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First Bankshares, Inc., Parent of SuffolkFirst Bank, Reports Strong Tier 2 Capital of 15.19% After Recording a $444,000 Loss or 20 Cents per Share for Six Months Ending June 30, 2009.

Article Excerpt
Darrell G. Swanigan, President & CEO of First Bankshares, Inc. (NASDAQ:SUFB), parent of SuffolkFirst Bank (herein referred to as the Bank), headquartered in Suffolk, VA commented, "The current dilemma surrounding the economy has affected the performance of some commercial loans in the Bank's loan portfolio, primarily participation loans (loans purchased from other banks). Management's primary focus is to intently monitor the problem loans within the loan portfolio while focusing on maintaining a well capitalized bank. On June 30, 2009, the Bank's risk-based capital ratio stood at 15.19% compared to 14.51% on June 30, 2008. This represents a 68 basis point improvement in total risk-based capital which primarily was the result of a decline of approximately $3.8 million risk weighted assets from the previous period ended June 30, 2008. One of the regulatory requirements for a bank to be considered 'well capitalized' is having a total risk-based capital ratio of 10% or better. Management believes our current strong capital position will enable us to adequately manage future pressures on the loan portfolio while the proposed merger with Xenith Corporation will add additional capital that will establish the combined institutions as one of the strongest well capitalized banks in Virginia."

For three months ended June 30, 2009, the Company recorded a net operating loss of $718,415 or 32 cents per share compared to 3 cents per share net income or $78,745 for the same three month period ended June 30, 2008. Net operating results for the recent quarter ended June 30, 2009 were influenced primarily by expenses of $728,662 related to the proposed merger with Xenith Corporation which is subject to shareholder approval and is anticipated to close in the third quarter 2009, an expense provision to the Allowance for Loan and Lease Losses (ALLL) of $600,000, and a special FDIC insurance...

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