/FIRST AND FINAL ADD -- CLW026 -- Main Street Banks (Nasdaq: MSBK) Earnings/

/FIRST AND FINAL ADD -- CLW026 -- Main Street Banks (Nasdaq: MSBK) Earnings/ MAIN STREET BANKS, INC. AND SUBSIDIARIES AVERAGE BALANCE SHEET (Unaudited) Fourth Third Second Quarter Quarter Quarter 2004 2004 2004 ASSETS Cash and due from banks $40,385,275 $39,565,158 $38,220,151 Interest-bearing deposits in banks 323,412 662,555 660,111 Federal funds sold and securities purchased under agreements to resell 36,014,795 1,037,646 357,846 Investment securities available for sale 282,198,873 276,497,775 270,851,196 Investment securities held to maturity 11,733,821 11,945,588 11,998,340 Other investments 21,866,256 24,140,813 21,352,832 Mortgage loans held for sale 7,413,513 5,954,007 7,860,559 Loans, net of unearned income 1,670,976,218 1,620,436,393 1,551,258,388 Allowance for loan losses (24,559,019) (23,402,241) (22,505,292) Loans, net 1,646,417,199 1,597,034,152 1,528,753,096 Premises and equipment, net 52,672,981 50,125,904 46,440,339 Other real estate 1,868,635 1,914,645 2,584,703 Accrued interest receivable 9,091,675 9,058,791 7,874,920 Goodwill and other intangible assets 103,299,382 103,470,116 103,445,869 Bank owned life insurance 41,722,058 41,191,340 41,471,029 Other assets 16,774,679 14,198,902 14,863,167 Total assets $2,271,782,554 $2,176,797,392 $2,096,734,158 LIABILITIES Total deposits $1,687,864,307 $1,584,818,716 $1,547,738,831 Accrued interest payable 3,678,457 3,312,458 3,129,282 Federal Home Loan Bank advances 205,771,676 158,242,407 148,344,127 Federal funds purchased and securities sold under repurchase agreements 80,364,169 153,386,148 126,594,813 Trust preferred securities - - - Subordinated debt 51,547,000 51,547,000 51,547,000 Other liabilities 7,761,366 7,432,893 4,329,275 Total liabilities 2,036,986,975 1,958,739,621 1,881,683,328 SHAREHOLDERS' EQUITY Common stock-no par value per share 116,719,468 107,626,919 107,346,374 Retained earnings 126,192,533 120,402,848 114,838,884 Accumulated other comprehensive income 673,167 (1,182,407) 1,655,161 Treasury stock (8,789,589) (8,789,589) (8,789,589) Total shareholders' equity 234,795,579 218,057,771 215,050,830 Total liabilities and shareholders' equity $2,271,782,554 $2,176,797,392 $2,096,734,158 MAIN STREET BANKS, INC. AND SUBSIDIARIES AVERAGE BALANCE SHEET (Unaudited) First Fourth Quarter Quarter 2004 2003 ASSETS Cash and due from banks $37,174,008 $38,074,607 Interest-bearing deposits in banks 206,921 1,037,948 Federal funds sold and securities purchased under agreements to resell 13,733,915 35,288,778 Investment securities available for sale 249,633,094 248,724,785 Investment securities held to maturity 11,233,274 3,382,680 Other investments 20,172,234 18,799,718 Mortgage loans held for sale 4,685,417 3,841,104 Loans, net of unearned income 1,470,876,346 1,424,858,073 Allowance for loan losses (21,409,245) (20,816,925) Loans, net 1,449,467,101 1,404,041,148 Premises and equipment, net 43,622,711 42,801,524 Other real estate 2,813,337 1,941,348 Accrued interest receivable 7,614,443 7,407,238 Goodwill and other intangible assets 98,655,805 95,040,910 Bank owned life insurance 37,904,493 35,462,722 Other assets 10,054,978 10,291,118 Total assets $1,986,971,731 $1,946,135,628 LIABILITIES Total deposits $1,466,086,785 $1,452,073,218 Accrued interest payable 3,023,843 3,133,317 Federal Home Loan Bank advances 147,072,474 191,157,159 Federal funds purchased and securities sold under repurchase agreements 110,799,890 47,439,961 Trust preferred securities - 50,000,000 Subordinated debt 50,000,000 - Other liabilities 4,717,074 5,956,643 Total liabilities 1,781,700,066 1,749,760,298 SHAREHOLDERS' EQUITY Common stock-no par value per share 102,361,167 99,587,649 Retained earnings 107,198,497 101,961,196 Accumulated other comprehensive income 4,501,139 3,615,380 Treasury stock (8,789,138) (8,788,895) Total shareholders' equity 205,271,665 196,375,330 Total liabilities and shareholders' equity $1,986,971,731 $1,946,135,628 MAIN STREET BANKS, INC. AND SUBSIDIARIES AVERAGE BALANCE SHEET (Unaudited) December 31, December 31, 2004 2003 ASSETS Cash and due from banks $38,506,380 $34,163,079 