Hopfed Bancorp (HFBC) 8-K Hopfed Bancorp, Inc. Reports Growth In Net Income

Exhibit 99.1

NEWS

FOR IMMEDIATE RELEASE	CONTACT:	John E. Peck
		President and CEO
		(270)885-1171

HOPFED BANCORP, INC. REPORTS GROWTH IN NET INCOME

AND LOANS FOR THIRD QUARTER

Net Income Up 93.4% Year-over-Year to $3.5 Million

Net Loans Increase 7.6% Year-over-Year to $630.2 Million

HOPKINSVILLE, Ky. (October 25, 2017) – HopFed Bancorp, Inc. (NASDAQ: HFBC) (the “Company”), the holding company for Heritage Bank USA, Inc. (the “Bank”), today reported growth in net income and loans for the three and nine month periods ended September 30, 2017. For the three month period ended September 30, 2017, net income rose 42.4% to $1.4 million, or $0.22 per share, compared to $985,000, or $0.16 per share, for the three month period ended September 30, 2016. For the nine month period ended September 30, 2017, net income rose 93.4% to $3.5 million, or $0.56 per share, compared to $1.8 million, or $0.29 per share, for the nine month period ended September 30, 2016.

Commenting on the third quarter results, John E. Peck, President and Chief Executive Officer, said, “At September 30, 2017, loans rose 7.6% to $630.2 million and deposits were up 2.7% to $731.2 million compared to September 30, 2016. HopFed’s positive trend of earnings growth continues into the third quarter of 2017 as a result of the growth in the average balance of loans and careful management ofnon-interest expenses. We are confident that our continued success in providing quality service and value to our communities will translate into improved financial performance.”

Financial Highlights

• Loans receivable rose 7.6% to $630.2 million at September 30, 2017, compared to $586.3 million at September 30, 2016. Loan growth benefited from solid production from the Company’s loan production office in Nashville, Tennessee. At September 30, 2017, total loans originated and outstanding in the Nashville loan production office were $63.2 million compared to $39.5 million at September 30, 2016.

• The Company continues to experience a reduction in the level ofnon-accrual and problem loans.Non-accrual loans declined from $11.7 million, or 1.99% of total loans, at September 30, 2016, to $1.7 million, or 0.28% of total loans, at September 30, 2017. Loans classified as impaired were $31.9 million at September 30, 2016 and $11.2 million at September 30, 2017.

• The Company continued to repurchase its common stock as part of the Board approved stock repurchase program. For the nine month period ended September 30, 2017, the Company purchased 41,321 shares of its common stock at a weighted average price of $14.14 per share. At September 30, 2017, the Company held 1,287,457 shares in treasury stock with a weighted average cost of $12.37 per share. The Company may purchase an additional 51,229 additional shares of treasury stock under its current repurchase program.

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HFBC Reports Third Quarter Results

Page 2

October 25, 2017

Results of Operations

In the three and nine month periods ended September 30, 2017, net interest income was $7.1 million and $20.8 million, respectively, as compared to $6.7 million and $19.8 million for the three and nine month periods ended September 30, 2016. The improved level of net interest income is the result of the growth in the average balances of loans. For the three month period ended September 30, 2017, the average balance of net loans outstanding was $637.0 million, an increase of $61.9 million compared to the three month period ended September 30, 2016. For the nine month period ended September 30, 2017, the average balance of net loans outstanding was $626.1 million, an increase of $63.3 million as compared to the nine month period ended September 30, 2017. During the three and nine month periods ended September 30, 2017, total interest earning assets have increased by $39.1 million and $34.5 million, respectively. The Company has utilized cash on hand and the cash flow provided by our securities portfolio to fund a meaningful portion of our loan growth.

