Edgar Filing: SCBT FINANCIAL CORP

================================================================================
UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

SCHEDULE 14A

INFORMATION REQUIRED IN PROXY STATEMENT

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934

(AMENDMENT NO. ______)

Filed by the registrant [X]
Filed by a party other than the registrant [_]

Check the appropriate box:

[_] Preliminary proxy statement
[_] Confidential, for use of the Commission only (as permitted by Rule
14a-6(e)(2))
[X] Definitive proxy statement
[_] Definitive additional materials
[_] Soliciting material under Rule 14a-12

SCBT FINANCIAL CORPORATION
------------------------------------------------
(Name of Registrant as Specified in Its Charter)

--------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of filing fee (check the appropriate box):

[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1) Title of each class of securities to which transaction applies:

2) Aggregate number of securities to which transaction applies:

3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it is determined):

4) Proposed maximum aggregate value of transaction:

5) Total fee paid:

[_] Fee paid previously with preliminary materials.

[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing:

1) Amount Previously Paid:

2) Form, Schedule of Registration Statement No.:

3) Filing Party:

4) Date filed:
================================================================================

SCBT FINANCIAL CORPORATION
520 Gervais Street
Columbia, South Carolina 29201

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held April 26, 2005

TO THE SHAREHOLDERS:

Notice is hereby given that the Annual Meeting of the Shareholders (the
"Annual Meeting") of SCBT Financial Corporation, a South Carolina corporation
(the "Company"), will be held at the Company's headquarters in the
Dorchester-Jasper Room on the second floor, 520 Gervais Street, Columbia, South
Carolina at 2:00 p.m., on April 26, 2005, for the following purposes:

(1) To elect five directors of the Company to serve three-year terms;

(2) To ratify the appointment of J.W. Hunt and Company, LLP, Certified
Public Accountants, as independent auditors for the Company for the
fiscal year ending December 31, 2005; and

(3) To transact such other business as may properly come before the
Annual Meeting or any adjournment thereof.

Only record holders of Common Stock of the Company at the close of business
on March 1, 2005, are entitled to notice of and to vote at the Annual Meeting or
any adjournment thereof.

The Company's Proxy, Proxy Statement (providing important shareholder
information for the Annual Meeting), and 2004 Annual Report to Shareholders
(which includes its 2004 Annual Report on Form 10-K) are enclosed with this
Notice.

You are cordially invited and urged to attend the Annual Meeting in person.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE
REQUESTED TO COMPLETE, DATE, SIGN AND PROMPTLY RETURN THE ENCLOSED PROXY IN THE
ENCLOSED SELF-ADDRESSED, STAMPED ENVELOPE. IF YOU NEED ASSISTANCE IN COMPLETING
YOUR PROXY, PLEASE CALL THE COMPANY AT 800-277-2175. IF YOU ARE A RECORD
SHAREHOLDER, ATTEND THE ANNUAL MEETING AND DESIRE TO REVOKE YOUR PROXY AND VOTE
IN PERSON, YOU MAY DO SO. IN ANY EVENT, A PROXY MAY BE REVOKED BY A RECORD
HOLDER AT ANY TIME BEFORE IT IS EXERCISED.

THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR"
APPROVAL OF ALL THE PROPOSALS PRESENTED.

By Order of the Board of Directors

/s/ James C. Hunter, Jr.

James C. Hunter, Jr.
Secretary

Columbia, South Carolina
March 16, 2005

SCBT FINANCIAL CORPORATION
520 Gervais Street
Columbia, South Carolina 29201

PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS
to be Held April 26, 2005

This Proxy Statement is furnished to shareholders of SCBT Financial
Corporation, a South Carolina corporation (herein, unless the context otherwise
requires, together with its subsidiaries, the "Company"), in connection with the
solicitation of proxies by the Company's Board of Directors for use at the
Annual Meeting of Shareholders to be held at the Company's headquarters in the
Dorchester-Jasper Room on the second floor, 520 Gervais Street, Columbia, South
Carolina at 2:00 p.m., on April 26, 2005 or any adjournment thereof (the "Annual
Meeting"), for the purposes set forth in the accompanying Notice of Annual
Meeting of Shareholders.

Solicitation of proxies may be made in person or by mail, telephone or
other means by directors, officers and regular employees of the Company. The
Company may also request banking institutions, brokerage firms, custodians,
nominees and fiduciaries to forward solicitation materials to the beneficial
owners of Common Stock of the Company held of record by such persons, and the
Company will reimburse the reasonable forwarding expenses. The cost of
solicitation of proxies will be paid by the Company. This Proxy Statement was
first mailed to shareholders on or about March 15, 2005.

The Company has its principal executive offices at 520 Gervais Street,
Columbia, South Carolina 29201. The Company's mailing address is P.O. Box 1030,
Columbia, South Carolina 29202, and its telephone number is 803-771-2265.

ANNUAL REPORT

The Annual Report to Shareholders (which includes the Company's Annual
Report on Form 10-K containing, among other things, the Company's fiscal year
ended December 31, 2004 financial statements) is enclosed herewith. Such Annual
Report to Shareholders does not form any part of the material for the
solicitation of proxies.

REVOCATION OF PROXY

Any record shareholder returning the accompanying proxy may revoke such
proxy at any time prior to its exercise (a) by giving written notice to the
Company of such revocation, (b) by voting in person at the meeting, or (c) by
executing and delivering to the Company a later dated proxy. Attendance at the
Annual Meeting will not in itself constitute revocation of a proxy. Any written
notice or proxy revoking a proxy should be sent to SCBT Financial Corporation,
P.O. Box 1030, Columbia, South Carolina 29202, Attention: James C. Hunter, Jr.
Written notice of revocation or delivery of a later dated proxy will be
effective upon receipt thereof by the Company.

QUORUM AND VOTING

The Company's only voting security is its $2.50 par value Common Stock
("Common Stock"), each share of which entitles the holder thereof to one vote on
each matter to come before the Annual Meeting. At the close of business on March
1, 2005 (the "Record Date"), the Company had issued and outstanding 8,054,818
shares of Common Stock, which were held of record by approximately 4,900
persons. Only shareholders of record at the close of business on the Record Date
are entitled to notice of and to vote on matters that come before the Annual
Meeting. Notwithstanding the Record Date specified above, the Company's stock
transfer books will not be closed and shares of the Common Stock may be
transferred subsequent to the Record Date. However, all votes must be cast in
the names of holders of record on the Record Date.

The presence in person or by proxy of the holders of a majority of the
outstanding shares of Common Stock entitled to vote at the Annual Meeting is
necessary to constitute a quorum at the Annual Meeting. If a share is
represented for any purpose at the Annual Meeting by the presence of the
registered owner or a person holding a valid proxy for the registered owner, it
is deemed to be present for the purposes of establishing a quorum. Therefore,
valid proxies which are marked "Abstain" or

"Withhold" or as to which no vote is marked, including proxies submitted by
brokers who are the record owners of shares but who lack the power to vote such
shares (so-called "broker non-votes"), will be included in determining the
number of votes present or represented at the Annual Meeting. If a quorum is not
present or represented at the meeting, the shareholders entitled to vote,
present in person or represented by proxy, have the power to adjourn the meeting
from time to time until a quorum is present or represented. If any such
adjournment is for a period of less than 30 days, no notice, other than an
announcement at the meeting, will be given of the adjournment. If the
adjournment is for 30 days or more, notice of the adjourned meeting will be
given in accordance with the Bylaws. Directors, officers and regular employees
of the Company may solicit proxies for the reconvened meeting in person or by
mail, telephone or other means. At any such reconvened meeting at which a quorum
is present or represented, any business may be transacted that might have been
transacted at the meeting as originally noticed. Once a quorum has been
established, it will not be destroyed by the departure of shares prior to the
adjournment of the meeting.

Provided a quorum is established at the meeting, directors will be elected
by a plurality of the votes cast at the Annual Meeting. Votes that are withheld,
broker non-votes and the failure to return a signed proxy will have no effect on
the outcome of the election of directors. Shareholders of the Company do not
have cumulative voting rights.

All other matters to be considered and acted upon at the Annual Meeting,
including the proposals to ratify the appointment of J. W. Hunt and Company,
LLP, Certified Public Accountants, as independent auditors, require that the
number of shares of Common Stock voted in favor of the matter exceed the number
of shares of Common Stock voted against the matter, provided a quorum has been
established. Abstentions, broker non-votes and the failure to return a signed
proxy will have no effect on the outcome of such matters.

ACTIONS TO BE TAKEN BY THE PROXIES

Each proxy, unless the shareholder otherwise specifies therein, will be
voted "FOR" the election of the persons named in this Proxy Statement as the
Board of Directors' nominees for election to the Board of Directors; and "FOR"
the ratification of the appointment of J. W. Hunt and Company, LLP as
independent auditors for the fiscal year ending December 31, 2005. In each case
where the shareholder has appropriately specified how the proxy is to be voted,
it will be voted in accordance with his specifications. As to any other matter
of business which may be brought before the Annual Meeting, a vote may be cast
pursuant to the accompanying proxy in accordance with the best judgment of the
persons voting the same. However, the Board of Directors does not know of any
such other business.

