Sun Bancorp, Inc. Reports Fourth Quarter and Full Year Results for 2007

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| Source: Sun Bancorp, Inc.

VINELAND, N.J., Jan. 22, 2008 (PRIME NEWSWIRE) -- Sun Bancorp, Inc. (Nasdaq:SNBC) today reported net income of $3.9 million, or $.17 per share diluted, for the quarter ended December 31, 2007, compared to net income of $4.5 million, or $.20 per share diluted, for the fourth quarter of 2006. Net income for the fourth quarter 2006 includes pre-tax charges of approximately $1.1 million ($.03 per share) related to two branch consolidations and severance expense.

Net income for the year ended December 31, 2007 was $19.4 million, or $.86 per share diluted, compared to net income of $17.3 million, or $.77 per share diluted, for the prior year. The full-year 2007 results included net-charges of approximately $2.1 million (pre-tax), or $.06 per share. The net charges include $2.4 million of severance and other related expenses, a $915,000 write-off of unamortized issuance costs of redeemed trust preferred securities and early extinguishment of debt charges on FHLB borrowings, and $185,000 of branch consolidation charges. Offsetting these charges was a pre-tax gain of $1.4 million realized from the sale of three branches. The prior year included approximately $1.6 million (pre-tax), or $.05 per share, in branch rationalization and severance related charges.

"As we closed out 2007 with expectations that the difficult operating environment will continue indefinitely, credit quality is first and foremost on everyone's mind. Accordingly, during the quarter we charged off $4.8 million of delinquent loans and recorded a $5.4 million loan loss provision to maintain adequate reserve coverage (1.08%). These charge-offs and loan loss provision exceeded our previously announced levels. This positions us well for forward progress, when combined with favorable performance trends throughout 2007 for our net interest margin, non-interest income growth and expense control," said Thomas X. Geisel, president and chief executive officer of Sun Bancorp. "Our credit risk assessment process is being administered by a seasoned team and we are optimistic that we can maintain loan quality while the lenders produce respectable growth throughout the various segments of the portfolio."

"During 2007, market conditions enabled us to repurchase 1,010,523 shares of our outstanding common stock, thus completing in late December a plan that authorized the buyback of about 5%, or approximately 1,000,000 shares. Of the total, 467,545 shares were repurchased during the fourth quarter. The Board subsequently authorized a new stock repurchase plan covering up to approximately 5%, or approximately 1,100,000 additional shares, of common stock to be purchased in the open market or in privately negotiated transactions. We expect to continue to be an active purchaser of our stock as opportunities arise," said Geisel.

The following is an overview of the key financial highlights:



 --  Total assets were $3.338 billion at December 31, 2007, compared
     to $3.296 billion at September 30, 2007 and $3.326 billion at
     December 31, 2006.

 --  Total loans before allowance for loan losses were $2.510 billion
     at December 31, 2007, an increase of $143.3 million, or 6.1% over
     total loans at December 31, 2006. Linked quarter loan growth
     normalized for prepayments of about $39.0 million during the
     quarter approximated 3.0%. Total loan growth over year end 2006
     normalized for prepayments and a branch sale approximates 13.1%.

 --  Total non-performing assets were $29.6 million at December 31,
     2007, or 1.18% of total loans and real estate owned, compared to
     $15.2 million, or .64% of total loans and real estate owned, at
     December 31, 2006. On a linked quarter basis, total
     non-performing assets increased $7.5 million. Net charge-offs for
     the quarter were $4.8 million and the loan loss provision for the
     quarter was $5.4 million. The allowance for loan losses to total
     loans is 1.08% at December 31, 2007, compared to 1.08% at
     December 31, 2006 and 1.06% at September 30, 2007.

 --  Total deposits were $2.699 billion at December 31, 2007, an
     increase of $31.1 million, or 1.2% over deposits at December 31,
     2006. On average, total deposits increased 3.8% year-to-year.
     Total deposits increased approximately 1% over the linked
     quarter.

 --  Net interest income (tax-equivalent basis) of $26.2 million for
     the quarter compares to $24.8 million for the comparable prior
     year period and $25.8 million for the linked third quarter. The
     net interest margin for the quarter of 3.52% compares to 3.37%
     for the comparable prior year period and 3.49% for the linked
     third quarter. The linked quarter margin improvement reflects a
     net spread increase of 12 basis points. This increase is due to a
     decrease of 25 basis points in the cost of interest-bearing
     liabilities offset by a decrease in yield on earning assets of 13
     basis points.

 --  Total operating non-interest income for the quarter of $6.5
     million increased $1.1 million, or 21.3% over the comparable
     prior year period and increased $471,000, or 7.8% over the linked
     third quarter. The increase over the prior year period was
     attributable to increases in service charges on deposit accounts
     of $238,000, an increase in net gain on derivative instruments of
     $311,000 and an increase in BOLI income of $585,000. The increase
     over the linked quarter was primarily related to an increase in
     BOLI income of $506,000, an increase in gain on derivative
     instruments of $214,000 offset partially by a decrease in service
     charges on deposit accounts of $164,000. During the quarter, the
     Company completed a conversion of approximately $40.4 million of
     its existing general account BOLI to a new separate account
     policy. The net conversion cost for this transaction resulted in
     the recognition of $301,000 in BOLI income and $416,000 in
     federal income tax expense for the quarter. Total operating
     non-interest income for the year 2007 of $24.4 million increased
     $4.3 million, or 21.2% over 2006. The primary increases were
     related to an increase in service charges on deposit accounts of
     $2.6 million, an increase in gain on derivative instruments of
     $389,000, an increase in BOLI income of $684,000 and an increase
     in gain on sale of loans of $562,000. Total operating
     non-interest income for the year 2007 represents approximately
     20.0% of total revenue compared to 2006 at approximately 17.0%.

