August 29, 2002

Reporters may contact:
Tom Adams at State Bank (979) 968-7261
tom.adams@statebanktx.com

LA GRANGE – Texas United Bancshares, Inc. (Nasdaq: TXUI) today reported second quarter 2002 net income of $1.3 million or $0.50 per diluted share, an increase of $257,000 from $0.40 per diluted share compared to the second quarter of 2001. Reported annualized return on average assets was 1.22% and annualized return on average equity was 18.5%. For the first six months of 2002, net income was $2.7 million or $1.03 per diluted share, up from $0.74 per diluted share earned in the first half of 2001. Reported annualized return on average assets was 1.27% and annualized return on average equity was 19.3% for the first six months of the year.

"Texas United Bancshares had a strong second quarter, culminating with the successful acquisition of The Bryan-College Station Financial Holding Company of Bryan, Texas for $2.6 million on July 31, 2002," said Don Stricklin, President and Chief Executive Officer. "Completion of this transaction brings the number of full service banking centers operating under our wholly owned subsidiary State Bank in greater central and south central Texas to 17, giving us an additional presence in the stable, dynamic Bryan-College Station market."

Other financial results for the quarter included net interest income, before the provision for loan losses, of $5.2 million in the second quarter of 2002, up 23.8% for the second quarter 2001. For the first six months of 2002, net interest income, before the provision for loan losses, was $9.8 million, up 22.5% from the first half of 2001. The net interest margin for the second quarter of 2002 was 5.29%. Average total loans, including loans held for sale, for the second quarter 2002 were up $25.9 million from the second quarter last year. Average deposits for the second quarter were up $26.2 million, a 7.6% increase from a year ago.

More than ever, families and businesses from a diverse range of Texas communities are choosing State Bank™ as their financial partner. In banking with us, they know they are more than just a number and that real people committed to serving their needs is what State Bank™ is all about. Caring, working and delivering, not just once in a while, but every day for every customer.