Greene County Bancorp, Inc. Reports Net Income For the Nine and Three Months Ended March 31, 2014 and is Recognized by

  Greene County Bancorp, Inc. Reports Net Income For the Nine and Three Months
  Ended March 31, 2014 and is Recognized by Investment Banking Firm KBW for
  Exceptional 10 Year Track Record

Business Wire

CATSKILL, N.Y. -- April 22, 2014

Greene County Bancorp, Inc. (the “Company”) (NASDAQ:GCBC), the holding company
for The Bank of Greene County and its subsidiary Greene County Commercial
Bank, today reported net income for the nine and three months ended March 31,
2014, which is the third quarter of the Company’s fiscal year ending June 30,
2014. Net income for the nine and three months ended March 31, 2014 was $5.0
million, or $1.18 per basic and $1.17 per diluted share, and $1.5 million, or
$0.36 per basic and $0.35 per diluted share, respectively, as compared to $5.0
million, or $1.19 per basic and $1.18 per diluted share, and $1.5 million, or
$0.37 per basic and $0.36 per diluted share, for the nine and three months
ended March 31, 2013, respectively. Net income increased $5,000, or 0.1% when
comparing the nine months ended March 31, 2014 and 2013, and decreased
$41,000, or 2.7% when comparing the three months ended March 31, 2014 and
2013.

Donald Gibson, President & CEO stated, “I am pleased to report another quarter
of solid earnings and asset growth. During the quarter ended March 31, 2014,
we have been able to strategically acquire new customer relationships
resulting from their displacement or dissatisfaction with several large
national banks in our market due to the consolidation or sale of branch
offices. These new customer relationships have provided us with core deposit
and loan growth which, we believe is our best option to build long-term value
for both our community and shareholders.”

In addition, we are proud to announce that investment banking firm Keefe,
Bruyette & Woods, Inc. (“KBW”) has recognized Greene County Bancorp, Inc. for
its exceptional 10 year track record. This year only 31 U.S. banking
institutions out of nearly 400 total companies screened made the 2013 KBW
Honor Roll. Honor roll winners are publicly traded banking institutions with
more than $500 million in assets that met the following conditions (excluding
extraordinary items):

1) No annual loss in net income per share reported over the past 10 years;

2) 2013 annual net income per share equal to or greater than the peak net
income per share reported over the past 10 years; and

3) Consecutive increases in net income per share since 2009.

Selected highlights for the nine and three months ended March 31, 2014 are as
follows:

  *Net interest income decreased $95,000 to $16.0 million for the nine months
    ended March 31, 2014 from $16.1 million for the nine months ended March
    31, 2013 and totaled $5.4 million and $5.3 million for the three months
    ended March 31, 2014 and 2013, respectively. The change in net interest
    income resulted from the narrowing of the net interest spread and margin
    when comparing the nine and three months ended March 31, 2014 and 2013.
  *Net interest spread decreased 21 basis points to 3.31% as compared to
    3.52% when comparing the nine months ended March 31, 2014 and 2013,
    respectively. Net interest margin decreased 23 basis points to 3.38% for
    the nine months ended March 31, 2014 as compared to 3.61% for the nine
    months ended March 31, 2013. Net interest spread decreased 15 basis points
    to 3.25% as compared to 3.40% when comparing the three months ended March
    31, 2014 and 2013, respectively. Net interest margin decreased 17 basis
    points to 3.32% for the three months ended March 31, 2014 as compared to
    3.49% for the three months ended March 31, 2013. In the continuing low
    interest rate environment, the average rates on our interest earning
    assets has decreased more than the rates paid on our interest
    bearing-liabilities. This has been partially offset by growth in interest
    earning asset balances.
  *The provision for loan losses amounted to $1.1 million and $1.3 million
    for the nine months ended March 31, 2014 and 2013, respectively, and was
    $288,000 and $331,000 for the three months ended March 31, 2014 and 2013,
    respectively. The level of allowance for loan losses to total loans
    receivable decreased to 1.84% as of March 31, 2014 as compared to 1.94% as
    of June 30, 2013.
  *Net charge-offs amounted to $808,000 and $571,000 for the nine months
    ended March 31, 2014 and 2013, respectively, an increase of $237,000. Net
    charge-offs amounted to $118,000 and $173,000 for the three months ended
    March 31, 2014 and 2013, respectively, a decrease of $55,000.
  *Nonperforming loans amounted to $6.1 million and $6.9 million at March 31,
    2014 and June 30, 2013, respectively. Nonperforming loans remain high
    compared to our historical levels as a result of adverse changes in the
    economy and local unemployment, which have been compounded by the extended
    length of time required to complete foreclosures in New York State.
  *Noninterest income increased $198,000, or 5.3%, to $3.9 million for the
    nine months ended March 31, 2014 as compared to $3.7 million for the nine
    months ended March 31, 2013. Noninterest income increased $107,000, or
    9.4%, for the three months ended March 31, 2014 as compared to March 31,
    2013 and totaled $1.2 million and $1.1 million, respectively. These
    increases were primarily due to an increase in debit card fees resulting
    from continued growth in the number of checking accounts with debit cards,
    and income generated through investment services.
  *Noninterest expense increased $473,000, or 4.2%, when comparing the nine
    months ended March 31, 2014 and 2013 and totaled $11.8 million and $11.4
    million, respectively. The increase was primarily due to an increase in
    salaries and employee benefits of $512,000 resulting from expenses
    recognized for the Company’s phantom stock option plan as well as various
    other employee benefits. The increase was also due to a $139,000 increase
    in legal and professional fees resulting from an increase in consulting
    services utilized during the nine months ended March 31, 2014. This
    increase was partially offset by a $166,000 decrease in service and data
    processing fees due to lower debit card processing fees resulting from the
    renegotiation of the contract between the Company and its vendor which
    provided for reduced fees during the nine months ended March 31, 2014. It
    is expected that these fees will increase in subsequent periods as these
    incentives have expired. Noninterest expense increased $329,000, or 8.3%,
    when comparing the three months ended March 31, 2014 and 2013 and total
    $4.3 million and $3.9 million, respectively. Similar to results for the
    nine months ended March 31, 2014, salaries and employee benefits increased
    $328,000 and legal and professional fees increased $25,000 and service and
    data processing fees decreased $11,000 when comparing the three months
    ended March 31, 2014 and 2013. Also, occupancy expense increased $37,000
    and equipment and furniture expense decreased $47,000 when comparing the
    three months ended March 31, 2014 and 2013. These fluctuations were the
    result of higher real estate taxes paid and lower depreciation expense as
    older fixed assets have become fully depreciated.
  *Total assets of the Company were $700.5 million at March 31, 2014 as
    compared to $633.6 million at June 30, 2013, an increase of $66.9 million,
    or 10.6%.
  *Securities available for sale and held to maturity amounted to $228.4
    million, or 32.6% of assets, at March 31, 2014 as compared to $246.2
    million, or 38.9% of assets, at June 30, 2013, a decrease of $17.8
    million, or 7.2%.
  *Net loans receivable increased $33.1 million, or 9.2%, to $392.5 million
    at March 31, 2014 from $359.4 million at June 30, 2013. The loan growth
    experienced during the nine months consisted primarily of $16.5 million in
    nonresidential real estate loans, $13.8 million in residential mortgage
    loans, and $4.6 million in commercial loans, and was partially offset by a
    $1.4 million decrease in multi-family mortgage loans and a $468,000
    decrease in construction loans.
  *Total deposits increased $62.8 million, or 11.2%, to $621.2 million at
    March 31, 2014 from $558.4 million at June 30, 2013. The growth in
    deposits was primarily in checking and money market products. Noninterest
    bearing deposits increased $4.2 million, or 7.3%, NOW deposits increased
    $45.1 million, or 22.7%, and money market deposits increased $15.2
    million, or 17.7%, when comparing March 31, 2014 and June 30, 2013,
    resulting from an increase in municipal deposits of $47.3 million.
  *The Company had no short term borrowings, and $14.5 million of long-term
    borrowings, with the Federal Home Loan Bank at March 31, 2014 compared to
    $10.6 million of short term borrowings and $4.0 million of long-term
    borrowings at June 30, 2013.
  *Total shareholders’ equity increased $3.7 million to $59.8 million, or
    8.5% of total assets, at March 31, 2014, from total equity of $56.1
    million, or 8.9% of total assets, at June 30, 2013. This change reflects
    net income of $5.0 million which was partially offset by dividends
    declared and paid of $1.0 million, and a $485,000 increase in accumulated
    other comprehensive loss associated with available for sale securities.
    Other changes in equity which included a $199,000 increase were the result
    of options exercised through the Company’s 2008 Stock Option Plan.

Greene County Bancorp, Inc. is the direct and indirect holding company,
respectively, for The Bank of Greene County, a federally chartered savings
bank, and Greene County Commercial Bank, a New York-chartered commercial bank,
headquartered in Catskill, New York. Our primary market area is the Hudson
Valley Region of New York State. For more information on Greene County
Bancorp, Inc., visit www.tbogc.com.

