CORNELIA, Ga., Aug. 10 /PRNewswire-FirstCall/ -- Habersham Bancorp (Nasdaq: HABC) reports a second quarter loss of $1.6 million or $.57 per diluted share when compared to a second quarter loss of $375,000 or $.13 per diluted share for the same period in 2008. The decrease resulted principally from a decrease in net interest income of approximately $1.1 million and additional expense from provisions for loan losses of approximately $646,000.

For the six-month period ended June 30, 2009, the Company reports a loss of $3.3 million or $1.15 per diluted share when compared to a loss of $316,000 or $.11 per diluted share for the six-month period ended June 30, 2008. The decrease resulted principally from a decrease in net interest income of approximately $2.2 million and additional expense from provisions for loan losses of approximately $2.0 million.

The decreases in net interest income resulted from: 1) an increase in the total dollar balances of loans on nonaccrual status and, 2) a decrease in average loan balances. Non-performing assets increased approximately $2.6 million from December 31, 2008 to June 30, 2009 primarily as a result of activity within nonaccrual loans and other real estate.

The Company's net interest margin for the second quarter and first six months of 2009 was 2.11% and 2.25%, respectively, compared to 3.09% and 3.21% for the second quarter and first six months of 2008.

Total assets of $518.2 million at June 30, 2009 reflect an increase of $23.3 million or 4.72% from $494.9 million at December 31, 2008. Increases in cash and cash equivalent balances (primarily federal funds sold), other real estate and in all other assets totaling approximately $27.2 million, $7.5 million and $2.3 million, respectively, were offset by decreases in the total net loan portfolios and in the investment securities portfolios totaling approximately $9.8 million and $3.9 million, respectively.

HABERSHAM BANCORP FINANCIAL HIGHLIGHTS

(Unaudited)(dollar amounts in thousands, except per share amounts) 


                                   Three Months Ended    Six Months Ended
    Summary of Operations                June 30,           June 30,

                                     2009       2008      2009       2008
                                     ----       ----      ----       ----

    Interest income                $5,323     $6,835   $11,011    $14,438
    Interest expense                3,161      3,565     6,380      7,573
                                    -----      -----     -----      -----
      Net Interest income           2,162      3,270     4,631      6,865

    Provision for loan losses       1,300        654     3,080      1,077
                                    -----        ---     -----      -----
      Net interest income after
      provision for loan losses       862      2,616     1,551      5,788
                                      ---      -----     -----      -----

    Other income                      793        973     1,659      2,002
    Gain on sale of Investment
     securities available for sale    256        161       314        289
    Other expense                   4,605      4,646     9,069      9,112
                                    -----      -----     -----      -----
      Loss before income taxes     (2,694)      (896)   (5,545)    (1,033)

    Income tax benefit              1,094        521     2,290        717
                                    -----        ---     -----        ---

    Net loss                      $(1,600)     $(375)  $(3,255)     $(316)
                                  =======      =====   =======      =====

    Net loss per share - basic      $(.57)     $(.13)   $(1.15)     $(.11)
                                    ======     ======   =======     ======

    Net loss per share - diluted    $(.57)     $(.13)   $(1.15)     $(.11)
                                   ======     ======    =======     ======

    Weighted average number of
     common shares              2,818,593  2,818,593 2,818,593  2,818,593
        Outstanding             =========  ========= =========  =========

    Weighted average number of
     common and common
     equivalent shares
     outstanding                2,818,593  2,818,593 2,818,593  2,818,593
                                =========  ========= =========  =========
    Cash dividends declared
     per common share                   -       $.10         -       $.20
                                      ===       ====       ===       ====



                                                June 30,     December 31,
    Balance Sheet Summary                         2009          2008
    Total Assets                                $518,222      $494,869
    Loans, net                                   300,209       310,607
    Deposits                                     419,417       392,888
    Stockholders' Equity                          39,337        41,998

SOURCE Habersham Bancorp