 --  Total operating non-interest expenses for the quarter of $21.5
     million increased $374,000, or 1.8% over the comparable prior
     year period. The primary increase is FDIC insurance expense
     which increased over the prior period by $392,000 due to the FDIC
     reform legislation effective for 2007. Total operating
     non-interest expense decreased approximately 1.0% over the linked
     third quarter. Total operating non-interest expenses for the year
     of $86.3 million decreased $1.9 million, or 2.2% over the prior
     year. The full year impact of increased FDIC insurance expense
     over the prior year was $971,000. The efficiency ratio for the
     quarter of 66.61% compares to the comparable prior year period
     efficiency ratio of 74.06%. The efficiency ratio has continued to
     trend favorably each quarter of 2007. The efficiency ratio for
     the year, excluding the non-operating income and expenses items
     previously noted, is 69.37% and compares to the prior year on the
     same basis, at 73.97%. This continues to reflect the Company's
     focus on ongoing profitability enhancement initiatives with
     particular emphasis on expense efficiency savings.

The Company will hold its regular quarterly conference call on Wednesday, January 23, 2008 at 9:30 a.m. (ET). Participants may call 1-800-391-2548 and give the verbal password: vi36443. The conference call also will be Web cast live through the Sun Bancorp Web site at www.sunnb.com. Participants are advised to call in or log on 10 minutes ahead of the scheduled start of the call. An Internet-based replay will be available at the Web site for two weeks following the call.

Sun Bancorp, Inc. is a multi-state bank holding company headquartered in Vineland, New Jersey. Its primary subsidiary is Sun National Bank, serving customers through 70 branch locations in Southern and Central New Jersey and New Castle County, Delaware. The Bank is an Equal Housing Lender and its deposits are insured up to the legal maximum by the Federal Deposit Insurance Corporation (FDIC). For more information about Sun National Bank and Sun Bancorp, Inc., visit www.sunnb.com.

The foregoing material contains forward-looking statements concerning the financial condition, results of operations and business of the Company. We caution that such statements are subject to a number of uncertainties and actual results could differ materially, and, therefore, readers should not place undue reliance on any forward-looking statements. The Company does not undertake, and specifically disclaims, any obligation to publicly release the results of any revisions that may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.



 SUN BANCORP, INC. AND SUBSIDIARIES
 FINANCIAL HIGHLIGHTS (unaudited)
 (Dollars in thousands, except per share data)

                                   For the Three           For the
                                    Months Ended         Years Ended
                                    December 31,         December 31,
                                 -----------------   -----------------
                                   2007      2006     2007       2006
                                 -------   -------   -------   -------
 Profitability for the period:
   Net interest income           $25,838   $24,545   $99,176   $99,078
   Provision for loan losses       5,443       990     8,403     3,807
   Non-interest income             6,482     5,012    25,815    19,746
   Non-interest expense           21,528    21,889    88,963    89,393
   Income before income
    taxes                          5,349     6,678    27,625    25,624
   Net income                    $ 3,870   $ 4,454   $19,352   $17,274
                                 =======   =======   =======   =======
 Financial ratios:
   Return on average assets (1)     0.47%     0.54%     0.58%     0.53%
   Return on average equity (1)     4.26%     5.24%     5.45%     5.28%
   Return on average tangible
    equity (1),(2)                  7.33%     9.78%     9.61%    10.15%
   Net interest margin (1)          3.52%     3.37%     3.38%     3.44%
   Efficiency ratio                66.61%    74.06%    71.18%    75.23%
   Efficiency ratio, excluding
    non-operating income and
    non-operating expense (3)      66.61%    70.78%    69.37%    73.97%

   Earnings per common share (4):
     Basic                       $  0.18   $  0.21   $  0.89   $  0.81
     Diluted                     $  0.17   $  0.20   $  0.86   $  0.77

   Average equity to
    average assets                 10.93%    10.34%    10.72%    10.09%


                                             December 31,
                                     ---------------------------
                                        2007              2006
                                     ----------       ----------
 At period-end:
   Total assets                      $3,338,392       $3,325,563
   Total deposits                     2,699,091        2,667,997
   Loans receivable, net of
    allowance for loan losses         2,482,917        2,340,965
   Investments                          461,639          525,122
   Borrowings                           154,213          160,622
   Junior subordinated
    debentures                           97,941          108,250
   Shareholders' equity                 362,177          342,227

 Credit quality and capital
  ratios:
   Allowance for loan losses
    to gross loans                         1.08%            1.08%
   Non-performing assets to
    gross loans and real estate
    owned                                  1.18%            0.64%
   Allowance for loan losses
    to non-performing loans               95.77%          175.50%

   Total capital (to risk-
    weighted assets) (5)
       Sun Bancorp, Inc.                  11.93%           11.89%
       Sun National Bank                  11.08%           10.57%
   Tier 1 capital (to risk-
    weighted assets) (5)
       Sun Bancorp, Inc.                  10.95%           10.91%
       Sun National Bank                  10.11%            9.59%
   Leverage ratio (5)
       Sun Bancorp, Inc.                   9.67%            9.40%
       Sun National Bank                   8.98%            8.28%

   Book value                        $    16.68       $    15.89
   Tangible book value               $     9.71       $     8.62

 (1) Amounts for the three months ended are annualized.

