Alabama National BanCorporation Announces Fourth Quarter and Year-end

    Business Editors

    BIRMINGHAM, Ala.--(BUSINESS WIRE)--Jan. 24, 2005--Alabama National BanCorporation ("ANB") (NASDAQ/NM: ALAB) today announced record earnings for the quarter and year ended December 31, 2004.
    For the 2004 fourth quarter, ANB reported earnings of $15.4 million, up 42.8% from the 2003 fourth quarter. Diluted earnings per share of $0.89 were up 8.3% from the year ago quarter. Diluted cash earnings per share were $0.92, up 10.4% from the 2003 fourth quarter. Total revenue grew to $62.6 million in the 2004 quarter, up 28.7% from $48.7 million in the year ago quarter. Noninterest income represented 27.6% of fourth quarter 2004 total revenue, down from 33.2% in the 2003 fourth quarter. ANB's taxable equivalent net interest margin improved to 3.84% for the 2004 quarter, up 11 basis points from the 2003 quarter.
    For the full year, ANB reported 2004 earnings of $54.6 million, up 33.1% from 2003's $41.0 million in earnings. Diluted earnings per share of $3.39 were up 7.1% from the $3.17 recorded for the 2003 full year. Diluted cash earnings per share of $3.52 were up 9.2% over 2003's $3.23. Total revenue for 2004 was $236.0 million, up 18.5% from 2003's $199.3 million. Noninterest income for the year represented 30.8% of total revenue, down from 2003's 39.3%. ANB's 2004 taxable equivalent net interest margin of 3.74% was 6 basis points above 2003's level.
    "We are pleased to be able to report another year of record earnings for Alabama National," said John H. Holcomb, III, Chairman and CEO. "Our company navigated the changing interest rate environment and its impact on fee income sources, with a shift in the share of revenue generation from noninterest income to net interest income. Our employees have accomplished a number of important tasks in the last year. We are proud to have completed the acquisition and integration of three outstanding Florida banks during 2004. Our employees did an excellent job in successfully tackling these mergers and integrations in 2004. We are also very pleased to have associated ourselves with a group of excellent bankers at Indian River National Bank and CypressCoquina Bank."
    "We are also enthusiastic about the additional capital we raised in 2004," continued Holcomb. "While the issuance of an additional 977,500 shares results in some short-term earnings per share dilution, we believe this offering provides the company with capital to support future growth opportunities in our markets. We plan to continue our expansion in growth markets while retaining our focus on the importance of long term compounded growth in diluted earnings per share."
    Total assets at year-end 2004 of $5.3 billion were up 39.2% from 2003's $3.8 billion, driven by a combination of three acquisitions and loan growth. Deposits similarly grew 42.9% from year-end 2003 to $3.9 billion at December 31, 2004. Year-end share owners' equity was $530.3 million, or $31.20 per share, up $9.44 from December 31, 2003. Year-end 2004 tangible book value per share of $21.99 was up $3.00 from December 31, 2003.
    During the fourth quarter, ANB recognized $138 thousand in net charge-offs, bringing the year to date figure to 0.06% of average loans. ANB's 2004 provision expense for loan losses covered net charge-offs 269%. Year-end nonperforming assets were 0.28% of period end loans and other real estate. The allowance for loan losses covered nonperforming loans 576%.
    ANB is a bank holding company operating 83 banking locations through thirteen bank subsidiaries in Alabama, Florida and Georgia. Alabama subsidiaries include: Birmingham-based National Bank of Commerce (NBC), First American Bank in Decatur/Huntsville, Athens and Auburn/Opelika; First Citizens Bank in Talladega; Bank of Dadeville; Alabama Exchange Bank in Tuskegee and First Gulf Bank in Baldwin County. Florida subsidiaries are: Citizens & Peoples Bank, N.A. in Pensacola; Community Bank of Naples, N.A.; Millennium Bank in Gainesville; Public Bank in metropolitan Orlando; CypressCoquina Bank in Ormond Beach; and Indian River National Bank in Vero Beach. ANB has one subsidiary in Georgia, Georgia State Bank in metropolitan Atlanta. ANB provides full banking services to individuals and businesses. Brokerage services are provided to customers through NBC's wholly owned subsidiary, NBC Securities, Inc. Investments are not bank guaranteed, not FDIC insured and may lose value. Insurance services are provided through ANB Insurance Services, Inc., a wholly owned subsidiary of First American Bank.
    Alabama National BanCorporation common stock is traded on the Nasdaq National Market System under the symbol "ALAB."

