First Citizens Reports Earnings for Third Quarter 2001

October 22, 2001

RALEIGH, N.C.— First Citizens BancShares Inc. (Nasdaq: FCNCA) reports earnings, excluding nonrecurring items, of $20.7 million for the quarter ending Sept. 30, 2001, according to Lewis R. Holding, chairman of the board. This reflects an increase of 5.3 percent in earnings, excluding nonrecurring items, from the same period of 2000. The after-tax favorable impact of nonrecurring items recorded during the third quarter of 2000 totaled $13.7 million, consisting primarily of a gain on the sale of mortgage servicing rights.

Ignoring the impact of nonrecurring items, per share income from the third quarter of 2001 totaled $1.97 compared to $1.86 for the same period in 2000, an increase of 5.9 percent. Earnings for the third quarter 2001, excluding nonrecurring items, generated an annualized return on average assets of 0.72 percent compared to 0.77 percent during 2000 and an annualized return on average shareholders' equity of 9.56 percent for the third quarter of 2001 compared to 10.11 percent for the third quarter last year.

Holding attributed the growth in third quarter net income, excluding nonrecurring items, to increases in core components of noninterest income, including a 19.6 percent increase in service charge income, a 19.5 percent increase in commission-based income and a 15.3 percent increase in credit card income. Net interest income increased only 0.8 percent during the third quarter, the result of lower market interest rates and a reduction in the loan-to-deposit ratio. Average deposits increased $971.8 million or 11.4 percent from the third quarter of 2000 to the third quarter of 2001, while average loans increased only $17.6 million or 0.3 percent. As a result of the liquidity generated by the favorable rate of deposit growth, average investment securities increased $561.4 million or 34.4 percent over 2000.

These increases were partially offset by a 5.6 percent increase in noninterest expense and a 33.9 percent increase in the provision for loan losses. Total noninterest expense increased $5.7 million during the third quarter of 2001 when compared to the same period of 2000. Salaries and wages increased $2.9 million during the third quarter of 2001, an increase of 6.6 percent, while employee benefits expenses increased $1.3 million or 16.3 percent, the result of higher pension and health insurance costs. The provision for loan losses increased $1.4 million during the third quarter of 2001 compared to the same period of 2000, the result of a softening economy. Despite a deteriorating economic climate, the ratio of net charge-offs to average loans amounted to only 0.27 percent.

Ignoring the impact of nonrecurring items, net income for the nine months that ended Sept. 30, 2001, was $61.1 million, an increase of 1.3 percent from the $60.3 million recorded during the first nine months of 2000. Per share income, excluding nonrecurring items, amounted to $5.81 for the nine-month period that ended Sept. 30, 2001, compared to $5.71 for 2000.

Holding noted a general reduction in interest rate spreads during the nine months that ended Sept. 30, 2001, when compared to 2000 and higher loan loss provisions. Net interest income increased $3.2 million or 1.2 percent while the provision for loan losses increased $6.1 million or 57.0 percent. Contributing favorably to earnings trends was the $23.0 million or 17.7 percent increase in noninterest income, excluding nonrecurring items. Service charges, mortgage revenues, commission-based income and credit card income contributed to the growth in noninterest income. Noninterest expense increased $20.2 million or 6.8 percent, the result of higher personnel and equipment costs.

As of Sept. 30, 2001, First Citizens had total assets of $11.52 billion. Two of BancShares' major subsidiaries are First Citizens Bank with 355 branches in North Carolina, Virginia and West Virginia, and Atlantic States Bank with 44 branches in Georgia and Florida. For more information, visit the First Citizens web site at firstcitizens.com.

