EX-99.1 2 a5315598ex991.txt GREENE COUNTY BANCSHARES, INC. EXHIBIT 99.1 Exhibit 99.1 Greene County Banchares Reports Fourth Quarter Diluted EPS up 33% 2006 Marks Sixth Consecutive Year of Record Earnings GREENEVILLE, Tenn.--(BUSINESS WIRE)--January 22, 2007--Greene County Bancshares, Inc. (NASDAQ: GCBS) today reported a strong finish to 2006, with earnings per diluted share up 33% for the fourth quarter. Driven by higher net interest income and significant growth in non-interest income - and underpinned by improving credit quality trends - the Company's fourth quarter results enabled Greene County Bancshares to post its sixth consecutive year of record earnings. Net income for the fourth quarter of 2006 increased to $5,174,000, up 35% from $3,838,000 in the fourth quarter of 2005. On a diluted per share basis, earnings totaled $0.52 for the fourth quarter, an increase of 33% from $0.39 reported for the fourth quarter of 2005. For the full year 2006, net income reached $21,262,000 versus $14,163,000 for 2005, an increase of over 50%. On a diluted per share basis, earnings for 2006 totaled $2.14, rising 25% from $1.71 in the same period a year ago. Commenting on the Company's announcement, Stan Puckett, Chairman and Chief Executive Officer, said, "As our reported results indicate, our company made significant progress during 2006 in terms of new business development and ongoing market penetration across virtually all of our markets. Programs to increase loan volume and build our deposit base have been successful, translating into significant organic balance sheet growth during the year. This, coupled with improved net interest margins and steady improvements in our asset quality measures, provided continued momentum for revenue and earnings growth in 2006 - easily the most growth we have witnessed in the last six years of record results." Return on Average Assets (ROA) improved notably compared with the year-earlier period. The Company's ROA was 1.20% in the fourth quarter of 2006 compared with 0.98% in the year-earlier quarter. Return on Average Equity (ROE) increased to 11.16% in the fourth quarter of 2006 from 9.10% in the fourth quarter of 2005. Return on Average Tangible Equity (average shareholders' equity less goodwill and intangible assets) (ROTE) was 14.10% in the fourth quarter of 2006 versus 11.65% in the year-earlier quarter. For the year, ROA increased to 1.28% from 1.02% for 2005, while ROE increased to 11.91% from 11.09% for 2005. ROTE for 2006 was 15.25% versus 14.04% for 2005. Puckett noted that quarterly loan growth remained healthy throughout 2006, with the Company's loan portfolio rising approximately 12% over 2005, underscoring the economic strength of the Company's key markets. At the same time, credit quality remained strong, as non-performing loans relative to total loans declined to 0.23% at year's end, down from 0.49% at the end of 2005. Net charge-offs for 2006 were 0.20% of average total loans versus 0.32% in 2005. The net interest margin was 4.66% for the current quarter, dropping just one basis point from net interest margin of 4.67% in the year-earlier period. For the full year, net interest margin increased 16 basis points to 4.77% from 4.61% in 2005. Improved margins for the full year 2006, achieved against challenging competitive and interest rate environments, reflected the Company's ongoing efforts to optimize its funding mix. Despite this progress, some margin compression did occur during the fourth quarter as the yield curve continued to invert. Puckett commented that the Company was able to overcome the impact of this challenging interest rate environment through continued initiatives to increase non-interest income associated with its High Performance Checking product. Greene County Bancshares continued to focus on controlling expenses as it expanded its business and market reach. The Company's efficiency ratio was 58.73% in the fourth quarter, an improvement from 61.21% in the fourth quarter of 2005. For the full year, the Company's efficiency ratio was 56.91% versus 60.29% for 2005. Net interest income for the fourth quarter increased 10% to $18,468,000 from $16,839,000 