Welcome to today's F.N.B. Corporation Third Quarter 2007Earnings Conference Call. At this time, all participants are in a listen-onlymode. Following the presentation, we will conduct aquestion-and-answer session. Instructions will be provided at that time for youto queue up for questions. As a reminder, today's conference is being recorded. And now, I’d like to turn the conference over to Mr. BartleyParker with Investor Relations. Please go ahead, sir.

Thank you, Trisha. This conference call of F.N.B.Corporation and the reports it files with the Securities and ExchangeCommission. Often contains forward-looking statements, which are based oncurrent expectations, estimates, forecasts, and projections about F.N.B. As well as management's assumptions and beliefs, relating topresent or future trends or factors affecting the future performance of F.N.B.and the banking and financial services industry. Since forward-lookingstatements relate to future developments, results, and events. They often --they involve certain risks and uncertainties. Actual results may differ materially from historicalperformance or those expressed or implied in the presentation as a result offuture decisions by F.N.B. or by other factors and developments beyond F.N.B.'scontrol. Including, but not limited to a significant increase incompetitive pressures among financial institutions; changes in interest rateenvironment that may reduce interest margins; changes in prepayment speeds, loansale volumes, charge-offs, and loan loss provisions; less favorable thanexpected general economic conditions; legislative or regulatory changes thatmay adversely affect the business in which F.N.B. is engaged; technologicalissues which may adversely affect F.N.B.'s financial operations or customers;changes in the security markets; or risk factors mentioned in F.N.B.'s filingswith the Securities and Exchange Commission. F.N.B. undertakes no obligation to update theseforward-looking statements or to reflect events or circumstances after the dateof this call. It is now my pleasure to turn the call over to Mr. StephenGurgovits, President and CEO. Steve?

Thank you, Bartley. Good morning, everyone, and thank youfor joining our third quarter 2007 earnings conference call. With me today onthe call is Brian Lilly, our Chief Financial Officer; and Gary Roberts,President and CEO of First National Bank of Pennsylvania. Before we begin our review of the third quarter, I would beremiss in not mentioning our announcement earlier this week that Robert New,Jr., has been selected as the next President and Chief Executive Officer ofF.N.B. Corporation. Bob comes to us from Houston, Texas, and has nearly 34 yearsof banking experience. Our recent press release elaborates on Bob's backgroundand experience, which I won't repeat now. Bob will join us on January 15, 2008,as President and CEO-elect, then will become President and CEO on April 1,2008. I will remain thereafter on a full time basis as Chairmanfor the remainder of 2008. Beginning in 2009, I will remain as Chairman andwill have a part time advisory role for an additional five years. I wish tothank our Board and in particular our succession committee for their hard work. I announced my retirement plans well in advance in order toallow sufficient time to select a CEO and execute a smooth, seamless transferof leadership. I believe our plan will work perfectly. I look forward tointroducing Bob New to you on our next earnings call. Now to the third-quarter review, for the third quarter of2007, we earned $0.29 per diluted share, comparable to both the prior quarterand the third quarter of last year. We delivered strong profitability with areturn on tangible equity of over 26% and a return on tangible assets of 1.25%. Our returns continue to place F.N.B. in the top quartile ofour national peer group. Our results for the third quarter reflect our abilityto deliver on key objectives. We grew the average balances of our…

Thank you, Steve, and good morning, everyone. I would liketo start with some comments on our loan portfolio. Loan growth was the keycontributor to our 6.4% annualized growth in net interest income. In particular, average commercial loans increased 11%annualized, compared to the second quarter of 2007. This growth reflected ourstrategy to grow these high-yielding relationship based loans. Regarding the growth in our direct installment portfolio, asuccessful sales campaign in late spring and early summer accelerated thenormal seasonal strength, resulting in an average balance increase of $28million or 12% annualized, relative to the second quarter. In total, our average loans grew 7.7% annualized over thesecond quarter of 2007. Balances of investment securities were comparable tothe second quarter, thereby generating average earning asset growth of 3.9%annualized. We continue to be comfortable with the level of ourinvestment securities, relative to our total assets. Our growth in net interestincome for the third quarter benefited from a stable net interest margin. Weare pleased that this marked the fourth consecutive quarter of a stable margin,particularly against the challenges of an inverted yield curve. The yield onearning assets and cost of funds increased 5 basis points on asequential-quarter basis. On the asset side, yields have been enhanced throughgrowth in commercial loans. Regarding deposits, which represent 86% of total funding,we've reduced balances of higher-cost CDs and increased our lower-cost coredeposits. The acceptance of our innovative banking products continues to helpdrive increased lower-cost core deposits. With the new development officers ineach of our five regions also contributing to these results. In total, average deposits and treasury management productsincreased 3.7% annualized from the second quarter of 2007. Period end balanceswere slightly higher than our average balances, giving us nice momentum headinginto the fourth quarter. Deposit rates offered to our customers were relativelyflat during the third quarter, but have declined subsequent…