Interest-bearing deposits in banks 207,848 1,199,130 Federal funds sold and securities purchased under agreements to resell 13,107,265 15,259,950 Investment securities available for sale 269,842,697 242,678,414 Investment securities held to maturity 11,730,115 1,361,496 Other investments 21,169,539 12,176,302 Mortgage loans held for sale 6,479,814 5,364,600 Loans, net of unearned income 1,578,621,779 1,259,640,182 Allowance for loan losses (22,974,340) (18,396,615) Loans, net 1,555,647,439 1,241,243,567 Premises and equipment, net 48,235,152 38,264,707 Other real estate 2,296,443 1,425,209 Accrued interest receivable 8,413,813 6,926,309 Goodwill and other intangible assets 102,236,584 62,221,009 Bank owned life insurance 40,582,967 33,471,078 Other assets 15,285,106 8,457,472 Total assets $2,133,741,162 $1,704,212,322 LIABILITIES Total deposits $1,571,722,772 $1,313,887,932 Accrued interest payable 3,296,143 3,222,737 Federal Home Loan Bank advances 164,973,073 130,833,369 Federal funds purchased and securities sold under repurchase agreements 117,731,224 44,875,584 Trust preferred securities - 31,783,430 Subordinated debt 51,166,590 - Other liabilities 6,171,166 11,113,301 Total liabilities 1,915,060,968 1,535,716,353 SHAREHOLDERS' EQUITY Common stock-no par value per share 108,531,170 77,903,662 Retained earnings 117,570,598 94,574,145 Accumulated other comprehensive income 1,367,903 4,466,572 Treasury stock (8,789,477) (8,448,410) Total shareholders' equity 218,680,194 168,495,969 Total liabilities and shareholders' equity $2,133,741,162 $1,704,212,322 MAIN STREET BANKS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (Unaudited) Fourth Third Second Quarter Quarter Quarter 2004 2004 2004 ASSETS Cash and due from banks $35,090,563 $55,719,486 $42,090,671 Interest-bearing deposits in banks 317,953 1,058,235 1,078,334 Federal funds sold and securities purchased under agreements to resell 35,812,949 24,410,000 713,000 Investment securities available for sale 315,520,771 282,814,235 272,596,604 Investment securities held to maturity 11,715,948 11,835,353 11,998,436 Other investments 23,781,977 23,040,424 23,876,638 Mortgage loans held for sale 4,562,962 6,931,843 6,221,181 Loans, net of unearned income 1,699,035,573 1,653,615,534 1,594,290,721 Allowance for loan losses (25,191,175) (24,256,034) (23,118,946) Loans, net 1,673,844,398 1,629,359,500 1,571,171,775 Premises and equipment, net 53,469,516 52,504,434 48,391,110 Other real estate 2,141,040 1,082,267 1,914,985 Accrued interest receivable 9,762,826 9,243,097 9,060,367 Goodwill and other intangible assets 102,169,572 103,392,163 103,514,753 Bank owned life insurance 42,056,525 41,528,162 41,006,405 Other assets 16,286,895 15,473,682 13,530,493 Total assets $2,326,533,895 $2,258,392,881 $2,147,164,752 LIABILITIES Total deposits $1,710,209,913 $1,630,286,409 $1,566,290,310 Accrued interest payable 3,955,183 3,488,406 3,284,308 Federal Home Loan Bank advances 201,070,198 226,203,972 166,337,747 Federal funds purchased and securities sold under repurchase agreements 73,367,456 115,191,909 142,324,882 Trust preferred securities - - - Subordinated debt 51,547,000 51,547,000 51,547,000 Other liabilities 8,300,069 9,353,208 5,413,930 Total liabilities 2,048,449,819 2,036,070,904 1,935,198,177 SHAREHOLDERS' EQUITY Common stock-no par value per share 159,520,536 108,197,312 107,446,736 Retained earnings 127,566,247 121,717,798 116,073,951 Accumulated other comprehensive income (213,118) 1,196,456 (2,764,523) Treasury stock (8,789,589) (8,789,589) (8,789,589) Total shareholders' equity 278,084,076 222,321,977 211,966,575 Total liabilities and shareholders' equity $2,326,533,895 $2,258,392,881 $2,147,164,752 MAIN STREET BANKS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (Unaudited) First Fourth Quarter Quarter 2004 2003 ASSETS Cash and due from banks $31,901,310 $39,839,060 Interest-bearing deposits in banks 588,694 1,021,288 Federal funds sold and securities purchased under agreements to resell 5,644,000 31,819,619 Investment securities available for sale 263,304,831 247,391,640 Investment securities held to maturity 11,998,297 10,788,146 Other investments 19,205,358 