Elmira Savings Bank Posts 4% Earnings Increase

ELMIRA, NY--(Marketwire - Oct 26, 2011) - Elmira Savings Bank, FSB (NASDAQ: ESBK) today announced net income for the nine months ended September 30, 2011 totaling $3,738,000 or $1.19 per diluted share, compared to the $3,607,000 of net income or $1.27 per diluted share reported for the same period in 2010. This represents a 4% or $131,000 increase in net income.

Net income for the three months ended September 30, 2011 totaled $1,316,000 or $.34 per diluted share compared to $1,295,000 or $.47 per diluted share for the same period in 2010. This represents a 2% or $21,000 increase in net income.

Net interest income was $11.7 million for the first nine months of 2011 compared to $11.1 million for the same period last year.

Total assets increased by $18.3 million from $499.8 million at December 31, 2010 to $518.1 million as of September 30, 2011. Total deposits were $376.0 million as of September 30, 2011 compared to $356.6 million as of December 31, 2010. This represents a $19.4 million or 5% increase. Total loans increased by $33.7 million or 11% from $309.9 million as of December 31, 2010 to $343.6 million as of September 30, 2011.

"During the first nine months of 2011, we have experienced loan growth above our expectations in all portfolios. Our net interest margin, asset quality, and efficiency all continue to be strong. The dividend yield on our common stock is approximately 5%," said Michael P. Hosey, President and CEO.

Hosey continued, "We are focusing our commercial lending efforts on lending to small businesses in an effort to reduce the dividend rate on the preferred shares issued to the Treasury Department during the third quarter through the Small Business Lending Fund."

Elmira Savings Bank, FSB with $518.1 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; one cashless office in Schuyler County; NY; and a loan center in Cortland 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.

Elmira Savings Bank, FSB
SELECTED CONSOLIDATED INCOME STATEMENT ITEMS
(Unaudited)
(In thousands except per share amounts)
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
Net interest income	$	3,836		$	3,683		$	11,705		$	11,051
Provision for loan losses		195			85			527			435
Gain on sale of securities		0			160			296			469
Other noninterest income		1,200			1,097			3,049			3,049
Total noninterest expense		2,943			2,957			9,036			8,814
Income before taxes		1,898			1,898			5,487			5,320
Net income		1,316			1,295			3,738			3,607
Dividends on preferred stock		427			343			1,106			1,023
Accretion of preferred stock discount		210			22			252			63
Income available to common shareholders		679			930			2,380			2,521
Basic earnings per common share	$	0.35		$	0.47		$	1.22		$	1.29
Diluted earnings per common share	$	0.34		$	0.47		$	1.19		$	1.27
Dividends per common share	$	0.20		$	0.20		$	0.60		$	0.60

Elmira Savings Bank, FSB
SELECTED CONSOLIDATED BALANCE SHEET ITEMS
(Unaudited)
(In thousands except per share amounts)
	September 30			December 31			September 30
	2011			2010			2010
Total assets	$	518,090		$	499,839		$	502,667
Loans receivable		343,579			309,945			304,561
Allowance for loan losses		3,216			2,909			2,863
Deposits		376,023			356,621			358,400
Borrowings		70,038			81,093			81,111
Shareholders' equity		64,586			56,451			56,988
Book value per common share	$	20.72		$	19.30		$	19.59