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CONDENSED STATEMENTS OF INCOME
(thousand, except share data; unaudited)	Three Months Ended September 30 2001	2000	Nine Months Ended September 30 2001	2000
Interest Income	$176,709	$182,966	$548,395	$518,842
Interest expense	84,482	91,509	272,397	246,074
Net interest Income	92,227	91,457	275,998	272,768
Provision for loan losses	5,620	4,197	16,690	10,631
Net interest income after provision for loan losses	86,607	87,260	259,308	262,137
Noninterest Income	53,089	67,358	160,541	152,806
Noninterest expense	106,963	101,257	315,685	295,497
Income before income taxes	32,733	53,361	104,164	119,446
Income taxes	11,977	20,006	38,545	45,123
Net Income	$20,756	$33,355	$65,619	$74,323
Net Income excluding nonrecurring items	$20,661	$19,626	$61,091	$60,287
Taxable-equivalent net interest income	$92,698	$92,162	$277,468	$274,950
Net income per share	1.98	3.17	6.24	7.04
Net income per share excluding nonrecurring items	1.97	1.86	5.81	5.71
Cash dividends per share	0.25	0.25	0.75	0.75
Profitability Information (annualized)
Return on average assets	0.74%	1.31%	0.79%	1.01%
Return on average equity	9.82	17.22	10.47	13.21
Taxable-equivalent net yield on interest-earning assets	3.63	4.01	3.75	4.14
1 Noninterest income includes nonrecurring items of $150; $21,963; $7,188 and $22,455, respectively;

CONDENSED BALANCE SHEETS
(thousand, except share data; unaudited)	September 30 2001	December 31 2000	September 30 2000
Cash and due from banks	$691,594	$755,930	$529,897
Investment securities	2,482,123	1,816,720	1,730,439
Loans	7,109,584	7,109,692	7,097,773
Reserve for loan losses	(105,775)	(102,655)	(101,565)
Other assets	1,344,999	1,111,930	1,104,752
Total assets	$11,522,525	$10,691,617	$10,361,296
Deposits	$9,645,226	$8,971,868	$8,668,642
Other liabilities	1,011,336	909,021	903,313
Shareholder's equity	865,963	810,728	789,341
Total liabilities and shareholder's equity	$11,522,525	$10,691,617	$10,361,296
Book value per shared	$82.55	$77.04	$74.93
Tangible book value per share	71.64	65.76	64.77

SELECTED AVERAGE BALANCES
(thousand, except shares outstanding; unaudited)	Three Months Ended September 30 2001	2000	nine Months Ended September 30 2001	2000
Total assets	$11,333,123	$10,167,665	$11,083,960	$9,866,386
Investment securities	2,195,064	1,633,653	2,032,072	1,575,286
Loans	7,054,247	7,036,622	7,098,197	6,914,735
Interest-earning assets	10,126,568	9,142,585	9,900,481	8,867,141
Deposits	9,496,699	8,524,930	9,291,841	8,289,283
Interest-bearing liabilities	8,851,916	7,886,410	8,683,102	7,654,004
Shareholder's equity	$857,296	$770,418	$841,845	$751,643
Shares Outstanding	10,508,330	10,534,049	10,513,488	10,559,305

ASSET QUALITY
(dollars in thousand, unaudited)	September 30 2001	December 31 2000	September 30 2000
Nonaccrual loans	$13,349	$15,933	$13,918
Other real estate	4,242	1,880	2,079
Total nonperforming assets	$17,591	$17,813	$15,997
Accuring loans 90 days or more past due	$14,993	$6,731	$6,866
Nonperforming assets to gross loans plus other real estate	0.25%	0.25%	0.23%
Reserve for loan losses to gross loans	1.49	1.44	1.43
Net charge-offs to average total loans (annualized)	0.24	0.17	0.15

CAPITAL INFORMATION
(dollars in thousands, unaudited)	September 30 2001	December 31 2000	September 30 2000
Tier 1 capital	$894,881	$835,678	$826,825
Total capital	994,965	940,260	930,121
Risk-weighted assets	7,642,325	8,057,478	7,989,258
Tier 1 capital ratio	11.71%	10.37%	10.35%
Total capital ratio	13.02	11.67	11.64
Leverage capital ratio	7.98	8.11	8.22
First Citizens BancShares, Inc. and Subsidiaries

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