in the year-earlier period, driven by a 12% increase in average loans outstanding between the periods. The quarter's provision for loan losses was $1,538,000, down from $1,979,000 in the fourth quarter of last year and reflecting ongoing improvements in asset quality. Net interest income for the year increased 22% to $71,957,000 compared with $58,786,000 for 2005, bolstered by a 16% increase in organic average loans outstanding, excluding the Clarksville branch acquisition. The Company's provision for loan losses declined 13% to $5,507,000 in 2006 from $6,365,000 in the prior year. Non-interest income increased 34% in the fourth quarter to $5,804,000 from $4,321,000 in the same quarter last year, while non-interest income for 2006 rose 41% to $20,778,000 from $14,756,000 in 2005. These advances reflected the ongoing positive impact of the Company's High Performance Checking Account product, a key strategic initiative. Fourth quarter "net" new checking accounts opened totaled 3,486 compared with 1,830 during the same quarter last year, an increase of over 90%. This momentum has helped drive non-interest income to 22% of total revenue in 2006, up from 20% in 2005. Non-interest expenses totaled $14,255,000 in the fourth quarter, up $1,303,000 or 10% over the same period a year ago and driven by additional formula-based incentive accruals and OREO-related expenses. For the full year 2006, non-interest expenses totaled $52,776,000 compared with $44,340,000 in 2005. Current year's expenses include the normal incremental operating expenses of $2,643,000 associated with the Company's purchase of five Clarksville branches in October 2005. Puckett concluded, "Although we believe that 2007 will be a challenging year, we anticipate that earnings will continue to increase as we strengthen our position within our existing markets and further expand into adjacent markets." At December 31, 2006, the Company's total assets increased 9% to $1,772,654,000 from $1,619,989,000 at December 31, 2005. Net loans increased 12% to $1,539,629,000 at December 31, 2006, from $1,378,642,000 at December 31, 2005. Deposits rose 3% to $1,332,505,000 at December 31, 2006, from $1,295,879,000 at December 31, 2005. Total shareholders' equity increased 10% to $184,471,000 at December 31, 2006, versus $168,021,000 at December 31, 2005. Greeneville, Tennessee-based Greene County Bancshares, Inc., with total assets of approximately $1.8 billion, is the holding company for Greene County Bank. Greene County Bank, founded in 1890, has 49 branches throughout East and Middle Tennessee, and one branch each in Bristol, Virginia, and Hot Springs, North Carolina, and a wealth management office in Lebanon, Tennessee. In addition, Greene County Bank also conducts separate businesses through three wholly owned subsidiaries: Superior Financial Services, Inc., a consumer finance company; GCB Acceptance Corporation, a consumer finance company specializing in subprime automobile lending; and Fairway Title Co., a title insurance company. This news release may contain forward-looking statements regarding Greene County Bancshares, Inc., as defined in Section 21E of the Securities Exchange Act of 1934. All forward-looking statements involve risk and uncertainty and actual results could differ materially from the anticipated results or other expectations expressed in the forward-looking statements. A discussion of factors that could cause actual results to differ materially from those expressed in the forward-looking statements is included in the Greene County Bancshares, Inc. filings with the Securities and Exchange Commission. GREENE COUNTY BANCSHARES, INC. Unaudited Financial Highlights (In thousands, except per share amounts) Three Months Ended Year Ended ------------------------------ ----------------------- Dec. 31, Sept. 30, Dec. 31, Dec. 31, Dec. 31, 2006 2006 2005 2006 2005 -------- --------- ----------- ----------- ----------- Interest income $31,734 $30,367 $25,638 $117,357 $87,191 Interest expense 13,266 11,837 8,799 45,400 28,405 -------- --------- ----------- ----------- ----------- Net interest income 18,468 18,530 16,839 71,957 58,786 Provision for