- Second quarter 2008 earnings per share: $0.08

- Assets up 23%: $3.0 billion vs. $2.5 billion

- Loans up 25%: $2.2 billion vs. $1.7 billion

- Deposits up 16%: $2.2 billion vs. $1.9 billion

- Net interest income up 22%: $21 million vs. $18 million

- Stockholder's equity up 25%: $349 million vs. $279 million

BIRMINGHAM, Ala., July 28 /PRNewswire-FirstCall/ -- Superior Bancorp (Nasdaq: SUPR) announced today its second quarter 2008 performance. A summary of its results is provided below and in the attached selected financial data.

                                                       As of and for the
                                                        Quarters Ended
    (Dollars in thousands, except               June 30, 2008   June 30, 2007
     per share data)
    Total assets                                  $3,039,558      $2,470,293
    Total loans, net of unearned income            2,148,751       1,719,808
    Total deposits                                 2,194,107       1,884,405
    Stockholders' equity                             348,785         278,953
    Net interest income                               21,388          17,513
    Net income                                           841           1,969
    Net income per common share (1)                     0.08            0.23
    Total branches                                        75              63

    (1) Retroactively restated to reflect 1-for-4 reverse stock split
        effective April 28, 2008.

CEO Stan Bailey stated, 'Our second quarter performance is in line with management's expectations given the current volatile environment of our economy, stock market and housing. Superior continues to focus on managing through the current credit cycle, growing our balance sheet with existing and new customers, remaining 'well capitalized' and making money. We have also completed our 20-branch de novo branch expansion program.'

Bailey added, 'Superior is open for business while many of our competitors are being integrated into Canadian and Spanish banks, or battling with billions of dollars in bad loans. We feel that our markets are recognizing our efforts to continue to serve their needs on a daily basis.'

Second Quarter 2008 Performance

Second quarter 2008 net income was $841,000, or $.08 per share, compared to $695,000 for the first quarter of 2008 and $2.0 million for the second quarter of 2007. Second quarter 2008 net income includes the effect of $1.3 million, net of tax, in new branch overhead expense and $564,000, net of tax, in core deposit intangible amortization compared to second quarter 2007 core deposit amortization of $192,000, net of tax. Second quarter 2007 results do not include the effect of Superior Bancorp's acquisition of People's Community Bancshares, Inc., which was completed on July 27, 2007.

Superior Bancorp's second quarter 2008 net interest income increased to $21.4 million, or 16% from $18.5 million for the first quarter of 2008 and 22% from $17.5 million for the second quarter of 2007. Net interest margin increased to 3.39% compared to 3.04% for the first quarter of 2008.

Superior Bancorp's second quarter 2008 core noninterest income increased to $5.4 million, or 6% from $5.1 million in the first quarter of 2008. This increase is primarily attributable to increases in customer service charges and brokerage commissions due in large part to an increased customer base resulting from our acquisitions and branch expansion. Core noninterest income excludes certain items such as investment security gains and losses and gains on extinguishment of approximately $5.7 million in liabilities related to deferred compensation and benefits. A reconciliation of core noninterest income is included in the attached selected financial data.

Superior Bancorp's second quarter of 2008 core noninterest expense increased to $22.2 million, or 4% from $21.1 million in the first quarter of 2008. This increase is primarily attributable to increases in advertising and marketing expenses and FDIC insurance assessments. Advertising and marketing expenses increased in certain markets affected by recent bank merger activities in an effort to take advantage of customer dislocation. These costs are expected to continue into the third quarter of 2008. Core noninterest expense excludes certain items such as amortization of core deposit intangibles. A reconciliation of core noninterest expense is included in the attached selected financial data.