SHAREHOLDER PROPOSALS AND COMMUNICATIONS

Any shareholder of the Company desiring to include a proposal in the
Company's 2006 proxy materials for action at the 2006 Annual Meeting of
Shareholders must deliver the proposal to the executive offices of the Company
no later than November 15, 2005 if such proposal is to be considered for
inclusion in the 2006 proxy materials. Only proper proposals that are timely
received will be included in the Company's 2006 Proxy Statement and Proxy. In
addition, a shareholder who desires to nominate a person for election to the
board of directors of the Company or to make any other proposal for
consideration by shareholders at a shareholders' meeting must deliver notice of
such proposed action to the Secretary of the Company no less than 45 days before
such meeting. For a nominee for director, such notice must set forth the name of
the nominee, his or her address, the number of shares of stock owned by the
nominee and the name and address of the shareholder making the nomination. For
any other shareholder proposal, such notice must set forth the name and address
of the shareholder making the proposal and the text of the resolution to be
voted on.

The Company does not have a formal process by which shareholders may
communicate with the board of directors. Historically, however, the Chairman of
the Board has undertaken responsibility for responding to questions and concerns
expressed by shareholders. In the view of the board of directors, this approach
has been sufficient to ensure that questions and concerns raised by shareholders
are adequately addressed.

PRINCIPAL SHAREHOLDERS

The following table sets forth, as of March 1, 2005, the number and
percentage of outstanding shares beneficially owned by (i) each director and
nominee for director of the Company, (ii) each executive officer named in the
Summary Compensation Table, and (iii) all executive officers and directors of
the Company as a group. No person is known by the Company to own more than 5% of
the outstanding Common Stock

Amount and Nature of Beneficial Ownership
------------------------------------------------
Common Shares Common Shares Percent of
Beneficially Subject to a Shares
Name of Beneficial Owner Owned(1) Right to Acquire(2) Outstanding
--------------------------------------------------------------------------------
Colden R. Battey, Jr (3) 87,022 2,395 1.1%
Luther J. Battiste, III 1,540 1,208 *
Joe E. Burns (4)(6) 6,237 6,181 *
Thomas S. Camp (4)(6) 5,993 11,582 *
Charles W. Clark 63,243 2,857 *
M. Oswald Fogle 10,385 2,121 *
Dwight W. Frierson (5) 14,021 3,098 *
Robert R. Hill, Jr. (6) 33,984 6,384 *
Robert R. Horger (4)(6) 38,596 12,284 *
Richard C. Mathis (4)(6) 13,068 9,371 *
Harry M. Mims, Jr. 35,911 2,857 *
Ralph W. Norman 6,903 2,362 *
Anne H. Oswald (7) 1,175 1,681 *
John C. Pollok (3)(4)(6) 8,125 11,643 *
James W. Roquemore (3)(5) 18,051 2,520 *
Thomas E. Suggs 3,180 2,347 *
Susie H. VanHuss 500 0 *
A. Dewall Waters 30,420 2,247 *
John W. Williamson, III 51,035 1,901 *
Cathy Cox Yeadon (3)(5) 10,775 1,103 *

All directors and executive
officers as a group
(20 Persons)(2)(4)(6) 440,164 86,142 6.5%
-------------------------
* Indicates less than one percent of the outstanding SCBT Financial Corporation
Common Stock shares.

(1) As reported to the Company by the directors, nominees and executive
officers.
(2) Based on the number of shares acquirable by directors and executive
officers through vested stock options within 60 days of the Record Date
March 1, 2005.
(3) Excludes shares owned by or for the benefit of family members of the
following directors and executive officers, each of whom disclaims
beneficial ownership of such shares: Mr. Battey, 20,844 shares; Mr. Pollok,
532 shares; Mr. Roquemore, 4,798 shares; and Ms. Yeadon, 21,657 shares.
(4) Includes shares held as of December 31, 2004 by the Company under the
Company's Employee Savings Plan, as follows: Mr. Burns, 911 shares; Mr.
Camp, 591 shares; Mr. Horger, 1,160 shares; Mr. Mathis, 1,365 shares; Mr.
Pollok, 1,526 shares; and all directors and executive officers as a group,
5,553 shares.
5) For Mr. Frierson, includes 6,704 shares owned by Coca-Cola Bottling Company
of Orangeburg, of which Mr. Frierson is a management affiliate. Mr.
Frierson may direct the voting and disposition of these shares on that
company's behalf. For Mr. Roquemore, includes 7,127 shares owned by Patten
Seed Company, of which Mr. Roquemore is a 30% owner and management
affiliate. For Ms. Yeadon, excludes 17,583 shares owned by Cox Scholarship
Fund, of which Ms. Yeadon is an affiliate.
(6) Includes shares of restricted stock, as to which the executive officers
have full voting privileges. The shares are as follows: Mr. Burns, 3,800
shares; Mr. Camp, 4,132 shares; Mr. Hill, 5,613 shares; Mr. Horger, 584
shares; Mr. Mathis, 3,950 shares; Mr. Pollok, 4,283 shares; and all
directors and executive officers as a group, 22,362 shares. These
restricted stock shares are not currently vested.
(7) Ms. Oswald is currently a director but will be retiring from the board as
of the Annual Shareholders' Meeting.

ELECTION OF DIRECTORS

The Articles of Incorporation of the Company provide for a maximum of 20
directors, to be divided into three classes each serving three-year terms, with
the classes as equal in number as possible. The board of directors has set the
number of directors at 15, effective at the Annual Meeting. Luther J. Battiste,
III, Robert R. Hill, Jr., Ralph W. Norman, Susie H. VanHuss, and A. Dewall
Waters, all of whom currently are directors of the Company and whose terms
expire at the Annual Meeting, have been nominated by the board of directors for
reelection by the shareholders. The Company's bylaws provide that no shareholder
may nominate a person for election as a director of the Company unless the
shareholder has notified the Secretary of the Company in writing not less than
45 days prior to the meeting at which directors are to be elected. Such notice
must set forth the name of the nominee, his or her address, the number of shares
of common stock owned by the nominee and the name and address of the shareholder
making the nomination.

The table below sets forth the name, age and business experience for the
past five years of each nominee for director and each current director of SCBT
Financial Corporation.

Year First
Elected Business Experience
Name and Age Director for the Past Five Years
------------ -------- -----------------------

Director Nominees Whose Terms Will Expire in 2008

Luther J. Battiste, III(55) 2001 Partner in the firm Johnson, Toal
and Battiste, P.A., Attorneys at
Law, Columbia, S.C. and Orangeburg,
S.C.

Robert R. Hill, Jr.(38) 1996 President and Chief Executive
Officer of SCBT Financial
Corporation and South Carolina Bank
and Trust, N.A. since November 6,
2004. Prior to that time, Mr. Hill
served as President and Chief
Operating Officer of South Carolina
Bank and Trust, N.A. from 1999 to
November 6, 2004.

Ralph W. Norman (51) 1996 President of Warren Norman Co.,
Inc., a real estate brokerage firm.

Susie H. VanHuss(65) 2004 Executive Director of the University
of South Carolina Foundations and
Professor Emeritus of Management in
the Moore School of Business,
University of South Carolina,
Columbia, SC. As Executive Director,
she is the Chief Executive Officer
of the USC Educational Foundation
and the USC Development Foundation,
both 501(C)(3) non-profit South
Carolina corporations.

A. Dewall Waters(61) 1987 Partner in A.D. Waters Enterprises,
LLC, a partnership that owns and
operates McDonald's Restaurants.

Current Directors Whose Terms Will Expire in 2007

Robert R. Horger(54) 1991 Chairman of SCBT Financial
Corporation and South Carolina Bank
and Trust, N.A. since 1998. He also
has also served as Vice Chairman of
SCBT Financial Corporation and South
Carolina Bank and Trust, N.A. from
1994 to 1998. Mr. Horger is an
attorney with Horger, Barnwell and
Reid in Orangeburg, S.C.

Harry M. Mims, Jr.(63) 1988 President of J.F. Cleckley &
Company, a company engaged in site
development.

James W. Roquemore(50) 1994 Chief Executive Officer of Patten
Seed Company, Inc. of Lakeland, GA
and General Manager of
Super-Sod/Carolina, a company that
produces and markets turf, grass,
sod and seed.

John W. Williamson, III(56) 2001 President of J.W. Williamson
Ginnery, Inc., which is a partner in
Carolina Eastern-Williamson
Lynchburg Grain Company and Carolina
Soy. Also serves as Chairman of the
Jackson Companies, which operate a
camping resort, golf community, and
commercial development group in
Myrtle Beach, S.C.

Cathy Cox Yeadon(55) 1997 Vice President, Human Resources at
Cox Industries, Inc., a wood
preserving company.

