8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) January 24, 2008

WAYNE SAVINGS BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

Delaware	0-23433	31-1557791
(State or other jurisdiction	(Commission File No.)	(IRS Employer
of incorporation)		Identification No.)
151 N. Market St., Wooster, Ohio		44691
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (330) 264-5767

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

o       Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o       Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o       Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o       Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Item 2.02 Results of Operations and Financial Condition

On January 24, 2008, Wayne Savings Bancshares, Inc. (the “Company”) issued a press release announcing its earnings for the quarter and nine months ended December 31, 2007.  A copy of the press release dated January 24, 2008 is attached as Exhibit 99 to this report.  The press release is being furnished to the SEC and shall not be deemed to be “filed” for any purpose.

Item 9.01 Financial Statements and Exhibits

(a) Not applicable.

(b) Not applicable.

(c) Not applicable.

(d)           Exhibits

Exhibit No.	Description
99	Press release, dated January 24, 2008

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	WAYNE SAVINGS BANCSHARES, INC.
DATE:  January 24, 2008	By:	/s/ H. Stewart Fitz Gibbon III
		H. Stewart Fitz Gibbon III
		Executive Vice President
		Chief Financial Officer
		Secretary and Treasurer

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EX-99

NEWS RELEASE

FOR RELEASE: IMMEDIATELY

WAYNE SAVINGS BANCSHARES, INC. ANNOUNCES EARNINGS FOR THE QUARTER ENDED DECEMBER 31, 2007

Wooster, Ohio (January 24, 2008) – Wayne Savings Bancshares, Inc. (NASDAQ:WAYN), the stock holding company parent of Wayne Savings Community Bank, reported net income of $446,000, or $.14 per diluted share, for the third fiscal quarter ended December 31, 2007, compared to $563,000, or $.18 per diluted share, for the third fiscal quarter ended December 31, 2006.  The decrease in net income was primarily due to increases in the provision for losses on loans and in general, administrative and other expense, partially offset by increases in net interest income and other income.

Net interest income increased $72,000 for the quarter ended December 31, 2007, compared to the quarter ended December 31, 2006.  Interest income increased $147,000 for the 2007 quarter, compared to the same quarter in 2006, primarily due to a shift in balance sheet composition from investment securities and residential mortgage loans toward higher yielding commercial and non-residential real estate loans, and the reinvestment of maturing investment securities and mortgage-backed securities cashflows into higher yielding securities.  Interest expense increased $75,000 compared to the prior year period as a result of increased rates paid on certificates of deposit and a shift in deposit composition from savings and checking deposits to higher rate certificates of deposit and borrowed funds.

The provision for losses on loans totaled $140,000 during the quarter ended December 31, 2007 compared to a provision of $10,000 during the quarter ended December 31, 2006, based primarily on an increase in non-performing loans, and on management’s evaluation of the portfolio performance indicators, growth in the commercial loan portfolio and economic conditions in our market area.  Non-performing loans increased to $2.1 million, or 0.82% of net loans at December 31, 2007, compared to $0.8 million, or 0.34% of net loans at December 31, 2006.  The increase in non-performing loans was comprised primarily of three commercial loans backed by real estate collateral totaling $1.1 million that have experienced payment difficulties and were placed on non-accrual during the quarter ended December 31, 2007.  Management has evaluated these three loans for specific impairment, including obtaining new appraisals, and made the necessary provision to reflect potential specific impairment.   All three loans are in the workout process, and based on current information, management expects that the adjusted carrying values of the loans will be realized.

Other income increased $25,000, due to increases in income on bank owned life insurance, trust department income and other fee income.  General, administrative and other expense increased by $188,000 primarily due to the effect of the absence of a state franchise tax refund recognized in the December 2006 quarter that did not recur in the December 2007 quarter, along with the effects of filling certain vacant staff positions that existed at December 31, 2006, normal merit payroll increases and increased costs of employee benefits during the December 2007 quarter compared to the December 2006 quarter.  Tax expense decreased $104,000 due to lower pre-tax income and the beneficial effect of additional tax advantaged investments.

For the nine month period ended December 31, 2007, net income totaled $1,516,000 or $0.49 per diluted share, compared to net income of $1,640,000, or $0.51 per diluted share for the nine months ended December 31, 2006.