Thank you, Brian. In terms of our earnings guidance for theremainder of the year, Brian has highlighted a few of the important components.As a result of our expectation of covering our net loan charge-offs with ourprovision, we now expect earnings for the full year 2007 to be in the range of$1.16 to $1.17 per share. This represents expected earnings growth of 2% to 3% overthe full year 2006. We are pleased with this performance given the interestrate and credit quality challenges faced by the financial service industry. In closing, we are proud to have announced a 2.1% increasein our dividend in August. We believe this reflects the Board's confidence inthe outlook for the Corporation's earnings and capital position. This also putsus on track to make 2007 the 35th consecutive year of growth in our cashdividend. We believe our sound strategy of profitably managing ourbusinesses and providing value to our shareholders in the form of a low riskprofile and strong cash dividend makes us an attractive investment choice. Wethank all of our shareholders for their continued support. Well, that concludes our formal remarks for the call. I willnow ask the operator to poll the audience for any questions.

(Operator Instructions) And we’ll go first to David Darstwith FTN Midwest.

Good morning.

Good morning, David.

Hi David.

Do you feel like the run-off that you were managing in theindirect in the residential portfolio is complete? Is that going to translateinto a little bit better loan growth for the overall portfolio going forward?

I think, let me take those one at a time. On the mortgageportfolio, as you know, we continue to sell most of our production; but thereis a component that is reaching in there that is stabilizing. I think we will continue to see the $8 million a quarter,barring some unusual opportunities, to slide off. On the indirect portfolio, David, I think we have stated inthe past the credit quality continues to be excellent. We are happy with theyields that we're getting there. But it’s not a long-term strategy for us. Butcertainly, that is a place of liquidity as we continue to build the commercialportfolio going forward.

Okay. Then, on the securities portfolio, do you expect togrow that a little bit to maintain the ratio, you said 80, 20 to loans tosecurities average earning assets?

Well, the ratio should be relatively steady going forward,although we’ll look for opportunities to keep a little investment securities aspossible. We build that need up from the bottom based on our liquidity needsand our pledging requirements and our interest rate risk needs.

Okay. And then, could you give us the balance of yourresidential construction portfolio? How much of that is in Florida, and howmuch is in the Pennsylvania market?

Well, actually, David, we have very little residential constructionin the north at all. I mean, we may have an occasional owner-builder, but wedon't have any tract residential development or anything of significance in thenorth.

So, is that the residential properties that are in Floridathat are giving you concern?

Well, to make a comment about Florida, David, about a thirdof our involvement in Florida, in terms of development is commercial in natureand two-thirds would be residential. And we’re obviously aware of the softening in the market. Wethink that may slow the absorption rate on some of these developments. Buthaving said that, as I have mentioned in previous calls, they were wellunderwritten. A lot of these have 50%, 60% loan-to-value ratios, often withguarantors. Most of them have pretty good personal liquidity. So. But having said that, we are aware that the market hassoftened and so we’re looking pretty closely at all 51 loans in the portfolioand in making sure that we are where we need to be.

Steve, are your loans, the infrastructure like the roads andthe pipes? Or are you also doing the actual houses?

No, not really. We’re not doing the tract building downthere. We have, I would say, David, I would carve this into three buckets ifyou will, and they're almost equal. One is, outright land acquisition while anaccumulation, while this real estate is being permitted and going through thatprocess. And if you are familiar with Florida, that is a prettyextensive, lengthy process. Then, we have another bucket that I have alwaysreferred to as horizontal construction, which is the roads and theinfrastructure, utility, sewers, that sort of thing, curbing, paving. And then the other third of the portfolio is pretty much thecommercial projects, office buildings, retail centers, that type of thing.

