Exhibit 99.1
FOR IMMEDIATE RELEASE
---------------------
October 20, 2006
GS Financial Corp. Announces Third Quarter Results
METAIRIE, La. -- GS Financial Corp. (NASDAQ: GSLA), the holding company of
Guaranty Savings Bank, (www.guarantysb.com), announced quarterly earnings of
$1,511,000, or $1.25 per share for the quarter ended September 30, 2006, up
554% from $231,000, or $.20 per share reported for the same period in 2005.
Diluted earnings per share for the third quarter of 2006 were $1.24. These
results include income from a reduction in the allowance for loan losses of
$2.0 million recorded due to improvements in asset quality as the economy in
the Bank's trade area rebounds and individual borrowers recover from the
impact of Hurricane Katrina. The reversal to the loan loss provision added
$1,307,000, or $1.08 per share, to after-tax net income for both the quarterly
and year-to-date results.
Net income for the first nine months of 2006 totaled $2,030,000, up 404% from
$403,000 reported for the same time period in 2005. Basic and diluted
earnings per share over the first nine months of 2006 were $1.67, up 391% from
$.34 in the first nine months of 2005. The reduction in the allowance for
loan losses added $1,307,000, or $1.08 per share, to after-tax net income for
the year-to-date results in 2006. The results for the first nine months of
2005 include the one-time recognition of costs associated with the retirement
of the Company's former President and Chief Executive Officer. These costs
totaled $428,000, or $.36 per share ($282,000, or $.24 per share, after
related tax benefits). Excluding the impact of both of these one-time charges
and recoveries, net earnings from operations for the nine months ended
September 30, 2006 and 2005 were $725,000, or $.60 per share and $685,000, or
$.58 per share, respectively.
Net interest income for the quarter ended September 30, 2006 was $1.5 million,
up approximately $99,000, or 7% from the third quarter of 2005, and down 4%,
or $74,000 from the second quarter of 2006. The third quarter 2006 net
interest margin was 3.61%, up 41 basis points from 3.20% from the third
quarter of 2005, and down 19 basis points from 3.80% in the second quarter of
2006.
Net interest income for the first nine months of 2006 was $4.7 million, up 9%
from $4.3 million in the first nine months of 2005. The net interest margin
for the first nine months of 2006 was 3.63%, up 53 basis points from 3.10% for
the same time period in 2005.
Additional financial information includes the following:
* Total assets at September 30, 2006 were $172.4 million, down
approximately 3% from December 31, 2005.
* Loans, net at September 30, 2006 were $89.9 million, up approximately
29% from December 31, 2005.
* Deposits at September 30, 2006 were $126.2 million, up approximately
6% from December 31, 2005.
* Outstanding advances from the Federal Home Loan Bank at September 30,
2006 were $18.4 million, down approximately 43% from December 31, 2005.
* Stockholders' equity at September 30, 2006 was $27.0 million, up
approximately 6% from December 31, 2005. Stockholders' equity as a
percentage of total assets at September 30, 2006 was 15.67%, up from
14.30% at December 31, 2005.
* Non-interest expense for the third quarter of 2006 totaled $1.3
million, up approximately 29% from the year earlier period.
Non-interest expense for the first nine months of 2006 totaled $3.6
million, up less than 1% from the first nine months of 2005. Included
in the first nine months of 2005 are the previously mentioned expenses
associated with the retirement of the Company's former President and
Chief Executive Officer. Excluding the impact of this one-time charge,
non-interest expenses for the first nine months of 2005 would have been
$3.1 million, approximately 14% less than the current year.
* Non-performing assets were $499,000 at September 30, 2006, compared
to $3,582,000 at December 31, 2005. The ratio of non-performing
assets to total assets at September 30, 2006 was .29% compared to
2.01% at December 31, 2005.
* Reserve coverage of non-performing assets at September 30, 2006 was
748% compared to 160% at December 31, 2005. Reserve coverage of total
loans was 3.98% at September 30, 2006 compared to 7.58% at December 31,
2005.
* The ratio of loans to deposits at September 30, 2006 was 74.28%,
compared to 63.34% at December 31, 2005.
