   |   |   |   |   |   |   |
|             TOTAL LIABILITIES AND EQUITY                                                                                                                                                                                                                             |                               | $ | 3,196,962 |   |   | $ | 3,540,214 |   |
|                                                                                                                                                                                                                                                                                                                             |                               |   |   |   |   |   |   |   |   |
| See notes to condensed consolidated financial statements.                                                                                                                                                                                                                                                                        |                               |   |   |   |   |   |   |   |

----

| CAPITOL BANCORP LIMITED                                                                                                                                                                                                               |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Condensed Consolidated Statements of Operations (Unaudited)                                                                                                                                                                           |
| For the Three Months Ended March 31, 2011 and 2010                                                                                                                                                                                    |
| (in $1,000s, except per share data)                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                  |   |   |   |
|                                                                                                                                                                                                                                  | 2011 |   |   | 2010 |   |
| Interest income:                                                                                                                                                                                                                      |   |   |   |   |   |   |
|   Portfolio loans (including fees)                                                                                                                                                                                          |   | $ | 34,792 |   |   | $ | 41,796 |   |
|   Loans held for sale                                                                                                                                                                                                       |   |   | 29 |   |   |   | 60 |   |
|   Taxable investment securities                                                                                                                                                                                             |   |   | 54 |   |   |   | 222 |   |
|   Federal funds sold                                                                                                                                                                                                        |   |   | 2 |   |   |   | 5 |   |
|   Other                                                                                                                                                                                                                     |   |   | 454 |   |   |   | 485 |   |
| Total interest income                                                                                                                                                                                                                 |   |   | 35,331 |   |   |   | 42,568 |   |
| Interest expense:                                                                                                                                                                                                                     |   |   |   |   |   |   |   |   |
|   Deposits                                                                                                                                                                                                                  |   |   | 8,027 |   |   |   | 13,300 |   |
|   Debt obligations and other                                                                                                                                                                                                |   |   | 3,113 |   |   |   | 4,428 |   |
| Total interest expense                                                                                                                                                                                                                |   |   | 11,140 |   |   |   | 17,728 |   |
| Net interest income                                                                                                                                                                                                                   |   |   | 24,191 |   |   |   | 24,840 |   |
| Provision for loan losses -- Note D                                                                                                                                                                                                   |   |   | 13,467 |   |   |   | 47,364 |   |
| Net interest income (deficiency) after                                                                                                                                                                                                |   |   |   |   |   |
|                                   provision for loan losses |   |   | 10,724 |   |   |   | (22,524 | ) |
| Noninterest income:                                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|   Service charges on deposit accounts                                                                                                                                                                                       |   |   | 905 |   |   |   | 978 |   |
|   Trust and wealth-management revenue                                                                                                                                                                                       |   |   | 944 |   |   |   | 1,152 |   |
|   Fees from origination of non-portfolio residential                                                                                                                                                                        |   |   |   |   |   |   |   |   |
|      mortgage loans                                                                                                                                                                                          |   |   | 268 |   |   |   | 382 |   |
|   Gain on sale of government-guaranteed loans                                                                                                                                                                               |   |   | 527 |   |   |   | 113 |   |
|   Gain on exchange of trust-preferred securities for                                                                                                                                                                        |   |   |   |   |   |   |   |   |
|      common stock -- Note I                                                                                                                                                                                  |   |   | 16,861 |   |   |   | -- |   |
|   Gain on exchange of promissory notes for common                                                                                                                                                                           |   |   |   |   |   |   |   |   |
|      stock                                                                                                                                                                                                   |   |   | -- |   |   |   | 1,255 |   |
|   Realized gain on sale of investment securities available                                                                                                                                                                       |   |   |   |   |   |
|      for sale                                                                                                                                                                                                |   |   | -- |   |   |   | 14 |   |
|   Other                                                                                                                                                                                                                     |   |   | 1,887 |   |   |   | 2,330 |   |
| Total noninterest income                                                                                                                                                                                                              |   |   | 21,392 |   |   |   | 6,224 |   |
| Noninterest expense:                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |
|   Salaries and employee benefits                                                                                                                                                                                            |   |   | 15,529 |   |   |   | 18,223 |   |
|   Occupancy                                                                                                                                                                                                                 |   |   | 3,612 |   |   |   | 3,751 |   |
|   Equipment rent, depreciation and maintenance                                                                                                                                                                              |   |   | 2,187 |   |   |   | 2,669 |   |
|   Costs associated with foreclosed properties and other                                                                                                                                                                     |   |   |   |   |   |   |   |   |
|      real estate owned                                                                                                                                                                                       |   |   | 7,497 |   |   |   | 11,593 |   |
|   FDIC insurance premiums and other regulatory fees                                                                                                                                                                         |   |   | 3,296 |   |   |   | 4,134 |   |
|   Other                                                                                                                                                                                                                     |   |   | 7,800 |   |   |   | 6,691 |   |
| Total noninterest expense                                                                                                                                                                                                             |   |   | 39,921 |   |   |   | 47,061 |   |
| Loss before income tax benefit                                                                                                                                                                                                        |   |   | (7,805 | ) |   |   | (63,361 | ) |
| Income tax benefit                                                                                                                                                                                                                    |   |   | (2,135 | ) |   |   | (482 | ) |
| Loss from continuing operations                                                                                                                                                                                                       |   |   | (5,670 | ) |   |   | (62,879 | ) |
| Discontinued operations -- Note E:                                                                                                                                                                                                    |   |   |   |   |   |   |   |   |
|   Income from operations of bank subsidiaries sold                                                                                                                                                                          |   |   | 16 |   |   |   | 1,533 |   |
|   Gain on sale of bank subsidiaries                                                                                                                                                                                         |   |   | 4,368 |   |   |   | -- |   |
|   Less income tax expense                                                                                                                                                                                                   |   |   | 1,488 |   |   |   | 594 |   |
| Income from discontinued operations                                                                                                                                                                                                   |   |   | 2,896 |   |   |   | 939 |   |
| NET LOSS                                                                                                                                                                                                                              |   |   | (2,774 | ) |   |   | (61,940 | ) |
| Net losses attributable to noncontrolling interests in                                                                                                                                                                                |   |   |   |   |   |   |   |   |
|   consolidated subsidiaries                                                                                                                                                                                                 |   |   | 3,063 |   |   |   | 14,058 |   |
|                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |
| NET INCOME (LOSS) ATTRIBUTABLE TO CAPITOL                                                                                                                                                                                             |   |   |   |   |   |   |   |   |
|       BANCORP LIMITED                                                                                                                                                                                   |   | $ | 289 |   |   | $ | (47,882 | ) |
|                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |
| NET INCOME (LOSS) PER COMMON SHARE ATTRIBUTABLE                                                                                                                                                                                       |   |   |   |   |   |
|       TO CAPITOL BANCORP LIMITED -- Note H                                                                                                                                                              |   | $ | 0.01 |   |   | $ | (2.75 | ) |
|                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |
| See notes to condensed consolidated financial statements.                                                                                                                                                                             |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                  |   |   |   |   |   |   |   |   |

----

----

| CAPITOL BANCORP LTD.                                                                                                                       |
|--------------------------------------------------------------------------------------------------------------------------------------------|
| Condensed Consolidated Statements of Cash Flows (Unaudited)                                                                                |
| For the Three Months Ended March 31, 2011 and 2010                                                                                         |
| (in $1,000s)                                                                                                                               |
|                                                                                                                                       |   |   |   |   |   |   |
|                                                                                                                                       |   | 2011 |   |   | 2010 |   |
|                                                                                                                                       |   |   |   |   |   |   |
| OPERATING ACTIVITIES                                                                                                                       |   |   |   |   |   |   |
|   Net loss                                                                                                                       |   | $ | (2,774 | ) |   | $ | (61,940 | ) |
|   Adjustments to reconcile net loss to net cash provided                                                                         |   |   |   |   |   |   |   |   |
|     by operating activities (including discontinued operations):                                                       |   |   |   |   |   |   |   |   |
|       Provision for loan losses                                                                              |   |   | 13,961 |   |   |   | 50,100 |   |
|       Depreciation of premises and equipment                                                                 |   |   | 1,597 |   |   |   | 2,199 |   |
|       Amortization of intangibles                                                                            |   |   | -- |   |   |   | 61 |   |
|       Net amortization of investment security premiums                                                       |   |   | 3 |   |   |   | 266 |   |
|       Loss on sale of premises and equipment                                                                 |   |   | 4 |   |   |   | 1 |   |
|       Gain on sale of government-guaranteed loans                                                            |   |   | (786 | ) |   |   | (462 | ) |
|       Gain on sale of bank subsidiaries                                                                      |   |   | (4,368 | ) |   |   | -- |   |
|       Gain on debt extinguishment                                                                            |   |   | (16,861 | ) |   |   | (1,255 | ) |
|       Realized gain on sale of investment securities available for sale                                      |   |   | -- |   |   |   | (14 | ) |
|       Loss on sale of other real estate owned                                                                |   |   | 134 |   |   |   | 1,774 |   |
|       Write-down of other real estate owned                                                                  |   |   | 4,223 |   |   |   | 8,620 |   |
|       Amortization of issuance costs of subordinated debentures                                              |   |   | 25 |   |   |   | 37 |   |
|       Share-based compensation expense                                                                       |   |   | 99 |   |   |   | 223 |   |
|       Deferred income tax credit                                                                             |   |   | (230 | ) |   |   | (267 | ) |
|       Valuation allowance for deferred income tax assets                                                     |   |   | -- |   |   |   | 283 |   |
|   Originations and purchases of loans held for sale                                                                              |   |   | (9,516 | ) |   |   | (29,344 | ) |
|   Proceeds from sales of loans held for sale                                                                                     |   |   | 14,847 |   |   |   | 38,598 |   |
|   Decrease in accrued interest income and other assets                                                                           |   |   | 17,262 |   |   |   | 8,720 |   |
|   Increase (decrease) in accrued interest expense on deposits and                                                                |   |   |   |   |   |   |   |   |
|      other liabilities                                                                                            |   |   | 1,187 |   |   |   | (2,264 | ) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
|                 NET CASH PROVIDED BY OPERATING ACTIVITIES  |   |   | 18,807 |   |   |   | 15,336 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
| INVESTING ACTIVITIES                                                                                                                       |   |   |   |   |   |   |   |   |
|   Proceeds from sales of investment securities available for sale                                                                |   |   | 488 |   |   |   | 23,664 |   |
|   Proceeds from calls, prepayments and maturities of investment                                                                  |   |   |   |   |   |   |   |   |
|      securities                                                                                                   |   |   | 6,766 |   |   |   | 7,164 |   |
|   Purchases of investment securities                                                                                             |   |   | (10,265 | ) |   |   | (2,307 | ) |
|   Redemption of Federal Home Loan Bank stock by issuer                                                                           |   |   | 42 |   |   |   | 225 |   |
|   Purchase of Federal Home Loan Bank stock                                                                                       |   |   | (849 | ) |   |   | (87 | ) |
|   Net decrease in portfolio loans                                                                                                |   |   | 40,531 |   |   |   | 66,679 |   |
|   Proceeds from sales of government-guaranteed loans                                                                             |   |   | 11,628 |   |   |   | 10,570 |   |
|   Proceeds from sales of premises and equipment                                                                                  |   |   | 50 |   |   |   | 112 |   |
|   Purchases of premises and equipment                                                                                            |   |   | (592 | ) |   |   | (254 | ) |
|   Proceeds from sale of bank subsidiaries                                                                                        |   |   | 8,869 |   |   |   | -- |   |
|   Payments received on other real estate owned                                                                                   |   |   | 14 |   |   |   | -- |   |
|   Proceeds from sales of other real estate owned                                                                                 |   |   | 7,988 |   |   |   | 11,605 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
|                 NET CASH PROVIDED BY INVESTING ACTIVITIES  |   |   | 64,670 |   |   |   | 117,371 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
| FINANCING ACTIVITIES                                                                                                                       |   |   |   |   |   |   |   |   |
|   Net increase in demand deposits, NOW accounts and savings accounts                                                             |   |   | 42,353 |   |   |   | 37,607 |   |
|   Net increase (decrease) in certificates of deposit                                                                             |   |   | (112,350 | ) |   |   | 6,121 |   |
|   Net borrowings from debt obligations                                                                                           |   |   | 425 |   |   |   | 56 |   |
|   Proceeds from Federal Home Loan Bank borrowings                                                                                |   |   | 91,350 |   |   |   | 271,380 |   |
|   Payments on Federal Home Loan Bank borrowings                                                                                  |   |   | (103,250 | ) |   |   | (317,135 | ) |
|   Net proceeds from issuance of common stock                                                                                     |   |   | -- |   |   |   | 20 |   |
|   Tax effect of share-based payments                                                                                             |   |   | (17 | ) |   |   | (22 | ) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
|                 NET CASH USED BY FINANCING ACTIVITIES      |   |   | (81,489 | ) |   |   | (1,973 | ) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
|                 INCREASE IN CASH AND CASH EQUIVALENTS      |   |   | 1,988 |   |   |   | 130,734 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
| Change in cash and cash equivalents of discontinued operations                                                                             |   |   | (255 | ) |   |   | (28,947 | ) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
| Cash and cash equivalents at beginning of period                                                                                           |   |   | 534,761 |   |   |   | 667,881 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
|                 CASH AND CASH EQUIVALENTS AT END OF PERIOD |   | $ | 536,494 |   |   | $ | 769,668 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
| Supplemental disclosures:                                                                                                                  |   |   |   |   |   |   |   |   |
|   Cash paid during the period for interest on deposits and debt obligations                                                      |   | $ | 11,914 |   |   | $ | 21,387 |   |
|   Transfers of loans to other real estate owned                                                                                  |   |   | 17,671 |   |   |   | 20,194 |   |
|   Surrender of common stock to facilitate vesting of restricted stock                                                            |   |   | -- |   |   |   | 2 |   |
|   Exchange of common stock for redemption of debt                                                                                |   |   | 5,082 |   |   |   |  3,325 |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |
| See notes to condensed consolidated financial statements.                                                                                  |   |   |   |   |   |   |   |   |

----

----

|                                   |   | March 31, 2011 |      |   | December 31, 2010(1) |   |
|----------------------------------------|--------|----------------|-----------|--------|----------------------|--------|
|                                   |   | AmortizedCost  |      |   | EstimatedFairValue   |   |   | AmortizedCost |   |   | EstimatedFairValue |   |
| Available for sale:                    |   |           |      |   |                 |   |   |   |   |   |   |   |
| United States treasury                 |   | $              | 4,041     |   |                 | $      | 4,045 |   |   | $ | 503 |   |   | $ | 506 |   |
| United States government agency        |   |           | 12,847    |   |                 |   | 12,856 |   |   |   | 12,664 |   |   |   | 12,680 |   |
| Mortgage-backed                        |   |           | 3,518     |   |                 |   | 3,676 |   |   |   | 3,758 |   |   |   | 3,918 |   |
| Municipalities                         |   |           | 370       |   |                 |   | 377 |   |   |   | 371 |   |   |   | 378 |   |
|                                   |   |           | 20,776    |   |                 |   | 20,954 |   |   |   | 17,296 |   |   |   | 17,482 |   |
| Held for long-term investment:         |   |           |      |   |                 |   |   |   |   |   |   |   |   |   |   |   |
| Capitol Development BancorpLimited III |   |           |  457 |   |                 |   |  457 |   |   |   |  463 |   |   |   |  463 |   |
| Corporate                              |   |           | 1,873     |   |                 |   | 1,873 |   |   |   | 2,430 |   |   |   | 2,430 |   |
|                                   |   |           | 2,330     |   |                 |   | 2,330 |   |   |   | 2,893 |   |   |   | 2,893 |   |
|                                   |   |           |      |   |                 |   |   |   |   |   |   |   |   |   |   |   |
|                                   |   | $              | 23,106    |   |                 | $      | 23,284 |   |   | $ | 20,189 |   |   | $ | 20,375 |   |