Net interest income decreased $65,000 for the nine months ended December 31, 2007 compared to the nine months ended December 31, 2006.  Interest income increased $625,000 for the 2007 nine month period compared to the same period in 2006, as a result of a shift in portfolio composition from investment securities and residential mortgage loans toward higher yielding commercial and non-residential real estate loans and the reinvestment of maturing investment securities and mortgage-backed

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securities into higher yielding securities.  Interest expense increased $690,000 compared to the prior year period as a result of increased rates paid on certificates of deposit and a shift in deposit composition from savings and checking deposits to certificates of deposit and borrowed funds.  A provision for losses on loans of $195,000 was made during the nine months ended December 31, 2007 compared to a provision of $70,000 for the nine months ended December 31, 2006, based on management’s evaluation of the portfolio performance indicators, growth in the commercial loan portfolio and economic conditions in our market area and the effect of the three non-performing commercial loans discussed above.

Other income increased $85,000, due primarily to increases in trust fees, income on bank owned life insurance and a $31,000 non-recurring gain on the disposal of a real estate owned property, partially offset by a decrease in other fee income.  General, administrative and other expense increased by $187,000 primarily due to increased state franchise tax expense as discussed above and increased occupancy and other operating expense, partially offset by a $2,000 decrease in employee compensation.  Employee compensation in the 2006 nine month period reflected severance expenses associated with a restructuring of the branch management organization recognized in the 2006 period that did not recur in the 2007 period, partially offset by the effects of filling certain vacant positions, normal merit payroll increases and increased costs of employee benefits as discussed above.  Tax expense decreased by $168,000 due to lower pre-tax income and the beneficial effect of additional tax advantaged investments.

Phillip E. Becker, President and Chief Executive Officer, stated that “the Company is aggressively focused on the monitoring of loan performance and the early implementation of workout arrangements with borrowers experiencing payment difficulties.   These efforts are in addition to our continued focus on discipline in the pricing of loans and deposits to manage the net interest margin and careful underwriting of new loan applications to manage the inherent risk in the Company’s loan portfolio.  The credit conditions in national markets have affected local markets primarily through increased competition for deposits required by larger competitors to meet their liquidity requirements, but also in a reduction in overall loan demand.  Both of these factors continue to pressure the net interest margin.  Management continues to work in a deliberate fashion to offset challenging economic and competitive conditions in the Company’s market area through control and reduction of non-interest expense while positioning the Company to better serve its customer base in the future.”

At December 31, 2007, Wayne Savings Bancshares, Inc. reported total assets of $401.0 million, down from total assets of $405.7 million at March 31, 2007. Deposits decreased $9.6 million, or 2.9%, to $323.9 million at December 31, 2007 from $333.5 million at March 31, 2007. Stockholders’ equity at December 31, 2007 amounted to $34.7 million, or 8.64% of total assets, compared to $34.4 million, or 8.49% of total assets at March 31, 2007.  The $218,000 increase in stockholders’ equity was primarily due a reduction in accumulated comprehensive loss as a result of mark to market adjustments to available for sale securities and the addition of net income, partially offset by the purchase of treasury shares and payment of dividends.

Established in 1899, Wayne Savings Community Bank, the wholly owned subsidiary of Wayne Savings Bancshares, Inc., has eleven full-service banking locations in the communities of Wooster, Ashland, Millersburg, Rittman, Lodi, North Canton, and Creston, Ohio.

Statements contained in this news release which are not historical facts may be forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors. Factors which could result in material variations include, but are not limited to, changes in interest rates which could affect net interest margins and net interest income, competitive factors which could affect net interest income and noninterest income, changes in demand for loans, deposits and other financial services in the Company's market area; changes in asset quality, general economic conditions as well as other factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time. The Company undertakes no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date on which such statements were made.

