Citizens Holding Company Earnings up 4.8%

  
    
  
  
    
      Citizens Holding Company (Amex:CIZ) announced today results of 
      operations for the three and nine months ended September 30, 2006.
    
    
      Net income for the three months ended September 30, 2006 increased to 
      $2.125 million, or $.42 per share-basic and diluted, from $1.933 
      million, or $.39 per share-basic and $.38 per share-diluted for the same 
      quarter in 2005. Net interest income for the third quarter of 2006, 
      after the provision for loan losses for the quarter, was approximately 
      11.8% higher than the same period in 2005, in part due to the negative 
      provision for loan losses brought about by improving loan quality and 
      favorable loss experience. The provision for possible loan losses for 
      the three months ended September 30, 2006 was a negative provision of 
      $111 thousand compared to the positive provision of $540 thousand for 
      the same period in 2005. The net interest margin decreased to 4.55% in 
      the third quarter of 2006 from 4.63% in the same period in 2005 
      primarily because of the recent rise in interest rates paid on interest 
      bearing liabilities. Non-interest income increased in the third quarter 
      of 2006 by approximately $28 thousand while non-interest expenses 
      increased $287 thousand compared to the same period in 2005.
    
    
      Net income for the nine months ended September 30, 2006 increased 4.8% 
      to $6.161 million, or $1.23 per share-basic and $1.21 per share-diluted, 
      from the $5.879 million, $1.17 per share basic and $1.16 per share 
      diluted for the first nine months of 2005. Net interest income for the 
      nine month period ended September 30, 2006, after the provision for loan 
      losses, increased 7.2% to $17.717 million from $16.527 million in the 
      same period in 2005 although the net interest margin decreased to 4.52% 
      in 2006 from 4.69% in 2005. The provision for possible loan losses for 
      the nine months ended September 30, 2006 was a negative provision of 
      $303 thousand compared to the positive provision of $1.046 million for 
      the same period in 2005. This negative provision was the result of 
      improved loan quality, favorable loss experience and a decrease in loans 
      outstanding. Non-interest income increased $194 thousand and 
      non-interest expense increased $698 thousand in the nine month period 
      ended September 30, 2006 when compared to the same period in 2005.
    
    
      Total assets as of September 30, 2006 decreased $5.599 million, or .9%, 
      when compared to December 31, 2005. Deposits decreased $6.748 million, 
      or 1.4%. Loans, net of unearned income during this period decreased 
      $5.698 million, or 1.5%, due to several large loans at December 31, 2005 
      for supplies for the Hurricane Katrina disaster area. Those contracts 
      have been completed and the loans repaid. Non performing assets 
      decreased $946 thousand at September 30, 2006 compared to December 31, 
      2005 because of a decrease in loans that were 90 days or more past due, 
      non-accrual loans and other real estate owned.
    
    
      During the first three quarters of 2006, the Company paid dividends 
      totaling $0.51 per share. This represents an increase of 6.3% over the 
      same period in 2005.
    
    
      Citizens Holding Company (the “Company”) 
      is a one-bank holding company and the parent company of The Citizens 
      Bank of Philadelphia, both headquartered in Philadelphia, Mississippi. 
      The Bank currently has nineteen banking locations in eight counties in 
      East Central Mississippi. In addition to full service commercial 
      banking, the Company offers mortgage loans, title insurance services 
      through its subsidiary, Title Services, LLC, and a full range of 
      Internet banking services including online banking, bill pay and cash 
      management services for businesses. Internet services are available at 
      the Bank web site, www.thecitizensbankphila.com. 
      Citizens Holding Company stock is listed on the American Stock Exchange 
      and is traded under the symbol CIZ. The Company’s 
      transfer agent is American Stock Transfer & Trust Company. Information 
      about Citizens Holding Company may be obtained by accessing its 
      corporate website at www.citizensholdingcompany.com.
    