----

|                            |   | March 31, 2011 |   |   | December 31, 2010 |   |
|---------------------------------|--------|----------------|--------|--------|-------------------|--------|
|                            |   | Gains          |   |   | Losses            |   |   | Gains |   |   | Losses |   |
|                            |   |           |   |   |              |   |   |   |   |   |   |   |
| United States treasury          |   | $              | 4      |   |              |   |   |   | $ | 3 |   |   |   |   |
| United States government agency |   |           | 15     |   |              | $      | 6 |   |   |   | 17 |   |   | $ | 1 |   |
| Mortgage-backed                 |   |           | 158    |   |              |   |   |   |   |   | 160 |   |   |   |   |   |
| Municipalities                  |   |           | 7      |   |              |   |   |   |   |   | 7 |   |   |   |   |   |
|                            |   |           |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
|                            |   | $              | 184    |   |              | $      | 6 |   |   | $ | 187 |   |   | $ | 1 |   |

|                            |   | March 31, 2011 |   |   | December 31, 2010 |   |
|---------------------------------|--------|----------------|--------|--------|-------------------|--------|
|                            |   | UnrealizedLoss |   |   | CarryingValue     |   |   | UnrealizedLoss |   |   | CarryingValue |   |
|                            |   |           |   |   |              |   |   |   |   |   |   |   |
| One year or less:               |   |           |   |   |              |   |   |   |   |   |   |   |
| United States government agency |   | $              | 6      |   |              | $      | 5,002 |   |   | $ | 1 |   |   | $ | 4,794 |   |

|                                     |   | AmortizedCost |   |   | EstimatedFair Value |   |
|------------------------------------------|--------|---------------|--------|--------|---------------------|--------|
|                                     |   |          |   |   |                |   |
| Due in one year or less                  |   | $             | 4,561  |   |                | $      | 4,567 |   |
| After one year, through five years       |   |          | 8,286  |   |                |   | 8,307 |   |
| After five years, through ten years      |   |          | 690    |   |                |   | 717 |   |
| After ten years                          |   |          | 7,239  |   |                |   | 7,363 |   |
| Securities held for long-term investment |   |          |   |   |                |   |   |   |
| without stated maturities                |   |          | 2,330  |   |                |   | 2,330 |   |
|                                     |   |          |   |   |                |   |   |   |
|                                     |   | $             | 23,106 |   |                | $      | 23,284 |   |

----

|                       |   | March 31, 2011               |      |
|----------------------------|--------|------------------------------|-----------|
|                       |   | Secured by Real Estate       |      |   |   |   |   |   |   |   |   |   |   |   |   |
|                       |   |    Commercial |      |   | Residential(includingmulti-family) |   |   | Construction,LandDevelopmentand OtherLand |   |   | Commercialand OtherBusiness-PurposeLoans |   |   |    Consumer |   |   |    Other |   |   |    Total |   |
|                       |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses: |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Individually evaluated     |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for impairment             |   | $                            | 10,946    |   |   | $ | 5,767 |   |   | $ | 5,792 |   |   | $ | 6,831 |   |   |   |   |   |   |   |   | $ | 29,336 |   |
| Collectively evaluated     |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for impairment             |   |                         | 44,751    |   |   |   | 23,441 |   |   |   | 14,890 |   |   |   | 23,056 |   |   | $ | 1,031 |   |   | $ | 176 |   |   |   | 107,345 |   |
|                       |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total allowance for        |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| loan losses                |   | $                            | 55,697    |   |   | $ | 29,208 |   |   | $ | 20,682 |   |   | $ | 29,887 |   |   | $ | 1,031 |   |   | $ | 176 |   |   | $ | 136,681 |   |
|                       |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Portfolio loans:           |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Individually evaluated     |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for impairment             |   | $                            | 171,224   |   |   | $ | 59,005 |   |   | $ | 56,493 |   |   | $ | 24,780 |   |   | $ | 22 |   |   |   |   |   |   | $ | 311,524 |   |
| Collectively evaluated     |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for impairment             |   |                         | 1,175,360 |   |   |   | 438,310 |   |   |   | 160,500 |   |   |   | 326,093 |   |   |   | 22,044 |   |   | $ | 16,890 |   |   |   | 2,139,197 |   |
|                       |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total portfolio loans      |   | $                            | 1,346,584 |   |   | $ | 497,315 |   |   | $ | 216,993 |   |   | $ | 350,873 |   |   | $ | 22,066 |   |   | $ | 16,890 |   |   | $ | 2,450,721 |   |

|                       |   | December 31, 2010            |      |
|----------------------------|--------|------------------------------|-----------|
|                       |   | Secured by Real Estate       |      |   |   |   |   |   |   |   |   |   |   |   |   |
|                       |   |    Commercial |      |   | Residential(includingmulti-family) |   |   | Construction,LandDevelopmentand OtherLand |   |   | Commercialand OtherBusiness-PurposeLoans |   |   |    Consumer |   |   |    Other |   |   |    Total |   |
|                       |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses: |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Individually evaluated     |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for impairment             |   | $                            | 10,101    |   |   | $ | 5,828 |   |   | $ | 6,914 |   |   | $ | 6,108 |   |   |   |   |   |   |   |   | $ | 28,951 |   |
| Collectively evaluated     |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for impairment             |   |                         | 44,322    |   |   |   | 33,200 |   |   |   | 14,201 |   |   |   | 23,278 |   |   | $ | 858 |   |   | $ | 175 |   |   |   | 116,034 |   |
|                       |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total allowance for        |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| loan losses                |   | $                            | 54,423    |   |   | $ | 39,028 |   |   | $ | 21,115 |   |   | $ | 29,386 |   |   | $ | 858 |   |   | $ | 175 |   |   | $ | 144,985 |   |
|                       |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Portfolio loans:           |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Individually evaluated     |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for impairment             |   | $                            | 178,576   |   |   | $ | 57,923 |   |   | $ | 64,345 |   |   | $ | 26,914 |   |   | $ | 22 |   |   |   |   |   |   | $ | 327,780 |   |
| Collectively evaluated     |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for impairment             |   |                         | 1,196,215 |   |   |   | 461,020 |   |   |   | 166,443 |   |   |   | 349,054 |   |   |   | 23,353 |   |   | $ | 15,133 |   |   |   | 2,211,218 |   |
|                       |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total portfolio loans      |   | $                            | 1,374,791 |   |   | $ | 518,943 |   |   | $ | 230,788 |   |   | $ | 375,968 |   |   | $ | 23,375 |   |   | $ | 15,133 |   |   | $ | 2,538,998 |   |

----

|                       |   | Secured by Real Estate       |   |   |                               |   |   |                                      |   |   |                                     |   |   |                       |   |
|----------------------------|--------|------------------------------|--------|--------|------------------------------------|--------|--------|-------------------------------------------|--------|--------|------------------------------------------|--------|--------|----------------------------|--------|
|                       |   |    Commercial |   |   | Residential(includingmulti-family) |   |   | Construction,LandDevelopmentand OtherLand |   |   | Commercialand OtherBusiness-PurposeLoans |   |   |    Consumer |   |   |    Other |   |   |    Total |   |
|                       |   |                         |   |   |                               |   |   |                                      |   |   |                                     |   |   |                       |   |   |   |   |   |   |   |
| Beginning balance          |   | $                            | 54,423 |   |                               | $      | 39,028 |                                      |   | $      | 21,115                                   |   |   | $                          | 29,386 |   |   | $ | 858 |   |   | $ | 175 |   |   | $ | 144,985 |   |
|                       |   |                         |   |   |                               |   |   |                                      |   |   |                                     |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Acquired loan loss reserve |   |                         | 1,043  |   |                               |   | 117    |                                      |   |   | 651                                      |   |   |                       | 500    |   |   |   | 68 |   |   |   | 1 |   |   |   | 2,380 |   |
|                       |   |                         |   |   |                               |   |   |                                      |   |   |                                     |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Charge-offs                |   |                         | (8,753 | )      |                               |   | (7,341 | )                                         |   |   | (8,434                                   | )      |   |                       | (5,325 | ) |   |   | (223 | ) |   |   |   |   |   |   | (30,076 | ) |
| Recoveries                 |   |                         | 995    |   |                               |   | 982    |                                      |   |   | 3,023                                    |   |   |                       | 886    |   |   |   | 38 |   |   |   | 1 |   |   |   | 5,925 |   |
| Net charge-offs            |   |                         | (7,758 | )      |                               |   | (6,359 | )                                         |   |   | (5,411                                   | )      |   |                       | (4,439 | ) |   |   | (185 | ) |   |   | 1 |   |   |   | (24,151 | ) |
|                       |   |                         |   |   |                               |   |   |                                      |   |   |                                     |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision for loan losses  |   |                         | 7,989  |   |                               |   | (3,578 | )                                         |   |   | 4,327                                    |   |   |                       | 4,440  |   |   |   | 290 |   |   |   | (1 | ) |   |   | 13,467 |   |
|                       |   |                         |   |   |                               |   |   |                                      |   |   |                                     |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Ending balance             |   | $                            | 55,697 |   |                               | $      | 29,208 |                                      |   | $      | 20,682                                   |   |   | $                          | 29,887 |   |   | $ | 1,031 |   |   | $ | 176 |   |   | $ | 136,681 |   |

----

|                                                                        |   | Three Months EndedMarch 31 |        |
|-----------------------------------------------------------------------------|--------|----------------------------|-------------|
|                                                                        |   | 2011                       |        |   | 2010(1) |   |
|                                                                        |   |                       |        |   |   |   |
| Allowance for loan losses at beginning of period                            |   | $                          | 144,985     |   |   | $ | 129,310 |   |
|                                                                        |   |                       |        |   |   |   |   |   |
| Allowance for loan losses of previously-discontinuedbank subsidiary         |   |                       |  2,380 |   |   |   |  -- |   |
|                                                                        |   |                       |        |   |   |   |   |   |
| Loans charged-off:                                                          |   |                       |        |   |   |   |   |   |
| Loans secured by real estate:                                               |   |                       |        |   |   |   |   |   |
| Commercial                                                                  |   |                       | (8,753      | ) |   |   | (10,588 | ) |
| Residential (including multi-family)                                        |   |                       | (7,341      | ) |   |   | (12,126 | ) |
| Construction, land development and other land                               |   |                       | (8,434      | ) |   |   | (13,777 | ) |
| Total loans secured by real estate                                          |   |                       | (24,528     | ) |   |   | (36,491 | ) |
| Commercial and other business-purpose loans                                 |   |                       | (5,325      | ) |   |   | (7,457 | ) |
| Consumer                                                                    |   |                       | (223        | ) |   |   | (157 | ) |
| Total charge-offs                                                           |   |                       | (30,076     | ) |   |   | (44,105 | ) |
| Recoveries:                                                                 |   |                       |        |   |   |   |   |   |
| Loans secured by real estate:                                               |   |                       |        |   |   |   |   |   |
| Commercial                                                                  |   |                       | 995         |   |   |   | 358 |   |
| Residential (including multi-family)                                        |   |                       | 982         |   |   |   | 108 |   |
| Construction, land development and other land                               |   |                       | 3,023       |   |   |   | 1,301 |   |
| Total loans secured by real estate                                          |   |                       | 5,000       |   |   |   | 1,767 |   |
| Commercial and other business-purpose loans                                 |   |                       | 886         |   |   |   | 688 |   |
| Consumer                                                                    |   |                       | 38          |   |   |   | 19 |   |
| Other                                                                       |   |                       | 1           |   |   |   | -- |   |
| Total recoveries                                                            |   |                       | 5,925       |   |   |   | 2,474 |   |
| Net charge-offs                                                             |   |                       | (24,151     | ) |   |   | (41,631 | ) |
| Additions to allowance charged to expense (provision                        |   |                       |        |   |   |   |   |   |
| for loan losses)                                                            |   |                       | 13,467      |   |   |   | 47,364 |   |
|                                                                        |   |                       |        |   |   |   |   |   |
| Allowance for loan losses at end of period                                  |   | $                          | 136,681     |   |   | $ | 135,043 |   |
|                                                                        |   |                       |        |   |   |   |   |   |
| Average total portfolio loans for the period                                |   | $                          | 2,558,053   |   |   | $ | 3,215,054 |   |
|                                                                        |   |                       |        |   |   |   |   |   |
| Ratio of net charge-offs (annualized) to averageportfolio loans outstanding |   |                       | 3.78        | % |   |   | 5.18 | % |

----

|                                                |   | March 31,2011 |          |   | December 31,2010(1) |   |
|-----------------------------------------------------|--------|---------------|---------------|--------|---------------------|--------|
| Nonaccrual loans:                                   |   |          |          |   |                |   |
| Loans secured by real estate:                       |   |          |          |   |                |   |
| Commercial                                          |   | $             | 146,095       |   |                | $      | 153,956 |   |
| Residential (including multi-family)                |   |          | 53,502        |   |                |   | 60,422 |   |
| Construction, land development and other land       |   |          | 51,877        |   |                |   | 59,718 |   |
| Total loans secured by real estate                  |   |          | 251,474       |   |                |   | 274,096 |   |
| Commercial and other business-purpose loans         |   |          | 30,141        |   |                |   | 30,660 |   |
| Consumer                                            |   |          | 538           |   |                |   | 162 |   |
| Total nonaccrual loans                              |   |          | 282,153       |   |                |   | 304,918 |   |
|                                                |   |          |          |   |                |   |   |   |
| Past due (>90 days) loans and accruing interest: |   |          |          |   |                |   |   |   |
| Loans secured by real estate:                       |   |          |          |   |                |   |   |   |
| Commercial                                          |   |          | 5,049         |   |                |   | 2,875 |   |
| Residential (including multi-family)                |   |          | 688           |   |                |   | 1,484 |   |
| Construction, land development and other land       |   |          | 2,374         |   |                |   | 2,380 |   |
| Total loans secured by real estate                  |   |          | 8,111         |   |                |   | 6,739 |   |
| Commercial and other business-purpose loans         |   |          | 410           |   |                |   | 2,073 |   |
| Consumer                                            |   |          | 19            |   |                |   | 279 |   |
| Total past due loans                                |   |          | 8,540         |   |                |   | 9,091 |   |
|                                                |   |          |          |   |                |   |   |   |
| Total nonperforming loans                           |   | $             | 290,693       |   |                | $      | 314,009 |   |
|                                                |   |          |          |   |                |   |   |   |
| Real estate owned and otherrepossessed assets       |   |          |  111,428 |   |                |   |  107,095 |   |
|                                                |   |          |          |   |                |   |   |   |
| Total nonperforming assets                          |   | $             | 402,121       |   |                | $      | 421,104 |   |