loan losses 1,538 1,661 1,979 5,507 6,365 -------- --------- ----------- ----------- ----------- Net interest income after provision for loan losses 16,930 16,869 14,860 66,450 52,421 Non-interest income 5,804 5,191 4,321 20,778 14,756 Non-interest expense 14,255 13,136 12,952 52,776 44,340 -------- --------- ----------- ----------- ----------- Income before income taxes 8,479 8,924 6,229 34,452 22,837 Income taxes 3,305 3,415 2,391 13,190 8,674 -------- --------- ----------- ----------- ----------- Net income $5,174 $5,509 $3,838 $21,262 $14,163 ======== ========= =========== =========== =========== Comprehensive income $5,244 $5,672 $3,627 $21,503 $13,820 ======== ========= =========== =========== =========== Earnings per share: Basic $0.53 $0.56 $0.40 $2.17 $1.73 ======== ========= =========== =========== =========== Diluted $0.52 $0.56 $0.39 $2.14 $1.71 ======== ========= =========== =========== =========== Weighted average shares: Basic 9,805 9,790 9,710 9,788 8,184 ======== ========= =========== =========== =========== Diluted 9,942 9,900 9,800 9,933 8,276 ======== ========= =========== =========== =========== Dividends declared per share $0.28 $0.12 $0.26 $0.64 $0.62 ======== ========= =========== =========== =========== Dec. 31, Sept. 30, Dec. 31, 2006 2006 2005 ----------- ----------- ----------- Total assets $1,772,654 $1,727,268 $1,619,989 Cash and cash equivalents 70,640 41,474 74,523 Investment securities 47,340 52,796 58,736 Loans, net of unearned interest 1,539,629 1,493,878 1,378,642 Allowance for loan losses 22,302 21,616 19,739 Deposits 1,332,505 1,242,810 1,295,879 Shareholders' equity 184,471 181,659 168,021 Tangible shareholders' equity (1) 145,931 142,848 128,399 Book value per share 18.80 18.54 17.20 Tangible book value per share (1) 14.87 14.58 13.15 (1) Tangible shareholders' equity is shareholders' equity less goodwill and intangible assets. GREENE COUNTY BANCSHARES, INC. Condensed Consolidated Balance Sheets December 31, 2006 and December 31, 2005 (Dollars in thousands except share and per share data) (Unaudited) December 31, December 31, 2006 2005 (1) ------------ ------------ ASSETS ------------------------------------------ Cash and due from banks $ 44,657 $ 46,136 Federal funds sold & other 25,983 28,387 Securities available-for-sale ("AFS") 37,740 48,868 Securities held-to-maturity (with a market value of $2,544 and $3,335 on December 31, 2006 and December 31, 2005) 2,545 3,379 FHLB, Bankers Bank and other stock, at cost 7,055 6,489 Loans held for sale 1,772 2,686 Loans, net of unearned interest 1,539,629 1,378,642 Allowance for loan losses (22,302) (19,739) Bank premises and equipment, net of accumulated depreciation 57,258 49,985 Goodwill and other intangible assets 38,540 39,622 Other assets 39,777 35,534 ------------ ------------ Total Assets $ 1,772,654 $ 1,619,989 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY ------------------------------------------ Deposits $ 1,332,505 $ 1,295,879 Federal funds purchased 20,000 - Repurchase agreements 22,165 17,498 FHLB advances and notes payable 177,571 105,146 Subordinated debentures 13,403 13,403 Accrued interest payable and other liabilities 22,539 20,042 ------------ ------------ Total Liabilities 1,588,183 1,451,968 ------------ ------------ SHAREHOLDERS' EQUITY ------------------------------------------ Common Stock: $2 par value, 15,000,000 shares authorized; 9,810,867 and 9,766,336 shares outstanding 19,622 19,533 Paid in Capital 71,828 70,700 Retained Earnings 93,150 78,158 Accumulated Other Comprehensive Income (Loss) (129) (370) ------------ ------------ Total Shareholders' Equity 184,471 168,021 ------------ ------------ Total Liabilities & Shareholders' Equity $ 1,772,654 $ 1,619,989 ============ ============ (1) Derived from Audited Consolidated Financial Statements. GREENE COUNTY BANCSHARES, INC. Condensed Consolidated Statements of Income and Comprehensive Income Three Months Ended December 31, 2006, September 30, 2006 and December 31, 2006 and Twelve Months Ended December 31, 2006 and 2005 (Unaudited) (Dollars in thousands except share and per share data) Three Months Ended ----------------------------------------- December 