VantageSouth Bancshares, Inc. Announces Net Income of $3.7 Million and Annualized Loan Growth of 24 Percent in the Second

VantageSouth Bancshares, Inc. Announces Net Income of $3.7 Million and
Annualized Loan Growth of 24 Percent in the Second Quarter of 2013

RALEIGH, N.C., July 30, 2013 (GLOBE NEWSWIRE) -- VantageSouth Bancshares, Inc.
(NYSE MKT:VSB), the holding company for VantageSouth Bank, today reported
unaudited financial results for the quarter ended June 30, 2013. Highlights
for the second quarter of 2013 include the following:

  *Net income was $3.7 million in 2Q 2013 compared to a net loss of $806
    thousand in 1Q 2013 and net income of $338 thousand in 2Q 2012.
  *Operating earnings, which excludes securities gains, a one-time
    acquisition gain, and merger and conversion costs, were $2.8 million in 2Q
    2013 compared to a loss of $422 thousand in 1Q 2013 and earnings of $360
    thousand in 2Q 2012.
  *VSB completed the merger and system conversion of ECB Bancorp, Inc.
    ("ECB") in 2Q 2013. The ECB merger generated a one-time gain of $8.2
    million in 2Q 2013, while merger and system conversion costs totaled $12.0
    million in 2Q 2013 compared to $1.6 million in 1Q 2013 and $6 thousand in
    2Q 2012.
  *Annualized net loan growth was approximately 24 percent in 2Q 2013,
    excluding acquired ECB loans, which was driven by loan originations of
    $154.2 million.
  *Net interest margin expanded to 4.67 percent in 2Q 2013 from 4.24 percent
    in 1Q 2013 and 4.33 percent in 2Q 2012.
  *Operating non-interest income, which excludes a one-time acquisition gain,
    increased to $4.9 million in 2Q 2013 as the Company continued to expand
    its government guaranteed lending and mortgage businesses and acquired a
    merchant banking platform and expanded its deposit-related fee income base
    through the ECB merger.
  *Asset quality continued to improve as nonperforming assets decreased to
    1.33 percent of total assets as of June 30, 2013 from 1.48 percent of
    total assets as of March 31, 2013 and 1.71 percent of total assets as of
    December 31, 2012.
  *Operating efficiency, which represents operating expenses to total
    operating revenues, improved to 75.9 percent in 2Q 2013 from 82.5 percent
    in 1Q 2013 and 82.8 percent in 2Q 2012.
  *Effective July 22, 2013, the Company transferred the listing of its common
    stock to the NYSE MKT, LLC under the ticker symbol "VSB" and changed its
    name from Crescent Financial Bancshares, Inc. to VantageSouth Bancshares,
    Inc.

"We completed the ECB merger and system conversion in the second quarter while
continuing to build on our core business momentum," stated Scott Custer, CEO
of the Company. Mr. Custer continued, "The operating scale provided by the ECB
merger coupled with the hard work of our top-notch associates propelled the
Company in the second quarter and allowed us to improve our financial
performance in almost every aspect, including revenue growth, core loan
growth, net interest margin expansion, improved asset quality, and better
operating efficiency. We are excited about our new markets, associates,
clients, and stockholders in eastern North Carolina and look forward to
serving the banking needs of these communities for many years to come. By
focusing on constantly providing excellent client service and through a
targeted and disciplined acquisition, we made some important strides this
quarter in becoming the bank of choice for businesses, business owners and
professionals in our markets."

ECB Merger

On April 1, 2013, the Company completed the merger of ECB with and into VSB
(the "ECB merger"). The ECB merger was completed pursuant to an Agreement and
Plan of Merger dated as of September 25, 2012 (the "Merger Agreement").
Immediately following the ECB merger, The East Carolina Bank, a wholly-owned
subsidiary of ECB, was merged with and into VantageSouth Bank. Upon the
closing of the ECB merger, each outstanding share of ECB common stock was
converted into the right to receive 3.55 shares of VSB common stock. The
aggregate merger consideration consisted of 10,312,186 shares of VSB common
stock. Based upon the $3.94 per share closing price of VSB common stock on
March 28, 2013, the aggregate purchase price totaled $40.6 million.

Pursuant to the Merger Agreement, the Company agreed to exchange each share of
ECB's Fixed Rate Cumulative Perpetual Preferred Stock, Series A, into one
share of VSB Fixed Rate Cumulative Perpetual Preferred Stock, Series B. At the
closing of the ECB merger, the Company also issued a warrant to purchase
514,693.2 shares of VSB common stock to the U.S. Department of the Treasury
("Treasury") in exchange for the warrant issued by ECB to Treasury on January
16, 2009 to purchase 144,984 shares of ECB's common stock. The warrant
issuance reflects the exchange ratio associated with the ECB merger.

In connection with the ECB merger, the Company applied the acquisition method
of accounting to ECB's balance sheet. Therefore, all acquired assets and
liabilities were adjusted to fair value, and the historical allowance for loan
losses was eliminated. The Company recorded a one-time acquisition gain of
$8.2 million in 2Q 2013, which reflected the amount by which the fair value of
acquired net assets exceeded the combined purchase price and fair value of
non-controlling interests. The Company has a one-year measurement period from
the acquisition date to finalize the recorded fair values of net assets
acquired. The acquisition gain may change if initial fair value estimates are
revised within the measurement period. The acquisition of ECB increased the
Company's total assets by 77 percent, deposits by 81 percent, and
stockholders' equity by 39 percent at the merger date. Therefore, the
Company's results of operations and financial position were significantly
impacted in 2Q 2013 by the ECB merger.

VantageSouth Bank Merger into Crescent

On November 30, 2012, VantageSouth Bank ("Legacy VantageSouth") was merged
with and into Crescent State Bank, a wholly-owned banking subsidiary of
Crescent Financial Bancshares, Inc. ("Crescent"), and the combined bank was
re-branded as VantageSouth Bank. This merger was a combination of commonly
controlled companies since both banks were subsidiaries of Piedmont Community
Bank Holdings, Inc. ("Piedmont"), and it was accounted for in a manner similar
to a pooling of interests transaction. Thus, the Company's financial
statements were retrospectively adjusted to combine the financial condition
and results of operations of Crescent and Legacy VantageSouth from the date
the two companies became commonly controlled.

Further, because of the application of push-down accounting to the books of
Legacy VantageSouth on February 1, 2012 when Piedmont purchased the bank's
remaining non-controlling equity interests, reporting periods prior to this
date are denoted as "2012 Predecessor Period" (January 1 to January 31, 2012)
and periods after this date are denoted as "2012 Successor Period" (February 1
to June 30, 2012).