19,651,370 Mortgage loans held for sale 7,208,105 5,670,625 Loans, net of unearned income 1,511,436,809 1,443,325,787 Allowance for loan losses (22,150,651) (21,151,987) Loans, net 1,489,286,158 1,422,173,800 Premises and equipment, net 45,167,765 42,760,918 Other real estate 2,255,553 1,844,869 Accrued interest receivable 8,293,918 8,181,579 Goodwill and other intangible assets 103,381,314 96,237,492 Bank owned life insurance 41,595,547 35,773,237 Other assets 15,801,590 8,611,815 Total assets $2,045,632,440 $1,971,765,458 LIABILITIES Total deposits $1,530,979,973 $1,458,403,096 Accrued interest payable 3,210,642 3,020,265 Federal Home Loan Bank advances 156,471,522 210,605,296 Federal funds purchased and securities sold under repurchase agreements 83,930,239 43,859,277 Trust preferred securities - 50,000,000 Subordinated debt 51,547,000 - Other liabilities 4,116,702 5,334,408 Total liabilities 1,830,256,078 1,771,222,342 SHAREHOLDERS' EQUITY Common stock-no par value per share 109,117,216 100,875,984 Retained earnings 109,299,987 104,539,042 Accumulated other comprehensive income 5,748,748 3,917,179 Treasury stock (8,789,589) (8,789,089) Total shareholders' equity 215,376,362 200,543,116 Total liabilities and shareholders' equity $2,045,632,440 $1,971,765,458 MAIN STREET BANKS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (Unaudited) December 31, December 31, 2004 2003 ASSETS Cash and due from banks 35,090,563 $39,839,060 Interest-bearing deposits in banks 317,953 1,021,288 Federal funds sold and securities purchased under agreements to resell 35,812,949 31,819,619 Investment securities available for sale 315,520,771 247,391,640 Investment securities held to maturity 11,715,948 10,788,146 Other investments 23,781,977 19,651,370 Mortgage loans held for sale 4,562,962 5,670,625 Loans, net of unearned income 1,699,035,573 1,443,325,787 Allowance for loan losses (25,191,175) (21,151,987) Loans, net 1,673,844,398 1,422,173,800 Premises and equipment, net 53,469,516 42,760,918 Other real estate 2,141,040 1,844,869 Accrued interest receivable 9,762,826 8,181,579 Goodwill and other intangible assets 102,169,572 96,237,492 Bank owned life insurance 42,056,525 35,773,237 Other assets 16,286,895 8,611,815 Total assets $2,326,533,895 $1,971,765,458 LIABILITIES Total deposits 1,710,209,913 $1,458,403,096 Accrued interest payable 3,955,183 3,020,265 Federal Home Loan Bank advances 201,070,198 210,605,296 Federal funds purchased and securities sold under repurchase agreements 73,367,456 43,859,277 Trust preferred securities - 50,000,000 Subordinated debt 51,547,000 - Other liabilities 8,300,069 5,334,408 Total liabilities 2,048,449,819 1,771,222,342 SHAREHOLDERS' EQUITY Common stock-no par value per share 159,520,536 100,875,984 Retained earnings 127,566,247 104,539,042 Accumulated other comprehensive income (213,118) 3,917,179 Treasury stock (8,789,589) (8,789,089) Total shareholders' equity 278,084,076 200,543,116 Total liabilities and shareholders' equity $2,326,533,895 $1,971,765,458 MAIN STREET BANKS, INC. AND SUBSIDIARIES LOAN AND DEPOSIT STRATIFICATION (Unaudited) Fourth Third Second Quarter Quarter Quarter 2004 2004 2004 LOAN PORTFOLIO Real estate: Residential Mortgage $288,703,328 $284,647,539 $282,754,653 Construction 401,815,256 379,468,496 348,685,270 Commercial real estate 846,945,431 826,434,480 795,114,435 Commercial and Industrial 127,476,473 129,790,889 132,379,349 Consumer 36,966,630 35,901,922 37,602,059 Unearned income (2,871,545) (2,627,791) (2,245,045) Total loans $1,699,035,573 $1,653,615,534 $1,594,290,721 Loan growth 2.7% 3.7% 5.5% Loan growth, annualized 10.9% 14.8% 22.0% DEPOSITS Non-interest bearing demand $224,958,448 $236,808,861 $232,319,420 Interest bearing demand 107,167,500 111,972,487 109,183,366 Money Market 407,981,856 346,698,652 347,395,886 Savings 39,401,660 40,705,887 40,307,875 Total transaction accounts 779,509,464 736,185,886 729,206,548 Public funds - transaction 150,534,921 132,267,045 90,423,130 Total low cost core deposits 930,044,385 868,452,931 819,629,677 Time deposits - public funds 13,696,451 14,012,373 15,991,062 Time deposits 766,469,077 747,821,105 730,669,570 Total deposits $1,710,209,913 $1,630,286,409 $1,566,290,310 Deposit growth 4.9% 4.1% 2.3% Deposit growth, annualized 19.5% 16.3% 9.3% Percentage low cost core to total deposits 54.4% 53.3% 52.3% Percentage growth of low cost core deposits 7.1% 6.0% 3.1% Annualized growth of low cost core deposits 28.2% 23.7% 12.6% *The acquisition of First Colony Bank was completed in the second quarter of 2003 MAIN STREET BANKS, INC. AND SUBSIDIARIES LOAN AND DEPOSIT STRATIFICATION (Unaudited) First Fourth Quarter Quarter 2004 2003 LOAN PORTFOLIO Real estate: Residential Mortgage $280,453,804 $269,357,951 Construction 314,171,269 304,045,641 Commercial real estate 762,815,561 711,208,711 Commercial and Industrial 116,735,287 118,242,893 Consumer 39,063,480 41,649,590 Unearned income (1,802,592) (1,178,999) Total loans $1,511,436,809 $1,443,325,787 Loan growth 4.7% 2.2%* Loan growth, annualized 19.0% 8.9%* DEPOSITS Non-interest bearing demand $227,159,637 $222,595,661 Interest bearing demand 112,043,973 116,749,330 Money Market 313,554,963 266,913,040 Savings 40,074,116 40,000,806 Total transaction accounts 692,832,689 646,258,837 Public funds - transaction 101,844,740 115,258,296 Total low cost core deposits 794,677,429 761,517,133 Time deposits - public funds 17,565,349 10,741,662 Time deposits 718,737,195 686,444,301 Total deposits $1,530,979,973 $1,458,703,096 Deposit growth 5.0% 1.5% Deposit growth, annualized 19.9% 5.9% Percentage low cost core to total deposits 51.9% 52.2% Percentage growth of low cost core deposits 4.4% 3.4%* Annualized growth of low cost core deposits 17.5% 13.4%* *The acquisition of First Colony Bank was completed in the second quarter of 2003 MAIN STREET BANKS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (Unaudited) Fourth Third Second First Quarter Quarter Quarter Quarter 2004 2004 2004 2004 NET INTEREST INCOME Loan, including fees $28,519,255 $26,809,369 $25,473,584 $24,781,842 Interest on investment securities: Taxable 2,518,397 2,428,436 2,362,075 2,247,038 Non-taxable 351,946 365,183 388,746 417,657 Federal funds sold and repurchase agreements 147,716 2,111 3,751 30,399 Interest bearing deposits in banks 7,495 6,545 3,724 5,223 Interest on other investments 122,662 240,218 238,518 205,662 Total interest income 31,667,471 29,851,862 28,470,398 27,687,821 INTEREST EXPENSE Interest-bearing demand and money market 2,505,441 1,885,099 1,828,848 1,322,218 Savings 64,185 61,766 73,775 88,707 Time deposits 5,117,216 4,756,612 4,470,715 4,463,088 Other time deposits 65,963 64,442 64,462 55,813 Federal funds purchased 357,707 561,511 333,018 34,701 Federal Home Loan Bank advances 1,227,700 876,478 663,793 866,258 Interest expense on subordinated debentures 724,326 637,085 574,946 574,946 Other 174,220 175,900 241,599 355,692 Total interest expense 10,236,758 9,018,893 8,251,156 7,761,423 Net interest income 21,430,713 20,832,969 20,219,242 19,926,398 Provision for loan losses 2,956,380 1,602,500 1,310,000 1,561,000 Net interest income after provision for loan losses 18,474,333 19,230,469 18,909,242 18,365,398 NON-INTEREST INCOME Service charges on deposit accounts 2,047,804 2,165,224 2,023,191 1,880,521 Other customer service fees 375,445 276,909 352,392 356,795 Mortgage banking revenue 721,363 809,807 859,631 883,128 Investment brokerage revenue 194,241 133,479 185,330 315,080 Insurance agency revenue 2,393,185 2,514,479 2,370,375 2,771,701 Income from SBA lending 946,164 1,270,397 367,859 485,918 Other income 863,542 651,387 1,259,930 1,146,755 Total non-interest income 7,541,744 7,821,682 7,418,708 7,839,898 NON-INTEREST EXPENSE Salaries and other compensation 8,208,721 7,999,790 7,688,444 8,041,199 Employee benefits 1,195,115 1,170,201 1,519,972 1,640,263 Net occupancy and equipment expense 2,079,450 2,090,931 2,208,378 1,859,695 Data processing fees 554,645 325,617 223,450 557,301 Professional services 506,351 715,789 583,177 438,395 Communications and supplies 893,426 1,027,203 1,027,631 1,050,888 Amortization of intangible assets 122,591 122,591 121,758 140,644 Other expense 1,850,106 2,042,088 2,761,271 1,850,650 Total non-interest expense 15,410,405 15,494,210 16,134,081 15,579,035 Income before income taxes 