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Exhibit 99.1

UNION BANKSHARES REPORTS INCREASE IN 3rd QUARTER EARNINGS

FOR IMMEDIATE RELEASE (Bowling Green, Virginia)—Union Bankshares (Nasdaq: UBSH—News) is pleased to report net income for the quarter ended September 30, 2003 of $4,195,000, an increase of 4.6 % from $4,011,000 a year ago. Earnings per share on a diluted basis increased by 5.8% to $.55 from $.52 for the same quarter in 2002. Return on average equity for the quarter was 14.66%, and return on average assets for the same period was 1.37 %, as compared to 15.72% and 1.53%, respectively, for the third quarter of 2002.

For the nine months ended September 30, 2003, net income increased to $12.5 million from $10.5 million for the same period in 2002, an increase of 18.6%. Over this same period, earnings per share on a diluted basis increased 18.1% to $1.63 from $1.38 for the same period in 2002. Return on average equity for the nine months ended September 30, 2003 was 15.08%, while return on average assets for the same period was 1.43%, compared to 14.78% and 1.40% respectively, for the nine months ended September 30, 2002.

For the third quarter net income for the mortgage banking segment increased to $830,000, an increase of $375,000 or 82.4% from $455,000 in the same quarter of 2002. For the quarter, net income for the community banking segment was $3.4 million, a decrease of $191,000 or 5.4% from $3.6 million for the third quarter of 2002. For the nine months ended September 30, 2003, net income for the community bank segment increased to $10.2 million from $9.5 million at September 30, 2002 , while the mortgage segment increased to $2.3 million from $984,000 for the same period in 2002.

For the Company, net interest income was up $651,000 or 6.3% from the third quarter of 2002. Average earning assets grew to $1.141 billion compared to $979.2 million in the prior year quarter providing the Company with a higher earnings base compared to last year. This volume growth offset a decrease of 43 basis points in the net interest margin (FTE) which decreased to 4.03% in the third quarter of 2003, down from 4.46% in the same quarter of 2002, and down from 4.20% in the second quarter of 2003.

Loans increased 21.9% or $150.6 million from the third quarter of 2002 and 17.1% or $122.2 million from the end of 2002. Loans for the third quarter compared to the second quarter of 2003 increased 6.1% or $48.2 million. Yields on loans (FTE) decreased from 7.37% during the third quarter of 2002 and from 6.81% in the second quarter 2003 to 6.45% for the third quarter of 2003. The cost of funds also declined, from 2.99% in the third quarter of 2002 and 2.70% for the second quarter of 2003 to 2.53% in the third quarter of 2003. Loan yields declined by 36 basis points between the second and third quarters of 2003 while deposits and other borrowings declined by only 17 basis points which led to the narrowed margin. Deposit levels were up $137.1 million, or16.1%, from the third quarter of 2002 and $31.1 million, or 3.3%, from the second quarter of 2003.

For the quarter ended September 30, 2003, the provision for loan losses was $903,000 up $253,000 from $650,000 a year earlier. This increased provision is attributable to strong loan growth and the impact of a single credit relationship reported in the second quarter of 2003. At the end of June, two credits totaling $8.1 million were placed on non-accrual status with $550,000 in loan loss reserves allocated. The Company continues to work with the borrower to protect its interest, but has allocated an additional $335,000 in loan loss reserves to this relationship. Despite this problem asset, overall asset quality remains strong. At September 30, 2003, nonperforming assets totaled $9.5 million, but $1.4 million excluding the above credit. The allowance for loan losses is up slightly at 1.32% of gross loans from 1.30% a year earlier.

Noninterest income for the third quarter increased $2.0 million or 41.5% from a year ago and reflected a $1.4 million or 49.8% increase in gains on sales of loans. Service charges on deposit accounts showed an increase of $600,000 or 55.6% for the same period, reflecting the 25.9% increase in noninterest bearing deposit accounts and a full quarter’s impact of a new overdraft protection product introduced during the prior quarter.

