GS Financial Corp., (NASDAQ: GSLA), the holding company of Guaranty
Savings Bank (www.guarantysb.com), announced quarterly earnings of
$293,000 for the quarter ended June 30, 2007, up $50,000, or 20.6%
from the same period in 2006. Earnings per share for the second
quarter of 2007 were $.24, up from $.20 for the second quarter of
2006. The increase in earnings for the quarter ended June 30, 2007
was primarily due to a reversal of provision for loan losses of
$300,000, or $198,000 net of income taxes during the quarter. �We
continue to make progress in executing our strategic objectives,�
noted President Stephen E. Wessel. �Our residential and commercial
loan demand continues to be robust. Recovery from the devastation
of Hurricane Katrina is continuing to progress in some parts of our
metropolitan area. In the first six (6) months of 2007 we have
invested additional resources in new employees for mortgage
origination and in commercial banking. We have purchased a new
branch site to expand our presence to the west bank of Jefferson
Parish. Our renovation and reconstruction of our flooded mid-city
branch is nearly complete. We have also built a secondary marketing
capability which will generate long-term revenue, and have
introduced new products in mortgage banking, credit cards and
remote deposit. We have successfully grown some of our targeted
products such as demand deposit accounts, money market accounts and
home equity lending along with more commercial owner-occupied
building loans. These are significant steps in implementing the
long-term strategic plan adopted by the Board of Directors that
have increased our expenses during the six months but which we
expect will enhance our profitability through the conversion of
Guaranty Savings Bank from a traditional thrift to a community bank
business model.� For the first six months of 2007, net income
totaled $389,000, down 25.0% from $519,000 over the same time
period in 2006. Earnings per share over the first half of 2007 were
$.32, down 25.6% from $.43 in the first half of 2006. Net interest
income, excluding loan loss reserves, for the quarter ended June
30, 2007 was $1.4 million, down 14.0% from $1.6 million in the
second quarter of 2006, and up $21,000, or 1.5% from the first
quarter of 2007. The second quarter 2007 net interest margin was
3.50%, down 30 basis points from 3.80% for the second quarter of
2006, and up 2 basis points from 3.48% in the first quarter of
2007. Net interest income for the first half of 2007 was $2.8
million, down 12.5% from $3.2 million in the first six months of
2006. This decline was primarily the result of increases in deposit
costs only partially being offset by improved product mixes on both
the asset and liability side of the balance sheet. The net interest
margin for the first half of 2007 was 3.49%, down 16 basis points
from 3.65% for the same time period in 2006. Additional financial
highlights include the following: Total assets at June 30, 2007
were $169.9 million, up approximately 0.9% from December 31, 2006.
Total loans at June 30, 2007 were $108.9 million, up approximately
11.4% from December 31, 2006. Deposits at June 30, 2007 were $125.2
million, up approximately 2.4% from December 31, 2006. Outstanding
advances from the Federal Home Loan Bank at June 30, 2007 were
$16.8 million, down approximately 1.3% from December 31, 2006.
Stockholders� equity at June 30, 2007 was $27.0 million, down
$177,000 from December 31, 2006. Stockholders� equity as a
percentage of total assets at June 30, 2007 was 15.88%, down from
16.13% at December 31, 2006. Non-interest expense for the second
quarter of 2007 totaled $1.3 million, up approximately 10.7% from a
year earlier. Non-interest expense for the first half of 2007
totaled $2.6 million, up approximately 11.7% from the first six
months of 2006. Non-performing assets were $502,000 at June 30,
2007, compared to $179,000 at December 31, 2006. The ratio of
non-performing assets to total assets at June 30, 2007 was 0.30%
compared to 0.11% at December 31, 2006. The ratio of total loans to
deposits at June 30, 2007 was 86.98%, compared to 79.60% at
December 31, 2006. FORWARD-LOOKING INFORMATION Statements contained
in this news release which are not historical facts may be
