GS Financial (GSLA) 10-K/A 2000 FY Annual report (amended)

United StatesSecurities and Exchange CommissionWashington, D.C. 20549Form 10-K/AAmendment No. 1

x Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended December 31, 2000

Commission File Number: 0-22269

GS Financial Corp.(Exact Name of Registrant as Specified in its Charter)

Louisiana	72-1341014
(State or Other Jurisdiction	(IRS Employer ID Number)
of Incorporation or Organization)

3798 Veterans Blvd.Metairie, LA 70002(Address of Principal Executive Offices)

Registrant's Telephone Number: (504) 457-6220

Securities registered pursuant to Section 12(g) of the Act:Common Stock, par value $.01 per share(Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

x Yes No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ____

As of March 8, 2001, there were 1,938,646 shares of the Registrant’s common stock, par value $.01 per share, issued and outstanding. The aggregate market value of such stock, excluding the shares held by all directors and officers of the Registrant, was $20.5 million at March 8, 2001 based on the per common share price at closing of $14.63 on that date. The information presented in this Form 10-K at December 31, 2000 and 1999, and for the twelve months ended December 31, 2000, 1999, and 1998 represent the financial condition and results of operations of GS Financial Corp. and its wholly-owned subsidiary, Guaranty Savings & Homestead Association.

DOCUMENTS INCORPORATED BY REFERENCE

Listed hereunder are the following documents which have been incorporated by reference and the Part of the Form 10-K into which the document is incorporated.

(1)	Portions of the Annual Report to Shareholders for the fiscal year ended December 31, 2000 are incorporated into Part II, Items 5 through 8, and Part IV, Item 14.
(2)	Portions of the definitive proxy statement for the 2001 Annual Meeting of Shareholders to be filed within 120 days of the Registrant’s fiscal year end are incorporated into Part III, Items 10 through 13.

PART I.

Item 1 of the Form 10-K is hereby amended and restated in its entirety to read as follows:

Item 1. BUSINESS

In addition to historical information, this Annual Report on Form 10-K includes certain "forward-looking statements," as defined in the Securities Act of 1933 and the Securities Exchange Act of 1934, based on current management expectations. The Company’s actual results could differ materially from those management expectations. Such forward-looking statements include statements regarding the Company’s intentions, beliefs or current expectations as well as the assumptions on which such statements are based. Stockholders and potential stockholders are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Factors that could cause future results to vary from current management expectations include, but are not limited to, general economic conditions, legislative and regulatory changes, monetary and fiscal policies of the federal government, changes in tax policies, rates and regulations of federal, state and local tax authorities, changes in interest rates, deposit flows, the cost of funds, demand for loan products, demand for financial services, competition, changes in the quality or composition of the Company’s loan and investment portfolios, changes in accounting principles, policies or guidelines, and other economic, competitive, governmental and technological factors affecting the Company’s operations, markets, products, services and fees. The Company undertakes no obligation to update or revise any forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

General

GS Financial Corp. (the "Company") was incorporated under Louisiana law on December 24, 1996 as a thrift holding company. The Company commenced operations on April 1, 1997 upon the completion of its initial public offering of common stock, which trades on the Nasdaq National Market. On that date the Company’s wholly owned subsidiary, Guaranty Savings and Homestead Association (the "Association") was converted from a Louisiana chartered mutual savings and loan association to a Louisiana chartered stock savings and loan association. This was accomplished through the offer and sale of common stock by the Company to certain depositors, employees, officers and directors of the Association as well as the GS Financial Employee Stock Ownership Plan (the "ESOP"). The Company simultaneously used a portion of the proceeds of its sale of common stock to acquire 100% of the stock of the Association.

The Company's principal business is conducted through the Association. Guaranty Savings and Homestead Association was founded in New Orleans, Louisiana in 1937 as a mutual savings and loan association. The Association’s unconsolidated assets at December 31, 2000 totaled $151.2 million and comprise 98.5% of the total consolidated assets of the Company. The Association provides financial services primarily to individuals, mainly through the origination of mortgage loans on 1-4 family residences. The Association accepts deposits in the form of passbook savings, certificates of deposit, demand deposit accounts and individual retirement accounts. The Association also invests in short and long term liquid investments such as US Treasury and Agency securities, mortgage backed securities, overnight Federal Funds, money market investments and qualified thrift grade mutual funds. The balance of the consolidated assets includes $2.0 million in similar short and long term liquid investments, and $.3 million in fixed assets held exclusively at the Company level.

Regulation

The Company’s primary regulator is the Office of Thrift Supervision ("OTS"). The OTS regulates all thrifts and thrift holding companies whose deposits are insured by the Savings Association Insurance Fund ("SAIF") which is administered by the Federal Deposit Insurance Corporation ("FDIC"). The Company, by virtue of its state charter is also subject to the rules and regulations of the Louisiana Office of Financial Institutions ("OFI"). These two agencies currently examine the Company approximately every 18 months on an individual basis, relying on the examination report of the other agency on cycles, alternating when it is not their year to examine the Association. The nature of such examinations includes safety and soundness issues or compliance with applicable laws and regulations. The Association was last examined by the OFI as of September 30, 2000 and the Company was last examined by the OTS as of June 30, 1999.

As a public registrant the Company is subject to the rules and regulations of the Securities and Exchange Commission ("SEC"). The Company also is subject to the rules of the NASDAQ Stock Market.

The Association has been a member of the Federal Home Loan Bank of Dallas ("FHLB") since 1937. The Federal Home Loan Bank System is comprised of 12 regional banks which serve thrifts and banks by offering investment opportunities and sources of funds.

Lending Activities

Loan Portfolio Composition. The following table sets forth the composition of the Company’s loan portfolio by type of loan at the dates indicated (in thousands):

LOAN PORTFOLIO COMPOSITION

				December 31,
				2000		1999		1998		1997		1996
Real Estate Loans:
	One to Four
		Family Residential	$	71,092	$	67,424	$	61,562	$	52,528	$	42,660
	FHA and VA			52		140		237		358		511
	Construction			619		646		740		99		298
	Commercial Real Estate			1,006		1,377		1,157		471		430
	Other			1,453		446		201		123		145
				---------		---------		---------		---------		---------
		Total Real Estate Loans		74,222		70,033		63,897		53,579		44,044
Consumer Loans:
	Second Mortgage			52		84		119		172		273
	Loans on Deposits			237		367		337		244		183
				---------		---------		---------		---------		---------
		Total Consumer Loans		289		451		456		416		456
Commercial Loans				381		-		-		-		-
				---------		---------		---------		---------		---------
		Total Loans		74,892		70,484		64,353		53,995		44,500
Allowance for
	Loan Losses			(420)		(424)		(463)		(410)		(382)
Net Deferred Loan
	Origination Costs			8		6		5		3		7
				---------		---------		---------		---------		---------
Net Loans			$	74,480	$	70,066	$	63,895	$	53,588	$	44,125
				=====		=====		=====		=====		=====

Contractual Term to Final Maturities.The following table sets forth certain information as of December 31, 2000 regarding the dollar amount of loans maturing in the Company’s portfolio, based on the contractual date of the loan’s final maturity, before giving effect to net items. Demand loans and loans having no stated maturity are reported as due in one year or less. The amounts shown below do not reflect normal principal amortization; rather, the balance of each loan outstanding at December 31, 2000 is shown in the appropriate year of the loan’s final maturity. The actual maturity of loans varies primarily on prepayments which to a large extent depends on market interest rates. In general if prevailing market rates fall below those of the portfolio, prepayments accelerate. Conversely if market interest rates increase above portfolio rates early pay-offs tend to decrease.

Fixed rate loans receivable as of December 31, 2000 are scheduled to mature and adjustable rate loans are scheduled to re-price as follows (in thousands):

				Under One Year		One to Five Years		Over Five to Ten Years		Over 10 Years		Total
				------		------		------		------		------
Loans Secured by 1-4 Family
	Residential:
		Fixed Rate	$	65	$	2,054	$	9,740	$	59,233	$	71,092
Other Loans Secured by
	Real Estate:
		Fixed Rate		32		111		331		2,708		3,182
Commercial Fixed Rate				99		-		-		282		381
All Other Loans				237		-		-		-		237
				------		------		------		------		------
			$	433	$	2,165	$	10,071	$	62,223	$	74,892
				=====		=====		=====		=====		=====

Loan Origination Activity. The table below sets forth the Company’s total loan origination and reduction experience during the periods indicated. Historically, the Company has not purchased or sold any loans.

			December 31,
			2000		1999		1998		1997		1996
			-------		-------		-------		-------		-------
Loan Originations (in thousands):
	1-4 family residential	$	10,846	$	13,082	$	14,697	$	14,806	$	8,876
	Construction		1,514		1,004		1,610		726		823
	Commercial real estate		323		306		526		75		69
	Consumer		106		266		283		149		66
	Commercial		383		-		-		-		-
	Other Real Estate		568		263		732		165		235
			-------		-------		-------		-------		-------
Total Loan Originations			13,740		14,921		17,848		15,921		10,069
Loan principal
	repayments		(9,218)		(8,790)		(7,490)		(6,425)		(5,776)
Increase (decrease)
	due to other items		6		72		(51)		(33)		3
			-------		-------		-------		-------		-------
Net increase(decrease) in
	Loan portfolio	$	4,528	$	6,203	$	10,307	$	9,463	$	4,296
			======		======		======		======		======

Real Estate Lending Standards and Underwriting Policies. As of March 19, 1993, the Company was required to adopt and maintain written real estate lending policies that are consistent with safe and sound banking practices. The Company is in compliance with all such standards.

The lending activities of the Company are subject to written underwriting standards and loan origination procedures established by the Company's Board of Directors and Management. These standards and procedures are incorporated into the Company's Underwriting Standards and Lending Policy which are reviewed annually by the Board of Directors (the "Board"). The underwriting standards dictate the manner in which loan applications are accepted and processed. Such standards are written to comply with all applicable laws and regulations including but not limited to Truth-In-Lending (Regulation Z) and the Real Estate Settlement and Procedures Act ("RESPA"). These standards pertain to such issues as appraisal guidelines, disclosure requirements, credit criteria, complete applications, and title requirements. The Company requires appraisals from Board-approved state licensed and certified appraisers. The lending policy establishes the overall direction of the Company's lending activities within the community and forms the basis for setting underwriting standards which limit the Company's exposure to credit risk. Such factors include loan amount, debt to income ratios, collateral, and acceptable rates and terms.

Briefly stated, the loan process consists of applicants meeting with loan personnel and providing pertinent documentation, including but not limited to, requested loan amount, property description, security offered as collateral, intended down payments and an acceptable rate and term consistent with the Company's then current lending policy. Upon receipt of a favorable credit report, an appraisal is obtained with requisite documentation to support the property's stated market value. Upon completion the loan package is presented to the Loan Committee for consideration. All applicants receive written notification of the Committee’s decision to approve or deny the request. Approved loans are assigned to one of the Company's approved attorneys for closing. Actions of the Loan Committee are submitted to the Board of Directors for consideration and ratification on a monthly basis.

Loan applications are accepted at all three of the Company’s offices and forwarded to the Loan Committee which meets weekly. The Company requires a title insurance policy on all loans prior to closing.

The Company’s loan portfolio consists of conventional fixed rate mortgage loans on 1-4 family residential dwellings. The terms of these go up to 30 years. Currently, the minimum cash down payment is 20% of the lesser of purchase price or appraised value. The Company also makes loans on residential investment property, commercial real estate, condominiums and vacant ground. Terms and rates are commensurate with current market conditions and risk factors.

The Company originates and funds construction loans which subsequently convert to permanent, fixed rate mortgage loans. During the construction period, the company requires payment of interest only on the amount of principal drawn.

During 2000, the Company began offering commercial loans. These include loans secured by commercial real estate, inventory, equipment or receivables. These loans provide the Company an opportunity to offer additional services, attract new business and diversify its loan portfolio.

Loans are available to depositors of the Company secured by passbook savings or certificates of deposit at a rate 2 percentage points above the savings rate up to 90% of the face amount of a certificate of deposit or 90% of the current available balance of a passbook. The minimum amount on such loans is $1,000 and these loans are payable on demand subject to 30 days notice.

Asset Quality

General. The Company has adopted an asset classification policy which is designed to draw attention to assets before collection becomes a problem, thus maintaining the quality of the Company’s investment as an interest earning asset. The policy also insures the accurate reporting of the Company’s assets from a valuation standpoint.

All of the Company’s assets are reviewed on a quarterly basis. Payment histories as well as the value of the underlying collateral are reviewed and assessed in light of several risk factors. The most significant risk factor is the state of the local economy. A healthy economy is characterized by low unemployment which usually leads to strong real estate markets and the maintenance if not appreciation of underlying collateral values. Current interest rates and expectations of the movement thereof is also a significant risk factor. Low or falling interest rates can act to stimulate local real estate markets while also increasing prepayment speeds on existing assets. Rising or high interest rates usually slows down payments. The level of credit concentration the customer has with the Company is also a risk factor. Other risk factors include environmental factors which could impair the value of the underlying collateral of an asset or changes in federal and state regulations which might reduce the ability of the Company to collect all of the principal and interest owed to the Company.

The Company’s Watch List, comprising substandard and special mention assets is presented to the Board quarterly. Assets displaying tendencies which might hinder full collection of principal are classified as substandard. Such tendencies include but are not limited to late payments on loans or deterioration of the underlying collateral. Those loans classified substandard, for which a specific potential for loss has been identified, are considered "special assets." Assets classified as special mention are those not yet serious enough to merit the substandard classification but do require additional attention from management.

Loan collection efforts in the form of past due notices commence when loan payments are more than 15 days past due. Once a loan reaches 30 days past due status, the Company’s collection manager initiates personal contact with the borrower. When a loan becomes 90 days past due, the Company initiates foreclosure proceedings. At this point, loans are placed on non-accrual status. All interest and late charges due on such loans are reversed in the form of reserves for uncollectible interest and late charges.

Real estate acquired by the Company through foreclosure is classified as foreclosed real estate until such time as the property is sold. All such assets are booked at the lower of appraised value or cost which includes all principal, escrow overdrafts and attorney fees. All Foreclosed Real Estate is considered substandard.

Delinquent Loans and Non-Performing Assets. The following tables set forth the Company’s delinquent loans and non-performing assets as of the dates indicated. Balances are indicative of the total principal balances of such loans rather than the actual principal past due based on the number of payments past due. At December 31 of the five years presented, predominantly all of the Association’s delinquent loans and non performing assets were either 1-4 family residential dwellings or loans secured by 1-4 family residential loans.

  DELINQUENT LOANS(Dollars in thousands)

		2000		1999		1998		1997		1996
		-----		-----		-----		-----		-----
30-89 Days	$	2,231	$	2,673	$	2,171	$	271	$	175
90+ Days		434		100		266		166		253
		-----		-----		-----		-----		-----
Total Delinquent Loans	$	2,665	$	2,773	$	2,437	$	437	$	428
		====		====		====		====		====

During 1998, the Company changed its data processing parameters to include accounts exactly 30 days past due in the delinquent 30-89 day category. This accounts for the material increase in the amount of loans delinquent 30-89 days in 1998 through 2000 compared to 1997 and 1996.

Non Performing Assets(Dollars in thousands)

			2000		1999		1998		1997		1996
			-----		-----		-----		-----		-----
90+ Day Delinquent Loans		$	434	$	100	$	266	$	166	$	253
Foreclosed Real Estate			117		14		-		-		-
			-----		-----		-----		-----		-----
Total Non Performing Assets		$	551	$	114	$	266	$	166	$	253
			===		===		===		===		===
Non Performing Loans as
	a % of Total Loans		.58%		.14%		.42%		.31%		.57%
Non Performing Assets as
	a % of Total Assets		.28%		.06%		.17%		.13%		.29%

Classified Assets.The following table presents information pertaining to the Company’s Watch list of classified assets and associated specific valuation allowances as of the dates indicated. All substandard and special mention loans receivable and related specific valuation allowances were on 1-4 family residential mortgage loans.

  POTENTIAL PROBLEM LOANS(Dollars in thousands)

			At December 31,
			2000		1999		1998		1997		1996
			------		------		------		------		------
Substandard		$	1,785	$	1,633	$	1,970	$	1,564	$	1781
Special Mention			127		148		241		298		346
			------		------		------		------		------
Gross			1,912		1,781		2,211		1,862		2,127
Less Allowance for
	Loan Loss *		-		(106)		(141)		(141)		(160)
			------		------		------		------		------
Net		$	1,912	$	1,675	$	2,070	$	1,721	$	1,967
			=====		=====		=====		=====		=====

* Up until the safety and soundness examination completed by the OTS in November, 1999, the Company maintained a specific and general valuation allowance for loan loss. At the suggestion of OTS regulators, the Company adopted a methodology of one single allowance for loan loss, eliminating the prior separate accounting of the specific and general valuation allowances for loan loss.

Allowance for Loan Loss. The allowance for loan loss ("ALL") is calculated by assessing the need for specific reserves on identified problem credits (see special assets in the previous paragraph) in addition to using historical and economic based percentages on certain classifications of homogeneous loans to arrive at an overall ALL. Several of these categories are based on the particular loan being included on the Company’s Watch List. Other categories are based on the type of underlying collateral such as commercial or residential real estate while still other categories are based on the nature of the loan such as construction verses permanent financing. At December 31, 2000, the ALL was allocated as follows:

GS Financial Corp.