10,605,672 11,557,941 10,193,869 10,626,261 Income tax expense 2,907,090 3,294,026 2,802,851 3,029,516 Net income $7,698,582 $8,263,915 $7,391,018 $7,596,745 EARNINGS PER SHARE Basic $0.39 $0.43 $0.38 $0.39 Diluted $0.38 $0.41 $0.37 $0.38 WEIGHTED AVERAGE SHARES OUTSTANDING Basic 19,756,947 19,428,145 19,351,343 19,280,882 Diluted 20,372,205 20,015,560 19,974,058 19,910,810 CASH DIVIDENDS PER SHARE $0.135 $0.135 $0.135 $0.135 MAIN STREET BANKS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (Unaudited) Fourth Twelve months ended Quarter December 31, 2003 2004 2003 NET INTEREST INCOME Loan, including fees $24,045,242 $105,584,050 $88,172,417 Interest on investment securities: Taxable 2,136,462 9,555,946 8,308,729 Non-taxable 376,992 1,523,532 1,671,248 Federal funds sold and repurchase agreements 75,418 183,977 145,920 Interest bearing deposits in banks 9,114 22,987 28,680 Interest on other investments 204,453 807,060 507,372 Total interest income 26,847,681 117,677,552 98,834,366 INTEREST EXPENSE Interest-bearing demand and money market 1,288,087 7,541,606 5,735,210 Savings 89,583 288,433 348,502 Time deposits 4,261,858 18,807,631 15,691,659 Other time deposits 85,577 250,680 380,389 Federal funds purchased 36,153 1,286,937 76,190 Federal Home Loan Bank advances 795,729 3,634,229 2,269,584 Interest expense on subordinated debentures 580,102 2,511,303 1,452,606 Other 370,193 947,411 1,510,515 Total interest expense 7,507,282 35,268,230 27,464,655 Net interest income 19,340,399 82,409,322 71,369,711 Provision for loan losses 1,241,000 7,429,880 5,235,000 Net interest income after provision for loan losses 18,099,399 74,979,442 66,134,711 NON-INTEREST INCOME Service charges on deposit accounts 2,069,881 8,116,740 7,760,183 Other customer service fees 396,098 1,361,541 1,544,385 Mortgage banking revenue 711,660 3,273,929 3,341,846 Investment brokerage revenue 30,758 828,130 263,477 Insurance agency revenue 1,252,337 10,049,740 4,856,983 Income from SBA lending 434,799 3,070,338 1,724,914 Other income 2,000,907 3,921,614 4,852,003 Total non-interest income 6,896,440 30,622,032 24,343,791 NON-INTEREST EXPENSE Salaries and other compensation 6,956,283 31,938,154 25,573,961 Employee benefits 1,213,020 5,525,551 4,749,509 Net occupancy and equipment expense 2,003,525 8,238,454 6,660,869 Data processing fees 481,895 1,661,013 1,683,825 Professional services 363,319 2,243,712 2,149,893 Communications and supplies 1,168,727 3,999,148 3,736,305 Amortization of intangible assets 106,800 507,584 364,499 Other expense 2,342,800 8,504,115 8,023,684 Total non-interest expense 14,636,369 62,617,731 52,942,545 Income before income taxes 10,359,470 42,983,743 37,535,957 Income tax expense 2,912,764 12,033,483 10,836,627 Net income $7,446,706 $30,950,260 $26,699,330 EARNINGS PER SHARE Basic $0.39 $1.59 $1.49 Diluted $0.38 $1.54 $1.44 WEIGHTED AVERAGE SHARES OUTSTANDING Basic 18,951,688 19,455,084 17,875,246 Diluted 19,645,157 20,076,687 18,556,383 CASH DIVIDENDS PER SHARE $0.120 $0.540 $0.480 MAIN STREET BANKS, INC. AND SUBSIDIARIES SUMMARY OF INTEREST RATES (TAX-EQUIVALENT*) (Unaudited) Fourth Third Second First Quarter Quarter Quarter Quarter 2004 2004 2004 2004 EARNING ASSETS Total interest earning assets (in thousands) $2,030,527 $1,940,675 $1,864,339 $1,770,541 Loans 6.77% 6.56% 6.58% 6.68% Investment securities 4.13% 4.11% 4.20% 4.49% Federal funds sold 1.63% 1.18% 1.12% 1.01% Loans held for sale 4.65% 4.93% 4.57% 5.25% FHLB stock & other 2.33% 3.96% 4.43% 4.03% Total interest earning assets 6.20% 6.12% 6.14% 6.29% INTEREST-BEARING LIABILITIES Total interest-bearing liabilities (in thousands) $2,025,547 $1,947,994 $1,874,225 $1,773,959 Demand deposits 1.26% 0.92% 0.92% 0.72% Demand deposits - public funds 0.43% 0.61% 1.05% 1.07% Time deposits 2.72% 2.59% 2.49% 2.49% Retail repurchases 1.62% 1.62% 1.69% 1.69% Federal funds purchased 2.28% 1.68% 1.37% 1.24% Federal Home Loan bank advances 2.37% 2.20% 1.80% 1.77% Securities sold under agreement to repurchase 4.53% 4.53% 4.57% 4.09% Subordinated debentures 5.59% 4.92% 4.49% 4.55% Net Cost of Funds 2.01% 1.84% 1.77% 1.76% NET INTEREST SPREAD Interest earning assets less interest-bearing