The improvement in net interest income for the three and nine months ended September 30, 2017 is partially offset by the higher cost of interest bearing liabilities. The total cost of all interest bearing liabilities for the three and nine month periods ended September 30, 2017 is 0.89% and 0.85%, respectively, compared to 0.80% for the three and nine month periods ended September 30, 2016. For the three and nine month periods ended September 30, 2017, the Company’s net interest margin was 3.43% and 3.37%, respectively, compared to 3.41% and 3.36% for the three and nine month periods ended September 30, 2016, respectively.

In the three and nine month periods ended September 30, 2017, the Company has experienced a reduction of both consumer and municipal checking account balances. At September 30, 2017 and December 31, 2016, totalnon-interest bearing checking account balances were $128.2 million and $136.3 million, representing a decline of $8.1 million. At September 30, 2017 and December 31, 2016, total interest bearing checking account balances were $196.3 million and $209.3 million, representing a decline of $13.0 million. For the nine month period ended September 30, 2017, short term interest rates have increased. Coupled with the competitive nature of select local markets, the Company anticipates continued increases in the cost of funding our loan growth.

For the nine month periods ended September 30, 2017 and September 30, 2016, the Company’snon-interest income was $6.2 million and $5.9 million, respectively. The improved levels ofnon-interest income is partially attributable to changes made to the Company’s checking account offerings in December of 2016. In the nine month period ended September 30, 2017, the Company has increased fee income on deposit accounts by $329,000 compared to the nine month period ended September 30, 2016. The new checking account product offerings reduces, but does not eliminate, the number of checking accounts not subject to a monthly fee. However, the Company’s new deposit product offerings added several valuable features for customers such as roadside assistance, cell phone insurance and discounts at many local businesses. For the nine month period ended September 30, 2017, other operating income was $877,000, an increase of $309,000 compared to the nine month period ended September 30, 2016. The increase in other operating income was largely due to aone-time payment from a vendor of $225,000.

For the three and nine month periods ended September 30, 2017, totalnon-interest expenses were $7.2 million and $22.1 million, respectively compared to $7.4 million and $22.6 million for the three and nine month periods ended September 30, 2016, respectively. In the three and nine month periods ended September 30, 2017, the Company’s net foreclosure expenses have declined by $229,000 and $384,000, respectively, compared to the three and nine month periods ended September 30, 2016. For the three and nine month periods ended September 30, 2017, the Company’s salaries and benefits expense was $3.9 million and $12.1 million, respectively. This represents an increase of $162,000 and $486,000, respectively, compared to the three and nine month periods ended September 30, 2016. The Company’s cost of providing health insurance benefits to employees increased by $86,000 and $267,000 in the three and nine month periods ended September 30, 2017 compared to the three and six month periods ended September 30, 2016.

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HFBC Reports Third Quarter Results

Page 3

October 25, 2017

Balance Sheet

At September 30, 2017, total assets were $904.1 million, compared to $891.5 million at December 31, 2016 and $871.9 million at September 30, 2016. Management continues to strive to growth both sides of the Company’s balance sheet at approximately the same pace to maximize our interest rate margin and profitability. The Company’s loan growth has been focused on commercial and residential real estate. The Company continues to utilize the cash from the investment portfolio to supplement liquidity for loan growth. The Company is managing deposit growth to limit the increased cost necessary to attract new deposits while seeking to grow our deposit base at a rate commensurate with our loan demand. In the nine month period ended September 30, 2017, deposit growth has been dependent on time deposit and brokered deposits due to the decline in balances held in both interest bearing andnon-interest bearing checking accounts. A summary of loans outstanding by type at September 30, 2017, December 31, 2016 and September 30, 2016 is as follows:

	9/30/2017			12/31/2016			9/30/2016
	(Dollars in Thousands)
One-to-four family first mortgages	$	167,088			147,962			145,197
Home equity lines of credit		34,995			35,684			34,563
Junior liens		1,402			1,452			1,601
Multi-family		37,321			34,284			32,418
Construction		25,594			39,255			37,775
Land		14,289			23,840			22,999
Farmland		37,262			47,796			46,877
Non-residential real estate		216,056			182,940			170,759
Consumer		8,060			8,717			8,908
Commercial		88,515			88,907			83,684
Total loans, gross		630,582			610,837			586,328
Deferred loan cost, net of fees		(380	)		(439	)		(453	)
Allowance for loan loss		(4,799	)		(6,122	)		(6,812	)
Total loans, net		625,403			604,276			579,063