forward-looking statements as that term is defined in the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements are subject to risks and uncertainties which could cause
actual results to differ materially from those currently
anticipated due to a number of factors. Factors which could result
in material variations include, but are not limited to, changes in
interest rates which could affect net interest margins and net
interest income, competitive factors which could affect net
interest income and noninterest income, changes in demand for
loans, deposits and other financial services in the Company's
market area; changes in asset quality, general economic conditions
as well as other factors discussed in documents filed by the
Company with the Securities and Exchange Commission from time to
time. In addition to risks and uncertainties described by the
Company in prior filings with the SEC, other risks and
uncertainties potentially impacting the Company are those related
to the Company in its primary market area impacted by Hurricane
Katrina, including the continuing effect of the storm and its
aftermath on the Company's operating expenses and on the Company's
borrowers and other customers. The Company undertakes no obligation
to update these forward-looking statements to reflect events or
circumstances that occur after the date on which such statements
were made. � GS Financial Corp. Condensed Consolidated Statements
of Financial Condition � � � � � ($ in thousands) � June 30, 2007
(Unaudited) � December 31, 2006 (Audited) ASSETS Cash & Amounts
Due from Depository Institutions $ 1,702 $ 1,893 Interest-Bearing
Deposits in Other Banks 2,107 6,544 Federal Funds Sold 360 2,680
Securities Available-for-Sale, at Fair Value 50,852 55,090 Loans,
Net 105,466 93,987 Accrued Interest Receivable 1,883 2,004 Premises
& Equipment, Net 4,263 3,578 Stock in Federal Home Loan Bank,
at Cost 1,009 982 Real Estate Held-for-Investment, Net 457 464
Other Assets � � 1,825 � � � 1,158 � Total Assets � $ 169,924 � � $
168,380 � � LIABILITIES Deposits Interest-Bearing Deposits $
120,597 $ 119,364 Noninterest-Bearing Deposits � � 4,597 � � �
3,390 � Total Deposits � � 125,194 � � � 122,754 � FHLB Advances
16,817 17,042 Other Liabilities � � 927 � � � 1,420 � Total
Liabilities � � 142,938 � � � 141,216 � � STOCKHOLDERS' EQUITY
Common Stock - $.01 Par Value $ 34 $ 34 Additional Paid-in Capital
34,701 34,701 Unearned RRP Trust Stock (523 ) (523 ) Treasury Stock
(32,493 ) (32,493 ) Retained Earnings 25,902 25,764 Accumulated
Other Comprehensive Loss � � (635 ) � � (319 ) Total Stockholders'
Equity � � 26,986 � � � 27,164 � Total Liabilities &
Stockholders' Equity � $ 169,924 � � $ 168,380 � � Selected Asset
Quality Data Total Non Performing Assets $ 502 $ 179 Non Performing
Assets to Total Assets 0.30 % 0.11 % � GS Financial Corp. Condensed
Consolidated Statements of Income (Unaudited) � � � For the Three
Months Ended June 30, � For the Six Months Ended June 30, ($ in
thousands, except per share data) � � 2007 � � � 2006 � � � 2007 �
� � 2006 � Interest and Dividend Income $ 2,733 $ 2,782 $ 5,387 $
5,494 Interest Expense � � 1,342 � � � 1,170 � � � 2,627 � � �
2,344 � � Net Interest Income 1,391 1,612 2,760 3,150 Provision
(Reversal) for Loan Losses � � (300 ) � � - � � � (300 ) � � - �
Net Interest Income after Provision (Reversal) for Loan Losses � �
1,691 � � � 1,612 � � � 3,060 � � � 3,150 � � Non-interest Expense
� � 1,314 � � � 1,187 � � � 2,590 � � � 2,319 � Net Income Before
Non-Interest Income and Income Taxes � � 377 � � � 425 � � � 470 �
� � 831 � � Non-interest Income (Loss) � � 43 � � � (53 ) � � 72 �
� � (45 ) Income Before Tax Expense � � 420 � � � 372 � � � 542 � �
� 786 � � Income Tax Expense � � 127 � � � 129 � � � 153 � � � 267
� Net Income � $ 293 � � $ 243 � � $ 389 � � $ 519 � Earnings Per
Share � Basic � $ 0.24 � � $ 0.20 � � $ 0.32 � � $ 0.43 � Earnings
Per Share �Diluted � $ 0.24 � � $ 0.20 � � $ 0.32 � � $ 0.43 � �
Selected Operating Data Weighted Average Shares Outstanding
1,234,453 1,214,190 1,234,453 1,215,707 Return on Average Assets 1
0.70 % 0.56 % 0.47 % 0.59 % Non-Interest Expense/Average Assets1
3.13 % 2.72 % 3.12 % 2.65 % Net Interest Margin1 � � 3.50 % � �
3.80 % � � 3.49 % � � 3.65 % 1 Annualized
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