-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EToXrhve6zQ+qXmdjQ6c4WNJkEIvXTmrAbcUabUmNDl3vgj4tjqNdFwRZXj3COHH /zg5fSHCbKdlU2D9KXnE3Q== 0001157523-07-003516.txt : 20070413 0001157523-07-003516.hdr.sgml : 20070413 20070412182856 ACCESSION NUMBER: 0001157523-07-003516 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20070412 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20070413 DATE AS OF CHANGE: 20070412 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GREENE COUNTY BANCSHARES INC CENTRAL INDEX KEY: 0000764402 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 621222567 STATE OF INCORPORATION: TN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-14289 FILM NUMBER: 07764385 BUSINESS ADDRESS: STREET 1: 100 NORTH MAIN STREET CITY: GREENEVILLE STATE: TN ZIP: 37743-4992 BUSINESS PHONE: 4236395111 MAIL ADDRESS: STREET 1: P O BOX 1120 CITY: GREENEVILLE STATE: TN ZIP: 37744-1120 8-K 1 a5376327.txt GREENE COUNTY BANCSHARES, INC. 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): April 12, 2007 GREENE COUNTY BANCSHARES, INC. ------------------------------ (Exact name of Registrant as specified in its charter) Tennessee 0-14289 62-1222567 --------- ------- ---------- (State or Other Jurisdiction (Commission (I.R.S. Employer of Incorporation) File Number) Identification No.) 100 North Main Street, Greeneville, Tennessee 37743-4992 -------------------------------------------------------- (Address of principal executive offices) (423) 639-5111 --------------- Registrant's telephone number, including area code 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: |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On April 12, 2007, Greene County Bancshares, Inc. (the "Company") announced its financial results for the first quarter ended March 31, 2007. The full text of the press release is set forth in Exhibit 99.1 hereto. The information in this Form 8-K and the attached Exhibit is being furnished pursuant to Item 2.02 "Results of Operations and Financial Condition" and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. ITEM 7.01. REGULATION FD DISCLOSURE. On April 12, 2007, the Company announced its financial results for the first quarter ended March 31, 2007. The full text of the press release is set forth in Exhibit 99.1 hereto. The information in this Form 8-K and the attached Exhibit is being furnished pursuant to Item 7.01 "Regulation FD Disclosure" and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS. (d) Exhibits. 99.1 Press Release dated April 12, 2007 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. GREENE COUNTY BANCSHARES, INC. Date: April 13, 2007 By: /s/ James E. Adams -------------------------------- James E. Adams Senior Vice President and Chief Financial Officer (Duly Authorized Representative) EXHIBIT INDEX Exhibit Number Description of Exhibit(s) - ------ ------------------------- 99.1 Copy of press release issued by the Company on April 12, 2007. EX-99.1 2 a5376327ex991.txt EXHIBIT 99.1 Exhibit 99.1 Greene County Bancshares Reports Record Quarterly Earnings, up 10%, and Continued Strong Loan Growth GREENEVILLE, Tenn.--(BUSINESS WIRE)--April 12, 2007--Greene County Bancshares, Inc. (NASDAQ: GCBS) today announced higher earnings and solid operating results for the first quarter ended March 31, 2007. Net income increased to $5,616,000 or $0.57 per diluted share, up 10% from $5,096,000 or $0.52 per diluted share in the first quarter of 2006. Balance sheet highlights included strong organic growth in the Company's loan portfolio, continued improvement in credit quality, and higher deposits. Return on Average Assets (ROA) was 1.26% in the first quarter of 2007 compared with 1.20% in the fourth quarter of 2006 and 1.27% in the year-earlier quarter. Return on Average Equity (ROE) increased to 11.93% in the first quarter of 2007, up from 11.16% in the fourth quarter of 2006 and 11.86% in the year-earlier period. Return on Average Tangible Equity (ROTE) (average shareholders' equity less goodwill and intangible assets) was 14.99% in