Results of Operations

2Q 2013 compared to 2Q 2012

Net income was $3.7 million in the second quarter of 2013 compared to $338
thousand in the second quarter of 2012. After preferred stock dividends and
accretion, net income available to common stockholders was $3.0 million, or
$0.07 per common share, in the second quarter of 2013 compared to a net loss
of $29 thousand, or $0.00 per common share, in the second quarter of 2012.
Operating earnings, which excludes securities gains, the ECB acquisition gain,
and merger and conversion costs, improved to $2.8 million in second quarter
2013 from $360 thousand in the second quarter of 2012 as the Company improved
its financial performance following the ECB merger by increasing net interest
income, lowering provision for loan losses, increasing non-interest income,
and by reducing its operating efficiency ratio. Similarly, pre-tax,
pre-provision operating earnings increased to $6.0 million in the second
quarter of 2013 from $2.2 million in the second quarter of 2012.

Year-to-Date

Net income was $2.9 million in the first six months of 2013 while net income
was $395 thousand in the 2012 Successor Period and $529 thousand in the 2012
Predecessor Period. After dividends and accretion on preferred stock, net
income available to common stockholders was $1.8 million, or $0.04 per common
share, in the first six months of 2013, while net loss attributable to common
stockholders was $216 thousand, or $0.01 per common share, in the 2012
Successor Period, and net income available to common stockholders was $407
thousand, or $0.01 per common share, in the 2012 Predecessor Period.

Net Interest Income

2Q 2013 compared to 2Q 2012

Net interest income was $20.4 million in the second quarter of 2013 compared
to $10.0 million in the second quarter of 2012. The increase in net interest
income was the result of a significant increase in earning assets from organic
business activity and the ECB merger as well as an improved net interest
margin. Average earning assets increased from $937.7 million in the 2Q second
quarter of 2012 to $1.75 billion in the second quarter of 2013. Over this
period, average loan balances increased by $611.5 million, of which $466.7
million was from acquired ECB loans, and average investment securities
balances increased by $222.2 million. In addition, average deposits increased
by $768.6 million, of which $736.1 million was from the ECB merger.

The Company's net interest margin expanded from 4.33 percent in the second
quarter of 2012 to 4.67 percent in the second quarter of 2013. The improved
net interest margin was due to lower costs on interest-bearing liabilities and
slightly higher yields on earning assets. The yield on earning assets
increased from 5.09 percent in the second quarter of 2012 to 5.12 percent in
the second quarter of 2013, which reflected increased loan yields partially
offset by lower yields on investment securities. The increase in loan yields
was a product of higher acquired ECB loan yields, which included a favorable
impact from acquisition accounting fair value adjustments, partially offset by
lower prevailing market loan rates on new loan originations. Securities yields
declined as the Company reinvested principal paydowns and proceeds from sales
at lower current market rates and as yields on the acquired ECB securities
portfolio were lowered to current market rates.

The cost of interest-bearing liabilities declined from 0.91 percent in the
second quarter of 2012 to 0.51 percent in the second quarter of 2013, which
primarily reflected a lower cost of deposits as the Company adjusted interest
rates it pays on certain checking and money market accounts in the second
quarter of 2013 and incorporated the ECB deposit base. Further, in order to
fund loan growth and to hedge the risk of rising interest rates on the
Company's financial condition, the Company increased its level of borrowings
in the current quarter in the form of FHLB advances which also lowered overall
funding costs.

In the second quarter of 2013, the Company entered into a series of forward
starting interest rate swaps on $75.0 million of short-term FHLB advances.
Beginning in the second quarter of 2015, these interest rate swaps will
exchange the short-term variable interest rate the Company is to pay on the
advances with fixed interest rates ranging from 1.65 to 1.72 percent. These
interest rate swaps are considered effective cash flow hedges; therefore,
changes in the fair value of the hedges, net of tax, are recorded to other
comprehensive income. The purpose of these cash flow hedges is to mitigate the
risk that potentially rising interest rates pose to the Company's tangible
book value since the fair value of investment securities generally declines in
a rising interest rate environment and the fair value of these cash flow
hedges generally increases in a rising interest rate environment. In the
second quarter of 2013, the fair value of the investment securities portfolio
declined net of tax by $6.5 million, or $0.14 per outstanding common share,
primarily due to increases in market interest rates, while the fair value of
cash flow hedges increased net of tax by $2.4 million, or $0.05 per
outstanding common share, thus partially reducing the negative impact of lower
securities values to tangible book value. The Company's management and board
of directors actively manage interest rate risk, and based on its interest
rate risk modeling, the Company believes its balance sheet is appropriately
positioned for changing interest rate scenarios in the short term and long
term.

Income accretion on purchased loans totaled $6.2 million in the second quarter
of 2013, which consisted of $3.9 million of accretion on purchased
credit-impaired ("PCI") loans and $2.3 million of accretion income on
purchased non-impaired loans. PCI loan accretion represents all interest
income recorded for those loans in the period while accretion income on
purchased non-impaired loans represents accretion of the fair value discount
on the effective yield method, which increased interest income above
contractual yields. Time deposit fair value amortization totaled $966
thousand, and net amortization of short-term borrowings and long-term debt
totaled $18 thousand, which reduced interest expense. Acquisition accounting
amortization reduced the Company's cost of interest-bearing liabilities by
0.26 percent in the second quarter of 2013.

Year-to-Date

Net interest income in the first six months of 2013 totaled $30.4 million
while net interest income totaled $16.9 million in the 2012 Successor Period
and $3.6 million in the 2012 Predecessor Period. Average earning assets
totaled $1.35 billion in the first six months of 2013, which was a significant
increase from $945.6 million in the 2012 Successor Period and $934.3 million
in the 2012 Predecessor Period. The increase in average interest-earning
assets was primarily the result of assets acquired in the ECB merger as well
as organic loan growth.

Net interest margin was 4.53 percent in the first six months of 2013, which
was an increase from 4.36 percent in the 2012 Successor Period but a slight
decrease from 4.55 percent in the 2012 Predecessor Period. The increase in net
interest margin from the 2012 Successor Period was primarily due to a
reduction in the cost of interest-bearing liabilities which fell from 0.91
percent in the 2012 Successor Period to 0.60 percent in the first six months
of 2013. Declining yields on interest-earning assets partially offset the
improvement in the cost of interest-bearing liabilities due to the origination
of new loans at lower current market rates and the reinvestment of principal
paydowns and proceeds from sales of securities at lower current market rates.
The average yield on loans decreased from 6.08 percent in the 2012 Successor
Period and 6.15 percent in the 2012 Predecessor Period to 5.97 percent in the
first six months of 2013, and the average yield on investment securities
declined from 2.70 percent in the 2012 Successor Period and 2.74 percent in
the 2012 Predecessor Period to 2.15 percent in the first six months of 2013.

