PARKERSBURG, WV--United Bankshares, Inc. (NASDAQ: UBSI), today reported record earnings for the third quarter and the first nine months of 2002. Net income was $22.4 million for the third quarter of 2002, up 13% from $19.8 million earned during the third quarter of 2001. Diluted earnings per share were 52¢ for the third quarter, up 8% compared to 48¢ per share for the third quarter of 2001. Net income for the first nine months of 2002 was $66.4 million or $1.53 per diluted share, which was also an increase of 13% compared to $58.9 million or $1.41 per diluted share for the prior year's first nine months.

United's return on average assets was 1.58% for the quarter, up from 1.55% in the third quarter of 2001. Return on average equity was 16.37% for the third quarter of 2002 compared to 17.31% for last year's third quarter. For the nine months ended September 30, 2002, United achieved an annualized return on average assets of 1.60% and an annualized return on average equity of 16.85% compared with 1.59% and 17.57%, respectively, for the same time periods in 2001. These key financial performance ratios are indicative of United's earnings strength and balanced capital levels. United continues to be one of the best performing regional banking companies in the nation.

Tax-equivalent net interest income for the third quarter of 2002 was $56.5 million, an increase of $7.0 million or 14% from the third quarter of 2001. Tax-equivalent net interest income for the first nine months of 2002 was $164.1 million, an increase of $18.4 million or 13% from the prior year's first nine months. The net interest margin for the third quarter of 2002 was 4.26% which is 12 basis points higher than the previous year's third quarter net interest margin of 4.14%. For the first nine months of 2002, the net interest margin was 4.22%, which is 8 basis points higher than the same period in 2001. The margin increases from last year's results were primarily attributable to a decrease in funding costs and an increase in average earning assets due mainly to the Century Bancshares acquisition that was consummated in December of 2001. The cost of interest-bearing funds declined 133 and 152 basis points for the quarter and year-to-date, respectively, when compared to the same periods in 2001. On a linked quarter basis, tax-equivalent net interest income increased $2.3 million or 4% while the net interest margin increased 4 basis points from the second quarter of 2002. These increases were the result of a higher level of loans held for sale and the associated interest income earned until settlement, plus an 18 basis point decline in the cost of interest-bearing deposits. In addition, United received a $1.1 million dividend payment plus interest during the quarter on a $10 million trust preferred security previously classified as nonaccrual.

Noninterest income, excluding security transactions, for the third quarter of 2002 was $23.1 million, which represented increases of 41% and 32% from the third quarter of 2001 and second quarter of 2002, respectively. These results were achieved primarily due to increased revenues from the mortgage banking segment. Income from mortgage banking operations increased $3.9 million or 53% for the third quarter of 2002 as compared to the third quarter of 2001. On a linked-quarter basis, mortgage banking income increased $4.1 million or 57%. Noninterest income, excluding security transactions, for the first nine months of 2002 increased $11.1 million or 24% from the same time period in 2001 primarily due to increases of $5.8 million and $3.9 million in mortgage banking income and deposit services fees, respectively. Including security transactions, noninterest income increased 19% and 16% for the third quarter and first nine months of 2002, respectively, when compared to the same time periods in 2001. Included in the security transactions' totals for 2002 and 2001 are recognized impairment charges of $5.4 million and $1.2 million, respectively, related to an other-than-temporary decline in the fair value of retained interests in securitized assets for the nine months ended September 30, 2002 and 2001. This decline was the result of an increase in the level of prepayment and default activity during the time periods, which effected the valuation of those securities.

Noninterest expense increased 34% and 24% for the third quarter and first nine months of 2002, respectively, compared to the third quarter and first nine months of 2001. These increases from last year were mainly due to increased employee salaries and benefits from the Century Bancshares acquisition in December of 2001, which more than offset the reduction in goodwill amortization expense related to a change in accounting rules effective January 1, 2002. On a linked-quarter basis, noninterest expense was up 11% over the second quarter of 2002 due mainly to higher sales activity in the mortgage banking segment as compensation and incentives for its personnel are significantly tied to activity levels. The efficiency ratio was still a low 47.64% and 46.88% for the third quarter and first nine months of 2002, respectively. This ratio compares very favorably to regional and national peer group banking companies.

United's credit quality continues to be sound. Nonperforming loans were $12.9 million at September 30, 2002, as compared to $15.0 million at June 30, 2002 and $17.6 million at December 31, 2001. At quarter end, nonperforming loans represented 0.36% of loans, net of unearned income. The provision for loan losses for the three months ended September 30, 2002 amounted to $1.8 million compared to $4.1 million for the same period in 2001. The provision for loan losses for the nine months ended September 30, 2002 was $5.7 million compared to $8.8 million for the prior year-to-date. Net charge-offs were $2.2 million for the third quarter of 2002 which was a decline from net charge-offs of $2.8 million for the prior year quarter. Net charge-offs for the first nine months of 2002 were $5.8 million, a decrease from net charge-offs of $6.8 million for the first nine months of 2001. As of September 30, 2002, the allowance for loan losses was $47.4 million or 1.33% of loans, net of unearned income, compared to 1.35% at December 31, 2001.

During the quarter, United's Board of Directors declared a cash dividend of 24¢ per share, which represented a 4% increase over the 23¢ paid in both the second quarter of 2002 and the third quarter of 2001. The annualized year-to-date dividend of 70¢ per share equals 93¢, which would represent the twenty-ninth consecutive year of dividend increases for United's shareholders.

United Bankshares, with $5.8 billion in assets, presently has 85 full-service offices in West Virginia, Virginia, Maryland, Ohio, and Washington, D.C. United Bankshares stock is traded on the NASDAQ (National Association of Securities Dealers Quotation System) National Market System under the quotation symbol "UBSI".

This press release contains certain forward-looking statements, including certain plans, expectations, goals and projections, which are subject to numerous assumptions, risks and uncertainties. Actual results could differ materially from those contained in or implied by such statements for a variety of factors including: changes in economic conditions; movements in interest rates; competitive pressures on product pricing and services; success and timing of business strategies; the nature and extent of governmental actions and reforms; and rapidly changing technology evolving banking industry standards.