    Conference Call Instructions:

    Alabama National will discuss financial results for the fourth quarter and year-end completed December 31, 2004 as well as its goals and general outlook for 2005 in a conference call to be held Tuesday, January 25, 2005 at 8:30 a.m. Central Time. A listen-only simulcast and replay of Alabama National's conference call will be available on-line at the following Internet links: www.alabamanational.com, under "In The News," or www.viavid.net, on January 25, beginning at 8:30 a.m. Central Time. The on-line replay will follow immediately and continue for 30 days.
    For live interactive access to the teleconference, please dial 800-938-1464 at 8:30 a.m. Central Time on January 25. For those without Internet access, a telephonic replay will be available through February 25 by dialing 800-642-1687 and entering Conference ID number 3242935.
    Many of the comparisons of financial data from period to period presented in the narrative of this release have been rounded from actual values reported in the attached selected unaudited financial tables. The percentage changes presented above are based on a comparison of the actual values recorded in the attached tables, not the rounded values.
    This press release, including the attached selected unaudited financial tables which are a part of this release, contains financial information determined by methods other than in accordance with Generally Accepted Accounting Principles ("GAAP"). These "non-GAAP" financial measures are "cash earnings" (cash earnings per share), "tangible book value" (tangible book value per share), "return on average tangible equity" and "return on average tangible assets." ANB's management uses these non-GAAP measures in its analysis of ANB's performance. Cash earnings is defined as net income plus amortization expense (net of tax) applicable to intangible assets that do not qualify as regulatory capital. Cash earnings per basic and diluted share is defined as cash earnings divided by basic and diluted common shares outstanding. ANB's management includes cash earnings measures to compare the company's earnings exclusive of non-cash amortization expense and because it is a measure used by many investors as part of their analysis of ANB's performance. Tangible book value is defined as total equity reduced by recorded intangible assets. Tangible book value per share is defined as tangible book value divided by total common shares outstanding. This measure is important to many investors in the marketplace that are interested in changes from period to period in book value per share exclusive of changes in intangible assets. Goodwill, an intangible asset that is recorded in a purchase business combination, has the effect of increasing total book value while not increasing the tangible assets of the company. For companies such as Alabama National that have engaged in multiple business combinations purchase accounting requires the recording of significant amounts of goodwill related to such transactions. Return on average tangible equity is defined as earnings for the period (annualized for the quarterly period) divided by average equity reduced by average goodwill and other intangible assets. Return on average tangible assets is defined as earnings for the period (annualized for the quarterly period) divided by average assets reduced by average goodwill and other intangible assets. ANB's management includes these measures because it believes that they are important when measuring the company's performance exclusive of the effects of goodwill and other intangibles recorded in recent acquisitions, and these measures are used by many investors as part of their analysis of ANB. These disclosures should not be viewed as a substitute for results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Refer to the "Reconciliation Table" in the attached schedules for a more detailed analysis of these non-GAAP performance measures and the most directly comparable GAAP measures.
    This press release contains forward-looking statements as defined by federal securities laws. Statements contained in this press release which are not historical facts are forward-looking statements. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. ANB undertakes no obligation to update these statements following the date of this press release. In addition, ANB, through its senior management, may make from time to time forward-looking public statements concerning the matters described herein. Such forward-looking statements are necessarily estimates reflecting the best judgment of ANB's senior management based upon current information and involve a number of risks and uncertainties. Certain factors which could affect the accuracy of such forward-looking statements are identified in the public filings made by ANB with the Securities and Exchange Commission, and forward looking statements contained in this press release or in other public statements of ANB or its senior management should be considered in light of those factors. There can be no assurance that such factors or other factors will not affect the accuracy of such forward-looking statements.