Allocation of the Allowance for Loan Losses

As of December 31, 2000

Balance at End of Period Applicable to:	2000		1999		1998		1997		1996
	Amount	Percent of Total Loans	Amount	Percent of Total Loans	Amount	Percent of Total Loans	Amount	Percent of Total Loans	Amount	Percent of Total Loans
One to Four Family Residential	390	94.9%	340	95.7%	377	95.7%	373	97.3%	335	95.9%
FHA and VA	-	.1%	-	.2%	-	.4%	-	.7%	-	1.1%
Construction	-	.8%	-	.9%	-	1.1%	-	.2%	-	.7%
Commercial Real Estate	24	1.3%	39	2.0%	15	1.8%	22	.9%	27	1.0%
Other Real Estate	-	1.9%	45	.6%	45	.3%	15	.2%	20	.3%
Second Mortgage	-	.1%	-	.1%	26	.2%	-	.3%	-	.6%
Loans on Deposits	-	.3%	-	.5%	-	.5%	-	.5%	-	.4%
Commercial Loans	6	.5%	-	n/a	-	n/a	-	n/a	-	n/a
TOTAL	420	100.0%	424	100.0%	463	100.0%	410	100.0%	382	100.0%

LOAN LOSS EXPERIENCE

Provisions for loan losses are charged to earnings to bring the total ALL to a level considered appropriate by management. Losses are incurred via foreclosure, deterioration the of the underlying collateral, inability of the customer to repay the loan or other means. These losses are charged against the ALL. As mentioned earlier, the ALL is evaluated on a quarterly basis and provisions to increase or reductions to reduce the allowance to the appropriate level deemed by management are recorded when necessary. Charge-offs reduce the allowance while recoveries increase the allowance during the quarter. Management assesses the ALL accordingly and establishes additional provisions to bring the ALL to an appropriate level. The appropriate level of the ALL is determined by management’s estimation of the amount of loss associated with loans considered to be impaired in accordance with SFAS 114, "Accounting by Creditors for Impairment of a Loan," as well as management’s estimate of loss associated with the remaining portfolio. Historical analysis of factors such as number of foreclosures, level of delinquencies and amount of charge-offs as well as other factors such as local and national economic conditions help management set both the formula used to calculate the ALL for the remaining loan portfolio as well as an appropriate level for the ALL overall.

The following table sets forth the Company’s loan loss experience for the years presented. All of the charge-offs and provisions in the following table were on first mortgages of one-to-four family dwellings.

An analysis of the allowance for loan losses is as follow (dollars in thousands):

			Years Ended December 31,
			2000		1999		1998		1997		1996
			-----		-----		-----		-----		-----
Balance, Beginning
	of Year	$	424	$	463	$	410	$	382	$	323
Provision for Losses			7		6		53		28		59
Loans Charged Off			(11)		(45)		-		-		-
Recoveries			-		-		-		-		-
			-----		-----		-----		-----		-----
Balance, End of Year		$	420	$	424	$	463	$	410	$	382
			====		====		====		====		====
Allowance for Loan
	Losses as a % of
	Total Loans Receivable	.56%		.60%		.72%		.77%		.87%
Allowance for Loan
	Losses as a % of
	Non Performing Loans	96.69%		422.97%		174.01%		247.49%		151.17%

Mortgage-Backed Securities

The Company has invested in a portfolio of mostly fixed-rate, mortgage-backed securities that are issued or guaranteed by the Federal Home Loan Mortgage Corporation (FHLMC), the Federal National Mortgage Association (FNMA) or the Government National Mortgage Association (GNMA). The FHLMC and FNMA are enterprises sponsored by the Federal government while GNMA securities represent direct obligations of the Federal government. Because of this, these securities are considered high quality investments with minimal credit risks. The guaranteed aspect of these investments results in yields slightly less than the actual yields on the underlying mortgage loans.

Mortgage-backed securities represent participating interests in pools of first mortgage loans originated and serviced by their prospective issuers. Principal and interest payments of the underlying mortgage loans are passed through intermediaries, including but not limited to the issuing agencies, on to investors such as GS Financial Corp. These securities in general offer slightly higher yields than United States Treasury obligations.

The Company invests in mortgage-backed securities with terms varying from 5 to 30 years. These securities are subject to variations in cash flow and yield due to the prepayment rates of the underlying mortgage loans. All such mortgage-backed securities meet the requirements of qualified thrifts investments as later defined.

On September 30, 1997 the Company reclassified all of its mortgage-backed securities as available-for-sale pursuant to SFAS 115. Management felt that this classification was more appropriate considering the magnitude of the Company’s investment in these instruments and the liquidity available should other investment opportunities arrive.

The following table sets forth the composition of the Company’s mortgage-backed securities portfolio at each of the dates indicated (in thousands):

MORTGAGE-BACKED SECURITIES

December 31, 2000		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		----------		----------		----------		----------
Available for Sale:
FNMA	$	1,481	$	-	$	5	$	1,476
FHLMC		1,096		-		2		1,094
GNMA		1,541		4		-		1,545
		-------		-------		-------		-------
	$	4,118	$	4	$	7	$	4,115
		=====		=====		=====		=====
December 31, 1999		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		----------		----------		----------		----------
Available for Sale:
FNMA	$	5,255	$	1	$	81	$	5,175
FHLMC		1,328		3		34		1,297
GNMA		10,160		-		357		9,803
		-------		-------		-------		-------
	$	16,743	$	4	$	472	$	16,275
		=====		=====		=====		=====

The following table sets forth the maturities of the mortgage-backed security portfolio as of December 31, 2000 (in thousands):

MORTGAGE-BACKED SECURITIES

	December 31, 2000		Amortized Cost		Fair Value	Weighted Average Rate
			---------		---------
Mortgage-Backed Securities Maturing:
	In One Year or Less	$	230	$	230	5.69%
	After One Year Through Five Years		814		819	6.77%
	After Five Years Through Ten Years		1,187		1,177	5.83%
	After Ten Years		1,887		1,889	8.02%
			------		------
		$	4,118	$	4,115
			=====		=====

The following table sets forth the purchases, sales and principal repayments of the Company’s mortgage-backed securities during the periods indicated (in thousands):

MORTGAGE-BACKED SECURITIES

				2000		1999		1998
				-------		-------		-------
Mortgage Backed Securities
	Balance at January 1,		$	16,743	$	23,058	$	41,648
	Purchases			-		-		5,764
	Repayments			(1,956)		(6,227)		(11,790)
	Sales (Net of Gains)			(10,650)		-		(12,388)
	Amortizations of Premiums
		/Discounts (Net)		(19)		(88)		(176)
				-------		-------		-------
	Balance at December 31,		$	4,118	$	16,743	$	23,058
				======		======		======
	Weighted Average Yield			6.68%		6.53%		6.34%

Investment Securities

The Company invests in United States Treasury and Agency issued obligations ranging in term from 3 months to 10 years. The investment policy of the Company is reviewed periodically by Management and ratified annually by the Board of Directors. At present the investment policy of the Company strives to maintain a liquid, conservative portfolio of investments keeping in mind the cash flow and investment needs of the Company.

The Company also invests its excess cash in two institutional funds whose principal underlying holdings are qualified thrift investments. One is an adjustable rate mortgage (ARM) fund while the other is an intermediate mortgage fund (IMF). Both of these funds are offered by the First Financial Trust, which is a co- operative institutional investment group comprised of members of America’s Community Bankers. These two funds provide a supplement to the Company’s other short-term money market investments and Federal Funds Sold, typically yielding a higher rate of return while still providing excellent liquidity.

Interest rates dictate many of the investment decisions and policies of the Company. It is the policy of the Company not to engage in speculative purchasing, selling or trading of investments, however, certain profits may be taken from time to time on the sale of investments. When interest rate spreads reach acceptable levels the Company may utilize leveraged purchasing of investment securities. Also, when anticipated earnings permit, certain portfolio adjustments may be made to enhance the overall portfolio yield even though losses may be recognized in doing so.

The Company’s investment portfolio is classified as available-for-sale in accordance with SFAS 115. Prior to 1997, the Company’s investment portfolio was largely classified as held-to-maturity with only approximately 5% to 10% being classified available for sale. That amount was determined by Management as necessary should any emergency liquidity demands arise. On September 30, 1996, the Company sold investments classified held-to-maturity, thus "tainting" the portfolio and forcing 100% of the portfolio to be classified as available-for-sale. Management felt this was in the best interest of the Company in considering the then current interest rate environment, high loan demand, capital strength of the Company and future investment avenues which might be pursued in light of the impending stock conversion.

INVESTMENT SECURITIES

Securities available-for-sale consist of the following (in thousands):

	December 31, 2000		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
			----------		----------		----------		----------
U. S. Government
	and Federal Agencies	$	2,389	$	72	$	-	$	2,461
Adjustable Rate
	Mortgage Mutual Fund		2,831		-		8		2,823
Intermediate
	Mortgage Mutual Fund		400		-		30		370
FHLMC Common Stock			25		1,767		-		1,792
FHLMC Preferred Stock			3,506				2		3,504
Equity Investments - Other			50		-		-		50
			-------		-------		-------		-------
		$	9,201	$	1,839	$	40	$	11,000
			=====		=====		=====		=====
	December 31, 1999		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
			----------		----------		----------		----------
U. S. Government
	and Federal Agencies	$	4,678	$	35	$	30	$	4,683
Adjustable Rate
	Mortgage Mutual Fund		1,390		-		9		1,381
Intermediate
	Mortgage Mutual Fund		2,972		-		247		2,725
FHLMC Common Stock			35		1,659		-		1,694
			-------		-------		-------		-------
		$	9,075	$	1,694	$	286	$	10,483
			=====		=====		=====		=====

The following table sets forth the amount of investment securities which mature during each of the periods indicated at December 31, 2000:

INVESTMENT SECURITIES

		Securities
		Available-for-Sale
	December 31, 2000		Amortized Cost		Fair Value	Weighted Average Rate
			---------		---------
Amounts Maturing in:
	In One Year or Less	$	7,911	$	9,643	6.79%
	After One Year Through Five Years		300		326	7.50%
	After Five Years Through Ten Years		990		1,031	7.05%
			------		------
		$	9,201	$	11,000
			=====		=====

COLLATERALIZED MORTGAGE OBLIGATIONS

Currently, the Company’s investment in Collateralized Mortgage Obligations (CMO’s) is limited to first-tranche Real Estate Mortgage Investment Conduits (REMIC’s). A REMIC is a pass through investment created under the Tax Reform Act of 1986 to issue multiple class mortgage-backed securities. The mulitiple classes within a REMIC are known as "tranches." The tranches are paid principal and/or interest based on the payment schedule outlined in the prospectus.

The Company’s investment in REMIC’s is limited to those issued by FNMA, FHLMC and "AAA" rated non-governmental issuers. These are defined to be within the 20% risk-weighted category for thrift institutions. The contractual maturity of a REMIC is defined by the latest maturity date of the underlying group of mortgage loans. In terms of actual cash flow, the term or duration of the REMIC’s purchased by the Company varies from 2 to 4 years. The cash flow of these investments facilitates the operating needs of the Company.

The following table sets forth the composition of the Company’s portfolio of Collateralized Mortgage Obligations indicated (in thousands):

COLLATERALIZED MORTGAGE OBLIGATIONS

December 31, 2000		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		----------		----------		----------		----------
Available-for-Sale:
FNMA	$	5,766	$	-	$	187	$	5,579
FHLMC		14,254		196		309		14,141
Other		33,562		583		120		34,025
		-------		-------		-------		-------
	$	53,582	$	779	$	616	$	53,745
		=====		=====		=====		=====

December 31, 1999		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		----------		----------		----------		----------
Available-for-Sale:
FNMA	$	8,058	$	-	$	474	$	7,584
FHLMC		17,347		167		690		16,824
Other		28,493		15		836		27,672
		-------		-------		-------		-------
	$	53,898	$	182	$	2,000	$	52,080
		=====		=====		=====		=====

Sources of Funds

General. Deposits have always been the primary source of the Company’s funds for lending and other investment purposes. The supply of retail deposits has decreased due to more investors putting their money in the markets. As a result the Company has turned towards wholesale sources such as the FHLB which allows member institutions such as the Company to borrow money at discounted costs.

Deposits. The Company’s deposits are attracted principally from within its market area. Many depositors are also mortgage loan customers. The Company offers passbook savings, demand deposit accounts, now accounts and certificates of deposit. Terms for certificates vary from 3 months to 5 years while rates tend to increase with term.

The following table shows the distribution of, and certain other information relating to the Company’s deposits. Deposit account balances at December 31, 2000, 1999, and 1998 are summarized as follows (in thousands):

		Years Ending December 31,
			2000			1999			1998
				Wtd.			Wtd.			Wtd.
				Avg.			Avg.			Avg.
			Balance	Rate		Balance	Rate		Balance	Rate
			----------	----------		----------	----------		----------	----------
Demand Deposit
	Accounts	$	3,185	4.64%	$	44	N/A	$	-	N/A
Passbook Savings
	Accounts		17,431	3.00%		20,170	3.00%		21,512	3.00%
Certificates of
	Deposit		38,263	5.85%		39,002	5.00%		39,593	5.20%
			--------			--------			--------
		$	58,879		$	59,216		$	61,105
			=====			=====			=====

The following table sets forth the deposit cash flow of the Company during the periods indicated (in thousands):

		Year Ended December 31,
			2000		1999		1998
			------		------		------
Increase (decrease) before
	Interest Credited	$	(2,396)	$	(3,830)	$	2,392
Interest Credited			2,059		1,941		1,891
			------		------		------
Net increase (decrease) in deposits		$	(337)	$	(1889)	$	4,283

The Company attempts to price its deposit accounts to remain generally competitive with other financial institutions in its market area, while maintaining its traditional margins. Traditionally the Company has relied on its passbook savings accounts as a core deposit base. In line with such policies, the Company does not pay "jumbo" rates for deposits $100,000 and over.

The principal methods used by the Company to attract deposits include its emphasis on personal service, competitive interest rates and convenient office locations. The Company does not advertise for deposits outside of its primary market area. At December 31, 2000, the Company had no deposits that were obtained through deposit brokers.

The following table presents the amount of certificates of deposit at December 31, 2000 which mature during the periods indicated (in thousands).

			Amount	Percent
			-------	-------
Certificate Accounts Maturing
	Under 12 months	$	29,478	77.04%
	12 months to 24 months		6,387	16.69%
	24 months to 36 months		1,710	4.47%
	36 months to 48 months		251	.66%
	48 months to 60 months		437	1.14%
			------	-----
Total Certificates		$	38,263	100.00%
			=====	======

The following table sets forth the maturities of the Company’s deposits of $100,000 or more at December 31, 2000 by time remaining to maturity (in thousands).

DEPOSITS 100,000 AND OVER

(in thousands)

Maturing in 3 months or less	$	1,986
Maturing in 3 to 6 months		614
Maturing in 6 months to 1 year		1,118
Maturing in 1 to 2 years		210
		------
Total Deposits $100,000 and over	$	3,928
		=====

Borrowings. During 2000 the Company obtained advances from the FHLB, usually as part of a leveraged investment program. The Company borrows the funds which are subsequently reinvested in mortgage-backed securities, collateralized mortgage obligations and other investments which earn interest at a rate greater than the rate charged on the advances. The advances consist of fully amortizing and balloon advances which mature between January, 2001 and June, 2008. A summary of the advances by maturity and interest rate are detailed as follows (in thousands):

			Weighted
Maturing in the Year			Average
Ending December 31,		Amount	Rate
-------------------		----------	----------
2001	$	19,318	6.55%
2002		7,828	6.21%
2003		8,329	5.53%
2004		-	-
2005		6,709	6.57%
Thereafter		12,007	5.50%
		---------
	$	54,191

The maximum amount of advances outstanding at any month-end during 2000 was $60.3 million. The average balance outstanding during 2000 was $53.9 million. Prior to 1997 the Company had no material borrowings.

Treasury Stock

Since 1998, the Company has been repurchasing shares of its common stock. The Company became eligible one year from the date of its initial public offering to begin repurchasing stock. For the first two years of the buyback program, the Company was limited to 10% per year per OTS regulations. On April 1, 2000, the three year anniversary of the Company’s IPO, the 10% per year limitation on buybacks was lifted. The following table summarizes the repurchase of shares of its common stock by year:

GS Financial Corp.

Common Stock Repurchases

Year	Shares Repurchased	Average Price
1998	491,054	$ 16.95
1999	299,000	$ 12.22
2000	679,600	$ 12.64
	------------	--------
Total	1,469,654	$ 13.99

All purchases were open market transactions. Due to the highly capitalized condition of the Company, management felt that these purchases, most of which were at a discount to book value, were an effective way to reduce capital while still enhancing shareholder value. The alternative to reducing capital would have been rapid growth probably through some type of acquisition. Given the premium nature of current financial institution buyouts, the alternative approach to reducing capital through buybacks seemed a more conservative approach. These shares have not been retired and could potentially serve as a source of funding should the need arise in the future.

Subsidiaries

Guaranty Savings & Homestead Association is a wholly-owned subsidiary of the Company. The Company has no other subsidiaries.

Competition

Guaranty Savings & Homestead Association faces significant competition both in attracting deposits and in originating loans. Its most direct competition for deposits has come from commercial banks, credit unions, other savings and loans and mortgage brokers located in the metropolitan New Orleans market. The Association also competes for investors’ funds with short-term money market mutual funds and issuers of corporate and government securities. Guaranty Savings & Homestead Association does not rely on any individual group or entity for a material portion of its deposits or mortgage loan portfolio. The Association’s primary factors in competing in the home mortgage loan market are its efficient personal service and attractive interest rates and terms.

Employees

The Association had 31 full-time employees at December 31, 2000. None of these employees are represented by a collective bargaining agreement. Guaranty Savings & Homestead Association believes that it enjoys excellent relations with its personnel.

Regulation

Set forth below is a brief description of certain laws and regulations which are applicable to the Company and Guaranty Savings & Homestead Association. The description of these laws and regulations, as well as descriptions of laws and regulations contained elsewhere herein, does not purport to be complete and is qualified in its entirety by reference to applicable laws and regulations.