31, September 30, December 31, 2006 2006 2005 ------------ ------------- ------------ Interest Income: --------------------------- Interest and Fees on Loans $ 31,012 $ 29,600 $ 24,809 Interest on Investment Securities 694 752 649 Interest on Federal Funds Sold and Interest- earning Deposits 28 15 180 ------------ ------------- ------------ Total Interest Income 31,734 30,367 25,638 ------------ ------------- ------------ Interest Expense: --------------------------- Interest on Deposits 10,573 8,828 7,433 Interest on Borrowings 2,693 3,009 1,366 ------------ ------------- ------------ Total Interest Expense 13,266 11,837 8,799 ------------ ------------- ------------ Net Interest Income 18,468 18,530 16,839 Provision for Loan Losses 1,538 1,661 1,979 ------------ ------------- ------------ Net Interest Income after Provision for Loan Losses 16,930 16,869 14,860 ------------ ------------- ------------ Noninterest Income: --------------------------- Service Charges, Commissions and Fees 4,805 4,125 3,546 Other Income 999 1,066 775 ------------ ------------- ------------ Total Noninterest Income 5,804 5,191 4,321 ------------ ------------- ------------ Noninterest Expense: --------------------------- Salaries and Benefits 6,883 6,768 6,475 Occupancy and Furniture and Equipment Expense 2,084 2,046 1,939 Other Expenses 5,288 4,322 4,538 ------------ ------------- ------------ Total Noninterest Expense 14,255 13,136 12,952 ------------ ------------- ------------ Income Before Income Taxes 8,479 8,924 6,229 Income Taxes 3,305 3,415 2,391 ------------ ------------- ------------ Net Income $ 5,174 $ 5,509 $ 3,838 ============ ============= ============ Comprehensive Income $ 5,244 $ 5,672 $ 3,627 ============ ============= ============ Per Share of Common Stock: --------------------------- Basic Earnings $0.53 $0.56 $0.40 ============ ============= ============ Diluted Earnings $0.52 $0.56 $0.39 ============ ============= ============ Dividends $0.28 $0.12 $0.26 ============ ============= ============ Weighted Average Shares Outstanding: --------------------------- Basic 9,805,065 9,790,058 9,709,731 ============ ============= ============ Diluted 9,942,078 9,900,396 9,799,609 ============ ============= ============ Twelve Months Ended -------------------------- December 31, December 31, 2006 2005 ------------ ------------ Interest Income: --------------------------- Interest and Fees on Loans $ 114,493 $ 84,074 Interest on Investment Securities 2,726 2,340 Interest on Federal Funds Sold and Interest- earning Deposits 138 777 ------------ ------------ Total Interest Income 117,357 87,191 ------------ ------------ Interest Expense: --------------------------- Interest on Deposits 36,090 23,481 Interest on Borrowings 9,310 4,924 ------------ ------------ Total Interest Expense 45,400 28,405 ------------ ------------ Net Interest Income 71,957 58,786 Provision for Loan Losses 5,507 6,365 ------------ ------------ Net Interest Income after Provision for Loan Losses 66,450 52,421 ------------ ------------ Noninterest Income: --------------------------- Service Charges, Commissions and Fees 16,162 11,683 Other Income 4,616 3,073 ------------ ------------ Total Noninterest Income 20,778 14,756 ------------ ------------ Noninterest Expense: --------------------------- Salaries and Benefits 26,308 22,185 Occupancy and Furniture and Equipment Expense 8,239 7,273 Other Expenses 18,229 14,882 ------------ ------------ Total Noninterest Expense 52,776 44,340 ------------ ------------ Income Before Income Taxes 34,452 22,837 Income Taxes 13,190 8,674 ------------ ------------ Net Income $ 21,262 $ 14,163 ============ ============ Comprehensive Income $ 21,503 $ 13,820 ============ ============ Per Share of Common Stock: --------------------------- Basic Earnings $2.17 $1.73 ============ ============ Diluted Earnings $2.14 $1.71 ============ ============ Dividends $0.64 $0.62 ============ ============ Weighted Average Shares Outstanding: --------------------------- Basic 9,788,004 8,184,499 ============ ============ Diluted 9,933,278 8,276,133 ============ ============ GREENE COUNTY BANCSHARES, INC. Consolidated