ALABAMA NATIONAL BANCORPORATION (Unaudited Financial Highlights) (in thousands, except per share amounts and percentages)

Three Months Ended December 31, ------------------ Percentage 2004 2003 Change (b) ------- ------- -----------

Net interest income $45,334 $32,505 39.5% Noninterest income 17,291 16,151 7.1 Total revenue 62,625 48,656 28.7 Provision for loan and lease losses 819 2,020 (59.5) Noninterest expense 38,331 30,439 25.9 Net income before income taxes 23,475 16,197 44.9 Income taxes 8,088 5,421 49.2 Net income $15,387 $10,776 42.8

Weighted average common and common equivalent shares outstanding Basic 17,131 12,950 32.3% Diluted 17,368 13,177 31.8

Net income per common share Basic $ .90 $ .83 7.9% Diluted .89 .82 8.3

Cash earnings (a) Total $15,964 $10,975 45.5% Basic .93 .85 10.0 Diluted .92 .83 10.4

Cash dividends declared on common stock $ .3125 $ .285 Return on average assets 1.17% 1.13% Return on average tangible assets 1.21 1.14 Return on average equity 11.59 15.40 Return on average tangible equity 16.53 17.72

Noninterest Income

Service charge income $ 4,258 $ 3,655 16.5% Investment services income 1,787 2,623 (31.9) Securities brokerage and trust income 4,511 3,849 17.2 Gain on sale of mortgages 2,681 2,862 (6.3) Gain (loss) on disposal of assets 43 (59) NM Securities gains - 3 NM Bank owned life insurance 643 695 (7.5) Insurance commissions 1,034 1,042 (.8) Other 2,334 1,481 57.6 ------- ------- Total noninterest income $17,291 $16,151 7.1 ======= =======

(a) Cash basis earnings exclude the effect on earnings of amortization expense applicable to intangible assets that do not qualify as regulatory capital. (b) Percentage change based on actual not rounded values. NM - Not meaningful

For the Year Ended December 31, -------------------- Percentage 2004 2003 Change (b) -------- -------- -----------

Net interest income $163,252 $120,963 35.0% Noninterest income 72,785 78,304 (7.0) Total revenue 236,037 199,267 18.5 Provision for loan and lease losses 4,949 5,931 (16.6) Noninterest expense 148,322 131,892 12.5 Net income before income taxes 82,766 61,444 34.7 Income taxes 28,122 20,398 37.9 Net income $ 54,644 $ 41,046 33.1

Weighted average common and common equivalent shares outstanding Basic 15,848 12,748 24.3% Diluted 16,100 12,957 24.3

Net income per common share Basic $ 3.45 $ 3.22 7.1% Diluted 3.39 3.17 7.1

Cash earnings (a) Total $ 56,705 $ 41,791 35.7% Basic 3.58 3.28 9.1 Diluted 3.52 3.23 9.2

Cash dividends declared on common stock $ 1.25 $ 1.14 Return on average assets 1.13% 1.14% Return on average tangible assets 1.16 1.15 Return on average equity 12.15 15.89 Return on average tangible equity 17.19 17.90

Noninterest Income

Service charge income $ 17,126 $ 14,091 21.5% Investment services income 11,652 18,710 (37.7) Securities brokerage and trust income 16,863 15,867 6.3 Gain on sale of mortgages 11,566 16,289 (29.0) Gain (loss) on disposal and liquidation of assets 12 822 NM Securities gains - 46 NM Bank owned life insurance 2,690 2,747 (2.1) Insurance commissions 3,604 3,477 3.7 Other 9,272 6,255 48.2 -------- -------- Total noninterest income $ 72,785 $ 78,304 (7.0) ======== ========

(a) Cash basis earnings exclude the effect on earnings of amortization expense applicable to intangible assets that do not qualify as regulatory capital. (b) Percentage change based on actual not rounded values. NM - Not meaningful

December 31, ----------------------- Percentage 2004 2003 Change ---------- ---------- ----------- Total assets $5,316,641 $3,820,112 39.2% Earning assets 4,841,255 3,512,744 37.8 Securities (a) 1,200,407 810,227 48.2 Loans held for sale 22,313 16,415 35.9 Loans and leases, net of unearned income 3,495,701 2,659,440 31.4 Allowance for loan and lease losses 46,584 36,562 27.4 Deposits 3,934,723 2,753,749 42.9 Short-term borrowings 30,500 41,150 (25.9) Long-term debt 393,697 332,427 18.4 Stockholders' equity 530,315 279,418 89.8

(a) Excludes trading securities

ASSET QUALITY ANALYSIS (in thousands, except percentages)