Noninterest expense for the third quarter 2003 increased by $1.9 million or 20.9% from a year ago while assets grew by 13.6%. A significant portion of the growth in expenses was related to increased commissions ($663,000) on mortgage loan sales and to expenses associated with both the Thornburg branch which opened in August 2002, the loan production offices in Manassas and Richmond and new product advertisements. The Company continues to focus on expense controls to create greater operating efficiencies as it grows, but realizes that infrastructure growth and market expansion in the future will impact expenses before adding meaningful income.

“We are pleased with the overall performance of the Company for the first nine months of 2003, particularly in a challenging economic environment”, said President G. William Beale. “Our mortgage segment has produced tremendous results and favorably impacted the Corporation’s profitability again in the third quarter. The community bank segment continues to report strong profits amid a number of growth initiatives.

“As expected, the movement in long-term rates slowed mortgage loan production in September and we expect it will reduce net income in the mortgage segment in the fourth quarter of 2003. Refinance activity accounted for 48% of our $171 million in mortgage originations during the quarter, down from 55% in the second quarter. These refinance levels are less than industry averages and reflect a greater focus by our lenders on recurring business with builders and realtors which we hope will translate to continued strong levels of non-refinance originations.

“The community banking sector has continued to perform well. The effect of the final rate cut by the Fed was absorbed by reduced asset yields in the third quarter. Strong competition for loan assets, driven by excess liquidity in banks also diluted bank asset yields. We expect the net interest margin to be stable during the fourth quarter and, because our balance sheet is currently asset sensitive, the margin should improve in a rising rate environment.

“We continue to invest in people and additional locations to take advantage of opportunities created by recent mergers in our market. These include a new full-service branch at Parham and Three Chopt, adjacent to our Loan Production Office, which received regulatory approval in August and is expected to open in late 2003. We have also leased space in a Fas Mart convenience store located on Pouncey Tract Road also in the West End of Richmond and, subject to regulatory approval, expect to open it in November 2003. While we expect these initiatives and the previously announced branch additions on Pole Green Road and on Rt 360 in Mechanicsville to create some short-term drag on earnings, we expect they will contribute greatly to the long term growth and profitability of our Company.”

At September 30, 2003 total assets were $1.215 billion, up 13.6% from $1.070 billion at September 30, 2002. Deposits increased to $989.2 million, up $137.1 million or 16.1% over $852.1 million at the end of the third quarter 2002 while loans totaled $837.0 million, up $150.6 million or 21.9% over third quarter 2002 levels. Securities declined to $239.4 million at September 30, 2003 compared to $265.6 million a year earlier. The Company’s capital position remains strong with an equity-to-assets ratio of 9.5 %.

Union Bankshares is one of the largest community banking organizations based in Virginia, providing full service banking to the Central, Rappahannock, Williamsburg and Northern Neck regions of Virginia through its bank subsidiaries, Union Bank & Trust (19 locations in the counties of Caroline, Hanover, King George, King William, Spotsylvania, Stafford, Westmoreland and the City of Fredericksburg), Northern Neck State Bank (9 locations in the counties of Richmond, Westmoreland, Essex, Northumberland and Lancaster), Rappahannock National Bank in Washington, Virginia and Bank of Williamsburg in Williamsburg and Newport News. Union Bank & Trust also operates loan production offices in Manassas and Richmond, Virginia. The new Richmond Loan Production Office is located at Parham and Three Chopt Roads, close to the Regency Square shopping mall. In addition, Union Investment Services, Inc. provides full brokerage services and Mortgage Capital Investors provides a full line of mortgage products.

This press release may contain “forward-looking statements,” within the meaning of federal securities laws, that involve significant risks and uncertainties. Statements herein are based on certain assumptions and analyses by the Company and are factors it believes are appropriate in the circumstances. Actual results could differ materially from those contained in or implied by such statements for a variety of reasons including, but not limited to: changes in interest rates; changes in accounting principles, policies, or guidelines; significant changes in economic conditions; significant changes in regulatory requirements; and significant changes in securities markets. Consequently, all forward-looking statements made herein are qualified by these cautionary statements and the cautionary language in the Company’s most recent Form 10-K report and other documents filed with the Securities and Exchange Commission. Union Bankshares Corporation does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.

Union Bankshares Corporation

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Union Bankshares Corporation

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