GABA Georgia Bancshares Inc (CE)

Georgia Bancshares, Inc., (OTC BB:GABA.OB), the parent company of The Bank of Georgia, today announced net income of $2.1 million or $0.71 per share for the twelve months ended December 31, 2007, a 46.1% decrease when compared to $3.9 million or $1.37 per share for the same period in 2006. Total assets were $362. 5 million at December 31, 2007, a 14.0% increase compared to $318.0 million at December 31, 2006. Loans grew 16.0% to $295.5 million at December 31, 2007 compared to $254.8 million at December 31, 2006. Results for 2007 are unaudited and, therefore are subject to change during the course of the upcoming audit. Like many community banks facing challenges related to the residential housing market, The Bank of Georgia has made a concerted effort to remain proactive in aggressively identifying problem credits. Accordingly, we have increased our allowance for loan losses at December 31, 2007 to $4.5 million or 1.52% of total loans to prepare for future credit issues that may develop. Net charge-offs against the allowance for loan losses for 2007 totaled $1.1 million compared to $197 thousand in 2006. At December 31, 2007 non-performing assets were $5.6 million as compared to $552 thousand at the previous year�s end. Today, the Board of Directors declared a cash dividend of $.10 per share for common shareholders and $.11 per share for Series A preferred shareholders. The dividends are payable on February 15, 2008 to holders of record on January 31, 2008. Both our common and preferred stocks are available for market quotations on the Over The Counter Bulletin Board (OTCBB) under the symbols �GABA.OB� and �GABAP.OB�, respectively. For more information about Georgia Bancshares, Inc., visit our Investors Relations website at www.georgiabancshares.com. Based in Peachtree City, GA, Georgia Bancshares, Inc. is a bank holding company that provides traditional bank services to small businesses and consumers through its subsidiary, The Bank of Georgia. The Bank of Georgia opened for business in February 2000, and has nine locations in Peachtree City, Fayetteville, Newnan, Sharpsburg, Tyrone and Fairburn, Georgia. A full-service bank, The Bank of Georgia provides a broad array of services, including checking accounts, money market accounts, certificates of deposit, commercial loans, construction loans, consumer loans (including home equity lines of credit), residential mortgage loans, credit cards, drive-through windows, ATMs, on-line banking, and Visa check cards. For more information about The Bank of Georgia, visit www.bankofgeorgia.com. Except for the historical information contained herein, the matters discussed in this press release may be deemed to be forward-looking statements that involve risks and uncertainties, including changes in economic conditions, changes in policies by regulatory agencies, fluctuations in interest rates, demand for loans, the level of allowance for loan losses, the rate of delinquencies and amounts of charge-offs, and competition. Actual strategies and results in future periods may differ materially from those currently expected. These forward-looking statements represent our judgment as of the date of this release. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Georgia Bancshares, Inc. Financial Highlights (In Thousands, Except Per Share Data) � � December 31, 2007 � December 31, 2006 For the Year Ended (unaudited) (audited) Total interest income $ 26,666 $ 21,552 Total interest expense � 13,094 � � 8,641 � Net interest income 13,572 12,911 Provision for loan losses � 2,297 � � 612 � Net interest income after provision 11,275 12,299 Total other income 1,530 2,195 Total other expense � 9,963 � � 8,609 � Income before income taxes 2,842 5,885 Income tax expense � 756 � � 2,013 � Net earnings $ 2,086 � $ 3,872 � � Per Share Data: Common shares outstanding - end of period 3,010,023 2,814,098 Weighted average shares outstanding 2,941,814 2,830,068 Weighted average diluted shares outstanding 3,333,045 3,370,545 Basic net earnings per share $ 0.71 $ 1.37 Diluted net earnings per share $ 0.63 $ 1.15 Cash dividends declared (common) $ 0.30 $ 0.10 Cash dividends declared (preferred) $ 0.33 $ 0.11 Book value (common) $ 9.11 $ 8.93 � At Period End: Loans, gross $ 295,535 $ 254,842 Allowance for loan losses $ 4,480 $ 3,313 Total assets $ 362,495 $ 318,013 Total deposits $ 280,122 $ 262,456 Shareholders' equity $ 29,718 $ 27,436 � Key Performance Ratios: Return on average assets 0.59 % 1.34 % Return on average equity 7.20 % 15.21 % Net interest margin 4.31 % 5.07 % Dividend payout ratio 45.19 % 7.73 % Total efficiency ratio 63.39 % 56.55 % � Asset Quality Ratios: Non-performing assets / loans & OREO 1.88 % 0.22 % Allowance for loan losses / total loans 1.52 % 1.30 % Allowance for loan losses / non-performing assets 79.71 % 600.17 % Allowance for loan losses / total capital 12.54 % 9.97 % Net charge-offs / average loans 0.40 % 0.09 % � Capital Ratios: Equity / assets 8.20 % 8.63 % Tier 1 leverage ratio 9.65 % 11.16 % Total risk based capital ratio 12.05 % 12.81 %