742054--3/29/2010--CADENCE_FINANCIAL

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{stock, price, share}

{condition, economic, financial}

{debt, indebtedness, cash}

{loss, insurance, financial}

{financial, litigation, operation}

{loan, real, estate}

{acquisition, growth, future}

{tax, income, asset}

{product, liability, claim}

{system, service, information}

{personnel, key, retain}

{competitive, industry, competition}

{regulation, government, change}

{capital, credit, financial}

The current economic environment poses significant challenges for us and our industry and could adversely affect our financial condition and results of operations. We are heavily regulated, and that regulation could limit or restrict our activities and adversely affect our earnings. We have entered into a formal written agreement with the OCC that requires us to take specified actions. We are required to maintain high capital levels We are required to maintain high capital levels. Our loan portfolio is highly concentrated in commercial real estate in certain geographic areas. The level of our commercial real estate loan portfolio has subjected us to additional regulatory scrutiny. Our allowance for loan losses may not be adequate to cover actual losses. We are subject to restrictions on executive compensation as a result of our participation in the CPP. Competition in the banking industry is intense and may adversely affect our profitability. Operating results may require us to raise additional capital, but that capital may not be available or may be dilutive. Liquidity needs could adversely affect our results of operations and financial condition. The preferred stock sold to the U. S. Treasury may impact net income available to our common shareholders, and the warrant may be dilutive to our common shareholders. We may not be permitted to repurchase the U. S. Treasury s CPP investment if and when we request approval to do so. If we are unable to repurchase the U. S. Treasury s investment after five years, the cost of this capital will increase substantially. We face litigation and legal liability risks. Actions of the U.S. Treasury, the Federal Reserve and other governmental and regulatory bodies for the purpose of stabilizing the financial markets may not achieve the intended effect. Changes in monetary policy and interest rates could adversely affect our profitability. We may be required to pay significantly higher FDIC premiums in the future. We are a bank holding company and depend on our subsidiaries for dividends, distributions and other payments. Our inability to hire or retain key professionals, management and staff could adversely affect our revenues and net income. An interruption or breach in security with respect to our information systems, as well as information systems of our outsourced service providers, could have a material adverse effect on our financial condition and results of operations. We have a significant deferred tax asset and cannot assure that it will be fully realized.

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742054--3/29/2010--CADENCE_FINANCIAL_CORP