 (2) Return on average tangible equity is computed by dividing
     annualized net income for the period by average tangible equity.
     Average tangible equity equals average equity less average
     identifiable intangible assets and goodwill.

 (3) Efficiency ratio, excluding non-operating income and
     non-operating expenses, is computed by dividing non-interest
     expense for the period by the summation of net interest income
     and non-interest income. Net interest income for the year ended
     December 31, 2007 excludes the write-off of $791,000 of
     unamortized costs on redeemed trust preferred securities.
     Non-interest income for the year ended December 31, 2007 excludes
     a net gain of $1.4 million from the sale of branches as compared
     to a net loss of $330,000 from the sale of bank property for the
     same period in 2006. Non-interest expense for the year ended
     December 31, 2007 excludes $2.4 million of severance related
     expenses and $185,000 in branch rationalization charges as
     compared to $740,000 of severance related expenses and $495,000
     in branch rationalization charges for the same period in 2006. In
     addition, non-interest expense for the year ended December 31,
     2007 excludes $124,000 resulting from the early extinguishment of
     FHLB borrowing. Non-interest income for the three months ended
     December 31, 2006 excludes a net loss of $330,000 from the sale
     of bank property. In addition, non-interest expense for the three
     months ended December 31, 2006 excludes $240,000 in severance
     related expenses and $495,000 in branch rationalization charges.

 (4) Data is adjusted for a 5% stock dividend declared in April 2007.

 (5) December 31, 2007 capital ratios are estimated, subject to
     regulatory filings.


 SUN BANCORP, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (unaudited)
 (Dollars in thousands, except par value)
                                              December 31,
                                     ---------------------------
                                        2007             2006
                                     ----------       ----------
 ASSETS
   Cash and due from banks           $   81,479       $   74,991
   Interest-earning bank
    balances                              2,380           48,066
   Federal funds sold                     2,654           47,043
                                     ----------       ----------
     Cash and cash equivalents           86,513          170,100
   Investment securities
    available for sale
    (amortized cost - $427,378
    and $488,007 December 31,
    2007 and December 31, 2006,
    respectively)                       425,805          481,952
   Investment securities held
    to maturity  (estimated
    fair value - $18,755 and
    $24,846 at December 31,
    2007 and December 31, 2006,
    respectively)                        18,965           25,441
   Loans receivable (net of
    allowance for loan losses -
    $27,002 and $25,658 at
    December 31, 2007 and
    December 31, 2006,
    respectively)                     2,482,917        2,340,965
   Restricted equity investments         16,869           17,729
   Bank properties and
    equipment, net                       48,118           42,292
   Real estate owned, net                 1,449              600
   Accrued interest receivable           15,018           14,657
   Goodwill                             127,894          128,117
   Intangible assets, net                23,479           28,570
   Deferred taxes, net                    3,169            3,939
   Bank owned life insurance             72,487           57,370
   Other assets                          15,709           13,831
                                     ----------       ----------
     Total assets                    $3,338,392       $3,325,563
                                     ==========       ==========


 LIABILITIES & SHAREHOLDERS' EQUITY
 LIABILITIES
   Deposits                          $2,699,091       $2,667,997
   Advances from the Federal
    Home Loan Bank (FHLB)                63,483          103,560
   Federal funds purchased               30,000               --
   Securities sold under
    agreements to repurchase
    - FHLB                               15,000               --
   Securities sold under
    agreements to repurchase
    - customers                          40,472           51,740
   Obligation under capital
    lease                                 5,258            5,322
   Junior subordinated
    debentures                           97,941          108,250
   Other liabilities                     24,970           46,467
                                     ----------       ----------
    Total liabilities                 2,976,215        2,983,336
                                     ==========       ==========

 SHAREHOLDERS' EQUITY
  Preferred stock, $1 par
   value, 1,000,000 shares
   authorized, none issued                   --               --
  Common stock, $1 par value,
   50,000,000 shares
   authorized, 22,722,655 and
   20,507,549 issued at
   December 31, 2007 and
   December 31, 2006,
   respectively                          22,723           20,508
  Additional paid-in capital            336,668          304,857
  Retained earnings                      20,338           20,794
  Accumulated other
   comprehensive loss                    (1,027)          (3,932)
  Treasury stock at cost,
   1,010,523 shares at
   December 31, 2007                    (16,525)              --
                                     ----------       ----------
    Total shareholders' equity          362,177          342,227
                                     ----------       ----------
    Total liabilities and
     shareholders' equity            $3,338,392       $3,325,563
                                     ==========       ==========

  SUN BANCORP, INC. AND SUBSIDIARIES
  CONSOLIDATED STATEMENTS OF INCOME (unaudited)
  (Dollars in thousands, except per share data)


