Charter Financial 8-K Financial statements and exhibits

Exhibit 99.1

News Release

FOR IMMEDIATE RELEASE

Contact:	At The Investor Relations Company:
Robert L. Johnson, President & CEO	Karl Plath or Woody Wallace
706-645-1391	847-296-4200
bjohnson@charterbank.net	kplath@tirc.com orwwallace@tirc.com

CHARTER FINANCIAL Q2 EARNINGS INCREASE

• Substantial Gains Reported In Net Interest Income, Noninterest Income

• Noninterest Expense Decreases

• $592,000 Gain On Sale Of Freddie Mac Shares Helps Fuel Increase

WEST POINT, Georgia, April 27, 2004—Charter Financial Corporation (NASDAQ: CHFN) today reported that second-quarter net income rose to $2.2 million, or $0.11 per share, compared with $164,000, or $0.01 per share, a year earlier. Net income also improved from $1.7 million, or $.09 per share, for the quarter ended December 31, 2003. Net income for the six months ended March 31, 2004, was $3.9 million, or $.20 per share, compared to $663,000 or $.03 per share, for the prior-year period.

“We continued to build our retail franchise,” said Robert L. Johnson, president and chief executive officer. “Our loans and retail deposits both increased over the December 2003 quarter with loan balances up $3.7 million and retail deposit balances up by $9.5 million. Deposit fees for the quarter increased by $110,000 or 19 percent over the December 2003 quarter. “

Net income increased due to significant increases in net interest income and noninterest income. Net interest income increased $243,000 for the quarter ended March 31, 2004 as compared to the quarter ended December 31, 2003 quarter due to lower deposit and borrowing costs and an increase of $182,000 in dividends received from Freddie Mac, as Freddie Mac increased its quarterly dividend by four cents per share.

Noninterest income increased $297,000 compared to the quarter ended December 31, 2003. This increase was due to the $110,000 increase in deposit fees, a $68,000 increase in the gain on sale of loans, and a $51,000 increase in the gain on the sale of mortgage securities.

Noninterest expense was down $117,000 from the quarter ended December 31, 2003. Compensation, occupancy and professional services contributed to this reduction in noninterest expense.

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Income tax expense was up $197,000 compared to the quarter ended December 31, 2003 primarily due to higher pretax income. The effective tax rate was 26.0 percent this quarter versus 25.2 percent December quarter.

“We continue to actively manage our capital position and Freddie Mac common stock portfolio,” Johnson said. “During the second quarter, we recognized a pretax gain of $592,000 on the sale of 10,000 Freddie Mac shares to the option holders exercising at a strike price of $60 per share. We also earned $81,000 from writing the call options.”

In fiscal 2003, Charter Financial initiated a pilot program of writing covered call options on 250,000 shares of its Freddie Mac common stock to enhance the yield on its Freddie Mac stock portfolio. The price of Freddie Mac stock declined late in the quarter and as a result the Company wrote fewer calls rather than accepting either lower strike prices or lower premiums on call options. On a consolidated basis, Charter Financial owns 4.62 million shares of Freddie Mac common stock with a pre-tax unrealized gain of approximately $266.6 million at March 31, 2004.

“We were pleased that we were able to create value for our shareholders through our special dividend of twenty cents per share paid in March,” Johnson said. “We also continue to work at more effectively utilizing our capital through our retail expansion.”

Capital remains very strong with equity at $252.9 million, or 24.90 percent of total assets. Book value per share increased to $13.02 from $12.81 at December 31, 2003, primarily due to the increase in accumulated other comprehensive income, with the increase attributable to the increase in the fair value of Freddie Mac’s common stock from $58.32 per share at December 31, 2003 to $59.06 per share at March 31, 2004. CharterBank’s core capital was 9.37 percent at March 31, 2004.

At March 31, 2004, the Company had assets of $1.0 billion, down $14.8 million from December 31, 2003. Net loans outstanding were $303.4 million, up $3.7 million from December 2003. Retail deposits were $232.9 million and core deposits were $117.6 million at March 31, 2004 compared to $223.4 million and $99.6 million, respectively, at December 31, 2003. Total equity was $252.9 million at March 31, 2004 compared to $248.7 million at December 31, 2003.

Charter Financial Corporation is a savings and loan holding company and the parent company of CharterBank, a full-service community bank and a federal savings institution. In October 2001, Charter Financial Corporation and subsidiary CharterBank completed reorganization into a mutual holding company structure and the related initial public offering of the Company’s common stock. CharterBank is headquartered in West Point, Georgia, and operates eight full-service branches on the I-85 corridor from LaGrange, Georgia, to Auburn, Alabama. CharterBank’s deposits are insured by the Federal Deposit Insurance Corporation.

