SRNN Southern Banc Company Inc (PK)

The Southern Banc Company, Inc. (OTCBB: SRNN), the holding company for The Southern Bank Company, formerly First Federal Savings and Loan Association of Gadsden, Alabama, announced net loss of $85,000, or $(0.11) per basic and diluted share, for the year ended June 30, 2009, as compared to net loss of $133,000, or $(0.17) per basic and diluted share, for the year ended June 30, 2008. For the three month period ended June 30, 2009, the Company reported net loss of $1,000, as compared to net loss of $20,000 for the three month period ended June 30, 2008.

In addition to reporting earnings, the Company announced that the annual meeting of stockholders will be held on November 18, 2009 at 5:00 PM at the main office of The Southern Bank Company in Gadsden, Alabama. The voting record date for the purpose of determining stockholders eligible to vote on proposals presented at the annual meeting is September 25, 2009.

The Southern Banc Company, Inc. (OTCBB: SRNN) announced that the company’s 2009 Annual Report is available at http://www.sobanco.com/investorrelations.shtml.

Gates Little, President and Chief Executive Officer of the Company, stated that the Company’s net loss for the fiscal year ended June 30, 2009 was primarily attributable to an increase in total non-interest expense of approximately $85,000, or 3.6%, and an increase in the provision for loan losses of approximately $64,000, or 356%, offset in part by an improvement of the net interest margin of approximately $227,000, or 11.5%. The increase in total non-interest expense was primarily attributable to increases in salaries and employee benefits, data processing expenses, occupancy expenses and the realization of a net loss on sale of securities, offset by a decrease in professional services.

The Company’s total assets at June 30, 2009 were $98.8 million, as compared to $102.9 million at June 30, 2008. Total stockholders’ equity at June 30, 2009, was $15.5 million, or 15.7% of total assets.

The Bank has four offices located in Gadsden, Albertville, Guntersville, and Centre, Alabama. The stock of The Southern Banc Company, Inc. is listed on the OTC Bulletin Board under the symbol “SRNN.”

Certain statements in this release contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which statements can generally be identified by the use of forward-looking terminology, such as “may,” “will,” “expect,” “estimate,” “anticipate,” “believe,” “target,” “plan,” “project,” “continue,” or the negatives thereof, or other variations thereon or similar terminology, and are made on the basis of management’s plans and current analyses of the Company, its business and the industry as a whole. These forward-looking statements are subject to risks and uncertainties, including, but not limited to, economic conditions, competition, interest rate sensitivity and exposure to regulatory and legislative changes. The above factors, in some cases, have affected, and in the future could affect the Company’s financial performance and could cause actual results to differ materially from those expressed or implied in such forward-looking statements, even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.

THE SOUTHERN BANC COMPANY, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Dollar Amounts in Thousands)

    June 30,   June 30, 2009 2008       ASSETS CASH AND CASH EQUIVALENTS $ 8,971 $ 4,344 SECURITIES AVAILABLE FOR SALE, at fair value 52,569 60,320

SECURITIES HELD TO MATURITY, at amortized cost, fair value of $79 and $100, respectively

73 94 FEDERAL HOME LOAN BANK (FHLB) STOCK 338 328  

LOANS RECEIVABLE, net of allowance for loan losses of $219 and $193, respectively

35,416 36,140 PREMISES AND EQUIPMENT, net 908 947 ACCRUED INTEREST AND DIVIDENDS RECEIVABLE 449 508 PREPAID EXPENSES AND OTHER ASSETS 84 207     TOTAL ASSETS $ 98,808   $ 102,889       LIABILITIES   DEPOSITS $ 79,702 $ 84,387 FHLB ADVANCES 3,075 3,075 OTHER LIABILITIES 505 283     TOTAL LIABILITIES 83,282 87,745     STOCKHOLDERS' EQUITY:

Preferred stock, par value $.01 per share 500,000 shares authorized, no shares issued or outstanding

0 0

Common stock, par value $.01 per share, 3,500,000 authorized, 1,454,750 shares issued

15 15 Additional paid-in capital 13,887 13,887

Shares held in trust, at cost, 25,768 shares

(571 ) (571 ) Retained earnings 10,521 10,811

Treasury stock, at cost, 648,664 shares

(8,825 ) (8,825 )

Accumulated other comprehensive income (loss)

499   (173 )

TOTAL STOCKHOLDERS’ EQUITY

15,526   15,144  

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

98,808   $ 102,889   THE SOUTHERN BANC COMPANY, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollar Amounts in Thousands)       Three Months Ended Twelve Months Ended June 30, June 30, 2009   2008 2009   2008   INTEREST INCOME: Interest and fees on loans $ 502 527 2,116 2,124 Interest and dividends on securities available for sale 593 725 2,471 2,977 Interest and dividends on securities held to maturity 1 2 6 7 Other interest income   4   12   17   118     Total interest income 1,100 1,266 4,610 5,226   INTEREST EXPENSE: Interest on deposits 501 729 2,323 3,122 Interest on borrowings   21   21   85   129   Total interest expense   522   750   2,408   3,251   Net interest income 578 516 2,202 1,975 Provision for loan losses   30   10   82   18  

Net interest income after provision for loan losses

548 506 2,120 1,957     NON-INTEREST INCOME: Customer service fees 39 44 188 127 Gain on sale of securities 0 0 0 67 Miscellaneous income, net   3   3   18   13   Total non-interest income   42   47   206   207   NON-INTEREST EXPENSE: Salaries and employee benefits 345 355 1,434 1,364 Office building and equipment expenses 54 52 285 267 Professional service expense 38 43 176 221 Data processing expense 71 68 216 206 Other operating expense   84   67   352   320   Total non-interest expense   592   585   2,463   2,378     Loss before income taxes (2 ) (32 ) (137 ) (214 ) Provision for income tax (benefit)   (1 ) (12 )

(52

) (81 ) Net Loss $ (1 ) (20 ) (85 ) (133 ) ======== ======== ======== ========   Earnings per share – Basic $ (0.04 )

(0.03

) (0.11 ) (0.17 ) Earnings per share – Diluted $ (0.04 ) (0.03 ) (0.11 ) (0.17 )