----

|                                          |   |  CarryingValue |    |   | UnpaidPrincipalBalance |   |    | RelatedAllowancefor LoanLosses |   |
|-----------------------------------------------|--------|---------------------|---------|--------|------------------------|--------|---------|--------------------------------|--------|
|                                          |   |                |    |   |                   |   |    |                           |   |
| With an allowance recorded:                   |   |                |    |   |                   |   |    |                           |   |
| Loans secured by real estate:                 |   |                |    |   |                   |   |    |                           |   |
| Commercial                                    |   | $                   | 74,883  |   |                   | $      | 84,957  |                           |   | $ | 13,091 |   |
| Residential (including multi-family)          |   |                | 28,796  |   |                   |   | 30,529  |                           |   |   | 7,870 |   |
| Construction, land development and other land |   |                | 25,170  |   |                   |   | 25,766  |                           |   |   | 6,530 |   |
| Total loans secured by real estate            |   |                | 128,849 |   |                   |   | 141,252 |                           |   |   | 27,491 |   |
| Commercial and other business-purpose loans   |   |                | 19,720  |   |                   |   | 21,607  |                           |   |   | 10,364 |   |
| Consumer                                      |   |                | 520     |   |                   |   | 550     |                           |   |   | 121 |   |
|                                          |   |                | 149,089 |   |                   |   | 163,409 |                           |   |   | 37,976 |   |
| With no related allowance recorded:           |   |                |    |   |                   |   |    |                           |   |   |   |   |
| Loans secured by real estate:                 |   |                |    |   |                   |   |    |                           |   |   |   |   |
| Commercial                                    |   |                | 114,794 |   |                   |   | 150,893 |                           |   |   |   |   |
| Residential (including multi-family)          |   |                | 35,056  |   |                   |   | 53,372  |                           |   |   |   |   |
| Construction, land development and other land |   |                | 35,234  |   |                   |   | 58,358  |                           |   |   |   |   |
| Total loans secured by real estate            |   |                | 185,084 |   |                   |   | 262,623 |                           |   |   |   |   |
| Commercial and other business-purpose loans   |   |                | 13,944  |   |                   |   | 21,701  |                           |   |   |   |   |
| Consumer                                      |   |                | 18      |   |                   |   | 43      |                           |   |   |   |   |
|                                          |   |                | 199,046 |   |                   |   | 284,367 |                           |   |   |   |   |
|                                          |   |                |    |   |                   |   |    |                           |   |   |   |   |
| Total                                         |   | $                   | 348,135 |   |                   | $      | 447,776 |                           |   | $ | 37,976 |   |

|                                          |   | Average    |    |   | Interest |   |
|-----------------------------------------------|--------|------------|---------|--------|----------|--------|
|                                          |   | Recorded   |    |   | Income   |   |
|                                          |   | Investment |    |   | Recorded |   |
|                                          |   |       |    |   |     |   |
| Commercial                                    |   | $          | 189,504 |   |     | $      | 558 |   |
| Residential (including multi-family)          |   |       | 67,160  |   |     |   | 150 |   |
| Construction, land development and other land |   |       | 63,893  |   |     |   | 52 |   |
| Total loans secured by real estate            |   |       | 320,557 |   |     |   | 760 |   |
| Commercial and other business-purpose loans   |   |       | 34,883  |   |     |   | 100 |   |
| Consumer                                      |   |       | 371     |   |     |   |   |   |
|                                          |   |       |    |   |     |   |   |   |
| Total                                         |   | $          | 355,811 |   |     | $      | 860 |   |

----

|                                          |   |  CarryingValue |    |   | UnpaidPrincipalBalance |   |    | RelatedAllowancefor LoanLosses |   |
|-----------------------------------------------|--------|---------------------|---------|--------|------------------------|--------|---------|--------------------------------|--------|
|                                          |   |                |    |   |                   |   |    |                           |   |
| With an allowance recorded:                   |   |                |    |   |                   |   |    |                           |   |
| Loans secured by real estate:                 |   |                |    |   |                   |   |    |                           |   |
| Commercial                                    |   | $                   | 81,800  |   |                   | $      | 131,352 |                           |   | $ | 12,977 |   |
| Residential (including multi-family)          |   |                | 39,743  |   |                   |   | 47,718  |                           |   |   | 10,999 |   |
| Construction, land development and other land |   |                | 27,150  |   |                   |   | 51,117  |                           |   |   | 8,554 |   |
| Total loans secured by real estate            |   |                | 148,693 |   |                   |   | 230,187 |                           |   |   | 32,530 |   |
| Commercial and other business-purpose loans   |   |                | 21,926  |   |                   |   | 35,307  |                           |   |   | 9,189 |   |
| Consumer                                      |   |                | 185     |   |                   |   | 211     |                           |   |   | 104 |   |
|                                          |   |                | 170,804 |   |                   |   | 265,705 |                           |   |   | 41,823 |   |
| With no related allowance recorded:           |   |                |    |   |                   |   |    |                           |   |   |   |   |
| Loans secured by real estate:                 |   |                |    |   |                   |   |    |                           |   |   |   |   |
| Commercial                                    |   |                | 107,531 |   |                   |   | 173,018 |                           |   |   |   |   |
| Residential (including multi-family)          |   |                | 30,724  |   |                   |   | 51,005  |                           |   |   |   |   |
| Construction, land development and other land |   |                | 40,232  |   |                   |   | 64,807  |                           |   |   |   |   |
| Total loans secured by real estate            |   |                | 178,487 |   |                   |   | 288,830 |                           |   |   |   |   |
| Commercial and other business-purpose loans   |   |                | 14,176  |   |                   |   | 23,209  |                           |   |   |   |   |
| Consumer                                      |   |                | 18      |   |                   |   | 42      |                           |   |   |   |   |
|                                          |   |                | 192,681 |   |                   |   | 312,081 |                           |   |   |   |   |
|                                          |   |                |    |   |                   |   |    |                           |   |   |   |   |
| Total                                         |   | $                   | 363,485 |   |                   | $      | 577,786 |                           |   | $ | 41,823 |   |

|                              |   | March 31, 2011               |         |
|-----------------------------------|--------|------------------------------|--------------|
|                              |   | Past Due Loans               |         |   | Total |   |   |   |   |   |   |   |
|                              |   | (based on payment due dates) |         |   | Amount of |   |   |   |   |   |   |   |
|                              |   |                         |         |   |   |   |   | Loans on |   |   | Loans More |   |   | Loans Either |   |   |   |   |
|                              |   | More Than                    |         |   |   |   |   | Nonaccrual |   |   | Than 29 Days |   |   | Current or |   |   |   |   |
|                              |   | 29 Days,                     |         |   | More Than |   |   | Status |   |   | Past Due or on |   |   | Less Than |   |   | Total |   |
|                              |   | and Less Than                |         |   | 89 Days |   |   | (Generally, 90 |   |   | Nonaccrual |   |   | 30 Days |   |   | Portfolio |   |
|                              |   | 90 Days                      |         |   | (Accruing) |   |   | Days or More) |   |   | Status |   |   | Past Due |   |   | Loans |   |
|                              |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans secured by real estate:     |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                        |   | $                            | 23,853       |   |   | $ | 5,049 |   |   | $ | 146,095 |   |   | $ | 174,997 |   |   | $ | 1,171,587 |   |   | $ | 1,346,584 |   |
| Residential (including multi-     |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| family)                           |   |                         | 8,551        |   |   |   | 688 |   |   |   | 53,502 |   |   |   | 62,741 |   |   |   | 434,574 |   |   |   | 497,315 |   |
| Construction, land development    |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| and other land                    |   |                         | 8,758        |   |   |   | 2,374 |   |   |   | 51,877 |   |   |   | 63,009 |   |   |   | 153,984 |   |   |   | 216,993 |   |
| Total loans secured by realestate |   |                         |  41,162 |   |   |   |  8,111 |   |   |   |  251,474 |   |   |   |  300,747 |   |   |   |  1,760,145 |   |   |   |  2,060,892 |   |
| Commercial and other business-    |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| purpose loans                     |   |                         | 5,936        |   |   |   | 410 |   |   |   | 30,141 |   |   |   | 36,487 |   |   |   | 314,386 |   |   |   | 350,873 |   |
| Consumer                          |   |                         | 555          |   |   |   | 19 |   |   |   | 538 |   |   |   | 1,112 |   |   |   | 20,954 |   |   |   | 22,066 |   |
| Other                             |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 16,890 |   |   |   | 16,890 |   |
|                              |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                             |   | $                            | 47,653       |   |   | $ | 8,540 |   |   | $ | 282,153 |   |   | $ | 338,346 |   |   | $ | 2,112,375 |   |   | $ | 2,450,721 |   |

----

|                              |   | December 31, 2010            |         |
|-----------------------------------|--------|------------------------------|--------------|
|                              |   | Past Due Loans               |         |   | Total |   |   |   |   |   |   |   |
|                              |   | (based on payment due dates) |         |   | Amount of |   |   |   |   |   |   |   |
|                              |   |                         |         |   |   |   |   | Loans on |   |   | Loans More |   |   | Loans Either |   |   |   |   |
|                              |   | More Than                    |         |   |   |   |   | Nonaccrual |   |   | Than 29 Days |   |   | Current or |   |   |   |   |
|                              |   | 29 Days,                     |         |   | More Than |   |   | Status |   |   | Past Due or on |   |   | Less Than |   |   | Total |   |
|                              |   | and Less Than                |         |   | 89 Days |   |   | (Generally, 90 |   |   | Nonaccrual |   |   | 30 Days |   |   | Portfolio |   |
|                              |   | 90 Days                      |         |   | (Accruing) |   |   | Days or More) |   |   | Status |   |   | Past Due |   |   | Loans |   |
|                              |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans secured by real estate:     |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                        |   | $                            | 29,819       |   |   | $ | 2,875 |   |   | $ | 153,956 |   |   | $ | 186,650 |   |   | $ | 1,188,141 |   |   | $ | 1,374,791 |   |
| Residential (including multi-     |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| family)                           |   |                         | 12,470       |   |   |   | 1,484 |   |   |   | 60,422 |   |   |   | 74,376 |   |   |   | 444,567 |   |   |   | 518,943 |   |
| Construction, land development    |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| and other land                    |   |                         | 6,467        |   |   |   | 2,380 |   |   |   | 59,718 |   |   |   | 68,565 |   |   |   | 162,223 |   |   |   | 230,788 |   |
| Total loans secured by realestate |   |                         |  48,756 |   |   |   |  6,739 |   |   |   |  274,096 |   |   |   |  329,591 |   |   |   |  1,794,931 |   |   |   |  2,124,522 |   |
| Commercial and other business-    |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| purpose loans                     |   |                         | 9,689        |   |   |   | 2,073 |   |   |   | 30,660 |   |   |   | 42,422 |   |   |   | 333,546 |   |   |   | 375,968 |   |
| Consumer                          |   |                         | 560          |   |   |   | 279 |   |   |   | 162 |   |   |   | 1,001 |   |   |   | 22,374 |   |   |   | 23,375 |   |
| Other                             |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 15,133 |   |   |   | 15,133 |   |
|                              |   |                         |         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                             |   | $                            | 59,005       |   |   | $ | 9,091 |   |   | $ | 304,918 |   |   | $ | 373,014 |   |   | $ | 2,165,984 |   |   | $ | 2,538,998 |   |

----

|                                  |   | March 31, 2011              |      |
|---------------------------------------|--------|-----------------------------|-----------|
|                                  |   | LoansNotAdverselyClassified |      |   |  Adversely Classified Loans |   |   | TotalPortfolioLoans |   |
|                                  |   | Watch                       |      |   | Substandard |   |
|                                  |   |                        |      |   |   |   |   |   |   |   |   |   |
| Loans secured by real estate:         |   |                        |      |   |   |   |   |   |   |   |   |   |
| Commercial                            |   | $                           | 969,754   |   |   | $ | 114,442 |   |   | $ | 262,388 |   |   | $ | 1,346,584 |   |
| Residential (including multi-family)  |   |                        | 356,893   |   |   |   | 41,155 |   |   |   | 99,267 |   |   |   | 497,315 |   |
| Construction, land development and    |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| other land                            |   |                        | 112,691   |   |   |   | 25,146 |   |   |   | 79,156 |   |   |   | 216,993 |   |
| Total loans secured by real estate    |   |                        | 1,439,338 |   |   |   | 180,743 |   |   |   | 440,811 |   |   |   | 2,060,892 |   |
| Commercial and other business-purpose |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| loans                                 |   |                        | 267,633   |   |   |   | 27,348 |   |   |   | 55,892 |   |   |   | 350,873 |   |
| Consumer                              |   |                        | 20,320    |   |   |   | 378 |   |   |   | 1,368 |   |   |   | 22,066 |   |
| Other                                 |   |                        | 15,764    |   |   |   | 1,126 |   |   |   |   |   |   |   | 16,890 |   |
|                                  |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                 |   | $                           | 1,743,055 |   |   | $ | 209,595 |   |   | $ | 498,071 |   |   | $ | 2,450,721 |   |

|                                  |   | December 31, 2010           |      |
|---------------------------------------|--------|-----------------------------|-----------|
|                                  |   | LoansNotAdverselyClassified |      |   |  Adversely Classified Loans |   |   | TotalPortfolioLoans |   |
|                                  |   | Watch                       |      |   | Substandard |   |
|                                  |   |                        |      |   |   |   |   |   |   |   |   |   |
| Loans secured by real estate:         |   |                        |      |   |   |   |   |   |   |   |   |   |
| Commercial                            |   | $                           | 990,225   |   |   | $ | 118,619 |   |   | $ | 265,947 |   |   | $ | 1,374,791 |   |
| Residential (including multi-family)  |   |                        | 377,046   |   |   |   | 42,157 |   |   |   | 99,740 |   |   |   | 518,943 |   |
| Construction, land development and    |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| other land                            |   |                        | 115,042   |   |   |   | 30,707 |   |   |   | 85,039 |   |   |   | 230,788 |   |
| Total loans secured by real estate    |   |                        | 1,482,313 |   |   |   | 191,483 |   |   |   | 450,726 |   |   |   | 2,124,522 |   |
| Commercial and other business-purpose |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| loans                                 |   |                        | 278,739   |   |   |   | 32,220 |   |   |   | 65,009 |   |   |   | 375,968 |   |
| Consumer                              |   |                        | 21,602    |   |   |   | 1,028 |   |   |   | 745 |   |   |   | 23,375 |   |
| Other                                 |   |                        | 13,565    |   |   |   | 1,568 |   |   |   |   |   |   |   | 15,133 |   |
|                                  |   |                        |      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                 |   | $                           | 1,796,219 |   |   | $ | 226,299 |   |   | $ | 516,480 |   |   | $ | 2,538,998 |   |