As of / For the Three Months Ended December September December 31, 2004 30, 2004 31, 2003 ----------- ----------- ----------- Nonaccrual loans $ 8,091 $ 8,252 $ 9,817 Restructured loans 0 0 0 Loans past due 90 days or more and still accruing 0 0 0 Total nonperforming loans 8,091 8,252 9,817 Other real estate owned 1,531 1,639 699 Total nonperforming assets 9,622 9,891 10,516 Total non performing assets as a percentage of period-end loans and other real estate (a) 0.28% 0.29% 0.40% Allowance for loan and lease losses 46,584 45,903 36,562 Provision for loan and lease losses 819 1,624 2,020 Loans charged off 639 825 3,123 Loan recoveries 501 251 686 Net loan and lease losses 138 574 2,437 Allowance for loan and lease losses as a percentage of period-end loans and leases (a) 1.33% 1.35% 1.37% Allowance for loan and lease losses as a percentage of period-end nonperforming loans 575.75 556.27 372.44 Net losses to average loans and leases (annualized) 0.02 0.07 0.37

For the Year Ended December 31, ----------------------- Percentage 2004 2003 Change ---------- ---------- ----------- Provision for loan and lease losses $ 4,949 $ 5,931 -16.6% Loans charged off 4,583 5,819 (21.2) Loan recoveries 2,746 2,751 (.2) Net loan and lease losses 1,837 3,068 (40.1) Net losses to average loans and leases 0.06% 0.12%

(a) Excludes loans held for sale NM - Not meaningful

TAXABLE EQUIVALENT YIELDS/RATES Three Months Ended December September December 31, 2004 30, 2004 31, 2003 ----------- ----------- ----------- Interest income: Interest and fees on loans 5.96% 5.73% 5.74% Interest on securities: Taxable 4.02 4.05 3.83 Non-taxable 6.04 6.05 6.14 Total interest earning assets 5.42 5.27 5.27

Interest expense: Interest on deposits 1.65 1.54 1.67 Interest on short-term borrowing 2.68 1.99 0.88 Interest on long-term debt 3.55 3.41 3.43 Total interest bearing liabilities 1.87 1.72 1.77 Net interest spread 3.55 3.55 3.50 Net interest margin 3.84 3.81 3.73

For the Year Ended December 31, ----------------------- 2004 2003 ---------- ---------- Interest income: Interest and fees on loans 5.74% 5.95% Interest on securities: Taxable 3.95 4.00 Non-taxable 6.16 6.83 Total interest earning assets 5.24 5.42

Interest expense: Interest on deposits 1.58 1.90 Interest on short-term borrowing 1.94 1.78 Interest on long-term debt 3.42 3.76 Total interest bearing liabilities 1.75 1.98 Net interest spread 3.49 3.44 Net interest margin 3.74 3.68

STOCKHOLDERS' EQUITY AND CAPITAL RATIOS

As of December 31, ---------------------- 2004 2003 ---------- ----------

Stockholders' Equity: Equity to assets 9.97% 7.31% Leverage ratio 8.44 7.73 Book value per common share (a) $ 31.20 $ 21.76 Tangible book value per common share (a)(b) 21.99 18.99 Ending shares outstanding 16,999 12,839

(a) Includes a cumulative mark to market adjustment to equity of $(0.06) and $0.01 per share at December 31, 2004 and 2003, respectively. (b) Total equity reduced by intangible assets divided by common shares outstanding.

RECONCILIATION TABLE (In thousands, except per share data)

Three Months Ended Year Ended December 31, December 31, ------------ ------------ 2004 2003 2004 2003 ---------- ---------- ---------- ---------- Net income $ 15,387 $ 10,776 $ 54,644 $ 41,046 Amortization of intangibles, net of tax 577 199 2,061 745 Cash earnings $ 15,964 $ 10,975 $ 56,705 $ 41,791

Net income per basic share $ 0.90 $ 0.83 $ 3.45 $ 3.22 Amortization of intangibles per basic share 0.03 0.02 0.13 0.06 Cash earnings per basic share $ 0.93 $ 0.85 $ 3.58 $ 3.28

Net income per diluted share $ 0.89 $ 0.82 $ 3.39 $ 3.17 Amortization of intangibles per diluted share 0.03 0.01 0.13 0.06 Cash earnings per diluted share $ 0.92 $ 0.83 $ 3.52 $ 3.23

