Elmira Savings Bank Posts 9% Earnings Increase

ELMIRA, N.Y., July 15 /PRNewswire-FirstCall/ -- Elmira Savings Bank, FSB (Nasdaq: ESBK) today announced net income for the six months ended June 30, 2010 totaling $2,312,000 or $.80 per diluted share, compared to the $2,117,000 of net income or $.75 per diluted share reported for the same period in 2009. This represents a 9% or $195,000 increase in net income and a 7% increase in diluted earnings per share.

Net income for the three months ended June 30, 2010 totaled $1,233,000 or $.44 per diluted share compared to $1,098,000 or $.38 per diluted share for the same period in 2009. This represents a 12% or $135,000 increase in net income and a 16% increase in diluted earnings per share.

Net interest income was $7.4 million for the first six months of 2010 compared to $7.8 million for the same period last year. Noninterest income was $2.0 million compared to $2.6 million for the same period in 2009. These unfavorable variances were offset by a decrease of $1.0 million in operating expenses to $5.8 million for the first six months of 2010 from $6.8 million for the same period in 2009, and a decrease in the provision for loan losses from $592,000 for the first six months of 2009, to $350,000 for the first six months of 2010.

Total assets increased by $.2 million from $499.0 million at December 31, 2009 to $499.2 million as of June 30, 2010. Total deposits were $349.4 million as of June 30, 2010 compared to $352.6 million as of December 31, 2009. This represents a $3.2 million or 1% decrease. Total loans decreased by $6.1 million or 2% from $307.6 million as of December 31, 2009 to $301.5 million as of June 30, 2010.

"During the first half of 2010, we continued to focus on credit quality, improving our operating efficiency, and preparing our balance sheet for the risk of inflation," said Michael P. Hosey, President and CEO. Hosey continued, "Our level of net interest income is below the same period from one year ago due to our accumulation of approximately $65 million of cash which we intend to invest in a future higher rate environment. Our improved operating efficiency is evidenced by the year-to-year decline of $1.0 million or 15% in operating expense. We continue to focus on creating long-term shareholder value through continued earnings and earnings per share growth, maintaining credit quality, and managing interest rate risk."

Elmira Savings Bank, FSB with $499.2 million in total assets, is insured by the Federal Deposit Insurance Corporation (FDIC) and is a federally chartered Bank with five offices in Chemung County, NY; three offices and a loan center in Tompkins County, NY; one office in Steuben County, NY; one office in Cayuga County, NY; and a cashless branch in Schuyler County, NY.

Except for the historical information contained herein, the matters discussed in this news release are forward looking statements that involve the risks and uncertainties, including the timely availability and acceptance of Bank products, the impact of competitive products and pricing, the management of growth, and other risks detailed from time to time in the Bank's regulatory reports.

SOURCE Elmira Savings Bank, FSB