Current Directors Whose Terms Will Expire in 2006

Colden Battey, Jr.(69) 1999 Senior Partner of Harvey & Battey
Law Firm, Beaufort, S.C.

Charles W. Clark(55) 1993 President and owner of Santee
Shores, Inc, Exit 98 Properties,
LLC; Golf Santee!, LLC, and Clark
Management, LLC. These properties
own, operate and market various
businesses in the Santee, S.C. area.

M. Oswald Fogle(60) 2001 President of Decolam, Inc., a
company engaged in the lamination of
boards and general warehousing.

Dwight W. Frierson(48) 1996 Vice Chairman of the Board, SCBT
Financial Corporation and South
Carolina Bank and Trust, N.A. He is
also Vice President and General
Manager of Coca-Cola Bottling
Company of Orangeburg, S.C.

Thomas E. Suggs(55) 2001 President and Chief Executive
Officer of Keenan and Suggs, Inc.,
an insurance brokerage and
consulting firm.

COMPENSATION OF DIRECTORS

Non-employee directors of the Company are paid a cash retainer of $500 per
calendar quarter and $500 per meeting of the bank subsidiary board of which they
are a member. Members of the executive committee, audit committee, compensation
committee, and governance committee are paid additional payments of $400, $400,
$300 ($400 in 2004) and $300, respectively, for each meeting attended. The
chairmen of the audit, compensation, and governance committees currently receive
$800, $800 and $500, respectively, per committee meeting in lieu of the
corresponding amounts above. Under the Company's deferred compensation plan,
directors may elect to defer all or a portion of their directors' fees and to
treat such deferred amounts as though they were invested in one or more
investment options designated by the plan. Amounts deferred under the plan
remain general obligations of the Company and become payable at the times (or
during the periods) designated by participating directors. Directors who are
also officers of the Company or its subsidiaries do not receive fees for serving
as a director.

Beginning in 2005, the Company plans to make an annual award to each
non-employee director of options to acquire 500 shares of the Company's common
stock at the then-current sales price and 200 shares of restricted stock. These
awards will be granted following the Company's annual shareholders' meeting and
will vest over a period not exceeding one year from the date of grant.

From time to time, the Company pays additional compensation to its
directors in recognition of special factors. In February 2005, the Company
awarded Anne H. Oswald, who will retire from the board of directors at the
Annual Shareholders' Meeting, 200 shares of common stock in recognition of her
services to the Company. In addition, in connection with the appointment of
Susie H. VanHuss to the board of directors in October 2004, the Company awarded
Dr. VanHuss in February 2005, 400 shares of restricted stock that vest in four
equal quarterly installments during Dr. VanHuss's first year of service on the
board of directors.

Robert R. Horger, who serves as Chairman of the Board of the Company,
currently receives $77,315 annually for serving in that capacity. In addition,
in January 2004, the Company granted to Mr. Horger options to purchase 3,675
shares of the Company's common stock at $28.58 per share. These options become
exercisable in four equal annual installments over the four-year period
following the date of grant.

THE BOARD OF DIRECTORS AND COMMITTEES

During 2004, the board of directors of the Company held seven meetings.
Each director attended at least 75% of the aggregate of (a) the total number of
meetings of the board of directors held during the period for which he or she
served as a director, and (b) the total number of meetings held by all
committees of the board of directors of the Company on which he or she served.

There is no formal policy regarding attendance at annual shareholder
meetings. However, attendance at annual shareholder meetings has always been
strongly encouraged. Last year, 16 of the Company's 18 directors active at that
time attended the 2004 Annual Shareholders' Meeting.

The board of directors has determined that Colden R. Battey, Jr., Luther J.
Battiste, III, Charles W. Clark, M. Oswald Fogle, Dwight W. Frierson, Harry M.
Mims, Jr., Ralph W. Norman, James W. Roquemore, Thomas E. Suggs, Susie H.
VanHuss, A. Dewall Waters, John W. Williamson, III, and Cathy Cox Yeadon are
independent directors under the independence requirements of The Nasdaq Stock
Market applicable to directors who do not serve on the audit committee.
Therefore, under these requirements, a majority of the members of the Company's
board of directors is independent.

The board of directors has adopted a Code of Ethics that is applicable to
the Company's chief executive officer, chief financial officer, corporate
controller, manager of financial reporting and all managers reporting to these
individuals who are responsible for accounting and financial reporting. The Code
of Ethics has been filed as Exhibit 14 to the Company's Annual Report on Form
10-K for the year ended December 31, 2004.

The board of directors of the Company maintains executive, audit,
compensation, governance and policy committees. The functions, composition and
frequency of meetings for these committees during 2004 were as follows:

Executive Committee - The executive committee is composed of Robert R.
Horger, Chairman, Colden R. Battey, Jr., Charles W. Clark, Dwight W. Frierson,
Robert R. Hill, Jr., Harry M. Mims, Jr., James W. Roquemore, and Thomas E.
Suggs. The board of directors of the Company may, by resolution adopted by a
majority of its members, delegate to the executive committee the power, with
certain exceptions, to exercise the authority of the board of directors in the
management of the affairs of the Company. The executive committee met twenty
times in 2004.

Audit Committee - The audit committee is composed of M. Oswald Fogle,
Chairman, Luther J. Battiste, III, Ralph W. Norman, Susie H. VanHuss, John W.
Williamson, III, and Cathy Cox Yeadon. The board of directors has determined
that all members of the audit committee are independent directors under the
independence requirements of The Nasdaq Stock Market. The board of directors has
also determined that M. Oswald Fogle is an "audit committee financial expert"
for purposes of the rules and regulations of the Securities and Exchange
Commission adopted pursuant to the Sarbanes-Oxley Act of 2002. The audit
committee held eleven meetings and one seminar in 2004. The primary function of
the audit committee is to assist the board of directors of the Company in
overseeing (i) the Company's accounting and financial reporting processes
generally, (ii) the audits of the Company's financial statements and (iii) the
Company's systems of internal controls regarding finance and accounting. In such
role, the audit committee reviews the qualifications, performance and
independence of the Company's independent accountants and has the authority to
appoint, evaluate and, where appropriate, replace the Company's independent
accountants. The audit committee, among other things, also oversees the
Company's internal audit department. The board of directors has adopted a
charter for the audit committee, and a copy of the charter was filed as Appendix
A to the Company's 2004 Proxy Statement.

Compensation Committee - The compensation committee is composed of A.
Dewall Waters, Chairman, Colden R. Battey, Jr., Charles W. Clark, M. Oswald
Fogle, and Harry M. Mims, Jr.. The compensation committee met five times in
2004. The board of directors has determined that all members of the compensation
committee are independent directors under the independence requirements of The
Nasdaq Stock Market applicable to directors who do not serve on the audit
committee. The compensation committee evaluates the performance of the executive
officers of the Company and recommends to the board of directors, through the
executive committee, matters concerning compensation, salaries, and other forms
of executive compensation to officers of the Company.

Governance Committee - The governance committee is composed of Dwight W.
Frierson, Chairman, Colden R. Battey, Jr. and Ralph W. Norman. The board of
directors has determined that all members of the governance committee are
independent directors under the independence requirements of The Nasdaq Stock
Market applicable to directors who do not serve on the audit committee. The
governance committee met two times in 2004. The governance committee acts as the
nominating committee for the purpose of recommending to the board of directors
nominees for election to the board of directors. The governance committee also
periodically reviews and, where appropriate, recommends changes to the Company's
corporate

governance practices. The board of directors has adopted a charter for the
governance committee, and a copy of that charter is attached as Appendix A to
this Proxy Statement. The governance committee has not established any specific,
minimum qualifications that must be met for a person to be nominated to serve as
a director, and the governance committee has not identified any specific
qualities or skills that it believes are necessary to be nominated as a
director. Nominees for the board are reviewed by the governance committee on a
case-by-case basis based on a number of factors, including a proposed nominee's
independence, age, skills, occupation, diversity and experience and any other
factors beneficial to the Company. The governance committee will consider
nominees identified by its members, other directors, officers and employees of
the Company and other persons, including shareholders of the Company.

The governance committee will consider nominees for director recommended by
a shareholder if the shareholder provides the committee with the information
described in paragraph 6 under the caption "Committee Authority and
Responsibilities" of the governance committee's charter.

In October 2004, upon the recommendation of the governance committee, the
board of directors appointed Susie H. VanHuss to serve on the board of directors
until the 2005 Annual Shareholders' Meeting. Upon the governance committee's
further recommendation, the board of directors has nominated Dr. VanHuss for
election by the shareholders at the Annual Shareholders' Meeting to serve in the
group of directors whose term will expire in 2008. Dr. VanHuss was identified as
a potential director candidate by Thomas E. Suggs, a current director of the
Company, based on Mr. Suggs's knowledge of Dr. VanHuss through his involvement
with the University of South Carolina and affiliated foundations and
organizations.

