Coastal Financial Corporation Announces Fiscal 2007 First Quarter Earnings.

MYRTLE BEACH, S.C. -- Coastal Financial Corporation (NASDAQ:CFCP) today announced earnings for the first fiscal quarter ended December 31, 2006.

Net income for the first quarter of fiscal 2007 increased 9.9% to $4.9 million or $0.23 per share ($0.22 per share diluted), as compared to $4.4 million or $0.21 per share ($0.20 per share diluted) for the same period of fiscal 2006.

At December 31, 2006, assets totaled $1.66 billion, an increase of 5.1% from $1.58 billion at December 31, 2005. During the same period, Customer Deposits (excluding brokered deposits) increased 3.5%, from $861.7 million to $891.4 million, and net loans receivable increased 11.1%, from $981.9 million to $1.1 billion. In comparing the first quarters of fiscal 2006 and 2007, net interest income after provision for loan losses grew 5.9% to $13.6 million.

Returns on average assets and average equity were 1.18% and 17.1%, respectively, for the three months ended December 31, 2006, as compared to 1.14% and 18.1% for the comparable period in fiscal 2006.

At December 31, 2006, asset quality continued to be good with non-performing assets to total assets of 0.33% as compared with 0.31% at December 31, 2005.

Michael C. Gerald, President and Chief Executive Officer of Coastal Financial Corporation, said, "We are very pleased with the performance of Coastal Financial Corporation for the first quarter of fiscal 2007, particularly given the strong competition for deposits and loans and difficult interest rate environment."

"During the first quarter of fiscal 2007, we announced a $.05 per share cash dividend, an 11.8% increase in fiscal 2006 diluted per share net income, and the signing of a definitive merger agreement with BB&T Corporation."

Coastal Financial Corporation, headquartered in Myrtle Beach, South Carolina, offers a broad range of commercial, consumer and mortgage financial services through two subsidiaries, Coastal Federal Bank and Coastal Retirement, Estate and Tax Planners, Inc. Coastal Federal Bank, with assets of $1.7 billion, is a federally chartered and FDIC insured community bank with twenty-four offices serving the communities of Horry and Georgetown Counties, South Carolina and Brunswick and New Hanover Counties, North Carolina. Coastal Retirement, Estate and Tax Planners offers professional, objective, fee-based financial planning services. Additional information about Coastal Federal is available on its web site at www.coastalfederal.com.

Stock Trading Information

The common stock of Coastal Financial Corporation is traded on the Nasdaq Stock Market under the symbol "CFCP." For information, contact Raymond James Financial Services at 1-843-918-7600.

Dividend Reinvestment and Direct Stock Purchase Plan

Coastal Financial Corporation offers Shareholders a Dividend Reinvestment and Direct Stock Purchase Plan which provides existing and new shareholders a convenient means for making purchases of Coastal Financial shares free of fees and brokerage commissions. Additional cash contributions, up to $1,000 per quarter, can be made to purchase additional shares. For more information, contact the Transfer Agent at 1-800-866-1340, Ext. 2514, or Investor Relations.

Shareholder Services

Shareholders desiring to enroll in the Coastal Financial Corporation Dividend Reinvestment Plan, change the name, address, or ownership of their stock certificates, report lost or stolen certificates, or to consolidate accounts should contact the Transfer Agent at 1-800-866-1340, Ext. 2514, or Investor Relations.

Investor Relations

Analysts, investors and others seeking financial information should contact:

Susan J. Cooke - Senior Vice President and Secretary







Coastal Financial Corporation







2619 Oak Street







Myrtle Beach, South Carolina 29577







[phone]

Forward Looking Statements

This report may contain certain "forward-looking statements" within the meaning of Section 27A of the Securities Exchange Act of 1934, as amended, that represent the Company's expectations or beliefs concerning future events. All forward-looking statements are based on assumptions and involve risks and uncertainties, many of which are beyond the Company's control and which may cause its actual results, performance or achievements to differ materially from the results, performance or achievements contemplated by the forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate" or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could" or "may." Forward-looking statements speak only as of the date they are made. Such risks and uncertainties include, among other things:

* Competitive pressures among depository and other financial institutions in the Company's market areas may increase significantly.

* Adverse changes in the economy or business conditions, either nationally or in the Company's market areas, could increase credit-related losses and expenses and/or limit growth.

* Increases in defaults by borrowers and other delinquencies could result in increases in the Company's provision for losses on loans and related expenses.

* The Company's inability to manage growth effectively, including the successful expansion of the Company's Customer support, administrative infrastructure and internal management systems, could adversely affect the Company's results of operations and prospects.

* Fluctuations in interest rates and market prices could reduce the Company's net interest margin and asset valuations and increase expenses.

* The consequences of continued bank acquisitions and mergers in the Company's market areas, resulting in fewer but much larger and financially stronger competitors, could increase competition for financial services to the Company's detriment.

* The Company's continued growth will depend in part on its ability to enter new markets successfully and capitalize on other growth opportunities.

* Changes in legislative or regulatory requirements, or actions by the Securities and Exchange Commission ("SEC"), the Financial Accounting Standards Board ("FASB"), or the Public Company Accounting Oversight Board, applicable to the Company and its subsidiaries could increase costs, limit certain operations and adversely affect results of operations.

* Changes in tax requirements, including tax rate changes, new tax laws and revised tax law interpretations may increase the Company's tax expense or adversely affect its Customers' businesses.

* Company initiatives now in place or introduced in the future, not producing results consistent with historic growth rates or results which justify their costs.

In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements in this report. Except as may be required by applicable law or regulation, the Company undertakes no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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