GOUVERNEUR, N.Y., Nov. 18 /PRNewswire-FirstCall/ -- Richard F. Bennett, President and Chief Executive Officer of Gouverneur Bancorp, Inc. (OTC Bulletin Board: GOVB) (the "Company") and its subsidiary, Gouverneur Savings and Loan Association (the "Bank"), announced today results for its fiscal year ended September 30, 2009. Net income for the fiscal year ended September 30, 2009 increased 24.0% to $1,291,000, or $0.56 per diluted share, compared to $1,041,000, or $0.45 per diluted share, in fiscal 2008. The return on average assets and average equity increased to 0.93% and 6.04%, respectively, for the year ended September 30, 2009 from 0.78% and 5.03%, respectively, for the year ended September 30, 2008. Total assets grew by $7.0 million, or 5.1%, from $136.7 million at September 30, 2008 to $143.7 million at September 30, 2009, while net loans increased $3.6 million, or 3.3%, from $110.5 million to $114.1 million over the same period. Commenting on the results for the year, Mr. Bennett said, "We are pleased with our results for the 2009 fiscal year in light of the meltdown of the financial system caused by the banks deemed "Too Big to Fail". We did not make the risky loans that burst the housing bubble nor have we purchased the investment products containing those risky loans. We have continued to operate as a community bank by serving the needs of our local customers. The local economy has been affected by the general downturn in the national economy, but not to the extent of other geographic areas. Gouverneur Savings and Loan remains well-capitalized with a core capital ratio of 15.0%, the same as last year, and strong asset composition with non-performing assets representing only 0.99% of total assets, slightly higher than last years 0.86%. The Federal government has worked to reduce mortgage rates in hopes of spurring the housing market. However, mortgage rates are currently below 5% and that has not had the desired effect. We are unable to hold mortgages to term at those levels, so we have not moved our rates down to match. Thus far, we haven't seen any shrinkage in our loan portfolio, but that may happen if competing rates continue to stay so low." In fiscal 2009, interest income decreased $38,000, or 0.5%, from $7,849,000 to $7,811,000, while interest expense decreased $688,000, or 19.2%, from $3,590,000 to $2,902,000. Interest spread, the difference between the rate earned on interest-earning assets and the rate paid on interest-bearing liabilities, was 3.38% in fiscal 2009 and 2.96% in fiscal 2008. Non-interest income increased $186,000 from $679,000 in fiscal year 2008 to $865,000 in fiscal 2009. Increases in the values of the underlying investments in the deferred directors fees plan, service charges and ATM fees by $125,000, $57,000 and $12,000, respectively, resulted in the gain. Net loans grew $3.6 million in fiscal 2009 as compared to growth of $4.4 million in fiscal 2008. The quality of our loan portfolio has remained strong. We made a $60,000 provision for loan losses in fiscal 2009 after making no provision in the 2008 fiscal year. Non-performing loans were $750,000 at September 30, 2009, compared to $1,108,000 at September 30, 2008. Net charge-offs were $124,000 for the year ended September 30, 2009. The allowance for loan losses was $797,000, or 0.70% of total loans outstanding at September 30, 2009 as compared to $861,000, or 0.78% at September 30, 2008. The components of non-interest expense are presented in the following table: For the year ended September 30, 2009 2008 ---- ---- (In thousands) Salaries and employee benefits $1,969 $1,845 Directors' fees 168 168 Building, occupancy and equipment 515 482 Advertising 68 62 Other operating expense 1,046 894 ----- --- Non interest expense $3,766 $3,451 ====== ====== Salaries and employee benefits expense increased by $124,000 in fiscal 2009 mainly due to performance increases to employees, increased pension and retirement benefit expense and an increase in other employee benefit costs of $60,000, $34,000 and $23,000, respectively. The increase in other operating expense resulted mostly from an increase of $125,000 in the values of the underlying investments in the deferred directors fees plan. Deposits increased $6.1 million, or 7.2%, to $91.4 million at September 30, 2009 from $85.3 million at September 30, 2008 including a decrease of $1.7 million in brokered deposits from $3.0 million last year to $1.3 million this year. Securities sold under agreements to repurchase with the Federal Home Loan Bank of New York ("FHLB") were $5.0 million at September 30, 2009 and 2008, while advances from the FHLB decreased $0.8 million from $22.8 million to $22.0 million over the same period Shareholders' equity was $21.9 million at September 30, 2009, representing an increase of 5.8% over the September 30, 2008 balance of $20.7 million. The Company's book value was $9.60 per common share based on 2,277,199 shares issued and outstanding at September 30, 2009 versus $9.02 on 2,299,384 shares issued and outstanding on September 30, 2008. The Company paid cash dividends totaling $0.34 per share to all public holders of our stock, while Cambray Mutual Holding Company, our majority shareholder, waived its right to receive dividends during the fiscal year ending September 30, 2009. The Company, which is headquartered in Gouverneur, New York, is the holding company for Gouverneur Savings and Loan Association. Founded in 1892, the Bank is a federally chartered savings and loan association offering a variety of banking products and services to individuals and businesses in its primary market area in southern St. Lawrence and northern Lewis and Jefferson Counties in New York State. Statements in this news release contain forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs of management as well as assumptions made using information currently available to management. Since these statements reflect the views of management concerning future events, these statements involve risks, uncertainties and assumptions. These risks and uncertainties include among others, the impact of changes in market interest rates and general economic conditions, changes in government regulations, changes in accounting principles and the quality or composition of the loan and investment portfolios. Therefore, actual future results may differ significantly from results discussed in the forward-looking statements due to a number of factors, which include, but are not limited to, factors discussed in the documents filed by the Company with the Securities and Exchange Commission from time to time. DATASOURCE: Gouverneur Bancorp, Inc. CONTACT: Robert J. Twyman, Vice President and Chief Financial Officer, +1-315-287-2600

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