COASTALSTATES BANK, HOMEOWNERS MORTGAGE CLOSE SALE;
PURCHASE OF MORTGAGE FIRM BRINGS SIGNIFICANT ADVANTAGES

COLUMBIA, SC, July 27, 2007 – The purchase of Homeowners Mortgage Enterprises, Inc. headquartered in Columbia, SC by Hilton Head Island-based CoastalStates Bank was formalized earlier this month, following a due diligence period that left both parties to the deal “…more excited than when we first began talking about things.”

      The move will significantly increase the mortgage banking and related capabilities of both firms on a statewide basis. Terms of the transaction were not announced. 

      CoastalStates Bank was opened less than three years ago with a single Hilton Head Island, SC office and less than $16 million in assets.  It now one of the fastest-growing community banks in the nation with more than $334 million in assets and was named the sixth fastest growing company in South Carolina.

Homeowners Mortgage Enterprises, Inc. (HME) is a full service regional mortgage-banking firm headquartered in Columbia, SC. The 24 year-old company has 78 employees and buys loans from community banks, Farm Credit Banks, mortgage brokers and credit unions throughout the Southeast. Homeowners Mortgage is also the lender for Southland Log Homes. In addition, the company benefits from a strong retail presence in Columbia, Greenville and Charleston, SC. making it one of the largest privately owned mortgage banking firms in the state. 

      As part of the agreement, Douglas P. Clark, chairman and CEO of Homeowners Mortgage Enterprises and Robert Dozier, Jr. have been as CoastalStates Bank Directors.  In addition, Clark has assumed the position of Chief Financial Officer of CoastalStates Bank.   Clark will be moving to the CSB headquarters on Hilton Head Island while Dozier will continue to head operations in Columbia. 

      “We knew this was going to be a good arrangement,” said Randy Dolyniuk, CSB chairman and chief executive officer, “but what we didn’t know was just how strong an operation we were acquiring.  After spending nearly four months walking through every aspect of the Homeowners business, we’re seeing even more synergies emerge.”

      Dolyniuk said that in a single move CoastalStates Bank is now able to offer hundreds of additional mortgage products that benefit a wider range of clients with specifically tailored loan and refinancing needs.  He said that he expected the bank, already a significant mortgage products and services presence in the Lowcountry, to expand rapidly in the Midlands and Upstate areas of South Carolina.”

      The CoastalStates Bank response to the closed transaction was mirrored by executives from Homeowners Mortgage, who are looking to the future with considerable anticipation.

      “At a certain point in the evolution of a mortgage company you hit a time where access to capital and improved funding sources becomes an indispensable component of continued growth and success,” said Douglas P. Clark, chairman and CEO of Homeowners Mortgage.  “We bring well-established clients, a large market share and excellent mortgage products to the table.  CoastalStates Bank brings a proven team of banking professionals, a well-established growth orientation and access to capital and other funding sources. 

      “This is an exceptional arrangement for both of us, he said.”

      According to Dolyniuk, there are no anticipated personnel changes in either location, and Homeowners Mortgage will continue to operate under that name “…for the foreseeable future.” 

      The Homeowners Mortgage Corporate Office is at 2530 Devine Street, Columbia, SC. Other South Carolina offices include 5 Lake Carolina Way Columbia, Suite 240, SC; 612 St. Andrews Road, Ste. 12, Columbia, SC and 3236 Landmark Drive, Ste. 124, North Charleston, SC.

      South Carolina CoastalStates Bank offices are currently at 5 Bow Circle, Suite B; Mortgage Division headquarters at 18 New Orleans Road, 843-341-9960; a North Island office 98 Main Street, 843-689-7800; Bluffton headquarters at 167 Bluffton Road, Suite H, 843-837-0100 and a Beaufort office at 842-A Parris Avenue, Port Royal, 843-384-4380.  Additional offices will be announced shortly.

CoastalStates Bank is owned by local shareholders and run by some of the area’s most successful banking professionals. It offers a full line of state-of-the-art financial products and services with the personal care found only at a bank operated by friend and neighbors. Along with a variety of personal and business checking accounts, high-yielding investment products, mortgage and business loans and home equity lines, CoastalStates’ services include 24-hour telephone account access and online banking. For more information on CoastalStates Bank, call 341-9900 or toll-free 1-888-RING-CSB (1-888-746-4272).