This press release contains statements about future events that constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Actual results could differ materially from
those projected in the forward-looking statements. Factors that might cause
such a difference include, but are not limited to, general economic
conditions, changes in interest rates, regulatory considerations, competition,
technological developments, retention and recruitment of qualified personnel,
and market acceptance of the Company’s pricing, products and services.


                       At or for the Nine        At or for the Three
                           Months Ended March 31,      Months Ended March 31,
                           2014        2013        2014        2013
Dollars In
thousands,
                                                                
except share and
per share data
Interest income            $17,731       $18,223       $5,954        $5,985
Interest expense           1,760         2,157         600           681
Net interest               15,971        16,066        5,354         5,304
income
Provision for loan         1,109         1,316         288           331
losses
Noninterest income         3,914         3,716         1,248         1,141
Noninterest                11,838        11,365        4,275         3,946
expense
Income before              6,938         7,101         2,039         2,168
taxes
Tax provision              1,963         2,131         543           631
Net Income                 $4,975        $4,970        $1,496        $1,537
                                                                     
Basic EPS                  $1.18         $1.19         $0.36         $0.37
Weighted average
                           4,203,350     4,185,707     4,211,531     4,187,671
shares outstanding
                                                                     
Diluted EPS                $1.17         $1.18         $0.35         $0.36
Weighted average
                           4,239,657     4,224,814     4,243,398     4,227,166
diluted shares
outstanding
                                                                     
Dividends declared         $0.525        $0.525        $0.175        $0.175
per share ^3
                                                                     
Selected Financial
Ratios
Return on average          1.02%         1.08%         0.90%         0.98%
assets^1
Return on average          11.50%        12.23%        10.13%        11.14%
equity^1
Net interest rate          3.31%         3.52%         3.25%         3.40%
spread^1
Net interest               3.38%         3.61%         3.32%         3.49%
margin^1
Efficiency ratio^2         59.53%        57.45%        64.75%        61.23%
Non-performing
assets                     0.97%         1.15%

to total assets
Non-performing
loans                      1.55%         2.01%

to net loans
Allowance for loan
losses to
                           120.74%       98.31%
non-performing
loans
Allowance for loan
losses to                  1.84%         1.94%

total loans
Shareholders’
equity to total            8.54%         8.59%
assets
Dividend payout            44.49%        44.12%
ratio^3
Book value per             $14.19        $13.32
share


^1 Ratios are annualized when necessary

^2 Noninterest expense divided by the sum of net interest income and
noninterest income.

^3 The dividend payout ratio has been calculated based on the dividends
declared per share divided by basic earnings per share. No adjustments have
been made to account for dividends waived by Greene County Bancorp, MHC
(“MHC”), the owner of 54.8% of the Company’s shares outstanding. The MHC
waived its right to receive dividends declared during the nine months ended
March 31, 2014 and the three months ended March 31, 2013, but did not waive
its right to receive dividends declared during the six months ended December
31, 2012.


                                            As of                As of
                                                         
                                            March 31, 2014       June 30, 2013
(Dollars In thousands)
Assets
Total cash and cash equivalents             $55,599              $6,222
Long term certificate of deposit            250                  250
Securities- available for sale, at          51,280               69,644
fair value
Securities- held to maturity, at            177,089              176,519
amortized cost
Federal Home Loan Bank stock, at            1,383                1,388
cost
                                                                 
Gross loans receivable                      399,007              365,839
Less: Allowance for loan losses             (7,341)              (7,040)
Unearned origination fees and               814                  627
costs, net
Net loans receivable                        392,480              359,426
                                                                 
Premises and equipment                      14,246               14,349
Accrued interest receivable                 2,967                2,663
Foreclosed real estate                      716                  296
Prepaid expenses and other assets           4,463                2,848
Total assets                                $700,473             $633,605
                                                                 
Liabilities and shareholders’
equity
Noninterest bearing deposits                $62,124              $57,926
Interest bearing deposits                   559,114              500,513
Total deposits                              621,238              558,439
                                                                 
Borrowings from FHLB, short term            -                    10,600
Borrowings from FHLB, long term             14,500               4,000
Accrued expenses and other                  4,939                4,458
liabilities
Total liabilities                           640,677              577,497
Total shareholders’ equity                  59,796               56,108
Total liabilities and shareholders’         $700,473             $633,605
equity
Common shares outstanding                   4,213,757            4,192,654
Treasury shares                             91,913               113,016


Contact:

Greene County Bancorp, Inc.
Donald E. Gibson, 518-943-2600
President & CEO
donaldg@tbogc.com
or
Michelle M. Plummer, CPA, 518-943-2600
EVP, COO & CFO
michellep@tbogc.com
 
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