Our Name is Our Mission

Dear Fellow Stockholder,

2009 proved to be an interesting year, but not as profitable as we would have liked. If ServisFirst Bancshares were an eight-cylinder engine, I would say that we were hitting on about six cylinders for most of the year.

I will cover the negatives first. On the expense side, two categories went up - FDIC premiums and credit-related expenses. FDIC premiums for all banks went up dramatically in 2009, and we have no control over that line item. Unfortunately, our stockholders are paying for the poor management of the failed banks and thrifts in the U.S. The other line item, credit-related costs, is entirely our fault. While our credit-related expenses were well below our peer group, they were high by historical standards for a well managed bank. In hindsight, we lent money to some developers and builders who had little liquidity, and I hope we remember this when the good times roll again in the building and development business.

Now let me tell you the good news of 2009. Our deposit growth was tremendous as we benefited from a “flight to quality” from customers of our stressed competitors. We were fortunate to have solid growth in new core relationships that we believe will benefit our stockholders for many years. The downside of this deposit influx is that we could not identify good loans as quickly as the deposits came in, so we had negative earnings on this growth for most of 2009.

Our Dothan Region opened its new main office in 2009, and enjoyed solid growth in 2009. In fact, our Dothan Region has the highest market share of any of our regions, with Birmingham having the lowest. If all of our regions achieve a market share of 10%, which is possible over time, we will be a $5 billion bank with no additional geographic expansion. We are proud of our seventeen consecutive quarters of profitability, which very few of our peers can say, much less those that are less than five years old. While we have felt a little of the pain that has hit the banking industry, the opportunities that it has created for ServisFirst are greater than I would have ever imagined possible. No one could have written a book as bizarre as the true events in our industry over the past two years.

As you know, we are a public, non-traded company and file reports with the Securities and Exchange Commission like all public companies. We have made a decision not to forecast future earnings because we believe ”the proof of the pudding is in the eating.” While we have achieved some national recognition recently, of which we are proud, I can assure you that we are never satisfied with our performance, and all of our 160 employees will continue to work hard to build stockholder value.