The Company

General. The Company, as a savings and loan holding company within the meaning of the Home Owners’ Loan Act, as amended ("HOLA"), is registered with and subject to OTS regulations, examinations, supervision and reporting. As a subsidiary of a savings and loan holding company, Guaranty Savings & Homestead Association is subject to certain restrictions in its dealings with the Company and any affiliates thereof.

Activities Restrictions. There are generally no restrictions on the activities of a savings and loan holding company which holds only one subsidiary savings institution. However, if the Director of the OTS determines that there is reasonable cause to believe that the continuation by a savings and loan holding company of an activity constitutes a serious risk to the financial safety, soundness or stability of its subsidiary savings institution, the Director may impose such restrictions as deemed necessary to address such risk, including limiting (i) payment of dividends by the savings institution; (ii) transactions between the savings institution and its affiliates; and (iii) any activities of the savings institution that might create a serious risk that the liabilities of the holding company and its affiliates may be imposed on the savings institution. Notwithstanding the above rules as to permissible business activities of unitary savings and loan holding companies, if the savings institution subsidiary of such a holding company fails to meet the qualified thrift lender ("QTL") test, as discussed under "- The Association – Qualified Thrift Lender Test," then such unitary holding company also shall become subject to the activities restrictions applicable to multiple savings and loan holding companies and, unless the savings institution re-qualifies as a QTL within one year thereafter, shall register as, and become subject to the restrictions applicable to, a bank holding company. See "- The Association – Qualified Thrift Lender Test."

If the Company were to acquire control of another savings institution, other than through merger or other business combination with Guaranty Savings, the Company would thereupon become a multiple savings and loan holding company. Except where such acquisition is pursuant to the authority to approve emergency thrift acquisitions and where each subsidiary savings institution meets the QTL test, as set forth below, the activities of the Company and any of its subsidiaries (other than Guaranty Savings or other subsidiary savings institutions) would thereafter be subject to further restrictions. Among other things, no multiple savings and loan holding company or subsidiary thereof which is not a savings institution shall commence or continue for a limited period of time after becoming a multiple savings and loan holding company or subsidiary thereof any business activity, other than: (i) furnishing or performing management services for a subsidiary savings institution; (ii) conducting an insurance agency or escrow business; (iii) holding, managing, or liquidating assets owned by or acquired from a subsidiary savings institution; (iv) holding or managing properties used or occupied by a subsidiary savings institution; (v) acting as trustee under deeds of trust; (vi) those activities authorized by regulation as of March 5, 1987 to be engaged in by multiple savings and loan holding companies; or (vii) unless the Director of the OTS by regulation prohibits or limits such activities for savings and loan holding companies. Those activities described in clause (vii) above also must be approved by the Director of the OTS prior to being engaged in by a multiple savings and loan holding company.

Limitations on Transactions with Affiliates. Transactions between savings institutions and any affiliate are governed by Sections 23A and 23B of the Federal Reserve Act. An affiliate of a savings institution is any company or entity which controls, is controlled by or is under common control with the savings institution. In a holding company context, the parent holding company of a savings institution (such as the Company) and any companies which are controlled by such parent holding company are affiliates of the savings institution. Generally, Sections 23A and 23B (i) limit the extent to which the savings institution or its subsidiaries may engage in "covered transactions" with any one affiliate to an amount equal to 10% of such institution’s capital stock and surplus, and contain an aggregate limit on all such transactions with all affiliates to an amount equal to 20% of such capital stock and surplus and (ii) require that all such transactions be on terms substantially the same, or at least as favorable, to the institution or subsidiary as those provided to a non-affiliate. The term "covered transaction" includes the making of loans, purchase of assets, issuance of guarantee and other similar transactions. In addition to the restrictions imposed by Sections 23A and 23B, no savings institution may (i) loan or otherwise extend credit to an affiliate, except for any affiliate which engages only in activities which are permissible for bank holding companies, or (ii) purchase or invest in any stocks, bonds, debentures, notes or similar obligations of any affiliate, except for affiliates which are subsidiaries of the savings institution.

In addition, Sections 22(h) and (g) of the Federal Reserve Act place restrictions on loans to executive officers, directors and principal stockholders. Under Section 22(h), secured loans to a director, an executive officer and to a greater than 10% stockholder of a savings institution, and certain affiliated interest of either, may not exceed, together with all other outstanding loans to such person and affiliated interests, the savings institution’s loans to one borrower limit (generally equal to 25% of the institution’s unimpaired capital and surplus). Section 22(h) also requires that loans to directors, executive officers and principal stockholders be made on terms substantially the same as offered in comparable transactions to other persons unless the loans are made pursuant to a benefit or compensation program that (i) is widely available to employees of the institution and (ii) does not give preference to any director, executive officer or principal stockholder, or certain affiliated interests of either, over other employees of the savings institution. Section 22(h) also requires prior Board approval for certain loans. In addition, the aggregate amount of extensions of credit by a savings institution to all insiders cannot exceed the institution’s unimpaired capital and surplus. Furthermore, Section 22(g) places additional restrictions on loans to executive officers. At December 31, 2000 Guaranty Savings was in compliance with the above restrictions.

Restrictions on Acquisitions. Except under limited circumstances, savings and loan holding companies are prohibited from acquiring, without prior approval of the Director of the OTS, (i) control of any other savings institution or savings and loan holding company or substantially all the assets thereof or (ii) more than 5% of the voting shares of a savings institution or holding company thereof which is not a subsidiary. Except with the prior approval of the Director of the OTS, no director or officer of a savings and loan holding company or person owning or controlling by proxy or otherwise more than 25% of such company’s stock, may acquire control of any savings institution, other than a subsidiary savings institution, or of any other savings and loan holding company.

The Director of the OTS may only approve acquisitions resulting in the formation of a multiple savings and loan holding company which controls savings institutions in more than one state if (i) the multiple savings and loan holding company involved controls a savings institution which operated a home or branch office located in the state of the institution to be acquired as of March 5, 1987; (ii) the acquirer is authorized to acquire control of the savings institution pursuant to the emergency acquisition provisions of the Federal Deposit Insurance Act ("FDIA"); or (iii) the statutes of the state in which the institution to be acquired is located specifically permit institutions to be acquired by the state-chartered institutions or savings and loan holding companies located in the state where the acquiring entity is located (or by a holding company that controls such state-chartered savings institutions).

Under the Bank Holding Company Act of 1956, the Federal Reserve Bank ("FRB") is authorized to approve an application by a bank holding company to acquire control of a savings institution. In addition, a bank holding company that controls a savings institution may merge or consolidate the assets and liabilities of the savings institution with, or transfer assets and liabilities to, any subsidiary bank which is a member of the Bank Insurance fund with the approval of the appropriate federal banking agency and the FRB. As a result of these provisions, there have been a number of acquisitions of savings institutions by bank holding companies in recent years.

Federal Securities Laws. The Company’s common stock is registered with the SEC under the Securities and Exchange Act of 1934 ("Exchange Act"). The Company is subject to the information, proxy solicitation, insider trading restrictions and other requirements under the Exchange Act.

Financial Modernization. Under the Gramm-Leach-Bliley Act enacted into law on November 12, 1999, no company may acquire control of a savings and loan holding company after May 4, 1999, unless the company is engaged only in activities traditionally permitted to a multiple savings and loan holding company or newly permitted to a financial holding company under Section 4 (k) of the Bank Holding Company Act. Existing savings and loan holding companies and those formed pursuant to an application filed with the OTS before May 4, 1999, may engage in any activity including non-financial or commercial activities provided such companies control only one savings and loan association that meets the Qualified Thrift Lender test. Corporate reorganizations are permitted, but the transfer of grand-fathered unitary thrift holding company status through acquisition is not permitted.

The Association

General. As a Louisiana chartered stock savings and loan association, the OFI is the Association’s chartering authority, and the OTS serves as the Association’s primary regulator. As such, the OFI and the OTS have extensive authority over the operations of Louisiana-chartered savings institutions. The Association is subject to periodic examinations and is required to file monthly, quarterly and annual reports with either or both parties. The investment and lending authority of savings institutions are prohibited from engaging in any activities not permitted by such laws and regulations. Such regulation and supervision is primarily intended for the protection of depositors.

Insurance of Accounts. The deposits of Guaranty Savings and Homestead Association are insured to the maximum permitted by the SAIF, which is administered by the FDIC, and are backed by the full faith and credit of the U.S. Government. As insurer, the FDIC is authorized to conduct examinations of, and to require reporting by, FDIC-insured institutions. It also may prohibit any FDIC-insured institution from engaging in any activity the FDIC determines by regulation or order to pose a serious threat to the FDIC. The FDIC also has the authority to initiate enforcement actions against savings institutions, after giving the OTS an opportunity to take such action.

The FDIC may terminate the deposit insurance of any insured depository institution, including Guaranty Savings and Homestead Association, if it determines after a hearing that the institution has engaged or is engaging in unsafe or unsound practices, is in an unsafe or unsound condition to continue operations, or has violated any applicable law, regulation, order or any condition imposed by an agreement with the FDIC. It also may suspend deposit insurance temporarily during the hearing process for the permanent termination of insurance, if the institution has no tangible capital. If insurance of accounts is terminated, the accounts at the institution at the time of the termination, less subsequent withdrawals, shall continue to be insured for a period of six months to two years, as determined by the FDIC. Management is aware of no existing circumstances which would result in termination of the Association’s deposit insurance.

Regulatory Capital Requirements. Federally insured savings institutions are required to maintain minimum levels of regulatory capital. Pursuant to the Financial Institutions Reform, Recovery and Enforcement Act of 1989 ("FIRREA"), the OTS has established capital standards applicable to all savings institutions. These standards generally must be as stringent as the comparable capital requirements imposed on national banks. The OTS also is authorized to impose capital requirements in excess of these standards on individual institutions on a case-by-case basis.

Current OTS capital standards require savings institutions to satisfy three different capital requirements. Under these standards, savings institutions must maintain tangible capital (1.5%), core capital (3.0%), and risk based capital (8.0%). Core capital includes generally recognized capital such as common stockholders’ equity and retained earnings plus other items such as qualifying goodwill. Tangible capital is essentially the same but does not include qualifying supervisory goodwill. At December 31, 2000 the Association had no goodwill or other intangible assets which are deducted in computing its tangible capital.

In determining risk-based capital, a savings institution is allowed to include both core capital and supplementary capital. Assets are assigned to particular risk-weighted categories and subsequently multiplied by that particular percentage (cash and US Treasury and Agency securities equal 0%, 20% for high quality mortgage-backed securities including those issued by US Government Agencies and "AAA" rated private companies, state and local obligations, claims on FHLB’s and claims on domestic depository institutions, 50% for single family mortgage loans and 100% for all other loans and investments). The sum of these calculations becomes the total of risk-weighted assets which are then used to calculate the Association’s risk-based capital ratio.

At December 31, 2000, Guaranty Savings exceeded all of its regulatory capital requirements, with tangible, core and risk- based capital ratios of 16.20%, 16.20% and 39.50% respectively.

Liquidity Requirements. All savings institutions are required to maintain an average daily balance of liquid assets equal to a certain percentage of the sum of its average daily balance of net withdrawable deposit accounts and borrowings payable in one year or less. As of December 31, 2000 Guaranty Savings and Homestead Association’s liquidity was 57.10%, or $58.3 million in excess of the minimum required 4%.

Capital Distributions. OTS regulations govern capital distributions by savings institutions, which include cash dividends, stock redemptions or repurchases, cash-out mergers, interest payments on certain convertible debt and other transactions charged to the capital account of a savings institution to make capital distributions. Under these regulations, a safe harbor is created for specified levels of capital distributions as long as the savings institution meets their minimum capital requirements, and as long as such institutions notify the OTS and receive no objection to the distribution from the OTS. Savings institutions and distributions that do not qualify for the safe harbor are required to obtain prior OTS approval before making any capital distributions.

Under recently adopted amendments to the OTS’ regulations which become effective April 1, 1999, a savings institution that before and after the proposed distribution would at least be adequately capitalized may make capital distributions during any calendar year equal to net income for the applicable calendar year plus net income for the prior two years less any capital distribution in those prior periods. Failure to meet minimum capital requirements will result in further restriction on capital distributions, including possible prohibition without explicit OTS approval.

In order to make distributions under this safe harbor, institutions which are subsidiaries of savings and loan holding companies must submit 30 day written notice to the OTS prior to making the distribution. The OTS may object to the distribution during the 30-day period based on safety and soundness concerns.

Community Reinvestment. Under the Community Reinvestment Act of 1977, as amended ("CRA"), as implemented by OTS regulations, a savings institution has a continuing and affirmative obligation consistent with its safe and sound operation to help meet the credit needs of its entire community, including low and moderate income neighborhoods. The CRA does not establish specific lending requirements or programs for financial institutions nor does it limit an institution’s discretion to develop the types of products and services that it believes are best suited to its particular community, consistent with the CRA. The CRA requires the OTS, in connection with its examination of a savings institution, to assess the institution’s record of meeting the credit needs of its community and to take such record into account in its evaluation of certain applications by such institution. The CRA requires public disclosure of an institution’s CRA rating and requires the OTS to provide a written evaluation of an institution’s CRA performance utilizing a rating system which identifies four levels of performance that may describe an institution’s record of meeting community needs: outstanding, satisfactory, needs to improve and substantial noncompliance. The CRA also requires all institutions to make public disclosure of their CRA ratings. The Association’s current CRA rating is satisfactory.

Qualified Thrift Lender Test. The Qualified Thrift Lender (QTL) Test measures the Association’s level of qualified thrift investments compared to its total portfolio assets (total assets less intangibles, property used by a savings association in its business and liquidity investments in an amount not to exceed 20% of assets). Generally, qualified thrift investments ("QTI’s")are residential housing related assets. The Internal Revenue Service (IRS) requires a savings institution to have at least 65% of its assets in "QTI’s" to qualify for tax treatment as a building and loan association. At December 31, 2000, 94.20% of the Association’s assets were invested in QTI’s which was in excess of the percentage required to qualify the Association under the QTL test.

Federal Home Loan Bank System. Guaranty Savings and Homestead Association is a member of the FHLB of Dallas. Each FHLB serves as a reserve or central bank for its members within its assigned region. It is funded primarily from proceeds derived from the sale of FHLB agency issued obligations. As a member, the Association is required to maintain stock in the FHLB of Dallas in an amount equal to at least 1% of its aggregate unpaid residential mortgage loans, home purchase contracts or similar obligations at the beginning of each year or 5% of its advances from the FHLB of Dallas, whichever is greater. At December 31, 2000, Guaranty Savings and Homestead Association had $3.1 million in FHLB stock, which was in compliance with this requirement.

Federal Taxation

General. The Company and the Association are subject to the generally applicable corporate tax provisions of the Internal Revenue Code (the "Code"), and the Association is subject to certain additional provisions of the Code which apply to thrifts and other types of financial institutions. The following discussion of federal taxation is intended only to summarize certain pertinent federal income tax matters relevant to the taxation of the Company and the Association and is not a comprehensive discussion of the tax rules applicable to the Company and the Association.

Year. The Company files a consolidated federal tax return on the basis of a calendar year ending on December 31.

Bad Debt Reserves. A small financial institution (one with an adjusted basis of assets of less than $500 million), such as the Association, is required in tax years beginning after 1995 to determine additions to its bad debt reserves under the experience method. Under the experience method, the deductible annual addition to the institution’s bad debt reserves is the amount necessary to increase the balance of the reserve at the close of the taxable year to the greater of (a) the amount which bears the same ratio to loans outstanding at the close of the taxable year as the total net bad debts sustained during the current and five preceding taxable years bear to the sum of loans outstanding at the close of the same six years, or (b) the lower of (i) the balance of the reserve account at the close of the Association’s "base year," which was its tax year ended December 31, 1987, or (ii) if the amount of loans outstanding at close of the taxable year is less than the amount of loans outstanding at the close of the base year, the amount which bears the same ratio to loans outstanding at the close of the taxable year as the balance of the reserve at the close of the base year bears to the amount of loans outstanding at the close of the base year.

In 1996, the Association was required to change its method of computing its bad debt deduction from other methods previously allowable to the experience method. As a result of the change in law, the Association is required to include an amount into taxable income over a six-year period beginning in 1998. The amount required to be included in taxable income is the difference between its bad debt reserves at December 31, 1995, as determined under previously allowable bad debt methods, and the reserve allowable under the experience method at December 31, 1995. The amount to be included in the Association’s taxable income over the six-year period beginning with 1998 is $145,346, or $24,224 per year.

At December 31, 2000, the federal income tax reserves of the Association included $5.5 million for which no federal income tax has been provided. Because of these federal income tax reserves and the liquidation account to be established for the benefit of certain depositors of the Association in connection with the conversion of the Association to stock form, the retained earnings of the Association are substantially restricted.

Distributions. If the Association were to distribute cash or property to its sole stockholder, and the distribution was treated as being from its accumulated bad debt reserves, the distribution would cause the Association to have additional taxable income. A distribution is deemed to have been made from accumulated bad debt reserves to the extent that (a) the reserves exceed the amount that would have been accumulated on the basis of actual loss experience, and (b) the distribution is a "non-qualified distribution." A distribution with respect to stock is a non- qualified distribution to the extent that, for federal income tax purposes, (i) it is in redemption of shares, (ii) it is pursuant to a liquidation of the institution, or (iii) in the case of a current distribution, together will all other such distributions during the taxable year, it exceeds the institutions current and post-1951 accumulated earnings and profits. The amount of additional taxable income created by a non-qualified distribution is an amount that when reduced by the tax attributable to it is equal to the amount of the distribution.