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HFBC Reports Third Quarter Results

Page 4

October 25, 2017

Asset Quality

In the three month period ended September 30, 2017, the Company foreclosed on its largest problem loan, a $6.7 million lending relationship that included a residential property, two small developed commercial lots and a 67 acre tract of undeveloped land. In September 2017, the Company recognized a $2.6 millioncharge-off and has listed these properties for sale. For the nine month period ended September 30, 2017, the Company’s net charge-offs totaled $1.7 million for an annualized net charge off ratio of 0.37%.

As a result of improved financial performance of several borrowers and the foreclosure of our largestnon-accrual loan, the Company’snon-accrual loans fell to $1.7 million, or 0.28% of total loans at September 30, 2017 compared to $11.7 million, or 1.99% of total loans, at September 30, 2016 and $9.1 million, or 1.49% of total loans, at December 31, 2016. The Company’s level of impaired loans declined from $31.9 million at September 30, 2016 to $11.2 million at September 30, 2017. The table below provides a history of the Company’s significant credit quality metrics:

	9/30/2017			6/30/2017			3/31/2017			12/31/2016			9/30/2016
	(Dollars in Thousands, Except Percentages)
Loans past due30-89 days		754			2,910			746			1,211			586
Loans past due 90 + days accruing interest		—			—			—			—			—
Totalnon-accrual loans		1,739			8,579			8,944			9,074			11,664
Total loans classified as substandard		11,217			24,808			26,345			29,339			31,927
Troubled debt restructuring—performing		3,371			3,388			4,237			6,461			6,503
Total foreclosed assets		4,975			1,408			2,111			2,397			741
Quarterly net charge offs		2,451			(956	)		238			765			(33	)
Non-accrual loans / Total loans		0.28	%		1.34	%		1.44	%		1.49	%		1.99	%
Non-performing assets / Total assets		0.74	%		1.09	%		1.20	%		1.29	%		1.42	%
Allowance for loan loss / Total loans		0.76	%		1.12	%		0.99	%		1.00	%		1.16	%
Allowance for loan loss /Non-accrual loans		275.96	%		83.69	%		68.92	%		67.36	%		58.40	%
Classified loans / Risk based capital		11.10	%		24.28	%		26.15	%		29.66	%		31.99	%

The Company

HopFed Bancorp, Inc. is the holding company for Heritage Bank USA, Inc. (“Heritage Bank”), a Kentucky state chartered commercial bank. Heritage Bank has eighteen offices in western Kentucky and middle Tennessee and loan production offices in Nashville, Tennessee and Brentwood, Tennessee. The Company offers a broad line of financial services and products with the personalized focus of a community banking organization. More information about HopFed Bancorp and Heritage Bank is located on its website www.bankwithheritage.com.

Forward-Looking Information

Information contained in this press release, other than historical information, may be consideredforward-looking in nature and is subject to various risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or expected. Among the key factors that may have a direct bearing on the Company’s operating results, performance or financial condition are competition and the demand for the Company’s products and services, and other factors as set forth in filings with the Securities and Exchange Commission. The Company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations. Certain tabular presentations may not reconcile because of rounding.

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HFBC Reports Third Quarter Results

Page 5

October 25, 2017

HOPFED BANCORP, INC.