CONTACT PERSON:	H. STEWART FITZ GIBBON III
	EXECUTIVE VICE PRESIDENT
	CHIEF FINANCIAL OFFICER
	(330) 264-5767

WAYNE SAVINGS BANCSHARES, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share data)
	December 31, 2007			March 31, 2007
	(Unaudited)
ASSETS
Cash, cash equivalents, & investment securities (1)	$	44,681		$	71,908
Mortgage-backed securities, net (1)		83,861			69,065
Loans receivable, net		248,389			240,049
Federal Home Loan Bank stock		4,829			4,829
Office premises & equipment, net		8,025			8,179
Real estate acquired through foreclosure		48			-
Other assets		11,127			11,707
TOTAL  ASSETS	$	400,960		$	405,737
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposit accounts	$	323,919		$	333,540
Advances from Federal Home Loan Bank		38,500			34,500
Advances by borrowers for taxes & insurance		1,050			616
Accounts payable on mortgage loans serviced for others		283			197
Other liabilities		2,557			2,451
TOTAL LIABILITIES		366,309			371,304
Common stock (3,978,731 shares of $.10 par value issued at
December 31, 2007 and March 31, 2007)		398			398
Additional paid-in capital		36,136			36,106
Retained earnings		12,363			11,982
Less required contributions for shares acquired by Employee Stock Ownership Plan		(1,097	)		(1,158	)
Less Treasury Stock (853,725 shares at December 31, 2007 and
784,622 shares at March 31, 2007)		(13,273	)		(12,419	)
Accumulated other comprehensive income (loss), net of tax effects		124			(476	)
TOTAL STOCKHOLDERS' EQUITY		34,651			34,433
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	400,960		$	405,737
(1)  Includes  available for sale classifications.

WAYNE SAVINGS BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except for per share data)
(Unaudited)
	Three Months Ended
	December 31,
	2007		2006
Interest income	$	5,826	$	5,679
Interest expense		3,030		2,955
Net interest income		2,796		2,724
Provision for losses on loans		140		10
Net interest income after provision for loan losses		2,656		2,714
Other income		458		433
General, administrative, and other expense		2,543		2,355
Income  before federal income taxes		571		792
Federal income taxes		125		229
Net income	$	446	$	563
Earnings per share
Basic	$	0.14	$	0.18
Diluted	$	0.14	$	0.18
Dividends per share	$	0.12	$	0.12

	Nine Months Ended
	December 31,
	2007		2006
Interest income	$	17,318	$	16,693
Interest expense		8,922		8,232
Net interest income		8,396		8,461
Provision for losses on loans		195		70
Net interest income after provision for loan losses		8,201		8,391
Other income		1,375		1,290
General, administrative, and other expense		7,567		7,380
Income  before federal income taxes		2,009		2,301
Federal income taxes		493		661
Net income	$	1,516	$	1,640
Earnings per share
Basic	$	0.49	$	0.51
Diluted	$	0.49	$	0.51
Dividends per share	$	0.36	$	0.36

WAYNE SAVINGS BANCSHARES, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Dollars in thousands, except per share data - unaudited)
	For the Three Months
	ended December 31,
	2007			2006
Quarterly Results
Net Interest Income	$	2,796		$	2,724
Net Income	$	446		$	563
Earnings Per Share:
Basic	$	0.14		$	0.18
Diluted	$	0.14		$	0.18
Average Assets	$	400,932		$	403,630
Average Equity	$	34,717		$	35,515
Return on Average Assets (Annualized)		0.44	%		0.56	%
Return on Average Equity (Annualized)		5.14	%		6.34	%

	For the Nine Months
	ended December 31,
	2007			2006
Nine Month Results
Net Interest Income	$	8,396		$	8,461
Net Income	$	1,516		$	1,640
Earnings Per Share:
Basic	$	0.49		$	0.51
Diluted	$	0.49		$	0.51
Average Assets	$	397,528		$	400,764
Average Equity	$	34,329		$	35,659
Return on Average Assets (Annualized)		0.51	%		0.55	%
Return on Average Equity (Annualized)		5.89	%		6.13	%

	December 31,			March 31,
	2007			2007
End of Period Data
Total Assets	$	400,960		$	405,737
Stockholders' Equity	$	34,651		$	34,433
Stockholders' Equity to Total Assets		8.64	%		8.49	%
Shares Outstanding		3,125,006			3,194,109
Book Value Per Share	$	11.09		$	10.78