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 a net income of approximately $70,000, or $0.09 per basic and diluted share, for the quarter ended September 30, 2009, as compared to a net loss of $6,000, or $(0.01) per basic and diluted share, for the quarter ended September 30, 2008.

Gates Little, President and Chief Executive Officer of the Company, stated that the Company’s net interest margins improved during the quarter as compared to the same period in 2008. Net interest income for the quarter ended September 30, 2009 was approximately $564,000 as compared to approximately $521,000 for the quarter ended September 30, 2008. The improvement in the net interest margin for the quarter was primarily attributable to a decrease in total interest expense of approximately $223,000 offset in part by a decrease in total interest income of approximately $180,000. For the quarter ended September 30, 2009, total non-interest income increased approximately $80,000 or 144.4% while total non-interest expense decreased approximately $2,000 or 0.33% as compared to the same three month period in 2008. The increase in non-interest income was primarily attributable to an increase in net gain on sale of securities available for sale of approximately $97,000 offset in part by a decrease in customer service fees of approximately $16,000.

The Company’s total assets at September 30, 2009 were $96.18 million, as compared to $98.8 million at June 30, 2009. Total stockholders’ equity was approximately $15.8 million at September 30, 2009 or 16.4% of total assets as compared to approximately $15.5 million at June 30, 2009 or approximately 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)

    September 30,   June 30, 2009 2009       ASSETS CASH AND CASH EQUIVALENTS $ 8,510 $ 8,971 SECURITIES AVAILABLE FOR SALE, at fair value 51,418 52,569

SECURITIES HELD TO MATURITY, at amortized cost, fair value of $85 and $112, respectively

70 74 FEDERAL HOME LOAN BANK (FHLB) STOCK 338 338  

LOANS RECEIVABLE, net of allowance for loan losses of $194 and $170, respectively

33,988 35,416 PREMISES AND EQUIPMENT, net 888 907 ACCRUED INTEREST AND DIVIDENDS RECEIVABLE 375 449 PREPAID EXPENSES AND OTHER ASSETS 122 84     TOTAL ASSETS $ 96,059   $ 98,808       LIABILITIES   DEPOSITS $ 77,603 $ 79,702 FHLB ADVANCES 2,075 3,075 OTHER LIABILITIES 623 505     TOTAL LIABILITIES 80,301 83,282     STOCKHOLDERS' EQUITY:

Preferred stock, par value $.01 per share 500,000 shares authorized, shares issued and outstanding -- none

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 10,592 10,521

Treasury stock, at cost, 648,664 shares

(8,825 ) (8,825 ) Accumulated other comprehensive (loss) 661   499  

TOTAL STOCKHOLDERS’ EQUITY

15,758   15,526  

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

96,059   $ 98,808  

THE SOUTHERN BANC COMPANY, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Dollar Amounts in Thousands, except per share data)

    Three Months Ended September 30,   2009 2008 (Unaudited) (Unaudited) INTEREST INCOME:   Interest and fees on loans $ 518 $ 567 Interest and dividends on securities available for sale 518 644 Interest and dividends on securities held to maturity 1 2 Other interest income 3 8

Total interest income

1,040 1,221  

INTEREST EXPENSE:

Interest on deposits 456 679 Interest on borrowings 21 21 Total interest expense 477 700

Net interest income before provision for loan losses

563 521 Provision for loan losses 6 3

Net interest income after provision for loan losses

558 518  

NON-INTEREST INCOME:

Fees and other non-interest income 35 51 Net gain on sale of securities 97 0 Miscellaneous income 3 5 Total non-interest income 135 56  

NON-INTEREST EXPENSE:

Salaries and employee benefits 344 350 Office building and equipment expenses 54 52 Professional Services Expense 37 42 Data Processing Expense 69 68 Other operating expense 78 72 Total non-interest expense 582 584 Loss before income tax benefit 112 (10)  

PROVISION FOR INCOME TAX (BENEFIT)

42 (4)

Net Income (Loss)

$

70

$

(6)   EARNINGS PER SHARE: Basic $ 0.09 $ (0.01) Diluted $ 0.09 $ (0.01)  

DIVIDENDS DECLARED PER SHARE

$

0.0000

$

0.0875   AVERAGE SHARES OUTSTANDING: Basic 780,318 780,318 Diluted 780,398 780,422