----

|                                  |             |   | Sale     |   |   |   |   |
|---------------------------------------|------------------|--------|----------|--------|--------|--------|--------|
|                                  | Date Sold        |   | Proceeds |   |   | Gain   |   |
|                                  |             |   |     |   |   |   |   |
| Bank of Tucson – main office(1) | January 24, 2011 |   | $        | 4,567  |   |   | $      | 4,186 |   |
| Bank of Fort Bend(2)                  | March 30, 2011   |   |     | 4,302  |   |   |   | 1,432 |   |
|                                  |             |   |     |   |   |   |   |   |   |
|                                  |             |   | $        | 8,869  |   |   | $      | 5,618 |   |

|   | (1) | Previously a wholly-owned subsidiary of Capitol.  Sale proceeds represent the net premium received from the assumption of liabilities and acquisition of assets transaction.  |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Previously a majority-owned subsidiary of a bank-development subsidiary controlled by Capitol. |
|--------|-----|------------------------------------------------------------------------------------------------|

|                                      |   | Three Months EndedMarch 31 |   |
|-------------------------------------------|--------|----------------------------|--------|
|                                      |   | 2011                       |   |   | 2010 |   |
|                                      |   |                       |   |   |   |   |
| Interest income                           |   | $                          | 1,830  |   |   | $ | 14,927 |   |
| Interest expense                          |   |                       | 427    |   |   |   | 3,305 |   |
| Net interest income                       |   |                       | 1,403  |   |   |   | 11,622 |   |
| Provision for loan losses                 |   |                       | 494    |   |   |   | 2,736 |   |
| Net interest income after provision for   |   |                       |   |   |   |   |   |   |
| loan losses                               |   |                       | 909    |   |   |   | 8,886 |   |
| Noninterest income                        |   |                       | 441    |   |   |   | 1,163 |   |
| Gain on sale of bank subsidiaries         |   |                       | 4,368  |   |   |   |   |   |
| Noninterest expense                       |   |                       | 1,334  |   |   |   | 8,516 |   |
| Income before income taxes                |   |                       | 4,384  |   |   |   | 1,533 |   |
| Less income tax expense                   |   |                       | 1,488  |   |   |   | 594 |   |
| Net income from discontinued operations   |   |                       | 2,896  |   |   |   | 939 |   |
| Net income attributable to noncontrolling |   |                       |   |   |   |   |   |   |
| interests in consolidated subsidiaries    |   |                       | (60    | ) |   |   | (126 | ) |
| Net income from discontinued operations   |   |                       |   |   |   |   |   |   |
| attributable to Capitol Bancorp Limited   |   | $                          | 2,836  |   |   | $ | 813 |   |
| Net income from discontinued operations   |   |                       |   |   |   |   |   |   |
| per common share attributable to          |   |                       |   |   |   |   |   |   |
| Capitol Bancorp Limited                   |   | $                          | 0.09   |   |   | $ | 0.05 |   |

----

|                      |   | March 31,2011 |    |   | Dec 31,2010 |   |         |   | March 31,2011             |   |   | Dec 31,2010 |   |
|---------------------------|--------|---------------|---------|--------|-------------|--------|--------------|--------|---------------------------|--------|--------|-------------|--------|
| Assets:                   |   |          |    |   |        |   | Liabilities: |   |                      |   |   |        |   |
| Cash and cash equivalents |   | $             | 19,719  |   |        | $      | 86,747       |   | Noninterest-bearing       |   |   |        |   |   |   |
| Investment securities     |   |          | 6,682   |   |        |   | 10,664       |   | deposits                  |   | $      | 9,212       |   |   | $ | 84,840 |   |
| Federal Home Loan Bank    |   |          |    |   |        |   |         |   | Interest-bearing deposits |   |   | 111,468     |   |   |   | 277,677 |   |
| stock                     |   |          | 1,065   |   |        |   | 1,912        |   | Total deposits            |   |   | 120,680     |   |   |   | 362,517 |   |
| Portfolio loans           |   |          | 101,219 |   |        |   | 292,047      |   | Other liabilities         |   |   | 4,119       |   |   |   | 6,843 |   |
| Less allowance for loan   |   |          |    |   |        |   |         |   |                      |   |   |        |   |   |   |   |   |
|   losses             |   |          | (1,628  | )      |        |   | (4,816       | )      |                      |   | $      | 124,799     |   |   | $ | 369,360 |   |
| Net portfolio loans       |   |          | 99,591  |   |        |   | 287,231      |   |                      |   |   |        |   |   |   |   |   |
| Premises and equipment    |   |          | 2,667   |   |        |   | 4,169        |   |                      |   |   |        |   |   |   |   |   |
| Other real estate owned   |   |          | 2,099   |   |        |   | 2,226        |   |                      |   |   |        |   |   |   |   |   |
| Other assets              |   |          | 2,678   |   |        |   | 5,584        |   |                      |   |   |        |   |   |   |   |   |
|                      |   |          |    |   |        |   |         |   |                      |   |   |        |   |   |   |   |   |
|                      |   | $             | 134,501 |   |        | $      | 398,533      |   |                      |   |   |        |   |   |   |   |   |

|   | Investment securities available for sale:  Securities available for sale are recorded at fair value on a recurring basis.  Fair value measurement is based on quoted prices, when available.  If quoted prices are not available, fair values are measured using independent pricing models. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Mortgage loans held for sale:  Mortgage loans held for sale are carried at the lower of aggregate cost or fair value and are measured on a nonrecurring basis.  There were no mortgage loans held for sale written down to fair value at March 31, 2011.  Fair value is based on independent quoted market prices, where applicable, or the prices for other whole mortgage loans with similar characteristics. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Loans:  The Corporation does not record loans at fair value on a recurring basis.  However, from time to time, nonrecurring fair value adjustments for collateral-dependent loans are recorded to reflect partial write-downs or specific reserves based on the observable market price, current appraised value of the collateral or other estimates of fair value. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Other real estate owned:  At the time of foreclosure, foreclosed properties are adjusted to estimated fair value less estimated costs to sell upon transfer from portfolio loans to other real estate owned, establishing a new carrying value.  The Corporation subsequently adjusts estimated fair value of other real estate owned on a nonrecurring basis to reflect partial write-downs based on the observable market price or current appraisal data. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Long-lived and indefinite-lived assets:  The Corporation does not record long-lived or indefinite-lived assets at fair value on a recurring basis.  However, from time to time, nonrecurring fair value adjustments to a long-lived or indefinite-lived asset are recorded to reflect partial write-downs based on the observable market price or other estimate of fair value in the event of impairment. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                      |   | March 31, 2011 |      |   | December 31, 2010                           |   |
|-------------------------------------------|--------|----------------|-----------|--------|---------------------------------------------|--------|
|                                      |   |  Total    |      |   | Significant OtherObservable Inputs(Level 2) |   |   |  Total(2) |   |   | Significant OtherObservable Inputs(Level 2)(2) |   |
|                                      |   |           |      |   |                                        |   |   |   |   |   |   |   |
| Investment securities available for sale: |   |           |      |   |                                        |   |   |   |   |   |   |   |
| United States treasury                    |   | $              | 4,045     |   |                                        | $      | 4,045 |   |   | $ | 506 |   |   | $ | 506 |   |
| United States government agency           |   |           | 12,856    |   |                                        |   | 12,856 |   |   |   | 12,680 |   |   |   | 12,680 |   |
| Mortgage-backed                           |   |           | 3,676     |   |                                        |   | 3,676 |   |   |   | 3,918 |   |   |   | 3,918 |   |
| Municipalities                            |   |           |  377 |   |                                        |   |  377 |   |   |   |  378 |   |   |   |  378 |   |
|                                      |   |           |      |   |                                        |   |   |   |   |   |   |   |   |   |   |   |
|                                      |   | $              | 20,954    |   |                                        | $      | 20,954 |   |   | $ | 17,482 |   |   | $ | 17,482 |   |

|                       |   | March 31, 2011    |    |   | December 31, 2010                      |   |
|----------------------------|--------|-------------------|---------|--------|----------------------------------------|--------|
|                       |   |   Total |    |   | SignificantUnobservableInputs(Level 3) |   |   |   Total(2) |   |   | SignificantUnobservableInputs(Level 3)(2) |   |
|                       |   |              |    |   |                                   |   |   |   |   |   |   |   |
| Impaired loans(1)          |   | $                 | 313,665 |   |                                   | $      | 313,665 |   |   | $ | 321,196 |   |   | $ | 321,196 |   |
|                       |   |              |    |   |                                   |   |   |   |   |   |   |   |   |   |   |   |
| Other real estate owned(1) |   | $                 | 110,829 |   |                                   | $      | 110,829 |   |   | $ | 106,835 |   |   | $ | 106,835 |   |

| (1)   | Represents carrying value based on the appraised value of the applicable collateral or foreclosed property or other estimates of fair value.  For other real estate owned, such fair value is reduced by estimated costs to sell the properties. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)   | Excludes amounts related to discontinued operations. |
|-----------------|------------------------------------------------------|

----

|                                                 |   | March 31, 2011  |      |   | December 31, 2010(2) |   |
|------------------------------------------------------|--------|----------------------|-----------|--------|----------------------|--------|
|                                                 |   | CarryingValue        |      |   | EstimatedFair Value  |   |   | CarryingValue |   |   | EstimatedFair Value |   |
| Financial assets:                                    |   |                 |      |   |                 |   |   |   |   |   |   |   |
| Cash and cash equivalents                            |   | $                    | 536,494   |   |                 | $      | 536,494 |   |   | $ | 534,761 |   |   | $ | 534,761 |   |
| Loans held for sale                                  |   |                 | 1,710     |   |                 |   | 1,710 |   |   |   | 6,900 |   |   |   | 6,900 |   |
| Investment securities:                               |   |                 |      |   |                 |   |   |   |   |   |   |   |   |   |   |   |
| Available for sale                                   |   |                 | 20,954    |   |                 |   | 20,954 |   |   |   | 17,482 |   |   |   | 17,482 |   |
| Held for long-term investment                        |   |                 | 2,330     |   |                 |   | 2,330 |   |   |   | 2,893 |   |   |   | 2,893 |   |
|                                                 |   |                 | 23,284    |   |                 |   | 23,284 |   |   |   | 20,375 |   |   |   | 20,375 |   |
| Federal Home Loan Bank and Federal ReserveBank stock |   |                 | 17,811    |   |                 |   | 17,811 |   |   |   | 17,001 |   |   |   | 17,001 |   |
| Portfolio loans:                                     |   |                 |      |   |                 |   |   |   |   |   |   |   |   |   |   |   |
| Loans secured by real estate:                        |   |                 |      |   |                 |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                                           |   |                 | 1,346,584 |   |                 |   | 1,347,647 |   |   |   | 1,374,791 |   |   |   | 1,379,583 |   |
| Residential (including multi-family)                 |   |                 | 497,315   |   |                 |   | 497,524 |   |   |   | 518,943 |   |   |   | 518,493 |   |
| Construction, land development and other land        |   |                 | 216,993   |   |                 |   | 217,305 |   |   |   | 230,788 |   |   |   | 230,886 |   |
| Total loans secured by real estate                   |   |                 | 2,060,892 |   |                 |   | 2,062,476 |   |   |   | 2,124,522 |   |   |   | 2,128,962 |   |
| Commercial and other business-purpose loans          |   |                 | 350,873   |   |                 |   | 351,369 |   |   |   | 375,968 |   |   |   | 376,338 |   |
| Consumer                                             |   |                 | 22,066    |   |                 |   | 22,358 |   |   |   | 23,375 |   |   |   | 23,613 |   |
| Other                                                |   |                 | 16,890    |   |                 |   | 17,002 |   |   |   | 15,133 |   |   |   | 15,055 |   |
| Total portfolio loans                                |   |                 | 2,450,721 |   |                 |   | 2,453,205 |   |   |   | 2,538,998 |   |   |   | 2,543,968 |   |
| Less allowance for loan losses                       |   |                 | (136,681  | )      |                 |   | (136,681 | ) |   |   | (144,985 | ) |   |   | (144,985 | ) |
| Net portfolio loans                                  |   |                 | 2,314,040 |   |                 |   | 2,316,524 |   |   |   | 2,394,013 |   |   |   | 2,398,983 |   |
|                                                 |   |                 |      |   |                 |   |   |   |   |   |   |   |   |   |   |   |
| Financial liabilities:                               |   |                 |      |   |                 |   |   |   |   |   |   |   |   |   |   |   |
| Deposits:                                            |   |                 |      |   |                 |   |   |   |   |   |   |   |   |   |   |   |
| Noninterest-bearing                                  |   |                 | 531,455   |   |                 |   | 531,455 |   |   |   | 500,809 |   |   |   | 500,809 |   |
| Interest-bearing:                                    |   |                 |      |   |                 |   |   |   |   |   |   |   |   |   |   |   |
| Demand accounts                                      |   |                 | 757,271   |   |                 |   | 757,271 |   |   |   | 787,042 |   |   |   | 787,042 |   |
| Time certificates of less than $100,000              |   |                 | 689,866   |   |                 |   | 693,625 |   |   |   | 711,609 |   |   |   | 715,720 |   |
| Time certificates of $100,000 or more                |   |                 | 829,378   |   |                 |   | 832,952 |   |   |   | 874,841 |   |   |   | 878,653 |   |
| Total interest-bearing                               |   |                 | 2,276,515 |   |                 |   | 2,283,848 |   |   |   | 2,373,492 |   |   |   | 2,381,415 |   |
| Total deposits                                       |   |                 | 2,807,970 |   |                 |   | 2,815,303 |   |   |   | 2,874,301 |   |   |   | 2,882,224 |   |
| Notes payable and other borrowings                   |   |                 | 106,052   |   |                 |   | 99,126 |   |   |   | 117,377 |   |   |   | 110,204 |   |
| Subordinated debentures                              |   |                 | 149,080   |   |                 |   | 151,296 | (1) |   |   | 167,586 |   |   |   | 170,841 | (1) |

| (1)   | Represents liquidation or principal amount outstanding.  The quoted market value of certain trust-preferred securities |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------|

| (Capitol Trust I and XII) included within subordinated debentures was substantially less than that amount. |
|------------------------------------------------------------------------------------------------------------|

| (2)   | Excludes amounts related to discontinued operations. |
|-----------------|------------------------------------------------------|

----

|                           |   |  NumberOutstanding |          |   |  Exercise PriceRange |   |                                  | WeightedAverageExercisePrice |   |
|--------------------------------|--------|-------------------------|---------------|--------|---------------------------|--------|---------------------------------------|------------------------------|--------|
|                           |   |                    |          |   |                      |   |                                  |                         |   |
| Outstanding at January 1, 2011 |   |                    | 1,745,602     |   |                      | $      |   1.78 to $ 46.20 |                         |   | $ | 21.53 |   |
| Cancelled or expired           |   |                    |  (29,307 | )      |                      |   | 28.75 to    30.21 |                         |   |   | 29.29 |   |
|                           |   |                    |          |   |                      |   |                                  |                         |   |   |   |   |
| Outstanding at March 31, 2011  |   |                    | 1,716,295     |   |                      | $      |   1.78 to $ 46.20 |                         |   | $ | 21.40 |   |

|                |                           |   |              |      |          | Weighted Average |
|---------------------|--------------------------------|--------|-------------------|-----------|---------------|------------------|
| Exercise PriceRange |                           |   | NumberOutstanding |      |          | ExercisePrice    |   | RemainingContractualLife |
|                |                           |   |              |      |          |             |   |   |
| $                   |   1.00 to 14.99 |   |              |      | 566,105       |             |   | $ | 2.49 |   |      4.50 years |
| $                   | 15.00 to 19.99       |   |              |      | 66,883        |             |   |   | 16.40 |   |      0.53 years |
| $                   | 20.00 to 24.99       |   |              |      | 205,953       |             |   |   | 22.02 |   |      3.29 years |
| $                   | 25.00 to 29.99       |   |              |      | 90,001        |             |   |   | 25.47 |   |      0.22 years |
| $                   | 30.00 to 34.99       |   |              |      | 457,357       |             |   |   | 31.78 |   |      0.91 years |
| $              | 35.00 or more        |   |              |      |  339,996 |             |   |   | 37.91 |   |      1.79 years |
|                |                           |   |              |      |          |             |   |   |   |   |   |
| Total outstanding   |                           |   |              | 1,716,295 |          |             | $ | 21.40 |   |   |