Income accretion on purchased loans totaled $9.7 million in the first six
months of 2013, which consisted of $7.3 million of accretion on purchased
credit-impaired ("PCI") loans and $2.4 million of accretion income on
purchased non-impaired loans. Time deposit fair value amortization totaled
$1.4 million, which reduced interest expense, while net accretion of
short-term borrowings and long-term debt totaled $19 thousand, which increased
interest expense. Time deposit amortization, net of accretion on short-term
borrowings and long-term debt reduced the Company's cost of interest-bearing
liabilities by 0.24 percent in the first six months of 2013. Income accretion
on purchased loans totaled $6.9 million and $1.6 million in the 2012 Successor
Period and 2012 Predecessor Period, respectively. Net amortization of fair
value premiums on interest-bearing liabilities in the 2012 Successor Period
and 2012 Predecessor Period totaled $1.4 million and $298 thousand,
respectively, which reduced the Company's cost of interest-bearing liabilities
by 0.42 percent and 0.45 percent, respectively.

Provision for Loan Losses and Asset Quality

2Q 2013 compared to 2Q 2012

Provision for loan losses was $1.5 million in the second quarter of 2013
compared to $2.0 million in the second quarter of 2012. The allowance for loan
and lease losses ("ALLL") and related provision were calculated for the
Company's following three portfolio categories: non-acquired loans, purchased
non-impaired loans, and PCI loans. In the second quarter of 2013, the
non-acquired loan provision was $1.5 million, purchased non-impaired loan
provision was $356 thousand, and the Company recognized a PCI loan provision
recovery of $397 thousand, which reduced the ALLL.

The following table summarizes the changes in the ALLL for each loan category
in 2Q 2013 and 2Q 2012.

(Dollars in thousands)    Non-Acquired Purchased    Purchased       Total
                                       Non-Impaired Credit-Impaired
                                                                
2Q 2013:                                                         
Balance at April 1, 2013  $2,834       $210         $2,483          $5,527
Net charge-offs           (28)         (566)        —               (594)
Provision for loan losses 1,533        356          (397)           1,492
Balance at June 30, 2013  $4,339       $—           $2,086          $6,425
                                                                
2Q 2012:                                                         
Balance at April 1, 2012  $1,236       $371         $—              $1,607
Net charge-offs           —            (610)        —               (610)
Provision for loan losses 401          873          772             2,046
Balance at June 30, 2012  $1,637       $634         $772            $3,043

The reduction in provision for loan losses in the second quarter of 2013
compared to the prior year second quarter was primarily due to improvements in
expected cash flows on the Company's PCI loans, which generated a net
provision recovery of $397 thousand in the second quarter of 2013, and lower
provision on purchased non-impaired loans. The lower provision on purchased
loans was partially offset by higher provision on the non-acquired loan
portfolio as the balance of this portfolio increased by $137.7 million in the
second quarter of 2013, which was a significantly higher growth rate than in
the prior year.

The ALLL was $6.4 million, or 0.49 percent of total loans as of June 30, 2013
compared to $5.5 million, or 0.70 percent of total loans as of March 31, 2013
and $4.0 million, or 0.52 percent of total loans as of December 31, 2012.
Adjusted ALLL, which includes the ALLL and net acquisition accounting fair
value adjustments for acquired loans, represented 3.70 percent of total loans
as of June30, 2013 compared to 2.54 percent as of March 31, 2013 and 2.70
percent as of December 31, 2012.

Nonperforming loans as a percentage of total loans was 1.14 percent as of
June30, 2013, which was a decline from 1.48 percent as of March 31, 2013 and
1.67 percent as of December 31, 2012. Total nonperforming assets (which
include nonaccrual loans, loans past due 90 days or more and still accruing,
and foreclosed assets) as a percentage of total assets as of June30, 2013 was
1.33 percent, which was a decline from 1.48 percent as of March 31, 2013 and
1.71 percent as of December 31, 2012. The decline in nonperforming assets was
due to the ECB merger as well as the Company's continuing efforts to resolve
legacy problem assets while maximizing value. These resolution efforts have
included a combination of asset sales through various channels and successful
loan workout plans.

Year-to-Date

Provision for loan losses was $3.4 million in the first six months of 2013
while provision for loan losses totaled $2.9 million in the 2012 Successor
Period and $195 thousand in the 2012 Predecessor Period.

The following table summarizes the changes in ALLL for each loan category in
the six months ended June30, 2013.

(Dollars in thousands)     Non-Acquired Purchased    Purchased       Total
                                        Non-Impaired Credit-Impaired
                                                                 
Balance at January 1, 2013 $2,665       $55          $1,278          $3,998
Net charge-offs            (118)        (887)        —               (1,005)
Provision for loan losses  1,792        832          808             3,432
Balance at June 30, 2013   $4,339       $—           $2,086          $6,425

Non-Interest Income

2Q 2013 compared to 2Q 2012

Non-interest income totaled $13.1 million in the second quarter of 2013, which
was a significant increase from $2.4 million in the second quarter of 2012.
Non-interest income in the current quarter included a one-time acquisition
gain of $8.2 million related to the ECB merger, which reflected the amount by
which the fair value of acquired net assets exceeded the combined purchase
price and fair value of non-controlling interests.

Service charges and fees on deposit accounts increased by $968 thousand
primarily due to the addition of deposit accounts acquired in the ECB merger.
Mortgage banking income increased by $326 thousand with the addition of
mortgage lenders in eastern North Carolina and improving residential real
estate markets which provided more lending opportunities for home purchases.
Government-guaranteed lending income, which includes gains on sales of the
guaranteed portion of certain SBA loans originated by the Company as well as
servicing fees on previously sold SBA loans, increased by $486 thousand. The
Company sells the guaranteed portion of certain SBA loans in the secondary
market without recourse and recognizes gains as those loans are sold at a
premium.

Year-to-Date

Non-interest income totaled $16.6 million in the first six months of 2013
while non-interest income totaled $3.9 million in the 2012 Successor Period
and $657 thousand in the 2012 Predecessor Period. Non-interest income in the
current year-to-date period included a one-time acquisition gain of $8.2
million related to the ECB merger. Securities gains totaled $1.2 million in
the first six months of 2013 as the Company recognized gains upon selling the
majority of its municipal bonds for balance sheet management and tax purposes.
Additionally, service charges and fees on deposits, mortgage banking income,
government-guaranteed lending income, and bank-owned life insurance income
totaled $2.0 million, $1.5 million, $2.2 million, and $505 thousand,
respectively, in the first six months of 2013.