    
      This release includes “forward-looking 
      statements” within the meaning of Section 27A 
      of the Securities Act of 1933 and Section 21E of the Securities Exchange 
      Act of 1934. All statements other than statements of historical facts 
      included in this release regarding the Company’s 
      financial position, results of operations, business strategies, plans, 
      objectives and expectations for future operations, are forward looking 
      statements. The Company can give no assurances that the assumptions upon 
      which such forward-looking statements are based will prove to have been 
      correct. Forward-looking statements speak only as of the date they are 
      made. The Company does not undertake a duty to update forward-looking 
      statements to reflect circumstances or events that occur after the date 
      the forward-looking statements are made. Such forward-looking statements 
      are subject to certain risks, uncertainties and assumptions. The risks 
      and uncertainties that may affect the operation, performance, 
      development and results of the Company’s and 
      the bank’s business include, but are not 
      limited to, the following: (a) the risk of adverse changes in business 
      conditions in the banking industry generally and in the specific markets 
      in which the Company operate; (b) changes in the legislative and 
      regulatory environment that negatively impact the Company and bank 
      through increased operating expenses; (c) increased competition from 
      other financial institutions; (d) the impact of technological advances; 
      (e) expectations about the movement of interest rates, including actions 
      that may be taken by the Federal Reserve Board in response to changing 
      economic conditions; (f) changes in asset quality and loan demand; (g) 
      expectations about overall economic strength and the performance of the 
      economics in the Company’s market area and 
      (h) other risks detailed from time to time in the Company’s 
      filings with the Securities and Exchange Commission. Should one or more 
      of these risks materialize, or should any such underlying assumptions 
      prove to be significantly different, actual results may vary 
      significantly from those anticipated, estimated, projected or expected.
    
    
      
        
          
            Citizens Holding Company
          
          
            Financial Highlights
          
          
            (amounts in thousands, except share and per share data)
          
          
            (Unaudited)
          
          
            ----------------------------------------------------
          
        
      
      
        
        
        
          Three Months
        
        
          Nine Months
        
      
      
        
        
        
          Ended September 30
        
        
          Ended September 30
        
      
      
        
        
        
          2006 
        
        
        
        
          2005 
        
        
          2006 
        
        
        
        
          2005 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Interest income and fees
        
        
          $9,265 
        
        
        
        
          $8,449 
        
        
          $27,087 
        
        
        
        
          $24,537 
        
      
      
        
          Interest expense
        
        
          3,425 
        
        
           
        
        
          2,588 
        
        
          9,673 
        
        
           
        
        
          6,964 
        
      
      
        
          Net interest income
        
        
          5,840 
        
        
        
        
          5,861 
        
        
          17,414 
        
        
        
        
          17,573 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Provision for loan losses
        
        
          (111)
        
        
           
        
        
          540 
        
        
          (303)
        
        
           
        
        
          1,046 
        
      
      
        
          
            Net interest income after provision for loan losses
          
        
        
          5,951 
        
        
        
        
          5,321 
        
        
          17,717 
        
        
        
        
          16,527 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Non-interest income
        
        
          1,582 
        
        
        
        
          1,554 
        
        
          4,646 
        
        
        
        
          4,452 
        
      
      
        
          Non-interest expense
        
        
          4,657 
        
        
           
        
        
          4,370 
        
        
          14,024 
        
        
           
        
        
          13,326 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net income before taxes
        
        
          2,876 
        
        
        
        
          2,505 
        
        
          8,339 
        
        
        
        
          7,653 
        
      
      
        
          Income taxes
        
        
          751 
        
        
           
        
        
          572 
        
        
          2,178 
        
        
           
        
        
          1,774 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net income
        
        
          $2,125 
        
        
           
        
        
          $1,933 
        
        
          $6,161 
        
        
           
        
        
          $5,879 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Earnings per share – basic
        
        
          $0.42 
        
        
           
        
        
          $0.39 
        
        
          $1.23 
        
        
           
        
        
          $1.17 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Earnings per share – diluted
        
        
          $0.42 
        
        
           