Book value $ 530,315 $ 279,418 $ 530,315 $ 279,418 Intangible assets (156,454) (35,587) (156,454) (35,587) Tangible book value $ 373,861 $ 243,831 $ 373,861 $ 243,831

Book value per common share $ 31.20 $ 21.76 $ 31.20 $ 21.76 Effect of intangible assets per share (9.21) (2.77) (9.21) (2.77) Tangible book value per share $ 21.99 $ 18.99 $ 21.99 $ 18.99

Average assets $5,219,630 $3,777,137 $4,838,494 $3,603,847 Average intangible assets (157,929) (36,332) (131,784) (29,093) Average tangible assets $5,061,701 $3,740,805 $4,706,710 $3,574,754

Return on average assets 1.17% 1.13% 1.13% 1.14% Effect of average intangible assets 0.04 0.01 0.03 0.01 Return on average tangible assets 1.21% 1.14% 1.16% 1.15%

Average equity $ 528,229 $ 277,597 $ 449,583 $ 258,348 Average intangible assets (157,929) (36,332) (131,784) (29,093) Average tangible equity $ 370,300 $ 241,265 $ 317,799 $ 229,255

Return on average equity 11.59% 15.40% 12.15% 15.89% Effect of average intangible assets 4.94 2.32 5.04 2.01 Return on average tangible equity 16.53% 17.72% 17.19% 17.90%

Alabama National BanCorporation and Subsidiaries Consolidated Statements of Financial Condition (Unaudited) ---------------------------------------------------------- (In thousands, except share amounts)

December 31, December 31, 2004 2003 ------------ ------------

Assets Cash and due from banks $ 155,027 $ 123,086 Interest-bearing deposits in other banks 21,274 10,019 Federal funds sold and securities purchased under resell agreements 100,970 16,534 Trading securities, at fair value 590 109 Investment securities (fair value $566,602 and $271,536, respectively) 568,493 271,035 Securities available for sale, at fair value 631,914 539,192 Loans held for sale 22,313 16,415 Loans and leases 3,499,353 2,662,358 Unearned income (3,652) (2,918) ---------- ---------- Loans and leases, net of unearned income 3,495,701 2,659,440 Allowance for loan and lease losses (46,584) (36,562) ---------- ---------- Net loans and leases 3,449,117 2,622,878 Property, equipment and leasehold improvements, net 99,455 77,291 Goodwill 145,168 30,964 Other intangible assets, net 11,286 4,623 Cash surrender value of life insurance 71,535 59,425 Receivable from investment division customers 2,223 12,966 Other assets 37,276 35,575 ---------- ---------- Total assets $5,316,641 $3,820,112 ========== ==========

Liabilities and Stockholders' Equity Deposits: Noninterest bearing $ 683,245 $ 404,755 Interest bearing 3,251,478 2,348,994 ---------- ---------- Total deposits 3,934,723 2,753,749 Federal funds purchased and securities sold under repurchase agreements 379,114 358,393 Treasury, tax and loan accounts 2,217 1,431 Accrued expenses and other liabilities 43,852 41,577 Payable for securities purchased for investment division customers 2,223 11,967 Short-term borrowings 30,500 41,150 Long-term debt 393,697 332,427 ---------- ---------- Total liabilities 4,786,326 3,540,694

Common stock, $1 par, 27,500,000 shares authorized;16,998,918 and 12,838,844 shares issued at December 31, 2004 and 2003, respectively 16,999 12,839 Additional paid-in capital 340,933 126,370 Retained earnings 173,345 140,028 Accumulated other comprehensive income, net of tax (962) 181 ---------- ---------- Total stockholders' equity 530,315 279,418 ---------- ---------- Total liabilities and stockholders' equity $5,316,641 $3,820,112 ========== ==========

Alabama National BanCorporation and Subsidiaries Consolidated Statements of Income (Unaudited) ----------------------------------------------- (In thousands, except per share data)

For the three months For the year ended December 31, ended December 31, -------------------- ---------------------- 2004 2003 2004 2003 --------- --------- ---------- ----------

Interest income: Interest and fees on loans and leases $51,832 $37,890 $184,464 $145,931 Interest on securities 11,778 7,995 43,611 31,873 Interest on deposits in other banks 19 12 65 98 Interest on trading securities 11 18 55 94 Interest on federal funds sold and securities purchased under resell agreements 447 104 991 635 ------- ------- -------- -------- Total interest income 64,087 46,019 229,186 178,631