Policy Committee - The policy committee is composed of Dwight W. Frierson,
Chairman, Colden R. Battey, Jr., Charles W. Clark, Robert R. Horger, Harry M.
Mims, Jr., James W. Roquemore, and Thomas E. Suggs. The primary purpose of the
policy committee is to recommend new policies and review present policies or
policy updates and changes. The policy committee met three times in 2004.

EXECUTIVE COMPENSATION

The following table summarizes for the years indicated the current and
long-term compensation for the Chief Executive Officer of the Company, the
former Chief Executive Officer of the Company, and the four most highly
compensated executive officers other than the Chief Executive Officer (the
"named executive officers").

SUMMARY COMPENSATION TABLE

Annual Long Term
Compensation(2) Compensation Awards
--------------- -------------------

Securities
Name and Restricted Underlying All Other
Principal Position Year Salary Bonus(3) Stock Awards(4) Options(#)(5) Compensation(7)
-------------------------------------------------------------------------------------------------------------

Robert R. Hill, Jr. (1) 2004 $199,754 -- - 6,300 $4,012
President and Chief 2003 184,000 $57,600 - 6,300 5,174
Executive Officer 2002 171,120 61,482 $107,600 6,930 5,506

C. John Hipp, III (1) 2004 $260,077 -- - 10,500 $309,462(6)
Former President and 2003 280,000 $73,589 - 10,500 6,274
Chief Executive Officer 2002 262,150 87,590 - 11,088 6,502

Thomas S. Camp 2004 $170,560 -- - 4,200 $6,055
President and CEO 2003 164,000 $61,635 - 4,200 4,712
South Carolina Bank 2002 152,280 72,952 $107,600 4,620 4,015
and Trust of the
Piedmont, N.A.

John C. Pollok 2004 $169,388 -- - 5,250 $6,052
Senior Executive Vice 2003 156,154 $63,600 - 4,200 4,406
President and Chief 2002 135,890 54,118 $94,150 4,043 4,015
Operating Officer

Richard C. Mathis 2004 $165,900 -- - 4,410 $5,923
Executive Vice 2003 158,000 $40,900 - 4,410 4,443
President and 2002 146,590 49,836 $94,150 4,620 4,331
Chief Financial Officer

Joe E. Burns 2004 $152,000 -- - 4,200 $5,443
Executive Vice 2003 146,000 $36,500 $54,920 4,200 4,105
President and Chief 2002 135,450 49,900 26,900 4,043 4,002
Credit Officer

(1) Mr. Hipp resigned as President and Chief Executive Officer as of November
6, 2004. Mr. Hill was appointed by the Board of Directors as Interim
President and Chief Executive Officer effective the same date.
Subsequently, Mr. Hill was elected unanimously by the Board of Directors as
President and Chief Executive Officer.

(2) Perquisites and personal benefits did not exceed the lesser of $50,000 or
10% of total salary plus bonus.

(3) The Company's subsidiaries maintain incentive compensation plans. Amounts
payable under the incentive compensation plans are most commonly based on
the particular subsidiary's performance in terms of its return on equity,
growth of assets and deposits, and divisional or individual goals for any
calendar year. The Compensation Committee sets performance goals at the
beginning of any calendar year. The board of directors, however, has the
discretion to change during any year the performance goals, payment amounts
and other requirements of the incentive compensation plans. The incentive
compensation plans create incentive reserves for the calendar year. Amounts
paid into an incentive pool are distributed to participating employees
based on the individual employee's merit ratings, attainment of
company-wide and divisional goals, salary level, and qualitative factors.

(4) From time to time, the Company has awarded shares of restricted stock to
its executive officers. The Company did not grant any shares of restricted
stock to the executive officers named above during 2004. Shares of
restricted stock that were issued

in 2002 and 2003 generally vest subject to the continued employment of the
officer as follows: (a) 25% of the shares vest free of restrictions on the
third anniversary of the date of grant; (b) 25% of the shares vest free of
restrictions on the fifth anniversary of the date of grant; and (c) 50% of
the shares vest free of restrictions on the seventh anniversary of the date
of grant. An officer's interest in any non-vested shares would terminate
upon the termination of the officer's employment with the Company, except
that all restricted shares will fully vest if there is a change in control
in the Company or the officer dies while employed by the Company. Each
officer generally has the right to vote restricted shares and to receive
dividends paid on the shares prior to vesting. The number and market value
of unvested shares of restricted stock held by the officers named above at
December 31, 2004, were as follows: Mr. Hill - 4,620 shares ($155,093); Mr.
Camp - 4,620 shares ($155,093); Mr. Pollok - 4,043 shares ($135,723); Mr.
Mathis - 4,043 shares ($135,723); and Mr. Burns - 3,255 shares ($109,270).

(5) All options to purchase securities reflect the effect of a 5% stock
dividend paid on January 1, 2005, and the options granted in 2002
additionally reflect the effect of a 10% stock dividend paid on December 6,
2002.

(6) In addition to the items described in footnote (7) below, in connection
with Mr. Hipp's resignation as President and Chief Executive Officer of the
Company, he and the Company entered into a severance agreement, which is
described in more detail under the caption "Employment Agreements - C. John
Hipp, III" below. Under the terms of Mr. Hipp's severance agreement, Mr.
Hipp became entitled to receive, among other things, (i) severance
compensation of $294,000, which was paid in one lump sum by the Company in
January 2005, (ii) title to the automobile (2002 Buick Park Avenue)
provided by the Company to Mr. Hipp while he was employed by the Company,
which had an estimated value of $9,550 at the time title was transferred to
Mr. Hipp, and (iii) continued health care benefits, resulting in premium
payments by the Company of an aggregate of $3,724.

(7) Includes contributions by the Company's subsidiaries through matching or
discretionary contributions to their employee savings plans allocated to
the named executive officers' accounts, and term life insurance premiums
paid by the Company's subsidiaries for the benefit of the named executive
officers as follows:

Employee Savings Life Insurance
Plan(2) Premiums
------- --------

Robert R. Hill, Jr.(1) 2004 $ 2,443 $ 1,569
2003 3,680 1,494
2002 3,422 1,634

C. John Hipp, III(1) 2004 -- $ 2,188
2003 $4,000 2,274
2002 4,000 2,502

Thomas S. Camp 2004 $ 4,723 $ 1,332
2003 3,280 1,332
2002 3,046 1,453

John C. Pollok 2004 $ 4,697 $ 1,355
2003 3,123 1,283
2002 2,718 1,297

Richard C. Mathis 2004 $ 4,575 $ 1,348
2003 3,160 1,283
2002 2,932 1,399

Joe E. Burns 2004 $ 4,209 $ 1,234
2003 2,920 1,185
2002 2,709 1,293

EMPLOYMENT AGREEMENTS

C. JOHN HIPP, III

In September 1999, C. John Hipp, III, entered into an amended and restated
employment and noncompetition agreement with the Company. The agreement provided
for compensation for Mr. Hipp at the 1999 level or a greater rate set by the
board of directors or by a committee appointed by the board of directors, plus
fringe benefits and reimbursement of expenses. During his employment and for 12
months thereafter, Mr. Hipp has agreed not to compete with the Company through
accepting traditional banking services employment in any county where the
Company is conducting business, solicit customers of the Company, or induce any
Company employee to leave the Company for the purpose of competing with the
Company.

On December 20, 2004, Mr. Hipp entered into a severance agreement with the
Company that was effective as of November 5, 2004. Under the terms of the
agreement, Mr. Hipp confirmed his resignation from all positions held by Mr.
Hipp with the Company and its subsidiaries, and the Company agreed to (i) pay
Mr. Hipp severance compensation of $294,000 in one lump sum (which was paid by
the Company to Mr. Hipp in January, 2005), (ii) transfer title to the Company
automobile (2002 Buick Park Avenue) used by Mr. Hipp prior to his resignation,
(iii) continue to pay for Mr. Hipp's health plan coverage through November 5,
2005 and (iv) vest in full Mr. Hipp's options to acquire an aggregate of 10,794
(including the effect of the 5% stock dividend payable to shareholders of record
as of December 20, 2004) shares of common stock of the Company, which options
would otherwise have expired unvested as a result of Mr. Hipp's resignation. The
agreement also contains a mutual release of certain claims that may be made by
Mr. Hipp against the Company and the Company against Mr. Hipp. The agreement
continues certain provisions of Mr. Hipp's amended and restated employment
agreement, including the noncompetition provisions in such agreement.

ROBERT R. HILL, JR.