Minimum Tax. The Internal Revenue Code imposes an alternative minimum tax at a rate of 20% on corporations with average annual gross receipts in excess of $7.5 million for the prior three tax years. Average annual gross receipts of the Company is in excess of $7.5 million and as a result, the Company is subject to the provisions of the alternative minimum tax provisions of the Code. The alternative minimum tax generally applies to a base of regular taxable income plus certain tax preferences ("alternative minimum taxable income" or "AMTI") and is payable to the extent such AMTI is in excess of an exemption amount. The Code provides items of tax preference including (a) tax exempt interest on newly issued (generally, issued after August 8, 1986) private activity bonds other than certain qualified bonds, (b) certain accelerated depreciation amounts and (c) 75% of the excess if any of (i) adjusted current earnings as defined in the Code, over (ii) AMTI (defined without regard to this preference and prior to reduction by net operating losses).

Net Operating Loss Carryovers. A financial institution may carry back net operating losses ("NOLs") to the preceding two taxable years and forward to the succeeding 20 taxable years. This provision applies to losses incurred in taxable years beginning after 1986. At December 31, 2000, the Association had no NOL carry-forwards for federal income tax purposes.

Capital Gains and Corporate Dividends-Received Deduction. Corporate net capital gains are taxed at a maximum rate of 35%. The corporate dividends-received deduction is 80% in the case of dividends received from 20% or more owned corporations with which a corporate recipient does not file a consolidated tax return. Corporations which own less than 20% of the stock of a corporation distributing a dividend may deduct only 70% of dividends received or accrued on their behalf. However, a corporation may deduct 100% of dividends from a member of the same affiliated group of corporations.

Other Matters. Federal legislation is introduced from time to time that would limit the ability of individuals to deduct interest paid on mortgage loans. Individuals are currently not permitted to deduct interest on consumer loans. Significant increases in tax rates or further restrictions on the deductibility of mortgage interest could adversely affect the Association.

The Company’s federal income tax returns for the tax years ended December 31, 1997 forward are open under the statute of limitations and are subject to review by the IRS. The Company is currently being examined by the IRS for the tax year ended December 31, 1998.

State Taxation

Any non-banking subsidiaries of the Association ( as well as the Company) are subject to the Louisiana Corporation Income Tax based on their Louisiana taxable income, as well as franchise taxes. The Corporation Income Tax applies at graduated rates from 4% upon the first $25,000 of Louisiana taxable income to 8% on all Louisiana taxable income in excess of $200,000. For these purposes, "Louisiana taxable income" means net income which is earned within or derived from sources within the State of Louisiana, after adjustments permitted under Louisiana law including a federal income tax deduction and an allowance for net operating losses, if any. As a stock thrift, the Association is subject to the Louisiana Shares Tax. The formula for deriving the assessed value is to; (a) calculate 15% of the sum of 20% of the company’s capitalized earnings, plus (b) 80% of the company’s taxable stockholders’ equity, and to subtract from that figure 50% of the company’s real and personal property assessment. Various items may also be subtracted in calculating a company’s capitalized earnings.

Franchise Tax

The Company is also subject to the Louisiana franchise tax, which is imposed upon equity and certain borrowings (the franchise base) at a rate of $3 for every $1,000 of franchise base. Financial institution holding companies are allowed to reduce the franchise base to the extent of investments in and advances to subsidiary financial institutions.

Part II.

Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Item 7 of the Form 10-K is hereby amended and restated in its entirety to read as follows:

The following discussion and analysis of the financial condition and results of operations of GS Financial Corp. (the "Company") and its subsidiary, Guaranty Savings and Homestead Association, for the years ended December 31, 1996 through 2000 is designed to assist readers in their understanding of the Company. This review should be read in conjunction with the audited consolidated financial statements, accompanying footnotes and supplemental financial data included herein.

FORWARD-LOOKING STATEMENTS

In addition to historical information, this annual report includes certain "forward-looking statements" based on current management expectations. The Company’s actual results could differ materially, as defined in the Securities Act of 1933 and the Securities Exchange Act of 1934, from those management expectations. Such forward-looking statements include statements regarding our intentions, beliefs or current expectations as well as the assumptions on which such statements are based. Stockholders and potential stockholders are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Factors that could cause future results to vary from current management expectations include, but are not limited to, general economic conditions, legislative and regulatory changes, monetary and fiscal policies of the federal government, changes in tax policies, rates and regulations of federal, state and local tax authorities, changes in interest rates, deposit flows, the cost of funds, demand for loan products, demand for financial services, competition, changes in the quality or composition of the Company’s loan and investment portfolios, changes in accounting principles, policies or guidelines, and other economic, competitive, governmental and technological factors affecting the Company’s operations, markets, products, services and fees.

The Company undertakes no obligation to update or revise any forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

COMPARISON OF FINANCIAL CONDITION

ASSETS

General - Total assets of the Company decreased by $4.5 million from $158.0 million at December 31, 1999, to $153.5 million at December 31, 2000. The decrease was primarily due to the net effects of a $12.2 million decrease in mortgage-backed securities partially offset by a $4.4 million increase in loans receivable and a $1.6 million increase in collateralized mortgage obligations. The purpose of the sale of the majority of the mortgage-backed security portfolio was twofold, (1) create liquidity for loan originations and additional stock buybacks and (2) reposition some of the Company’s investments in response to changing interest rates.

Cash and Cash Equivalents - Cash and cash equivalents, consisting of interest and non-interest bearing deposits and Federal Funds Sold, increased $.9 million, or 36%, from $2.5 million at December 31, 1999, to $3.4 million at December 31, 2000. Cash and cash equivalents are utilized in the daily operations of the Company. The Company maintains cash and cash equivalents sufficient to meet the daily operational needs of the bank including, but not limited to, operating expenses, loan funding, deposit withdrawals and investment purchases. The Company also maintains positions in mutual funds that are invested mostly in mortgage-based products. These funds carry one-day availability and supplement the yield of overnight Federal Funds Sold and interest-bearing deposits in other financial institutions such as the Federal Home Loan Bank.

Loans Receivable, Net - Loans receivable, net, increased by $4.4 million, or 6%, from $70.1 million at December 31, 1999, to $74.5 million at December 31, 2000. The primary change in the loan portfolio was a $3.7 million increase in loans on 1-4 family dwellings, from $67.4 million in 1999 to $71.1 million in 2000. In the fall of 2000, the Company began offering commercial loans and was able to originate $.4 million in such loans. Consumer loans continued to decrease. Because of a slowdown in the local real estate market and the increase in interest rates, there was only a 6% growth in the loan portfolio in 2000 as compared to the 10% growth in 1999.

Investment Securities - Investment securities increased $.5 million, or 5%, from $10.5 million at December 31, 1999, to $11.0 million at December 31, 2000. The Company’s investment securities consist of United States Treasury and Agency issues, short-term mutual funds consisting primarily of qualified thrift investments, Federal Home Loan Mortgage Corporation (FHLMC) common and preferred stock and other equity investments. During 2000, because of its low dividend yield, the Company sold 10,000 shares of its FHLMC common stock at gain of $.4 million. The Company also purchased $3.5 million of FHLMC Preferred Stock. The FHLMC preferred stock purchased contained call options varying from three to seven years and coupons varying from 5% to 6%. Seventy percent of the dividends for the FHLMC preferred stock are tax free, boosting the effective yield of this investment. During 2000, the Company charged-off $.2 million of its Intermediate Mortgage Fund as it liquidated $2.4 million of this investment to fund the liquidity needs of the Company.

Mortgage-Backed Securities - Mortgage-backed securities decreased $12.2 million, or 75%, from $16.3 million at December 31, 1999, to $4.1 million at December 31, 2000. In 2000 the Company sold $10.6 million in mortgage-backed securities which resulted in a realized net loss of $.3 million. The Company completed these transactions to generate cash for loan growth, for stock repurchases and for new investment opportunities. At December 31, 2000 and 1999, all of the Company’s mortgage-backed securities were FHLMC, FNMA, or GNMA issued instruments. FHLMC and FNMA are enterprises sponsored by the Federal government while GNMA securities represent direct obligations of the Federal Government.

Collateralized Mortgage Obligations - The Company investment in Collateralized Mortgage Obligations (CMOs) is limited to first-tranche Real Estate Mortgage Investment Conduits (REMICs) which pay monthly. REMICs are multiple class mortgage-backed securities whereby an underlying pool of mortgages held by the issuer serves as collateral for the debt. The Company has REMICs issued by FNMA, FHLMC and "AAA" rated non-governmental agencies. The Company has found these instruments to be ideal for its wholesale growth strategy due to their regular repayment schedules and attractive yields. The expected life of these REMICs varies from two to fifteen years. Most of the investment in CMOs was funded by advances from the Federal Home Loan Bank. During 2000, the Company’s investment in CMOs increased $1.6 million, or 3%, from $52.1 million at December 31, 1999, to $53.7 million at December 31, 2000.

LIABILITIES AND STOCKHOLDERS’ EQUITY

General - The Company’s deposits, borrowings and equity represent sources of funds for its various investments and operating needs.

Deposits - The Company’s deposits decreased $.3 million, or 1%, from $59.2 million at December 31, 1999, to $58.9 million at December 31, 2000. The change was due to the net result of a $.7 million decrease in certificates of deposit, a $2.8 million decrease in passbook savings accounts and a $3.2 million increase in demand deposit accounts. Late in 1999, the Company began offering checking accounts and installed automated teller machines (ATM’s) at all of its locations. During 2000, the Company began offering NOW accounts.

Borrowings - The Company’s borrowings increased $.2 million, from $54.0 million at December 31, 1999 to $54.2 million at December 31, 2000. The Company’s borrowings consist of fully amortizing, balloon and "bullet"(interest only until maturity) advances from the Federal Home Loan Bank of Dallas which mature between 2001 and 2008. These borrowings represent the continuation of the Company’s wholesale growth strategy of leveraged investing.

Stockholders’ Equity - Stockholders’ equity decreased $5.7 million, or 13%, from $43.5 million at December 31, 1999, to $37.8 million at December 31, 2000. The net decrease was due to the net effects of stock buybacks of $8.6 million, net income of $1.2 million, $.8 million in dividends paid, an increase in accumulated other comprehensive income of $1.9 million along with other minor adjustments.

Treasury Stock - During 2000, the Company repurchased 679,600 shares of its common stock for $8.6 million or an average price of $12.65 per common share. Since the inception of its stock buyback program in 1998, the Company has repurchased 1,469,654 shares of its common stock at an average price of $13.99 per common share or $20.6 million, contributing to the enhancement of shareholder value. At December 31, 2000, the book value was $19.20 per common share. This compares to a book value of $16.44 per common share at December 31, 1999.

COMPARISON OF RESULTS OF OPERATIONS

General - The Company reported net income of $1.2 million, $1.4 million and $1.4 million for the years ended December 31, 2000, 1999, and 1998. The results for 2000 reflected generally the same results from 1999 offset by the net loss on sale of securities experienced in 2000. The earnings of the Company increased to $.60 per common share. The results of operations and earnings have been impacted through the continued stock repurchases of the Company. During the last three years the Company has repurchased $20.6 million of its common stock, with the largest portion ($8.6 million) being repurchased in 2000 when the Company reached the three year anniversary of its initial public offering and became free of many of the restrictions regarding stock repurchases.

Interest Income - Interest income increased $.6 million, or 6%, from $10.7 million in 1999 to $11.3 million in 2000. Overall results for 2000 reflected a yield of 7.42% on average earning assets of $151.7 million compared to average earning assets of $150.3 million in 1999 yielding 7.09%. Interest on CMO’s increased $.9 million, or 31%, in 2000 to $3.8 million as compared to $2.9 million in 1999. For the fifth consecutive year, interest on loans increased, from $5.3 million in 1999 to $5.8 million in 2000. This increase of $.5 million represented growth of 9%.

The yield on loans receivable decreased from 7.99% in 1999 to 7.96% in 2000. This, however, was offset by an increase in the average balance of net loans receivable of $5.9 million from 1999 to 2000. The drop in yield of the loan portfolio of only three basis points marks the end of many years of double-digit decreases. The "leveling out" of the yield of the loan portfolio was due to rising interest rates and the liquidation of many loans originated in the 1980s which had always skewed the arithmetic average yield upward.

Interest income on investment securities decreased $.6 million, or 60%, from $1.0 million in 1999 to $.4 million in 2000. The yield on investment securities went down from 6.30% in 1999 to 5.71% in 2000. The reduction in yield was due to the Company’s increased investment in mortgage-based mutual funds and FHLMC common stock compared to the Company’s portfolio of U.S. Treasury and Agency securities. The Company’s portfolio of U.S. Treasury and Agency securities yields approximately 7.25% and consists primarily of securities purchased at least three to four years ago when interest rates were significantly higher than present rates. The Company’s mortgage-based mutual funds typically yield between 5.5% and 6.0% and act as a short-term investment for the Company. The FHLMC common stock carries a dividend yield to the Company of approximately 3%. The average balance of investments decreased $8.0 million, or 52%, from 1999 to 2000. The decrease in balance was due to the Company’s redemption of some of its holdings in short-term mutual funds, calls of agency bonds and the sale of 10,000 shares of FHLMC common stock. As mentioned earlier this sale resulted in a realized gain of $.4 million.

			For the Years Ended December 31,
			2000			1999			1998
			Average		Yield/	Average		Yield/	Average		Yield/
			Balance	Interest	Rate	Balance	Interest	Rate	Balance	Interest	Rate
Interest Earning Assets
	Loans Receivable		72,744	5,788	7.96%	66,773	5,334	7.99%	59,511	4,912	8.25%
	Mortgage Backed Securities		11,985	800	6.68%	19,174	1,253	6.53%	28,918	1,833	6.34%
	Investment Securities		7,432	424	5.71%	15,427	972	6.30%	20,423	1,499	7.34%
	Collateralized Mortgage
		Obligations	53,136	3,799	7.15%	44,480	2,863	6.44%	17,662	1,118	6.33%
	Other Interest Earning Assets		6,421	451	7.02%	4,495	236	5.25%	7,363	223	3.03%
	Total Interest Earning Assets		151,718	11,262	7.42%	150,349	10,658	7.09%	133,877	9,585	7.16%
	Non Interest Earning Assets		1,752			5,277			5,894
	TOTAL ASSETS		153,470			155,626			139,771
Interest Bearing Liabilities
	Passbooks Deposits		18,957	572	3.02%	20,633	621	3.01%	22,284	680	3.05%
	Certificates of Deposits		39,151	2,094	5.35%	39,456	1,926	4.88%	35,636	1,791	5.03%
	Borrowings		53,944	3,290	5.95%	47,592	2,674	5.62%	27,879	1,616	5.80%
	Total Interest Bearing Liabilities		112,052	5,875	5.24%	107,681	5,221	4.85%	85,799	4,087	4.76%
	Non Interest Bearing Liabilities		1,238			4,499			4,932
	TOTAL LIABILITIES		113,290			112,180			90,731
	Retained Earnings		40,180			43,446			49,040
	TOTAL LIABILITIES AND
		RETAINED EARNINGS	153,470			155,626			139,771
Net Interest Earning Assets			39,666			42,668			48,078
Net Interest Income				5,387			5,437			5,498
Net Interest Spread					2.18%			2.24%			2.40%
Net Interest Margin					3.55%			3.62%			4.11%

Interest on Mortgage-backed securities decreased $.5 million from $1.3 million in 1999 to $.8 million in 2000. This represents a decrease of 27%. While the yield increased in 2000 to 6.68%, compared to 6.53% in 1999, the average balance decreased $7.1 million from $19.1 million in 1999 to $12.0 million in 2000, accounting for the decrease in income. The Company sold $10.6 million in mortgage-backed securities at a loss of $.3 million. The cash generated from the sale was used for stock repurchases, alternate investments and the funding of mortgage loans. The Company’s divestment in mortgage-backed securities and investment in CMOs can be explained by comparing the yield of these two investment vehicles. In 2000, the Company’s CMOs yielded 7.15% while the mortgage-backed securities yielded 6.68%.

The $.9 million increase in interest on CMO’s resulted from the increase in yield from 6.44% in 1999 to 7.15% in 2000 and the increase in average balance from $44.5 million in 1999 to $53.1 million in 2000. Interest on CMOs was $3.8 million in 2000 compared to $2.9 million in 1999.

Interest income from other interest earning assets approximately doubled from $.2 million in 1999 to $.4 million in 2000, which resulted from the Company maintaining higher average balances in Federal Funds Sold and other interest bearing deposits in other financial institutions and the higher interest rates paid thereon. The yield on other interest earning assets was 7.02% on an average balance of $6.4 million in 2000, compared to 5.25% on an average balance of $4.5 million in 1999. The yield in 2000 included a special one-time dividend paid on the Federal Home Loan Bank stock. The Company currently has $3.1 million in Federal Home Loan Bank stock.

RATE/VOLUME ANALYSIS

The following table shows the extent to which changes in interest rates and changes in volume of interest-related assets and liabilities affected interest income and expense during the periods indicated. For each category of interest-earning assets and interest-bearing liabilities, information is provided on changes attributable to (i) changes in volume (change in volume multiplied by prior year rate) and (ii) changes in rate (change in rate multiplied by prior year volume). The combined effect of changes in both rate and volume has been allocated proportionately to the change due to rate and the change due to volume.