Financial Highlights (UNAUDITED) (Dollars in thousands except share and per share data) December 31, December 31, % 2006 2005 Change ------------ ------------ ------- Financial Condition Data: ---------------------------- Assets $ 1,772,654 $ 1,619,989 9.42% Loans, net of unearned interest 1,539,629 1,378,642 11.68% Cash and investments 91,997 104,872 -12.28% Federal funds sold 25,983 28,387 -8.47% Deposits 1,332,505 1,295,879 2.83% Federal funds purchased 20,000 - - FHLB advances and notes payable 177,571 105,146 68.88% Subordinated debentures 13,403 13,403 0.00% Federal funds purchased and repurchase agreements 22,165 17,498 26.67% Shareholders' equity 184,471 168,021 9.79% Tangible shareholders' equity (1) 145,931 128,399 13.65% Ratios: ---------------------------- Book value per share $18.80 $17.20 9.30% Tangible book value per share (1) $14.87 $13.15 13.08% Average equity to average assets 10.78% 9.20% 17.17% Dividend payout ratio 29.91%(2) 36.26%(2) -17.52% (1) Tangible shareholders' equity is shareholders' equity less goodwill and intangible assets. (2) Includes special dividend of $.16 and $.14 per share paid in December 2006 and 2005, respectively. Three Months Ended December 31, ---------------------- 2006 2005 % Change ---------- ---------- --------- Operating Data: ------------------------------------ Total Interest Income $ 31,734 $ 25,638 23.78% Total Interest Expense 13,266 8,799 50.77% ---------- ---------- --------- Net Interest Income 18,468 16,839 9.67% Provision for Loan Losses 1,538 1,979 -22.28% ---------- ---------- --------- Net Interest Income After Provision for Loan Losses 16,930 14,860 13.93% Non-Interest Income 5,804 4,321 34.32% Non-Interest Expense 14,255 12,952 10.06% ---------- ---------- --------- Income Before Income Taxes 8,479 6,229 36.12% ---------- ---------- --------- Income Tax Expense 3,305 2,391 38.23% ---------- ---------- --------- Net Income $ 5,174 $ 3,838 34.81% ========== ========== ========= Comprehensive Income $ 5,244 $ 3,627 44.58% ========== ========== ========= Per Share of Common Stock: ------------------------------------ Basic Earnings $0.53 $0.40 32.50% ========== ========== ========= Diluted Earnings $0.52 $0.39 33.33% ========== ========== ========= Dividends $0.28 $0.26 7.69% ========== ========== ========= Weighted Average Shares Outstanding: ------------------------------------ Basic 9,805,065 9,709,731 ========== ========== Diluted 9,942,078 9,799,609 ========== ========== Twelve Months Ended December 31, ---------------------- 2006 2005 % Change ---------- ---------- --------- Operating Data: ----------------------------------- Total Interest Income $ 117,357 $ 87,191 34.60% Total Interest Expense 45,400 28,405 59.83% ---------- ---------- --------- Net Interest Income 71,957 58,786 22.40% Provision for Loan Losses 5,507 6,365 -13.48% ---------- ---------- --------- Net Interest Income After Provision for Loan Losses 66,450 52,421 26.76% Non-Interest Income 20,778 14,756 40.81% Non-Interest Expense 52,776 44,340 19.03% ---------- ---------- --------- Income Before Income Taxes 34,452 22,837 50.86% ---------- ---------- --------- Income Tax Expense 13,190 8,674 52.06% ---------- ---------- --------- Net Income $ 21,262 $ 14,163 50.12% ========== ========== ========= Comprehensive Income $ 21,503 $ 13,820 55.59% ========== ========== ========= Per Share of Common Stock: ----------------------------------- Basic Earnings $2.17 $1.73 25.43% ========== ========== ========= Diluted Earnings $2.14 $1.71 25.15% ========== ========== ========= Dividends $0.64 $0.62 3.23% ========== ========== ========= Weighted Average Shares Outstanding: ----------------------------------- Basic 9,788,004 8,184,499 ========== ========== Diluted 9,933,278 8,276,133 ========== ========== Three Months Ended ---------------------------------------- December 31, September 30, December 31, 2006 2006 2005 ------------ ------------- ------------ Key Financial Ratios: ----------------------------- Return on Average Assets 1.20% 1.32% 0.98% Return on Average Shareholders' Equity 11.16% 12.22% 9.10% Return on Average Tangible Shareholders' Equity (1) 14.10% 15.59% 11.65% Interest