In September 1999, the Company entered into an employment and
noncompetition agreement with Mr. Hill that extends for a rolling three-year
period. Under the agreement, Mr. Hill is entitled to receive base salary
(currently $250,000 per year), certain fringe benefits such as country club dues
and an automobile, and reimbursement of his business-related expenses, and to
participate in other compensatory and employee benefit plans maintained by the
Company from time to time, including the Company's incentive bonus plans. If Mr.
Hill's employment is terminated by reason of death, disability or without cause,
or if he terminates his employment because he is relocated or his
responsibilities are reduced without his consent, the Company generally is
required to pay him (or his estate) his base salary in effect at the time of
termination for 12 months following termination and to continue his health,
medical and dental insurance and other benefits during such period. In addition,
if Mr. Hill's employment is terminated by either Mr. Hill or the Company
following a change in control (other than by reason of death, disability or
cause), Mr. Hill will be entitled to continued compensation of an amount equal
to the product of 2.99 multiplied by his "base amount" as defined in Section
280G(b)(3) of the Internal Revenue Code (generally the average of the previous
five tax years' annual compensation), such amount to be paid over 36 months or
in lump sum at Mr. Hill's discretion. The Company must also pay Mr. Hill's
medical and life insurance during such 36-month period. During his employment
and for 12 months following any termination of his employment, Mr. Hill has
agreed not to compete with the Company through accepting traditional banking
services employment in any county where the Company is conducting business,
solicit customers of the Company, or induce any Company employee to leave the
Company for the purpose of competing with the Company.

OTHER NAMED EXECUTIVE OFFICERS

The Company has entered into employment agreements with the other named
executive officers of the Company (Mr. Camp, Mr. Pollok, Mr. Mathis and Mr.
Burns). Under these agreements, these executive officers are entitled to receive
annual base salary (currently, for Mr. Camp, $175,676; for Mr. Pollok, $190,000;
for Mr. Mathis, $172,000; and for Mr. Burns, $157,000), certain fringe benefits
which may vary among officers such as country club dues and an automobile,
reimbursement of their business-related expenses, and participation in other
compensatory and employee benefit plans maintained by the Company from time to
time, including the Company's incentive bonus plans. If their employment is
terminated by the Company without cause, the Company generally will be required
to pay them their base salary in effect at the time of termination for six
months following termination. In addition, if their employment is terminated by
the Company for any reason other than as a result of death, disability or for
cause following a change in control, the Company is required to pay them their
base salary then in effect for 24 months following termination. During their
employment and for a period of between 6-18 months following their employment
(depending on the circumstances resulting in the termination of employment),
these executive officers have agreed not to compete with the Company through
accepting traditional banking services employment in the counties in South
Carolina where their primary office is (or formerly was) located or to solicit
customers of the Company, or induce any Company employee to leave the Company
for the purpose of competing with the Company, in any county where the Company
is conducting business.

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENTS

The Company anticipates that in March 2005, but subsequent to filing this
Proxy Statement, the Company will enter into amended and restated supplemental
executive retirement agreements with the named executive officers other than Mr.
Hipp. These amended and restated agreements will replace the supplemental
executive retirement agreements currently in place. Under the amended and
restated agreements, the named executive officers generally will be entitled to
receive retirement benefits over the 20-year period following retirement after
attaining age 60 for Mr. Hill and Mr. Pollok, ages 62-65 for Mr. Camp and Mr.
Mathis, and age 65 for Mr. Burns. The annual amount of such benefits may not
exceed $125,000 for Mr. Hill, $50,000 for Mr. Camp, $100,000 for Mr. Pollok,
$65,000 for Mr. Mathis and $50,000 for Mr. Burns, with the exact amount
generally determined by reference to the number of calendar years of their
employment after 2002 in which the Company satisfied both of the following
performance measures: (i) the Company's net income for the year exceeded 106% of
the Company's net income for the previous year; and (ii) the book value of the
Company's total assets as of the end of the year exceeded 107% of the book value
of the Company's total assets as of the end of the immediately preceding year.
If the named executive officers were to have retired at normal retirement age as
of December 31, 2004, they would have been entitled to 50% of their maximum
annual retirement benefit based on the performance of the Company subsequent to
December 31, 2002. A smaller annual benefit, payable over the 20-year period
after the executive attains his normal retirement age, will become payable if
the employment of any of these officers is terminated prior to attaining
retirement age for any reason other than death or for cause. If an executive
dies, the Company will be required to pay his estate a lump sum amount (which is
$375,000 for Mr. Hill and $250,000 for Mr. Camp, Mr. Pollok, Mr. Mathis and Mr.
Burns) plus an annual amount (which is $125,000 for Mr. Hill, $50,000 for Mr.
Camp, $100,000 for Mr. Pollok, $65,000 for Mr. Mathis and $50,000 for Mr. Burns)
in monthly installments over the 10-year period following death. These
executives will forfeit their retirement benefits if they compete with the
Company. The Company's obligations under the agreements are general unsecured
obligations of the Company, although the agreements require the Company to
establish a grantor ("rabbi") trust for such benefits following a change in
control.

DEFERRED COMPENSATION PLAN

The Company has adopted a deferred compensation plan under which directors,
executive officers and certain other employees are entitled to participate.
Under the plan, directors and executive officers may defer all or a portion of
their compensation from the Company and treat these amounts as though they were
invested in one or more investment options designated by the plan. Amounts
payable under the plan remain general obligations of the Company and are payable
by the Company at the times (or over the periods) designated by plan
participants when they elect to participate in the plan.

STOCK OPTIONS

The following table provides information concerning stock options exercised
by the named executives in 2004 and the value of options held by each executive
at December 31, 2004.

AGGREGATED OPTION EXERCISES DURING 2004 AND YEAR END 2004 OPTION VALUES

Number of Securities
Underlying Value of Unexercised
Unexercised Options In-the-Money Options
Shares At Fiscal Year-End(2) At Fiscal Year-End(3)
Acquired on Value --------------------- -----------------------
Executive Officer Exercise(#) Realized(1) Exercisable Unexercisable Exercisable Unexercisable
-------------------------------------------------------------------------------------------------------------------

Robert R. Hill, Jr.(4) 15,550 $212,982 -- 15,992 -- $171,129
C. John Hipp, III(4) 27,573 365,868 10,794 -- $146,860 --
Thomas S. Camp -- -- 7,604 10,383 126,101 108,071
John C. Pollok -- -- 7,547 11,144 124,525 108,437
Richard C. Mathis 1,444 20,871 5,435 10,604 90,211 107,585
Joe E. Burns 3,465 61,568 4,227 9,371 68,712 87,573

(1) Based on the difference between the closing price on the date of exercise
and the option exercise price.
(2) Figures shown represent the total number of shares subject to unexercised
options held by the indicated executive officers at year-end 2004. The
number of shares subject to options which were exercisable and
unexercisable at year-end 2004 is displayed. The number of options granted
has been adjusted to reflect all stock splits and stock dividends.
(3) Dollar amounts shown represent the value of "in-the-money" stock options
held by the indicated officers at year-end 2004.

Shares subject to an option are considered to be "in-the-money" if the fair
market value at December 31, 2004 of shares of stock exceeds the exercise
or base price of such shares. The value of the "in-the-money" options is
computed based on the difference between the $33.57 per share market value
of the stock at December 31, 2004 and the exercise or base price of the
shares subject to underlying options. The value of shares subject to
options that are exercisable and unexercisable at December 31, 2004 is
displayed.

(4) Mr. Hipp resigned as President and Chief Executive Officer as of November
6, 2004. Mr. Hill was appointed by the Board of Directors as Interim
President and Chief Executive Officer effective the same date.
Subsequently, Mr. Hill was elected unanimously by the Board of Directors as
President and Chief Executive Officer.

The following table provides information concerning the grant of stock options
during 2004 to the named executives.

OPTION GRANTS IN 2004

Potential Realizable Value
Percent of Total At Assumed
Number of Securities Options Granted Exercise or Annual Rates of Stock Price
Underlying Options to Employees in Base Price Expiration Appreciation for Option Term(3)
Executive Officer Granted (1) Fiscal Year ($/Share)(1)(2) Date 5% 10%
-----------------------------------------------------------------------------------------------------------------------------------

Robert R. Hill, Jr.(4) 6,300 8.62% $28.58 1/2/2014 $113,239 $286,969
C. John Hipp, III(4) 10,500 14.37 28.58 1/2/2014 188,731 478,282
Thomas S. Camp 4,200 5.75 28.58 1/2/2014 75,493 191,313
John C. Pollok 5,250 7.18 28.58 1/2/2014 94,366 239,141
Richard C. Mathis 4,410 6.03 28.58 1/2/2014 79,267 200,878
Joe E. Burns 4,200 5.75 28.58 1/2/2014 75,493 191,313

(1) All stock options become exercisable over a four-year period in 25%
increments. The number of securities granted and the exercise price have
been adjusted to reflect a 5% stock dividend paid on January 1, 2005.

(2) The exercise price equals the market price of the Company's common stock on
the date of the grant.

(3) The potential gains are based on the assumed annual rates of stock price
appreciation of 5% and 10% over the term of each option. Any actual gains
are dependent on the future performance of the Company's common stock and
general market conditions. There is no assurance that the assumed rates of
stock price appreciation will be achieved. Increases in the stock price
will benefit all shareholders commensurately.

