AT&T Selected by Sterling Bank to Increase Data Speeds

$5.2 Million Networking Contract Ensures That Customers Will Have Real-Time Access to Financial Data

Houston, Texas, September 25, 2006

AT&T Inc. (NYSE:T) today announced that AT&T has won a five-year $5.2 million networking contract from Sterling Bank, a leading Texas-based bank. The agreement renews and expands a long-standing relationship between the two companies.

AT&T will provide a Multiprotocol Label Switching (MPLS)-based Internet Protocol Virtual Private Network (IP VPN) solution that will integrate Sterling Bank's 40 branches in the Houston, Dallas, and San Antonio metropolitan areas, as well as its corporate office in Houston and its data center in central Texas. Sterling Bank serves the banking needs of small to midsized businesses and consumers with an emphasis on personal customer service.

AT&T's high speed IP VPN solution enables Sterling Bank to conduct transactions more quickly and efficiently while enhancing data security. The AT&T solution also integrates Sterling Bank's online banking, allowing customers to conveniently access real-time account information online at any time during the day. A recent study found that the number of online-banking customers grew to nearly 40 million during the fourth quarter of 2005, a 27 percent increase over the previous year.

AT&T's solution also speeds Sterling's loan processing and approvals and improves its branch-to-branch communications. The IP VPN solution provides a high-quality and highly secure communications environment for Sterling Bank's mission-critical network, giving bank employees access to company information, proprietary applications and databases while delivering operating efficiencies.

"By enabling Sterling Bank customers to make transactions more quickly and gain real-time access to accurate information about their accounts, AT&T's networking solutions are helping us strengthen our well-established reputation for providing personalized customer service," said David Throgmorton, chief technical officer of Sterling Bank. "These networking technologies also aid in our business-continuity and data-security initiatives, which are critical service issues for our customers."

AT&T also will deliver OPT-E-MAN® managed metropolitan optical transport service, a switched Ethernet service that connects local area networks within the same metropolitan area. OPT-E-MAN will enable Sterling Bank to employ switched metro Ethernet technology to link facilities scattered throughout a geographic region to a single managed network. This ensures virtually uninterrupted data transportation from point-to-point, point to multipoint and multipoint to multipoint.

In addition to data services, AT&T provides Sterling Bank with a full range of voice, Internet access and teleconferencing services.

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About AT&T
AT&T Inc. is one of the world's largest telecommunications holding companies and is the largest in the United States. Operating globally under the AT&T brand, AT&T companies are recognized as the leading worldwide providers of IP-based communications services to business and as leading U.S. providers of high speed DSL Internet, local and long distance voice, and directory publishing and advertising services. AT&T Inc. holds a 60 percent ownership interest in Cingular Wireless, which is the No. 1 U.S. wireless services provider with 57.3 million wireless customers. Additional information about AT&T Inc. and AT&T products and services is available at www.att.com.

About Sterling Bank
Sterling Bank is a leader in banking for business owners in Texas with 40 offices serving the metropolitan areas of Houston, San Antonio and Dallas. In 2005, Sterling received its second "Best" Award from the American Society of Training and Development, and was listed by the Houston Business Journal as one of the best places to work in Houston. Sterling has grown to $3.7 billion in assets since going public in 1992 with assets of $265 million. It is a wholly-owned subsidiary of Sterling Bancshares, Inc., which trades its common stock through the Nasdaq Global Select Market System under the symbol SBIB. For more information, please visit www.banksterling.com.

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