Thomas A. Broughton III

Director, President and

Chief Executive Officer

CONSOLIDATED FINANCIAL HIGHLIGHTS

													As of and for the period
	As of and for the years ended December 31,												from 05/02/05 (date of
	2009			2008			2007			2006			inception) to 12/31/05
	(Dollars in thousands except for share and per share data)
Selected Balance Sheet Data:
Total assets	$	1,573,497		$	1,162,272		$	838,250		$	528,545		$	277,963
Total loans		1,207,084			968,233			675,281			440,489			249,250
Loans, net		1,192,173			957,631			667,549			435,071			246,140
Securities available for sale		255,453			102,339			87,233			28,119			924
Securities held to maturity		645			0			0			0			0
Cash and due from banks		26,982			22,844			15,756			15,706			4,188
Interest-bearing balances with banks		48,544			30,774			34,068			22			—
Fed funds sold		680			19,300			16,598			37,607			20,725
Mortgage loans held for sale		6,202			3,320			2,463			2,902			1,778
Restricted equity securities		3,241			2,659			1,202			805			230
Premises and equipment, net		5,088			3,884			4,176			2,605			1,400
Deposits		1,432,355			1,037,319			762,683			473,348			244,048
Other borrowings		24,922			20,000			73			—			—
Trust preferred securities		15,228			15,087			—			—			—
Other liabilities		3,370			3,082			2,465			2,353			273
Stockholders’ equity		97,622			86,784			72,247			52,288			33,469
Selected Income Statement Data:
Interest income	$	62,197		$	5,450		$	51,417		$	30,610		$	6,580
Interest expense		18,337			20,474			25,872			13,335			2,325
Net interest income		43,860			34,976			25,545			17,275			4,255
Provision for loan losses		10,860			6,274			3,541			3,252			3,521
Net interest income after provision for loan losses		33,000			28,702			22,004			14,023			734
Noninterest income		4,413			2,704			1,441			911			101
Noninterest expense		28,755			20,576			14,796			8,674			3,161
Income (loss) before income taxes		8,658			10,830			8,649			6,260			(2,326	)
Income taxes expenses (benefit)		2,780			3,825			3,152			2,189			(840	)
Net income (loss)		5,878			7,005			5,497			4,071			(1,486	)
Per Common Share Data:
Net income (loss), basic	$	1.07		$	1.37		$	1.19		$	1.06		$	(0.42	)
Net income (loss), diluted		1.02			1.31			1.16			1.06			(0.42	)
Book value		17.71			16.15			14.13			11.71			9.56
Weighted average shares outstanding:
Basic		5,485,972			5,114,194			4,631,047			3,831,881			3,500,000
Diluted		5,787,643			5,338,883			4,721,864			3,846,111			3,500,000
Actual shares outstanding		5,513,482			5,374,022			5,113,482			4,463,607			3,500,000
Selected Performance Ratios:
Return on average assets		0.43	%		0.71	%		0.78	%		1.02	%		(1.40	)%
Return on average stockholders’ equity		6.33	%		9.28	%		9.40	%		9.96	%		(6.65	)%
Net interest margin(1)		3.31	%		3.70	%		3.78	%		4.60	%		4.21	%
Efficiency ratio(2)		59.57	%		54.61	%		54.83	%		50.67	%		72.56	%
Asset Quality Ratios:
Net charge-offs to average loans outstanding		0.60	%		0.41	%		0.23	%		0.28	%		0.53	%
Non-performing loans to total loans		1.01	%		1.02	%		0.66	%		0.00	%		0.28	%
Non-performing assets to total assets		1.57	%		1.74	%		0.73	%		0.11	%		0.25	%
Allowance for loan losses to total gross loans		1.24	%		1.09	%		1.15	%		1.23	%		1.25	%
Allowance for loan losses to total non-performing loans		122.34	%		108.17	%		173.94	%		5,418.00	%		446.20	%
Liquidity Ratios:
Net loans to total deposits		83.23	%		92.32	%		87.53	%		91.91	%		100.86	%
Net average loans to average earning assets		80.06	%		85.84	%		77.19	%		89.34	%		76.35	%
Noninterest-bearing deposits to total deposits		14.75	%		11.71	%		11.15	%		15.05	%		20.40	%
Capital Adequacy Ratios:
Stockholders’ equity to total assets(3)		6.10	%		7.38	%		8.50	%		9.89	%		12.04	%
Total risk-based capital(4)		10.48	%		11.25	%		11.22	%		11.58	%		13.42	%
Tier I capital(5)		8.89	%		10.18	%		10.12	%		10.49	%		12.28	%
Leverage ratio(6)		6.97	%		9.01	%		8.40	%		10.32	%		14.32	%
Growth Ratios:
Percentage change in net income		-16.1	%		27.43	%		35.00	%		373.93	%		n/a
Percentage change in diluted net income per share		-22.5	%		12.93	%		13.21	%		352.38	%		n/a
Percentage change in assets		35.38	%		38.65	%		58.59	%		90.15	%		n/a
Percentage change in net loans		24.49	%		45.45	%		53.43	%		76.76	%		n/a
Percentage change in deposits		38.08	%		36.00	%		61.13	%		93.96	%		n/a
Percentage change in equity		12.49	%		20.12	%		38.18	%		56.23	%		n/a

1.	Net interest margin is the net yield on interest earning assets and is the difference between the interest yield earned on interest-earning assets and interest rate paid on interest-bearing liabilities, divided by average earning assets.

2.	Efficiency ratio is the result of noninterest expense divided by the sum of net interest income and noninterest income.

3.	Total stockholders’ equity excluding unrealized losses on securities available for sale, net of taxes, divided by total assets.

4.	Total stockholders’ equity excluding unrealized losses on securities available for sale, net of taxes, and intangible assets plus allowance for loan losses (limited to 1.25% of risk-weighted assets) divided by total risk-weighted assets. The FDIC required minimum to be well-capitalized is 10%.

5.	Total stockholders’ equity excluding unrealized losses on securities available for sale, net of taxes, and intangible assets divided by total risk-weighted assets. The FDIC required minimum to be well-capitalized is 6%.

Total stockholders’ equity excluding unrealized losses on securities available for sale, net of taxes, and intangible assets divided by average assets less intangible assets. The FDIC required minimum to be well-capitalized is 5%; however, the Alabama Banking Department has required that the Bank maintain a Tier 1 capital leverage ratio of 7%.