the first quarter of 2007 versus 14.10% in the fourth quarter of 2006 and 15.41% last year. Commenting on the Company's announcement, Stan Puckett, Chairman and Chief Executive Officer, said, "We are very pleased to report a solid start in 2007, maintaining the momentum we achieved last year. Key drivers for our financial success in the first quarter included continued improvement in our credit quality, outstanding loan growth, and higher non-interest income. Strategically, we announced and implemented the rebranding of all of our banking operations under the GreenBank name - a change that has been well accepted by our customers, and we are enthusiastic about the value this action will bring to our company in the months and years ahead. On the other hand, we had hoped to achieve greater efficiencies in our operations during the quarter and make better headway in improving our efficiency ratio, which remains a priority for us. Recently, we took further steps to reduce non-interest expense going forward, and we hope to see tangible results from these efforts later in the year." Net interest income for the first quarter increased by almost 10% to $18,821,000 from $17,186,000 in the year-earlier period, driven by a 13% increase in average loans outstanding between the periods. On a linked-quarter basis, the Company's net interest margin improved four basis points to 4.70% in the first quarter of 2007, while, on a year-over-year basis, net interest margin declined 10 basis points from 4.80% in the first quarter of 2006, reflecting a changing and challenging interest rate environment. The Company's provision for loan losses was $974,000 in the first quarter of 2007, down from $1,064,000 in the first quarter of last year as a result of ongoing improvements in asset quality. Non-interest income increased 14% in the first quarter to $5,399,000 from $4,755,000 in the same quarter last year. This advance reflected the ongoing positive impact of the Company's High Performance Checking Account product - a key strategic initiative. First quarter "net" new checking accounts opened totaled 4,025 compared with 2,996 during the same quarter last year, an increase of over 34%. Non-interest expenses totaled $14,042,000 in the first quarter, up $1,336,000 or 11% over $12,706,000 in the same period a year ago. The Company's efficiency ratio improved 75 basis points to 57.98% in the first quarter from 58.73% in the fourth quarter of 2006, and was 43 basis points higher versus 57.55% in the first quarter of 2006 due to continued expansion initiatives throughout 2006. Puckett concluded, "Outside the financial and operational success we registered in the first quarter, the most important event for the Company was the announcement of the proposed acquisition of Civitas BankGroup, through which we will acquire Civitas and its 12 Middle Tennessee branches. We expect that this merger, which should be completed later in the second quarter, will add significant momentum to our expansion efforts in the Nashville Metropolitan Statistical Area and position us for further growth in this fast-growing market." At March 31, 2007, the Company's total assets increased 14% to $1,827,634,000 from $1,608,240,000 at March 31, 2006, and up 3% from $1,772,654,000 at December 31, 2006. Net loans increased 14% to $1,603,281,000 at March 31, 2007, from $1,404,627,000 at March 31, 2006, and up 4% from $1,539,629,000 at December 31, 2006. Deposits rose 8% to $1,390,442,000 at March 31, 2007, from $1,285,738,000 at March 31, 2006, and up 4% from $1,332,505,000 at December 31, 2006. Total shareholders' equity increased 10% to $189,997,000 at March 31, 2007, versus $172,317,000 at March 31, 2006, and up 3% from $184,471,000 at December 31, 2006. Greeneville, Tennessee-based Greene County Bancshares, Inc., with total assets of approximately $1.8 billion, is the holding company for GreenBank. GreenBank, which traces its origin to 1890, has 49 branches throughout East and Middle Tennessee, one branch each in Bristol, Virginia, and