First South Bancorp, the parent holding company of First South, reports its unaudited operating results for the quarter and year ended Dec. 31, 2011.

For the 2011 fourth quarter, net income increased 9.4 percent to $441,000 or $0.05 per diluted common share, from net income of $403,000 or $0.04 per diluted common share earned in the linked 2011 third quarter, compared to a net operating loss of $6.5 million or ($0.67) per diluted common share for the 2010 fourth quarter.

Net income for the year ended Dec. 31, 2011, increased to $1.6 million or $0.16 per diluted common share, compared to a net operating loss of $2.4 million or ($0.24) per diluted common share for the year ended Dec. 31, 2010.

Tom Vann, president and CEO, commented, “I am pleased to report the company’s operating results for the fourth quarter of 2011. The company continues to generate solid core earnings. Fourth quarter 2011 net earnings were $441,000, after recording $2.6 million of credit loss provisions. In the 2011 fourth quarter, we continued evaluating the credit quality of the bank’s loan portfolio and market values of foreclosed properties. While the volume of our nonperforming assets increased during 2011, based on our current analysis we continue to remain cautiously optimistic about the financial stress some of our borrowers are facing. Consequently, we are provisioning accordingly to replenish net charge-offs and to maintain our allowance for loan and lease losses at an adequate level. Mitigating our nonperforming assets will continue to be a top priority for the bank during 2012.