Interest expense: Interest on deposits 12,945 9,736 46,348 42,231 Interest on federal funds purchased and securities sold under repurchase agreements 1,991 843 5,345 3,278 Interest on short-term borrowings 262 118 1,027 1,431 Interest on long-term debt 3,555 2,817 13,214 10,728 ------- ------- -------- -------- Total interest expense 18,753 13,514 65,934 57,668 ------- ------- -------- -------- Net interest income 45,334 32,505 163,252 120,963 Provision for loan losses 819 2,020 4,949 5,931 ------- ------- -------- -------- Net interest income after provision for loan losses 44,515 30,485 158,303 115,032

Noninterest income: Securities gains - 3 - 46 Gain (loss) on disposition and liquidation of assets 43 (59) 12 822 Service charges on deposit accounts 4,258 3,655 17,126 14,091 Investment services income 1,787 2,623 11,652 18,710 Securities brokerage and trust income 4,511 3,849 16,863 15,867 Gain on sale of mortgages 2,681 2,862 11,566 16,289 Bank owned life insurance 643 695 2,690 2,747 Insurance commissions 1,034 1,042 3,604 3,477 Other 2,334 1,481 9,272 6,255 ------- ------- -------- -------- Total noninterest income 17,291 16,151 72,785 78,304

Noninterest expense: Salaries and employee benefits 18,682 16,094 74,983 64,826 Commission based compensation 3,594 3,897 17,500 22,182 Occupancy and equipment expenses 4,038 3,190 15,488 12,886 Amortization of intangibles 852 279 3,034 1,041 Penalty on long-term debt repayment - - - 822 Other 11,165 6,979 37,317 30,135 ------- ------- -------- -------- Total noninterest expense 38,331 30,439 148,322 131,892 ------- ------- -------- --------

Income before provision for income taxes 23,475 16,197 82,766 61,444 Provision for income taxes 8,088 5,421 28,122 20,398 ------- ------- -------- -------- Net income $15,387 $10,776 $ 54,644 $ 41,046 ======= ======= ======== ========

Net income per common share (basic) $ .90 $ .83 $ 3.45 $ 3.22 ======= ======= ======== ========

Weighted average common shares outstanding (basic) 17,131 12,950 15,848 12,748 ======= ======= ======== ========

Net income per common share (diluted) $ .89 $ .82 $ 3.39 $ 3.17 ======= ======= ======== ========

Weighted average common shares outstanding (diluted) 17,368 13,177 16,100 12,957 ======= ======= ======== ========

AVERAGE BALANCES, INCOME AND EXPENSES AND RATES (Amounts in thousands, except yields and rates)

Three Months 12/31/04 Three Months 12/31/03 -------------------------- ------------------------- Average Income/ Yield/ Average Income/ Yield/ Balance Expense Cost Balance Expense Cost --------- ------- ------- -------- ------- ------ Assets: Earning assets: Loans and leases (1) $3,467,225 $51,973 5.96% $2,622,997 $37,974 5.74% Securities: Taxable 1,108,835 11,194 4.02 785,886 7,594 3.83 Tax exempt 58,249 885 6.04 38,656 599 6.14 Cash balances in other banks 6,255 19 1.21 5,748 12 0.83 Funds sold 97,515 447 1.82 31,525 104 1.31 Trading account securities 1,020 11 4.29 2,082 18 3.43 ---------- ------ ---------- ------ Total earning assets (2) 4,739,099 64,529 5.42 3,486,894 46,301 5.27 ---------- ------ ---------- ------ Cash and due from banks 149,266 119,051 Premises and equipment 96,893 77,307 Other assets 280,773 131,507 Allowance for loan and lease losses (46,401) (37,623) ---------- ---------- Total assets $5,219,630 $3,777,137 ========== ==========