FORWARD-LOOKING INFORMATION
Statements contained in this news release which are not historical facts may be
forward-looking statements as that term is defined in the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements are subject to
risks and uncertainties which could cause actual results to differ materially
from those currently anticipated due to a number of factors. Factors which
could result in material variations include, but are not limited to, changes in
interest rates which could affect net interest margins and net interest income,
competitive factors which could affect net interest income and noninterest
income, changes in demand for loans, deposits and other financial services in
the Company's market area; changes in asset quality, general economic conditions
as well as other factors discussed in documents filed by the Company with the
Securities and Exchange Commission from time to time. In addition to risks and
uncertainties described by the Company in prior filings with the SEC, other
risks and uncertainties potentially impacting the Company are those related to
the Company in its primary market area impacted by Hurricane Katrina, including
the continuing effect of the storm and its aftermath on the Company's operating
expenses and on the Company's borrowers and other customers. The Company
undertakes no obligation to update these forward-looking statements to reflect
events or circumstances that occur after the date on which such statements were
made.
GS Financial Corp.
Condensed Consolidated Statements of Financial Condition
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9/30/2006 12/31/2005
($ in thousands) (Unaudited) (Audited)
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ASSETS
Cash & Amounts Due from Depository Institutions $ 2,013 $ 3,040
Interest-Bearing Deposits from Other Banks 7,232 4,515
Federal Funds Sold 2,810 15,000
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Total Cash and Cash Equivalents 12,055 22,555
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Securities Available-for-Sale, at Fair Value 62,209 77,344
Loans, Net 89,874 69,657
Accrued Interest Receivable 1,824 1,627
Premises & Equipment, Net 3,489 2,257
Stock in Federal Home Loan Bank, at Cost 1,364 1,833
Foreclosed Assets - -
Real Estate Held-for-Investment, Net 467 478
Other Assets 1,130 1,863
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Total Assets $ 172,412 $ 177,614
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LIABILITIES
Deposits
Interest-Bearing Deposits $ 123,555 $ 116,798
Noninterest-Bearing Deposits 2,597 2,195
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Total Deposits 126,152 118,993
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FHLB Advances 18,376 32,106
Other Liabilities 864 1,108
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Total Liabilities 145,393 152,207
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STOCKHOLDERS' EQUITY
Preferred Stock - $.01 Par Value $ - $ -
Common Stock - $.01 Par Value 34 34
Additional Paid-in Capital 34,724 34,565
Unearned ESOP Stock (100) (239)
Unearned RRP Trust Stock (697) (698)
Treasury Stock (32,493) (32,193)
Retained Earnings 25,922 24,136
Accumulated Other Comprehensive Loss (371) (198)
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Total Stockholders' Equity 27,019 25,407
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Total Liabilities & Stockholders' Equity $ 172,412 $ 177,614
Selected Asset Quality Data
Total Non Performing Assets $ 499 $ 3,582
Non Performing Assets to Total Assets 0.29% 2.01%
Allowance for Loan Losses to Non Performing Assets 747.89% 159.52%
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GS Financial Corp.
Condensed Consolidated Statements of Income
(Unaudited)
For the Three Months Ended For the Nine Months Ended
September 30, September 30,
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($ in thousands, except per share data) 2006 2005 2006 2005
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<s> <c> <c> <c> <c>
Interest and Dividend Income $ 2,800 $ 2,670(1) $ 8,294 $ 7,980(1)
Interest Expense 1,262 1,231 3,606 3,674
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Net Interest Income 1,538 1,439 4,688 4,306
Provision (reversal) for Loan Losses (1,981) - (1,981) -
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Net Interest Income after Provision
for Loan Losses 3,519 1,439 6,669 4,306
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Non-interest Expense 1,261 981 3,580 3,569
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Net Income Before Non-Interest Income
and Income Taxes 2,258 458 3,089 737
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Impairment Charge Related to Hurricane Katrina - (155) - (155)
Non-interest Income 31 39 (14) 71
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Income Before Tax Expense 2,289 342 3,075 653
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Income Tax Expense 778 111 1,045 250
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Net Income $ 1,511 $ 231 $ 2,030 $ 403
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Earnings Per Share - Basic $ 1.25 $ 0.20 $ 1.67 $ 0.34
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Earnings Per Share - Diluted $ 1.24 $ 0.20 $ 1.67 $ 0.34
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Selected Operating Data
Weighted Average Shares Outstanding 1,208,214 1,180,635 1,213,182 1,181,436
Return on Average Assets(2) 3.49% 0.50% 1.55% 0.28%
Non-Interest Expense/Average Assets(2) 2.93% 2.12% 2.73% 3.76%
Net Interest Margin(2) 3.61% 3.20% 3.63% 3.10%
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(1) Includes approximately $397,000 of interest accrued on loans but for which
payments had not been received as a result of loan deferrals granted in
the wake of Hurricane Katrina.
(2) Annualized
Contact
GS Financial Corp.
Stephen E. Wessel, Chief Executive Officer
J. Andrew Bower, Chief Financial Officer
(504) 457-6220