liabilities (in thousands) $4,980 $(7,319) $(9,885) $(3,418) Yield on earning assets less cost of interest- bearing liabilities 4.19% 4.28% 4.37% 4.53% NET INTEREST MARGIN Net interest income (tax equivalent) as a percentage of average earning assets 4.23% 4.31% 4.41% 4.58% * To make pre-tax income and resultant yields on tax-exempt investments comparable to those on taxable investments, a tax-equivalent adjustment has been computed using a federal income tax rate of 34%. MAIN STREET BANKS, INC. AND SUBSIDIARIES SUMMARY OF INTEREST RATES (TAX-EQUIVALENT*) (Unaudited) Fourth Twelve months ended Quarter December 31, 2003 2004 2003 EARNING ASSETS Total interest earning assets (in thousands) $1,735,933 $1,862,913 $1,537,680 Loans 6.61% 6.80% 6.90% Investment securities 4.36% 4.21% 4.54% Federal funds sold 0.91% 1.40% 1.05% Loans held for sale 5.50% 4.81% 5.88% FHLB stock & other 4.36% 3.88% 4.01% Total interest earning assets 6.21% 6.32% 6.53% INTEREST-BEARING LIABILITIES Total interest-bearing liabilities (in thousands) $1,739,771 $1,865,292 $1,522,004 Demand deposits 0.68% 0.99% 0.90% Demand deposits - public funds 0.95% 0.70% 0.90% Time deposits 2.47% 2.67% 2.51% Retail repurchases 1.71% 1.65% 1.82% Federal funds purchased 1.25% 1.45% 1.43% Federal Home Loan bank advances 1.78% 2.20% 1.77% Securities sold under agreement to repurchase 4.09% 4.39% 3.95% Subordinated debentures 4.54% 4.91% 4.51% Net Cost of Funds 1.71% 2.53% 1.80% NET INTEREST SPREAD Interest earning assets less interest- bearing liabilities (in thousands) $(3,838) $(2,379) $15,676 Yield on earning assets less cost of interest-bearing liabilities 4.50% 3.79% 4.72% NET INTEREST MARGIN Net interest income (tax equivalent) as a percentage of average earning assets 4.48% 4.47% 4.71% * To make pre-tax income and resultant yields on tax-exempt investments comparable to those on taxable investments, a tax-equivalent adjustment has been computed using a federal income tax rate of 34%. MAIN STREET BANKS, INC. AND SUBSIDIARIES LOAN QUALITY (Unaudited) Fourth Third Second First Quarter Quarter Quarter Quarter 2004 2004 2004 2004 RESERVE FOR POSSIBLE LOAN LOSSES Reserve for loan losses at beginning of period $24,256,034 $23,118,946 $22,150,651 $21,151,987 Reserves acquired through acquisition - - - - Provision for loan losses 2,956,380 1,602,500 1,310,000 1,561,000 Loans charged-off during the period (2,289,524) (1,103,582) (657,213) (650,138) Recoveries on loans previously charged- off 268,285 638,170 315,508 87,802 Net loans (charged-off) recovered during period (2,021,239) (465,412) (341,705) (562,336) Reserve for loan losses at end of period $25,191,175 $24,256,034 $23,118,946 $22,150,651 Net charge-offs to average loans, annualized 0.48% 0.11% 0.09% 0.15% Gross charge-offs to average loans, annualized 0.55% 0.27% 0.17% 0.18% Recoveries as a percentage of gross charge-offs 11.72% 57.83% 48.01% 13.51% Reserve for loan losses as a percentage of loans, at end of period 1.48% 1.47% 1.45% 1.47% NON-PERFORMING ASSETS Loans accounted for on a non-accrual basis $12,254,820 $4,712,752 $5,179,265 $4,822,135 Restructured loans - - - - Total non-performing loans 12,254,820 4,712,752 5,179,265 4,822,135 Foreclosed assets 2,165,914 1,132,377 3,730,693 2,255,553 Total non-performing assets $14,420,734 $5,845,129 $8,909,958 $7,077,688 Non-performing assets as a percentage of loans plus foreclosed assets, at end of period 0.85% 0.35% 0.56% 0.47% Non-performing assets as a percentage of total assets, at end of period 0.62% 0.26% 0.41% 0.35% Reserve for loan losses as a percentage of non-performing assets, at end of period 174.69% 414.98% 259.47% 312.96% Loans 90 days past due and still accruing $5,657,986 $2,062,584 $3,628,399 $5,934,220 Loans 90 days past due and still accruing as a percentage of loans, at end of period 0.33% 0.12% 0.23% 0.39% MAIN STREET BANKS, INC. AND SUBSIDIARIES LOAN QUALITY (Unaudited) Fourth Twelve months ended Quarter December 31, 2003 2004 2003 RESERVE FOR POSSIBLE LOAN LOSSES Reserve for loan losses at beginning of period $20,765,377 $21,151,987 $14,588,582 Reserves acquired through acquisition - - 4,252,018 Provision for loan losses 1,241,000 7,429,880 