                                      For the             For the
                                Three Months Ended      Years Ended
                                    December 31,        December 31,
                                ------------------  ------------------
                                  2007      2006      2007      2006
                                --------  --------  --------  --------
 INTEREST INCOME
   Interest and fees on loans   $ 43,991  $ 42,991  $174,767  $160,876
   Interest on taxable
    investment securities          4,306     4,252    17,741    19,195
   Interest on non-taxable
    investment securities            728       517     2,818     1,564
   Dividends on restricted
    equity investments               281       282     1,112     1,143
   Interest on federal funds
    sold                              86       494     1,725     1,172
                                --------  --------  --------  --------
     Total interest income        49,392    48,536   198,163   183,950
                                --------  --------  --------  --------
 INTEREST EXPENSE
   Interest on deposits           20,211    19,802    84,252    66,892
   Interest on borrowed funds      1,556     1,997     6,267     9,571
   Interest on junior
    subordinated debentures        1,787     2,192     8,468     8,409
                                --------  --------  --------  --------
     Total interest expense       23,554    23,991    98,987    84,872
                                --------  --------  --------  --------
     Net interest income          25,838    24,545    99,176    99,078

 PROVISION FOR LOAN LOSSES         5,443       990     8,403     3,807
                                --------  --------  --------  --------
   Net interest income after
    provision for loan losses     20,395    23,555    90,773    95,271
                                --------  --------  --------  --------
 NON-INTEREST INCOME
   Service charges on deposit
    accounts                       3,421     3,183    13,687    11,117
   Other service charges              85        73       307       311
   Net gain on sale of
    branches                          --        --     1,443        --
   (Loss) gain on sale of
    bank property & equipment         --      (330)       12      (330)
   Loss on sale of investment
    securities                        --        (1)       --       (21)
   Gain on sale of loans             342       463     1,689     1,127
   Net gain on derivative
    instruments                      511       200     1,567     1,178
   Other                           2,123     1,424     7,110     6,364
                                --------  --------  --------  --------
     Total non-interest income     6,482     5,012    25,815    19,746
                                --------  --------  --------  --------
 NON-INTEREST EXPENSE
   Salaries and employee
    benefits                      11,004    10,842    45,432    45,079
   Occupancy expense               2,830     3,361    11,491    12,136
   Equipment expense               1,660     1,970     7,172     7,926
   Amortization of intangible
    expenses                       1,177     1,193     4,714     4,767
   Data processing expense         1,078       895     4,249     4,283
   Advertising expense               459       407     1,856     1,683
   Other                           3,320     3,221    14,049    13,519
                                --------  --------  --------  --------
     Total non-interest expense   21,528    21,889    88,963    89,393
                                --------  --------  --------  --------
 INCOME BEFORE INCOME TAXES        5,349     6,678    27,625    25,624
 INCOME TAXES                      1,479     2,224     8,273     8,350
                                --------  --------  --------  --------
 NET INCOME                     $  3,870  $  4,454  $ 19,352  $ 17,274
                                ========  ========  ========  ========

 Basic earnings per share (1)   $   0.18  $   0.21  $   0.89  $   0.81
                                ========  ========  ========  ========
 Diluted earnings per share (1) $   0.17  $   0.20  $   0.86  $   0.77
                                ========  ========  ========  ========

 (1) Data is adjusted for a 5% stock dividend declared in April 2007.


 SUN BANCORP, INC. AND SUBSIDIARIES
 HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (unaudited)
 (Dollars in thousands)

                   2007        2007       2007       2007       2006
                    Q4          Q3         Q2         Q1         Q4
                ---------- ---------- ---------- ---------- ----------
 Balance sheet
  at quarter
  end:
   Loans:
    Commercial
     and
     industrial $2,024,728 $1,990,027 $1,985,584 $1,972,491 $1,925,103
    Home equity    264,965    258,991    245,283    234,982    232,321
    Second
     mortgage       81,063     79,464     79,120     76,449     77,337
    Residential
     real
     estate         49,750     54,601     47,101     38,798     38,418
    Other           89,413     91,094     91,618     93,149     93,444
                ---------- ---------- ---------- ---------- ----------
     Total
      gross
      loans      2,509,919  2,474,177  2,448,706  2,415,869  2,366,623
   Allowance
    for loan
    losses         (27,002)   (26,340)   (26,079)   (26,027)   (25,658)
                ---------- ---------- ---------- ---------- ----------
     Net
      loans      2,482,917  2,447,837  2,422,627  2,389,842  2,340,965
   Goodwill        127,894    127,935    127,936    127,936    128,117
   Intangible
    assets, net     23,479     24,656     25,833     27,011     28,570
   Total assets  3,338,392  3,295,576  3,324,633  3,326,681  3,325,563
   Total
    deposits     2,699,091  2,682,286  2,725,747  2,694,304  2,667,997
   Advances from
    the Federal
    Home Loan
    Bank (FHLB)     63,483     64,763     66,029    100,481    103,560
   Federal funds
    purchased       30,000         --         --      1,500         --
   Securities
    sold under
    agreements
    to re-
    purchase -
    FHLB            15,000     15,000         --         --         --
   Securities
    sold under
    agreements
    to re-
    purchase -
    customers       40,472     46,499     44,612     42,511     51,740
   Obligation
    under
    capital
    lease            5,258      5,275      5,291      5,307      5,322
   Junior
    subordinated
    debentures      97,941     97,941     97,941    108,250    108,250
   Total
    shareholders'
    equity         362,177    361,645    355,758    348,595    342,227
 Quarterly
  average
  balance sheet:
   Loans:
     Commercial
      and
      in-
      dustrial  $2,030,928 $1,981,778 $1,978,175 $1,956,190 $1,937,580
     Home equity   263,245    250,474    240,150    233,837    229,002
     Second
      mortgage      80,400     78,643     77,442     76,167     77,593
     Residential
      real
      estate        50,734     49,635     39,193     37,710     35,323
     Other          87,155     89,566     91,578     92,705     90,358
                ---------- ---------- ---------- ---------- ----------
      Total
       gross
       loans     2,512,462  2,450,096  2,426,538  2,396,609  2,369,856
   Securities
    and other
    interest-
    earning
    assets         468,418    509,016    577,669    560,574    578,983
   Total
    interest-
    earning
    assets       2,980,880  2,959,112  3,004,207  2,957,183  2,948,839
   Total assets  3,322,686  3,292,687  3,341,506  3,302,913  3,288,123
   Non-interest-
    bearing
    demand
    deposits       434,066    462,173    458,851    458,201    480,339
   Total
    deposits     2,689,326  2,682,879  2,724,554  2,664,668  2,648,713
   Total
    interest-
    bearing
    liabilities  2,499,003  2,445,187  2,501,896  2,466,678  2,445,320
   Total
    shareholders'
    equity         363,302    359,949    353,280    344,717    339,839