Consolidated Condensed Balance Sheets

(Dollars in Thousands)

	09/30/17			06/30/17			03/31/17			12/31/16			09/30/16
	(unaudited)			(unaudited)			(unaudited)						(unaudited)
Assets
Cash and due from banks	$	23,469			20,208			30,663			21,779			24,741
Interest-earning deposits in banks		9,842			4,801			19,408			3,970			4,695
Cash and cash equivalents		33,311			25,009			50,071			25,749			29,436
Federal Home Loan Bank stock, at cost		4,428			4,428			4,428			4,428			4,428
Securities available for sale		192,287			205,363			207,580			209,480			213,289
Loans held for sale		1,749			2,386			1,091			1,094			1,547
Loans receivable		630,202			638,422			621,644			610,398			585,875
Allowance for loan losses		(4,799	)		(7,180	)		(6,164	)		(6,112	)		(6,812	)
Accrued interest receivable		3,414			3,332			3,121			3,799			3,603
Foreclosed assets		4,975			1,408			2,111			2,397			741
Bank owned life insurance		10,287			10,192			10,120			10,662			10,581
Premises and equipment, net		22,945			23,097			23,225			23,461			23,579
Deferred tax assets		2,292			3,025			2,918			3,052			2,144
Other assets		2,973			2,645			3,162			3,078			3,495
Total assets	$	904,064			912,127			923,307			891,486			871,906
Liabilities:
Deposits:
Non-interest-bearing accounts	$	128,184			132,305			136,333			131,145			130,327
Interest-bearing accounts
NOW accounts		196,315			216,256			217,562			209,347			182,360
Savings and money market accounts		97,929			98,270			100,009			99,312			98,929
Other time deposits		308,801			299,113			311,839			293,078			300,701
Total deposits		731,229			745,944			765,743			732,882			712,317
Advances from Federal Home Loan Bank		31,000			21,000			11,000			11,000			11,000
Repurchase agreements		37,829			41,820			45,492			47,655			44,465
Subordinated debentures		10,310			10,310			10,310			10,310			10,310
Accrued expenses and other liabilities		4,461			4,262			3,301			3,211			4,952
Total liabilities		814,829			823,336			835,846			805,058			783,044

This information is preliminary and based on company data available at the time of the presentation.

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HFBC Reports Third Quarter Results

Page 6

October 25, 2017

HOPFED BANCORP, INC.

Consolidated Condensed Balance Sheets, Continued

(Dollars in Thousands)

	09/30/17			06/30/17			03/31/17			12/31/16			09/30/16
	(unaudited)			(unaudited)			(unaudited)						(unaudited)
Stockholders’ equity:
Common stock, par value $.01		80			80			80			80			80
Additionalpaid-in-capital		58,777			58,750			58,705			58,660			58,658
Retained earnings		51,646			50,552			49,721			49,035			48,176
Treasury stock- common , at cost		(15,931	)		(15,361	)		(15,356	)		(15,347	)		(15,279	)
Unearned ESOP Shares, at cost		(6,125	)		(6,269	)		(6,414	)		(6,548	)		(6,756	)
Accumulated other comprehensive income, net of taxes		788			1,039			725			548			3,983
Total stockholders’ equity		89,235			88,791			87,461			86,428			88,862
Total liabilities and stockholders’ equity	$	904,064			912,127			923,307			891,486			871,906

Additional Capital Information

	09/30/17			06/30/17			03/31/17			12/31/16			9/30/2016
	(unaudited)			(unaudited)			(unaudited)						(unaudited)
Preferred stock authorized		500,000			500,000			500,000			500,000			500,000
Preferred stock outstanding		—			—			—			—			—
Common shares authorized		15,000,000			15,000,000			15,000,000			15,000,000			15,000,000
Common shares issued		7,976,131			7,964,076			7,963,378			7,963,378			7,963,378
Common shares outstanding		6,688,674			6,716,809			6,716,549			6,717,242			6,723,243
Treasury shares		1,287,457			1,247,267			1,246,829			1,246,136			1,240,135
Unearned ESOP shares		466,115			476,862			488,161			498,346			514,187
Book value per share (excludes unearned ESOP shares)	$	14.34		$	14.23		$	14.04		$	13.90		$	14.31
Tier 1 leverage ratio		10.9	%		10.4	%		10.6	%		10.8	%		10.9	%
Total risk based capital ratio		16.3	%		16.1	%		16.1	%		16.2	%		16.9	%
Common equity tier 1 capital ratio		15.6	%		15.0	%		15.1	%		15.2	%		15.8	%

This information is preliminary and based on company data available at the time of the presentation.