Forward-Looking Statements

This release may contain “forward-looking statements” that may be identified by use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated,” and “potential.” Examples of forward-looking statements include, but are not limited to, estimates with respect to our financial condition and results of operation and business that are subject to various factors that could cause actual results to differ materially from these estimates. These factors include but are not limited to general and local economic conditions; changes in interest rates, deposit flows, demand for mortgages and other loans, real estate values, and competition; changes in accounting principles, policies, or guidelines; changes in legislation or regulation; and other economic, competitive, governmental, regulatory, and technological factors affecting our operations, pricing, products, and services. Any or all forward-looking statements in this release and in any other public statements we make may turn out to be wrong. They can be affected by

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inaccurate assumptions we might make or known or unknown risks and uncertainties. Consequently, no forward-looking statements can be guaranteed. The Company disclaims any obligation to subsequently revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

Selected Financial Data

(in thousands except share data):

	At March 31, 2004		At December 31, 2003		At September 30, 2003
	Unaudited
Total Assets	$	1,015,957	$	1,030,716	$	1,000,495
Loans Receivable, net		303,446		299,708		292,553
Mortgage Securities Available for Sale		374,084		409,454		394,432
Freddie Mac Common Stock		272,887		270,051		242,904
Other Investment Securities		20,375		3,938		21,629
Retail Deposits		232,870		223,413		229,649
Core Deposits		117,566		99,555		99,546
Total Deposits		291,001		271,319		279,386
Deferred Income Taxes		100,859		99,109		88,196
Borrowings		358,167		399,242		388,441
Realized Stockholders’ Equity*		88,856		87,444		86,419
Accumulated Other Comprehensive Income**		164,082		161,299		143,940
Total Equity		252,938		248,743		230,359
Book Value per Share	$	13.02	$	12.81	$	11.87
Tangible Book Value per Share		12.71		12.49		11.55
Minority Shares Outstanding		3,569,850		3,569,850		3,552,050
Total Shares Outstanding		19,427,774		19,426,974		19,409,974
Weighted Average Total Shares Outstanding – Basic		19,418,770		19,410,159		19,478,388
Weighted Average Total Shares Outstanding – Fully Diluted		19,457,071		19,436,341		19,482,326

* Includes Total Stockholders’ Equity less Accumulated Other Comprehensive Income.

** Includes unrealized gains and losses on Freddie Mac common stock and other investment securities adjusted for income taxes at a tax rate of 38.6%

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Selected Operating Data

(in thousands except share data):

	Three Months Ended						Six Months Ended March 31,
	March 31,				December 31, 2003
	2004		2003				2004		2003
	Unaudited
Total Interest Income	$	9,443	$	8,384	$	9,469	$	18,912	$	16,967
Total Interest Expense		4,023		4,712		4,293		8,317		9,733
Net Interest Income		5,420		3,672		5,176		10,595		7,234
Provision for Loan Losses		—		—		30		30		—
Net Interest Income after Provision for Loan Losses		5,420		3,672		5,146		10,565		7,234
Noninterest Income		1,844		1,128		1,547		3,391		2,303
Noninterest Expense		4,283		4,600		4,399		8,682		8,773
Income before Income Taxes		2,981		200		2,294		5,274		764
Income Tax Expense		775		36		578		1,353		101
Net Income	$	2,206	$	164	$	1,716	$	3,921	$	663
Earnings per Share	$	0.11	$	0.01	$	0.09	$	0.20	$	0.03
Earnings per Share – Fully Diluted		0.11		0.01		0.09		0.20		0.03
Cash Dividends per Share***		0.40		0.10		0.20		0.60		0.20
Net Charge-offs		222		66		67		290		55
Deposit Fees		673		356		563		1,235		758
Gain on Sale of Loans		310		643		242		552		1,232
Gain on Sale of Freddie Mac Common Stock		592		—		533		1,125		—
Gain on Covered Calls Related to Freddie Mac Common Stock		81		—		59		140		—

*** First Charter, MHC has waived its portion of these dividends, resulting in payment only to the minority stockholders.

Performance Ratios:

	Three Months Ended						Six Months Ended March 31,
	March 31,				December 31, 2003
	2004		2003				2004		2003
					Unaudited
Return on Equity	3.46	%	0.26	%	2.91	%	3.20	%	0.53	%
Return on Assets	0.85		0.07		0.67		0.76		0.14
Net Interest Margin	2.13		1.56		2.07		2.10		1.53
Loan Loss Reserve as a % of Nonperforming Assets	103.46		147.81		101.82		103.46		147.81
Nonperforming Assets as a % of Total Loans and REO	2.02		1.79		2.18		2.02		1.79
Net Chargeoffs as a % of Total Loans	0.07		0.02		0.02		0.09		0.02
Nonperforming Assets to Total Assets	0.62		0.51		0.64		0.62		0.51
Bank Core Capital Ratio	9.38		9.38		8.89		9.38		9.38
Dividend Payout Ratio	61.27		222.90		40.21		52.06		110.49

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