REPORT ON EXECUTIVE OFFICER COMPENSATION

The Company's Compensation Committee is required to provide the Company's
shareholders with a report discussing the Compensation Committee's policies in
establishing compensation for the Company's executive officers. The report is
also required to discuss the relationship, if any, between the Company's
performance and executive officer compensation. Finally, the report must
specifically discuss the factors and criteria upon which the compensation paid
to the Company's Chief Executive Officer was based.

This report is provided as a summary of current practice with regard to the
annual compensation review and authorization of executive officer compensation,
and with respect to specific action taken for the Chief Executive Officer. The
$1,000,000 tax deduction limitation for executive compensation which is not
performance based, added by the Omnibus Budget Reconciliation Act of 1993, is
not relevant to this year's report and does not affect either the Company's or
it subsidiaries' compensation policy. Should such limitations become relevant,
steps will be taken to amend the Company's and its subsidiaries' compensation
policy to assure compliance.

The fundamental philosophy of the Company's compensation program is to
offer competitive compensation opportunities for executive officers that are
based both on the individual's contribution and on the Company's performance.
The compensation

paid is designed to retain and reward executive officers who are capable of
leading the Company in achieving its business objectives in an industry
characterized by complexity, competitiveness and change. The compensation of the
Company's executive officers is reviewed and approved annually by the
Compensation Committee. Annual compensation for the Chief Executive Officer (and
other executive officers) consists primarily of three elements.

o A base salary that is determined by individual contribution and
performance, and which is designed to provide a base level of compensation
comparable to that provided to key executives of other financial
institutions of similar size and performance.

o A short-term cash incentive program that is directly linked to individual
performance and the Company's soundness, financial performance, and growth.

o A long-term incentive program that provides stock options and shares of
restricted stock to executive officers. Such awards provide an incentive
that focuses the executive's attention on managing the Company from the
perspective of a shareholder with an equity stake in the business. The
economic value of any such award is directly tied to the future performance
of the Company's stock and will provide value to the recipient when the
price of the Company's stock increases over time.

CHIEF EXECUTIVE OFFICER

Robert R. Hill, Jr. was elected Chief Executive Officer effective November
6, 2004, upon the resignation of the former Chief Executive Officer, C. John
Hipp, III. The compensation committee increased Mr. Hill's current annual salary
from $193,200 to $250,000. In arriving at this base salary amount, the committee
considered, among other things, Mr. Hill's 10-year tenure with the company and
his experience as President and Chief Operating Officer of the Company's lead
subsidiary, South Carolina Bank and Trust, N.A., for approximately 6 years. The
committee also reviewed average salary surveys for individuals in similar
positions employed by banking organizations of similar size and performance in
both the southeastern United States and nationally. Additionally, the committee
discussed the compensation with a human resource consultant and also gave
consideration to the salary level of the former chief executive officer. The
committee determined that, in combination with the cash incentive opportunity
(described below) and stock-based compensation awards previously described, the
$250,000 current annual salary was appropriate.

FORMER CHIEF EXECUTIVE OFFICER

C. John Hipp, III, served as the Company's Chief Executive Officer during
2004 through November 5, 2004. At the time of his departure, Mr. Hipp's annual
salary was $294,000, a 5% increase from the 2003 salary level of $280,000. In
establishing this 5% salary increase for 2004, the compensation committee
considered the Company's accomplishing a 13.72% return on average equity and
1.23% return on average assets in 2003. Additionally, the committee received
advice from compensation consultants, reviewed salary surveys for persons in
similar positions in southeastern and other banking organizations, and
considered compensation information for other chief executive officers in
community banks within South Carolina. The committee determined that the base
salary established for 2004, combined with a cash incentive opportunity
(described below) and stockbased compensation awards as previously described,
would provide compensation to Mr. Hipp comparable to that paid on average by
other banking organizations of similar size and financial performance.

EXECUTIVE OFFICER CASH INCENTIVES

In 2004, the named (and other) executive officers, including the Chief
Executive Officer and former Chief Executive Officer, had the opportunity to
participate in a performance-based executive incentive arrangement. This
arrangement could provide cash incentive payments based, first of all, on the
Company's and its subsidiaries attaining planned net income levels for 2004 (as
was determined in late 2003). Specific payments to individual executive officers
could also be influenced by each officer's attaining prescribed performance
goals. Since the Company's net income declined in 2004 from 2003, thus falling
short of the planned net income target, no executive officer received a cash
incentive for 2004.

For key executives, the annual cash incentive during the years 2004, 2003,
and 2002 ranged from approximately 0% to 48% of normal base salary for full-year
participants. This means that up to approximately one-third of annual
compensation was variable, could fluctuate significantly or be entirely omitted
from year to year, and was directly and indirectly tied to business and
individual performance.

CASH INCENTIVES FOR EXECUTIVES IN 2005

The cash incentive program for executive officers, including the Chief
Executive Officer, for 2005 is modified from recent years. The program is
completely described in Exhibit 10.28 to the Company's 2004 Annual Report on
Form 10-K. Essentially, the 2005 executive bonus arrangement indicates that,
first of all, the Company's subsidiaries must attain a prescribed overall rating
from their primary banking regulator. Next, the net income for a new year (e.g.,
2005) must at least equal or exceed the net income from the prior year (e.g.,
2004). Then, as the Company's and its subsidiaries' 2005 net incomes exceed the
prior year's levels up to and beyond a planned dollar amount of increase,
incentives accrue on a pro-rata basis. This earnings component can contribute up
to 40% of an executives' annual cash incentive. Attaining planned increases in
balances of total assets can contribute up to 20% of an executive's annual cash
incentive. Similarly, attaining planned increases in balances of deposits can
contribute up to 20% of an annual cash incentive. Finally, each executive has
individual and/or divisional goals, the attainment of which can contribute up to
20% of an annual cash incentive.

STOCK-BASED COMPENSATION

The Company from time to time also grants stock options and shares of
restricted stock to its executive officers. These stock-based incentive awards
help align the interests of the Company's executive officers with the interests
of the shareholders of the Company by providing economic value directly related
to increases in the value of the Company's stock. The number of options and
restricted shares granted to executive officers during any given year is based
on a number of factors, including seniority and job responsibilities, the amount
of awards made in prior years, and industry information from compensation
consultants and published surveys regarding stock-based awards granted to
officers employed by comparable companies. Please refer to the Summary
Compensation Table for a listing of stock options and restricted shares granted
to the listed executives in 2004, 2003, and 2002.

o Compensation Committee o

A. Dewall Waters, Chairman Colden R. Battey, Jr. Charles W. Clark

M. Oswald Fogle Harry M. Mims, Jr.

DEFINED BENEFIT PENSION PLAN

South Carolina Bank and Trust, N.A. maintains for the Company a
noncontributory, defined benefit pension plan covering its employees, including
the Company's executive officers. The pension plan is a "tax qualified" plan
under Section 401(a) of the Internal Revenue Code and must also comply with
provisions of the Employee Retirement Income Security Act of 1974.

The pension table below shows estimated annual benefits payable upon
retirement to persons in the specified remuneration and years of service
categories as if retirement had occurred on December 31, 2004. The benefits
shown are computed on a single life only annuity basis.

Employees' Pension Plan of South Carolina Bank and Trust
Estimated Annual Retirement Benefits
(For an Employee Whose Normal Retirement Date is 1/1/2005)
Years of Service
----------------------------------------------------------------------------
FAC* 10 Years 20 Years 30 Years 40 Years
----------------------------------------------------------------------------
----------------------------------------------------------------------------
$ 30,000 $ 2,700 $ 5,400 $ 8,100 $ 9,450
50,000 4,747 9,494 14,241 16,615
70,000 7,847 15,694 23,541 27,465
100,000 12,497 24,994 37,491 43,740
150,000 20,247 40,494 60,741 70,865
200,000 27,997 55,994 83,991 97,990
250,000 28,152 56,304 84,456 98,532
300,000 28,152 56,304 84,456 98,532
350,000 28,152 56,304 84,456 98,532
400,000 28,152 56,304 84,456 98,532
----------------------------------------------------------------------------
* FAC: Final Average Compensation is computed as the average amount of a
participant's compensation earned over the last 60 months prior to his or
her retirement date or early termination of employment.

Upon a participant's retirement at normal retirement date (age 65), a
monthly retirement benefit will be paid in accordance with pension plan
provisions. The amount of such monthly retirement benefit will equal 1/12 of the
sum of (i) and (ii) as follows: (i) .90% of the pension plan participant's final
average compensation multiplied by his years of credited service up to a maximum
of 35 years; and (ii) .65% of the pension plan participant's final average
compensation in excess of his covered compensation multiplied by his years of
credited service up to a maximum of 35 years. For purposes of the above formula,
social security covered compensation is currently set at $43,800 for an employee
whose normal retirement date is January 1, 2005. A participant's final average
compensation consists of the average amount of a participant's compensation
earned over the last 60 months prior to early or normal retirement. A
participant is credited with one year of credited service under the pension plan
for each year in which 1,000 or more hours are worked. Benefits under the
pension plan are not subject to deduction for social security or other offset
amounts. For purposes of computing a participant's final average compensation,
the pension plan used the following definition of participant compensation
during the first calendar quarter of 2004: W-2 earnings, including bonuses,
overtime and commissions, but excluding employer contributions to employee
benefit plans, as limited by Section 401 (a)(17) of the Internal Revenue Code.
However, beginning in April 2004 and going forward, participant compensation was
changed to include only 75% of bonuses and 50% of commissions, instead of total
bonuses and total commissions.