Hot Springs, North Carolina, and a wealth management office in Gallatin, Tennessee. In addition, GreenBank 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 automobile lending; and Fairway Title Co., a title insurance company. This communication is not a solicitation of a proxy from any security holder of Greene County Bancshares, Inc. or Civitas BankGroup, Inc. In connection with the proposed acquisition of Civitas BankGroup, Greene County Bancshares has filed with the Securities and Exchange Commission ("SEC") a registration statement on Form S-4 to register the shares of Green County Bancshares common stock to be issued to the shareholders of Civitas BankGroup. The registration statement includes a joint proxy statement/prospectus and other documents for the shareholders' meetings of Civitas BankGroup and Greene County Bancshares at which time the proposed merger will be considered. The registration statement and joint proxy statement/prospectus contain important information about Greene County, Civitas, the proposed merger and related matters. Additional Information and Where to Find It INVESTORS AND SECURITY HOLDERS ARE ENCOURAGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS WHEN IT BECOMES AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED TRANSACTION BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT GREENE COUNTY BANCSHARES, CIVITAS BANKGROUP AND THE PROPOSED TRANSACTION. Investors and security holders may obtain free copies of these documents once they are available through the website maintained by the SEC at www.sec.gov. Free copies of the joint proxy statement/prospectus also may be obtained by directing a request by telephone or mail to: Greene County Bancshares, Inc. Civitas BankGroup, Inc. 100 North Main Street 4 Corporate Centre Greeneville, TN 37743-4992 810 Crescent Centre Drive, Suite 320 Attention: Chief Financial Franklin, TN 37067 Officer Attention: Investor Relations (423) 639-5111 (615) 263-9500 This communication shall not constitute an offer to sell or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. Participants in the Solicitation The directors and executive officers of Greene County and Civitas may be deemed to be participants in the solicitation of proxies with respect to the proposed transaction. Information about Greene County's directors and executive officers is contained in the proxy statement filed by Greene County with the SEC on March 27, 2006, which is available on Greene County's web site www.greenbankusa.com and at the address provided above. Information about Civitas' directors and executive officers is contained in the proxy statement filed by Civitas with the SEC on March 29, 2006, which is available on Civitas' website www.civitasbankgroup.com. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests by security holding or otherwise, will be contained in the joint proxy statement/prospectus and other relevant material to be filed with the SEC when they become available. All statements, other than statements of historical fact included in this release, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "expect," "anticipate," "intend," "plan," "believe," "seek," "estimate" and similar expressions are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking including statements about the benefits of the merger to Greene County Bancshares and Civitas BankGroup, future financial and operating results and Greene County Bancshares's plans, objectives and intentions. All forward-looking statements are subject to risks, uncertainties and other facts that may cause the actual results, performance or achievements of Greene County Bancshares to differ materially from any results expressed or implied by such forward-looking statements. Such factors include, among others, the risk that the cost savings and any revenue synergies from the merger may be realized or take longer than anticipated, disruption from the merger with customers, suppliers or employee relationships, the risk of successful integration of the two