Non-Interest Expense

2Q 2013 compared to 2Q 2012

Non-interest expense totaled $31.1 million in the second quarter of 2013 which
was a significant increase from $10.3 million in the second quarter of 2012.
The increase in expenses was primarily due to $12.0 million in merger and
conversion-related costs in the second quarter of 2013, which included
professional fees, severance, and other expenses required to close the ECB
merger as well as costs to convert ECB's data processing, technology, signage,
and branch network to the Company's integrated platform. Additionally,
salaries and employee benefits, occupancy and equipment, data processing, and
other non-interest expense categories increased primarily due to the ECB
merger which added employees, branch and other facilities, and equipment to
the Company's expense base. The Company's operating efficiency ratio, which
excludes non-recurring merger and conversion costs, improved from 82.8 percent
in the second quarter of 2012 to 75.9 percent in the second quarter of 2013.
Much of the improvement in the operating efficiency ratio was due to increased
scale and operating leverage provided by the ECB merger combined with cost
cutting measures implemented during the second quarter of 2013 which will
begin to fully benefit the Company in the third quarter of 2013. For example,
full time equivalent employees for the combined Company decreased from 520 as
of March 31, 2013 to 485 as of June 30, 2013.

Year-to-Date

Non-interest expense totaled $43.8 million in the first six months of 2013
while non-interest expense totaled $17.7 million in the 2012 Successor Period
and $3.2 million in the 2012 Predecessor Period. Expenses in the first six
months of 2013 were significantly impacted by ECB merger and system conversion
costs, which totaled $13.6 million, as well as a higher general expense run
rate following the ECB merger. The Company's operating efficiency ratio was
78.2 percent in the first six months of 2013 compared to 82.9 percent in the
2012 Successor Period and 74.7 percent in the 2012 Predecessor Period.

Income Taxes

The Company's income tax benefit was $2.8 million in the second quarter of
2013 compared to $259 thousand in the second quarter of 2012. Taxable income
is calculated using pre-tax net income adjusted for the one-time acquisition
gain in the second quarter of 2013, non-taxable municipal investment income,
bank-owned life insurance income, and non-deductible merger costs. The
Company's income tax benefit was $3.2 million in the first six months of 2013.
The income tax benefit was $255 thousand in the 2012 Successor Period, and
income tax expense was $270 thousand in the 2012 Predecessor Period.

Linked Quarter Comparison

Net income was $3.7 million in the second quarter of 2013 compared to a net
loss of $806 thousand in the first quarter of 2013. After preferred stock
dividends and accretion, net income available to common stockholders was $3.0
million, or $0.07 per common share, in the second quarter of 2013 compared to
a net loss attributable to common stockholders of $1.2 million, or $0.03 per
common share, in the first quarter of 2013. Operating earnings, which excludes
securities gains, the ECB acquisition gain, and merger and conversion costs,
improved to $2.8 million in the second quarter of 2013 from a loss of $422
thousand in the first quarter of 2013 as the Company improved its financial
performance following the ECB merger by increasing net interest income,
lowering provision for loan losses, increasing non-interest income, and by
reducing its operating efficiency ratio. Similarly, pre-tax, pre-provision
earnings increased to $6.0 million in the second quarter of 2013 from $1.2
million in the first quarter of 2013.

Net interest income was $20.4 million in the second quarter of 2013 compared
to $9.9 million in the first quarter of 2013. The increase in net interest
income was the result of a significant increase in earning assets from organic
business activity and the ECB merger as well as an improved net interest
margin. Average earning assets increased from $956.1 million in the first
quarter of 2013 to $1.75 billion in the second quarter of 2013. Over this
period, average loan balances increased by $533.2 million, of which $466.7
million was from acquired ECB loans, and average investment securities
balances increased by $250.9 million. In addition, average deposits increased
by $751.0 million, of which $736.1 million was from the ECB merger.

The Company's net interest margin expanded from 4.24 percent in the first
quarter of 2013 to 4.67 percent in the second quarter of 2013. The improved
net interest margin was due to lower costs on interest-bearing liabilities and
higher yields on earning assets. The cost of interest-bearing liabilities
declined from 0.76 percent in the first quarter of 2013 to 0.51 percent in the
second quarter of 2013, which primarily reflected a lower cost of deposits as
the Company adjusted interest rates it pays on certain checking and money
market accounts in the second quarter of 2013 and incorporated the ECB deposit
base. Further, in order to fund loan growth and to hedge the risk of rising
interest rates on the Company's tangible book value, the Company increased its
level of borrowings in the current quarter in the form of FHLB advances, which
also lowered overall funding costs in the quarter. Core net interest margin,
which excludes the impact of acquisition accounting, was 3.64 percent in the
second quarter of 2013 compared to 3.63 percent in the first quarter of 2013.

Provision for loan losses was $1.5 million in the second quarter of 2013
compared to $1.9 million in the first quarter of 2013. The reduction in
provision for loan losses in the second quarter of 2013 was primarily due to
improvements in expected cash flows on the Company's PCI loans, which
generated a net provision recovery of $397 thousand in the second quarter of
2013, and lower provision on purchased non-impaired loans. The lower provision
on purchased loans was partially offset by higher provision on the
non-acquired loan portfolio as the balance of this portfolio increased by
$137.7 million in the second quarter of 2013, which was a significantly higher
growth rate than in the prior quarter.

Non-interest income totaled $13.1 million in the second quarter of 2013, which
was a significant increase from $3.5 million in the first quarter of 2013.
Non-interest income in the current quarter included a one-time acquisition
gain of $8.2 million related to the ECB merger, which reflected the amount by
which the fair value of acquired net assets exceeded the combined purchase
price and fair value of non-controlling interests. Service charges and fees on
deposit accounts increased by $1.0 million primarily due to the addition of
deposit accounts acquired in the ECB merger. Mortgage banking income increased
by $705 thousand with the addition of mortgage lenders in eastern North
Carolina and improving residential real estate markets which provided more
lending opportunities for home purchases.

Non-interest expense totaled $31.1 million in the second quarter of 2013,
which was a significant increase from $12.7 million in the first quarter of
2013. Higher expenses on a linked quarter basis were partially due to a $10.4
million increase in merger and conversion-related costs. Additionally,
salaries and employee benefits, occupancy and equipment, data processing, and
other non-interest expense categories increased primarily due to the ECB
merger which added employees, branch and other facilities, and equipment to
the Company's expense base. The Company's operating efficiency ratio, which
excludes merger and conversion costs, improved from 82.5 percent in the first
quarter of 2013 to 75.9 percent in the second quarter of 2013.

VantageSouth Bank is a state-chartered bank operating forty-six banking
offices in central and eastern North Carolina. The common stock of
VantageSouth Bancshares, Inc. is listed on the NYSE MKT, LLC under the symbol
VSB. Investors can access additional corporate information, product
descriptions and online services through VantageSouth Bank's website at
www.VantageSouth.com.