----

|                                                                                                                                                                                                                                                                        |   | Three Months EndedMarch 31 |                       |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------|----------------------------|
|                                                                                                                                                                                                                                                                        |   | 2011                       |                       |   | 2010 |   |
|                                                                                                                                                                                                                                                                        |   |                       |                       |   |   |   |
| Numerator—net income (loss) attributable to Capitol   Bancorp Limited for the period                                                                                                                                                                        |   | $                          | 289                        |   |   | $ | (47,882 | ) |
|                                                                                                                                                                                                                                                                        |   |                       |                       |   |   |   |   |   |
| Denominator:                                                                                                                                                                                                                                                                |   |                       |                       |   |   |   |   |   |
| Weighted average number of common shares       outstanding, excluding unvested restricted shares       of common stock (denominator for basic earnings       per share) |   |                       |      32,164 |   |   |   |      17,402 |   |
|                                                                                                                                                                                                                                                                        |   |                       |                       |   |   |   |   |   |
| Effect of dilutive securities:                                                                                                                                                                                                                                              |   |                       |                       |   |   |   |   |   |
| Unvested restricted shares of common stock                                                                                                                                                                                                                                  |   |                       | 711                        |   |   |   | -- |   |
|                                                                                                                                                                                                                                                                        |   |                       |                       |   |   |   |   |   |
| Denominator for diluted earnings per share—Weighted average number of shares and potentialdilution                                                                                                                                                                    |   |                       |    32,875        |   |   |   |    17,402 |   |
|                                                                                                                                                                                                                                                                        |   |                       |                       |   |   |   |   |   |
| Number of antidilutive stock options excludedfrom diluted earnings per share computation                                                                                                                                                                                    |   |                       |  1,716                |   |   |   |  2,355 |   |
|                                                                                                                                                                                                                                                                        |   |                       |                       |   |   |   |   |   |
| Number of antidilutive unvested restrictedshares excluded from basic and dilutedearnings per share computation                                                                                                                                                              |   |                       |    30            |   |   |   |    140 |   |
|                                                                                                                                                                                                                                                                        |   |                       |                       |   |   |   |   |   |
| Number of antidilutive warrants excludedfrom diluted earnings per share computation                                                                                                                                                                                         |   |                       |  1,325                |   |   |   |  76 |   |

----

----

| PCAN                        |   | PCAD                    |
|-----------------------------|--------|-------------------------|
|                        |   |                    |
| Michigan Commerce Bank      |   | Michigan Commerce Bank  |
| Bank of Las Vegas           |   | Bank of Las Vegas       |
| Sunrise Bank of Arizona     |   | Sunrise Bank of Arizona |
| Sunrise Bank (GA)           |   |                    |
| First Carolina State Bank   |   |                    |
| Central Arizona Bank        |   | Central Arizona Bank    |
| Sunrise Bank of Albuquerque |   |                    |
| 1st Commerce Bank           |   |                    |
| Pisgah Community Bank       |   |                    |

----

|                                                                     |   |          | March 31, |    |   |   | December 31,  |   |
|--------------------------------------------------------------------------|--------|---------------|-----------|---------|--------|--------|---------------|--------|
|                                                                     |   |          | 2011      |    |   |   | 2010          |   |
| Tier 1 capital to average adjusted total assets:                         |   |          |      |    |   |   |          |   |
| Minimum required amount(1)                                               |   |  ≥ | $         | 133,648 |   |   |  ≥ | $      | 155,224 |   |
| Actual amount                                                            |   |          | $         | (39,618 | )      |   |          | $      | (39,980 | ) |
| Ratio                                                                    |   |          |      | (1.19   | )%     |   |          |   | (1.03 | )% |
|                                                                     |   |          |      |    |   |   |          |   |   |   |
| Tier 1 capital to risk-weighted assets:                                  |   |          |      |    |   |   |          |   |   |   |
| Minimum required amount(2)                                               |   |  ≥ | $         | 100,366 |   |   |  ≥ | $      | 110,909 |   |
| Actual amount                                                            |   |          | $         | (39,618 | )      |   |          | $      | (39,980 | ) |
| Ratio                                                                    |   |          |      | (1.58   | )%     |   |          |   | (1.44 | )% |
|                                                                     |   |          |      |    |   |   |          |   |   |   |
| Combined Tier 1 and Tier 2 capital to risk-   weighted assets: |   |          |      |    |   |   |          |   |   |   |
| Minimum required amount(3)                                               |   |  ≥ | $         | 200,732 |   |   |  ≥ | $      | 221,818 |   |
| Actual amount                                                            |   |          | $         | (39,618 | )      |   |          | $      | (39,980 | ) |
| Ratio                                                                    |   |          |      | (1.58   | )%     |   |          |   | (1.44 | )% |

| (1) | The minimum required ratio of Tier 1 capital to average adjusted total assets is 4%.                                             |
|-----|----------------------------------------------------------------------------------------------------------------------------------|
| (2) | The minimum required ratio of Tier 1 capital to risk-weighted assets to be considered "adequately-capitalized" is 4%.            |
| (3) | The minimum required ratio of Tier 1 and Tier 2 capital to risk-weighted assets to be considered "adequately-capitalized" is 8%. |

----

|                           |   | March 31, 2011 |      |   | December 31, 2010 |    |
|--------------------------------|--------|----------------|-----------|--------|-------------------|---------|
| Arizona Region:                |   |           |      |   |              |    |
| Bank of Tucson(1)              |   |           |      |   | $                 | 222,882 |   |
| Central Arizona Bank           |   | $              | 70,769    |   |              |    | 75,590 |   |
| Sunrise Bank of Albuquerque    |   |           | 64,623    |   |              |    | 73,539 |   |
| Sunrise Bank of Arizona        |   |           | 391,375   |   |              |    | 353,154 |   |
| Arizona Region Total           |   |           | 526,767   |   |              |    | 725,165 |   |
|                           |   |           |      |   |              |    |   |   |
| California Region:             |   |           |      |   |              |    |   |   |
| Bank of Feather River          |   |           | 41,245    |   |              |    | 38,930 |   |
| Sunrise Bank                   |   |           | 232,003   |   |              |    | 231,836 |   |
| California Region Total        |   |           | 273,248   |   |              |    | 270,766 |   |
|                           |   |           |      |   |              |    |   |   |
| Colorado Region:               |   |           |      |   |              |    |   |   |
| Mountain View Bank of Commerce |   |           | 60,424    |   |              |    | 60,303 |   |
|                           |   |           |      |   |              |    |   |   |
| Great Lakes Region:            |   |           |      |   |              |    |   |   |
| Bank of Maumee                 |   |           | 38,820    |   |              |    | 40,300 |   |
| Bank of Michigan               |   |           | 79,916    |   |              |    | 81,873 |   |
| Capitol National Bank          |   |           | 158,116   |   |              |    | 157,606 |   |
| Evansville Commerce Bank       |   |           | 48,436    |   |              |    | 52,506 |   |
| Indiana Community Bank         |   |           | 129,078   |   |              |    | 128,728 |   |
| Michigan Commerce Bank         |   |           | 884,477   |   |              |    | 933,698 |   |
| Great Lakes Region Total       |   |           | 1,338,843 |   |              |    | 1,394,711 |   |
|                           |   |           |      |   |              |    |   |   |
| Nevada Region:                 |   |           |      |   |              |    |   |   |
| 1st Commerce Bank              |   |           | 34,513    |   |              |    | 39,555 |   |
| Bank of Las Vegas              |   |           | 351,889   |   |              |    | 375,084 |   |
| Nevada Region Total            |   |           | 386,402   |   |              |    | 414,639 |   |
|                           |   |           |      |   |              |    |   |   |
| Northwest Region:              |   |           |      |   |              |    |   |   |
| Bank of the Northwest          |   |           | 146,388   |   |              |    | 145,540 |   |
| High Desert Bank               |   |           | 35,608    |   |              |    | 37,967 |   |
| Northwest Region Total         |   |           | 181,996   |   |              |    | 183,507 |   |
|                           |   |           |      |   |              |    |   |   |
| Southeast Region:              |   |           |      |   |              |    |   |   |
| Community Bank of Rowan(1)     |   |           | 134,501   |   |              |    | 140,276 |   |
| First Carolina State Bank      |   |           | 99,176    |   |              |    | 103,254 |   |
| Pisgah Community Bank          |   |           | 37,254    |   |              |    | 43,125 |   |
| Sunrise Bank                   |   |           | 106,007   |   |              |    | 112,718 |   |
| Southeast Region Total         |   |           | 376,938   |   |              |    | 399,373 |   |

----

|                                            |   | March 31, 2011 |      |   | December 31, 2010 |   |
|-------------------------------------------------|--------|----------------|-----------|--------|-------------------|--------|
| Texas Region:                                   |   |           |      |   |              |   |
| Bank of Fort Bend(1)                            |   |           |      |   | $                 | 35,375 |   |
| Bank of Las Colinas                             |   | $              | 49,949    |   |              |   | 44,767 |   |
| Texas Region Total                              |   |           | 49,949    |   |              |   | 80,142 |   |
|                                            |   |           |      |   |              |   |   |   |
| Parent company and other, net                   |   |           | 2,395     |   |              |   | 11,608 |   |
|                                            |   |           |      |   |              |   |   |   |
| Consolidated totals                             |   |           | 3,196,962 |   |              |   | 3,540,214 |   |
| Less discontinued operations                    |   |           | (134,501  | )      |              |   | (398,533 | ) |
|                                            |   |           |      |   |              |   |   |   |
| Consolidated totals—continuing operations |   | $              | 3,062,461 |   |              | $      | 3,141,681 |   |

| (1) | Capitol sold its ownership in Community Bank of Rowan effective April 19, 2011; Bank of Fort Bend effective March 30, 2011 and Bank of Tucson effective January 24, 2011.  The banks' operations have been included in Capitol's consolidated totals up to the date of sale; however, the banks' results are reflected in discontinued operations. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

|                                                 |   |                  |      |   | Allowance for |    |      |                |   |   | Allowance as a Percentage |   |
|------------------------------------------------------|--------|-----------------------|-----------|--------|---------------|---------|-----------|---------------------|--------|--------|---------------------------|--------|
|                                                 |   | Total Portfolio Loans |      |   | Loan Losses   |    |      | Nonperforming Loans |   |   | of Total Portfolio Loans  |   |
|                                                 |   | March 31,2011         |      |   | Dec 31,2010   |    |      | March 31,2011       |   |   | Dec 31,2010               |   |   | March 31,2011 |   |   | Dec 31,2010 |   |   | March 31,2011 |   |   | Dec 31,2010 |   |
| Arizona Region:                                      |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Tucson(1)                                    |   |                  |      |   | $             | 159,334 |      |                |   |   |                      | $      | 2,380 |   |   |   |   |   | $ | 7,711 |   |   |   |   |   |   | 1.49 | % |
| Central Arizona Bank                                 |   | $                     | 48,442    |   |          |    | 52,844    |                |   | $      | 2,031                     |   |   |   | 2,552 |   |   | $ | 3,986 |   |   |   | 5,092 |   |   |   | 4.19 | % |   |   | 4.83 | % |
| Sunrise Bank of Albuquerque                          |   |                  | 50,051    |   |          |    | 52,502    |                |   |   | 2,692                     |   |   |   | 2,499 |   |   |   | 3,986 |   |   |   | 4,731 |   |   |   | 5.38 | % |   |   | 4.76 | % |
| Sunrise Bank of Arizona                              |   |                  | 288,155   |   |          |    | 264,181   |                |   |   | 16,740                    |   |   |   | 16,700 |   |   |   | 29,507 |   |   |   | 29,936 |   |   |   | 5.81 | % |   |   | 6.32 | % |
| Arizona Region Total                                 |   |                  | 386,648   |   |          |    | 528,861   |                |   |   | 21,463                    |   |   |   | 24,131 |   |   |   | 37,479 |   |   |   | 47,470 |   |   |   | 5.55 | % |   |   | 4.56 | % |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| California Region:                                   |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Feather River                                |   |                  | 33,167    |   |          |    | 31,297    |                |   |   | 501                       |   |   |   | 479 |   |   |   |   |   |   |   |   |   |   |   | 1.51 | % |   |   | 1.53 | % |
| Sunrise Bank                                         |   |                  | 182,870   |   |          |    | 183,641   |                |   |   | 7,554                     |   |   |   | 7,815 |   |   |   | 6,920 |   |   |   | 8,529 |   |   |   | 4.13 | % |   |   | 4.26 | % |
| California Region Total                              |   |                  | 216,037   |   |          |    | 214,938   |                |   |   | 8,055                     |   |   |   | 8,294 |   |   |   | 6,920 |   |   |   | 8,529 |   |   |   | 3.73 | % |   |   | 3.86 | % |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Colorado Region:                                     |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Mountain View Bank of Commerce                       |   |                  | 42,882    |   |          |    | 41,087    |                |   |   | 803                       |   |   |   | 789 |   |   |   | 879 |   |   |   | 883 |   |   |   | 1.87 | % |   |   | 1.92 | % |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Great Lakes Region:                                  |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Maumee                                       |   |                  | 32,299    |   |          |    | 33,558    |                |   |   | 1,422                     |   |   |   | 1,427 |   |   |   | 715 |   |   |   | 442 |   |   |   | 4.40 | % |   |   | 4.25 | % |
| Bank of Michigan                                     |   |                  | 63,133    |   |          |    | 64,278    |                |   |   | 1,501                     |   |   |   | 1,368 |   |   |   | 2,094 |   |   |   | 2,312 |   |   |   | 2.38 | % |   |   | 2.13 | % |
| Capitol National Bank                                |   |                  | 133,598   |   |          |    | 138,251   |                |   |   | 5,063                     |   |   |   | 5,976 |   |   |   | 12,782 |   |   |   | 13,616 |   |   |   | 3.79 | % |   |   | 4.32 | % |
| Evansville Commerce Bank                             |   |                  | 36,074    |   |          |    | 38,609    |                |   |   | 1,029                     |   |   |   | 1,103 |   |   |   | 1,551 |   |   |   | 1,801 |   |   |   | 2.85 | % |   |   | 2.86 | % |
| Indiana Community Bank                               |   |                  | 108,062   |   |          |    | 112,986   |                |   |   | 3,758                     |   |   |   | 3,703 |   |   |   | 7,758 |   |   |   | 8,358 |   |   |   | 3.48 | % |   |   | 3.28 | % |
| Michigan Commerce Bank                               |   |                  | 754,839   |   |          |    | 812,088   |                |   |   | 51,012                    |   |   |   | 57,381 |   |   |   | 105,020 |   |   |   | 114,937 |   |   |   | 6.76 | % |   |   | 7.07 | % |
| Great Lakes Region Total                             |   |                  | 1,128,005 |   |          |    | 1,199,770 |                |   |   | 63,785                    |   |   |   | 70,958 |   |   |   | 129,920 |   |   |   | 141,466 |   |   |   | 5.65 | % |   |   | 5.91 | % |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Nevada Region:                                       |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 1st Commerce Bank                                    |   |                  | 24,229    |   |          |    | 25,521    |                |   |   | 1,658                     |   |   |   | 624 |   |   |   | 4,886 |   |   |   | 5,611 |   |   |   | 6.84 | % |   |   | 2.45 | % |
| Bank of Las Vegas                                    |   |                  | 286,145   |   |          |    | 306,802   |                |   |   | 21,641                    |   |   |   | 25,235 |   |   |   | 77,836 |   |   |   | 82,042 |   |   |   | 7.56 | % |   |   | 8.23 | % |
| Nevada Region Total                                  |   |                  | 310,374   |   |          |    | 332,323   |                |   |   | 23,299                    |   |   |   | 25,859 |   |   |   | 82,722 |   |   |   | 87,653 |   |   |   | 7.51 | % |   |   | 7.78 | % |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Northwest Region:                                    |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of the Northwest                                |   |                  | 118,188   |   |          |    | 118,755   |                |   |   | 4,002                     |   |   |   | 4,000 |   |   |   | 5,610 |   |   |   | 6,609 |   |   |   | 3.39 | % |   |   | 3.37 | % |
| High Desert Bank                                     |   |                  | 28,935    |   |          |    | 29,872    |                |   |   | 1,450                     |   |   |   | 1,350 |   |   |   | 933 |   |   |   | 1,053 |   |   |   | 5.01 | % |   |   | 4.52 | % |
| Northwest Region Total                               |   |                  | 147,123   |   |          |    | 148,627   |                |   |   | 5,452                     |   |   |   | 5,350 |   |   |   | 6,543 |   |   |   | 7,662 |   |   |   | 3.71 | % |   |   | 3.60 | % |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Southeast Region:                                    |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Community Bank of Rowan(1)                           |   |                  | 101,219   |   |          |    | 102,926   |                |   |   | 1,628                     |   |   |   | 1,736 |   |   |   | 4,411 |   |   |   | 3,441 |   |   |   | 1.61 | % |   |   | 1.69 | % |
| First Carolina State Bank                            |   |                  | 73,248    |   |          |    | 77,797    |                |   |   | 3,308                     |   |   |   | 2,389 |   |   |   | 5,775 |   |   |   | 6,560 |   |   |   | 4.52 | % |   |   | 3.07 | % |
| Pisgah Community Bank                                |   |                  | 26,493    |   |          |    | 28,071    |                |   |   | 3,362                     |   |   |   | 1,511 |   |   |   | 7,289 |   |   |   | 6,968 |   |   |   | 12.69 | % |   |   | 5.38 | % |
| Sunrise Bank                                         |   |                  | 74,147    |   |          |    | 79,558    |                |   |   | 3,785                     |   |   |   | 4,374 |   |   |   | 9,441 |   |   |   | 10,452 |   |   |   | 5.40 | % |   |   | 5.50 | % |
| Southeast Region Total                               |   |                  | 275,107   |   |          |    | 288,352   |                |   |   | 12,083                    |   |   |   | 10,010 |   |   |   | 26,916 |   |   |   | 27,421 |   |   |   | 4.39 | % |   |   | 3.47 | % |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Texas Region:                                        |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Fort Bend(1)                                 |   |                  |      |   |          |    | 29,788    |                |   |   |                      |   |   |   | 700 |   |   |   |   |   |   |   | 419 |   |   |   |   |   |   |   | 2.35 | % |
| Bank of Las Colinas                                  |   |                  | 40,772    |   |          |    | 41,434    |                |   |   | 737                       |   |   |   | 737 |   |   |   | 891 |   |   |   | 907 |   |   |   | 1.81 | % |   |   | 1.78 | % |
| Texas Region Total                                   |   |                  | 40,772    |   |          |    | 71,222    |                |   |   | 737                       |   |   |   | 1,437 |   |   |   | 891 |   |   |   | 1,326 |   |   |   | 1.81 | % |   |   | 2.02 | % |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Parent company and other, net                        |   |                  | 4,992     |   |          |    | 5,866     |                |   |   | 2,632                     |   |   |   | 2,973 |   |   |   | 2,834 |   |   |   | 3,170 |   |   |   | 52.72 | % |   | n.m. |   |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated totals                                  |   |                  | 2,551,940 |   |          |    | 2,831,046 |                |   |   | 138,309                   |   |   |   | 149,801 |   |   |   | 295,104 |   |   |   | 325,580 |   |   |   | 5.42 | % |   |   | 5.29 | % |
| Less discontinued operations                         |   |                  | (101,219  | )      |          |    | (292,048  | )                   |   |   | (1,628                    | )      |   |   | (4,816 | ) |   |   | (4,411 | ) |   |   | (11,571 | ) |   |   |   |   |   |   | (1.49 | )% |
|                                                 |   |                  |      |   |          |    |      |                |   |   |                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated totals relating tocontinuing operations |   | $                     | 2,450,721 |   |          | $       | 2,538,998 |                |   | $      | 136,681                   |   |   | $ | 144,985 |   |   | $ | 290,693 |   |   | $ | 314,009 |   |   |   | 5.58 | % |   |   | 5.71 | % |