The executive officer compensation used for purposes of computing executive
officer benefits under the pension plan is approximately the same as that shown
in the Summary Compensation Table under Annual Compensation, plus the value of
Restricted Stock Awards during the year in which the awards vest. As of December
31, 2004 the named executive officers had accumulated the following years of
credited service toward retirement: Mr. Hill, 9 years credited service; Mr.
Camp, 6 years credited service; Mr. Pollok, 8 years credited service, Mr.
Mathis, 4 years credited service; and Mr. Burns, 3 years credited service.

SHAREHOLDER PERFORMANCE GRAPH

The following line graph compares the Company's cumulative total
shareholder return with a performance indicator of the overall stock market and
published industry indices. Shareholder return (measured through increases in
stock price and payment of dividends) is often a benchmark used in assessing
corporate performance and the reasonableness of compensation paid to executive
officers.

Shareholders should recognize that corporations often use a number of other
performance benchmarks (in addition to shareholder return) to set various levels
of executive officer compensation. The Company's 2004 Annual Report to
Shareholders contains a variety of relevant performance indicators concerning
the Company. Thus, shareholders may wish to consider other relevant performance
indicators in assessing shareholder return and the reasonableness of executive
compensation, such as growth in earnings per share, book value per share and
cash dividends per share, along with return on equity and return on assets
percentages. As described in the Report on Executive Officer Compensation, the
Company's compensation committee uses, among other considerations, growth in net
income, assets and deposits, performance of individual and divisional goals, and
qualitative factors in helping to determine short-term cash incentive program
awards.

The performance graph below compares the Company's cumulative total return
over the most recent five year period with the NASDAQ - Composite and the SNL
Southeast Bank Index, a banking industry performance index for the southeastern
United States. Returns are shown on a total return basis, assuming the
reinvestment of dividends and a beginning stock index value of 100 per share.
The value of the Company's stock as shown in the graph is based on published
prices for transactions in the Company's stock.

SCBT FINANCIAL CORPORATION

TOTAL RETURN PERFOMANCE CHART

[CHART APPEARS HERE]

PERIOD ENDED
---------------------------------------------------------------
INDEX 12/31/99 12/31/00 12/31/01 12/31/02 12/31/03 12/31/04
--------------------------------------------------------------------------------------------

SCBT FINANCIAL CORPORATION 100.00 60.55 92.04 129.03 165.38 198.57
NASDAQ - COMPOSITE 100.00 60.82 48.16 33.11 49.93 54.49
SNL SOUTHEAST BANK INDEX 100.00 100.70 125.09 138.18 173.52 205.78

Source: SNL Financial LC, 2005

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The Company's banking subsidiaries have loan and deposit relationships with
some of the directors of the Company and its subsidiaries and loan, deposit, and
fee-for-service relationships with some of the companies with which the
directors are associated, as well as with some members of the immediate families
of the directors. (The term "members of the immediate families" for purposes of
this paragraph includes each person's spouse, parents, children, siblings,
mother and father-in-law, sons and daughters-in-law, and brothers and
sisters-in-law.) Such loan, deposit, or fee relationships were made in the
ordinary course of business, were made on substantially the same terms,
including interest rates, collateral and fee pricing as those prevailing at the
time for comparable transactions with other persons, and did not, at the time
they were made, involve more than the normal risk of collectibility or present
other unfavorable features.

Robert R. Horger, Chairman of the Board of the Company, and Colden R.
Battey, Jr., a director, are partners in the law firms of Horger, Barnwell &
Reid and Harvey and Battey, PA, respectively, both of which South Carolina Bank
and Trust, N.A. engaged as counsel during 2004 and may engage during the current
fiscal year.

Thomas E. Suggs, a director, is President and Chief Executive Officer of
Keenan and Suggs, Inc., an insurance brokerage and consulting firm that the
Company used during 2004 and will use during the current fiscal year as an
insurance broker for certain policies. In 2004, the Company made payments to
Keenan and Suggs, Inc., as the Company's insurance placement agent, totaling
$212,434. Keenan and Suggs, Inc. pays these funds, net of its agency
commissions, to the various insurance companies providing insurance coverages to
SCBT Financial Corporation or its subsidiaries.

Colden R. Battey, Jr., a director of the Company, has a 20% interest in a
partnership that leases an office building to South Carolina Bank and Trust,
N.A., in Beaufort, South Carolina. Annual lease payments to the partnership
under this lease are approximately $138,950.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

As required by Section 16(a) of the Securities Exchange Act of 1934, SCBT
Financial Corporation's directors and executive officers are required to report
periodically their ownership of SCBT Financial Corporation stock and any changes
in ownership to the Securities and Exchange Commission. Based on a review of
forms 3, 4 and 5 and written representations made to the Company, it appears,
except as discussed below, that all such reports for these persons were filed in
a timely fashion in 2004.

On May 7, 2004, Thomas E. Suggs, a director, purchased 200 shares of the
Company's common stock. A transaction report on Form 4 was not filed until May
19, 2004. On September 16, 2004, James A. Shuford, III, an executive officer,
sold 600 shares of the Company's common stock. A transaction report on Form 4
was not filed until October 27, 2004.

INDEPENDENT ACCOUNTANTS

The audit committee has appointed J. W. Hunt and Company, LLP, independent
certified public accountants, as independent auditors for the Company and its
subsidiaries for the current fiscal year ending December 31, 2005, subject to
ratification by the Company's shareholders. J. W. Hunt and Company, LLP has
advised the Company that neither the firm nor any of its partners has any direct
or material interest in the Company and its subsidiaries except as auditors and
independent certified public accountants of the Company. Representatives of J.W.
Hunt and Company, LLP are expected to be at the Annual Meeting, will have the
opportunity to make a statement if they desire to do so and will be available to
respond to appropriate questions.

AUDIT COMMITTEE REPORT

The Audit Committee oversees the Company's financial reporting process,
including internal controls, on behalf of the board of directors. The Committee
is composed of six directors of the Company, each of whom is independent as
defined by the rules of The Nasdaq Stock Market applicable to directors who
serve on the Audit Committee. The Audit Committee operates under an audit
committee charter that complies with the requirements regarding audit committees
established by the Sarbanes-Oxley Act of 2002 and the rules and regulations of
the Securities and Exchange Commission and The Nasdaq Stock Market.

Management has the primary responsibility for the Company's financial
statements, internal controls, and financial reporting. The Company's
independent auditors are responsible for expressing an opinion on the conformity
of the Company's audited financial statements to generally accepted accounting
principles and the conformity of the Company with maintaining internal controls
over financial reporting as specified by the Sarbanes Oxley Act of 2002.

In the context of its responsibilities, the Audit Committee met with
management and the independent auditors to review and discuss the December 31,
2004 audited financial statements. The Audit Committee discussed with the
independent auditors the matters required by Statement on Auditing Standards No.
61 (Communication with Audit Committees). In addition, the Audit Committee has
received from the independent auditors the written disclosures and letter
required by Independence Standards Board No. 1 (Independence Discussion with
Audit Committees) and discussed with them their independence from the Company
and its management. The Audit Committee also has considered whether the
independent auditor's provision of non-audit services, as set forth in "Audit
and Other Fees" below, is compatible with the auditor's independence.

Based on the reviews and discussions referred to above, the Audit Committee
has determined to recommend to the board of directors that the audited financial
statements be included in the Company's Annual Report on SEC Form 10-K for the
year ended December 31, 2004, for filing with the Securities and Exchange
Commission.

o Audit Committee o

M. Oswald Fogle, Chairman Luther J. Battiste, III Ralph W. Norman

Susie H. VanHuss John W. Williamson, III Cathy Cox Yeadon

AUDIT AND OTHER FEES

The following listing presents the aggregate fees billed by J. W. Hunt and
Company, LLP, the Company's independent auditor, during 2004 and 2003 for (i)
audit fees, (ii) audit-related fees, (iii) tax fees and (iv) all other fees:

-----------------------------------------------------------------------
2004 2003
-----------------------------------------------------------------------
Audit Fees $209,891 $165,886
-----------------------------------------------------------------------
Audit Related Fees(1) 12,000 18,164
-----------------------------------------------------------------------
Tax Fees(2) 33,609 26,576
-----------------------------------------------------------------------
All Other Fees(3) 38,851 21,409
-----------------------------------------------------------------------

(1) Audit-related fees are for services rendered in connection with attesting
to internal controls over financial reporting in accordance with the
Federal Deposit Insurance Corporation Improvement Act of 1991.
(2) Tax fees are for services rendered primarily in connection with the
preparation of federal and state income and bank tax returns, calculation
of quarterly estimated income tax payment amounts and research associated
with various tax-related issues that affect the Company.