Conference Call

VSB will conduct a conference call at 10:00 a.m. EDT today to discuss today's
press release. The conference call will be broadcast live over the Internet
and can be accessed by any interested party at http://www.VantageSouth.com
(under the Investor Relations section). A telephone playback of the conference
call will be available approximately one hour after the completion of the call
by dialing (800) 633-8284 and entering passcode 21668871.

Non-GAAP Financial Measures

Statements included in this press release include non-GAAP financial measures
and should be read along with the accompanying tables which provide a
reconciliation of non-GAAP financial measures to GAAP financial measures.The
Company's management uses these non-GAAP financial measures, including: (i)
net operating earnings (loss); (ii) pre-tax, pre-provision operating earnings;
(iii) operating non-interest income, (iv) operating efficiency ratio, (v)
adjusted allowance for loan losses to loans; and (vi) tangible common equity,
in their analysis of the Company's performance. Net operating earnings (loss)
excludes the following from net income (loss): securities gains, a one-time
acquisition gain, merger and conversion costs, and the income tax effect of
adjustments. Pre-tax, pre-provision operating earnings excludes the following
from net income (loss): provision for loan losses, income tax expense
(benefit), securities gains, a one-time acquisition gain, and merger and
conversion costs. The operating efficiency ratio excludes a one-time
acquisition gain and merger and conversion costs from the efficiency ratio.
Adjusted allowance for loan losses adds net acquisition accounting fair value
discounts to the allowance for loan losses. Tangible common equity excludes
preferred stock as well as goodwill and other intangible assets, net, from
total stockholders' equity.

Management believes that non-GAAP financial measures provide additional useful
information that allows readers to evaluate the ongoing performance of the
Company.Non-GAAP financial measures should not be considered as an
alternative to any measure of performance or financial condition as
promulgated under GAAP, and investors should consider the Company's
performance and financial condition as reported under GAAP and all other
relevant information when assessing the performance or financial condition of
the Company.Non-GAAP financial measures have limitations as analytical tools,
and investors should not consider them in isolation or as a substitute for
analysis of the Company's results or financial condition as reported under
GAAP.

Forward-looking Statements

Information in this press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. These
statements involve risks and uncertainties that could cause actual results to
differ materially, including without limitation, risks associated with the
ownership by Piedmont of a majority of the Company's voting power, including
the possibility of the interests of Piedmont differing from other Company
stockholders or any change in management, strategic direction, business plan,
or operations, the ability of our management to successfully integrate the
Company's business and execute its business plan across several geographic
areas, local economic conditions affecting retail and commercial real estate,
disruptions in the credit markets, changes in interest rates, adverse
developments in the real estate market affecting the value and marketability
of collateral securing loans made by the Bank, the failure of assumptions
underlying loan loss and other reserves, competition, our ability to
successfully integrate any businesses that we acquire, and the risk of new and
changing regulation. Additional factors that could cause actual results to
differ materially are discussed in the Company's filings with the Securities
and Exchange Commission, including without limitation its Annual Report on
Form 10-K, its Quarterly Reports on Form 10-Q, and its Current Reports on Form
8-K. The forward-looking statements in this press release speak only as of the
date of the press release, and the Company does not assume any obligation to
update such forward-looking statements.

QUARTERLY RESULTS OF OPERATIONS

                       Three Months Ended
(Dollars in thousands,  June 30,   March 31,  December   September  June 30,
except per share data)  2013       2013       31,        30,        2012
                                              2012       2012
                                                               
Interest income                                                 
Loans                   $20,376  $10,697  $10,898  $10,810  $10,707
Investment securities   2,005      815        855        1,036      1,070
Federal funds sold and
interest-earning        21         16         20         16         33
deposits
Total interest income   22,402     11,528     11,773     11,862     11,810
Interest expense                                                
Deposits                1,619      1,302      1,309      1,320      1,462
Short-term borrowings   42         12         10         3          4
Long-term debt          313        270        279        274        311
Total interest expense  1,974      1,584      1,598      1,597      1,777
Net interest income     20,428     9,944      10,175     10,265     10,033
Provision for loan      1,492      1,940      1,167      1,077      2,046
losses
Net interest income
after provision for     18,936     8,004      9,008      9,188      7,987
loan losses
Non-interest income                                             
Service charges and
fees on deposit         1,525      515        508        523        557
accounts
Mortgage banking        1,096      391        771        1,127      770
Government-guaranteed   1,058      1,119      1,718      776        572
lending
Bank-owned life         310        195        208        215        203
insurance
Gain (loss) on sales of
available for sale      123        1,092      603        483        (27)
securities
Gain on acquisition     8,241      —          —          —          —
Other                   743        150        325        208        315
Total non-interest      13,096     3,462      4,133      3,332      2,390
income
Non-interest expense                                            
Salaries and employee   11,009     5,991      6,588      5,648      5,513
benefits
Occupancy and equipment 2,408      1,547      1,321      1,385      1,353
Data processing         1,075      644        698        644        594
FDIC insurance premiums 400        227        216        205        229
Professional services   914        497        684        800        584
Foreclosed asset        79         183        662        251        295
expenses
Other loan-related      792        461        352        419        335
expense
Merger and conversion   11,961     1,601      2,114      547        6
costs
Other                   2,502      1,516      1,719      1,241      1,389
Total non-interest      31,140     12,667     14,354     11,140     10,298
expense
Income (loss) before    892        (1,201)    (1,213)    1,380      79
income taxes
Income tax expense      (2,808)    (395)      (3,326)    95         (259)
(benefit)
Net income (loss)       3,700      (806)      2,113      1,285      338
Dividends and accretion 705        369        368        367        367
on preferred stock
Net income available
(loss attributable) to  $2,995   $(1,175)  $1,745   $918     $(29)
common stockholders
                                                               
NET INCOME (LOSS) PER                                           
COMMON SHARE
Basic                   $0.07    $(0.03)  $0.05    $0.03    $—
Diluted                 $0.07    $(0.03)  $0.05    $0.03    $—
                                                               
WEIGHTED AVERAGE COMMON                                         
SHARES
Weighted average common
shares outstanding -    45,916,707 35,758,033 35,728,359 35,725,915 35,723,442
basic
Weighted average common
shares outstanding -    45,935,330 35,758,033 35,806,191 35,749,168 35,723,442
diluted

                               
                               
                               Three Months Ended
(Dollars in thousands, except   June 30, March 31, December September June 30,
per share data)                 2013     2013      31,      30,       2012
                                                   2012     2012
                                                                 