| (1)        | Capitol sold its ownership in Community Bank of Rowan effective April 19, 2011; Bank of Fort Bend effective March 30, 2011 and Bank of Tucson effective January 24, 2011.  The banks' operations have been included in Capitol's consolidated totals up to the date of sale; however, the banks' results are reflected in discontinued operations. |
|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| n.m.  | Not meaningful.                                                                                                                                                                                                                                                                                                                                         |

----

----

|                                                                           |   | Three Months Ended March 31 |   |
|--------------------------------------------------------------------------------|--------|-----------------------------|--------|
|                                                                           |   | 2011                        |   |   | 2010(1) |   |
|                                                                           |   |                        |   |   |   |   |
| Impairment loss                                                                |   | $                           | 1,600  |   |   |   |   |
| Legal fees                                                                     |   |                        | 896    |   |   | $ | 941 |   |
| Insurance                                                                      |   |                        | 790    |   |   |   | 275 |   |
| Loan and collection expense                                                    |   |                        | 508    |   |   |   | 898 |   |
| Professional fees                                                              |   |                        | 465    |   |   |   | 2,042 |   |
| Bank services (ATMs, telephone    banking and Internet banking) |   |                        | 366    |   |   |   | 306 |   |
| Directors' fees                                                                |   |                        | 300    |   |   |   | 392 |   |
| Paper, printing and supplies                                                   |   |                        | 293    |   |   |   | 349 |   |
| Communications                                                                 |   |                        | 282    |   |   |   | 299 |   |
| Advertising                                                                    |   |                        | 278    |   |   |   | 366 |   |
| Travel, lodging and meals                                                      |   |                        | 247    |   |   |   | 246 |   |
| Other                                                                          |   |                        | 1,775  |   |   |   | 577 |   |
|                                                                           |   |                        |   |   |   |   |   |   |
| Total                                                                          |   | $                           | 7,800  |   |   | $ | 6,691 |   |

----

|   | MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION |
|--------|-------------------------------------------------------------|

|                              |   | Total Revenues |   |   | Net Income (Loss)(1) |   |        | Return onAverage Equity(2) |   |   | Return onAverage Assets(2) |   |
|-----------------------------------|--------|----------------|--------|--------|----------------------|--------|-------------|----------------------------|--------|--------|----------------------------|--------|
|                              |   | 2011           |   |   | 2010                 |   |        | 2011                       |   |   | 2010                       |   |   | 2011 |   |   | 2010 |   |   | 2011 |   |   | 2010 |   |
| Arizona Region:                   |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Tucson(3)                 |   |           |   |   | $                    | 3,189  |        |                       |   |   |                       | $      | 633 |   |   |   |   |   |   | 13.12 | % |   |   |   |   |   | 1.21 | % |
| Central Arizona Bank              |   | $              | 729    |   |                 |   | 631         |                       |   | $      | (663                       | )      |   |   | (1,011 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Southern Arizona CommunityBank(3) |   |           |   |   |                 |   |  1,230 |                       |   |   |                       |   |   |   |  203 |   |   |   |   |   |   | 8.45 | % |   |   |   |   |   | 0.86 | % |
| Sunrise Bank of Albuquerque       |   |           | 805    |   |                 |   | 957         |                       |   |   | (734                       | )      |   |   | (677 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Sunrise Bank of Arizona           |   |           | 5,397  |   |                 |   | 3,787       |                       |   |   | (2,506                     | )      |   |   | (16,180 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Arizona Region Total              |   |           | 6,931  |   |                 |   | 9,794       |                       |   |   | (3,903                     | )      |   |   | (17,032 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                              |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| California Region:                |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Feather River             |   |           | 636    |   |                 |   | 566         |                       |   |   | 14                         |   |   |   | 30 |   |   |   | 0.90 | % |   |   | 1.98 | % |   |   | 0.14 | % |   |   | 0.36 | % |
| Bank of San Francisco(3)          |   |           |   |   |                 |   | 1,356       |                       |   |   |                       |   |   |   | 160 |   |   |   |   |   |   |   | 7.54 | % |   |   |   |   |   |   | 0.71 | % |
| Napa Community Bank(3)            |   |           |   |   |                 |   | 2,224       |                       |   |   |                       |   |   |   | (219 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Sunrise Bank                      |   |           | 2,899  |   |                 |   | 3,431       |                       |   |   | 542                        |   |   |   | (1,480 | ) |   |   | 10.99 | % |   |   |   |   |   |   | 0.96 | % |   |   |   |   |
| California Region Total           |   |           | 3,535  |   |                 |   | 7,577       |                       |   |   | 556                        |   |   |   | (1,509 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                              |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Colorado Region:                  |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fort Collins Commerce Bank(3)     |   |           |   |   |                 |   | 1,434       |                       |   |   |                       |   |   |   | 86 |   |   |   |   |   |   |   | 3.63 | % |   |   |   |   |   |   | 0.37 | % |
| Larimer Bank of Commerce(3)       |   |           |   |   |                 |   | 1,330       |                       |   |   |                       |   |   |   | 55 |   |   |   |   |   |   |   | 2.77 | % |   |   |   |   |   |   | 0.25 | % |
| Loveland Bank of Commerce(3)      |   |           |   |   |                 |   | 573         |                       |   |   |                       |   |   |   | 34 |   |   |   |   |   |   |   | 2.17 | % |   |   |   |   |   |   | 0.34 | % |
| Mountain View Bank of Commerce    |   |           | 690    |   |                 |   | 677         |                       |   |   | 33                         |   |   |   | 41 |   |   |   | 1.82 | % |   |   | 2.31 | % |   |   | 0.22 | % |   |   | 0.33 | % |
| Colorado Region Total             |   |           | 690    |   |                 |   | 4,014       |                       |   |   | 33                         |   |   |   | 216 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                              |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Great Lakes Region:               |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Maumee                    |   |           | 535    |   |                 |   | 633         |                       |   |   | (26                        | )      |   |   | (138 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Michigan                  |   |           | 1,223  |   |                 |   | 1,155       |                       |   |   | 37                         |   |   |   | (175 | ) |   |   | 2.15 | % |   |   |   |   |   |   | 0.19 | % |   |   |   |   |
| Capitol National Bank             |   |           | 2,192  |   |                 |   | 2,604       |                       |   |   | 27                         |   |   |   | (642 | ) |   |   | 1.02 | % |   |   |   |   |   |   | 0.07 | % |   |   |   |   |
| Evansville Commerce Bank          |   |           | 613    |   |                 |   | 706         |                       |   |   | (45                        | )      |   |   | (150 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Indiana Community Bank            |   |           | 1,690  |   |                 |   | 1,999       |                       |   |   | (268                       | )      |   |   | (424 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Michigan Commerce Bank            |   |           | 14,311 |   |                 |   | 15,673      |                       |   |   | (7,123                     | )      |   |   | (27,308 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Ohio Commerce Bank(3)             |   |           |   |   |                 |   | 1,011       |                       |   |   |                       |   |   |   | 128 |   |   |   |   |   |   |   | 5.42 | % |   |   |   |   |   |   | 0.75 | % |
| Great Lakes Region Total          |   |           | 20,564 |   |                 |   | 23,781      |                       |   |   | (7,398                     | )      |   |   | (28,709 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                              |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Midwest Region                    |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Adams Dairy Bank(3)               |   |           |   |   |                 |   | 626         |                       |   |   |                       |   |   |   | (110 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Belleville(3)             |   |           |   |   |                 |   | 785         |                       |   |   |                       |   |   |   | 12 |   |   |   |   |   |   |   | 0.68 | % |   |   |   |   |   |   | 0.07 | % |
| Community Bank of Lincoln(3)      |   |           |   |   |                 |   | 658         |                       |   |   |                       |   |   |   | (202 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Midwest Region Total              |   |           |   |   |                 |   | 2,069       |                       |   |   |                       |   |   |   | (300 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                              |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Nevada Region:                    |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 1st Commerce Bank                 |   |           | 335    |   |                 |   | 483         |                       |   |   | (1,778                     | )      |   |   | (725 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Las Vegas                 |   |           | 3,743  |   |                 |   | 4,973       |                       |   |   | (695                       | )      |   |   | (9,381 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Nevada Region Total               |   |           | 4,078  |   |                 |   | 5,456       |                       |   |   | (2,473                     | )      |   |   | (10,106 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                              |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Northeast Region:                 |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| USNY Bank(3)                      |   |           |   |   |                 |   | 1,004       |                       |   |   |                       |   |   |   | 203 |   |   |   |   |   |   |   | 15.63 | % |   |   |   |   |   |   | 1.27 | % |
|                              |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Northwest Region:                 |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of the Northwest             |   |           | 1,853  |   |                 |   | 2,079       |                       |   |   | 81                         |   |   |   | (731 | ) |   |   | 2.17 | % |   |   |   |   |   |   | 0.23 | % |   |   |   |   |
| High Desert Bank                  |   |           | 492    |   |                 |   | 563         |                       |   |   | (320                       | )      |   |   | (291 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Northwest Region Total            |   |           | 2,345  |   |                 |   | 2,642       |                       |   |   | (239                       | )      |   |   | (1,022 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                              |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Southeast Region:                 |   |           |   |   |                 |   |        |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Community Bank of Rowan(3)(4)     |   |           | 1,550  |   |                 |   |        |                       |   |   | (71                        | )      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 0.47 | % |
| First Carolina State Bank         |   |           | 1,018  |   |                 |   | 1,133       |                       |   |   | (2,120                     | )      |   |   | (782 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Pisgah Community Bank             |   |           | 353    |   |                 |   | 541         |                       |   |   | (2,385                     | )      |   |   | (6,542 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Sunrise Bank                      |   |           | 1,261  |   |                 |   | 1,703       |                       |   |   | (1,002                     | )      |   |   | (1,528 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Southeast Region Total            |   |           | 4,182  |   |                 |   | 3,377       |                       |   |   | (5,578                     | )      |   |   | (8,852 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