 Capital and
  credit
  quality
  measures:
   Total Capital
   (to Risk-
   Weighted
   Assets)(1):
    Sun Bancorp,
     Inc.            11.93%     11.97%     11.80%     11.98%     11.89%
    Sun National
    Bank             11.08%     11.06%     10.74%     10.64%     10.57%
   Tier I
    Capital (to
    Risk-
    Weighted
    Assets)(1):
    Sun Bancorp,
     Inc.            10.95%     10.99%     10.83%     11.00%     10.91%
    Sun National
     Bank            10.11%     10.05%      9.77%      9.66%      9.59%
   Leverage Ratio
    (1):
    Sun Bancorp,
     Inc.             9.67%      9.80%      9.46%      9.58%      9.40%
    Sun National
     Bank             8.98%      8.95%      8.54%      8.42%      8.28%

   Average
    equity to
    average
    assets           10.93%     10.93%     10.57%     10.44%     10.34%
   Allowance for
    loan losses
    to total
    gross loans       1.08%      1.06%      1.07%      1.08%      1.08%
   Non-
    performing
    assets to
    total gross
    loans and
    real estate
    owned             1.18%      0.90%      0.67%      0.63%      0.64%
   Allowance for
    loan losses
    to non-
    performing
    loans            95.77%    127.11%    169.98%    177.14%    175.50%

  Other data:
    Net
     charge-
     offs        $  (4,781) $    (999) $    (898) $    (381) $  (1,117)
                 =========  =========  =========  =========  =========
    Non-
     performing
     assets:
      Non-
       accrual
       loans     $  26,853  $  18,157  $  14,505  $  14,147  $  14,322
      Loans past
       due 90
       days and
       accruing      1,343      2,565        837        546        298
      Real
       estate
       owned,
       net           1,449      1,449      1,165        600        600
                 ---------  ---------  ---------  ---------  ---------
       Total
        non-
        per-
        forming
        assets   $  29,645  $  22,171  $  16,507  $  15,293  $  15,220
                 =========  =========  =========  =========  =========

 (1) December 31, 2007 capital ratios are estimated, subject to
     regulatory filings.


 SUN BANCORP, INC. AND SUBSIDIARIES
 HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (unaudited)
 (Dollars in thousands, except per share data)

                    2007       2007       2007       2007       2006
                     Q4         Q3         Q2         Q1         Q4
                  --------   --------   --------   --------   --------
 Profitability
  for the
  quarter:
   Tax-
    equivalent
    interest
    income        $ 49,783   $ 50,406   $ 50,049   $ 49,441   $ 48,807
   Interest
    expense         23,554     24,567     26,108     24,758     23,991
     Tax-
      equivalent
      net
      interest
      income        26,229     25,839     23,941     24,683     24,816
     Tax-
      equivalent
      adjustment       391        384        391        350        271
   Provision for
    loan losses      5,443      1,260        950        750        990
   Non-interest
    income,
    excluding
    loss on sale
    of
    investment
    securities,
    net gain on
    sale of
    branches and
    net gain
    (loss) on
    sale or
    disposal of
    bank
    property and
    equipment        6,482      6,011      6,293      5,574      5,343
   Loss on sale
    of
    investment
    securities          --         --         --         --         (1)
   Net gain on
    sale of
    branches            --         --         --      1,443         --
   Net gain
    (loss) on
    sale or
    disposal of
    bank
    property &
    equipment           --         --         12         --       (330)
   Non-interest
    expense,
    excluding
    amortization
    of
    intangible
    assets          20,351     20,669     20,840     22,389     20,696
   Amortization
    of
    intangible
    assets           1,177      1,177      1,178      1,182      1,193
   Income before
    income taxes     5,349      8,360      6,887      7,029      6,678
   Income tax
    expense          1,479      2,475      1,975      2,344      2,224
   Net income     $  3,870   $  5,885   $  4,912   $  4,685   $  4,454
                  ========   ========   ========   ========   ========
 Financial
  ratios:
   Return on
    average
    assets(1)         0.47%      0.71%      0.59%      0.57%      0.54%
   Return on
    average
    equity(1)         4.26%      6.54%      5.56%      5.44%      5.24%
   Return on
    average
    tangible
    equity(1),(2)     7.33%     11.39%      9.88%      9.93%      9.78%
   Net interest
    margin(1)         3.52%      3.49%      3.19%      3.34%      3.37%
   Efficiency
    ratio            66.61%     69.43%     73.75%     75.19%     74.06%
   Efficiency
    ratio,
    excluding
    non-operating
    income and
    non-
    operating
    expense          66.61%     68.30%     71.77%     71.07%     70.78%
   Per share
    date:
     Earnings
      per common
      share(3):
       Basic      $   0.18   $   0.27   $   0.23   $   0.22   $   0.21
       Diluted    $   0.17   $   0.26   $   0.22   $   0.21   $   0.20
     Book value   $  16.68   $  16.48   $  16.21   $  16.16   $  15.89
     Tangible
      book value  $   9.71   $   9.53   $   9.21   $   8.98   $   8.62