INTEREST RATE/VOLUME ANALYSISFor December 31, 1998 - 2000 

			12/31/00 to 12/31/99			12/31/99 to 12/31/98
			Rate	Volume	Total	Rate	Volume	Total
Interest Income
		Loans	(20)	474	454	(124)	546	422
		MBS	31	(484)	(453)	(46)	(534)	(580)
		Invest	(91)	(457)	(548)	(182)	(345)	(527)
		CMO's	319	617	936	19	1,726	1,745
		Other	76	139	215	123	(110)	13
Total			315	289	604	(210)	1,283	1,073
Interest Expense
		Savings/NOW's	2	(51)	(49)	(9)	(50)	(59)
		Certificates	186	(18)	168	(54)	189	135
		Borrowings	154	381	535	17	1,041	1,058
Total			342	312	654	(46)	1,180	1,134
Increase(Decrease) in
	Net Interest Income		(27)	(23)	(50)	(164)	103	(61)

Interest Expense - Interest expense increased $.7 million, or 13%, from $5.2 million in 1999, compared to $5.9 million in 2000. Interest on FHLB advances increased $.5 million to $3.2 million in 2000 compared to $2.7 million in 1999. The increase was due to the rise in market rates dictated by the Federal Reserve’s three rate increases enacted during 2000. The cost of the Company’s FHLB advances were 5.95% in 2000 compared to 5.62% in 1999. The average balance of borrowings was $53.9 million in 2000 compared to $47.6 million in 1999. Interest expense on the Company’s retail deposits increased $.2 million to $2.7 million in 2000, compared to $2.5 million in 1999. While the cost of passbook savings was unchanged, the cost of the Company’s certificates of deposit increased to 5.35% in 2000 compared to 4.88% in 1999. The Company’s overall cost of funds for 2000 was 5.24% on average interest-bearing liabilities of $112.1 million. This compares to a cost of funds of 4.85% on an average balance of $107.7 million in 1999.

Provision for Loan Losses. The ALL is evaluated on a quarterly basis and provisions to increase or reductions to the ALL to a level deemed appropriate by management are made accordingly. Additional provisions are necessary when either growth in the loan portfolio or charge-offs drop the ALL below that level deemed appropriate by management. Reductions occur due to a decline in the size of the loan portfolio or when previously reserved-for loans are paid down or collected in full.

The low level of delinquent loans, the low number of foreclosures and the growth of the local economy over the last two years has enabled management to limit additional provisions to the ALL. The Company had provision for loan losses of $7,000 in 2000 compared to $6,000 in 1999. The $7,000 provision during the third quarter of 2000 was necessary following charge-offs of $11,000. During the fourth quarter of 1999, the $6,000 provision was necessitated because of growth in the loan portfolio. The provision for loan losses reflects management’s evaluation of the underlying credit risk of the Company’s loan portfolio to adequately provide for probable loan losses inherent in the loan portfolio as of the balance sheet date. The allowance for loan losses ("ALL") totaled 76.2% of non-performing assets at December 31, 2000, down from 371.9% at December 31, 1999. The difference was due to the virtual lack of non-performing assets at December 31, 1999. Non-performing assets were $114,000 at December 31, 1999 compared to $551,000 at December 31, 2000. Future additions to the allowance for loan losses will be dependent on a number of factors including the performance of the Association’s loan portfolio, the economy, changes in interest rates and the effect of such changes on real estate values, and inflation. Management believes that the allowance for loan losses is adequate at December 31, 2000.

Non-Interest Income - Non-interest income for 2000 was ($.1) million, resulting from the net loss on the sale or redemption of the Company’s various investments (FHLMC common stock, mortgage-backed securities and Intermediate Mortgage Fund). The Company’s other income consisting of various fees and service charges was unchanged.

Other Expenses - Other expenses increased $.1 million from $3.3 million for the twelve months ended December 31, 1999, compared to $3.4 million for the twelve months ended December 31, 2000. The increase was attributable to an increase in compensation expense of $.1 million. Ad Valorem taxes decreased $.1 million due to the reduction of shareholder equity at the subsidiary level with recent dividends from the Association to the Company. There were minor increases or decreases in all other expenses.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity measures the Company’s ability to meet its financial commitments and obligations on a timely basis. These commitments and obligations include loan disbursements, savings withdrawals by customers, the payment of dividends, cash letters and the daily operating expenses of the Company. Liquidity management involves the daily monitoring of cash on hand, non-interest bearing operating accounts, overnight Federal Funds Sold, short-term investments and the Company’s ability to convert these assets into cash without incurring a loss. Monthly paydowns on mortgage loans, mortgage-backed securities and collateralized mortgage obligations are anticipated and channeled to either cash on hand, overnight Federal Funds Sold or short-term investments in order to meet the Company’s demands and maximize interest earned on these funds.

The Company’s primary sources of funds are interest and non-interest bearing customer deposits, advances from the Federal Home Loan Bank and maturities of its existing investments including mortgage loans, mortgage-backed securities, investment securities and collateralized mortgage obligations. The Company offers competitive interest rates to maintain its core deposit base consisting of passbook savings, checking accounts and certificates of deposit. The Company does not utilize brokered deposits nor does it offer special rates for "jumbo" deposits of $100,000 or more. Gradual increases in interest rates have slowed prepayments of many of the Company’s assets during 2000. This has helped boost yields, particularly for short-term investments and the Company’s portfolio of CMO’s.

The Company, through the Association, is required under Federal regulations to maintain certain levels of liquid investments. Qualifying investments include United States Treasury and Federal Agency securities and other similar instruments having maturities of five years or less. The level of such investments may not be less than 4% of the Associations average withdrawable obligations as defined by the OTS. As of December 31, 2000, the Association’s liquidity stood at 57.06%, or $58.3 million in excess of the minimum requirement.

Guaranty Savings & Homestead Association, the Company’s wholly-owned subsidiary, is required to maintain regulatory capital sufficient to meet all three of the regulatory capital requirements, those being tangible capital (1.5%), core capital (3.0%), and risk-based capital (8.0%). As of December 31, 2000, the Association’s tangible and core capital amounted to $24.2, million or 16.2% of adjusted total assets, while the Association’s risk-based capital was $24.6 million, or 39.5% of total adjusted risk-weighted assets. Even though dividends declared and paid to the Company have reduced the capital level of the Association, the Company remains "well capitalized" under OTS standards. Since the initial public offering in 1997, the Company has endeavored to reduce its capital level through stock buybacks , retail or wholesale asset growth and other means.

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Item 8 of the Form 10-K is hereby amended and restated in its entirety to read as follows:

To The Board of Directors

GS Financial Corp. and Subsidiaries

Independent Auditor's Report

We have audited the accompanying consolidated balance sheets ofGS FINANCIAL CORP.and its wholly-owned subsidiary, GUARANTY SAVINGS AND HOMESTEAD ASSOCIATION as of December 31, 2000 and 1999, and the related consolidated statements of income, comprehensive income (loss), changes in stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2000. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position ofGS FINANCIAL CORP.and its wholly-owned subsidiary, GUARANTY SAVINGS AND HOMESTEAD ASSOCIATION as of December 31, 2000 and 1999, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2000, in conformity with generally accepted accounting principles.

/s/LaPorte, Sehrt, Romig and Hand

-------------------------------------------

A Professional Accounting Corporation

January 15, 2001

Metairie, Louisiana

GS FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
ASSETS
				December 31,
				2000		1999
CASH AND CASH EQUIVALENTS
	Cash and Amounts Due from Depository Institutions		$	531	$	145
	Interest-Bearing Deposits in Other Banks			1,417		1,759
	Federal Funds Sold			1,455		600
		Total Cash and Cash Equivalents		3,403		2,504
Securities Available-for-Sale, at Fair Value				11,000		10,483
Mortgage-Backed Securities Available-for-Sale,
	at Fair Value			4,115		16,275
Collateralized Mortgage Obligations Available-for-Sale,
	at Fair Value			53,745		52,080
Loans, Net				74,480		70,066
Accrued Interest Receivable				682		750
Premises and Equipment, Net				2,527		2,646
Real Estate Held-for-Investment				211		213
Stock in Federal Home Loan Bank, at Cost				3,115		2,866
Foreclosed Real Estate				117		14
Deferred Charges				61		49
Other Assets				44		36
		Total Assets	$	153,500	$	157,982

LIABILITIES AND STOCKHOLDERS' EQUITY
					December 31,
					2000		1999
LIABILITIES
	Deposits			$	58,879	$	59,216
	Advance Payments by Borrowers for Taxes and Insurance				931		767
	FHLB Advances				54,191		53,988
	Accrued Interest - FHLB Advances				279		261
	Accrued Income Tax				-		32
	Deferred Income Tax				1,044		17
	Other Liabilities				381		153
			Total Liabilities		115,705		114,434
STOCKHOLDERS' EQUITY
	Preferred Stock - $.01 Par Value; 5,000,000 Shares Authorized
		- 0 - Shares Issued and Outstanding			-		-
	Common Stock - $.01 Par Value; 20,000,000 Shares Authorized
		3,438,500 Shares Issued and Outstanding			34		34
	Additional Paid-in Capital				33,854		33,822
	Unearned ESOP Shares				(1,646)		(1,927)
	Unearned RRP Trust Stock				(1,754)		(1,974)
	Treasury Stock (1,469,654 Shares in 2000 and
		790,054 Shares in 1999) at Cost			(20,568)		(11,978)
	Retained Earnings				26,583		26,151
	Accumulated Other Comprehensive Income (Loss)				1,292		(580)
			Total Stockholders' Equity		37,795		43,548
			Total Liabilities and Stockholders' Equity	$	153,500	$	157,982

GS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands)
				For The Years Ended
				December 31,
				2000		1999		1998
INTEREST INCOME
	Loans Receivable		$	5,788	$	5,334	$	4,912
	Investment Securities			424		972		1,499
	Mortgage-Backed Securities			800		1,253		1,833
	Collateralized Mortgage Obligations			3,799		2,863		1,118
	Dividends on Federal Home Loan Bank Stock			237		139		88
	Other Interest Income			214		97		135
		Total Interest Income		11,262		10,658		9,585
INTEREST EXPENSE
	Deposits			2,666		2,547		2,471
	Advances from Federal Home Loan Bank			3,209		2,674		1,616
		Total Interest Expense		5,875		5,221		4,087
NET INTEREST INCOME BEFORE
	PROVISION FOR LOAN LOSSES			5,387		5,437		5,498
PROVISION FOR LOAN LOSSES				7		6		53
NET INTEREST INCOME AFTER
	PROVISION FOR LOAN LOSSES			5,380		5,431		5,445
NON-INTEREST INCOME
	Gain (Loss) on Sale of Investments			(146)		(18)		208
	Other Income			11		13		25
		Total Non-Interest Income		(135)		(5)		233

GS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME (Continued)
(Dollars in Thousands)
				For The Years Ended
				December 31,
				2000		1999		1998
NON-INTEREST EXPENSES
	Compensation and Employee Benefits			2,098		2,010		2,115
	Advertising			95		69		78
	Office Supplies, Telephone and Postage			109		119		126
	Net Occupancy Expense			323		293		291
	Legal Fees			13		38		21
	Audit and Consulting Fees			59		41		86
	Supervisory Fees			72		80		72
	Federal Insurance Premiums			12		35		35
	Data Processing Expense			129		82		77
	Real Estate Owned Expense - Net			2		(24)		(1)
	Ad Valorem Taxes			365		450		376
	Other			107		108		177
		Total Non-Interest Expenses		3,384		3,301		3,453
INCOME BEFORE INCOME TAX
	EXPENSE			1,861		2,125		2,225
INCOME TAX EXPENSE				666		750		870
NET INCOME			$	1,195	$	1,375	$	1,355
EARNINGS PER SHARE - BASIC				$0.60		$0.58		$0.49
EARNINGS PER SHARE - DILUTED				$0.60		$0.58		$0.49

GS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Dollars in Thousands)
				For the Years Ended
					December 31,
					2000		1999		1998
NET INCOME				$	1,195	$	1,375	$	1,355
OTHER COMPREHENSIVE INCOME,
	NET OF TAX:
		Unrealized Holding Gains (Losses) Arising
			During the Period		1,685		(2,361)		(79)
		Reclassification Adjustment for (Gains) Losses
			Included in Net Income		187		13		(11)
			Total Other Comprehensive Income (Loss)		1,872		(2,348)		(90)
COMPREHENSIVE INCOME (LOSS)				$	3,067	$	(973)	$	1,265
					====		====		====

GS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
For The Years Ended December 31, 2000, 1999 and 1998
(Dollars in Thousands)
					Unearned			Accumulated
			Add’l			RRP		Other	Total
		Common Stock	Paid-in Capital	Treasury Stock	ESOP Stock	Trust Stock	Retained Earnings	Comprehensive Income (Loss)	Stockholders' Equity
BALANCES AT DECEMBER 31, 1997		$34	$33,658	$ -	$(2,516)	$(2,076)	$25,089	$1,858	$56,047
Distribution of
	RRP Trust Stock	-	19	-	-	217	-	-	236
Common Stock Released
	By ESOP Trust	-	133	-	308	-	-	-	441
Common Stock Acquired by Recognition
	and Retention Trust	-	-	-	-	(334)	-	-	(334)
Purchase of Treasury Stock		-	-	(8,324)	-	-	-	-	(8,324)
Dividends Declared		-	-	-	-	-	(822)	-	(822)
Net Income - Year Ended
	December 31, 1998	-	-	-	-	-	1,355	-	1,355
Other Comprehensive Income (Loss), Net of Applicable
	Deferred Income Taxes	-	-	-	-	-	-	(90)	(90)
BALANCES AT DECEMBER 31, 1998		$34	$33,810	$(8,324)	$(2,208)	$(2,193)	$25,622	$1,768	$48,509
Distribution of
	RRP Trust Stock	-	(62)	-	-	219	-	-	157
Common Stock Released
	By ESOP Trust	-	74	-	281	-	-	-	355
Purchase of Treasury Stock		-	-	(3,654)	-	-	-	-	(3,654)
Dividends Declared		-	-	-	-	-	(846)	-	(846)
Net Income - Year Ended
	December 31, 1999	-	-	-	-	-	1,375	-	1,375
Other Comprehensive Income (Loss), Net of Applicable
	Deferred Income Taxes	-	-	-	-	-	-	(2,348)	(2,348)
BALANCES AT DECEMBER 31, 1999		$34	$33,822	$(11,978)	$(1,927)	$(1,974)	$26,151	$ (580)	$43,548
Distribution of
	RRP Trust Stock	-	(64)	-	-	220	-	-	156
Common Stock Released
	By ESOP Trust	-	96	-	281	-	-	-	377
Purchase of Treasury Stock		-	-	(8,590)	-	-	-	-	(8,590)
Dividends Declared		-	-	-	-	-	(763)	-	(763)
Net Income - Year Ended
	December 31, 2000	-	-	-	-	-	1,195	-	1,195
Other Comprehensive Income (Loss), Net of Applicable
	Deferred Income Taxes	-	-	-	-	-	-	1,872	1,872
BALANCES AT DECEMBER 31, 2000		$34 ==	$33,854 =====	$(20,568) ======	$(1,646) =====	$(1,754) =====	$26,583 =====	$1,292 ====	$37,795 =====

GS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
							For the Years Ended
							December 31,
							2000		1999		1998
CASH FLOWS FROM OPERATING ACTIVITIES
	Net Income					$	1,195	$	1,375	$	1,355
	Adjustments to Reconcile Net Income to Net Cash
		Provided by Operating Activities:
			Depreciation				139		114		123
			Discount Accretion Net of Premium Amortization				(129)		136		158
			Provision for Losses				7		6		53
			(Gain) Loss on Disposal of Fixed Assets				(8)		3		-
			Non-Cash Dividend - FHLB				(236)		(139)		(88)
			Net Loan Fees				(2)		(1)		(2)
			Dividend on ARM Fund				(51)		(86)		(587)
			Dividend on IMF Fund				(48)		(322)		(98)
			ESOP Expense				377		355		521
			RRP Expense				156		156		103
			Loss (Gain) on Sale of Foreclosed Real Estate				12		(23)		-
			Loss (Gain) on Sale of Investments				146		13		(208)
			Decrease (Increase) in Prepaid Income Taxes				-		69		(69)
			Increase in Deferred Income Tax				63		23		60
			Changes in Operating Assets and Liabilities:
				Decrease (Increase) in Accrued Interest Receivable			68		(61)		(102)
				(Increase) Decrease in Deferred Charges			(11)		8		(11)
				(Decrease) Increase in Accrued Income Tax			(32)		32		(93)
				Increase (Decrease) in Other Liabilities			227		(293)		328
				Increase in Accrued Interest - FHLB Advances			18		50		128
				Decrease (Increase) in Other Assets			(8)		3		12
					Net Cash Provided by Operating Activities		1,883		1,418		1,583

GS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
(Dollars in Thousands)
				For the Years Ended
				December 31,
2000					1999	1998
CASH FLOWS FROM INVESTING ACTIVITIES
	Purchase of Collateralized Mortgage Obligations		(8,647)		(31,362)	(51,302)
	Proceeds from Maturities of Collateralized Mortgage Obligations		9,108		19,175	9,589
	Proceeds from Sale of FHLMC Common Stock		413		-	-
	Purchase of FHLMC Preferred Stock		(3,507)		-	-
	Proceeds from Maturities of Available-for-Sale Securities		2,292		5,472	2,209
	Purchases of Mortgage-Backed Securities		-		-	(5,764)
	Proceeds from Maturities of Mortgage-Backed Securities		1,956		6,226	11,790
	Proceeds from Sale of Mortgage-Backed Securities		10,313		-	12,646
	(Purchase)/Redemption of ARM Mutual Fund		(1,390)		1,561	11,539
	(Purchase)/Redemption of IMF Mutual Fund		2,410		2,617	(5,169)
	Purchase of Other Equity Investments		(50)		-	-
	Loan Originations - Net		(4,528)		(6,203)	(10,358)
	Purchases of Premises and Equipment		(27)		(142)	(28)
	Proceeds from the Sale of Premises and Equipment		16		-	-
	Proceeds from Sales of Foreclosed Real Estate		2		41	-
	Capitalized Foreclosed Real Estate Costs		(8)		(4)	-
	Purchase of Federal Home Loan Bank Stock		(12)		(400)	(1,355)
		Net Cash Provided by (Used in) Investing Activities	8,341		(3,019)	(26,203)

GS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(Dollars in Thousands)
					For the Years Ended
					December 31,
					2000		1999		1998
CASH FLOWS FROM FINANCING ACTIVITIES
	Purchase of Treasury Stock				(8,590)		(3,654)		(8,324)
	Advances from Federal Home Loan Bank				202		8,607		29,224
	Payment of Cash Stock Dividends				(763)		(846)		(822)
	Purchase of Stock for Recognition and Retention Plan				-		-		(334)
	Net (Decrease) Increase in Deposits				(337)		(1,889)		4,283
	Net Increase (Decrease) in Non-Interest Bearing Deposits				163		77		(209)
			Net Cash (Used in) Provided by Financing Activities		(9,325)		2,295		23,818
NET INCREASE (DECREASE) IN CASH AND
	CASH EQUIVALENTS				899		694		(802)
CASH AND CASH EQUIVALENTS - Beginning of Year					2,504		1,810		2,612
CASH AND CASH EQUIVALENTS - End of Year				$	3,403	$	2,504	$	1,810
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
	Cash Paid During the Year for:
		Interest		$	5,847	$	5,168	$	4,095
		Income Taxes			618		622		878
	Loans Transferred to Foreclosed Real Estate
		During the Year			109		27		-
	Market Value Adjustment for Gain/(Loss)
		on Securities Available-for-Sale			1,958		(878)		2,679

GS FINANCIAL CORP.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF OPERATIONS

GS Financial Corp. (the "Company") was organized as a Louisiana corporation on December 24, 1996 for the purpose of becoming the holding company of Guaranty Savings and Homestead Association (the "Association") in anticipation of converting the Association from a Louisiana chartered mutual savings and loan association to a Louisiana chartered stock savings and loan association. Other than steps related to the reorganization described below, the Company was essentially inactive until April 1, 1997, when it acquired the Association in a business reorganization of entities under common control in a manner similar to a pooling of interest.The acquired Association became a wholly-owned subsidiary of the Company as part of the conversion through the exchange of 1,000 shares of common stock that consists of 100 percent of the outstanding stock of the Association. The Association operates in the savings and loan industry and as such provides financial services primarily to individuals, mainly through the origination of loans on one to four family residences, and the acceptance of deposits in the form of passbook savings, certificates of deposit, and demand deposit accounts.