|                                                      |   | Total Revenues |   |   | Net Income (Loss)(1) |   |    | Return onAverage Equity(2) |   |   | Return onAverage Assets(2) |   |
|-----------------------------------------------------------|--------|----------------|--------|--------|----------------------|--------|---------|----------------------------|--------|--------|----------------------------|--------|
|                                                      |   | 2011           |   |   | 2010                 |   |    | 2011                       |   |   | 2010                       |   |   | 2011 |   |   | 2010 |   |   | 2011 |   |   | 2010 |   |
| Texas Region:                                             |   |           |   |   |                 |   |    |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Fort Bend(3)                                      |   | $              | 720    |   |                 | $      | 494     |                       |   | $      | 128                        |   |   | $ | (50 | ) |   |   | 14.82 | % |   |   |   |   |   |   | 2.27 | % |   |   |   |   |
| Bank of Las Colinas                                       |   |           | 613    |   |                 |   | 513     |                       |   |   | 38                         |   |   |   | (43 | ) |   |   | 2.78 | % |   |   |   |   |   |   | 0.34 | % |   |   |   |   |
| Texas Region Total                                        |   |           | 1,333  |   |                 |   | 1,007   |                       |   |   | 166                        |   |   |   | (93 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   |           |   |   |                 |   |    |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Parent company and other, net                             |   |           | 19,704 |   |                 |   | 4,161   |                       |   |   | 16,062                     |   |   |   | 5,264 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated totals                                       |   |           | 63,359 |   |                 |   | 64,882  |                       |   |   | (2,774                     | )      |   |   | (61,940 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Less discontinued operations                              |   |           | (6,639 | )      |                 |   | (15,914 | )                          |   |   | 2,896                      |   |   |   | 939 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   |           |   |   |                 |   |    |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated totals for   continuing operations |   | $              | 56,723 |   |                 | $      | 48,968  |                       |   | $      | (5,670                     | )      |   | $ | (62,879 | ) |   |   |   -- |   |   |   |          -- |   |   |   |   -- |   |   |   |         -- |   |

| (1) | Excludes net losses attributable to noncontrolling interests.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | Annualized for periods presented.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| (3) | Capitol sold its ownership in Community Bank of Rowan effective April 19, 2011; Bank of Fort Bend effective March 30, 2011; Bank of Tucson effective January 24, 2011; Southern Arizona community Bank effective December 10, 2010; Fort Collins Commerce Bank, Larimer Bank of Commerce and Loveland Bank of Commerce effective October 29, 2010; Bank of San Francisco effective September 28, 2010; Adams Dairy Bank effective August 31, 2010; USNY Bank effective August 23, 2010; Community Bank of Lincoln effective July 30, 2010; Ohio Commerce Bank effective June 30, 2010; Napa Community Bank effective April 30, 2010 and Bank of Belleville effective April 27, 2010.  The banks' operations have been included in Capitol's consolidated totals up to the date of sale; however, the banks' results are reflected in discontinued operations. |
| (4) | As of December 31, 2009, Community Bank of Rowan (CBR) was a majority-owned subsidiary of Capitol Development Bancorp Limited III (CDBL III) which, due to a change in control effective September 30, 2009, became an unconsolidated affiliate of Capitol.  Effective June 30, 2010, CDBL III transferred its controlling interest in CBR to Capitol in exchange for preferred stock of Capitol and, accordingly, CBR became a consolidated subsidiary of Capitol on that date.                                                                                                                                                                                                                                                                                                                                                                              |

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|                                       |   | Tier 1 Leverage |   |   | Tier 1 Risk-Based   |   |   | Total Risk-Based    |   |   |                         |
|--------------------------------------------|--------|-----------------|--------|--------|---------------------|--------|--------|---------------------|--------|--------|------------------------------|
|                                       |   | Ratio(1)(5)     |   |   | Capital Ratio(1)(5) |   |   | Capital Ratio(2)(5) |   |   | Regulatory Classification(3) |
|                                       |   | Mar 31,2011     |   |   | Dec 31,2010         |   |   | Mar 31,2011         |   |   | Dec 31,2010                  |   |   | Mar 31,2011 |   |   | Dec 31,2010 |   |   | Mar 31,2011 |   | Dec 31,2010 |
| Arizona Region:                            |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |
| Central Arizona Bank                       |   |            | 2.10   | %      |                |   | 2.24   | %                   |   |   | 3.10                         | % |   |   | 3.20 | % |   |   | 4.38 | % |   |   | 4.49 | % |   | significantly-undercapitalized |   | significantly-undercapitalized |
| Sunrise Bank of Albuquerque                |   |            | 2.73   | %      |                |   | 2.43   | %                   |   |   | 3.63                         | % |   |   | 3.39 | % |   |   | 4.93 | % |   |   | 4.68 | % |   | significantly-undercapitalized |   | significantly-undercapitalized |
| Sunrise Bank of Arizona                    |   |            | 2.11   | %      |                |   | 0.69   | %                   |   |   | 2.65                         | % |   |   | 0.92 | % |   |   | 3.95 | % |   |   | 1.84 | % |   | significantly-undercapitalized |   | critically-undercapitalized(7) |
|                                       |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| California Region:                         |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Feather River                      |   |            | 15.81  | %      |                |   | 16.08  | %                   |   |   | 21.34                        | % |   |   | 21.16 | % |   |   | 22.60 | % |   |   | 22.42 | % |   | well-capitalized |   | well-capitalized |
| Sunrise Bank                               |   |            | 8.19   | %      |                |   | 7.04   | %                   |   |   | 10.42                        | % |   |   | 9.93 | % |   |   | 11.71 | % |   |   | 11.22 | % |   | adequately-capitalized(6) |   | adequately-capitalized(6) |
|                                       |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Colorado Region:                           |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Mountain View Bank of   Commerce |   |            | 11.92  | %      |                |   | 12.02  | %                   |   |   | 17.36                        | % |   |   | 17.99 | % |   |   | 18.61 | % |   |   | 19.25 | % |   |  well-capitalized |   |  well-capitalized |
|                                       |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Great Lakes Region:                        |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Maumee                             |   |            | 7.47   | %      |                |   | 7.00   | %                   |   |   | 9.68                         | % |   |   | 9.43 | % |   |   | 10.98 | % |   |   | 10.72 | % |   | well-capitalized |   | well-capitalized |
| Bank of Michigan                           |   |            | 8.44   | %      |                |   | 7.67   | %                   |   |   | 10.73                        | % |   |   | 10.33 | % |   |   | 12.00 | % |   |   | 11.59 | % |   | well-capitalized |   | well-capitalized |
| Capitol National Bank                      |   |            | 6.45   | %      |                |   | 6.10   | %                   |   |   | 7.96                         | % |   |   | 7.74 | % |   |   | 9.24 | % |   |   | 9.03 | % |   | adequately-capitalized |   | adequately-capitalized |
| Evansville Commerce Bank                   |   |            | 8.59   | %      |                |   | 8.47   | %                   |   |   | 12.91                        | % |   |   | 12.25 | % |   |   | 14.19 | % |   |   | 13.52 | % |   | well-capitalized |   | well-capitalized |
| Indiana Community Bank                     |   |            | 6.50   | %      |                |   | 6.34   | %                   |   |   | 8.32                         | % |   |   | 8.19 | % |   |   | 9.60 | % |   |   | 9.47 | % |   | adequately-capitalized |   | adequately-capitalized |
| Michigan Commerce Bank                     |   |            | 2.05   | %      |                |   | 1.15   | %                   |   |   | 2.56                         | % |   |   | 1.46 | % |   |   | 3.88 | % |   |   | 2.78 | % |   | significantly-undercapitalized |   | critically-undercapitalized(7) |
|                                       |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Nevada Region:                             |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| 1st Commerce Bank                          |   |            | 2.34   | %      |                |   | 2.48   | %                   |   |   | 3.56                         | % |   |   | 3.94 | % |   |   | 4.88 | % |   |   | 5.20 | % |   | significantly-undercapitalized |   | significantly-undercapitalized |
| Bank of Las Vegas                          |   |            | 2.20   | %      |                |   | 2.06   | %                   |   |   | 2.85                         | % |   |   | 2.93 | % |   |   | 4.18 | % |   |   | 4.27 | % |   | significantly-undercapitalized |   | significantly-undercapitalized |
|                                       |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Northwest Region:                          |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of the Northwest                      |   |            | 10.49  | %      |                |   | 10.05  | %                   |   |   | 13.41                        | % |   |   | 13.25 | % |   |   | 14.69 | % |   |   | 14.52 | % |   | adequately-capitalized(6) |   | adequately-capitalized(6) |
| High Desert Bank                           |   |            | 6.78   | %      |                |   | 7.83   | %                   |   |   | 9.46                         | % |   |   | 10.07 | % |   |   | 10.76 | % |   |   | 11.36 | % |   | adequately-capitalized(6) |   | adequately-capitalized(6) |
|                                       |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Southeast Region:                          |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Community Bank of Rowan                    |   |            | 6.84   | %      |                |   | 6.83   | %                   |   |   | 9.55                         | % |   |   | 10.05 | % |   |   | 10.81 | % |   |   | 11.30 | % |   | well-capitalized |   | well-capitalized |
| First Carolina State Bank                  |   |            | 2.19   | %      |                |   | 3.11   | %                   |   |   | 3.24                         | % |   |   | 4.75 | % |   |   | 4.53 | % |   |   | 6.02 | % |   | significantly-undercapitalized |   | undercapitalized |
| Pisgah Community Bank(4)                   |   |            | 2.48   | %      |                |   | 2.03   | %                   |   |   | 3.62                         | % |   |   | 3.52 | % |   |   | 5.00 | % |   |   | 4.82 | % |   | significantly-undercapitalized |   | significantly-undercapitalized |
| Sunrise Bank                               |   |            | 2.02   | %      |                |   | 2.14   | %                   |   |   | 3.03                         | % |   |   | 3.29 | % |   |   | 4.33 | % |   |   | 4.59 | % |   | significantly-undercapitalized |   | significantly-undercapitalized |
|                                       |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Texas Region:                              |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bank of Las Colinas                        |   |            | 12.17  | %      |                |   | 11.58  | %                   |   |   | 14.71                        | % |   |   | 14.46 | % |   |   | 15.97 | % |   |   | 15.72 | % |   | well-capitalized |   | well-capitalized |
|                                       |   |            |   |   |                |   |   |                |   |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated totals                        |   |            | (1.19  | )%     |                |   | (1.03  | )%                  |   |   | (1.58                        | )% |   |   | (1.44 | )% |   |   | (1.58 | )% |   |   | (1.44 | )% |   | less than adequately-capitalized |   | less than adequately-capitalized |

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| (1) | The minimum required Tier 1 leverage ratio and Tier 1 risk-based capital ratio is 4% (8% for de novo institutions).                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | The minimum required total risk-based capital ratio is 8%.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| (3) | In order to be classified as a "well-capitalized" institution, the total risk-based capital ratio must be 10% or more.  To be classified as an "adequately-capitalized" institution, the total risk-based capital ratio must be between 8% and 10%.  Institutions are classified as "undercapitalized" when the total risk-based ratio is between 6% and 8% and "significantly-undercapitalized" when such ratio falls below 6%.  Institutions with a Tier 1 leverage ratio below 2% are classified as "critically-undercapitalized." |
| (4) | De novo institution which is subject to higher minimum ratio requirements as noted in (1) above for up to the first three years of operations.                                                                                                                                                                                                                                                                                                                                                                                                                      |
| (5) | Ratios are based on the banks' regulatory reports filed on or before April 30, 2011.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| (6) | Institution is subject to a regulatory agreement and, accordingly, cannot be classified better than "adequately-capitalized" even though the risk-based capital ratios would otherwise suggest "well-capitalized" classification.                                                                                                                                                                                                                                                                                                                                   |
| (7) | Subsequent capital contributions in January 2011 eliminated the banks' classification as "critically-undercapitalized" in 2011.                                                                                                                                                                                                                                                                                                                                                                                                                                     |

| ·   | An equity deficit approximating $39 million; |
|--------------------|----------------------------------------------|

| ·   | Regulatory capital classification on a consolidated basis as less than "adequately-capitalized" and related negative amounts and ratios; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------|

| · | Numerous banking subsidiaries with regulatory capital classification as "undercapitalized" or "significantly-undercapitalized"; |
|--------|---------------------------------------------------------------------------------------------------------------------------------|

|          ·   | Certain banking subsidiaries which are generally subject to formal regulatory agreements have received "prompt corrective action" notifications and/or directives from the FDIC, which require timely action by bank management and the respective boards of directors to resolve regulatory capital ratios which result in classification as less than "adequately-capitalized" (the basis of a PCAN) or to submit an acceptable capital restoration plan to the FDIC (the basis of a PCAD), and it is likely additional PCANs and/or PCADs may be issued in the future and/or the banking subsidiaries may be unable to satisfactorily resolve such notices and/or directives; |
|--------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| ·   | In 2010 and early 2011, Capitol sold several of its banking subsidiaries and has other divestiture transactions pending (see Note J to the accompanying condensed consolidated financial statements).  The proceeds from those divestitures have been redeployed at certain remaining banking subsidiaries which have experienced a significant erosion of capital due to operating losses.  While such proceeds have been a significant source of funds for redeployment, the Corporation will need to raise significant other sources of new capital in the future; |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | The Corporation and substantially all of its banking subsidiaries are operating under various regulatory agreements (formal and informal) which place a number of restrictions on them and impose other requirements limiting activities, requiring preservation of capital, improvement in regulatory capital measures, reduction of nonperforming assets and other things for which the entities have not achieved full compliance; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Elevated levels of nonperforming loans and other nonperforming assets as a percentage of consolidated loans and total assets, respectively; and |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Significant losses from continuing operations in 2011, 2010, 2009 and 2008, resulting primarily from provisions for loan losses, costs associated with foreclosed properties and other real estate owned and, in 2010, an impairment charge to operations for the write-off of previously-recorded goodwill ($64.5 million). |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | An offer to exchange all outstanding trust-preferred securities; |
|--------------------|------------------------------------------------------------------|

| ·   | Amendment to Capitol's articles of incorporation to authorize additional shares of common stock; |
|--------------------|--------------------------------------------------------------------------------------------------|

| ·   | A potential shareholder rights offering; and |
|--------------------|----------------------------------------------|

| ·   | A potential reverse stock split. |
|--------------------|----------------------------------|

| ·   | Raising significant amounts of new capital; |
|--------------------|---------------------------------------------|

| ·   | Completion of divestitures which are currently pending; |
|--------------------|---------------------------------------------------------|

| ·   | A shareholder rights offering; |
|--------------------|--------------------------------|

| ·   | Further reductions in nonperforming assets; |
|--------------------|---------------------------------------------|

| ·   | Stabilization of provisions for loan losses and impairment losses; |
|--------------------|--------------------------------------------------------------------|

| ·   | Resuscitation of Capitol's trust-preferred securities as a qualifying element of regulatory capital and/or equity; and |
|--------------------|------------------------------------------------------------------------------------------------------------------------|

| ·   | Further reductions in operating expenses through mergers of bank subsidiaries completed in recent years. |
|--------------------|----------------------------------------------------------------------------------------------------------|

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----

|                                  |             |   | Sale     |   |   |   |   |
|---------------------------------------|------------------|--------|----------|--------|--------|--------|--------|
|                                  | Date Sold        |   | Proceeds |   |   | Gain   |   |
|                                  |             |   |     |   |   |   |   |
| Bank of Tucson – main office(1) | January 24, 2011 |   | $        | 4,567  |   |   | $      | 4,186 |   |
| Bank of Fort Bend(2)                  | March 30, 2011   |   |     | 4,302  |   |   |   | 1,432 |   |
|                                  |             |   |     |   |   |   |   |   |   |
|                                  |             |   | $        | 8,869  |   |   | $      | 5,618 |   |

|   | (1) | Previously a wholly-owned subsidiary of Capitol.  Sale proceeds represent the net premium received from the assumption of liabilities and acquisition of assets transaction. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Previously a majority-owned subsidiary of a bank-development subsidiary controlled by Capitol. |
|--------|-----|------------------------------------------------------------------------------------------------|