 Average basic
 shares         21,825,667 22,045,407 21,738,367 21,547,912 21,504,499
 Average diluted
  shares        22,435,324 22,735,620 22,670,769 22,596,591 22,602,237
 Operating non-
  interest
  income:
   Service
    charges on
    deposit
    accounts      $  3,421   $  3,585   $  3,552   $  3,129   $  3,183
   Other service
    charges             85         75         75         72         73
   Gain on sale
    of loans           342        392        447        508        463
   Net gain on
    derivative
    instruments        511        297        525        234        200
   Other             2,123      1,662      1,694      1,631      1,424
                  --------   --------   --------   --------   --------
     Total
      operating
      non-
      interest
      income         6,482      6,011      6,293      5,574      5,343
                  --------   --------   --------   --------   --------
 Non-operating
  income(4):
   Loss on sale
    of
    investment
    securities          --         --         --         --         (1)
   Net gain on
    sale of
    branches            --         --         --      1,443         --
   Net gain
    (loss) on
    sale or
    disposal of
    bank
    property &
    equipment           --         --         12         --       (330)
                  --------   --------   --------   --------   --------
     Total non-
     operating
     income             --         --         12      1,443       (331)
                  --------   --------   --------   --------   --------
     Total non-
     interest
     income       $  6,482   $  6,011   $  6,305   $  7,017   $  5,012
                  ========   ========   ========   ========   =========
 Operating non-
  interest
  expense:
   Salaries and
    employee
    benefits      $ 11,004   $ 10,816   $ 10,937   $ 10,626   $ 10,602
   Occupancy
    expense          2,830      2,773      2,717      3,012      2,876
   Equipment
    expense          1,660      1,732      1,829      1,951      1,960
   Amortization
    of
    intangible
    assets           1,177      1,177      1,178      1,182      1,193
   Data
    processing
    expense          1,078      1,063      1,100      1,008        895
   Advertising
    expense            459        415        509        473        407
   Other
    expenses         3,320      3,685      3,538      3,002      3,221
                  --------   --------   --------   --------   --------
     Total
      operating
      non-
      interest
      expense       21,528     21,661     21,808     21,254     21,154
                  --------   --------   --------   --------   --------
 Non-operating
  expense(4):
   Lease buy-out
    expenses and
    other branch
    rational-
    ization
    charges             --        185         --         --        495
   Severance and
    other
    related
    expenses            --         --         86      2,317        240
   Early
    extinguish-
    ment of
    borrowings          --         --        124         --         --
                  --------   --------   --------   --------   --------
     Total non-
      operating
      expense           --        185        210      2,317        735
                  --------   --------   --------   --------   --------
     Total non-
     interest
     expense      $ 21,528   $ 21,846   $ 22,018   $ 23,571   $ 21,889
                  ========   ========   ========   ========   =========

 (1) Amounts are annualized.

 (2) Return on  average  tangible  equity  is  computed  by  dividing
     annualized net income for the period by average tangible equity.
     Average  tangible  equity  equals  average  equity less  average
     identifiable intangible assets and goodwill.

 (3) Data is adjusted for a 5% stock dividend declared in April 2007.

 (4) Amount consists of items which the Company believes are not a
     result of normal operations.


 SUN BANCORP, INC. AND SUBSIDIARIES
 AVERAGE BALANCE SHEETS (unaudited)
 (Dollars in thousands)
                                        For the Three Months Ended
                                            December 31, 2007
                                   -----------------------------------
                                    Average     Income/     Yield/
                                    Balance     Expense      Cost
                                   ----------   --------    ------
 Interest-earning assets:
    Loans receivable(1),(2):
     Commercial and industrial     $2,030,928   $ 35,943      7.08%
     Home equity                      263,245      4,177      6.35
     Second mortgage                   80,400      1,343      6.68
     Residential real estate           50,734        881      6.95
     Other                             87,155      1,647      7.56
                                   ----------   --------
      Total loans receivable        2,512,462     43,991      7.00
    Investment securities(3)          451,493      5,605      4.97
    Interest-earning bank balances      9,911        101      4.08
    Federal funds sold                  7,014         86      4.90
                                   ----------   --------
      Total interest-earning
        assets                      2,980,880     49,783      6.68
                                   ----------   --------
 Cash and due from banks               64,168
 Bank properties and
  equipment, net                       45,983
 Goodwill and intangible
  assets, net                         152,147
 Other assets                          79,508
                                   ----------
      Total non-interest-earning
       assets                         341,806
                                   ==========
      Total assets                 $3,322,686
                                   ==========