businesses, the failure of Civitas BankGroup or Greene County Bancshares shareholders to approve the merger and the ability to obtain required governmental approvals of the proposed terms and anticipated schedule. Additional factors which could affect the forward-looking statements can be found in the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K of both Greene County Bancshares and Civitas BankGroup filed or furnished with the Securities and Exchange Commission and available on the Commission's website set forth above. Greene County Bancshares and Civitas BankGroup disclaim any obligation to update or revise any forward-looking statements contained in this release, whether as a result of new information, future events or otherwise. GREENE COUNTY BANCSHARES, INC. Unaudited Financial Highlights (In thousands, except per share amounts) Three Months Ended ------------------------------------ March 31, Dec. 31, March 31, 2007 2006 2006 ------------ ----------- ----------- Interest income $32,638 $31,734 $26,767 Interest expense 13,817 13,266 9,581 ------------ ----------- ----------- Net interest income 18,821 18,468 17,186 Provision for loan losses 974 1,538 1,064 ------------ ----------- ----------- Net interest income after provision for loan losses 17,847 16,930 16,122 Non-interest income 5,399 5,804 4,755 Non-interest expense 14,042 14,255 12,706 ------------ ----------- ----------- Income before income taxes 9,204 8,479 8,171 Income taxes 3,588 3,305 3,075 ------------ ----------- ----------- Net income $5,616 $5,174 $5,096 ============ =========== =========== Comprehensive income $5,657 $5,244 $5,089 ============ =========== =========== Earnings per share: Basic $0.57 $0.53 $0.52 ============ =========== =========== Diluted $0.57 $0.52 $0.52 ============ =========== =========== Weighted average shares: Basic 9,815 9,805 9,771 ============ =========== =========== Diluted 9,910 9,942 9,871 ============ =========== =========== Dividends declared per share $0.13 $0.28 $0.12 ============ =========== =========== March 31, Dec. 31, March 31, 2007 2006 2006 ------------ ----------- ----------- Total assets $1,827,634 $1,772,654 $1,608,240 Cash and cash equivalents 54,798 70,640 40,530 Investment securities 54,286 47,340 54,155 Loans, net of unearned interest 1,603,281 1,539,629 1,404,627 Allowance for loan losses 22,932 22,302 20,083 Deposits 1,390,442 1,332,505 1,285,738 Shareholders' equity 189,997 184,471 172,317 Tangible shareholders' equity (1) 151,727 145,931 132,965 Book value per share 19.35 18.80 17.62 Tangible book value per share (1) 15.45 14.87 13.59 (1) Tangible shareholders' equity is shareholders' equity less goodwill and intangible assets. GREENE COUNTY BANCSHARES, INC. Condensed Consolidated Balance Sheets March 31, 2007, December 31, 2006 and March 31, 2006 (Dollars in thousands except share and per share data) (Unaudited) (Unaudited) March 31, December 31, March 31, 2007 2006(1) 2006 ----------- ------------ ----------- ASSETS --------------------------------- Cash and due from banks $34,729 $44,657 $39,189 Federal funds sold & other 20,069 25,983 1,341 Securities available-for-sale ("AFS") 45,587 37,740 44,311 Securities held-to-maturity (with a market value of $1,640, $2,544 and $3,003 on March 31, 2007, December 31, 2006 and March 31, 2006) 1,644 2,545 3,049 FHLB, Bankers Bank and other stock, at cost 7,055 7,055 6,795 Loans held for sale 2,405 1,772 1,957 Loans, net of unearned interest 1,603,281 1,539,629 1,404,627 Allowance for loan losses (22,932) (22,302) (20,083) Bank premises and equipment, net of accumulated depreciation 58,722 57,258 52,109 Goodwill and other intangible assets 38,270 38,540 39,352 Other assets 38,804 39,777 35,593 ----------- ------------ ----------- Total Assets $1,827,634 $1,772,654 $1,608,240 =========== ============ =========== LIABILITIES AND SHAREHOLDERS' EQUITY --------------------------------- Deposits $1,390,442 $1,332,505 $1,285,738 Federal funds purchased 17,415 20,000 0 Repurchase agreements 24,157 22,165 17,966 FHLB