Okay. And then…

But no housing construction.

Okay. And last quarter, you indicated that there were nopast dues or NPAs. Is that still the case in Florida?

Well, actually as of September 30, David, that is not thecase. We did have one loan, one of the 51, that was delinquent as of September30; and in fact we put it on non-accrual. It happens to be a $2.6 million loanthat has a $650,000 specific reserve assigned to it, which we think is adequateto cover the risk of any loss in that particular credit.

David, as you see, we were able to cover that withimprovements in our other portfolios, so it really didn't move thenon-performing assets all that much.

Okay. Great. Thank you.

And we’ll go next to Mac Hodgson, SunTrust RobinsonHumphrey.

Good morning.

Good morning, Mac.

Some of my questions were already answered. I guess stayingon Florida for a second, what are the total outstanding balances on the loanbalances for the Florida portfolio?

On September 30, they were about $246 million.

Okay, $246 million; and you had mentioned?

Actually $246.5, to be specific.

Okay, great. You mentioned about two-thirds of that isrelated to residential?

No. Two-thirds of that is related to, well, if you put allthree buckets together, you about two-thirds would be about residential, aboutone-third would be commercial in nature.

Okay. The increase in the reserve, obviously, I think youjust mentioned $650,000 is a specific reserve allocated to that $2.6 millioncredit. Was there kind of just unallocated reserves? Or are the other increasein reserves related to specific credits down there that have deteriorated?

No, not to specific credits. But in our loan modeling, we dohave economic and general allocations. We saw it prudent to allocate some tothe Florida economy, if you will. And so we had, and our specific reservesactually netted out with all of our portfolios. So, the increase was primarilydriven by us putting some to a general Florida condition.

Okay, got you. What about, I know it’s a small piece of theoverall portfolio, but how is the Regency portfolio performing, any weaknessthere?

I would not call it a weakness, Mac. But if you recall, justfor the history, back in the fourth quarter of '05, with the new bankruptcylaw, it went into effect, I believe, in October of that quarter. And thataccelerated a lot of their charge-offs into the fourth quarter of '05. And thenin '06, they had a, for Regency, a below normal run rate of delinquency andlosses. We had fully expected that to return to normal levels at thebeginning of this year, which as a matter of fact it didn't, it was stillrunning below their historical averages. But our prediction for Regency is thattheir portfolio will return to more normal levels.

Just, Mac, to give you some numbers on that, we see ournormal levels to be in the 4s, on an annualized net charge-off basis; on aquarterly 4.5, low 4s.

Okay.

And for the last couple of quarters, we've been averagingright about 3%, with the third quarter getting up around 3.5%. So we think thetrend is to get us back up into the 4s as we look forward.

Okay, got you. It's a pretty small portfolio, right? What'sthe total outstanding on that?

About 150.

150? Okay. And on the -- any kind of tax rate expectationsyou can give us for the fourth quarter? I think you mentioned and without the benefitthis quarter it would have been about 29.6%.

I would say you're right in that same range, somewherearound 30% number.

Okay. Okay, great. Thanks, guys.

We'll next go to Damon DelMonte with KBW.

Hi, good morning. Most of my questions have been answered.Just a couple of detail questions, could you just go over the numbers again onthe Pittsburgh production that you've seen so far this year?

Yeah, the production is $103 million versus annual goal of$125 million.

Okay, great. And then with respect to the Floridaoperations, I believe there was a few vacancies that you had down there. Wereyou guys able to fill those yet?

We filled one -- this is Gary, we filled one position in theTampa area.

Okay. And any further thoughts on actually opening upbranches for deposit-gathering efforts down there or are you still solelylooking at the Florida operations as LPOs?

At this moment, we have just the LPO operation, but as I'vestated on other calls, we do from time to time study what our next opportunityshould be. But at this particular moment, we're only focused on building outthe LPOs and adding some additional services like treasury management and soforth through those LPO offices.

Okay, great. Thank you very much.

We'll go next to Charlie Smith with Fort Pitt Capital.

Good morning.

Good morning, Charlie.

I'm kind of glad, actually glad to hear that you guys didn'tmeet your loan targets in Florida. We may be overly focused on Florida. Arethere any segments of your PA markets in terms of your customer list, certainindustries, where you're seeing any signs of weakness?

