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FOR IMMEDIATE RELEASE

Contact: John Wilkinson
Marketing Director, Lone Star Bank
512/201-3235
jwilkinson@lonestarbank.com

Southern Bancshares Consolidates Holdings, Creating SouthStar Bank, S.S.B.

The new alliance between commonly-owned banks will strengthen market presence, boost lending capabilities, standardize products, and reinforce our commitment to exceptional customer service while centralizing management and reporting for improved efficiency.

September 25, 2014─Houston, TX─Southern Bancshares, Inc., a Houston, TX-based financial services holding company and majority owner of Lone Star Bank, First Star Bank, and Texas Star Bank – all State Savings Banks (S.S.B.) – has reached a definitive agreement to consolidate the three organizations under a new name: SouthStar Bank, S.S.B. All three banks enter the consolidation with a 5-Star rating by industry analyst BauerFinancial (www.bauerfinancial.com). Shareholders have approved the consolidation. Regulatory approval is expected to be granted Q4, 2014. Operations under the new name are scheduled to begin Q1, 2015 with approximately $650 million in assets.

The combined banks will continue to serve their traditional central and south Texas markets through 14 full-service branches and five loan production offices. David Kapavik, President and CEO of Lone Star Bank (Moulton, TX) for 20 years has been named President and CEO of the new SouthStar Bank. Norman Koch, President of First Star Bank (Bremond, TX), has been named Regional President. Texas Star Bank (Lott, TX) President Billy Fleming has been named Executive Vice President and National Sales Manager for the firm’s mortgage warehousing operation.

The bank’s rural service areas include Lavaca, Gonzales, Brazoria, Robertson, Milam, and Falls counties. Over the past decade, the organization has leveraged its long-standing focus on rural markets to open flagship branches and loan production offices in the Austin and San Antonio metropolitan areas.

Throughout their 100-year history, the banks have remained true to their rural Texas heritage, focusing on community values and personal relationships coupled with flexible, common-sense lending. SouthStar Bank will continue to live these core values while specializing in commercial real estate lending, consumer and home loans, and nation-wide mortgage warehouse funding.

“Our consolidation will result in a stronger bank with broader market presence, greater lending capabilities, and more efficient, centralized operations. But most importantly, the move will enable us to better serve our customers with a superior level of products, services and care regardless of which branch they call home,” said Paris Schindler, Chairman of majority owner Southern Bancshares.

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About Southern Bancshares, Inc.

Southern Bancshares, Inc. is a Houston, TX─based financial services holding company and majority owner of First Star Bank (est. 1905), Texas Star Bank (est. 1909), and Lone Star Bank (est. 1920). The firm was founded in 1982 by the Raymond Schindler family to accommodate the addition of Lone Star Bank and Texas Star Bank to their original purchase ─ First Star Bank ─ acquired in 1973. Southern Bancshares Chairman Paris Schindler and Vice Chairman Timothy Brown jointly manage the privately-held company.