The Association is subject to competition from other financial institutions, and is also subject to the regulations of certain Federal and State agencies and undergoes periodic examinations by those regulatory authorities.

PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Guaranty Savings and Homestead Association. In consolidation, significant inter-company accounts, transactions, and profits have been eliminated.

BASIS OF FINANCIAL STATEMENT PRESENTATION

The financial statements have been prepared in conformity with generally accepted accounting principles. In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the statement of financial condition and revenues and expenses for the year. Actual results could differ significantly from those estimates.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for losses on loans and valuation of real estate acquired in connection with foreclosures or in satisfaction of loans. Management independently determines the allowance for losses on loans based on an evaluation of the loan history and the condition of the underlying properties. In connection with the determination of the allowances for losses on foreclosed real estate, management obtains independent appraisals for all properties.

While management uses available information to recognize losses on loans and foreclosed real estate, future additions to the allowances may be necessary based on changes in local economic conditions. In addition, regulatory agencies, as an integral part of their examination process, periodically review the Association’s allowances for losses on loans and foreclosed real estate. Such agencies may require the Association to recognize additions to the allowances based on their judgments about information available to them at the time of their examination.

CASH AND CASH EQUIVALENTS

For the purposes of presentation in the consolidated statements of cash flows, cash and cash equivalents include all cash and amounts due from depository institutions, interest-bearing deposits in other banks, and Federal Funds Sold.

INVESTMENT SECURITIES

Marketable securities are classified as available-for-sale and are carried at fair value. Unrealized gains and losses on securities available-for-sale are recognized as direct increases or decreases in comprehensive income. The cost of securities sold is recognized using the specific identification method. Premiums and discounts are being amortized over the life of the securities as a yield adjustment.

MORTGAGE-BACKED SECURITIES

Mortgage-backed securities represent participating interests in pools of first mortgage loans originated and serviced by issuers of the securities. Unrealized gains and losses on mortgage-backed securities are recognized as direct increases or decreases in comprehensive income. The cost of securities sold is recognized using the specific identification method. Premiums and discounts are being amortized over the life of the securities as a yield adjustment. During 2000, the Company held mortgage-backed securities issued by the Government National Mortgage Association, the Federal Home Loan Mortgage Corporation, and the Federal National Mortgage Association.

COLLATERALIZED MORTGAGE OBLIGATIONS

Collateralized Mortgage Obligations (CMO’s) are multiple class mortgage-backed securities. An underlying pool of mortgages held by the issuer serves as collateral for the debt obligations, and principal and interest payments from the pool of mortgages are used to retire the CMO’s.

Currently, the Company’s investment in CMO’s is limited to first-tranche Real Estate Mortgage Investment Conduits (REMIC’s). A REMIC is a pass-through investment vehicle created under the Tax Reform Act of 1986 to issue multiple class mortgage-backed securities. The multiple classes in a REMIC are known as "tranches".

Currently, the Company’s investment in REMIC’s is limited to those issued by FNMA, FHLMC and "AAA" rated non-governmental agencies. These are defined to be within the 20% risk-weighted category for thrift institutions. Prior to investing, the Company receives a prospectus that includes the various cash flow and interest rate risk scenarios possible for each bond.

Unrealized gains and losses on CMO’s are recognized as direct increases or decreases in comprehensive income. The cost of securities sold is recognized using the specific identification method. Premiums and discounts are being amortized over the life of the securities as a yield adjustment.

LOANS

Loans are stated at unpaid principal balances, less the allowance for loan losses and net deferred loan fees.

Loan origination and commitment fees, as well as certain direct origination costs, are deferred and amortized as a yield adjustment over the contractual lives of the related loans using the interest method.

Loans are placed on non-accrual when principal or interest is delinquent for 90 days or more. Any unpaid interest previously accrued on those loans is reversed from income, and thereafter interest is recognized only to the extent of payments received.

A loan is considered impaired when, based on current information and events, it is probable that a creditor will be unable to collect all amounts due according to the contractual terms of the loan agreement. Interest payments on impaired loans are typically applied to principal unless collectibility of the principal amount is fully assured, in which case interest is recognized on the cash basis. Residential mortgage loans and consumer installment loans are considered to be groups of smaller balance homogeneous loans and are collectively evaluated for impairment and are not subject to SFAS 114 measurement criteria.

The allowance for loan losses is maintained at a level that, in management’s judgment, is adequate to absorb probable losses inherent in the loan portfolio. The amount of the allowance is based on management’s evaluation of the collectibility of the loan portfolio, including the nature of the portfolio, credit concentrations, trends in historical loss experience, specific impaired loans, and economic conditions. The allowance is increased by a provision for loan losses, which is charged to expense, and reduced by charge-offs, net of recoveries. Changes in the allowance relating to impaired loans are charged or credited to the provision for loan losses.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost, less accumulated depreciation computed principally on the straight-line and modified accelerated cost recovery methods over the estimated useful lives of the assets which range from 5 to 10 years for furniture and equipment, and 31 to 39 years for buildings. Maintenance and repairs are expensed as incurred, while major additions and improvements are capitalized.

When these assets are retired or otherwise disposed of, the cost and related accumulated depreciation or amortization are removed from the accounts, and any resulting gain or loss is reflected in income for the period.

FORECLOSED REAL ESTATE

Foreclosed real estate includes real estate acquired in settlement of loans. At the time of foreclosure, foreclosed real estate is recorded at the lower of the Association’s cost or the asset’s fair value, less estimated selling costs, which becomes the property’s new basis. After foreclosure, valuations are periodically performed by management and the real estate is carried at the lower of cost or fair value less estimated selling costs. Costs incurred in maintaining foreclosed real estate are included in income (loss) on foreclosed real estate.

REAL ESTATE HELD-FOR-INVESTMENT

Real estate held-for-investment consists of the land and building of a former branch location of the Association. Due to regulatory considerations, the Association sold this property to the Company during 1998 at fair value. The gain on the sale realized by the Association is eliminated through consolidation. During 2000, the Company transferred the remaining book value of the building to land. The Company plans to redevelop this property in 2001, and all existing structures are to be demolished.

INCOME TAXES

The Company and its wholly-owned subsidiary file a consolidated Federal income tax return on a calendar year basis. Each entity pays its pro rata shares of income taxes in accordance with a written tax-sharing agreement.

Income taxes are provided for the tax effects of the transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related to differences between the basis of assets and liabilities for financial and income tax reporting. The deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of the deferred tax asset will not be realized. Deferred tax assets and liabilities are adjusted for the effect of changes in tax laws and rates on the date of enactment.

While the Association is exempt from Louisiana income tax, it is subject to the Louisiana Ad Valorem tax that is based on stockholders’ equity and net income.

NON-DIRECT RESPONSE ADVERTISING COSTS

The Company expenses advertising costs as incurred. Advertising cost were $95,000, $69,000 and $78,000 for the years ended December 31, 2000, 1999 and 1998, respectively.

NEW ACCOUNTING STANDARDS

Statement of Financial Accounting Standards No. 138 (SFAS 138),Accounting for Certain Derivative Instruments and Certain Hedging Activities, an amendment of SFAS 133, is effective for the quarter beginning after June 15, 2000. This statement addresses a limited number of issues causing implementation difficulties for entities that apply SFAS 133, which requires all derivatives to be recognized at fair value as either assets or liabilities in the consolidated balances sheets. Changes in the fair value of derivatives not designated as hedging instruments are to be recognized currently in earnings. Gains or losses on derivatives designated as hedging instruments are either to be recognized currently in earnings or are to be recognized as a component of other comprehensive income, depending on the intended use of the derivatives and the resulting designation. Adoption of this pronouncement had no effect on the financial position and results of operations of the Company.

Statement of Financial Accounting Standards No. 140 (SFAS 140),Accounting for Transfers and servicing of Financial Assets and Extinguishments of Liabilities, is a replacement of SFAS 125. This statement provides accounting and reporting standards for transfers and servicing of financial assets and extinguishments of liabilities. Those standards are based on consistent application of a financial-components approach that focuses on control. Under this approach, after a transfer of financial assets, an entity recognizes the financial and servicing assets it controls and the liabilities it has incurred, derecognizes financial assets when control has been surrendered, and derecognizes liabilities when extinguished. This statement provides consistent standards for distinguishing transfers of financial assets that are sales from transfers that are secured borrowings. This statement is effective for transfers and servicing of financial assets and extinguishments of liabilities occurring after March 31, 2001 and for recognition and reclassification of collateral and for disclosures relating to securitization transactions and collateral for years ending after December 15, 2000. The adoption of this pronouncement had no effect on the financial position and results of operations of the Company.

NOTE B

INVESTMENT SECURITIES

Securities available-for-sale consist of the following (in thousands):

	December 31, 2000		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
			----------		----------		----------		----------
U. S. Government
	and Federal Agencies	$	2,389	$	72	$	-	$	2,461
Adjustable Rate
	Mortgage Mutual Fund		2,831		-		8		2,823
Intermediate
	Mortgage Mutual Fund		400		-		30		370
FHLMC Common Stock			25		1,767		-		1,792
FHLMC Preferred Stock			3,506				2		3,504
Equity Investments - Other			50		-		-		50
			-------		-------		-------		-------
		$	9,201	$	1,839	$	40	$	11,000
			=====		=====		=====		=====
	December 31, 1999		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
			----------		----------		----------		----------
U. S. Government
	and Federal Agencies	$	4,678	$	35	$	30	$	4,683
Adjustable Rate
	Mortgage Mutual Fund		1,390		-		9		1,381
Intermediate
	Mortgage Mutual Fund		2,972		-		247		2,725
FHLMC Common Stock			35		1,659		-		1,694
			-------		-------		-------		-------
		$	9,075	$	1,694	$	286	$	10,483
			=====		=====		=====		=====

The following is a summary of maturities of securities available-for-sale (in thousands):

		December 31,
		2000 Securities Available-for-Sale				1999 Securities Available-for-Sale
				Amortized Cost	Fair Value		Amortized Cost		Fair Value
				---------	---------		---------		---------
Amounts Maturing in:
	In One Year or Less		$	7,911	9,643	$	4,997	$	6,407
	After One Year Through Five Years			300	326		1,398		1,416
	After Five Years Through Ten Years			990	1,031		2,680		2,660
				------	------		------		------
			$	9,201	11,000	$	9,075	$	10,483
				=====	=====		=====		=====

The Company is holding agency securities in the amount of $500,000 that are callable in 2001. The Company is holding FHLMC preferred stock callable in 2004 and 2009.

During 2000, the Company realized losses of $210,000 through the redemption of $2.6 million of its Intermediate Mortgage Mutual Fund. The Company also sold 10,000 shares of FHLMC common stock for $413,000, realizing a gain of $403,000. During 1999, the Company realized losses of $13,387 through the redemption of $3.1 million of its Adjustable Rate Mortgage Fund. During 1998, the Company realized losses of $57,565 through the net redemption of $11.5 million of its Adjustable Rate Mortgage Fund.

Included in other assets are two equity securities being carried at cost of $27,000. The fair value for these securities approximates cost.

NOTE C

MORTGAGE-BACKED SECURITIES

Mortgage-backed securities consist of the following (in thousands):

December 31, 2000		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		----------		----------		----------		----------
Available for Sale:
FNMA	$	1,481	$	-	$	5	$	1,476
FHLMC		1,096		-		2		1,094
GNMA		1,541		4		-		1,545
		-------		-------		-------		-------
	$	4,118	$	4	$	7	$	4,115
		=====		=====		=====		=====
December 31, 1999		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		----------		----------		----------		----------
Available for Sale:
FNMA	$	5,255	$	1	$	81	$	5,175
FHLMC		1,328		3		34		1,297
GNMA		10,160		-		357		9,803
		-------		-------		-------		-------
	$	16,743	$	4	$	472	$	16,275
		=====		=====		=====		=====

The amortized cost and fair value of mortgage-backed securities at December 31, 2000 and 1999, by contractual maturity, are shown below (in thousands). Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations without call or prepayment penalties.

	December 31, 2000		Amortized Cost		Fair Value
			---------		---------
Mortgage-Backed Securities Maturing:
	In One Year or Less	$	230	$	230
	After One Year Through Five Years		814		819
	After Five Years Through Ten Years		1,187		1,177
	After Ten Years		1,887		1,889
			------		------
		$	4,118	$	4,115
			=====		=====

	December 31, 1999		Amortized Cost		Fair Value
			---------		---------
Mortgage-Backed Securities Maturing:
	In One Year or Less	$	112	$	113
	After One Year Through Five Years		1,411		1,405
	After Five Years Through Ten Years		1,403		1,339
	After Ten Years		13,817		13,418
			--------		--------
		$	16,743	$	16,275
			=====		=====

In 2000, the Company sold GNMA and FNMA mortgage-backed securities with a book value of $10,581,506 , resulting in a loss of $337,000. There were no sales of mortgage-backed securities in 1999. During 1998, the Company sold mortgage-backed securities with a book value of $12,387,568 for $12,646,040. This resulted in a realized gain of $258,471.

NOTE D

COLLATERALIZED MORTGAGE OBLIGATIONS

Collateralized Mortgage Obligations (CMO’s) consist of the following (in thousands):

December 31, 2000		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		----------		----------		----------		----------
Available-for-Sale:
FNMA	$	5,766	$	-	$	187	$	5,579
FHLMC		14,254		196		309		14,141
GNMA		33,562		583		120		34,025
		-------		-------		-------		-------
	$	53,582	$	779	$	616	$	53,745
		=====		=====		=====		=====

December 31, 1999		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
		----------		----------		----------		----------
Available-for-Sale:
FNMA	$	8,058	$	-	$	474	$	7,584
FHLMC		17,347		167		690		16,824
GNMA		28,493		15		836		27,672
		-------		-------		-------		-------
	$	53,898	$	182	$	2,000	$	52,080
		=====		=====		=====		=====

At December 31, 2000 and 1999, CMO’s are classified as available-for-sale, and are reported on the financial statements at their fair value. Also, all of the CMO’s held as of December 31, 2000 and 1999 have contractual maturities of greater than ten years. There were no sales of CMO’s during 2000, 1999 and 1998.

At December 31, 2000, a CMO with a market value of $766,073 has been pledged as collateral towards the outstanding balance of Advances from the Federal Home Loan Bank.

NOTE E

LOANS

Loans at December 31, 2000 and 1999 are summarized as follows (in thousands):

					December 31,
					2000			1999
First Mortgage Loans:
	One to Four
		Family Residential		$	71,092		$	67,424
	FHA and VA				52			140
	Construction				619			646
	Commercial Real Estate				1,006			1,377
	Other				1,453			446
					---------			---------
			Total Real Estate Loans			74,222			70,033
Consumer Loans:
	Second Mortgage				52			84
	Loans on Deposits				237			367
					---------			---------
		Total Consumer Loans			289			451
Commercial Loans					381			-
					---------			---------
					74,892			70,484
Allowance for
	Loan Losses				(420)			(424)
Net Deferred Loan
	Origination Costs				8			6
					---------			---------
Net Loans				$	74,480		$	70,066
					=====			=====

An analysis of the allowance for loan losses as follows (in thousands):

			Years Ended December 31,
			2000		1999		1998
			-----		-----		-----
Balance, Beginning
	of Year	$	424	$	463	$	410
Provision for Losses			7		6		53
Loans Charged Off			(11)		(45)		-
Recoveries			-		-		-
			-----		-----		-----
Balance, End of Year		$	420	$	424	$	463
			====		====		====

Loans receivable as of December 31, 2000 are scheduled to mature and adjustable rate loans are scheduled to reprice as follows (in thousands):

			Under One Year		One to Five Years		Six to Ten Years		Over 10 Years		Total
			------		------		------		------		------
Loans Secured by 1-4 Family
	Residential:
Fixed Rate		$	65	$	2,054	$	9,740	$	59,233	$	71,092
Other Loans Secured by
	Real Estate:
Fixed Rate			32		111		331		2,708		3,182
Commercial Fixed Rate			99		-		-		282		381
All Other Loans			237		-		-		-		237
			------		------		------		------		------
		$	433	$	2,165	$	10,071	$	62,223	$	74,892
			=====		=====		=====		=====		=====

At December 31, 2000 and 1999, the Association had loans totaling approximately $320,000 and $254,000, respectively, for which impairment had been recognized. The allowance for loan losses related to these loans totaled $68,000 and $64,000 at December 31, 2000 and 1999, respectively. The amount of interest income that would have been recorded on loans in non-accrual status at December 31, 2000, had such loans performed in accordance with their terms, was approximately $20,000. Such interest foregone for the year ended December 31, 1999 was approximately $3,000.

