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Greene County Bancorp, Inc. Announces Earnings and Anniversary

^{Published on 2009-01-21 15:01:34, Last Modified on 2009-11-02 11:25:40 - Market Wire}
 

CATSKILL, N.Y.--([ BUSINESS WIRE ])--Greene County Bancorp, Inc. (the "Company") (NASDAQ: GCBC), the holding company for The Bank of Greene County and its subsidiary Greene County Commercial Bank, today reported net income for the six months and quarter ended December 31, 2008. Net income for the six months ended December 31, 2008 amounted to $1.8 million or $0.45 per basic and diluted share as compared to $1.2 million or $0.29 per basic and diluted share for the six months ended December 31, 2007, an increase of $646,000, or 54.1%. Net income for the quarter ended December 31, 2008 amounted to $1.0 million or $0.25 per basic and diluted share as compared to $626,000 or $0.15 per basic and diluted share for the quarter ended December 31, 2007, an increase of $406,000, or 64.9%.

President and CEO, Donald Gibson, stated, "Our conservative operating style and knowledge and support of our local community have helped us to continue strong performance despite the recent faltering of some areas of the financial system."

The most significant factor contributing to the improved earnings was higher net interest income, which increased to $7.7 million for the six months ended December 31, 2008 as compared to $5.6 million for the six months ended December 31, 2007, an increase of $2.1 million or 38.4%. Net interest income increased to $4.0 million for the quarter ended December 31, 2008 as compared to $2.8 million for the quarter ended December 31, 2007, an increase of $1.2 million or 42.9%. Net interest rate spread increased 64 basis points to 3.60% for the six months ended December 31, 2008 as compared to 2.96% for the six months ended December 31, 2007. Net interest rate spread increased 63 basis points to 3.55% for the quarter ended December 31, 2008 as compared to 2.92% for the quarter ended December 31, 2007. Net interest margin increased 40 basis points to 3.89% for the six months ended December 31, 2008 as compared to 3.49% for the six months ended December 31, 2007. Net interest margin increased 36 basis points to 3.81% for the quarter ended December 31, 2008 as compared to 3.45% for the quarter ended December 31, 2007.

The provision for loan losses amounted to $613,000 and $278,000 for the six months ended December 31, 2008 and 2007, respectively, an increase of $335,000 or 120.1%. The provision for loan losses amounted to $418,000 and $135,000 for the quarters ended December 31, 2008 and 2007, respectively, an increase of $283,000. The increase in the level of provision was partially a result of growth in the loan portfolio and an increase in the amount of loan charge-offs. Net charge-offs amounted to $293,000 and $70,000 for the six months ended December 31, 2008 and 2007, respectively, an increase of $223,000. The increase in the level of charge-offs reflected the decline in the overall economy. As a result the level of allowance for loan losses to total loans receivable has been increased to 0.84% as of December 31, 2008 as compared to 0.76% as of December 31, 2007. Management will continue to closely monitor asset quality and adjust the level of the allowance for loan losses as judged necessary.

Noninterest income remained flat at approximately $2.2 million for the six-month periods and $1.2 million for the quarters ended December 31, 2008 and 2007. Noninterest income for the six months ended December 31, 2008 reflected an impairment charge of $220,000 ($135,000 net of tax) related to the other-than-temporary impairment of a Lehman Brothers Holdings, Inc. debt security held by the Company.

Noninterest expense increased $659,000 or 11.3% to $6.5 million for the six months ended December 31, 2008 as compared to $5.9 million for the six months ended December 31, 2007. Noninterest expense increased $204,000 or 6.9% to $3.2 million for the quarter ended December 31, 2008 as compared to $2.9 million for the quarter ended December 31, 2007. The Company allocated $351,000 toward the expected future termination of its currently frozen defined benefit plan during the six months ended December 31, 2008. Additional expenses such as compensation and depreciation due to the new Chatham branch which opened in January 2008 also contributed to the higher noninterest expense.

Total assets grew $61.4 million or 16.2% to $441.0 million at December 31, 2008 as compared to $379.6 million at June 30, 2008. Securities classified as both available for sale and held to maturity increased $34.9 million to $147.1 million at December 31, 2008 as compared to $112.1 million at June 30, 2008. Loans increased $23.9 million or 10.0% to $264.1 million at December 31, 2008 as compared to $240.1 million at June 30, 2008. Funding the growth in assets was deposit growth of $60.0 million, or 18.7%, to $381.4 million at December 31, 2008 as compared to $321.4 million at June 30, 2008. The Company has recently attracted new local municipalities including school districts to use the services of Greene County Commercial Bank, which is a special-purpose entity for such activities. Greene County Commercial Bank has sought core deposits from such entities rather than more expensive time accounts. The level of deposits held by such public entities can be cyclical and fluctuate significantly from quarter to quarter and are significantly dependent on and affected by tax collection periods or special projects such as new buildings or renovations. These types of local municipal entities are also required to have certain forms of collateral pledged for amounts deposited over the FDIC insurance limits.

Total shareholders' equity amounted to $38.1 million at December 31, 2008, or 8.6% of total assets.

Headquartered in Catskill, New York, the Company provides full-service community-based banking in its eleven branch offices located in Greene, Columbia and Albany Counties. On January 12, 2009, the Company opened its newest branch, located on Route 9W in Ravena in southern Albany County.

On January 22, 2009, the Company will celebrate the 120^th Anniversary of its founding. As part of the celebration on January 22^nd at 9:30 AM the Bank's Board of Directors and Senior Officers have been invited to the NASDAQ MarketSite Tower located in New York's Time Square to ring the opening bell.

Customers are offered 24-hour services through ATM network systems, an automated telephone banking system and Internet Banking through its web site at [ http://www.tbogc.com ].

This press release contains statements about future events that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, general economic conditions, changes in interest rates, regulatory considerations, competition, technological developments, retention and recruitment of qualified personnel, and market acceptance of the Company's pricing, products and services.