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HFBC Reports Third Quarter Results

Page 7

October 25, 2017

HOPFED BANCORP, INC.

Consolidated Condensed Quarterly Statements of Income

(Dollars in Thousands)

(Unaudited)

	For the three month periods ended										For the Nine Month Periods Ended September 30,
	09/30/17		09/30/16		06/30/17		03/31/17		12/31/16		2017		2016
Interest and dividend income:
Loans receivable		7,260		6,569		6,963		6,736		6,603		20,959		19,175
Investment in securities, taxable		1,124		1,099		1,155		1,118		1,051		3,397		3,544
Nontaxable securities available for sale		233		326		280		283		289		796		1,019
Interest-earning deposits		18		10		21		23		8		62		38
Total interest and dividend income		8,635		8,004		8,419		8,160		7,951		25,214		23,776
Interest expense:
Deposits		1,206		1,044		1,197		1,167		1,094		3,570		3,146
Advances from Federal Home Loan Bank		89		33		30		32		29		151		134
Repurchase agreements		130		139		119		103		87		352		421
Subordinated debentures		112		99		108		104		101		324		287
Total interest expense		1,537		1,315		1,454		1,406		1,311		4,397		3,988
Net interest income		7,098		6,689		6,965		6,754		6,640		20,817		19,788
Provision for loan losses		71		255		59		291		63		421		1,178
Net interest income after provision for loan losses		7,027		6,434		6,906		6,463		6,577		20,396		18,610
Non-interest income:
Service charges		819		719		800		804		694		2,423		2,094
Merchant card income		299		308		315		302		311		916		913
Mortgage origination revenue		335		415		278		334		367		947		1,218
Gain on sale of securities		162		79		14		2		190		178		422
Income from bank owned life insurance		95		104		72		235		78		402		265
Financial services commission		134		131		145		140		159		419		455
Other operating income		186		189		212		479		201		877		568
Totalnon-interest income		2,030		1,945		1,836		2,296		2,000		6,162		5,935

This information is preliminary and based on company data available at the time of the presentation.

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HFBC Reports Third Quarter Results

Page 8

October 25, 2017

HOPFED BANCORP, INC.

Consolidated Condensed Statements of Income, Continued

(Dollars in Thousands, Except Per Share Data)

(Unaudited)

	For the three month periods ended													For the Nine Month Periods Ended September 30,
	9/30/2017			9/30/2016			6/30/2017		3/31/2017		12/31/2016			2017		2016
Non-interest expenses:
Salaries and benefits		3,919			3,757			3,977		4,236		3,754			12,132		11,646
Occupancy		716			810			729		775		775			2,220		2,398
Data processing		795			744			546		764		767			2,105		2,175
State deposit tax		169			248			200		231		247			600		743
Professional services		409			368			464		348		396			1,221		1,008
Advertising		240			376			368		381		334			989		1,067
Foreclosure, net		(25	)		204			6		108		(51	)		89		473
(Gain) loss on sale of asset		—			(72	)		3		—		—			3		(72	)
Other operating expenses		945			918			940		846		989			2,731		3,207
Totalnon-interest expense		7,168			7,353			7,233		7,689		7,211			22,090		22,645
Income before income tax expense		1,889			1,026			1,509		1,070		1,366			4,468		1,900
Income tax expense		486			41			368		135		260			989		102
Net income		1,403			985			1,141		935		1,106			3,479		1,798
Net income per share
Basic	$	0.22		$	0.16		$	0.18	$	0.15	$	0.18		$	0.56	$	0.29
Diluted	$	0.22		$	0.16		$	0.18	$	0.15	$	0.18		$	0.56	$	0.29
Dividend per share	$	0.05		$	0.04		$	0.05	$	0.04	$	0.04		$	0.14	$	0.12

This information is preliminary and based on company data available at the time of the presentation.