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| Item 1.  | Legal Proceedings. Capitol and its subsidiaries are parties to certain ordinary, routine litigation incidental to their business.  In the opinion of management, liabilities arising from such litigation would not have a material effect on Capitol's consolidated financial position or results of operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Item 1A. | Risk Factors. There were no material changes from the risk factors set forth in Part I, Item 1A, "Risk Factors," of Capitol's Form 10-K for the year ended December 31, 2010 during the three months ended March 31, 2011.  Refer to that section of Capitol's Form 10-K for disclosures regarding the risks and uncertainties related to Capitol's business. In addition to the foregoing, additional risk factors in the current operating environment exist: If Capitol continues to experience significant net losses, it may be difficult to continue to operate as a going concern. During 2010 and the interim period of 2011, Capitol has incurred significant net losses from continuing operations, primarily resulting from additional loan losses associated with a continuing uncertain economy and operating environment.  Those operating losses have resulted in a significant erosion of capital and regulatory matters which are discussed elsewhere in this document. Capitol's ability to continue to operate as a going concern is contingent upon a number of factors which include, but are not limited to, the following:                                             ·  Significant proceeds from pending future bank sales to enable timely deployment to improve capital adequacy at remaining bank                                                    subsidiaries, in addition to raising additional capital from other sources at the parent-company level;·  Future abatement of loan losses and losses associated with other nonperforming assets;·  Future reduction in operating expenses;·  Future improvement in net interest margin and sources of noninterest income; and·  Future conversion of nonperforming assets into earning assets.  |
| Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|     | (a)          None.(b)          Not applicable.(c)          None.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Item 3.  | Defaults Upon Senior Securities. None.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Item 4.  | [Removed and Reserved.]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Item 5.  | Other Information. Adoption of the 2011 Equity Incentive Plan On May 9, 2011, the board of directors of Capitol adopted and approved the Capitol Bancorp Ltd. 2011 Equity Incentive Plan (the 2011 Plan), a copy of which is attached as Exhibit 10.1 to this Form 10-Q.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |

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| Item 5. | Other Information. – Continued Description of the 2011 Equity Incentive Plan The material features of the 2011 Plan are outlined below.  This summary is qualified in its entirety by reference to the complete text of the 2011 Plan.  You are urged to read the actual text of the 2011 Plan in its entirety. Background and Purpose The terms of the 2011 Plan provide for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-related awards, and performance awards that may be settled in cash, stock, or other property. The 2011 Plan was adopted to provide a means by which employees, directors, and consultants may be given an opportunity to purchase Capitol's common stock to assist Capitol in retaining the services of such persons, to secure and retain the services of persons capable of filling such positions, and to provide incentives for such persons to exert maximum efforts for Capitol's success. Shares Available for Awards The total number of shares of Capitol's common stock reserved for issuance under the 2011 Plan will consist of: ·  five million (5,000,000) shares, plus ·  the number of shares of Capitol's common stock available for issuance under the 2011 Plan shall automatically increase on January 1st of each year for a period of nine years commencing on January 1, 2012 and ending on (and including) January 1, 2020, in an amount equal to five percent (5%) of the total number of shares of Capitol's common stock outstanding on December 31st of the preceding year.  Notwithstanding the foregoing, the Board may act prior to January 1st of any fiscal year, to provide that there shall be no increase in the share reserve for such fiscal year or that the increase in the share reserve for such fiscal year shall be a lesser number of shares of Capitol's common stock than would otherwise occur pursuant to the preceding sentence. Eligibility The persons eligible to receive awards under the 2011 Plan consist of Capitol's employees, directors and consultants.  However, incentive stock options (ISOs) may be granted under the 2011 Plan only to Capitol's employees, including Capitol's officers who are employees and only if Capitol elects to submit the 2011 Plan to its shareholders for approval. Shareholder Approval Capitol does not currently intend to submit the 2011 Plan to its shareholders.  Notwithstanding the foregoing, Capitol does intend to submit the 2011 Plan for shareholder approval if Capitol desires to issue awards that are intended to satisfy the requirements of (A) Section 162(m) of the Internal Revenue Code of 1986, as amended regarding the exclusion of performance-based compensation from the limit on corporate deductibility of compensation paid to covered employees, (B) Section 422 of the Code regarding "incentive stock options", (C) Rule 16b-3 of the Securities Exchange Act of 1934, as amended or (D) the listing standards of any applicable stock exchange rules on which Capitol seeks to list its securities.   |
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| Item 5. | Other Information. – Continued Administration The 2011 Plan is administered by the board of directors, which may in turn delegate authority to administer the plan to a committee.  The board of directors has delegated administration of the 2011 Plan to the Compensation Committee.  Subject to the terms of the 2011 Plan, the Compensation Committee determines recipients, the numbers and types of stock awards to be granted and the terms and conditions of the stock awards, including the period of their exercisability and vesting.  Subject to the limitations set forth below, the Compensation Committee also determines the exercise price of options granted under the 2011 Plan.  Subject to the terms of the 2011 Plan, the Compensation Committee may delegate to one or more of Capitol's officers the authority to grant stock awards to Capitol's other officers and employees.  Such officer would be able to grant only the total number of stock awards specified by the Compensation Committee and such officer would not be allowed to grant a stock award to himself or herself. Stock Options Stock options are granted pursuant to stock option agreements and the exercise price for an option cannot be less than 100% of the fair market value of the common stock subject to the option on the date of grant.  Options granted under the 2011 Plan vest at the rate specified in the option agreement. In general, the term of stock options granted under the 2011 Plan may not exceed ten years.  Unless the terms of an optionholder's stock option agreement provide for earlier or later termination, if an optionholder's service relationship with Capitol, or any affiliate of Capitol, ceases due to disability or death, the optionholder, or his or her beneficiary, may exercise any vested options for up to 12 months after the date the service relationship ends.  If an optionholder's service relationship with Capitol, or any affiliate of Capitol, ceases for any reason other than disability or death, the optionholder may exercise any vested options for up to three months after the date the service relationship ends, unless the terms of the stock option agreement provide for a longer or shorter period to exercise the option.  In no event may an option be exercised after its expiration date. Acceptable forms of consideration for the purchase of Capitol's common stock issued under the 2011 Plan are determined by the Compensation Committee and may include cash, common stock previously owned by the optionholder, payment through a broker assisted exercise or a net exercise feature, or other legal consideration approved by the Compensation Committee. Generally, an optionholder may not transfer a stock option other than by will or the laws of descent and distribution or a domestic relations order.  However, an optionholder may designate a beneficiary who may exercise the option following the optionholder's death. Limitations The aggregate fair market value, determined at the time of grant, of shares of Capitol's common stock with respect to ISOs that are exercisable for the first time by an optionholder during any calendar year under all of Capitol's stock plans may not exceed $100,000.  The options or portions of options that exceed this limit are treated as nonqualified stock options (NSOs).  No ISO may be granted to any person who, at the time of the grant, owns or is deemed to own stock possessing more than 10% of Capitol's total combined voting power or that of any affiliate unless the following conditions are satisfied: ·  the option exercise price must be at least 110% of the fair market value of the stock subject to the option on the date of grant; and ·  the term of any ISO award must not exceed five years from the date of grant. |
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| Item 5. | Other Information. – Continued Restricted Stock Awards Restricted stock awards are granted pursuant to restricted stock award agreements.  A restricted stock award may be granted in consideration for the recipient's past or future services performed for Capitol or an affiliate of Capitol.  Shares of Capitol's common stock acquired under a restricted stock award may be subject to forfeiture to Capitol in accordance with a vesting schedule to be determined by the Compensation Committee.  Rights to acquire shares of Capitol's common stock under a restricted stock award may be transferred only upon such terms and conditions as are set forth in the restricted stock award agreement. Restricted Stock Unit Awards Restricted stock unit awards are granted pursuant to restricted stock unit award agreements.  Payment of any purchase price may be made in any form permitted under applicable law; however, Capitol settles payments due to a recipient of a restricted stock unit award by delivery of shares of Capitol's common stock, by cash, by a combination of cash and stock as deemed appropriate by the Compensation Committee, or in any other form of consideration determined by the Compensation Committee and set forth in the restricted stock unit award agreement.  Dividend equivalents may be credited in respect of shares of Capitol's common stock covered by a restricted stock unit award.  Restricted stock unit awards may be subject to vesting in accordance with a vesting schedule to be determined by the Compensation Committee.  Except as otherwise provided in the applicable restricted stock unit award agreement, restricted stock units that have not vested will be forfeited upon the participant's termination of continuous service for any reason. Stock Appreciation Rights Stock appreciation rights are granted through a stock appreciation rights agreement.  Each stock appreciation right is denominated in common stock share equivalents.  The strike price of each stock appreciation right is determined by the Compensation Committee or its authorized committee, but shall in no event be less than 100% of the fair market value of the stock subject to the stock appreciation right at the time of grant.  The Compensation Committee may also impose any restrictions or conditions upon the vesting of stock appreciation rights that it deems appropriate.  Stock appreciation rights may be paid in Capitol's common stock or in cash or any combination of the two, or any other form of legal consideration approved by the Compensation Committee.  In general, the term of stock appreciation rights granted under the 2011 Plan may not exceed ten years.  Unless the terms of a recipient's stock appreciation right agreement provide for earlier or later termination, if a stock appreciation right recipient's relationship with Capitol, or any of Capitol's affiliates, ceases for any reason, the recipient may exercise any vested stock appreciation right up to three months from cessation of service. Performance Awards The 2011 Plan provides for the grant of two types of performance awards: performance stock awards and performance cash awards.  Performance awards may be granted, vest or be exercised based upon the attainment during a certain period of time of certain performance goals.  All of Capitol's employees, directors and consultants are eligible to receive performance awards under the 2011 Plan.  The length of any performance period, the performance goals to be achieved during the performance period, and the measure of whether and to what degree such performance goals have been attained shall be determined by the Compensation Committee.  In granting a performance award, the Compensation Committee sets a period of time, or a performance period, over which the attainment of one or more performance goals is measured for the purpose of determining whether the award recipient has a vested right in or to such performance award.  Within the time period prescribed by Section 162(m) of the Code (typically before the 90th day of a performance period), the  |
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| Item 5. | Other Information. – Continued Compensation Committee establishes the performance goals, based upon one or more pre-established performance criteria enumerated in the 2011 Plan and described below.  As soon as administratively practicable following the end of the performance period, the Compensation Committee certifies (in writing) whether the performance goals have been satisfied. Performance awards may be granted under the 2011 Plan only to Capitol's employees, including Capitol's officers who are employees, and only if Capitol elects to submit the 2011 Plan to its shareholders for approval. Other Stock Awards Other forms of stock awards valued in whole or in part with reference to Capitol's common stock may be granted either alone or in addition to other stock awards under the 2011 Plan.  The Compensation Committee and, pursuant to limited authority granted to it, the Non-Officer Stock Award Committee, has the authority to determine the persons to whom and the time or times at which such other stock awards are granted, the number of shares of Capitol's common stock to be granted and all other conditions of such other stock awards.  Other forms of stock awards may be subject to vesting in accordance with a vesting schedule to be determined by the Compensation Committee. Changes to Capital Structure In the event that there is a specified type of change in Capitol's capital structure not involving the receipt of consideration by Capitol, such as a stock split or stock dividend, the number of shares reserved under the 2011 Plan and the number of shares and exercise price or strike price, if applicable, of all outstanding stock awards will be appropriately adjusted. Corporate Transactions In the event of certain corporate transactions, all outstanding stock awards under the 2011 Plan may be assumed, continued or substituted for by any surviving entity.  If the surviving entity elects not to assume, continue or substitute for such awards, the vesting of such stock awards held by persons whose service with Capitol has not terminated generally will be accelerated in full and such stock awards will terminate if and to the extent not exercised at or prior to the effective time of the corporate transaction and Capitol's repurchase rights will generally lapse. Plan Amendments The Compensation Committee has the authority to amend or terminate the 2011 Plan.  However, no amendment or termination of the plan will adversely affect any rights under awards already granted to a participant unless agreed to by the affected participant.  |
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| Item 6. | Exhibits: |
|---------|-----------|

| (a)         | (b)                                                                                                                                 |
|-------------|-------------------------------------------------------------------------------------------------------------------------------------|
| Exhibit No. | Description of Exhibit                                                                                                              |
|        |                                                                                                                                |
| 10.1        | Capitol Bancorp Ltd. 2011 Equity Incentive Plan                                                                                |
| 10.2        | Stock Option Grant Notice Pursuant to the Capitol Bancorp Ltd. 2011 Equity Incentive Plan                                      |
| 10.3        | Stock Option Grant Notice for Senior Management Pursuant to the Capitol Bancorp Ltd. 2011 Equity Incentive Plan                |
| 10.4        | Restricted Stock Agreement Pursuant to the Capitol Bancorp Ltd. 2011 Equity Incentive Plan                                     |
| 10.5        | Restricted Stock Unit Agreement Pursuant to the CapitolBancorp Ltd. 2011 Equity Incentive Plan                                 |
| 10.6        | Stock Appreciation Rights Agreement Pursuant to the Capitol Bancorp Ltd. 2011 Equity Incentive Plan                            |
| 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 Principal Accounting Officer,Marie D. Walker, pursuant to Section 302 of theSarbanes-Oxley Act of 2002.  |
| 32.1        | Certification of Chief Executive Officer, Joseph D. Reid, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.           |
| 32.2        | Certification of Principal Accounting Officer,Marie D. Walker, pursuant to Section 906 of theSarbanes-Oxley Act of 2002.  |

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|                                | CAPITOL BANCORP LTD.(Registrant)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|-------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Date:  May 12, 2011  | /s/ Joseph D. Reid                                                                                              Joseph D. ReidChairman and CEO(principal executive officer)                                            |
| Date:  May 12, 2011  | /s/ Marie D. Walker                                                                                                        Marie D. Walker (principal accounting officer) |

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| Exhibit No. | Description of Exhibit                                                                                                           |
|-------------|---------------------------------------------------------------------------------------------------------------------------------------|
| 10.1        | Capitol Bancorp Ltd. 2011 Equity Incentive Plan                                                                                  |
| 10.2        | Stock Option Grant Notice Pursuant to the Capitol Bancorp Ltd. 2011 Equity Incentive Plan                                        |
| 10.3        | Stock Option Grant Notice for Senior Management Pursuant to the Capitol BancorpLtd. 2011 Equity Incentive Plan                   |
| 10.4        | Restricted Stock Agreement Pursuant to the Capitol Bancorp Ltd. 2011 Equity Incentive Plan                                       |
| 10.5        | Restricted Stock Unit Agreement Pursuant to the Capitol Bancorp Ltd. 2011 Equity Incentive Plan                                  |
| 10.6        | Stock Appreciation Rights Agreement Pursuant to the Capitol Bancorp Ltd. 2011 Equity Incentive Plan                              |
| 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 Principal Accounting Officer, Marie D. Walker, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.  |
| 32.1        | Certification of Chief Executive Officer, Joseph D. Reid, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.             |
| 32.2        | Certification of Principal Accounting Officer, Marie D. Walker, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.       |

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