In the ordinary course of business, the Association has and expects to continue to have transactions, including borrowings, with its officers and directors. In the opinion of management, such transactions were on substantially the same terms, including interest rates and collateral, as those prevailing at the time of comparable transactions with other persons and did not involve more than a normal risk of collectibility or present any other unfavorable features to the Association.

Loans to such borrowers are summarized as follows (in thousands):

			December 31,
			2000		1999
Balance, Beginning
	of Year	$	904	$	949
Additions			602		-
Payments and Renewal			(52)		(45)
			---------		---------
Balance, End of Year			1,454		904

The Association’s lending activity is concentrated within the metropolitan New Orleans area and surrounding parishes, with its major emphasis in the origination of permanent single-family dwelling loans. Such loans comprise the majority of the Association’s loan portfolio.

NOTE F

ACCRUED INTEREST RECEIVABLE

Accrued interest receivable at December 31, 2000 and 1999 consists of the following (in thousands):

		December 31,
		2000		1999
Loans	$	311	$	267
Mortgage-Backed Securities		24		97
Collateralized Mortgage Obligations		304		300
Investments and Other		43		86
		------		------
Totals	$	682	$	750
		====		====

NOTE G

PREMISES AND EQUIPMENT

A summary of premises and equipment follows (in thousands):

		December 31,
		2000		1999
Land	$	781	$	781
Buildings and Improvements		2,071		2,071
Furniture, Fixture and Equipment		526		537
		------		------
		3,378		3,389
Accumulated Depreciation and Amortization		(851)		(743)
		------		------
	$	2,527	$	2,646
		====		====

Depreciation expense for the years ended December 31, 2000, 1999 and 1998 was approximately $137,000, $112,000 and $123,000, respectively.

NOTE H

FORECLOSED REAL ESTATE

A summary of the activity of the Foreclosed Real Estate account follows:

		December 31,
		2000		1999
Balance - Beginning of the Year	$	14	$	-
Acquired in Settlement of Loans		109		27
Costs Capitalized		8		4
Sales of Foreclosed Real Estate		(14)		(17)
Less: Allowance for Losses on Foreclosed Real Estate		-		-
		------		------
	$	117	$	14
		====		====

Expenses applicable to foreclosed real estate consists of operating expenses, net of rental income, and gains and losses on sales of real estate. The Company incurred net expenses associated with foreclosed real estate of approximately $2,000 for the year ended December 31, 2000. For the years ended December 31, 1999 and 1998, the Company recognized net income associated with foreclosed real estate of approximately $24,000 and $1,000, respectively.

NOTE I

REAL ESTATE HELD-FOR-INVESTMENT

Real estate held-for-investment consists of a former branch location as summarized below (in thousands):

		December 31,
		2000		1999
Land	$	211	$	200
Buildings and Improvements		-		17
		------		------
		211		217
Accumulated Depreciation		-		(4)
		------		------
	$	211	$	213
		====		====

Depreciation expense for each of the years ended December 31, 2000, 1999 and 1998 was $2,000, $3,000 and $1,000, respectively.

During 2000, the Company transferred the remaining book value of the building to land. The Company plans to redevelop this property in 2001, and all existing structures are to be demolished.

The Company leased this property on a month-to-month basis for $1,600 per month. The lease was terminated in March, 1999. Total rental income recognized was approximately $1,700 and $20,000 for the years ended December 31, 1999 and 1998, respectively.

On February 20, 1998, in response to regulatory considerations, the Company purchased from the Association a former branch location and adjoining property for $453,000. The purchase price was based on the appraised value of the property at the time of the transaction. This inter-company transaction resulted in a gain to the Association of approximately $178,000, which is eliminated for the purposes of these consolidated financial statements.

NOTE J

DEPOSITS

Deposit account balances at December 31, 2000 and 1999 are summarized as follows:

		Weighted Average Rate at					Year Ended December 31,
		December 31,					2000				1999
		2000		1999			Amount	Percent			Amount	Percent
Balance by Interest Rate:
Demand Deposit
	Accounts	4.64	%	N/A	%	$	3,185	5.41	%	$	44	0.08	%
Regular Savings
	Accounts	3.00	%	3.00	%		17,431	29.60			20,170	34.06
Certificates of
	Deposit	5.85	%	5.00	%		38,263	64.99			39,002	65.86
						$	58,879	100.00	%	$	59,216	100.00	%
							======	=====			======	=====
Certificate Accounts Maturing
	Under 12 months					$	29,478	77.04	%	$	30,270	77.61	%
	12 months to 24 months						6,387	16.69			7,226	18.53
	24 months to 36 months						1,710	4.47			1,086	2.78
	36 months to 48 months						251	0.66			167	0.43
	48 months to 60 months						437	1.14			253	0.65
						$	38,263	100.00	%	$	39,002	100.00	%
							======	=====			======	=====

The aggregate amount of deposits with a minimum balance of $100,000 was approximately $3,928,000 and $1,497,000 at December 31, 2000 and 1999, respectively.

Interest expense for each of the following periods is as follows (in thousands):

		Years Ended December 31,
		2000		1999		1998
Certificates	$	2,094	$	1,926	$	1,790
Passbook Savings	$	572	$	621	$	681
	$	2,666	$	2,547	$	2,471

The Association held deposits of approximately $653,000 and $575,000 for officers and directors at December 31, 2000 and 1999, respectively.

NOTE K

ADVANCES FROM FEDERAL HOME LOAN BANK

Pursuant to collateral agreements with the Federal Home Loan Bank (FHLB), advances are secured by a blanket floating lien on first mortgage loans. Total interest expense recognized in 2000, 1999 and 1998, respectively, was $3,209,000, $2,674,000 and $1,616,000.

Advances at December 31, 2000 and 1999 consisted of the following (in thousands):

Contract Rate	Advance Total
		2000		1999
4.00% to 4.99%	$	3,273	$	4,262
5.00% to 5.99%		21,788		29,942
6.00% to 6.99%		24,130		19,784
7.00% to 7.99%		5,000		-
	$	54,191	$	53,988
		=====		=====

Maturities of Advances at December 31, 2000 for each of the next five years are as follows (in thousands):

Year Ending
December 31,		Amount
2001	$	19,318
2002		7,828
2003		8,329
2004		-
2005		6,709
Thereafter		12,007
	$	54,191

NOTE L

INCOME TAX EXPENSE

The provision for income taxes for 2000, 1999 and 1998 consists of the following (in thousands):

		Years Ended December 31,
		2000		1999		1998
Current Tax Expense	$	603	$	718	$	808
Deferred Tax Expense	$	63	$	32	$	62
	$	666	$	750	$	870

The provision for Federal income taxes differs from that computed by applying Federal statutory rates to income (loss) before Federal income tax expense, as indicated in the following analysis (in thousands):

		Years Ended December 31,
		2000		1999		1998
Expected Tax Provision at a 34% Rate	$	633	$	722	$	735
Expected State Corporate Tax		9		8		28
Effect of Tax Exempt Income		(5)		(5)		(3)
Employee Stock Ownership Plan		20		25		73
Other		9		-		37
	$	666	$	750	$	870

Deferred tax liabilities have been provided for the temporary differences related to unrealized gains on available-for-sale securities, deferred loan costs, depreciation, and non-cash Federal Home Loan Bank dividends. Deferred tax assets have been provided for the temporary differences related to the Company’s Recognition and Retention Plan and Employee Stock Ownership Plan, unrealized losses on available-for-sale securities, the allowance for loan losses, reserves for uncollected interest and late charges, deferred loan fees, and the allowance for losses on foreclosed real estate. The net deferred tax assets or liabilities in the accompanying statements of financial condition include the following components (in thousands):

				2000		1999
Deferred Tax Assets
	Recognition and Retention Plan		$	13	$	13
	Employee Stock Ownership Plan			80		65
	Market Value Adjustment to
		Available-for-Sale Securities		-		299
	Other			9		4
	Total Deferred Tax Assets			102		381

				2000		1999
Deferred Tax Liabilities
	FHLB Stock Dividends		$	235	$	154
	Market Value Adjustment to
		Available-for-Sale Securities		666		-
	Allowance for Loan Losses			187		191
	Other			58		53
	Total Deferred Tax Liabilities			1,146		398
Deferred Tax Liabilities - Net of Deferred Tax Assets			$	1,044	$	17
				====		====

Included in retained earnings at December 31, 2000 and 1999 is approximately $3,800,000 in bad debt reserves for which no deferred Federal income tax liability has been recorded. These amounts represent allocations of income to bad debt deductions for tax purposes only. Reduction of these reserves for purposes other than tax bad-debt losses or adjustments arising from carryback of net operating losses would create income for tax purposes, which would be subject to the then-current corporate income tax rate. The unrecorded deferred liability on these amounts was approximately $1,292,000 for December 31, 2000 and 1999, respectively.

NOTE M

EMPLOYEE STOCK OWNERSHIP PLAN

During 1997, GS Financial Corp. instituted an employee stock ownership plan (the "ESOP") that covers all employees of Guaranty Savings and Homestead Association who have completed one year of service and have attained the age of 21. The ESOP purchased the statutory limit of eight percent of the shares offered in the initial public offering of the Company (275,080 shares). This purchase was facilitated by a loan from the Company to the ESOP in the amount of $2,750,800. The loan is secured by a pledge of the ESOP shares. The shares pledged as collateral are reported as unearned ESOP shares in the balance sheets. The corresponding note is to be paid back in 40 equal quarterly payments of $103,000 on the last business day of each quarter, beginning June 30, 1997 at the rate of 8.5%. The note payable and the corresponding note receivable have been eliminated for consolidation purposes.

The Association may contribute to the plan, in the form of debt service, at the discretion of its board of directors. Dividends received on ESOP shares are either utilized to service the debt or credited to participant accounts at the discretion of the trustees of the Plan. Shares are released for allocation to plan participants based on principal and interest payments of the note. Compensation expense is recognized based on the number of shares allocated to plan participants and the average market price of the stock for the current year. Released ESOP shares become outstanding for earnings per share computations.

As compensation expense is incurred, the Unearned ESOP Shares account is reduced based on the original cost of the stock. The difference between the cost and average market price of shares released for allocation is applied to Additional Paid-in Capital. ESOP compensation expense was approximately $377,000, $355,000 and $521,000 for the years ended December 31, 2000, 1999 and 1998, respectively.

The ESOP shares as of December 31, 2000 and 1999 were as follows:

		2000		1999
Allocated Shares		78,215		52,268
Shares Released for Allocation		28,132		28,132
Unreleased Shares		164,583		192,715
Total ESOP Shares		270,930		273,115
		======		======
Fair Value of Unreleased Shares (in thousands)	$	2,397	$	2,361
		====		====

Total ESOP shares decreased in 2000 and 1999 due to the liquidation of shares for employees who terminated their employment in 2000 and 1999.

NOTE N

RECOGNITION AND RETENTION PLAN

On October 15, 1997, the Company established a Recognition and Retention Plan (the "Plan") as an incentive to retain personnel of experience and ability in key positions. The Company approved a total of 137,540 shares of stock to be acquired for the Plan, of which 125,028 shares have been allocated for distribution to key employees and directors. As shares are acquired for the Plan, the purchase price of these shares is recorded as unearned compensation, a contra equity account. As the shares are distributed, the contra equity account is reduced.

During 1998, by unanimous approval of the Plan participants, the Plan was amended as a direct effort to reduce the Company’s expenses resulting from the Plan. Prior to the amendment to the Plan, Plan share awards were earned by recipients at a rate of 20% of the aggregate number of shares covered by the Plan over five years. The amended Plan stipulates that Plan share awards are earned by recipients at a rate of 10% of the aggregate number of shares covered by the plan over ten years. If the employment of an employee or service as a non-employee director is terminated prior to the tenth anniversary of the date of grant of Plan share award for any reason (except for death, disability or retirement), the recipient shall forfeit the right to any shares subject to the award which have not been earned.

The total cost associated with the Plan is based on a per share value of $12.50, the market price of the Company’s stock as of the date on which the Plan was amended. This cost is being amortized over ten years. Compensation expense pertaining to the Recognition and Retention plan was $156,000, $156,000 and $103,000 for the years ended December 31, 2000, 1999 and 1998, respectively.

A summary of the changes in restricted stock follows:

	Unawarded Shares	Awarded Shares
Balance at January 1, 1999	12,472	112,529
Purchased by Plan	-	-
Granted	-	-
Forfeited	-	-
Earned and Issued	-	(12,501)
Balance at December 31, 1999	12,472	100,028
Purchased by Plan	-	-
Granted	-	-
Forfeited	-	-
Earned and Issued	-	(12,506)
Balance at December 31, 2000	12,472	87,522
	=====	=====

NOTE O

STOCK OPTION PLAN

In 1997, the Company adopted a stock option plan for the benefit of directors, officers, and other key employees. The number of shares of common stock reserved for issuance under the stock option plan was 343,850 shares, or ten percent of the total number of shares of common stock sold in the Company’s initial public offering of its common stock.

The plan also permits the granting of Stock Appreciation Rights (SAR’s). SAR’s entitle the holder to receive, in the form of cash or stock, the increase in the fair value of the Company stock from the date of grant to the date of exercise. No SAR’s have been issued under the plan.

On October 15, 1997, the Company granted a total of 275,076 options to directors, officers, and other key employees. Under the plan, the exercise price of each option cannot be less than the fair value of the underlying common stock as of the date of the option grant, and the maximum term is 10 years. Options vest over five years.

The Company accounts for the plan under the guidance of Accounting Principles Board (APB) Opinion No. 25,Accounting for Stock Issued to Employees. No compensation costs has been recognized in the financial statements of the Company since the exercise option price cannot be less than market price of the stock at the date of the grant. However, SFAS No. 123,Accounting for Stock-Based Compensation, requires the disclosure of the compensation costs for stock-based incentives granted after January 31, 1995 based on the fair value at the grant date for awards. Applying SFAS No. 123 would result in pro forma net income and earnings per share amounts as follows:

		2000	1999	1998
Net Income (In thousands)
	As Reported	$1,195	$1,375	$1,355
	Pro Forma	607	1,056	1,085
Earnings per Share
	As Reported:
	Basic	$.60	$.58	$.49
	Diluted	.60	.58	.49
	Pro Forma:
	Basic	.31	.44	.39
	Diluted	.31	.44	.39

The fair value of options granted on October 15, 1997 was estimated as of the date of the grant using the Black-Scholes option-pricing model with the following assumptions: dividend yield of 1.59%; expected volatility of 16.2%; risk-free interest rate of 6.14%; and life of 9.88 years.

A summary of the status of the Company’s stock option plan as of December 31, 2000, 1999, and 1998, and changes during the years ending on those dates is presented below:

	2000		1999		1998
		Exercise		Exercise		Exercise
Fixed Options	Shares	Price	Shares	Price	Shares	Price
Outstanding at Beginning of Year	275,076	$ 17.18	275,076	$ 17.18	275,076	$ 17.18
Granted	-		-		-
Exercised	-		-		-
Forfeited	-		-		-
	---------		--------		---------
Outstanding at End of Year	275,076	$ 17.18	275,076	$ 17.18	275,076	$ 17.18
	======		=====		======
Options Exercisable at Year-end	176,507	$ 17.18	121,492	$ 17.18	66,477	$ 17.18
	======		=====		======

The following table summarizes information about fixed stock options outstanding at December 31, 2000:

	Options Outstanding			Options Exercisable
			Weighted-		Weighted-
	Number	Remaining	Average	Number	Average
Exercise	Outstanding	Contractual	Exercise	Exercisable	Exercise
Price	at 12/31/00	Life	Price	at 12/31/00	Price
$ 17.18	275,076	6.8 years	$ 17.18	176,507	$ 17.18

NOTE P

COMPREHENSIVE INCOME

Comprehensive income was comprised of changes in the Company’s unrealized holding gains or losses on securities available-for-sale during 2000, 1999 and 1998. The following represents the tax effects associated with the components of comprehensive income.

		Years Ended December 31,
			2000		1999		1998
Gross Unrealized Holding Gains (Losses)
	Arising During the Period	$	2,553	$	(3,577)	$	(120)
Tax (Expense) Benefit			(868)		1,216		41
			1,685		(2,361)		(79)
Reclassification Adjustment for (Gains)
	Losses Included in Net Income		283		20		(17)
Tax Expense (Benefit)			(96)		(7)		6
			187		13		(11)
Net Unrealized Holding Gains (Losses)
	Arising During the Period	$	1,872	$	(2,348)	$	(90)

NOTE Q

FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT OF 1991 (FDICIA) AND FINANCIAL INSTITUTIONS REFORM, RECOVERY AND ENFORCEMENT ACT OF 1989 (FIRREA)

FDICIA was signed into law on December 19, 1991. Regulations implementing the prompt corrective action provisions of FDICIA became effective on December 19, 1992. In addition to the prompt corrective action requirements, FDICIA includes significant changes to the legal and regulatory environment for insured depository institutions, including reductions in insurance coverage for certain kinds of deposits, increased supervision by the Federal regulatory agencies, increased reporting requirements for insured institutions, and new regulations concerning internal controls, accounting and operations.

