First United Corporation
2001 Annual Report
Table of Contents		    
 
 
 
Strategic Profile		  
 

     In the first year of the new century, First United Corporation posted record earnings of$9,169,403, resulting in earnings per share of $1.51. This compares very favorably with 2000 earnings per share of $1.37. Despite numerous decreases in interest rates, the company was actually able to improve its net interest margin from 3.79% to 3.86%. (Essentially, the net interest margin is the difference between the rate paid to depositors and the rate charged to borrowers.) Return on Equity moved from 13.40% in 2000 to 13.26% in 2001.
   
  Market Value of Stock Improves
       The equities market favored First United Corporation (FUNC) with outstanding performance as shares rose from $10.38 per share on December 31, 2000, to $16.00 per share at the end of 2001 Even with this performance, the value of the shares is still discounted when compared to peer groups with similar performance.
   
  Commercial Lending Up 22%
     While loans, as a whole, did not meet our growth projections, another stellar year was turned in by the commercial lending group. Commercial loans grew by $37.87 million, or 22.44% during 2001. This represents a diverse blend of loans throughout the market area served by the Bank. Even with the growth of this portfolio over recent years, the asset quality of the portfolio continues to be stronger than national indices and peer statistics. The breadth of services available to our commercial customers continued to expand as our Cash Management Services moved into full swing. This segment now boasts 153 customers and balances in excess of $30 million. Another good year was also enjoyed by "Business Manager," our accounts receivable product, as revenues grew from $367,000 in 2000 to $604,000 in 2001; an increase of 64%. With a competent staff of professionals strategically placed throughout our market area, we are positioned to continue our strong growth in this area in coming years.
 
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