advances and notes payable 171,877 177,571 97,052 Subordinated debentures 13,403 13,403 13,403 Accrued interest payable and other liabilities 20,343 22,539 21,764 ----------- ------------ ----------- Total Liabilities 1,637,637 1,588,183 1,435,923 ----------- ------------ ----------- SHAREHOLDERS' EQUITY --------------------------------- Common Stock: $2 par value, 15,000,000 shares authorized; 9,819,218, 9,810,867 and 9,781,070 shares outstanding 19,638 19,622 19,562 Paid in Capital 72,156 71,828 71,052 Retained Earnings 98,291 93,150 82,080 Accumulated Other Comprehensive Income (Loss) (88) (129) (377) ----------- ------------ ----------- Total Shareholders' Equity 189,997 184,471 172,317 ----------- ------------ ----------- Total Liabilities & Shareholders' Equity $1,827,634 $1,772,654 $1,608,240 =========== ============ =========== (1) Derived from Audited Consolidated Financial Statements. GREENE COUNTY BANCSHARES, INC. Condensed Consolidated Statements of Income and Comprehensive Income Three Months Ended March 31, 2007, December 31, 2006 and March 31, 2006 (Unaudited) (Dollars in thousands except share and per share data) Three Months Ended -------------------------------- March 31, December March 31, 31, 2007 2006 2006 ---------- ---------- ---------- Interest Income: ------------------------------------ Interest and Fees on Loans $31,915 $31,012 $26,100 Interest on Investment Securities 708 694 631 Interest on Federal Funds Sold and Interest-earning Deposits 15 28 36 ---------- ---------- ---------- Total Interest Income 32,638 31,734 26,767 ---------- ---------- ---------- Interest Expense: ------------------------------------ Interest on Deposits 11,153 10,573 8,042 Interest on Borrowings 2,664 2,693 1,539 ---------- ---------- ---------- Total Interest Expense 13,817 13,266 9,581 ---------- ---------- ---------- Net Interest Income 18,821 18,468 17,186 Provision for Loan Losses 974 1,538 1,064 ---------- ---------- ---------- Net Interest Income after Provision for Loan Losses 17,847 16,930 16,122 ---------- ---------- ---------- Noninterest Income: ------------------------------------ Service Charges, Commissions and Fees 4,289 4,805 3,231 Other Income 1,110 999 1,524 ---------- ---------- ---------- Total Noninterest Income 5,399 5,804 4,755 ---------- ---------- ---------- Noninterest Expense: ------------------------------------ Salaries and Benefits 7,458 6,883 6,391 Occupancy and Furniture and Equipment Expense 2,096 2,084 2,059 Other Expenses 4,488 5,288 4,256 ---------- ---------- ---------- Total Noninterest Expense 14,042 14,255 12,706 ---------- ---------- ---------- Income Before Income Taxes 9,204 8,479 8,171 Income Taxes 3,588 3,305 3,075 ---------- ---------- ---------- Net Income $5,616 $5,174 $5,096 ========== ========== ========== Comprehensive Income $5,657 $5,244 $5,089 ========== ========== ========== Per Share of Common Stock: ------------------------------------ Basic Earnings $0.57 $0.53 $0.52 ========== ========== ========== Diluted Earnings $0.57 $0.52 $0.52 ========== ========== ========== Dividends $0.13 $0.28 $0.12 ========== ========== ========== Weighted Average Shares Outstanding: ------------------------------------ Basic 9,815,452 9,805,065 9,770,555 ========== ========== ========== Diluted 9,910,315 9,942,078 9,870,691 ========== ========== ========== GREENE COUNTY BANCSHARES, INC. Consolidated Financial Highlights (UNAUDITED) (Dollars in thousands except share and per share data) - ---------------------------------------------------------------------- March 31, December 31, % 2007 2006 Change ---------- ------------ --------- Financial Condition Data: - ----------------------------------- Assets $1,827,634 $ 1,772,654 3.10% Loans, net of unearned interest 1,603,281 1,539,629 4.13% Cash and investments 89,015 91,997 -3.24% Federal funds sold 20,069 25,983 -22.76% Deposits 1,390,442 1,332,505 4.35% Federal funds purchased 17,415 20,000 - FHLB advances and notes payable 171,877 177,571 -3.21% Subordinated debentures 13,403 13,403 