OFFICERS AND DIRECTORS

Principal Officers: ServisFirst Bancshares, Inc.

Thomas A. Broughton III

Chief Executive Officer and President,

ServisFirst Bancshares, Inc.

Executive Vice President, Chief Financial Officer,

Treasurer and Secretary,

ServisFirst Bancshares, Inc.

Clarence C. Pouncey III

Executive Vice President and Chief Operating Officer,

ServisFirst Bancshares, Inc.

Principal Officers: ServisFirst Bank

Thomas A. Broughton III

Chief Executive Officer and President,

Executive Vice President, Chief Financial Officer,

Treasurer and Secretary,

Clarence C. Pouncey III

Executive Vice President and Chief Operating Officer,

Executive Vice President and Montgomery President

and Chief Executive Officer,

Executive Vice President and Huntsville President

and Chief Executive Officer,

Executive Vice President and Dothan

and Chief Executive Officer,

Board of Directors: ServisFirst Bancshares, Inc.

Stanley M. Brock, Chairman of the Board

Thomas A. Broughton III

ServisFirst Bancshares, Inc.: Committees

Nominating and Corporate Governance

850 Shades Creek Parkway

Birmingham, Alabama 35209

Main Office Banking Center

850 Shades Creek Parkway

Birmingham, Alabama 35209

Downtown Banking Center

324 Richard Arrington Jr. Boulevard N.

Birmingham, Alabama 35203

Greystone Banking Center

Birmingham, Alabama 35242

Dothan Corporate Office & Banking Center

4801 West main Street

Huntsville Corporate Office & Downtown Banking Center

Huntsville, Alabama 35801

Research Park Banking Center

1267-A Enterprise way

Huntsville, Alabama 35806

Montgomery Corporate Office

Montgomery, Alabama 36104

Montgomery Downtown Banking Center

Montgomery, Alabama 36104

Montgomery East Banking Center

Montgomery, Alabama 36116

STOCKHOLDER INFORMATION

The Annual Meeting of Stockholders of ServisFirst Bancshares, Inc. will be held at Dothan Country Club, 200 South Cherokee Avenue, Dothan, AL 36301 on Tuesday, May 4th, 2010 at 5:30 p.m., Central Daylight Time.

Form 10-K is ServisFirst Bancshares, Inc.’s annual report filed with the Securities and Exchange Commission. A copy of ServisFirst Bancshares, Inc.’s 10-K is included as part of this Annual Report, and additional copies may be obtained free of charge by writing to us at 850 Shades Creek Parkway, Suite 200, Birmingham, Alabama 35209, Attn.: Investor Relations.

Registrar and Transfer Company

Available Information

Our corporate website is www.servisfirstbank.com. We have direct links on this website to our Code of Ethics and the charters for our Audit, Compensation and Nominations and Corporate Governance Committees by clicking on the “Investor Relations” tab. We also have direct links to our filings with the Securities and Exchange Commission (SEC), including, but not limited to, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and any amendments to

these reports. You may also obtain a copy of any such report free of charge from us by requesting such copy in writing to 850 Shades Creek Parkway, Suite 200, Birmingham, Alabama 35209 Attn.: Investor Relations. This Annual Report and accompanying exhibits and all other reports and filings that we file with the SEC will be available for the public to view and copy (at prescribed rates) at the SEC’s Public Reference Room at 100 F Street, Washington, D.C. 20549. You may also obtain copies of such information at the prescribed rates from the SEC’s Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains a website that contains such reports, proxy and information statements, and other information as we file electronically with the SEC by clicking on http://www.sec.gov.

Independent Registered Public Accounting Firm

Mauldin & Jenkins, LLC

2000 Southbridge Parkway

Birmingham, Alabama 35209

Haskell Slaughter Young & Rediker, LLC

1400 Park Place Tower

2001 Park Place North

Birmingham, Alabama 35203

ServisFirst Bancshares, Inc.

850 Shades Creek Parkway

Birmingham, AL 35209

Toll Free: 866.317.0810

www.servisfirstbank.com

Our Name – is Our Mission