 Interest-bearing liabilities:
   Interest-bearing deposit
    accounts:
     Interest-bearing demand
      deposits                     $  788,548      4,838      2.45%
     Savings deposits                 446,530      3,104      2.78
     Time deposits                  1,020,182     12,269      4.81
                                   ----------   --------
      Total interest-bearing
       deposit accounts             2,255,260     20,211      3.58
                                   ----------   --------
   Borrowed money:
    Federal funds purchased             8,707        112      5.15
    Securities sold under
     agreements to repurchase -
     customers                         46,656        466      4.00
    FHLB advances                      85,175        881      4.14
    Junior subordinated debentures     97,941      1,787      7.30
    Obligation under capital lease      5,264         97      7.37
                                   ----------   --------
      Total borrowings                243,743      3,343      5.49
                                   ----------   --------
      Total interest-bearing
       liabilities                  2,499,003     23,554      3.77
                                   ----------   --------
 Non-interest-bearing demand
  deposits                            434,066
 Other liabilities                     26,315
                                   ----------
      Total non-interest-bearing
       liabilities                    460,381
                                   ----------
      Total liabilities             2,959,384
 Shareholders' equity                 363,302
                                   ----------
      Total liabilities and
       shareholders' equity        $3,322,686
                                   ==========
 Net interest income                            $ 26,229
                                                ========
 Interest rate spread(4)                                      2.91%
                                                            ======
 Net interest margin(5)                                       3.52%
                                                            ======
 Ratio of average interest-
  earning assets to average
  interest-bearing liabilities                              119.28%
                                                            ======

                                      For the Three Months Ended
                                           December 31, 2006
                                   -------------------------------
                                    Average     Income/     Yield/
                                    Balance     Expense      Cost
                                   ----------   --------    ------
 Interest-earning assets:
   Loans receivable(1),(2):
     Commercial and industrial     $1,937,580   $ 35,379      7.30%
     Home equity                      229,002      3,823      6.68
     Second mortgage                   77,593      1,238      6.38
     Residential real estate           35,323        687      7.78
     Other                             90,358      1,864      8.25
                                   ----------   --------
      Total loans receivable        2,369,856     42,991      7.26
   Investment securities(3)           514,588      4,997      3.88
   Interest-earning bank balances      26,924        325      4.83
   Federal funds sold                  37,471        494      5.27
                                   ----------   --------
      Total interest-earning
        assets                      2,948,839     48,807      6.62
                                   ----------   --------
 Cash and due from banks               79,150
 Bank properties and
  equipment, net                       42,457
 Goodwill and intangible
  assets, net                         157,707
 Other assets                          59,970
                                   ----------
      Total non-interest-earning
       assets                         339,284
                                   ----------
      Total assets                 $3,288,123
                                   ==========
 Interest-bearing liabilities:
   Interest-bearing deposit
    accounts:
     Interest-bearing demand
      deposits                     $  810,677   $  6,372      3.14%
     Savings deposits                 394,878      2,419      2.45
     Time deposits                    962,819     11,011      4.57
                                   ----------   --------
      Total interest-bearing
       deposit accounts             2,168,374     19,802      3.65
                                   ----------   --------
  Borrowed money:
   Federal funds purchased                152          2      5.26
   Securities sold under
    agreements to repurchase -
    customers                          55,757        642      4.61
   FHLB advances                      107,460      1,255      4.67
   Junior subordinated debentures     108,250      2,192      8.10
   Obligation under capital lease       5,327         98      7.36
                                   ----------   --------
      Total borrowings                276,946      4,189      6.05
                                   ----------   --------
      Total interest-bearing
       liabilities                  2,445,320     23,991      3.92
                                   ----------   --------
 Non-interest-bearing demand
  deposits                            480,339
 Other liabilities                     22,625
                                   ----------
      Total non-interest-bearing
       liabilities                    502,964
                                   ----------
      Total liabilities             2,948,284
 Shareholders' equity                 339,839
                                   ----------
      Total liabilities and
       shareholders' equity        $3,288,123
                                   ==========
 Net interest income                            $ 24,816
                                                ========
 Interest rate spread(4)                                      2.70%
                                                            ======
 Net interest margin(5)                                       3.37%
                                                            ======
 Ratio of average interest-
  earning assets to average
  interest-bearing liabilities                              120.59%
                                                            ======
 (1) Average balances include non-accrual loans.

 (2) Loan fees are included in interest income and the amount is not
     material for this analysis.

 (3) Interest earned on non-taxable investment securities is shown on
     a tax equivalent basis assuming a 35% marginal federal tax rate
     for all periods.

 (4) Interest rate spread represents the difference between the
     average yield on interest-earning assets and the average cost of
     interest-bearing liabilities.

 (5) Net interest margin represents net interest income as a
     percentage of average interest-earning assets.

  SUN BANCORP, INC. AND SUBSIDIARIES
  AVERAGE BALANCE SHEETS (unaudited)
  (Dollars in thousands)
                                          For the Year Ended
                                           December 31, 2007
                                   -------------------------------
                                    Average     Income/     Yield/
                                    Balance     Expense      Cost
                                   ----------   --------    ------
 Interest-earning assets:
   Loans receivable(1),(2):
     Commercial and industrial     $1,986,959   $143,231      7.21%
     Home equity                      247,017     16,010      6.48
     Second mortgage                   78,176      5,060      6.47
     Residential real estate           44,368      3,362      7.58
     Other                             90,234      7,104      7.87
                                   ----------   --------
       Total loans receivable       2,446,754    174,767      7.14
   Investment securities(3)           481,775     22,514      4.67
   Interest-earning bank
    balances                           13,871        673      4.85
   Federal funds sold                  32,966      1,725      5.23
                                   ----------   --------
       Total interest-earning
        assets                      2,975,366    199,679      6.71
                                   ----------   --------
 Cash and due from banks               68,963
 Bank properties and equipment,
  net                                  44,014
 Goodwill and intangible assets,
  net                                 153,957
 Other assets                          72,641
                                   ----------
       Total non-interest-
        earning assets                339,575
                                   ----------
       Total assets                $3,314,941
                                   ----------