0.00% Federal funds purchased and repurchase agreements 24,157 22,165 8.99% Shareholders' equity 189,997 184,471 3.00% Tangible shareholders' equity (1) 151,727 145,931 3.97% Ratios: - ----------------------------------- Book value per share $19.35 $18.80 2.93% Tangible book value per share (1) $15.45 $14.87 3.90% Average equity to average assets 10.58% 10.78% -1.86% Dividend payout ratio 22.81% 29.49%(2) -22.67% (1) Tangible shareholders' equity is shareholders' equity less goodwill and intangible assets. (2) Includes special dividend of $.16 per share paid in December 2006. - ---------------------------------------------------------------------- - ---------------------------------------------------------------------- Three Months Ended March 31, ------------------------ 2007 2006 % Change ---------- ------------ --------- Operating Data: - ----------------------------------- Total Interest Income $ 32,638 $ 26,767 21.93% Total Interest Expense 13,817 9,581 44.21% ---------- ------------ --------- Net Interest Income 18,821 17,186 9.51% Provision for Loan Losses 974 1,064 -8.46% ---------- ------------ --------- Net Interest Income After Provision for Loan Losses 17,847 16,122 10.70% Non-Interest Income 5,399 4,755 13.54% Non-Interest Expense 14,042 12,706 10.51% ---------- ------------ --------- Income Before Income Taxes 9,204 8,171 12.64% ---------- ------------ --------- Income Tax Expense 3,588 3,075 16.68% ---------- ------------ --------- Net Income $ 5,616 $ 5,096 10.20% ========== ============ ========= Comprehensive Income $ 5,657 $ 5,089 11.16% ========== ============ ========= Per Share of Common Stock: - ----------------------------------- Basic Earnings $0.57 $0.52 9.62% ========== ============ ========= Diluted Earnings $0.57 $0.52 9.62% ========== ============ ========= Dividends $0.13 $0.12 8.33% ========== ============ ========= Weighted Average Shares Outstanding: - ----------------------------------- Basic 9,815,452 9,770,555 ========== ============ Diluted 9,910,315 9,870,691 ========== ============ - ---------------------------------------------------------------------- - ---------------------------------------------------------------------- Three Months Ended ---------------------------------- March 31, December 31, March 31, 2007 2006 2006 ---------- ------------ --------- Key Financial Ratios: - ----------------------------------- Return on Average Assets 1.26% 1.20% 1.27% Return on Average Shareholders' Equity 11.93% 11.16% 11.86% Return on Average Tangible Shareholders' Equity (1) 14.99% 14.10% 15.41% Interest Rate Spread 4.21% 4.16% 4.42% Net Interest Margin 4.70% 4.66% 4.80% Efficiency Ratio 57.98% 58.73% 57.55% (1) Tangible shareholders' equity is shareholders' equity less goodwill and intangible assets. - ---------------------------------------------------------------------- - ---------------------------------------------------------------------- March 31, December 31, March 31, 2007 2006 2006 ---------- ------------ --------- Asset Quality Ratios: - ----------------------------------- Nonperforming Loans as a Percentage of Total Loans, net of Unearned Income 0.21% 0.23% 0.35% Nonperforming Assets as a Percentage of Total Assets 0.28% 0.29% 0.49% Allowance for Loan Losses as a Percentage of Total Loans, net of Unearned Income 1.43% 1.45% 1.43% Allowance for Loan Losses as a Percentage of Nonperforming Loans 690.10% 635.93% 405.23% Net Charge-Offs to Average Total Loans, Net of Unearned Income 0.09% 0.20% 0.21% GREENE COUNTY BANCSHARES, INC. Consolidated Financial Highlights March 31, 2007 (UNAUDITED) - ---------------------------------------------- ------- ------- ------- Nonperforming Assets and Net Charge-offs --------------------------------------------- As of and for the three months ended March Bank Other Total 31, 2007 --------------------------------------------- ------- ------- ------- Loans past due 90 days and still accruing $27 $10 $37 Nonaccrual loans 2,794 492 3,286 Other real estate owned and repossessed assets 1,585 250 1,835 ------- ------- ------- Total nonperforming assets $4,406 $752 $5,158 ======= ======= ======= YTD annualized net charge-offs $368 $1,004 $1,372 ======= ======= ======= As of and for the three months ended March Bank Other Total 31, 2006 --------------------------------------------- ------- ------- ------- Loans past due 90 days and still accruing $20 $54 $74 Nonaccrual loans 4,590 292 4,882 Other real estate owned and repossessed assets 2,752 244 2,996 ------- ------- ------- Total nonperforming assets $7,362 $590 $7,952 ======= ======= ======= YTD annualized net charge-offs $2,080 $800 $2,880 ======= ======= ======= As of and for the year ended December 31, Bank Other Total 2006 --------------------------------------------- ------- ------- ------- 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 ======= ======= ======= Net charge-offs $2,041 $903 $2,944 ======= ======= ======= Asset Quality Ratios --------------------------------------- As of and for the three months ended Bank Other Consolidated March 31, 2007 ----------------------------------------------- ------- ------------ Nonperforming loans as a percentage of total loans, net of unearned income 0.18% 1.43% 0.21% Nonperforming assets as a percentage of total assets 0.24% 2.04% 0.28% Allowance for loan losses as a percentage of total loans, net of unearned income 1.26% 8.01% 1.43% Allowance for loan losses as a percentage of nonperforming loans 713.22% 560.16% 690.10% YTD annualized net charge-offs to average total loans, net of unearned income 0.02% 2.93% 0.09% As of and for the three months ended Bank Other Consolidated March 31, 2006 ----------------------------------------------- ------- ------------ Nonperforming loans as a percentage of total loans, net of unearned income 0.33% 1.11% 0.35% Nonperforming assets as a percentage of total assets 0.46% 1.68% 0.49% Allowance for loan losses as a percentage of total loans, net of unearned income 1.26% 7.94% 1.43% Allowance for loan losses as a percentage of nonperforming loans 381.87% 716.47% 405.23% YTD annualized net charge-offs to average total loans, net of unearned income 0.15% 2.59% 0.21% As of and for the year ended December Bank Other Consolidated 31, 2006 --------------------------------------- ------- ------- ------------ 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% Net charge-offs to average total loans, net of unearned income 0.14% 2.82% 0.20% GREENE COUNTY BANCSHARES, INC. Condensed Average Balances, Interest Rates and Yields March 31, 2007 Three Months Ended March 31, ------------------------------------------------------- 2007 2006 --------------------------- --------------------------- Average Average Average Average Balance Interest Rate Balance Interest Rate ---------- -------- ------- ---------- -------- ------- Interest- earning assets: - -------------- Loans 1,572,640 31,915 8.23% 1,392,401 26,100 7.60% Investment securities 51,676 707 5.55% 56,446 631 4.53% Other short- term investments 1,258 16 5.16% 3,374 36 4.33% ---------- -------- ------- ---------- -------- ------- Total interest- earning assets 1,625,574 32,638 8.14% 1,452,221 26,767 7.48% ---------- -------- ------- ---------- -------- ------- Non-interest earning assets 153,345 147,140 ---------- ---------- Total assets 1,778,919 1,599,361 ========== ========== Interest- bearing liabilities: - -------------- Deposits: - -------------- Now accounts, money market and savings 540,648 3,546 2.66% 520,821 2,576 2.01% Time deposits 673,242 7,607 4.58% 626,047 5,466 3.54% ---------- -------- ------- ---------- -------- ------- Total interest bearing- deposits 1,213,890 11,153 3.73% 1,146,868 8,042 2.84% ---------- -------- ------- ---------- -------- ------- Securities sold under repurchase and short- term borrowings 25,856 286 4.49% 21,678 207 3.87% Notes payable 185,312 2,378 5.20% 101,629 1,332 5.32% ---------- -------- ------- ---------- -------- ------- Total interest- bearing liabilities 1,425,058 13,817 3.93% 1,270,175 9,581 3.06% ---------- -------- ------- ---------- -------- ------- Non-Interest