PERFORMANCE RATIOS                                                
                                                                 
Return on average assets        0.75%    (0.30)%   0.79%    0.49%     0.13%
Return on average equity        6.27%    (1.88)%   4.84%    2.98%     0.80%
Yield on earning assets, tax    5.12%    4.91%     5.05%    5.18%     5.09%
equivalent
Cost of interest-bearing        0.51%    0.76%     0.80%    0.83%     0.91%
liabilities
Net interest margin, tax        4.67%    4.24%     4.37%    4.49%     4.33%
equivalent
Efficiency ratio                92.89%   94.49%    100.32%  81.93%    82.89%
Net loan charge-offs            0.18%    0.21%     0.17%    0.44%     0.35%
                                                                 
Reconciliation of GAAP to                                         
Non-GAAP
                                                                 
OPERATING EARNINGS                                                
                                                                 
Net income (loss) (GAAP)        $ 3,700  $ (806)   $ 2,113  $ 1,285   $ 338
Securities (gains) losses       (123)    (1,092)   (603)    (483)     27
Gain on acquisition             (8,241)  —         —        —         —
Merger and conversion costs     11,961   1,601     2,114    547       6
Income tax effect of            (4,484)  (125)     (89)     33        (11)
adjustments
Deferred tax asset valuation    —        —         (3,300)  —         —
allowance reversal
Net operating earnings (loss)   $ 2,813  $ (422)   $ 235    $ 1,382   $ 360
(Non-GAAP)
                                                                 
PRE-TAX, PRE-PROVISION                                            
OPERATING EARNINGS
                                                                 
Net income (loss) (GAAP)        $ 3,700  $ (806)   $ 2,113  $ 1,285   $ 338
Provision for loan losses       1,492    1,940     1,167    1,077     2,046
Income tax expense (benefit)    (2,808)  (395)     (3,326)  95        (259)
Pre-tax, pre-provision income   2,384    739       (46)     2,457     2,125
(loss)
Securities (gains) losses       (123)    (1,092)   (603)    (483)     27
Gain on acquisition             (8,241)  —         —        —         —
Merger and conversion costs     11,961   1,601     2,114    547       6
Pre-tax, pre-provision          $ 5,981  $ 1,248   $ 1,465  $ 2,521   $ 2,158
operating earnings (Non-GAAP)
                                                                 
OPERATING NON-INTEREST INCOME                                     
                                                                 
Non-interest income (GAAP)      $ 13,096 $ 3,462   $ 4,133  $ 3,332   $ 2,390
Gain on acquisition             (8,241)  —         —        —         —
Operating non-interest income   $ 4,855  $ 3,462   $ 4,133  $ 3,332   $ 2,390
(non-GAAP)
                                                                 
OPERATING EFFICIENCY RATIO                                        
                                                                 
Efficiency ratio (GAAP)         92.89%   94.49%    100.32%  81.93%    82.89%
Effect to adjust for gain on    30.28%   —%        —%       —%        —%
acquisition
Effect to adjust for merger and (47.31)% (11.94)%  (14.77)% (4.02)%   (0.04)%
conversion costs
Operating efficiency ratio      75.86%   82.55%    85.55%   77.91%    82.85%
(Non-GAAP)

YEAR-TO-DATE RESULTS OF OPERATIONS

                                   Successor                    Predecessor
                                    Company                      Company
                                    Six Months     Period from   Period from
(Dollars in thousands, except per   Ended          February 1 to January 1 to
share data)                         June 30, 2013 June 30, 2012 January 31,
                                                                 2012
                                                              
Interest income                                                
Loans                               $31,073      $18,009     $3,807
Investment securities               2,820          1,826         395
Federal funds sold and              37             49            4
interest-earning deposits
Total interest income               33,930         19,884        4,206
Interest expense                                               
Deposits                            2,921          2,457         530
Short-term borrowings               54             6             —
Long-term debt                      583            512           103
Total interest expense              3,558          2,975         633
Net interest income                 30,372         16,909        3,573
Provision for loan losses           3,432          2,915         195
Net interest income after provision 26,940         13,994        3,378
for loan losses
Non-interest income                                            
Service charges and fees on deposit 2,040          906           194
accounts
Mortgage banking                    1,487          1,266         225
Government-guaranteed lending       2,177          566           98
Bank-owned life insurance           505            337           70
Gain on sales of available for sale 1,215          165           —
securities
Gain on acquisition                 8,241          —             —
Other                               893            622           70
Total non-interest income           16,558         3,862         657
Non-interest expense                                           
Salaries and employee benefits      17,000         9,013         1,737
Occupancy and equipment             3,955          2,162         396
Data processing                     1,719          1,039         212
FDIC insurance premiums             627            506           141
Professional services               1,411          1,125         144
Foreclosed asset expenses           262            390           11
Other loan-related expense          1,253          752           162
Merger and conversion costs         13,562         503           78
Other                               4,018          2,226         355
Total non-interest expense          43,807         17,716        3,236
Income (loss) before income taxes   (309)          140           799
Income tax expense (benefit)        (3,203)        (255)         270
Net income                          2,894          395           529
Dividends and accretion on          1,074          611           122
preferred stock
Net income available (loss
attributable) to common             $1,820       $(216)       $407
stockholders
                                                              
NET INCOME (LOSS) PER COMMON SHARE                             
Basic                               $0.04        $(0.01)     $0.01
Diluted                             $0.04        $(0.01)     $0.01

                                                           
                                                           
                               Successor                    Predecessor
                                Company                      Company
(Dollars in thousands, except   Six Months     Period from   Period from
per share data)                 Ended          February 1 to January 1 to
                                June 30, 2013 June 30, 2012 January 31, 2012
                                                          
PERFORMANCE RATIOS                                         
                                                          
Return on average assets        0.38%          0.09%         0.58%
Return on average equity        2.84%          0.56%         3.67%
Yield on earning assets, tax    5.06%          5.13%         5.35%
equivalent
Cost of interest-bearing        0.60%          0.91%         0.95%
liabilities
Net interest margin, tax        4.53%          4.36%         4.55%
equivalent
Efficiency ratio                93.35%         85.29%        76.50%
Net loan charge-offs            0.19%          0.39%         —%
                                                          
Reconciliation of GAAP to                                  
Non-GAAP
                                                          
OPERATING EARNINGS                                         
                                                          
Net income (GAAP)               $ 2,894        $ 395         $ 529
Securities gains                (1,215)        (165)         —
Gain on acquisition             (8,241)        —             —
Merger and conversion costs     13,562         503           78
Income tax effect               (4,609)        (129)         (30)
Net operating earnings          $ 2,391        $ 604         $ 577
(Non-GAAP)
                                                          