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HFBC Reports Third Quarter Results

Page 9

October 25, 2017

HOPFED BANCORP, INC.

Selected Financial Data

(Dollars in Thousands, Except Percentages)

(Unaudited)

	Three month periods ended															Nine months ended
	9/30/2017			6/30/2017			3/31/2017			12/31/2016			9/30/2016			9/30/2017			9/30/2016
Average Balance Sheet Data
Loans, net of allowance		636,955			622,606			615,382			589,282			575,083			626,123			562,870
Available for sale taxable securities		173,624			177,260			176,824			179,483			185,812			175,891			194,657
Available for sale tax free securities		29,090			32,919			33,868			35,102			38,467			31,941			40,283
Other interest bearing deposits		4,351			5,888			9,260			5,915			5,517			6,490			8,168
Average earning assets		844,020			838,673			835,334			809,782			804,879			840,445			805,978
Averagenon-earning assets		64,913			70,359			75,527			70,443			69,248			69,001			74,212
Average assets		908,933			909,032			908,861			880,225			874,127			909,446			880,190
Average interest bearing deposits		612,655			628,583			625,104			596,763			585,212			622,068			595,889
Total average deposits		738,694			756,661			751,913			725,213			710,810			749,041			720,677
Repurchase agreements		37,978			39,138			41,840			41,717			46,282			39,638			44,186
FHLB borrowings		26,909			11,176			13,433			11,000			14,022			17,222			12,876
Subordinated debentures		10,310			10,310			10,310			10,310			10,310			10,310			10,310
Total average interest bearing liabilities		687,852			689,207			690,687			659,790			655,826			689,238			663,261
Averagenon-interest bearing deposits		126,039			128,078			126,809			128,450			125,598			126,973			124,788
Average othernon-interest bearing liabilities		5,628			3,915			3,993			3,557			3,781			5,374			3,501
Average total equity		89,214			87,832			87,372			88,428			88,922			87,861			88,640
	Three month periods ended															Nine months ended
Tax equivalent yield / Cost of:	9/30/2017			6/30/2017			3/31/2017			12/31/2016			9/30/2016			9/30/2017			9/30/2016
Loans, fully tax equivalent		4.57	%		4.48	%		4.38	%		4.49	%		4.57	%		4.47	%		4.55	%
Available for sale taxable securities		2.59	%		2.61	%		2.53	%		2.34	%		2.37	%		2.58	%		2.43	%
Available for sale tax free securities, fully tax equivalent		4.78	%		5.09	%		5.00	%		4.93	%		5.07	%		4.97	%		5.05	%
Average yield on other interest bearing deposits		1.65	%		1.43	%		0.99	%		0.54	%		0.73	%		1.27	%		0.62	%
Yield on total interest earning assets		4.15	%		4.09	%		3.98	%		4.00	%		4.06	%		4.07	%		4.02	%
Cost of total average deposits		0.65	%		0.63	%		0.62	%		0.60	%		0.59	%		0.64	%		0.58	%
Cost of average total interest bearing liabilities		0.89	%		0.84	%		0.81	%		0.79	%		0.80	%		0.85	%		0.80	%
Fully tax equivalent interest rate spread		3.26	%		3.25	%		3.17	%		3.21	%		3.26	%		3.22	%		3.22	%
Fully tax equivalent net interest margin		3.43	%		3.39	%		3.31	%		3.35	%		3.41	%		3.37	%		3.36	%
Annualized return on average assets		0.62	%		0.50	%		0.41	%		0.50	%		0.45	%		0.51	%		0.27	%
Annualized return on average equity		6.29	%		5.20	%		4.28	%		5.00	%		4.43	%		5.28	%		2.70	%
Fully tax equivalent efficiency ratio		77.41	%		80.80	%		83.58	%		82.05	%		83.54	%		80.58	%		86.27	%

This information is preliminary and based on company data available at the time of the presentation.

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