First Citizens Reports Earnings for Third Quarter 2000

October 23, 2000

RALEIGH, N.C. - First Citizens BancShares Inc. (Nasdaq: FCNCA) reports earnings for the quarter ending Sept. 30, 2000, of $33.4 million compared to $23.1 million for the corresponding period of 1999, an increase of 44.2 percent, according to Lewis R. Holding, chairman of the board.

The increase in net income is primarily attributed to several nonrecurring items, including a $12.6 million after-tax gain on the sale of mortgage servicing. Other nonrecurring items during the third quarter of 2000 include a $1.1 million after-tax securities gain and a $1.3 million after-tax loss related to branch closings. During the third quarter of 1999, BancShares recorded after-tax gains of $2.8 million on the sale of branch offices. Excluding the impact of the nonrecurring items during both periods, net income for the third quarter of 2000 would have been $20.9 million, compared to $20.3 million during 1999, an increase of 2.5 percent.

Per share income for the third quarter 2000 totaled $3.17 compared to $2.18 for the same period a year ago. First Citizens' current quarter results generated an annualized return on average assets of 1.31 percent and a return on average equity of 17.22 percent. Adjusting for the impact of the servicing gain and other nonrecurring items, net income per share was $1.98 during the third quarter of 2000, compared to adjusted net income of $1.92 per share during the same period of 1999.

For the nine months ending Sept. 30, 2000, net income was $74.3 million, up 18.9 percent from $62.5 million in 1999. Net income per share was $7.04, compared to $5.88 per share in 1999, an increase of 19.7 percent. The year-to-date earnings yielded an annualized return on assets of 1.01 percent and a return on equity of 13.21 percent. When adjusted for the impact of nonrecurring items, net income was $62.0 million for 2000 and $59.7 million for 1999, a 3.9 percent increase. Adjusted net income per share was $5.87 for 2000 and $5.62 for 1999.

In addition to the nonrecurring gains recorded during 2000, Holding attributed the higher net income during 2000 to improvements both in net interest income and non interest income compared to 1999. Year-to-date net interest income increased 3.5 percent due to balance sheet growth and an improved net yield on interest earning assets. For the nine-month period ending Sept. 30, 2000, the net yield equaled 4.14 percent, up four basis points from the same period in 1999.

Although net interest income improved for 2000 when compared to 1999, Holding noted that net interest income during the third quarter was $91.5 million, a slight reduction from second quarter 2000, despite growth in interest-earning assets. Funding costs increased from 4.27 percent for interest-bearing liabilities during the second quarter to 4.62 percent during the third quarter. This caused the net yield on earning assets to decrease from 4.23 percent during the second quarter to 4.01 percent during the third quarter.

The provision for loan losses during the third quarter of 2000 was $4.2 million, compared to $3.3 million during the third quarter of 1999. The 26.1 percent increase results from higher levels of charge-offs. Net charge-offs increased from $2.1 million during the third quarter of 1999 to $3.7 million during the third quarter of 2000. For the first nine months of 2000, the provision for loan losses totaled $10.6 million, compared to $8.2 million during the same period of 1999, an increase of 30.1 percent. Net charge-offs increased 22.7 percent during 2000, and continued loan growth required additional loan loss reserves. On an annualized basis, net charge-offs during 2000 represent 0.15 percent of loans outstanding, compared to 0.13 percent during the same period of 1999.

During the first nine months of 2000, non interest income was $152.8 million, compared to the $123.4 million during the same nine months in 1999, an increase of 23.9 percent. In addition to the results of the nonrecurring gains, non interest income benefited from core growth in service charge income and credit card fee income.

For the first nine months, non interest expense was $295.5 million and $279.7 million in 2000 and 1999, respectively. Higher personnel and occupancy costs resulting from continued branch expansion in Georgia and Florida contributed to much of the growth in non interest expenses in the third quarter of 2000.

As of Sept. 30, 2000, Raleigh, N.C.-based First Citizens had assets of $10.36 billion. Two of BancShares' major subsidiaries are First Citizens Bank with 367 branches in North Carolina, Virginia and West Virginia, and Atlantic States Bank with 32 branches in North Metro Atlanta and Southwest Florida. For more information, visit the First Citizens web site.