Rate Spread 4.16% 4.35% 4.29% Net Interest Margin 4.66% 4.83% 4.67% Efficiency Ratio 58.73% 55.38% 61.21% Twelve Months Ended December 31, ------------------- 2006 2005 --------- ------ Key Financial Ratios: ------------------------------------------------ Return on Average Assets 1.28% 1.02% Return on Average Shareholders' Equity 11.91% 11.09% Return on Average Tangible Shareholders' Equity (1) 15.25% 14.04% Interest Rate Spread 4.32% 4.30% Net Interest Margin 4.77% 4.61% Efficiency Ratio 56.91% 60.29% (1) Tangible shareholders' equity is shareholders' equity less goodwill and intangible assets. December 31, September 30, December 31, 2006 2006 2005 ------------ ------------- ------------ Asset Quality Ratios: ----------------------------- Nonperforming Loans as a Percentage of Total Loans, net of Unearned Income 0.23% 0.33% 0.49% Nonperforming Assets as a Percentage of Total Assets 0.29% 0.42% 0.65% Allowance for Loan Losses as a Percentage of Total Loans, net of Unearned Income 1.45% 1.45% 1.43% Allowance for Loan Losses as a Percentage of Nonperforming Loans 635.93% 442.23% 293.56% Net Charge-Offs to Average Total Loans, Net of Unearned Income 0.20% 0.20% 0.32% GREENE COUNTY BANCSHARES, INC. Consolidated Financial Highlights December 31, 2006 (UNAUDITED) Nonperforming Assets and Net Charge-offs --------------------------------------------- As of and for the three months ended December 31, 2006 Bank Other Total --------------------------------------------- ------ ------ ------- Loans past due 90 days and still accruing $ 15 $ 13 $ 28 Nonaccrual loans 2,866 613 3,479 Other real estate owned and repossessed assets 1,336 352 1,688 ------ ------ ------- Total nonperforming assets $4,217 $ 978 $ 5,195 ====== ====== ======= YTD annualized net charge-offs $2,041 $ 903 $ 2,944 ====== ====== ======= As of and for the year ended December 31, 2005 Bank Other Total --------------------------------------------- ------ ------ ------- Loans past due 90 days and still accruing $ 809 $ - $ 809 Nonaccrual loans 5,393 522 5,915 Other real estate owned and repossessed assets 3,396 347 3,743 ------ ------ ------- Total nonperforming assets $9,598 $ 869 $10,467 ====== ====== ======= Net charge-offs $2,490 $1,324 $ 3,814 ====== ====== ======= Asset Quality Ratios ----------------------------------------- As of and for the three months ended December 31, 2006 Bank Other Consolidated ----------------------------------------- ------- ------- ------------ Nonperforming loans as a percentage of total loans, net of unearned income 0.19% 1.84% 0.23% Nonperforming assets as a percentage of total assets 0.24% 2.53% 0.29% Allowance for loan losses as a percentage of total loans, net of unearned income 1.28% 7.94% 1.45% Allowance for loan losses as a percentage of nonperforming loans 680.25% 431.95% 635.93% YTD annualized net charge-offs to average total loans, net of unearned income 0.14% 2.82% 0.20% As of and for the year ended December 31, 2005 Bank Other Consolidated ----------------------------------------- ------- ------- ------------ Nonperforming loans as a percentage of total loans, net of unearned income 0.45% 1.68% 0.49% Nonperforming assets as a percentage of total assets 0.59% 2.37% 0.65% Allowance for loan losses as a percentage of total loans, net of unearned income 1.26% 7.89% 1.43% Allowance for loan losses as a percentage of nonperforming loans 278.65% 470.69% 293.56% Net charge-offs to average total loans, net of unearned income 0.21% 4.22% 0.32% GREENE COUNTY BANCSHARES, INC. Condensed Average Balances, Interest Rates and Yields December 31, 2006 Three Months Ended December 31, ------------------------------------------------------- 2006 2005 --------------------------- --------------------------- Average Average Average Average Balance Interest Rate Balance Interest Rate ---------- -------- ------- ---------- -------- ------- Interest- earning assets: -------------- Loans 1,516,804 31,012 8.11% 1,350,357 24,809 7.29% Investment securities 52,389 694 5.26% 60,301 649 4.27% Other short- term investments 2,207 28 5.03% 18,597 180 3.84% ---------- -------- ------- ---------- -------- ------- Total interest- earning