PRE-TAX, PRE-PROVISION                                     
OPERATING EARNINGS
                                                          
Net income (GAAP)               $ 2,894        $ 395         $ 529
Provision for loan losses       3,432          2,915         195
Income tax expense (benefit)    (3,203)        (255)         270
Pre-tax, pre-provision income   3,123          3,055         994
Securities (gains) losses       (1,215)        (165)         —
Gain on acquisition             (8,241)        —             —
Merger and conversion costs     13,562         503           78
Pre-tax, pre-provision          $ 7,229        $ 3,393       $ 1,072
operating earnings (Non-GAAP)
                                                          
OPERATING NON-INTEREST INCOME                              
                                                          
Non-interest income (GAAP)      $ 16,558       $ 3,862       $ 657
Gain on acquisition             (8,241)        —             —
Operating non-interest income   $ 8,317        $ 3,862       $ 657
(non-GAAP)
                                                          
OPERATING EFFICIENCY RATIO                                 
                                                          
Efficiency ratio (GAAP)         93.35%         85.29%        76.50%
Effect to adjust for gain on    19.88%         —             —
acquisition
Effect to adjust for merger and (35.05)%       (2.42)%       (1.84)%
conversion costs
Operating efficiency ratio      78.17%         82.87%        74.66%
(Non-GAAP)

QUARTERLY BALANCE SHEETS

                Ending Balances
(Dollars in      June 30,     March 31,    December 31, September    June 30,
thousands)                                              30,
                2013         2013         2012         2012         2012
Assets                                                           
Cash and due     $29,264    $11,020    $15,735    $13,187    $18,776
from banks
Interest-earning
deposits with    57,689       4,092        7,978        3,821        6,817
banks
Federal funds    855          29,125       26,750       20,550       44,535
sold
Investment
securities       376,536      154,634      136,311      153,742      173,757
available for
sale
Investment
securities held  200          194          180          166          130
to maturity
Loans held for   21,390       8,671        16,439       8,239        7,357
sale
Loans            1,323,981    794,623      763,416      739,028      696,872
Allowance for    (6,425)      (5,527)      (3,998)      (3,146)      (3,043)
loan losses
Net loans        1,317,556    789,096      759,418      735,882      693,829
Federal Home     6,904        2,382        2,307        2,172        3,894
Loan Bank stock
Premises and     42,917       17,885       17,351       17,068       17,130
equipment, net
Bank-owned life  32,642       20,138       19,976       19,800       19,620
insurance
Foreclosed       11,632       4,752        5,837        6,697        7,772
assets
Deferred tax     58,560       37,525       36,659       33,162       33,590
asset, net
Goodwill         26,254       26,254       26,254       26,254       26,254
Other intangible 6,343        2,266        2,376        2,487        2,597
assets, net
Accrued interest
receivable and   20,678       8,008        11,654       10,842       11,771
other assets
Total assets     $2,009,420 $1,116,042 $1,085,225 $1,054,069 $1,067,829
                                                                
Liabilities                                                      
Deposits:                                                        
Non-interest     $197,229   $73,756    $71,613    $111,725   $102,596
demand
Interest-bearing 344,515      188,463      188,843      139,768      146,027
demand
Money market and 482,672      270,994      260,966      241,324      245,913
savings
Time             630,283      370,710      351,800      360,172      372,074
Total deposits   1,654,699    903,923      873,222      852,989      866,610
Short-term       68,002       6,000        7,500        —            —
borrowings
Long-term debt   45,341       28,902       19,864       24,326       24,288
Accrued interest
payable and      11,505       4,818        10,698       5,243        7,050
other
liabilities
Total            1,779,547    943,643      911,284      882,558      897,948
liabilities
                                                                
Stockholders'                                                    
equity
Preferred stock, 42,437       24,715       24,657       24,601       24,544
no par value
Common stock,    46           36           36           36           36
$0.001 par value
Common stock     1,457        1,325        1,325        1,325        1,325
warrant
Additional       188,408      147,738      147,510      146,655      146,648
paid-in capital
Retained
earnings         416          (2,578)      (1,405)      (3,200)      (4,115)
(accumulated
deficit)
Accumulated
other            (2,891)      1,163        1,818        2,094        1,443
comprehensive
income (loss)
Total
stockholders'    229,873      172,399      173,941      171,511      169,881
equity
Total
liabilities and  $2,009,420 $1,116,042 $1,085,225 $1,054,069 $1,067,829
stockholders'
equity
                                                                
Supplemental information on
components of accumulated                                         
other comprehensive income
(loss):
Investment
securities       $(5,115)    $1,374     $2,085     $2,367     $1,443
available for
sale, net of tax
Cash flow
hedges, net of   2,224        (211)        (267)        (273)        —
tax
Total
accumulated
other            $(2,891)    $1,163     $1,818     $2,094     $1,443
comprehensive
income (loss)
                                                                
                                                                
                Ending Balances
                June 30,     March 31,    December 31, September    June 30,
                                                        30,
                2013         2013         2012         2012         2012
COMMON SHARE                                                     
DATA
                                                                
Book value per   $4.07      $4.13      $4.18      $4.11      $4.07
common share
Tangible book
value per common $3.36      $3.33      $3.37      $3.31      $3.26
share
Ending shares    46,038,808   35,779,127   35,754,247   35,747,576   35,749,689
outstanding
                                                                
CAPITAL RATIOS                                                   
                                                                
Tangible equity
to tangible      9.98%        13.23%       13.75%       13.92%       13.57%
assets
Tangible common
equity to        7.83%        10.96%       11.42%       11.52%       11.21%
tangible assets
VantageSouth                                                     
Bank:
Tier 1 leverage  8.26%        11.08%       11.45%       9.89%        9.41%
ratio
Tier 1
risk-based       10.22%       13.13%       13.66%       12.82%       12.02%
capital ratio
Total risk-based 11.11%       14.58%       14.96%       13.28%       12.49%
capital ratio
Crescent State                                                   
Bank:
Tier 1 leverage  N/A          N/A          N/A          12.21%       12.11%
ratio
Tier 1
risk-based       N/A          N/A          N/A          13.81%       14.22%
capital ratio
Total risk-based N/A          N/A          N/A          15.20%       15.61%
capital ratio
                                                                
ASSET QUALITY                                                    
DATA
                                                                
Nonperforming    $15,116    $11,792    $12,770    $14,023    $17,983
loans
Foreclosed       11,632       4,752        5,837        6,697        7,772
assets
Total
nonperforming    $26,748    $16,544    $18,607    $20,720    $25,755
assets
                                                                
Allowance for
loan losses to   0.49%        0.70%        0.52%        0.43%        0.44%
loans
Nonperforming
loans to total   1.14%        1.48%        1.67%        1.90%        2.58%
loans
Nonperforming
assets to total  1.33%        1.48%        1.71%        1.97%        2.41%
assets
Restructured
loans not        $550       $558       $104       $—         $—
included in
categories above
                                                                