FIRREA was signed into law on August 9, 1989. Regulations for savings institutions’ minimum capital requirements went into effect on December 7, 1989. In addition to its capital requirements, FIRREA includes provisions for changes in the Federal regulatory structure for institutions, including a new deposit insurance system and restricted investment activities with respect to noninvestment grade corporate debt and certain other investments. FIRREA also increases the required ratio of housing-related assets in order to qualify as a savings institution.

The regulations require institutions to have a minimum regulatory tangible capital equal to 1.5% of adjusted total assets, a minimum 3% core/leverage capital ratio, a minimum 4% tier 1 risk-based ratio, and a minimum 8% total risk-based capital ratio to be considered "adequately capitalized." An institution is deemed to be "critically undercapitalized" if it has a tangible equity ratio of 2% or less. The ability to include qualifying supervisory goodwill for purposes of the core/leverage capital and tangible capital was phased out by July 1, 1995.

The following table sets out the Association’s various regulatory capital categories at December 31, 2000 and 1999.

	2000		1999
	Dollars	Percentage	Dollars	Percentage
	(Thousands)		(Thousands)
Tangible Capital	$24,199	16.22%	$27,570	17.68%
Tangible Equity	$24,199	16.22%	$27,570	17.68%
Core/Leverage Capital	$24,199	16.22%	$27,570	17.68%
Tier 1 Risk-Based Capital	$24,199	38.87%	$27,570	48.40%
Total Risk-Based Capital	$24,619	39.54%	$27,994	49.15%

As of December 31, 2000, the most recent notification from the FDIC categorized the Association as "well capitalized" under the regulatory framework for prompt corrective action. To be "well capitalized", the Association must maintain minimum leverage capital ratios and minimum amounts of capital to "risk-weighted" assets, as defined by banking regulators.

NOTE R

REGULATORY CAPITAL

The following is a reconciliation of generally accepted accounting principles (GAAP) net income and capital to regulatory capital for the Association. The following reconciliation also compares the capital requirements as computed to the minimum capital requirements for the Association.

	Net Income for the Year Ended December 31, 2000	Capital as of December 31, 2000
Per GAAP	$1,096	$	25,492
	====		=====
Total Assets		$	151,175
			======
Capital Ratio			16.86%

			Tangible Capital		Tangible Equity		Core/ Leverage Equity		Tier 1 Risk-Based Capital		Total Risk-Based Capital
Per GAAP			$	25,492	$	25,492	$	25,492	$	25,492	$	25,492
	Assets Required
		to be Added:
		Unrealized Loss
		on Securities
		Available-for-Sale		(1,293)		(1,293)		(1,293)		(1,293)		(1,293)
	Allowance for Loan
		Losses		-		-		-		-		420
	Regulatory Capital
		Measure	$	24,199	$	24,199	$	24,199	$	24,199	$	24,619
				=====		=====		=====		=====		=====
	Adjusted Total Assets		$	149,217	$	149,217	$	149,217
				=====		=====		=====
									$	62,260	$	62,260
										=====		=====
	Risk-Weighted Assets
	Capital Ratio			16.22%		16.22%		16.22%		38.87%		39.54%
	Required Ratio			1.50%		2.00%		3.00%		4.00%		8.00%
	Required Capital		$	2,238			$	4,476			$	4,981
				=====				=====				=====
	Excess Capital		$	21,961			$	19,723			$	19,638
				=====				=====				=====

	Net Income for the Year Ended December 31, 1999	Capital as of December 31, 1999
Per GAAP	$1,244	$	27,007
	====		=====
Total Assets		$	155,057
			======
Capital Ratio			17.42%

Per GAAP			$	27,007	$	27,007	$	27,007	$	27,007	$	27,007
	Assets Required
		to be Added:
		Unrealized Loss
		on Securities
		Available-for-Sale		563		563		563		563		563
	Allowance for Loan
		Losses		-		-		-		-		424
	Regulatory Capital
		Measure	$	27,570	$	27,570	$	27,570	$	27,570	$	27,994
				=====		=====		=====		=====		=====
	Adjusted Total Assets		$	155,911	$	155,911	$	155,911
				=====		=====		=====
									$	56,958	$	56,958
										=====		=====
	Risk-Weighted Assets
	Capital Ratio			17.68%		17.68%		17.68%		48.40%		49.15%
	Required Ratio			1.50%		2.00%		3.00%		4.00%		8.00%
	Required Capital		$	2,339			$	4,677			$	4,557
				=====				=====				=====
	Excess Capital		$	25,231			$	22,893			$	23,437
				=====				=====				=====

NOTE S

COMMITMENTS AND CONTINGENCIES

In the normal course of business, the Association has various outstanding commitments and contingent liabilities that are not reflected in the accompanying financial statements.

COMMITMENTS TO EXTEND CREDIT

The Association is a party to credit related commitments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These consist of outstanding mortgage and construction loan commitments and commercial lines of credit. As of December 31, 2000 and 1999, outstanding mortgage and construction loan commitments were approximately $955,000 and $2,301,000, respectively. These commitments, normally extended for thirty days, are for first mortgage or construction loans at a fixed rate ranging from 6.75% to 9.00%.

EMPLOYMENT CONTRACTS

The chief executive officer and the executive vice-president of the Association serve under employment contracts that were approved by the Board of Directors on February 13, 1997. The contracts were amended on February 10, 2000, to increase the base salaries and extend the term thereof to February 13, 2003.

OPERATING LEASE

The Association leases an automobile under an operating lease that expires in July 2003. Total rent expense incurred under this lease amounted to $4,713, $-0-, and $-0-, for the years ended December 31, 2000, 1999, and 1998, respectively.

Future minimum rental payments are as follows:

Year Ending December 31,		Amount
2001	$	8,077
2002		8,077
2003		4,711
Total	$	20,865

NOTE T

FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

The Association is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments consist of commitments to extend credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the balance sheets.

The Association’s exposure to credit loss in the event of nonperformance by the other party to these financial instruments for commitments to extend credit is represented by the contractual notional amount of those instruments (see Note S). The Association uses the same credit policies making commitments as it does for on-balance sheet instruments.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amount does not necessarily represent future cash requirements. The Association evaluates each customer’s creditworthiness on a case-by-case basis. The amount and type of collateral obtained varies and is based on management’s credit evaluation of the counterparty.

NOTE U

CONCENTRATION OF CREDIT RISK

The Association’s lending activity is concentrated within the southeastern part of Louisiana. In accordance with industry practices, the Association has deposits in other financial institutions for more than the insured limit. These deposits in other institutions do not represent more than the normal industry credit risk.

NOTE V

DISCLOSURE ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate the value:

The carrying amount of cash and short-term investments approximate the fair value.

For investment securities, mortgage-backed securities, and collateralized mortgage obligations, fair value is based on quoted market prices.

For mortgage loan receivables the fair values are based on discounted cash flows using current rates at which similar loans with similar maturities would be made to borrowers with similar credit risk.

The fair value of savings deposits is calculated using average rates in the market place at the date of the financial statements.

For certificates of deposit, fair value is estimated based on current rates for deposits of similar remaining maturities.

The fair value of loan commitments is estimated using rates and fees that would be charged to enter similar agreements, taking into account (1) the remaining terms of the agreement, (2) the creditworthiness of the borrowers, and (3) for fixed rate commitments, the difference between current interest rates and committed rates.

Estimated fair values of the financial instruments are as follows (in thousands):

		December 31, 2000				December 31, 1999
		Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial Assets
	Cash and Short-Term Investments	$	3,403	$	3,403	$	2,504	$	2,504
	Investment Securities		11,000		11,000		10,483		10,483
	Mortgage-Backed Securities		4,115		4,115		16,275		16,275
	Collateral Mortgage Obligations		53,745		53,745		52,080		52,080
	Loans (Net of Loan Allowance)		74,480		73,674		70,066		68,284
Financial Liabilities
	Deposits	$	58,879	$	57,759	$	59,216	$	58,315
	Advances from Federal Home Loan Bank		54,191		52,425		53,988		51,809
Unrecognized Financial Instruments
	Commitments to Extend Credit	$	400	$	398	$	1,380	$	1,379
	Unfunded Construction Loan Commitments		554		533		921		926
	Unfunded Commercial Lines of Credit		1		1		-		-

NOTE W

SELECTED QUARTERLY FINANCIAL DATA (Unaudited)

The following sets forth condensed results of operations for 2000 and 1999 (dollar amounts in thousands, except per share data):

			First		Second		Third		Fourth
2000			Quarter		Quarter		Quarter		Quarter
Interest Income		$	2,798	$	2,822	$	2,848	$	2,794
Interest Expense			1,367		1,402		1,537		1,570
	Net Interest Income		1,431		1,420		1,311		1,224
Provision for Loan Losses			-		-		7		-
Other Income			(58)		(196)		292		(167)
Other Expense			835		868		864		823
Income Tax Expense			206		133		272		55
	Net Income	$	332	$	223	$	460	$	179
Net Income per Common Share (1)
	Basic	$	0.14	$	0.11	$	0.26	$	0.11
	Dilluted	$	0.14	$	0.11	$	0.26	$	0.11
Dividends Per Share		$	0.09	$	0.09	$	0.09	$	0.09
(1) Quarterly per share amounts do not add to total for the year ended due to rounding.
			First		Second		Third		Fourth
1999			Quarter		Quarter		Quarter		Quarter
Interest Income		$	2,590	$	2,508	$	2,710	$	2,850
Interest Expense			1,237		1,212		1,363		1,409
	Net Interest Income		1,353		1,296		1,347		1,441
Provision for Loan Losses			-		-		-		6
Other Income			(3)		(8)		5		1
Other Expense			802		818		802		879
Income Tax Expense			200		161		130		259
	Net Income	$	348	$	309	$	420	$	298
Net Income per Common Share (1)
	Basic	$	0.13	$	0.13	$	0.18	$	0.13
	Dilluted	$	0.13	$	0.13	$	0.18	$	0.13
Dividends Per Share		$	0.07	$	0.09	$	0.09	$	0.09
(1) Quarterly per share amounts do not add to total for the year ended due to rounding.

NOTE X

EARNINGS PER COMMON SHARE

Earnings per share are computed using the weighted average number of shares outstanding. Options to purchase 275,076 shares at $17.18 per share were outstanding during 2000, 1999, and 1998 but were not included in the computation of diluted earnings per share because the options’ exercise price was greater than the average market value price of the common shares. The options were still outstanding at December 31, 2000. The Company had no other securities outstanding during the years ended December 31, 2000, 1999, or 1998 that would have a dilutive effect on earnings per share.

Average shares outstanding at December 31, 2000, 1999 and 1998 amounted to 1,976,605, 2,383,168, and 2,793,247 respectively.

NOTE Y

CONDENSED FINANCIAL INFORMATION - PARENT COMPANY ONLY

GS FINANCIAL CORP.
CONDENSED FINANCIAL CONDITION
(Dollars in Thousands)
ASSETS
		December 31,
		2000		1999
Cash and Cash Equivalents	$	254	$	570
Investments - Available-for-Sale, at Fair Value		238		309
Mortgage-Backed Securities - Available-for-Sale, at Fair Value		1,545		1,772
Investment in Subsidiary		25,492		27,007
Loan Receivable		1,947		2,193
Dividend Receivable from Subsidiary		8,035		11,370
Deferred Tax Asset		-		5
Other Assets		468		501
	$	37,979	$	43,727
		====		====
LIABILITIES AND STOCKHOLDERS' EQUITY
Deferred Tax Liability	$	5	$	-
Accrued Income tax		-		1
Stockholders' Equity		37,974		43,726
	$	37,979		43,727
		====		====

GS FINANCIAL CORP.
STATEMENT OF OPERATIONS
(Dollars in Thousands)
				For the Years Ended
				December 31,
				2000		1999		1998
INTEREST INCOME
	Mortgage-Backed Securities		$	128	$	147	$	291
	Dividend from Subsidiary			5,000		250		-
	Loans			173		192		210
	Investment Securities			19		63		327
	Other Interest Income			39		27		26
		Total Interest Income		5,359		679		854
NON-INTEREST INCOME
	Undistributed Earnings of Subsidiary			(3,904)		994		1,161
	Gain on sale of Mortgage-Backed Securities			-		-		87
	Income from Real Estate Held-for-Investment			-		2		17
		Total Non-Interest Income		(3,904)		996		1,265
NON-INTEREST EXPENSES
	General and Administrative			59		68		129
	Intercompany Personnel Expense			116		110		106
	Taxes			20		34		60
	Loss on Sale of Investments			10		13		31
	Bank Acquisition Costs Charged Off			-		-		42
		Total Non-Interest Expenses		205		225		368
INCOME BEFORE INCOME TAX				1,250		1,450		1,751
PROVISION FOR INCOME TAX				55		75		217
NET INCOME			$	1,195	$	1,375	$	1,534

GS FINANCIAL CORP.
STATEMENT OF CASH FLOWS
(Dollars in Thousands)
						For the Years Ended
						December 31,
						2000		1999		1998
OPERATING ACTIVITIES
	Net Income				$	1,195	$	1,375	$	1,534
	Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities
		Depreciation Expense				3		4		3
			Loss on Sale of Investments			10		13		31
			Gain on Mortgage-Backed Securities			-		-		(87)
			Equity in Undistributed Earnings of Subsidiary			3,904		(994)		(1,161)
			Amortization of Investment Premium			4		13		32
			Dividend on IMF Fund			(11)		(23)		(10)
			Dividend on ARM Fund			(8)		(40)		(316)
			Decrease in Accrued Interest Receivable			2		4		34
			Decrease in Dividend Receivable from Subsidiary			3,335		-		-
			Decrease in Tax Receivable			47		15		-
			Deferred Income Tax			10		-		90
			(Increase) Decrease in Other Assets			(8)		2		(67)
			(Decrease) Increase in Accrued Income Tax			(1)		(91)		57
				Net Cash Provided by Operating Activities		8,482		278		140
INVESTING ACTIVITIES
	Redemption (Purchase) of IMF Mutual Fund					200		536		(744)
	Investment (Redemption) in ARM Mutual Fund					(60)		2,809		4,445
	Sale of Mortgage-Backed Securities					-		-		4,181
	Investment in Other Equity Securities					(50)		-		-
	Principal Paydowns Note Receivable GS Financial ESOP					238		215		-
	Principal Paydowns on Mortgage-Backed Securities -
		Available-for-Sale				227		607		1,832
	Investment in Real Estate					-		-		(453)
				Net Cash Provided by Investing Activities		555		4,167		9,261
FINANCING ACTIVITIES
	Purchase of Treasury Stock					(8,590)		(3,654)		(8,324)
	Payment of Dividends					(763)		(846)		(822)
				Net Cash (Used in) Financing Activities		(9,353)		(4,500)		(9,146)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS						(316)		(55)		255
CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR						570		625		370
CASH AND CASH EQUIVALENTS - END OF YEAR					$	254	$	570	$	625

 Part IV.

Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON

FORM 8-K.

Item 14 of the Form 10-K is hereby amended and restated in its entirety to read as follows:

(a) Documents filed as part of this Report.

(1)	The following financial statements are incorporated by
		reference from Item 8:
			Report of Independent Auditors
			Consolidated Balance Sheets as of December 31, 2000 and 1999
			Consolidated Statements of Income for the Fiscal Periods
				Ended December 31, 2000, 1999 and 1998
			Consolidated Statements of Changes in Shareholders’ Equity for
				the Fiscal Periods Ended December 31, 2000, 1999 and 1998
			Consolidated Statements of Cash Flows for the Fiscal Periods
				Ended December 31, 2000, 1999 and 1998
			Notes to Consolidated Financial Statements

(2)	All schedules for which provision is made in the applicable
		accounting regulation of the SEC are omitted because of the absence of conditions under which they are required or because the required information is included in the consolidated financial statements and related notes thereto.

(3)	The following exhibits are filed as part of this form 10-K/A, and this
		list includes the Exhibit Index.

  Exhibit Index

3.1*	Articles of Incorporation of GS Financial Corp.
3.2*	Bylaws of GS Financial Corp.
4.1*	Stock Certificate of GS Financial Corp.
10.1**	GS Financial Corp. Stock Option Plan
10.2**	GS Financial Corp. Recognition and Retention Plan and Trust
.		Agreement for Employees and Non-Employee Directors
10.3*	Employment Agreement among GS Financial Corp. Guaranty Savings and
		Homestead Association and Donald C. Scott Dated February 13, 1997
10.4*	Employment Agreement among GS Financial Corp. Guaranty Savings and Homestead Association and Bruce A. Scott Dated February 13, 1997
13.0***	2000 Annual Report to Stockholders
21.0	Subsidiaries of the Registrant - Reference is made to
		"Item 1" Business for the required information

* Incorporated herein by reference from the Registration Statement on Form SB-2 (Registration number 333-18841) filed by the Registrant with the SEC on December 26, 1996, as subsequently amended.

** Incorporated herein by reference from the definitive proxy statement, dated September 16, 1997, filed by the Registrant with the SEC (Commission File No. 000-22269)

*** Previously filed.

 SIGNATURE

Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the Registrant has duly caused this amended report to be signed on its behalf by the undersigned, thereunto duly authorized.

GS FINANCIAL CORP.

May 16, 2001 By: /s/ Donald C. Scott
-------------------------------
Donald C. Scott
Chairman of the Board, President
And Chief Executive Officer