 Interest-bearing liabilities:
   Interest-bearing deposit
    accounts:
     Interest-bearing demand
      deposits                     $  759,855     22,130      2.91%
     Savings deposits                 455,096     13,214      2.90
     Time deposits                  1,022,172     48,908      4.78
                                   ----------   --------
        Total interest-bearing
         deposit accounts           2,237,123     84,252      3.77
                                   ----------   --------
   Borrowed money:
    Federal funds purchased             2,929        155      5.29
    Securities sold under
     agreements to
     repurchase - customers            44,213      1,961      4.44
    FHLB advances                      87,306      3,764      4.31
    Junior subordinated
     debentures                       101,330      8,468      8.36
    Obligation under capital
      lease                             5,288        387      7.32
                                   ----------   --------
        Total borrowings              241,066     14,735      6.11
                                   ----------   --------
        Total interest-bearing
         liabilities                2,478,189     98,987      3.99
                                   ----------   --------
 Non-interest-bearing demand
  deposits                            453,281
 Other liabilities                     28,095
                                   ----------
        Total non-interest-
         bearing liabilities          481,376
                                   ----------
        Total liabilities           2,959,565
 Shareholders' equity                 355,376
                                   ----------
        Total liabilities and
         shareholders' equity      $3,314,941
                                   ==========

 Net interest income                            $100,692
                                                ========
 Interest rate spread(4)                                      2.72%
                                                            =======
 Net interest margin(5)                                       3.38%
                                                           =======
 Ratio of average interest-
  earning assets to average
  interest-bearing liabilities                              120.06%
                                                           =======

                                           For the Year Ended
                                            December 31, 2006
                                   -----------------------------------
                                    Average     Income/     Yield/
                                    Balance     Expense      Cost
                                   ----------   --------    ------
 Interest-earning assets:
   Loans receivable(1),(2):
     Commercial and industrial     $1,880,475   $133,312      7.09%
     Home equity                      202,072     13,326      6.59
     Second mortgage                   74,184      4,642      6.26
     Residential real estate           30,264      2,460      8.13
     Other                             86,505      7,136      8.25
                                   ----------   --------
       Total loans receivable       2,273,500    160,876      7.08
   Investment securities(3)           595,474     22,032      3.70
   Interest-earning bank
    balances                           14,676        702      4.78
   Federal funds sold                  23,938      1,172      4.90
                                   ----------   --------
       Total interest-earning
        assets                      2,907,588    184,782      6.36
                                   ----------   --------
 Cash and due from banks               80,241
 Bank properties and equipment,
  net                                  43,099
 Goodwill and intangible assets,
  net                                 157,082
 Other assets                          57,321
                                   ----------
        Total non-interest-
         earning assets               337,743
                                   ----------
        Total assets                3,245,331
                                   ==========

 Interest-bearing liabilities:
   Interest-bearing deposit
    accounts:
     Interest-bearing demand
      deposits                     $  841,288     23,587      2.80%
     Savings deposits                 365,932      6,687      1.83
     Time deposits                    889,192     36,618      4.12
                                   ----------   --------
        Total interest-bearing
         deposit accounts           2,096,412     66,892      3.19
                                   ----------   --------
   Borrowed money:
    Federal funds purchased             4,277        231      5.40
    Securities sold under
     agreements to
     repurchase - customers            45,726      1,985      4.34
    FHLB advances                     147,017      6,833      4.65
    Junior subordinated
     debentures                       106,894      8,409      7.87
    Obligation under capital
     lease                              5,356        522      7.31
                                   ----------   --------
        Total borrowings              309,270     17,980      5.81
                                   ----------   --------
        Total interest-bearing
         liabilities                2,405,682     84,872      3.53
                                   ----------   --------
 Non-interest-bearing demand
  deposits                            494,488
 Other liabilities                     17,851
                                   ----------
        Total non-interest-
         bearing liabilities          512,339
                                   ----------
        Total liabilities           2,918,021
 Shareholders' equity                 327,310
                                   ----------
        Total liabilities and
         shareholders' equity      $3,245,331
                                   ==========

 Net interest income                            $ 99,910
                                                ========
 Interest rate spread(4)                                      2.83%
                                                            ======
 Net interest margin(5)                                       3.44%
                                                            ======
 Ratio of average interest-
  earning assets to average
  interest-bearing liabilities                              120.86%
                                                            ======

 (1) Average balances include non-accrual loans.
 
 (2) Loan fees are included in interest income and the amount is not
     material for this analysis.
 
 (3) Interest earned on non-taxable investment securities is shown on
     a tax equivalent basis assuming a 35% marginal federal tax rate
     for all periods.
 
 (4) Interest rate spread represents the difference between the
     average yield on interest-earning assets and the average cost of
     interest-bearing liabilities.
 
 (5) Net interest margin represents net interest income as a
     percentage of average interest-earning assets.
Sun Bancorp, Inc.
Dan Chila, EVP, Chief Financial Officer
(856) 691-7700