Bearing Liabilities: - -------------- Demand Deposits 145,185 140,044 Other Liabilities 20,398 17,312 ---------- ---------- Total Non- Interest Bearing Liabilities 165,583 157,356 ---------- ---------- Total liabilities 1,590,641 1,427,531 ---------- ---------- Shareholders' equity 188,278 171,830 Total liabilities & shareholders' equity 1,778,919 1,599,361 ========== ========== Net interest income 18,821 17,186 ======== ======== Interest rate spread 4.21% 4.42% ======= ======= Net yield on interest- earning assets (net interest margin) 4.70% 4.80% ======= ======= GREENE COUNTY BANCSHARES, INC. Consolidated Financial Highlights March 31, 2007 (UNAUDITED) - ---------------------------------------------------------------------- March 31, 2007 December 31, 2006 ------------------ ------------------ Loans Balance % Balance % % Change ------------------- ---------- ------- ---------- ------- --------- Commercial $ 273,198 16.91% $ 258,998 16.70% 5.48% Commercial real estate 977,323 60.49% 921,190 59.38% 6.09% Residential real estate 274,496 16.99% 281,629 18.16% -2.53% Consumer 87,580 5.42% 87,111 5.62% 0.54% Other 3,021 0.19% 2,203 0.14% 37.13% ---------- ------- ---------- ------- --------- 1,615,618 100.00% 1,551,131 100.00% 4.16% ======= ======= ========= Less: Unearned interest income (12,337) (11,502) ---------- ---------- Total $1,603,281 $1,539,629 ========== ========== Loan Balances by Geographical Region and Operating Subsidiaries -------------------------------------- March 31, 2007 December 31, 2006 ------------------ ------------------ % to % to Loan Total Loan Total Balance Loans Balance Loans % Change ---------- ------- ---------- ------- --------- Northeastern Tennessee Region(1) $ 472,032 29.44% $ 465,567 30.24% 1.39% East Tennessee Region 662,227 41.31% 625,632 40.64% 5.85% Middle Tennessee Region 433,900 27.06% 414,379 26.91% 4.71% GCB Acceptance Corporation 14,533 0.91% 13,444 0.87% 8.10% Superior Financial Services, Inc. 20,589 1.28% 20,607 1.34% -0.09% ---------- ------- ---------- ------- --------- Totals $1,603,281 100.00% $1,539,629 100.00% 4.13% ========== ======= ========== ======= ========= (1) Includes one branch located in Southwestern Virginia and one branch located in Northwestern North Carolina - ---------------------------------------------------------------------- - ---------------------------------------------------------------------- March 31, 2007 December 31, 2006 ------------------ ------------------ Deposits Balance % Balance % % Change ------------------- ---------- ------- ---------- ------- --------- Non-interest bearing demand $ 150,716 10.84% $ 152,634 11.45% -1.26% Interest bearing demand 368,312 26.49% 304,828 22.88% 20.83% Money market and savings 214,150 15.40% 194,068 14.56% 10.35% Retail time 421,595 30.32% 445,816 33.46% -5.43% Jumbo time 235,669 16.95% 235,159 17.65% 0.22% ---------- ------- ---------- ------- --------- Total $1,390,442 100.00% $1,332,505 100.00% 4.35% ========== ======= ========== ======= ========= Deposit Balances by Geographical Region and Operating Subsidiaries -------------------------------------- March 31, 2007 December 31, 2006 ------------------ ------------------ Balance % Balance % % Change ---------- ------- ---------- ------- --------- Northeastern Tennessee Region(1) $ 646,601 46.50% $ 613,257 46.02% 5.44% East Tennessee Region 283,373 20.38% 281,094 21.10% 0.81% Middle Tennessee Region 460,468 33.12% 438,154 32.88% 5.09% GCB Acceptance Corporation - 0.00% - 0.00% - Superior Financial Services, Inc. - 0.00% - 0.00% - ---------- ------- ---------- ------- --------- $1,390,442 100.00% $1,332,505 100.00% 4.35% ========== ======= ========== ======= ========= (1) Includes one branch located in Southwestern Virginia and one branch located in Northwestern North Carolina - ---------------------------------------------------------------------- CONTACT: Greene County Bancshares, Inc. James E. Adams, 423-278-3050 Senior Vice President and Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----