Not really, Charlie. Just to -- and I don't want to go backto Florida necessarily, because that wasn't your question, but I'll do that inorder to lead into your question. When we started this year, we had a target in Florida withabout $350 million. And with the softening in the market, early on in the firstquarter, we said we really don't want to do $350 million. So we cut it back toabout $225 million, and we'll probably be at or around that this year as wetightened our underwriting substantially. But if you go up to the North, and the different regions inPennsylvania and Eastern Ohio that we're in, we feel pretty comfortable withnot only our production, but our asset quality is really holding up, and thenwe're meeting our production goals. So, Harrisburg should be pretty close to their goal,Pittsburgh be close to maybe slightly over. And the rest of the northernfranchise is pretty much where we want it to be.

I think the M&A activity up here has helped us some, andwe've had some micromarketing, what we call micromarketing campaigns in thoseparticular areas. And we've met, as Brian noted in his comments of growth,we've met with some success in growing core deposits and loans. So, the North is really what we call the North, and thebasic footprints really carried the year for us.

Okay. Assuming that it's going to be at least four to sixquarters for real estate to sort things out, both commercial, I think we'rejust starting to see some signs of pain around the edges in commercial realestate in some places. Assuming six to eight quarters from now, we bought themout, where do you think your net charge-offs percentage could be?

Oh wow, Charlie. I think you would be asking us to speculateunder a whole bunch of assumptions. I don't think we can go there.

Okay, so --

But Charlie, remember as I said earlier, on these loans inFlorida, particularly the residential loans, we're often in there at 50% or 60%of what the appraised value was. Now we understand if the market softens, theappraised value can soften as well. But in addition to that, most of these loans have personalguarantees and the guarantors on these loans. We look at them for not onlytheir contingent liabilities on other projects, but specifically to theliquidity on their balance sheet. So, I'm not going to sit here and say, well, I don't knowwhat the future holds. But I can tell you that the best thing you can do inadministering credit is to stay on top of these things, and believe me, ourguys are tracking these 51 credits. Yeah, the good news is it's only 51credits.

Yeah, exactly. Okay, thanks a lot.

Sure.

(Operator Instructions) We'll go next to Jim Gifulo withBantar Advisors (ph).

Gentlemen, I missed the very first part of the conferencecall, and I was hoping you could give a little more detail on Mr. New'scredentials and what he has been doing up until now.

Well, I don't have his resume in front of you. I would referyou to our press release early in the week for probably more specifics. But atthe beginning of the call, I just mentioned that we did hire Mr. New. Thisweek, we announced it Monday afternoon. He is, I think will be 56 years old next week. He has beenin the banking business, literally his whole life he has about 34 years, goingon 35 years experience. He is a California native. He has been in the Texas banking market, starting out withTexas Commerce Banks where he was a CEO of several of their different affiliatebanks. Once was with NationsBank, which became, as you know, Banc of America.With Coast Bank, which was acquired by Hibernia, he was Executive VicePresident of that bank. For about the last 18 to 20 months, he joined an investorgroup, who enticed into joined them and start a bank that is called GreenBancorp in Houston, Texas. It was a startup. It's up to about around number,$250 million or so in assets. And he was not looking for a job. He was contacted byHeidrick & Struggles, who we had retained as a recruiting firm and afterseveral contacts, they got him to at least sit down and talk to us, and it wentfrom there. But he and his wife are moving to the community and heexpects to be active in the community and I think he has got a good backgroundof operations and lending. He has had the mix of the larger bank any thesmaller community bank and I think personality-wise and experience-wise, hewill fit the culture of this company pretty nicely.

(Operator Instructions) And we've no further questions leftin the queue. I would like to turn the call back over to Mr. Gurgovits, for anyadditional or closing remarks.

Thank you. And thank all of you again for joining us today.Telephone replay for this call will be available through November 2nd bycalling 888-203-1112 and entering the confirmation number 1434076. As usual, the transcript of today's call will be posted tothe investor relations section of our website, which can be reached atwww.fnb.corporation.com. Thanks again for your participation and have a greatday.

Thank you, ladies and gentlemen, for your participation ontoday's conference call. You may disconnect at any time.