Liabilities: Interest-bearing liabilities: Interest-bearing transaction accounts $ 804,670 $ 1,870 0.92 $ 514,842 $ 894 0.69 Savings deposits 853,405 2,193 1.02 509,951 1,073 0.83 Time deposits 1,457,029 8,882 2.43 1,284,335 7,769 2.40 Funds purchased 435,093 1,991 1.82 338,785 843 0.99 Other short-term borrowings 38,858 262 2.68 52,936 118 0.88 Long-term debt 398,198 3,555 3.55 325,999 2,817 3.43 ---------- ------ ---------- ------ Total interest- bearing liabilities 3,987,253 18,753 1.87 3,026,848 13,514 1.77 ---------- ------ ---------- ------ Demand deposits 636,073 422,691 Accrued interest and other liabilities 68,074 50,000 Stockholders' equity 528,229 277,597 ---------- ---------- Total liabilities and stockholders' equity $5,219,630 $3,777,137 ========== ==========

Net interest spread 3.55% 3.50% ======= ======= Net interest income/margin on a taxable equivalent basis 45,776 3.84% 32,787 3.73% ======= ======= Tax equivalent adjustment (2) 442 282 ------ ------ Net interest income/margin $45,334 3.81% $32,505 3.70% ====== ======= ====== =======

(1) Average loans include nonaccrual loans. All loans and deposits are domestic. (2) Tax equivalent adjustments are based on the assumed rate of 34%, and do not give effect to the disallowance for Federal income tax purposes of interest expense related to certain tax-exempt assets.

AVERAGE BALANCES, INCOME AND EXPENSES AND RATES (Amounts in thousands, except yields and rates)

Year Ended 12/31/04 Year Ended 12/31/03 -------------------------- ------------------------- Average Income/ Yield/ Average Income/ Yield/ Balance Expense Cost Balance Expense Cost --------- ------- ------- -------- ------- ------ Assets: Earning assets: Loans and leases (1) $3,223,989 $184,935 5.74% $2,459,250 $146,223 5.95% Securities: Taxable 1,049,274 41,468 3.95 758,506 30,359 4.00 Tax exempt 52,717 3,247 6.16 33,104 2,260 6.83 Cash balances in other banks 6,225 65 1.04 10,024 98 0.98 Funds sold 68,651 991 1.44 49,338 635 1.29 Trading account securities 1,244 55 4.42 2,536 94 3.71 --------- ------- --------- ------- Total earning assets (2) 4,402,100 230,761 5.24 3,312,758 179,669 5.42 --------- ------- --------- ------- Cash and due from banks 143,433 95,686 Premises and equipment 90,388 75,319 Other assets 246,108 155,386 Allowance for loan and lease losses (43,535) (35,302) --------- --------- Total assets $4,838,494 $3,603,847 ========= =========

Liabilities: Interest-bearing liabilities: Interest-bearing transaction accounts $722,774 $5,738 0.79 $509,343 $4,376 0.86 Savings deposits 771,993 7,234 0.94 471,725 4,359 0.92 Time deposits 1,434,798 33,376 2.33 1,242,100 33,496 2.70 Funds purchased 402,991 5,345 1.33 317,811 3,278 1.03 Other short-term borrowings 53,027 1,027 1.94 80,586 1,431 1.78 Long-term debt 386,477 13,214 3.42 285,456 10,728 3.76 --------- ------- --------- ------ Total interest- bearing liabilities 3,772,060 65,934 1.75 2,907,021 57,668 1.98 --------- ------- --------- ------ Demand deposits 563,349 382,498 Accrued interest and other liabilities 53,502 55,980 Stockholders' equity 449,583 258,348 --------- --------- Total liabilities and stockholders' equity $4,838,494 $3,603,847 ========= =========

Net interest spread 3.49% 3.44% ===== ===== Net interest income/margin on a taxable equivalent basis 164,827 3.74% 122,001 3.68% ===== ===== Tax equivalent adjustment (2) 1,575 1,038 ------- ------- Net interest income/margin $163,252 3.71% $120,963 3.65% ======= ===== ======= =====

(1) Average loans include nonaccrual loans. All loans and deposits are domestic. (2) Tax equivalent adjustments are based on the assumed rate of 34%, and do not give effect to the disallowance for Federal income tax purposes of interest expense related to certain tax-exempt assets.

--30--CB/na*

CONTACT: Alabama National BanCorporation, Birmingham John H. Holcomb III, 205-583-3648 or William E. Matthews, V, 205-583-3650

KEYWORD: ALABAMA GEORGIA FLORIDA INDUSTRY KEYWORD: BANKING EARNINGS CONFERENCE CALLS SOURCE: Alabama National BanCorporation

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