        
        
          $0.38 
        
        
          $1.21 
        
        
           
        
        
          $1.16 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Average shares outstanding-basic
        
        
          5,019,213 
        
        
        
        
          5,009,039 
        
        
          5,014,919 
        
        
        
        
          5,005,555 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Average shares outstanding-diluted
        
        
          5,077,414 
        
        
        
        
          5,077,330 
        
        
          5,081,634 
        
        
        
        
          5,065,289 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
          As of
        
        
        
        
          As of
        
      
      
        
        
        
        
        
        
        
        
        
          September 30,
        
        
        
        
          December 31,
        
      
      
        
        
        
        
        
        
        
        
        
          2006 
        
        
        
        
          2005 
        
      
      
        
          Balance Sheet Data:
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Total assets
        
        
        
        
        
        
        
        
          $602,110 
        
        
        
        
          $607,709 
        
      
      
        
          Total earning assets
        
        
        
        
        
        
        
        
          535,805 
        
        
        
        
          535,321 
        
      
      
        
          Loans, net of unearned income
        
        
        
        
        
        
        
        
          373,828 
        
        
        
        
          379,526 
        
      
      
        
          Allowance for loan losses
        
        
        
        
        
        
        
        
          3,907 
        
        
        
        
          4,562 
        
      
      
        
          Total deposits
        
        
        
        
        
        
        
        
          467,064 
        
        
        
        
          473,812 
        
      
      
        
          Long-term borrowings
        
        
        
        
        
        
        
        
          59,400 
        
        
        
        
          60,049 
        
      
      
        
          Shareholders' equity
        
        
        
        
        
        
        
        
          68,037 
        
        
        
        
          63,774 
        
      
      
        
          Book value per share
        
        
        
        
        
        
        
        
          13.55 
        
        
        
        
          12.73 
        
      
      
        
          Dividends paid per share (a)
        
        
        
        
        
        
        
        
          0.51 
        
        
        
        
          0.65 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Average Balance Sheet Data:
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Total assets
        
        
        
        
        
        
        
        
          $606,596 
        
        
        
        
          $591,872 
        
      
      
        
          Total earning assets
        
        
        
        
        
        
        
        
          539,463 
        
        
        
        
          528,562 
        
      
      
        
          Loans, net of unearned income
        
        
        
        
        
        
        
        
          374,925 
        
        
        
        
          371,925 
        
      
      
        
          Total deposits
        
        
        
        
        
        
        
        
          472,457 
        
        
        
        
          464,629 
        
      
      
        
          Long-term borrowings
        
        
        
        
        
        
        
        
          59,678 
        
        
        
        
          54,823 
        
      
      
        
          Shareholders' equity
        
        
        
        
        
        
        
        
          65,772 
        
        
        
        
          63,068 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Non-performing assets:
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Non-accrual loans
        
        
        
        
        
        
        
        
          3,868 
        
        
        
        
          4,347 
        
      
      
        
          Loans 90+ days past due
        
        
        
        
        
        
        
        
          730 
        
        
        
        
          911 
        
      
      
        
          Other real estate owned
        
        
        
        
        
        
        
        
          2,689 
        
        
        
        
          2,975 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            Net charge-offs as a percentage of average net loans (a)
          
        
        
        
        
        
        
        
        
          0.09%
        
        
        
        
          0.33%
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Performance Ratios:
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Return on average assets (a)
        
        
        
        
        
        
        
        
          1.35%
        
        
        
        
          1.35%
        
      
      
        
          Return on average equity (a)
        
        
        
        
        
        
        
        
          12.49%
        
        
        
        
          12.63%
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net interest margin (tax equivalent) (a)
        
        
        
        
        
        
          4.52%
        
        
        
        
          4.61%
        
      
      
        
           
        
      
      
        
          
            (a) For the nine months ended September 30, 2006 and for the year 
            ended December 31, 2005, as applicable.
          
