COOPERATIVE BANKSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
		Three Months Ended						Twelve Months Ended
		December 31,						December 31,
		2005			2004			2005			2004
Interest and dividend income:
Loans	$	10,935,119		$	6,739,572		$	36,761,753		$	25,185,437
Securities		514,612			542,367			2,107,163			2,218,150
Other		95,770			19,313			171,612			49,436
Dividends on FHLB stock		62,774			39,412			217,490			150,172
Total interest and dividend income		11,608,275			7,340,664			39,258,018			27,603,195
Interest expense:
Deposits		3,851,047			1,811,664			12,001,466			6,425,637
Borrowed funds		1,362,685			701,783			4,157,410			2,779,271
Total interest expense		5,213,732			2,513,447			16,158,876			9,204,908
Net interest income		6,394,543			4,827,217			23,099,142			18,398,287
Provision for loan losses		935,000			225,000			2,485,000			970,000
Net interest income after provision for loan losses		5,459,543			4,602,217			20,614,142			17,428,287
Noninterest income:
Gain on sale of loans		526,623			563,672			2,421,946			2,523,246
Net gain on sale of securities		-			9,600			-			9,600
Service charges and fees on loans		120,077			154,529			772,001			505,986
Deposit-related fees		498,318			414,270			1,802,838			1,591,762
Gain (loss) on disposal of premises and equipment		428,324			-			428,324			-
Bank-owned life insurance earnings		95,283			73,182			348,481			317,377
Other income, net		36,427			70,057			173,491			235,557
Total noninterest income		1,705,052			1,285,310			5,947,081			5,183,528
Noninterest expense:
Compensation and fringe benefits		2,609,408			2,266,764			10,371,057			9,322,226
Occupancy and equipment		924,148			794,167			3,550,056			3,262,622
Professional and examination fees		76,030			148,532			446,881			460,084
Advertising		169,659			141,895			573,852			525,341
Real estate owned		0			0			0			0
Other		783,644			495,354			2,359,965			2,016,063
Total noninterest expenses		4,562,889			3,846,712			17,301,811			15,586,336
Income before income taxes		2,601,706			2,040,815			9,259,412			7,025,479
Income tax expense		1,144,588			688,122			3,757,874			2,344,304
Net income	$	1,457,118		$	1,352,693		$	5,501,538		$	4,681,175
Net income per share:
Basic*	$	0.34		$	0.32		$	1.28		$	1.09
Diluted*	$	0.33		$	0.31		$	1.26		$	1.07
Weighted average common shares outstanding:
Basic*		4,304,214			4,291,146			4,298,561			4,289,187
Diluted*		4,386,369			4,369,425			4,376,281			4,366,478
*The 2004 information is computed after giving the retroactive effect of a 3-for-2 stock split in the form of a 50% stock dividend
declared on January 19, 2005 and paid on February 24, 2005.