Colonial BancGroup to Acquire First Federal Savings Bank of Lake County

Colonial BancGroup to Acquire First Federal Savings Bank of Lake
County 


MONTGOMERY, Ala., Jan. 18  /PRNewswire-FirstCall/ -- Colonial BancGroup
Chairman and CEO Robert E. Lowder and FFLC Bancorp, Inc. CEO Stephen T. Kurtz
jointly announced today that the companies have entered into a definitive
agreement for Colonial BancGroup to acquire FFLC Bancorp, Inc. and its
subsidiary First Federal Savings Bank of Lake County.  The transaction
represents an aggregate consideration totaling approximately $232 million.
Under the terms of the agreement, FFLC shareholders will elect either 2.0
shares of Colonial stock or $42.00 in cash for each FFLC share they own. The
cash consideration will be capped at 35% of the transaction. An over-election
of cash will result in a pro rata distribution of stock. More details of the
transaction will be provided in a subsequent 8K filing.

First Federal Savings Bank of Lake County, headquartered in Leesburg, Florida
(Lake County), had total assets of $1 billion, total deposits of $795 million
and total loans of $884 million at December 31, 2004. First Federal currently
operates 16 full-service offices in Lake, Sumter, Citrus and Marion counties in
Central Florida.  Once completed, this transaction, coupled with Colonial's
pending acquisition of Union Bank of Florida (Broward County) will make
Colonial the fifth largest commercial bank in Florida with approximately $7.4
billion in deposits in Florida.

Lake County, part of the Orlando MSA, is projected to be the second fastest
growing large county (population over 200,000) in Florida over the next five
years.  This transaction should solidify Colonial's position as the fourth
largest bank in the Orlando MSA with approximately 7.5% deposit market share.
The transaction is expected to be accretive to earnings per share within one
year of closing. Colonial anticipates it will realize approximately $3.8
million in pre-tax cost savings, exclusive of any potential branch closures.

"Since 1996, we have deliberately increased our presence in states whose growth
patterns are more robust than our home state of Alabama. We have executed this
strategy with considerable success in Nevada, Texas and Georgia, but our
primary focus has remained on Florida. Starting in Orlando, we have built a
major franchise in Florida in markets characterized by inherent and sustained
growth. The addition of First Federal, which follows our previously announced
acquisition of Union Bank of Florida, represents a good fit with this strategy.
To date, we have acquired 19 financial institutions in Florida and are very
confident in our ability to efficiently integrate First Federal and take full
advantage of cost savings," said Mr. Lowder. Commenting on First Federal, Mr.
Lowder said, "First Federal is a well managed institution that has been very
successful in its Central Florida markets since it began 70 years ago.  We look
forward to Steve Kurtz joining Colonial's executive management team for our
Central Florida Region."

The 16 locations gained through this acquisition are expected to fold well into
Colonial's existing Central Florida Region, which is headquartered in Orlando
and has 46 locations from St. Augustine down to Melbourne and across the
Orlando area.  The merger will enhance Colonial's presence in Lake County where
it currently has five locations and will expand Colonial's Central Florida
Region to the west coast of Florida with its first locations in Sumter and
Citrus counties.

"This merger presents a great opportunity for First Federal's employees,
customers and shareholders to align ourselves with a bank that believes in the
same service principles that we have had since our inception in 1934.  By
joining the Colonial Bank team, we will be able to offer our customers a
broader array of services and an expanded network of banking facilities
throughout Central Florida and the state," said Mr. Kurtz.

Completion of the transaction with First Federal is subject to approval by
various regulatory agencies and FFLC Bancorp's shareholders.

Upon the completion of the acquisition of FFLC and the previously announced
acquisition of Union Bank of Florida, Colonial BancGroup will have over $20
billion in assets and 326 full service branches in Florida (161), Alabama
(118), Georgia (22), Nevada (13) and Texas (12). Colonial is traded on the New
York Stock Exchange under the symbol CNB. In most newspapers the stock is
listed as ColBgp. A supplemental Current Report on Form 8-K concerning this
transaction was also filed today which includes a map showing current Colonial
Bank locations along with First Federal Savings Bank of Lake County locations
and may be viewed at Colonial's website at http://www.colonialbank.com/ .

The information contained herein does not constitute an offer to sell any
securities.  The shareholders of FFLC Bancorp, Inc. shall receive and are urged
to read the Prospectus-Proxy Statement that will be filed with the Securities
and Exchange Commission as it will contain information that will be important
to their investment decision.  After they are filed with the SEC, these
documents shall also be available at the SEC's website at http://www.sec.gov/ .

Pursuant to the Safe Harbor provisions of Private Securities Litigation Reform
Act of 1995, the reader is also cautioned that this announcement contains
"forward looking statements" regarding Colonial BancGroup's and FFLC Bancorp's
future performance which are subject to risks and uncertainties that could
cause actual results to differ materially from those expressed or implied by
such statements. 

DATASOURCE: FFLC Bancorp, Inc.



CONTACT:  Flake Oakley of Colonial BancGroup, [phone]



Web site:  http://www.1stfederal.com/

http://www.colonialbank.com/ 

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