          
            --------------------------
          
        
      
    
  
Citizens Holding Company (Amex:CIZ) announced today results of
operations for the three and nine months ended September 30, 2006.

   Net income for the three months ended September 30, 2006 increased
to $2.125 million, or $.42 per share-basic and diluted, from $1.933
million, or $.39 per share-basic and $.38 per share-diluted for the
same quarter in 2005. Net interest income for the third quarter of
2006, after the provision for loan losses for the quarter, was
approximately 11.8% higher than the same period in 2005, in part due
to the negative provision for loan losses brought about by improving
loan quality and favorable loss experience. The provision for possible
loan losses for the three months ended September 30, 2006 was a
negative provision of $111 thousand compared to the positive provision
of $540 thousand for the same period in 2005. The net interest margin
decreased to 4.55% in the third quarter of 2006 from 4.63% in the same
period in 2005 primarily because of the recent rise in interest rates
paid on interest bearing liabilities. Non-interest income increased in
the third quarter of 2006 by approximately $28 thousand while
non-interest expenses increased $287 thousand compared to the same
period in 2005.

   Net income for the nine months ended September 30, 2006 increased
4.8% to $6.161 million, or $1.23 per share-basic and $1.21 per
share-diluted, from the $5.879 million, $1.17 per share basic and
$1.16 per share diluted for the first nine months of 2005. Net
interest income for the nine month period ended September 30, 2006,
after the provision for loan losses, increased 7.2% to $17.717 million
from $16.527 million in the same period in 2005 although the net
interest margin decreased to 4.52% in 2006 from 4.69% in 2005. The
provision for possible loan losses for the nine months ended September
30, 2006 was a negative provision of $303 thousand compared to the
positive provision of $1.046 million for the same period in 2005. This
negative provision was the result of improved loan quality, favorable
loss experience and a decrease in loans outstanding. Non-interest
income increased $194 thousand and non-interest expense increased $698
thousand in the nine month period ended September 30, 2006 when
compared to the same period in 2005.

   Total assets as of September 30, 2006 decreased $5.599 million, or
.9%, when compared to December 31, 2005. Deposits decreased $6.748
million, or 1.4%. Loans, net of unearned income during this period
decreased $5.698 million, or 1.5%, due to several large loans at
December 31, 2005 for supplies for the Hurricane Katrina disaster
area. Those contracts have been completed and the loans repaid. Non
performing assets decreased $946 thousand at September 30, 2006
compared to December 31, 2005 because of a decrease in loans that were
90 days or more past due, non-accrual loans and other real estate
owned.

   During the first three quarters of 2006, the Company paid
dividends totaling $0.51 per share. This represents an increase of
6.3% over the same period in 2005.

   Citizens Holding Company (the "Company") is a one-bank holding
company and the parent company of The Citizens Bank of Philadelphia,
both headquartered in Philadelphia, Mississippi. The Bank currently
has nineteen banking locations in eight counties in East Central
Mississippi. In addition to full service commercial banking, the
Company offers mortgage loans, title insurance services through its
subsidiary, Title Services, LLC, and a full range of Internet banking
services including online banking, bill pay and cash management
services for businesses. Internet services are available at the Bank
web site, www.thecitizensbankphila.com. Citizens Holding Company stock
is listed on the American Stock Exchange and is traded under the
symbol CIZ. The Company's transfer agent is American Stock Transfer &
Trust Company. Information about Citizens Holding Company may be
obtained by accessing its corporate website at
www.citizensholdingcompany.com.