assets 1,571,400 31,734 8.01% 1,429,255 25,638 7.12% ---------- -------- ------- ---------- -------- ------- Non-interest earning assets 151,121 140,186 ---------- ---------- Total assets 1,722,521 1,569,441 ========== ========== Interest- bearing liabilities: -------------- Deposits: -------------- Now accounts, money market and savings 479,498 2,821 2.33% 496,629 2,178 1.74% Time deposits 684,410 7,752 4.49% 630,787 5,255 3.31% ---------- -------- ------- ---------- -------- ------- Total interest bearing- deposits 1,163,908 10,573 3.60% 1,127,416 7,433 2.62% ---------- -------- ------- ---------- -------- ------- Securities sold under repurchase and short- term borrowings 30,504 334 4.34% 15,840 132 3.31% Notes payable 171,853 2,359 5.45% 92,657 1,234 5.28% ---------- -------- ------- ---------- -------- ------- Total interest- bearing liabilities 1,366,265 13,266 3.85% 1,235,913 8,799 2.83% ---------- -------- ------- ---------- -------- ------- Non-Interest Bearing Liabilities: -------------- Demand Deposits 150,609 146,261 Other Liabilities 20,194 18,647 ---------- ---------- Total Non- Interest Bearing Liabilities 170,803 164,908 ---------- ---------- Total liabilities 1,537,068 1,400,821 ---------- ---------- Shareholders' equity 185,453 168,620 Total liabilities & shareholders' equity 1,722,521 1,569,441 ========== ========== Net interest income 18,468 16,839 ======== ======== Interest rate spread 4.16% 4.29% ======= ======= Net yield on interest- earning assets (net interest margin) 4.66% 4.67% ======= ======= Twelve Months Ended December 31, ------------------------------------------------------- 2006 2005 --------------------------- --------------------------- Average Average Average Average Balance Interest Rate Balance Interest Rate ---------- -------- ------- ---------- -------- ------- Interest- earning assets: -------------- Loans 1,450,516 114,493 7.89% 1,191,077 84,074 7.06% Investment securities 55,152 2,726 4.94% 58,750 2,340 3.98% Other short- term investments 2,799 138 4.93% 25,964 777 2.99% ---------- -------- ------- ---------- -------- ------- Total interest- earning assets 1,508,467 117,357 7.78% 1,275,791 87,191 6.84% ---------- -------- ------- ---------- -------- ------- Non-interest earning assets 148,311 112,805 ---------- ---------- Total assets 1,656,778 1,388,596 ========== ========== Interest- bearing liabilities: -------------- Deposits: -------------- Now accounts, money market and savings 493,019 10,524 2.13% 423,619 5,654 1.33% Time deposits 641,672 25,566 3.98% 591,608 17,827 3.01% ---------- -------- ------- ---------- -------- ------- Total interest bearing- deposits 1,134,691 36,090 3.18% 1,015,227 23,481 2.31% ---------- -------- ------- ---------- -------- ------- Securities sold under repurchase and short- term borrowings 32,487 1,469 4.52% 15,695 414 2.64% Notes payable 144,155 7,841 5.44% 89,429 4,510 5.04% ---------- -------- ------- ---------- -------- ------- Total interest- bearing liabilities 1,311,333 45,400 3.46% 1,120,351 28,405 2.54% ---------- -------- ------- ---------- -------- ------- Non-Interest Bearing Liabilities: -------------- Demand Deposits 147,947 125,071 Other Liabilities 18,952 15,460 ---------- ---------- Total Non- Interest Bearing Liabilities 166,899 140,531 ---------- ---------- Total liabilities 1,478,232 1,260,882 ---------- ---------- Shareholders' equity 178,546 127,714 Total liabilities & shareholders' equity 1,656,778 1,388,596 ========== ========== Net interest income 71,957 58,786 ======== ======== Interest rate spread 4.32% 4.30% ======= ======= Net yield on interest- earning assets (net interest margin) 4.77% 4.61% ======= ======= GREENE COUNTY BANCSHARES, INC. Consolidated Financial Highlights December 31, 2006 (UNAUDITED) December 31, 2006 December 31, 2005 ------------------ ------------------ Loans Balance % Balance % % Change ------------------- ---------- ------- ---------- ------- --------- Commercial $ 258,998 16.70% $ 245,285 17.67% 5.59% Commercial real estate 921,190 59.38% 729,254 52.52% 26.32% Residential real estate 281,629 18.16% 319,797 23.03% -11.94% Consumer 87,111 5.62% 90,682 6.53% -3.94% Other 2,203 