CONDENSED STATEMENTS OF INCOME
	Three Months Ended September 30		Nine Months Ended September 30
(thousand, except share data; unaudited)	2000	1999	2000	1999
Interest Income	$182,966	$160,224	$518,842	$472,640
Interest expense	91,509	70,497	246,074	209,031
Net interest Income	91,457	89,727	272,768	263,609
Provision for loan losses	4,197	3,329	10,631	8,169
Net interest income after provision for loan losses	87,260	86,398	262,137	255,440
Non interest Income	67,358	45,898	152,806	123,364
Noninterest expense	101,257	95,104	295,497	279,709
Income before income taxes	53,361	37,192	119,446	99,095
Income taxes	20,006	14,060	45,123	36,612
Net Income	$33,355	$23,132	$74,323	$62,483
Taxable-equivalent net interest income	$92,162	$90,258	$274,950	$265,299
Net income per share	$3.17	$2.18	$7.04	$5.88
Cash dividends per share	0.25	0.25	0.75	0.75
Profitability Information (annualized)
Return on average assets	1.31%	0.95%	1.01%	0.87%
Return on average equity	17.22	13.07	13.21	12.20
Taxable-equivalent net yield on interest-earning assets	4.01	4.12	4.14	4.10

CONDENSED BALANCE SHEETS
	September 30	December 31	September 30
(thousand, except share data; unaudited)	2000	1999	1999
Cash and due from banks	$529,897	$591,605	$461,792
Investment securities	1,730,439	1,371,894	1,699,520
Loans	7,097,773	6,751,039	6,574,807
Reserve for loan losses	(101,565)	(98,690)	(97,965)
Other assets	1,104,752	1,101,251	939,561
Total assets	$10,361,296	$9,717,099	$9,577,715
Deposits	$8,668,642	$8,173,598	$8,062,091
Other liabilities	903,313	814,744	802,555
Shareholder's equity	789,341	728,757	713,069
Total liabilities and shareholder's equity	$10,361,296	$9,717,099	$9,577,715
Book value per shared	$74.93	$68.68	$67.11
Tangible book value per share	64.77	58.13	56.31

SELECTED AVERAGE BALANCES
	Three Months Ended September 30		Nine Months Ended September 30
(thousand, except shares outstanding; unaudited)	2000	1999	2000	1999
Total assets	$10,167,662	$9,644,135	$9,866,386	$9,589,565
Investment securities	1,633,653	1,897,593	1,575,286	2,017,852
Loans	7,036,622	6,474,200	6,914,735	6,315,810
Interest-earning assets	9,142,585	8,689,146	8,867,141	8,642,421
Deposits	8,524,930	8,121,209	8,289,283	8,093,473
Interest-bearing liabilities	7,886,410	7,518,874	7,654,004	7,512,009
Shareholder's equity	$770,418	$702,065	$751,643	$684,687
Shares Outstanding	10,534,049	10,625,559	10,559,305	10,625,559

ASSET QUALITY
	September 30	December 31	September 30
(dollars in thousands, unaudited)	2000	1999	1999
Nonaccrual loans	$13,918	$10,720	$10,580
Other real estate	2,079	1,600	1,614
Total nonperforming assets	$15,997	$12,320	$12,194
Accruing loans 90 days or more past due	$6,866	$3,576	$7,350
Nonperforming assets to gross loans plus other real estate	0.23%	0.18%	0.19%
Reserve for loan losses to gross loans	1.43	1.46	1.49
Net charge-offs to average total loans (annualized, year-to-date)	0.15	0.14	0.13

CAPITAL INFORMATION
	September 30	December 31	September 30
(dollars in thousands, unaudited)	2000	1999	1999
Tier 1 capital	$826,825	$760,195	$741,424
Total capital	930,121	859,638	838,411
Risk-weighted assets	7,989,258	7,616,890	7,398,935
Tier 1 capital ratio	10.35%	9.98%	10.02%
Total capital ratio	11.64	11.29	11.33
Leverage capital ratio	8.22	7.91	7.80
First Citizens BancShare, Inc. and Subsidiaries

For more information, contact:
Barbara Thompson
First Citizens BancShares
(919) 716-2716