   This release includes "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. All statements other than
statements of historical facts included in this release regarding the
Company's financial position, results of operations, business
strategies, plans, objectives and expectations for future operations,
are forward looking statements. The Company can give no assurances
that the assumptions upon which such forward-looking statements are
based will prove to have been correct. Forward-looking statements
speak only as of the date they are made. The Company does not
undertake a duty to update forward-looking statements to reflect
circumstances or events that occur after the date the forward-looking
statements are made. Such forward-looking statements are subject to
certain risks, uncertainties and assumptions. The risks and
uncertainties that may affect the operation, performance, development
and results of the Company's and the bank's business include, but are
not limited to, the following: (a) the risk of adverse changes in
business conditions in the banking industry generally and in the
specific markets in which the Company operate; (b) changes in the
legislative and regulatory environment that negatively impact the
Company and bank through increased operating expenses; (c) increased
competition from other financial institutions; (d) the impact of
technological advances; (e) expectations about the movement of
interest rates, including actions that may be taken by the Federal
Reserve Board in response to changing economic conditions; (f) changes
in asset quality and loan demand; (g) expectations about overall
economic strength and the performance of the economics in the
Company's market area and (h) other risks detailed from time to time
in the Company's filings with the Securities and Exchange Commission.
Should one or more of these risks materialize, or should any such
underlying assumptions prove to be significantly different, actual
results may vary significantly from those anticipated, estimated,
projected or expected.

-0-
*T
                       Citizens Holding Company
                         Financial Highlights
       (amounts in thousands, except share and per share data)
                             (Unaudited)
         ----------------------------------------------------
                           Three Months            Nine Months
                        Ended September 30      Ended September 30
                         2006       2005        2006         2005
                       ---------- ----------------------- ------------

Interest income and
 fees                     $9,265     $8,449      $27,087      $24,537
Interest expense           3,425      2,588        9,673        6,964
                       -----------------------------------------------
  Net interest income      5,840      5,861       17,414       17,573


Provision for loan
 losses                     (111)       540         (303)       1,046
                       -----------------------------------------------
  Net interest income
   after provision for
   loan losses             5,951      5,321       17,717       16,527

Non-interest income        1,582      1,554        4,646        4,452
Non-interest expense       4,657      4,370       14,024       13,326
                       -----------------------------------------------

  Net income before
   taxes                   2,876      2,505        8,339        7,653
Income taxes                 751        572        2,178        1,774
                       -----------------------------------------------

   Net income             $2,125     $1,933       $6,161       $5,879
                       ===============================================


Earnings per share -
 basic                     $0.42      $0.39        $1.23        $1.17
                       ===============================================

Earnings per share -
 diluted                   $0.42      $0.38        $1.21        $1.16
                       ===============================================

Average shares
 outstanding-basic     5,019,213  5,009,039    5,014,919    5,005,555

Average shares
 outstanding-diluted   5,077,414  5,077,330    5,081,634    5,065,289


                                                As of        As of
                                            September 30, December 31,
                                                2006         2005
                                            ------------- ------------
Balance Sheet Data:
  Total assets                                  $602,110     $607,709
  Total earning assets                           535,805      535,321
  Loans, net of
   unearned income                               373,828      379,526
  Allowance for loan
   losses                                          3,907        4,562
  Total deposits                                 467,064      473,812
  Long-term borrowings                            59,400       60,049
  Shareholders' equity                            68,037       63,774
  Book value per share                             13.55        12.73
  Dividends paid per
   share (a)                                        0.51         0.65

Average Balance Sheet
 Data:
  Total assets                                  $606,596     $591,872
  Total earning assets                           539,463      528,562
  Loans, net of
   unearned income                               374,925      371,925
  Total deposits                                 472,457      464,629
  Long-term borrowings                            59,678       54,823
  Shareholders' equity                            65,772       63,068

Non-performing assets:
  Non-accrual loans                                3,868        4,347
  Loans 90+ days past
   due                                               730          911
  Other real estate
   owned                                           2,689        2,975

Net charge-offs as a
 percentage of average
 net loans (a)                                      0.09%        0.33%

Performance Ratios:
  Return on average
   assets (a)                                       1.35%        1.35%
  Return on average
   equity (a)                                      12.49%       12.63%

Net interest margin (tax
 equivalent) (a)                                    4.52%        4.61%

(a) For the nine months ended September 30, 2006 and for the year
 ended December 31, 2005, as applicable.
--------------------------
*T