0.14% 3,476 0.25% -36.62% ---------- ------- ---------- ------- --------- 1,551,131 100.00% 1,388,494 100.00% 11.71% ======= ======= ========= Less: Unearned interest income (11,502) (9,852) ---------- ---------- Total $1,539,629 $1,378,642 ========== ========== Loan Balances by Banking Units and Operating Subsidiaries --------------------------------------- December 31, 2006 December 31, 2005 ------------------ ------------------ % to % to Loan Total Loan Total Balance Loans Balance Loans % Change ---------- ------- ---------- ------- --------- Greene County Bank $ 105,452 6.85% $ 113,213 8.21% -6.86% American Fidelity Bank 529,379 34.38% 447,261 32.46% 18.36% Bank of Athens 50,349 3.27% 46,744 3.39% 7.71% Bank of Bulls Gap 4,972 0.32% 5,273 0.38% -5.71% Bank of Niota 7,847 0.51% 10,478 0.76% -25.11% Clarksville Community Bank 105,463 6.85% 107,660 7.81% -2.04% Cocke County Bank 6,579 0.43% 6,021 0.44% 9.27% Community Bank of Loudon County 30,753 2.00% 23,362 1.69% 31.64% Community Trust Bank 7,304 0.47% 9,937 0.72% -26.50% First Bristol Bank 61,912 4.02% 57,661 4.18% 7.37% First Independent Bank 58,745 3.82% 65,391 4.74% -10.16% Hamblen County Bank 45,986 2.99% 48,944 3.55% -6.04% Hawkins County Bank 32,528 2.11% 31,887 2.31% 2.01% Bank of Lawrence County 22,904 1.49% 24,222 1.76% -5.44% Middle Tennessee Bank and Trust 131,819 8.56% 87,351 6.34% 50.91% Rutherford Bank and Trust 95,448 6.20% 83,590 6.06% 14.19% Sullivan County Bank 14,677 0.95% 16,865 1.22% -12.97% Washington County Bank 193,461 12.57% 161,643 11.72% 19.68% GCB Acceptance Corporation 13,444 0.87% 12,140 0.88% 10.74% Superior Financial Services, Inc. 20,607 1.34% 18,999 1.38% 8.46% ---------- ------- ---------- ------- --------- Totals $1,539,629 100.00% $1,378,642 100.00% 11.68% ========== ======= ========== ======= ========= ---------------------------------------------------------------------- ---------------------------------------------------------------------- December 31, 2006 December 31, 2005 ------------------ ------------------ Deposits Balance % Balance % % Change ------------------- ---------- ------- ---------- ------- --------- Non-interest bearing demand $ 152,634 11.45% $ 144,216 11.13% 5.84% Interest bearing demand 304,828 22.88% 268,714 20.74% 13.44% Money market and savings 194,068 14.56% 245,740 18.96% -21.03% Retail time 445,816 33.46% 425,506 32.83% 4.77% Jumbo time 235,159 17.65% 211,703 16.34% 11.08% ---------- ------- ---------- ------- --------- Total $1,332,505 100.00% $1,295,879 100.00% 2.83% ========== ======= ========== ======= ========= Deposit Balances by Banking Units and Operating Subsidiaries --------------------------------------- December 31, 2006 December 31, 2005 ------------------ ------------------ Balance % Balance % % Change ---------- ------- ---------- ------- --------- Greene County Bank $ 331,301 24.88% $ 322,396 24.90% 2.76% American Fidelity Bank 204,673 15.36% 184,874 14.27% 10.71% Bank of Athens 28,896 2.17% 26,280 2.03% 9.95% Bank of Bulls Gap 17,789 1.34% 16,181 1.25% 9.94% Bank of Niota 17,092 1.28% 16,237 1.25% 5.27% Clarksville Community Bank 154,967 11.63% 169,032 13.04% -8.32% Cocke County Bank 32,612 2.45% 28,314 2.18% 15.18% Community Bank of Loudon County 25,452 1.91% 24,507 1.89% 3.86% Community Trust Bank 4,981 0.37% 6,539 0.50% -23.83% First Bristol Bank 34,784 2.61% 47,351 3.65% -26.54% First Independent Bank 96,934 7.27% 101,071 7.80% -4.09% Hamblen County Bank 62,202 4.67% 52,998 4.09% 17.37% Hawkins County Bank 45,234 3.39% 47,484 3.66% -4.74% Bank of Lawrence County 74,135 5.56% 70,519 5.44% 5.13% Middle Tennessee Bank and Trust 59,356 4.45% 38,919 3.00% 52.51% Rutherford Bank and Trust 52,762 3.96% 51,903 4.01% 1.66% Sullivan County Bank 13,184 0.99% 13,671 1.05% -3.56% Washington County Bank 76,151 5.71% 77,603 5.99% -1.87% GCB Acceptance Corporation - 0.00% - 0.00% - Superior Financial Services, Inc. - 0.00% - 0.00% - ---------- ------- ---------- ------- --------- $1,332,505 100.00% $1,295,879 100.00% 2.83% ========== ======= ========== ======= ========= CONTACT: Greene County Bancshares, Inc. James E. Adams, 423-278-3050 Senior Vice President and Chief Financial Officer