5,235,000 Loans charged-off during the period (958,275) (4,700,457) (3,336,038) Recoveries on loans previously charged-off 103,885 1,309,765 412,425 Net loans (charged-off) recovered during period (854,390) (3,390,692) (2,923,613) Reserve for loan losses at end of period $21,151,987 $25,191,175 $21,151,987 Net charge-offs to average loans, annualized 0.24% 0.21% 0.23% Gross charge-offs to average loans, annualized 0.27% 0.30% 0.26% Recoveries as a percentage of gross charge-offs 10.84% 27.86% 12.85% Reserve for loan losses as a percentage of loans, at end of period 1.47% 1.48% 1.47% NON-PERFORMING ASSETS Loans accounted for on a non-accrual basis $11,548,489 $12,254,820 $11,548,489 Restructured loans - - - Total non-performing loans 11,548,489 12,254,820 11,548,489 Foreclosed assets 1,844,869 2,165,914 1,844,869 Total non-performing assets $13,393,358 $14,420,734 $13,393,358 Non-performing assets as a percentage of loans plus foreclosed assets, at end of period 0.93% 0.85% 0.93% Non-performing assets as a percentage of total assets, at end of period 0.68% 0.62% 0.68% Reserve for loan losses as a percentage of non-performing assets, at end of period 157.93% 174.69% 157.93% Loans 90 days past due and still accruing $1,921,837 $5,657,986 $1,921,837 Loans 90 days past due and still accruing as a percentage of loans, at end of period 0.13% 0.33% 0.13% MAIN STREET BANKS, INC. AND SUBSIDIARIES FINANCIAL HIGHLIGHTS (Unaudited) Fourth Third Second First Quarter Quarter Quarter Quarter 2004 2004 2004 2004 RESULTS OF OPERATIONS Net interest income $21,430,713 $20,832,969 $20,219,242 $19,926,398 Net interest income (tax equivalent) 21,612,019 21,021,094 20,419,505 20,141,555 Provision for loan losses 2,956,380 1,602,500 1,310,000 1,561,000 Non-interest income 7,541,744 7,821,682 7,418,708 7,839,898 Non-interest expense 15,410,405 15,494,210 16,134,081 15,579,035 Net income 7,698,582 8,263,915 7,391,018 7,596,745 AVERAGE BALANCE SHEET DATA (in thousands) Loans, net of unearned income 1,670,976 1,620,436 1,551,258 1,470,876 Investment securities 293,933 288,443 282,850 260,866 Earning assets 2,030,527 1,940,675 1,864,339 1,770,541 Total assets 2,271,783 2,176,797 2,096,734 1,986,972 Deposits 1,687,864 1,584,819 1,547,739 1,466,087 Shareholders' equity 234,796 218,058 215,051 205,272 PER COMMON SHARE Earnings per share - Basic $0.39 $0.43 $0.38 $0.39 Earnings per share - Diluted $0.38 $0.41 $0.37 $0.38 Book value per share as end of period $13.10 $11.43 $10.94 $11.14 End of period shares outstanding 21,229,545 19,457,741 19,381,000 19,340,676 Weighted average shares outstanding Basic 19,756,947 19,428,145 19,351,343 19,280,882 Diluted 20,372,205 20,015,560 19,974,058 19,910,810 STOCK PERFORMANCE Market Price: Closing $34.93 $30.60 $28.10 $27.34 High $34.93 $30.60 $28.82 $27.50 Low $28.55 $26.46 $25.62 $24.90 Trading volume 2,893,800 1,755,400 2,010,000 1,703,700 Cash dividend per share 0.135 0.135 0.135 0.135 Dividend payout ratio 35.72% 32.70% 36.48% 35.38% Price to earnings 23.23 18.63 18.88 17.82 Price to book value 2.67 2.68 2.57 2.46 PERFORMANCE RATIOS Return on average assets 1.36% 1.52% 1.41% 1.53% Return on average equity 13.12% 15.16% 13.75% 14.80% Average earning assets to average total assets 89.38% 89.15% 88.92% 89.11% Average loans as percentage of average deposits 99.00% 102.25% 100.23% 100.33% Net interest margin (tax equivalent) 4.23% 4.31% 4.41% 4.58% Average equity to average assets 10.34% 10.02% 10.26% 10.33% Non-interest income ratio 26.03% 27.30% 26.84% 28.24% Efficiency ratio 53.19% 54.07% 58.38% 56.11% ASSET QUALITY Total non-performing assets $14,420,734 $5,845,129 $8,909,958 $7,077,688 Non-performing assets as a percentage of loans plus foreclosed assets 0.85% 0.35% 0.56% 0.47% Net annualized (charge-offs) recoveries as a percentage of average loans 0.48% 0.11% 0.09% 0.15% Reserve for loan losses as a percentage of loans, at end of period 1.48% 1.47% 1.45% 1.47% MAIN STREET BANKS, INC. AND SUBSIDIARIES FINANCIAL HIGHLIGHTS (Unaudited) Fourth Third Second First Quarter Quarter Quarter Quarter 2004 2004 2004 2004 OPERATING EARNINGS Net income $7,698,582 $8,263,915 $7,391,018 $7,596,745 Amortization of intangible