Balance Sheet Growth

Superior Bancorp's total deposits at June 30, 2008 remained level at $2.2 billion from March 31, 2008 and December 31, 2007. Total deposits increased 16% from June 30, 2007. The acquisition of People's Community Bancshares, Inc. accounted for approximately 13% of the 16% deposit growth since June 30, 2007. As of June 30, 2008 Superior Bancorp's de novo branches accounted for approximately $223 million of core deposits, predominantly from new customer relationships. Customer dislocation resulting from recent merger activities in Superior's markets also contributed to the deposit performance.

Loans increased to $2.2 billion at June 30, 2008, an increase of 6.5% from December 31, 2007 and 24.9% from June 30, 2007. Loan growth occurred across all of Superior's Alabama and Florida markets, with primary expansion occurring in the commercial, mortgage and commercial real estate sectors of our loan portfolio. In addition, Superior Bank purchased a pool of residential mortgage loans with a balance of approximately $52 million during the second quarter of 2008.

Credit Quality Management

With regard to credit quality at June 30, 2008, non-performing loans ('NPLs') were 1.83% of total loans compared to 1.49% at March 31, 2008 and 1.26% at December 31, 2007, which is in line with management's expectations. The $8.4 million NPL increase during the second quarter of 2008 was predominantly located in Florida and includes real estate relationships primarily secured by residential properties in various stages of development.

Other Real Estate Owned ('OREO') increased $5.8 million during the second quarter of 2008 to $12.6 million. The increase in OREO is composed primarily of properties in Alabama consisting of single-family homes and residential lots. Of total OREO, $10.3 million is located in Alabama and $2.3 is in Florida.

Overall past due loans increased during the second quarter with the 90 days past due (DPD) and still accruing category moving to 0.09% at June 30, 2008 from 0.00% and 0.10% as a percentage of total loans at March 31, 2008 and December 31, 2007, respectively. Loans in the 30-89 DPD category increased to 2.05% from 1.25% and 1.13% as a percentage of total loans at March 31, 2008 and December 31, 2007, respectively.

Net loan charge-offs as a percentage of average loans were 0.38% during the second quarter of 2008, compared to 0.29% and 0.33% during the first quarter of 2008 and fourth quarter of 2007, respectively. Of the $2.0 million net charge-offs in the second quarter of 2008, Superior Bank's charge-offs were $1.5 million or 0.28% of average loans and the consumer finance company charge-offs were $490,000 or 0.10% of average loans. Of Superior Bank's charge-offs, 56% related to 1-4 family mortgages and 42% related to real estate construction.

The provision for loan losses was $6.0 million in the second quarter of 2008, increasing the allowance for loan losses to 1.27% of net loans, or $27.2 million, at June 30, 2008, compared to 1.13% of net loans, or $23.3 million at March 31, 2008. Superior's management believes the allowance for loan losses at June 30, 2008 appropriately reflects management's best estimate of potential losses in the loan portfolio. Management's assessment of Superior's credit quality is based on various internal and external factors that affect the collectability of loans.

De Novo Branching Program Completed

In furtherance of Superior's de novo branch strategy, the company has opened all of the 20 planned new branches since September 2006 in key Alabama and Florida markets, representing approximately $223 million of core deposits as of June 30, 2008. For the second quarter of 2008, after-tax overhead expense associated with the new branches was $1.3 million, representing an approximately 2% annualized premium on deposits. Superior Bancorp has invested approximately $25 to $30 million toward its de novo branch expansion program.

Well Capitalized and Liquid

Superior Bank continues to be categorized as 'well capitalized' under regulatory guidelines with a total risk-based capital ratio of 10.22% as of June 30, 2008. Other key equity ratios of Superior Bank at June 30, 2008 were total equity to total assets of 13.08% and tangible equity to tangible assets of 7.40%.

Short-term liquid assets (cash and due from banks, interest-bearing deposits in other banks and federal funds sold) increased $16.0 million, or 25.2%, to $79.3 million at June 30, 2008 from $63.3 million at December 31, 2007. At June 30, 2008, short-term liquid assets comprised 2.6% of total assets, compared to 2.2% at December 31, 2007.