(3) All other fees are for accounting research and assistance related to actual
or proposed transactions that involve unusual or complex elements.

PRE-APPROVAL POLICY

The Audit Committee's policy is to pre-approve all audit and non-audit
services provided by the independent auditors. Under the policy, and in
accordance with the Sarbanes-Oxley Act of 2002, the Audit Committee may delegate
pre-approval authority to one or more of its members. However, any member to
whom such authority is delegated is required to report on any preapproval
decisions to the Audit Committee at its next scheduled meeting. The Audit
Committee did not fail to pre-approve any of the services provided by J. W. Hunt
& Company, LLP during 2004.

AVAILABILITY OF ANNUAL REPORT ON FORM 10-K

The Company is mailing to shareholders contemporaneously with these proxy
materials a copy of its Annual Report on Form 10-K for the year ended December
31, 2004, filed with the Securities and Exchange Commission. Further inquiries
regarding the Form 10-K should be directed to: SCBT Financial Corporation, P.O.
Box 1030, Columbia, South Carolina 29202, attention: Veronica H. Bailey, Manager
of Corporate Accounting.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Colden R. Battey, Jr., a director, is a partner in the law firm of Harvey
and Battey, PA, which South Carolina Bank and Trust, N.A. engaged as counsel for
certain transactions during 2004 and may engage during the current fiscal year.
Mr. Battey also has a 20% interest in a partnership that leases an office
building to South Carolina Bank and Trust, N.A. in Beaufort, South Carolina.
Annual lease payments to the partnership under this lease are approximately
$138,950. No current or former officer, and no other member of the Compensation
Committee, has directly or indirectly entered into any transactions with the
Company of a nature that would be required to be disclosed in this Proxy
Statement.

OTHER BUSINESS

The Company does not know of any other business to be presented at the
Annual Meeting. If any other matters are properly brought before the Annual
Meeting, however, it is the intention of the persons named in the accompanying
proxy to vote such proxy in accordance with their best judgment.

APPENDIX A
GOVERNANCE COMMITTEE CHARTER
Adopted as of April 27, 2004

PURPOSE

The Governance Committee has been created by the Board of Directors of SCBT
Financial Corporation to assist the Board by identifying individuals qualified
to become Board members, and to recommend to the Board nominees for director; to
review the corporate governance practices employed by the Company and to
recommend changes thereto; to make other recommendations to the Board relating
to corporate governance, and to assist the Board in its periodic review of the
Board's performance.

COMMITTEE MEMBERSHIP

The Governance Committee shall consist of no fewer than three members. The
members of the Governance Committee shall meet the independence requirements of
the NASDAQ Stock Market (provided, however, that failure of any member to meet
such requirements shall not invalidate or otherwise affect any action by the
Governance Committee) and such other standards as may be established by the
Governance Committee or the Board.

The members of the Governance Committee shall be appointed by the Board.

COMMITTEE AUTHORITY AND RESPONSIBILITIES

1. The Governance Committee shall have the authority to review the structure
of the Board, its committee structure and overall size.

2. The Governance Committee shall have the authority to develop, and recommend
for Board approval, standards for director independence.

3. After considering the recommendation of the Chairman of the Board, the
Governance Committee shall recommend annually to the Board of Directors the
directors for appointment to the committees of the Board.

4. The Governance Committee shall identify individuals qualified to become
board members, evaluate and recommend to the Board possible candidates for
director. Criteria that shall be used in connection with selecting
candidates shall include factors relating to whether the candidate would
meet the applicable definition of independence, as well as age, skills,
occupation, diversity, experience and other factors beneficial to the
Company in the context of the needs of the Board. When evaluating
candidates recommended by others (including shareholders of the Company),
the Governance Committee may also consider whether the candidate would
represent the interests of all shareholders and not serve for the purpose
of favoring or advancing the interests of any particular shareholder group
or other constituency.

5. In identifying director candidates, the Governance Committee may consider
recommendations from other members of the Board or any other sources it
deems appropriate. It is the Governance Committee's policy to consider
candidates recommended by shareholders in accordance with Section 6 below.

6. To be considered by the Governance Committee, any recommendation by a
shareholder or shareholder group of a candidate for director must be
addressed to the Governance Committee and must contain all of the following
information about the recommended candidate:

- the information required by Item 401 of SEC Regulation S-K (generally
providing for disclosure of the name, address, any arrangements or
understanding regarding nomination and five year business experience
of the recommended candidate, as well as information regarding certain
types of legal proceedings within the past give years involving the
candidate);

- the information required by Item 403 of SEC Regulation S-K (generally
providing for disclosure regarding the recommended candidate's
ownership of securities of the Company);

- the information required by Item 404 of SEC Regulation S-K (generally
providing for disclosure of transactions between the Company and the
recommended candidate valued in excess of $60,000 and certain other
types of business relationships with the Company);

- a description of all relationships between the recommended candidate
and the recommending shareholder or group and any agreements or
understandings between the recommending shareholder or group and the
candidate regarding the nomination;

- a description of all known relationships between the recommended
candidate and any of the Company's competitors, customers, business
partners or other persons who have a business relationship with the
Company; and

- a statement of the recommended candidate's qualifications for Board
membership.

7. The Governance Committee's process for evaluating director candidates for
recommendation to the Board shall begin with a preliminary assessment of
each candidate based on the individual's biographical information,
willingness to serve and other background information. This information
shall be evaluated against the criteria for selecting director candidates
described above. After these preliminary assessments, a candidate may be
invited to participate in a series of interviews to constitute the
evaluation process, provided that incumbent directors generally shall not
be required to interview again. On the basis of the information learned
during this process, the Governance Committee shall determine which
candidates to recommend to the Board for nominations.

8. The Governance Committee shall have the authority to retain and terminate
any search firm to be used to identify director candidates and shall have
authority to approve the search firm's fees and other retention terms.

9. The Governance Committee shall determine a schedule for regular executive
sessions in which independent directors meet without non-independent
directors present. The chair of the Committee shall preside over those
sessions.

10. The Governance Committee shall report periodically to the Board with an
assessment of the Board's performance and shall assist the Board in the
evaluation of Board and in the evaluation of individual directors, which
may include developing a periodic self-evaluation process.

11. The Governance Committee shall periodically review and reassess the
adequacy of the corporate governance practices of the Company and recommend
any proposed changes to the Board for approval.

12. The Governance Committee shall periodically review and reassess the
adequacy of the Company's ethics policies and the Board of Directors
Corporate Governance Guidelines and recommend any proposed changes to the
Board for approval.

13. The Governance Committee shall review and reassess the adequacy of this
Charter annually and recommend any proposed changes to the Board for
approval. The Governance Committee shall annually review its own
performance in relationship to its charter.

P R O X Y
SCBT FINANCIAL CORPORATION

Proxy Solicited on Behalf of the Board of Directors
for 2005 Annual Meeting of Shareholders

Robert R. Hill, Jr. and Richard C. Mathis, or either of them, with full
power of substitution, are hereby appointed as agent(s) of the undersigned to
vote as proxies all of the shares of Common Stock of SCBT Financial Corporation
held of record by the undersigned on the record date at the annual meeting of
shareholders to be held on April 26, 2005, and at any adjournment thereof, as
follows:

1. ELECTION OF DIRECTORS:

Luther J. Battiste, III, Robert R. Hill, Jr., Ralph W. Norman, Susie H. VanHuss,
A. Dewall Waters

o FOR all nominees listed above (except o WITHHOLD AUTHORITY to vote for all
any I have written below) nominees listed above

INSTRUCTION: To withhold authority to vote for any individual(s), write the
nominee's(s') name(s) on the line below.

--------------------------------------------------------------------------------
2. PROPOSAL TO RATIFY APPOINTMENT OF J. W. HUNT AND COMPANY, LLP, CERTIFIED
PUBLIC ACCOUNTANTS, AS SCBT FINANCIAL CORPORATION'S INDEPENDENT AUDITORS FOR
2005:
o FOR o AGAINST o ABSTAIN
(Continued and to be dated and signed on reverse side)

3. And, in the discretion of said agents, upon such other business as may
properly come before the meeting, and matters incidental to the conduct of
the meeting.

THE PROXIES WILL BE VOTED AS INSTRUCTED. IF NO CHOICE IS INDICATED WITH
RESPECT TO A MATTER WHERE A CHOICE IS PROVIDED, THIS PROXY WILL BE VOTED
""FOR" SUCH MATTER.

Sign exactly as your name or names appear.
When signing in a representative capacity,
give title such as Trustee, Personal
Representative, or President.

Date:________________________________, 2005

___________________________________________
Shareholder sign here

___________________________________________
Co-owner sign here

DO YOU HAVE ANY COMMENTS?
___________________________________________
___________________________________________
___________________________________________

PLEASE NOTE ANY ADDRESS CHANGE ABOVE.