assets, net 88,266 88,266 87,666 101,264 Job reductions - - 231,845 - Contract buyout, net - - 172,366 - Systems write-offs, net - - 342,104 - Operating income $7,786,848 $8,352,181 $8,224,998 $7,698,009 Operating earnings per share Basic $0.39 $0.43 $0.43 $0.40 Diluted $0.38 $0.42 $0.41 $0.39 Average tangible assets (in thousands) $2,168,483 $2,073,327 $1,993,288 $1,888,316 Average tangible equity (in thousands) 131,496 114,588 111,605 106,616 Operating return on average tangible assets 1.44% 1.61% 1.65% 1.63% Operating return on average tangible equity 23.69% 29.16% 29.48% 28.88% OPERATING BASIS Non-interest expense $15,276,669 $15,360,474 $16,001,254 $15,425,605 Net interest income 21,430,713 20,832,969 20,219,242 19,926,398 Non-interest income 7,541,744 7,821,682 7,418,708 7,839,898 Efficiency Ratio 52.73% 53.61% 57.90% 55.56% MAIN STREET BANKS, INC. AND SUBSIDIARIES FINANCIAL HIGHLIGHTS (Unaudited) Fourth Twelve months ended Quarter December 31, 2003 2004 2003 RESULTS OF OPERATIONS Net interest income $19,340,399 $82,409,322 $71,369,711 Net interest income (tax equivalent) 19,591,290 83,194,172 72,465,527 Provision for loan losses 1,241,000 7,429,880 5,235,000 Non-interest income 6,896,440 30,622,032 24,343,791 Non-interest expense 14,636,369 62,617,731 52,942,545 Net income 7,446,706 30,950,260 26,699,330 AVERAGE BALANCE SHEET DATA (in thousands) Loans, net of unearned income 1,424,858 1,578,622 1,259,640 Investment securities 252,107 281,573 244,040 Earning assets 1,735,933 1,901,159 1,537,680 Total assets 1,946,136 2,133,741 1,704,212 Deposits 1,452,073 1,571,723 1,313,888 Shareholders' equity 196,375 218,680 168,496 PER COMMON SHARE Earnings per share - Basic $0.39 $1.59 $1.49 Earnings per share - Diluted $0.38 $1.54 $1.44 Book value per share as end of period $10.57 $13.10 $10.50 End of period shares outstanding 18,981,340 21,229,545 18,981,340 Weighted average shares outstanding Basic 18,951,688 19,455,084 17,875,246 Diluted 19,645,157 20,076,687 18,556,383 STOCK PERFORMANCE Market Price: Closing $26.52 $34.93 $26.52 High $27.92 $34.93 $27.92 Low $25.00 $24.90 $18.45 Trading volume 1,630,300 8,362,900 5,159,500 Cash dividend per share 0.120 0.540 0.480 Dividend payout ratio 31.66% 35.03% 33.36% Price to earnings 17.63 16.96 18.43 Price to book value 2.51 2.67 2.53 PERFORMANCE RATIOS Return on average assets 1.53% 1.45% 1.57% Return on average equity 15.17% 14.15% 15.85% Average earning assets to average total assets 89.20% 89.10% 90.23% Average loans as percentage of average deposits 98.13% 100.44% 95.87% Net interest margin (tax equivalent) 4.48% 4.47% 4.73% Average equity to average assets 10.09% 10.25% 9.89% Non-interest income ratio 26.29% 27.09% 25.43% Efficiency ratio 55.79% 55.40% 55.31% ASSET QUALITY Total non-performing assets $13,393,358 $14,420,734 $13,393,358 Non-performing assets as a percentage of loans plus foreclosed assets 0.93% 0.85% 0.93% Net annualized (charge-offs) recoveries as a percentage of average loans 0.24% 0.21% 0.23% Reserve for loan losses as a percentage of loans, at end of period 1.47% 1.48% 1.47% MAIN STREET BANKS, INC. AND SUBSIDIARIES FINANCIAL HIGHLIGHTS (Unaudited) Fourth Twelve months ended Quarter December 31, 2003 2004 2003 OPERATING EARNINGS Net income $7,446,706 $30,950,260 $26,699,330 Amortization of intangible assets, net 76,896 365,460 240,569 Job reductions - 231,845 - Contract buyout, net - 172,366 - Systems write-offs, net - 342,104 - Operating income $7,523,602 $32,062,035 $26,939,899 Operating earnings per share Basic $0.40 $1.65 $1.51 Diluted $0.38 $1.60 $1.45 Average tangible assets (in thousands) $1,851,095 $2,031,505 $1,641,991 Average tangible equity (in thousands) 101,334 116,444 106,275 Operating return on average tangible assets 1.63% 1.58% 1.64% Operating return on average tangible equity 29.70% 27.53% 25.35% OPERATING BASIS Non-interest expense $14,519,860 $62,064,003 $52,578,047 Net interest income 19,340,399 82,409,322 71,369,711 Non-interest income 6,896,440 30,622,032 24,343,791 Efficiency Ratio 55.34% 54.91% 54.93% PRNewswire-FirstCall -- Jan. 19 END FIRST AND FINAL ADD DATASOURCE: Main Street Banks, Inc. Web site: http://www.mainstreetbank.com/