Reconciliation
of GAAP to                                                       
Non-GAAP
                                                                
ADJUSTED
ALLOWANCE FOR                                                    
LOAN LOSSES
                                                                
Allowance for
loan losses      $6,425     $5,527     $3,998     $3,146     $3,043
(GAAP)
Net acquisition
accounting fair  42,534       14,688       16,633       17,962       18,582
value discounts
to loans
Adjusted
allowance for    48,959       20,215       20,631       21,108       21,625
loan losses
Loans            $1,323,981 $794,623   $763,416   $739,028   $696,872
Adjusted
allowance for    3.70%        2.54%        2.70%        2.86%        3.10%
loan losses to
loans (Non-GAAP)
                                                                
TANGIBLE COMMON                                                  
EQUITY
                                                                
Total
stockholder's    $229,873   $172,399   $173,941   $171,511   $169,881
equity (GAAP)
Less: Preferred  42,437       24,715       24,657       24,601       24,544
stock
Less: Goodwill
and other        32,597       28,520       28,630       28,741       28,851
intangible
assets, net
Tangible common
equity           $154,839   $119,164   $120,654   $118,169   $116,486
(Non-GAAP)

QUARTERLY NET INTEREST MARGIN ANALYSIS

                    Three months ended           Three months ended           Three months ended
                    June 30, 2013                 March 31, 2013                June 30, 2012
(Dollars in          Average              Yield/  Average              Yield/  Average              Yield/
thousands)
                    Balance    Interest* Cost*  Balance    Interest* Cost*  Balance    Interest* Cost*
                                                                                              
Assets                                                                                         
Loans                $1,316,237 $20,376    6.21%   $783,023   $10,697    5.54%   $704,723   $10,707    6.11%
Investment           394,398    2,008      2.04    143,475    857        2.42    172,228    1,138      2.66
securities
Federal funds and    43,719     21         0.19    29,625     16         0.22    60,791     33         0.22
other
Total
interest-earning     1,754,354  22,405     5.12%   956,123    11,570     4.91%   937,742    11,878     5.09%
assets
Non-interest-earning 225,912                     134,333                     128,305              
assets
Total assets         $1,980,266                  $1,090,456                  $1,066,047           
                                                                                              
Liabilities and                                                                                
Equity
Interest-bearing     $333,215   183        0.22%   $183,667   139        0.31%   $144,283   $162       0.45%
demand
Money market and     484,685    346        0.29    264,917    343        0.53    234,163    395        0.68
savings
Time                 620,441    1,090      0.70    363,248    820        0.92    382,972    905        0.95
Total
interest-bearing     1,438,341  1,619      0.45    811,832    1,302      0.65    761,418    1,462      0.77
deposits
Short-term           58,292     42         0.29    7,200      12         0.68    2,889      4          0.56
borrowings
Long-term debt       45,465     313        2.76    23,211     270        4.72    22,764     311        5.49
Total
interest-bearing     1,542,098  1,974      0.51%   842,243    1,584      0.76%   787,071    1,777      0.91%
liabilities
Noninterest-bearing  192,459                     67,970                      100,767              
deposits
Other liabilities    8,846                       6,427                       7,237                
Total liabilities    1,743,403                   916,640                     895,075              
Stockholders' equity 236,863                     173,816                     170,972              
Total liabilities
and stockholders'    $1,980,266                  $1,090,456                  $1,066,047           
equity
                                                                                              
Net interest income,           $20,431                     $9,986                      $10,101    
taxable equivalent
Interest rate spread                     4.61%                       4.15%                       4.18%
Tax equivalent net                       4.67%                       4.24%                       4.33%
interest margin
                                                                                              
Percentage of
average
interest-earning                         113.76%                     113.52%                     119.14%
assets to average
interest-bearing
liabilities
* Taxable equivalent                                                                           
basis

YEAR-TO-DATE NET INTEREST MARGIN ANALYSIS

                    Successor Company                                               Predecessor Company
                    Six months ended               Period from February 1 to      Period from January 1 to
                    June 30, 2013                   June 30, 2012                   January 31, 2012
(Dollars in          Average                Yield/  Average                Yield/  Average                Yield/
thousands)
                    Balance      Interest* Cost*  Balance      Interest* Cost*  Balance      Interest* Cost*
                                                                                                    
Assets                                                                                               
Loans                $1,049,646 $31,073  5.97%   $717,407   $18,009  6.08%   $730,387   $3,807   6.15%
Investment           268,589      2,866      2.15    174,542      1,941      2.70    180,220      419        2.74
securities
Federal funds and    36,672       37         0.20    53,610       49         0.22    23,719       4          0.20
other
Total
interest-earning     1,354,907    33,976     5.06%   945,559      19,999     5.13%   934,326      4,230      5.35%
assets
Non-interest-earning 180,565                       121,443                       134,240                
assets
Total assets         $1,535,472                  $1,067,002                  $1,068,566           
                                                                                                    
Liabilities and                                                                                      
Equity
Interest-bearing     $258,441   323       0.25%   $151,751   $318     0.51%   $172,363   $108     0.74%
demand
Money market and     374,801      689        0.37    224,160      634        0.69    184,716      96         0.61
savings
Time                 491,845      1,909      0.78    386,767      1,505      0.94    404,999      326        0.95
Total
interest-bearing     1,125,087    2,921      0.52    762,678      2,457      0.78    762,078      530        0.82
deposits
Short-term           32,751       54         0.33    3,766        6          0.39    968          —          —
borrowings
Long-term debt       34,333       583        3.42    23,333       512        5.32    24,217       103        5.02
Total
interest-bearing     1,192,171    3,558      0.60%   789,777      2,975      0.91%   787,263      633        0.95%
liabilities
Noninterest-bearing  130,215                       100,070                       107,156                
deposits
Other liabilities    7,634                         6,739                         4,184                  
Total liabilities    1,330,020                     896,586                       898,603                
Stockholders' equity 205,452                       170,416                       169,963                
Total liabilities
and stockholders'    $1,535,472                  $1,067,002                  $1,068,566           
equity
                                                                                                    
Net interest income,             $30,418                     $17,024                     $3,597   
taxable equivalent
Interest rate spread                       4.46%                         4.22%                         4.40%
Tax equivalent net                         4.53%                         4.36%                         4.55%
interest margin
                                                                                                    
Percentage of
average
interest-earning                           113.65%                       119.72%                       118.68%
assets to average
interest-bearing
liabilities
* Taxable equivalent                                                                                 
basis

CONTACT: Terry Earley, CFO
         VantageSouth Bancshares, Inc.
         Phone: (919) 659-9015
         Email: Terry.Earley@vsb.com

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